Business groups in Maine have sharply diverging positions on the Nov. 7 referendum to expand Medicaid, with some viewing it as a source of economic benefits and others as a precursor to a tax increase. Still others are undecided.

The contrasting views were apparent Tuesday when the Maine Small Business Coalition, which claims to have 3,000 members, threw its support behind Medicaid expansion, which will appear as Question 2 on the ballot. The coalition said that 150 of its members are publicly supporting the effort.

The coalition, which weighs in on public policy initiatives that affect small businesses, is affiliated with the Maine People’s Alliance, a progressive group that helped to gather the voter signatures to bring the proposal to referendum.

Will Ikard, coalition director, said small businesses that employ low-wage workers often can’t afford health insurance for their employees, even if they want to provide it. Ikard said Medicaid expansion is not only a moral issue, but it would also be helpful to small-business owners because they would have healthier, more productive employees.

Tim Soley, owner of Hyatt Place Portland, which hosted the news conference where the coalition announced its support, said there are “compelling moral, philosophical and business reasons demanding it.” Soley said that by forgoing Medicaid expansion, Maine is “shipping tax dollars off to wealthier states.”

Others oppose the expansion, including the National Federation of Independent Business. David Clough, director of the federation’s Maine chapter, which claims 3,000 members, said “members are concerned about how expansion will be financed and 94 percent of the members expect a future tax increase is lurking in the shadows if expansion passes.”

Dana Connors, president of the Maine State Chamber of Commerce, said the chamber has not yet taken a position, but a committee has been formed and will make recommendations to the full chamber board next week.

Expansion would make an additional 70,000 Mainers eligible for Medicaid, on top of the 265,000 who are currently enrolled in the program, which provides health coverage for low-income people. The new beneficiaries could have incomes up to 138 percent of the federal poverty level, which is $16,643 for a single person or $22,412 for a family of two.

Maine is one of 19 states – and the only New England state – that haven’t expanded Medicaid. Attempts by the Legislature to do so have been vetoed by Gov. Paul LePage, a steadfast opponent of expansion. As a result, supporters organized and put the issue on the ballot. Medicaid expansion is part of the Affordable Care Act, and while initially it was mandatory, a U.S. Supreme Court decision in 2012 required the federal government to give states the choice about whether they wanted to participate in Medicaid expansion.

LePage contends that Maine can’t afford to expand the program, which is called MaineCare in the state. Under his administration, the state has tightened eligibility for MaineCare for some adults.

The federal government pays for about 90 percent of Medicaid expansion costs, which advocates point to as a selling point. But LePage and other opponents say they doubt the percentage will stay that high over time, and that the 90 percent figure doesn’t take into account the cost of implementing the program.

The Maine Center for Economic Policy, a left-leaning economic think tank, has estimated that 3,000 new jobs would be created in Maine if Medicaid were expanded.

However, Brent Littlefield, a spokesman for the Welfare to Work Political Action Committee, which opposes Question 2, said expansion would crimp Maine’s budget and force the state to make difficult choices, such as whether to fully fund removing people from state waiting lists who are in line for disabled services. If instead Maine decides to raise taxes, that would hurt businesses, said Littlefield, who is also the governor’s chief political adviser.

“When the state of Maine is faced with that large of a bill, there’s only two things they can do: cut the funding for the programs or taxes go up,” he said.

Cate DiMarzio, an expansion supporter who owns a Yarmouth behavioral health counseling business, said some of her clients move on and off of Medicaid, depending on their income and when Maine changes eligibility requirements. DiMarzio said when one of her clients loses insurance, she tries to keep seeing them anyway, but it’s difficult for her bottom line.

“That’s a good way to give back to the community, but I can’t carry too many of those (uninsured clients),” DiMarzio said.

The Maine Hospital Association, which announced its support on Sept. 29, says the state’s 36 hospitals are hurting as a result of the state’s failure to expand Medicaid. Nineteen hospitals are operating in the red, according to the MHA.

“There is no other viable option for health insurance coverage for many of the individuals who will benefit from expansion. For many, it is Medicaid or nothing,” the MHA said in a statement.

Maine’s Medicaid population has declined from 350,000 in 2011 to 265,000 in 2017, largely because the LePage administration has reduced eligibility for childless adults and parents. Also, as people acquire jobs and get insurance through the workplace or the Affordable Care Act, they drop off of Medicaid. Maine’s uninsured rate has fallen from 16.1 percent in 2013 to 9.1 percent in 2016, according to the latest Gallup poll.

The LePage administration has also submitted a controversial waiver request that, if approved, would impose work or volunteer requirements to maintain Medicaid and charge premiums for low-income enrollees.

If the U.S. Department of Health and Human Services approves the waiver, Maine would charge a $14 monthly premium for those earning less than 100 percent of the federal poverty limit – about $20,000 for a family of three – and $43 for those earning between 100 and 200 percent of the poverty limit.