Although its fate in the U.S. Senate is far from certain, Thursday’s narrow passage of the Republican-led American Health Care Act has prompted lawmakers and industry officials in Maine to begin thinking about how a new law might be implemented here.

Democrats have been deeply critical of the plan, saying it could make health insurance unaffordable for many people, including those who are ill, elderly or have pre-existing conditions.

Republicans are optimistic that the law would give states like Maine more flexibility and increase competition that they say would help drive down rates for everyone. They also say the state is in a good position to adopt a so-called high-risk pool to subsidize insurance for low-income people because it already had a system in place, Public Law 90, prior to the passage of the Affordable Care Act.

“When the ACA passed, it trumped PL 90, but for a year or so many people saw reductions in their private insurance premiums,” said Rep. Deborah Sanderson, R-Chelsea, the ranking House Republican on the Health and Human Services Committee. “The initial results were positive.”

PRE-EXISTING CONDITIONS ARE KEY

One major sticking point in the AHCA, which passed the House 217-213 on Thursday, is how it could adversely affect those with pre-existing conditions. Amendments were included in the bill last week that would replace the protections for those individuals under the Affordable Care Act with federally funded high-risk pools that subsidize care.

One of the ACA’s most popular provisions prevents insurers from rejecting people or charging higher rates based on their health.

Under the House bill, states could apply for federal waivers that would allow insurers to charge higher premiums to people with pre-existing illnesses who have let their health insurance lapse. They would then receive federal money to fund government-operated insurance programs for expensive patients called “high-risk pools.”

Opponents of the House bill say that means people with pre-existing conditions could be priced out of purchasing insurance plans altogether. The nonpartisan Congressional Budget Office has yet to analyze the cost of the AHCA, but health experts say premium costs could skyrocket, with estimates on illnesses ranging from an additional $4,000 for asthma to $142,000 for some cancers.

Whether Maine would apply for a waiver, or how state officials would apply, is still uncertain. Maine, like many states, has a law that prevents insurers from charging higher premiums or denying insurance based on pre-existing conditions.

The question, however, is whether Maine would first need to repeal that law to implement the provisions of the AHCA, or whether the federal waiver effectively eliminates the state law.

“It’s a good question,” said Emily Brostek, executive director for the health care advocacy group Consumers for Affordable Health Care. “It looks like it will be up to the states.”

The law also says that the “state” could apply for a waiver, without specifying whether a governor could apply, or whether legislative approval would first be needed.

Under the AHCA, federal spending on Medicaid would also be cut by an estimated $880 billion over the next 10 years.

Sanderson, the state representative from Chelsea, said that because Maine already has made cuts to the program and did not expand it, as some states did under the Affordable Care Act, it’s better positioned financially than those that would lose those funds.

She also said that if Maine were to obtain a waiver to run its Medicaid program, known as MaineCare, like a block grant, it could prioritize the most vulnerable people, such as the elderly and disabled.

Democrats, however, say the AHCA would be catastrophic for the vulnerable for several reasons.

“The idea that Maine wouldn’t be affected as much because we didn’t expand Medicaid, that’s just wrong, wrong, wrong,” said Sen. Geoff Gratwick, D-Bangor, a retired physician. “It may be correct financially but we’re talking about people. I think it’s unconscionable.”

OLDER, RURAL RESIDENTS AT RISK

Under the House bill, older Mainers in rural areas could see their premiums increase up to seven times what they’re paying under the ACA, going from about $200 to $300 per month to about $1,300 per month, the Kaiser Family Foundation says.

Cuts to insurance subsidies and tax credits could cause some members of Community Health Options, which provides health plans under the ACA in Maine, to drop their policies, said Kevin Lewis, the company’s president and chief executive officer. About 24,000 Mainers receive subsidies under CHO individual plans.

Brostek said that assessing the potential impact of the AHCA in Maine is difficult because so many questions remain – and the legislation hasn’t even gone through the Senate, where it is almost guaranteed to be changed.

“In health care policy, there are always winners and losers,” she said. “We need to understand who’s going to be better off and who’ll be worse off. It certainly matters a great deal if the people who need health care the most are the least able to access it or afford it.”

Already, a major concern about the high-risk pools is whether there would be enough money to fund them.

“The concern is that the funding will be insufficient to finance the high-risk pool,” CHO’s Lewis said.

An analysis by the health care consulting group Avalere found that the amount that the AHCA allocates over nine years to create high-risk pools would cover only 110,000 of the estimated 2.2 million people with pre-existing conditions who have ACA insurance.

“Shared risk isn’t a terrible idea, but I’m not confident it would ever be funded adequately,” Gratwick said.

Brostek worries about people who would be stuck in the “family glitch,” the term used for people who make too much to qualify for an ACA subsidy or free care, but who can’t afford the high cost of treatment for a serious injury or illness such as cancer.

Sanderson believes the high-risk pool option would work in Maine, in large part because it’s based on PL 90, which was in place for about 18 months before being supplanted by the ACA.

That law, pushed by Gov. Paul LePage and legislative Republicans, set up a high-risk pool and subsidized the insurance with a fee on all individual health insurance plans in Maine. That law also loosened the rules on insurance carriers that sell coverage to the thousands of Maine companies with fewer than 50 workers – the so-called small-group market.

While conservatives argued that PL 90 was working and lowering insurance rates in Maine, critics said it gave insurance companies too much latitude to raise rates for companies with older workers or those in rural, high-cost health markets, while lowering rates for younger, urban companies that tend to have lower health care costs.

HIGH-RISK POOL’S EFFECT UNCLEAR

But since the law was in effect for only a short time, its actual success or failure – or whether there was enough money in the pool to cover people – can’t be assessed.

PL 90, however, was always intended to work in concert with the Maine law mandating that insurers provide coverage for people with pre-existing conditions.

Sanderson said she has always been critical of the Affordable Care Act because she believes its cost is simply not sustainable.

“Good policy isn’t always fiscally appropriate,” she said. “You have to set priorities.”

The conflict comes when lawmakers have to decide who is most vulnerable and who needs the most help getting health care.

“I believe it should be people who have no choice – people who are elderly and people who are disabled,” she said. “There are no easy decisions either way.”

Gratwick said it’s clear to him that the AHCA’s provision that allows insurers to charge higher premiums for older individuals and those in rural areas could have a massive impact on Maine, the nation’s oldest state and one of its most rural.

Brostek said it’s hard to assess the impact of a health policy that, by almost every account, is likely to change in the Senate.

And even if it doesn’t, she said, “Any changes would not take place the next day, so there would be some time to sort this out.

“But the uncertainty is really troubling.”

Correction: This story was updated at 3 p.m. on May 6 to correct the amount of Medicaid spending that would be cut under the AHCA.

Eric Russell can be contacted at 791-6344 or at:

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