The Rate Hike Law

In the year since Public Law 90 passed, Lisa Burton, who along with her husband owns Reel Pizza Cinerama in Bar Harbor, has seen health insurance premiums for her business and its employees increase by more than 95%. A 46% increase last year was followed by a 66% increase just days ago.

"I'm frustrated. It's a hard thing to swallow - the nearly doubling of your rate. We're trying to do the right thing by offering coverage for our employees, but it can really put you under," said Burton, whose business employs the equivalent of 12 full-time workers. "We're good at keeping other costs down, but I have no control over this."

Burton's increases are coming despite an already high deductible under her plan. After her son broke his arm a few weeks ago, medical care costs quickly surpassed $3,000 in out-of-pocket expenses and he isn't yet out of his cast.

Increases like this one for small businesses in every corner of the state give lie to the claims by insurance companies like Anthem and right-wing lobby groups like the Maine Heritage Policy Center, which claimed that less government oversight of insurance companies would lead to lower rates.

"For Anthem to pick and choose a few rate decreases in the individual market for young people or for new plans that provide miniscule coverage and huge deductibles and attempt to portray those numbers as representative across the state is outright fraudulent," said Maine People's Alliance communications director Mike Tipping. "Of course they don't mention that they're jacking up rates on middle-aged Mainers and small businesses by 30, 50, and sometimes 70 percent or more in a single year."

After Jim Miller, of WoodenBoat Publications Inc. in Brooklin, faced a huge rate increase last year, they cut back on the plan for the business, which covers 31 employees. Even with less coverage and an already high deductible, about a month ago he was faced with a rate increase of more than 32% and an increased cost of $75,144.

"This increase is a huge problem for us. I've said for a while that I'm running out of bunnies to pull out of the hat. Now, I'm completely out of bunnies. I don't know what we'll do in the future," said Miller. "They're basically selling health insurance based on your zip code and your age and for this company, based in Brooklin, Maine, both of those are going against us."