June 8, 2011

Bill would end Maine lawmakers' exemption from health insurance tax

The insurance reforms don't make legislators pay the $4 monthly tax, but Republicans now think they should.

By Tom Bell tbell@pressherald.com
Staff Writer

AUGUSTA — For critics who want to overturn Republican-backed health insurance reforms, one compelling argument is the fact that everyone with health insurance in Maine must pay a monthly tax of as much as $4 – except federal and state workers, including legislators.

During debate on the bill in the Senate last month, Republicans rejected Democrats' attempts to remove the exemption for lawmakers. Now that L.D. 1333 is law, Republicans want to remove it.

On Monday, Sen. Richard Whittemore, R-Skowhegan, submitted emergency legislation to require that lawmakers pay the tax. "I think that's the fair thing to do," he said.

The $4 tax will subsidize insurance for people who have pre-existing conditions and buy insurance independently or in the small-group market.

During last month's debate, Republicans recognized early on that the exemption for lawmakers was a problem, Whittemore said. They decided to fix the bill later rather than delay the vote.

Whittemore's bill, L.D. 1580, calls for insurers to send bills for the tax directly to lawmakers. Legislators can join the same health plan as state employees, and the state pays the premiums.

Republicans say the reforms will make Maine's health insurance market more competitive and lower rates.

Democrats are considering a people's veto campaign to repeal the law, which they say will increase health insurance costs for older people and cause people in rural areas to travel farther for medical procedures.

Whittemore's bill would strip away an "easy shot" against the law, but wouldn't make the law less burdensome for people whose rates will increase, said Ben Grant, chairman of the Maine Democratic Party.

The Legislature's Insurance and Financial Services Committee will hold a public hearing on L.D. 1580 on Thursday, said Whittemore, who co-chairs the committee. The bill has several Democratic co-sponsors and is expected to win approval with bipartisan support.

 

MaineToday Media State House Writer Tom Bell can be contacted at 699-6261 or at: tbell@mainetoday.com

 

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