This legislative session there were a lot of changes to the healthcare system, and unfortunately most of them will make life harder for the thousands of Mainers who struggle to find quality, affordable health insurance. The worst of these was LD 1333, the insurance deregulation and rate hike bill, which was rushed through the legislature, passed along party lines and signed by the Governor in May.
LD 1333 gives more power to insurance companies. The new law allows insurance companies to increase rates on individual policy holders by up to 10% every year, unchecked by our Bureau of Insurance. Until this law passed, insurance companies operating in Maine had to seek approval from our Bureau of Insurance before raising rates and the Bureau conducted studies and held public hearings to determine if the proposed increase was justified, and how it would impact Mainers. For the last three years, the Superintendent of Insurance has denied Anthem the full level of rate increases they have requested each year (instead allowing them only half their requested increases). Without the Bureau positioned to review proposed rate increases, insurance company rate hikes will go on auto-pilot.
Proponents of the new law insist that it will lower costs by allowing Maine people to purchase insurance from companies in other New England states (excluding Vermont). They claim more choices mean more competition, which will mean lower costs. The problems with these claims are twofold. First, there are not really that many insurance companies out there, and if you follow the paper trails, most of them are tied to or owned by the same big mega-corporations. Secondly, insurance companies are for-profit businesses. Unless they are regulated, they will only sell insurance to the people who are least expensive to insure—largely young and healthy people. Taking young healthy people out of our larger insurance pool will make insurance go up for everyone else.
This law is also likely to hurt people living in rural Maine. It repeals Rule 850, which means that insurance companies no longer have to cover providers and hospitals in rural areas. People may be forced to travel long distances in order to receive the care they need and have it covered by their insurance. This is also bad news for people who are employed by rural providers and hospitals. With fewer patients, and insurance possibly no longer covering their services, many of these health care providers may lose their jobs or be forced to move. It is also bad for rural Maine because insurance companies can now charge people more based on where they live, how old they are, and what they do for work. Someone between 45-65, living in Aroostook County, who works on a farm, or as a logger or fisherman, can expect to see their rates increase significantly. One study by the Maine Center for Economic Policy estimates that rates for individual policy holders in Aroostook County will increase by 19% and group policies by 17%.
How could legislators pass a bill that will harm so many Mainers? It makes more sense when you consider who spent the most money laying the groundwork for this bill’s passage; and that’s Anthem. Wellpoint, Anthem’s parent company, was one of the largest contributors in the country to the Republican Governors Association, which helped Governor LePage get elected. Wellpoint and Anthem also gave hundreds of thousands of dollars to the Republican State Leadership Committee, the outside group that spent almost $400,000 on negative advertising to help Republicans gain control of the State Senate. And Anthem lobbyists lined the halls of our legislature every day in the lead-up to the passage of LD1333.
We explored the idea taking LD1333 to the voters through a People’s Veto campaign, and although we ultimately decided we didn’t have the capacity to undertake a ballot campaign, we are committed to overturning the attack on health care in Maine through the legislature, by electing new representatives and senators that share our values.
In the long term, MPA remains committed to building support for a universal single-payer healthcare system for Maine. There were actually two single- payer bills considered in the legislature this year. One bill, LD57, would update an existing study about how much it would cost to run a single-payer system in our state. It was voted “ought not to pass” along party lines (Democrats in favor, Republicans against) in the Insurance and Financial services Committee. Another bill, LD 1397 “An Act to Establish a Single Payer Health Care System to be Effective in 2017,” sponsored by Rep. Charlie Priest and co-sponsored by 55 others, was also voted “ought not to pass” on mostly party lines (Senator Diamond, D-Cumberland, voted with Republicans). Earlier this year, Vermont elected a Governor who campaigned on creating a single- payer system as a way to reduce costs and create jobs. Governor Shumlin has fulfilled that promise by signing into law a bill that creates a state-level single payer system that will go into effect in 2017 and cover all Vermont people. We’re eager to follow Vermont’s progress and to learn lessons for the single-payer movement here in Maine.
Finally, there is much work for our legislature to do in order to comply with the Affordable Care Act, the national reform law. By 2014, each state has to set up an “exchange” to serve as a health insurance marketplace that should lower costs and improve quality. Last summer a bi-partisan group of legislators met several times to learn about the exchange and they prepared a report detailing ideas for what Maine’s exchange should look like. This legislative session, two bills to establish a state exchange (one sponsored by Rep. Treat, D- Hallowell, and one by Rep. McKane, R-New Castle) were introduced, based on last summer’s report. The legislature passed neither of these bills and instead created a commission to further study an exchange and make recommendations to the legislature by September.
The bad news is that the members of this new commission are appointed by our Governor, and are not likely to share our vision for Maine’s exchange. There are three possible outcomes from this commission: the worst case scenario is that we end up with an exchange that does nothing to improve quality and lower costs, but instead serves as another handout to insurance companies. A less terrible scenario is that Maine decides not to set up an exchange at all, in which case the federal government will set one up for us. The other, best case scenario is that the commission and legislature agree that the findings of last summer’s joint select committee are accurate, and set up an exchange under those guidelines to improve quality, reduce costs, and make purchasing insurance easier. We’ll be sure to keep members informed about the outcomes of this process and opportunities for making your voice heard!