The Medicaid expansion debate is largely settled in the Maine Legislature, but lawmakers in Augusta still have a chance to take action that could make a dent in our state’s higher-than-average health care costs.
The U.S. has the highest health care costs on the planet — 50 percent higher than Norway, the next most expensive country — and among the fastest growing costs, yet there are 36 countries with health care systems that rank more effective than ours. Our economic competitors spend much less on health care. Therefore, they can offer lower prices for their goods or use their surpluses to invest in infrastructure improvements.
Maine has the fifth-highest spending per capita for health care among our 50 states and the second fastest-growing costs, yet there are 15 healthier states than Maine. Over 20 percent of our economy is devoted to health care — well over the national average and the highest portion in New England. Competing states spend 40 percent less than we do on health care. The only way we compete is by having some of the lowest wages in America. Is it not an accident that we do not attract younger workers.
Other states with high health care costs have high income. We don’t. We’re 39th from the top in earned income. Our highest income groups get their money from out-of-state sources. When their costs get too high, they can (and do) leave. It is not an accident that our coastal towns, such as Boothbay Harbor, are losing population, but adding part-time residents who do not pay Maine income taxes. Our high health care costs lead directly to high worker’s compensation costs, where we rank eighth.
It is very clear that Maine must lower health care costs to prosper. The excuse that our high health care costs are a direct result of having an older, sicker, lower-income or more rural population is not supported by the facts.
Lincoln County, where I live, has the oldest population and is tied for the lowest earned income county. Our hospital, Lincoln Health, where I serve on the Performance Improvement Committee, ranks as one of the very best rural health care systems in America. Consumer Reports just ranked us as the safest hospital in America. We are the only Maine hospital that has reduced its prices — an example Maine must follow if we are to have the resources to serve the medical needs of Maine people. Yet, because of low Medicare reimbursement rates, at 71 percent of actual costs, and high levels of free care, at 8 percent of revenue, Lincoln Health still faces constant fiscal challenges.
The Affordable Care Act has not, and likely will not, lower our health care costs. Current estimates have health care costs rising just as fast as they have for more than a decade — with Maine again among the states with the fastest growing costs. Unless we reform our cost structure, Maine will run out of money for health care — with no liquor contract to save us.
Shifting costs to the state’s Medicaid program by expanding it under the Affordable Care Act does not solve the problem. It only delays fiscal sobriety.
To prosper, we must lower health care costs. A 5 percent reduction is a realistic near-term goal. What subsidies under the Affordable Care Act and expanding Medicaid can do is buy us some financial breathing room to make the reforms necessary to cut our health care costs down to a sustainable level. The choice is between walking off a cliff or working our way carefully down the slope toward fiscal sustainability so we cause as little harm as possible.
I propose that we create a health care costs commission modeled on the military’s Base Realignment and Closure Commission. Membership should include four legislative appointees — one from each party and each body — one gubernatorial appointee, one hospital appointee and one health insurance industry appointee. Give the commission three months to create a consensus plan. Present the plan to a special session of the Legislature for an up or down vote. If the plan becomes law, only then would Medicaid expansion go forward.
This proposal echoes a bill I sponsored in the last Legislature that passed unanimously, but failed to be funded. Isn’t it time for our legislators to stop their political gamesmanship and start legislating responsibly? Can you imagine how our lives would improve if our jobs paid 5 percent more, or our taxes were 5 percent less? Can you imagine living in a state with decent roads, or higher education that everyone could afford?
That is our future if we have the will to make it happen.
Les Fossel of Alna is a former representative in the Maine House. He serves on the Performance Review Committee of Lincoln Health, and he is a Republican candidate for state Senate.