The U.S. Supreme Court’s ruling to uphold the national health reform law Thursday ushers in a variety of changes to Maine’s health care landscape. Some are new and some are familiar to a state that already has experimented with overhauling its health insurance market through the Dirigo Health program and other reforms.
Many of the major provisions of President Barack Obama’s sweeping federal health reform law take effect in 2014, including a requirement that people who aren’t covered by an employer’s plan or government-subsidized insurance buy health coverage or pay a penalty.
In 2014, the penalty will cost a family a flat fee of $285 or 1 percent of their income, whichever is higher. By 2016, the penalty jumps to either $2,085 for a family or 2.5 percent of income, whichever is higher.
People will be able to shop for health insurance plans through online marketplaces known as exchanges. Some people will qualify for subsidies to help them afford health insurance and avoid the penalty.
About 10 percent of Maine’s population, or 126,000 people, is uninsured, according to the Kaiser Family Foundation. Most of them would newly qualify for Medicaid under the law’s expansion of the program, which provides health insurance for the poor. However, it remains to be seen whether Maine will choose to expand its Medicaid program, known as MaineCare, given the court’s ruling Thursday that allows states to opt out.
While 126,000 people may sound like a lot, Maine’s rate of uninsured residents is lower than in many other states. Maine also covers a comparably high percentage of its population through Medicaid.
So while other states will see a flood of new people gaining health insurance under the reform law, the effect will be less dramatic in Maine, said Michelle Hood, president and CEO of Eastern Maine Healthcare Systems.
That means Maine hospitals still will have to give away a significant amount of free services to people who can’t afford their care, she said. A second hit comes in the form of steep cuts to reimbursements to hospitals for patients on Medicare under the health care law.
“That will be a challenge for Maine hospitals,” Hood said. “We are subject to the cuts, but at the same time we’re not going to see a vast reduction in the number of uninsured.”
The Maine Hospital Association said in a statement that the Medicare cuts will reduce hospital revenues by $900 million over this decade. The law also brings rewards for states that seek to lower costs through better management and coordination of health care, the statement said.
The Maine Medical Association, which represents physicians, cheered the health reform law’s survival. A statement highlighted the 226,000 Maine people with private health insurance who have gained free preventive coverage under the law and discounts on drugs that helped nearly 12,000 Medicare recipients pay for prescriptions last year.
The ACA also allows young adults to stay on their parents’ insurance plans until age 26.
Ashley Pincins, 25, said the law helped her to graduate from pharmacy school without incurring medical debt or skipping needed care. She faced aging out of coverage and losing her insurance midsemester, she said, until the ACA kicked in.
“All of a sudden, it moved my concerns from learning about prescriptions to affording and handling my own,” said Pincins, who’s completing a residency at Penobscot Community Health Care in Bangor.
Before the ACA came along, Maine allowed parents the option to keep their children on their health plan until age 25 under certain conditions.
Maine beat national health reform to the punch in several other areas as well, including requiring insurers that serve small businesses to spend a certain amount of consumers’ premium dollars on their medical care or refund it through a rebate.
The ACA imposed a similar requirement that also includes insurers catering to large companies. The national provision will put $2.6 million in rebates into the hands of more than 10,000 Mainers this summer, with an average payback of $463. The money will be paid out by a single insurer, CIGNA, U.S. Health and Human Services confirmed Wednesday, and funneled through large employers in the state. Under Maine’s provision, insurer Aetna has previously paid out rebates.
Maine has placed limits on insurers denying coverage to people with many pre-existing conditions since the early 1990s, which the ACA outlaws starting in 2014. Maine also already prohibits insurers from refusing to pay claims after policyholders’ medical costs reach annual limits.
Health insurer Anthem said in a statement on the court ruling that the company would “continue to move forward with our efforts to improve our nation’s health care delivery system,” including partnering with primary care doctors and offering case managers and health coaches to help people manage and improve their health.
Dr. Roger Renfrew, a geriatrician in Skowhegan, applauded the law’s move toward better managing care, particularly for patients with chronic illness. A new yearly wellness visit for Medicare recipients already is paying dividends, he said.
“I’ve found that to be an incredibly useful tool as I’m dealing especially with my frailer population,” he said. “It was pretty well designed for a government program.”
The Supreme Court ruling removed much uncertainty from Maine’s health care outlook, but congressional Republicans have vowed to repeal the law. Health providers and countless others with a stake in the health care system will be watching the presidential election campaign closely for signs about the reform law’s future.