EDITORIAL

Rushed insurance reform is wrong medicine

Posted May 04, 2011, at 8:33 p.m.
Last modified May 05, 2011, at 10:06 a.m.
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In pushing a sweeping rewrite of Maine’s health insurance laws aimed at reducing the number of people without such insurance, Republican lawmakers say all they’re trying to do is adopt a successful system from Idaho.

Success, like so much else, is in the eye of the beholder. Each year, the United Health Foundation puts out national health rankings. In the most recent rankings, Idaho ranked ninth. Maine ranked eighth.

In 2010, one of Maine’s strengths was its “low rate of uninsured population at 10.3 percent,” which, to be fair, includes the large number of Maine people covered by government insurance. For this measure, Maine ranked sixth in the country.

Under challenges for Idaho, a younger and healthier state: “high rate of uninsured population.” In 2010, 15.4 percent of the state’s population went without health insurance, ranking Idaho 32nd in that category.

The respected Kaiser Family Foundation ranked Maine fourth for its rate of uninsured. Idaho was ranked 29th.

If reducing the number of people without health insurance is a goal — and it should be — adopting the Idaho plan doesn’t make sense.

This is just one aspect of the proposal that hasn’t undergone sufficient scrutiny.  A week after the supposed public hearing on LD 1333, the amended version — a 29-page replacement of the original four-page bill — was still not available online to the public Wednesday afternoon. It is made available here by the BDN, although the bill was amended again late Wednesday and that version is not available to the public.

It is unconscionable that lawmakers would vote on such far-reaching changes to the state’s insurance regulations without understanding the consequences.

Republicans, like the Democrats before them when they controlled the Legislature and governor’s office, deserve credit for trying to address a vexing problem — bringing more young people into the health insurance pool to better spread risk and lower costs. Too many young people are priced out of the insurance market by high costs.

To accomplish this, however, the completely rewritten LD 1333, takes the most costly people — those with chronic illnesses and those who are older but not yet eligible for Medicare, especially in rural areas — out of the regular insurance pool and puts them into new Guaranteed Access Plan Associations, where they are likely to face higher deductibles and fewer benefits, as is the case with the Idaho plan. The plans will be subsidized by a monthly $4 surcharge assessed on all other policyholders.

Remember how much insurance companies and the Maine Heritage Policy Center squawked about the “Dirigo tax”? Ironic then that a plan drafted by the departing MHPC executive director and insurance company representatives relies on a tax to help cover the cost of insurance for cancer patients and those who are gravely injured. But, while the Dirigo tax raised money to help extend insurance to those who couldn’t afford it, this tax would be used to reduce the burden on insurance companies.

High, and rising, insurance costs are a real problem, but there is a better way that won’t put the state’s most vulnerable at risk. Guaranteed Access Plan Associations could be set up as a pilot project. Let people who want to pay lower premiums sign up for such plans and evaluate the plan’s effectiveness in a couple years. This would let the market decide if such systems work.

Or portions of the rewritten bill could be considered separately. Offering incentives for people to use lower-cost but more distant health care providers, for example, makes sense. The state already is doing this with its employee health plan.

Expanding the gap between the highest and lowest insurance rates — what is called community rating — to the federal level of 3-to-1 may also be a good idea. Instead, LD 1333, as revised, would move Maine’s community rating from 1.5-to-1 to 5-to-1, which would put the state out of compliance with the Affordable Care Act.

Lawmakers should heed the warnings of the respected and measured American Cancer Society — not bash them as the House Speaker’s Office did this week — and not rush this flawed and unstudied plan forward. Instead, they should slow down, make sure they understand all the unintended consequences that would come from these changes and agree on less drastic ways to move toward the same goal.

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