Small businesses, elderly have been thrown to the insurance wolves

By David Farmer,
Posted Sept. 05, 2012, at 3:31 p.m.

Republican lawmakers should have known better.

Despite dire warnings and well-documented evidence from around the country, Republicans pushed through a major overhaul of health insurance in Maine on the hope – and little else – that it might reduce costs for consumers.

Their blind faith has cost them credibility and has cost their constituents millions of dollars, while weakening consumer protections for all of us.

It’s not clear that most members of the Republican majority were well-informed enough to even understand what they were voting on when Gov. Paul LePage and other GOP leaders jammed through a partisan bill changing health insurance consumer protections.

At the time, a number of members of the Legislature had no idea about the impact the legislation would have or even what was in the law.

When asked about the legislation, right before the vote, Republican representatives showed little understanding about what was being proposed and what the impacts would likely be.

Advocate groups, including Consumers for Affordable Health Care, Maine Equal Justice Partners, the American Cancer Society and many others tried to warn them. But the warnings went unheard.

Driven by party loyalty, the Republicans in the Legislature were content to trust but never verify.

Now the evidence is in, and the facts are terrible.

Consumers for Affordable Health Care this week released a critical report, ” Few Winners, Many Losers: Evaluating the Impact of Key Provisions of Maine’s New Health Insurance Law to Date.”

Don’t let the sexy title fool you.

The report is critical for understanding the changes made in Maine law.

Built on data from the Maine Bureau of Insurance, the report shows that Republicans in the Legislature sold out consumers to benefit the health insurance industry, broke their promises to their constituents and made health insurance less affordable for thousands of small businesses and families.

According to the report, the majority of individual policyholders saw their rates increase. Health insurance rates went up for nine out of 10 small businesses.

For northern and eastern Maine, the numbers are even worse. More than 96 percent of small businesses in both regions were helpless as their insurance rates increased under the new law. Southern Maine fared the best: Only 85 percent of small business saw rates go up.

That’s nothing to brag about.

In addition, important consumer protections were gutted, putting more people at the mercy of health insurance companies.

And did I mention new taxes? For the privilege of paying higher health insurance rates, consumers also were stuck with $22 million in new taxes that pay a subsidy to insurance companies.

The review found that the data collected by the LePage administration “showed higher premiums, worse product choices, higher profits to Maine’s largest individual insurer and weaker review standards.”

“What is happening is that insurance companies are raising premiums on small businesses in all geographic areas, especially on businesses with older workers and those in rural areas,” Joseph Ditre, executive director of CAHC and author of the report, said in a press release accompanying the report. “That means businesses and individuals, who have been paying high rates just to keep their coverage, may now be forced to drop their coverage based on a false promise.”

Back in May 2011, I wrote that the changes to Maine law would increase “the cost of insurance for people who are older, for women, for people who have dangerous jobs and for those who live in rural areas.”

In its report, Consumers for Affordable Health Care tell the story of WoodenBoat Publications Inc., a small business in Brooklin. The company, which has tried to do the right thing by helping its employees afford health insurance, saw a 32-percent increase in costs for health insurance.

Despite a high deductible plan and less coverage, the company’s costs went up $75,144 to cover 31 employees.

“This increase is a huge problem for us,” Jim Miller of WoodenBoat told CAHC. “I don’t know what we’ll do in the future. They’re basically selling insurance based on your ZIP code and your age and for this company … both of those are going against us.”

So far, no one has been able to completely crack the code of reducing the cost of providing affordable health insurance and affordable health care.

But we sure know what doesn’t work.

In 2011, Maine Republicans said day was night and black was white and passed legislation that ignored years of progress and reams of data for a scheme that was destined to hike insurance rates for thousands of small businesses.

Now there’s no escaping the facts. They are front and center for all to see.

Unless you count Anthem, which has seen profits increase with less oversight, few people are winning, and many, many more are losing, especially older Mainers in rural areas.

That’s not reform. That’s selling your constituents out for a partisan dream and an insurance company’s pot of gold.

David Farmer is a political and media consultant. He was formerly deputy chief of staff and communications director for Gov. John E. Baldacci and a longtime journalist. You can reach him at dfarmer14@hotmail.com. Follow him on Twitter @dfarmer14.

http://bangordailynews.com/2012/09/05/opinion/contributors/small-businesses-elderly-have-been-thrown-to-the-insurance-wolves/ printed on December 27, 2014