September 22, 2019
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Maine lags behind when it comes to economic growth, but it doesn’t have to

BDN File | BDN
BDN File | BDN
Andrew MacLean, deputy executive vice president of the Maine Medical Association, voices his organization's support for Medicaid expansion at the State House Welcome Center in Augusta, Jan 23, 2014.

Nationally, recent economic data from the Census Bureau was heralded as good news. Incomes are up. Poverty is down. And more Americans than ever are covered by health insurance.

The picture for Maine was less bright, offering an indictment of LePage administration policies and actions by lawmakers that punish rather than seek to alleviate poverty and neglect opportunities to add new jobs and extend health insurance coverage.

Last year, median household income rose 5.2 percent over 2014 levels. That’s the largest annual jump since the Census Bureau began tracking this metric in 1967. In Maine, median household income rose by 4 percent in 2015. That is positive news, but it is muted by the fact that this is the slowest income growth in New England.

There are many reasons for Maine’s lackluster economic performance, some of them are endemic, such as the state’s aged workforce, and not likely to change in the short term. But the most recent census data also make clear that the state’s current policies of rejecting Medicaid expansion and reliance on old, shrinking industries are holding Maine back economically.

In the last legislative session, for example, lawmakers agreed to take $13.5 million from the state’s rainy day fund to boost the state’s biomass industry. The emergency legislation, which directs the Maine Public Utilities Commission to solicit bids for biomass power generation — and pay above market rates for it — was easily passed by lawmakers in April. The aim of the law is to avoid more timber job losses, but one company said at least one of its plants in Maine may close even with the state bailout, according to the Portland Press Herald.

The same lawmakers failed to override LePage’s veto of a compromise rewrite of the state’s solar energy policy that could have created hundreds of jobs and saved Maine residents money on their electricity bills.

These are two small, recent examples of policy decisions that further Maine’s economic stagnation while many other states grow.

On a larger scale, Maine’s refusal to expand Medicaid coverage under the Affordable Care Act, despite several attempts in the Legislature, has wide-ranging consequences. Nationally, the percentage of people without health insurance dropped by 6.7 percent between 2010 and 2015. In Maine, the number of people without health insurance was flat — at 10.1 percent — from 2010-2014 but did drop 1.7 percent between 2014 and 2015. Overall, however, Maine has slipped from 10th in the country for its uninsured rate to 24th as other states have covered more people through expanded Medicaid coverage.

Without health insurance, too many Mainers to go without needed health care, including addiction treatment. Many addicts are seeking treatment but unable to secure limited beds because they don’t have health insurance that will cover the expense.

There are financial consequences as well. After years of consistent growth, uncompensated care costs at hospitals in states that have expanded Medicaid coverage dropped 26 percent in 2014 — compared with 16 percent in nonexpansion states — as fewer patients lacked insurance. States have also started realizing budget savings. In addition, expanding insurance coverage has been shown to improve state economies as residents who previously were uninsured have more money to spend on non-health care expenses and the number of health care sector jobs increases.

Recent decisions by lawmakers and LePage don’t have to be the final word about Maine’s future. State lawmakers who are elected in November can put Maine on a different course by backing policies that emphasize good-paying jobs, expanded health insurance and actually lifting people out of poverty.


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