GARDINER, Maine — The federal government gave Gov. Paul LePage’s administration the go-ahead Monday to restart a dormant program expected to push individual health insurance premiums 9 percent lower next year than they would be in Maine without it.
The approval allows LePage to restart the Maine Guaranteed Access Reinsurance Association, which began as part of a 2011 state health care package backed by Republicans that was credited with lowering premiums but ran for just 18 months before being superseded in 2014 by a similar, transitional program in the federal Affordable Care Act that ran through 2016.
Maine submitted a request in May asking the federal Centers for Medicare and Medicaid Services to allow the Bureau of Insurance to restart the program in May with some federal funding under a program that aims to encourage innovation in health care policy. The request was accepted by President Donald Trump’s administration Monday.
It makes Maine the sixth state to have a reinsurance program approved in this manner, according to the National Conference for State Legislatures. The state estimates that the reduction in individual premiums will shrink the share of uninsured Mainers by 1.7 percent in 2019.
The program is coming back mostly as a backstop to the federal Affordable Care Act. Last year, congressional Republicans passed a tax-cut package repealing the mandate that Americans get health coverage or pay a penalty — a key funding element in the law enshrined under former President Barack Obama.
In Maine and elsewhere, premiums in the individual market have been rising. Anthem, the state’s largest insurer, announced last year that it would largely pull out of the Affordable Care Act’s individual marketplace here, citing an older, sicker customer base and the Trump administration’s lax enforcement of the mandate before its repeal.
The LePage administration’s move is aimed at tamping that down by using a fund to cover insurance costs for high-risk patients who will be enrolled in the pool automatically if they have one of eight conditions — including types of cancer. Insurers will be allowed to voluntarily enroll other patients in the pool.
The fund will then reimburse carriers for 90 percent of claims between $47,000 and $77,000, and 100 percent of claims above that latter threshold up to $1 million. For more expensive claims, the program will cover any amount not picked up by a federal program.
The state estimates that the fund will hold $93 million in revenue in 2019, with $37 million coming from reinsurance premiums, $33.4 million in federal dollars that may be saved under the plan and $22.6 million from a $4 monthly assessment on individual, group and other plans.
The waiver was largely uncontroversial and backed in public testimony by the Maine Hospital Association, the American Cancer Society and the American Heart Association. The Maine Association of Health Plans, an industry group for insurers here, questioned the reliance on federal funds and whether the program could be successfully implemented by January.
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