Wednesday, December 11, 2013
By Tom Bell firstname.lastname@example.org
AUGUSTA - The Maine Senate on Wednesday night approved an overhaul of the state's health insurance market, passing a bill that was amended to win some Democratic support.
PROVISIONS OF INSURANCE MARKET BILL
L.D. 1333 would overhaul Maine’s health insurance market for about 40,000 people – those who buy independently or through employers whose companies have 50 or fewer workers. It would:
• Allow companies from every other New England state except Vermont to sell insurance in Maine, beginning in 2014. Current law prohibits out-of-state companies from selling insurance here.
• Give insurance companies more leeway in how much they can charge policyholders based on age. Starting July 1, 2012, some people could pay three times as much for their policies as other people because of their age.
• Prohibit insurers from rejecting people for pre-existing conditions. It would create a mechanism for covering insurance costs of people with chronic illnesses.
The nonprofit Maine Guaranteed Access Reinsurance Association would subsidize the insurance of people who have high medical costs. It would be funded by a tax on premiums of as much as $4 per person per month on almost every policyholder in Maine. Legislators and state workers would be exempt from the tax.
Insurance carriers would cover policyholders’ first $7,500 in medical expenses per year. The nonprofit would cover 90 percent of the next $25,000 in expenses, and 100 percent after that.
• Repeal Rule 850, a section of Maine’s insurance code that requires insurers’ provider networks to have primary care physicians within a 30-minute drive of policyholders’ homes, and hospitals within an hour’s drive.
• Allow companies to band together and form their own insurance company to cover their employees. The insurance company would have to follow the same regulations as other insurance companies.
• Repeal the State Health Plan and eliminate the Advisory Council on Health Systems Development, a 20-member group that analyzes factors that drive health care costs and reports to the Legislature. Hospitals would be allowed to expand without complying with the cost containments provisions in the State Health Plan.
– Tom Bell
The final 24-10 vote came after two days of closed-door negotiations as leaders of both parties worked out a compromise.
Three Democrats -- Sens. Bill Diamond of Windham, Nancy Sullivan of Biddeford and Elizabeth Schneider of Orono -- voted with independent Sen. Dick Woodbury of Yarmouth and 20 Republicans to support the bill.
The House, which is expected to take up the bill this morning, will have to decide whether to accept the changes or send the bill back to the Senate in its original form.
"This bill has been made stronger because we worked together," Sullivan said.
Senate President Kevin Raye, R-Perry, said he was pleased that senators were able to listen to one another's concerns and pass a bill that had bipartisan support.
Democrats weren't the only lawmakers who had concerns. Some Republicans from rural areas had asked in caucus meetings for more time to study the bill's impact on rural residents and hospitals.
The compromise, Diamond said, allowed Democrats to win some modifications and gave some nervous Republicans political protection.
"If there are some problems, we all own it -- not just one party," he said.
The Senate was scheduled to take up L.D. 1333 Wednesday morning, but the vote was delayed until the evening to allow more time for negotiations and for the parties to hold caucus meetings. The final vote came at 9:41 p.m.
Diamond said he and Schneider met with Republican leaders on Tuesday and began discussing a possible deal.
They agreed to add wording to the bill to make it clear that insurance companies would have to pay for treatment at any hospital, although insurers could give financial incentives for people to go to hospitals they recommend.
The original bill, passed Tuesday by the House, would give insurers more leeway in how much they can charge policyholders based on occupation, place of residence and age. The Senate adopted an amendment that removed that added leeway for place of residence.
Sen. Troy Jackson, a Democrat from the Aroostook County town of Allagash, voted against the bill. He said he is worried that the changes would make it more expensive for his constituents to use hospitals in the county.
"You can't ask me to go back to Aroostook County not knowing what people are going to pay to go to those hospitals," he said.
Jackson was referring to a provision in the bill that would repeal Rule 850, a section of Maine's insurance code that requires insurers' provider networks to have primary care physicians within a 30-minute drive of policyholders' homes, and hospitals within an hour's drive.
Sen. Justin Alfond, D-Portland, said the bill had moved so quickly that state officials hadn't had time to complete an actuarial study to determine the bill's impact.
"We haven't run any numbers," he said. "We have no idea. We are blindly running down the path."
He urged the Senate to send the bill back to the Legislature's Finance and Financial Services Committee. But a motion to send the bill to the committee was defeated, 23-11.
Republicans said state regulations have made insurance premiums in Maine among the most expensive in the nation, causing many young and healthy people to forgo health insurance.
"Right now, Maine's insurance market is a failure," said Lois A. Snowe-Mello, R-Poland. "Unaffordable health insurance denies people access to health care. This is unacceptable."
The debate, which lasted more than four hours, was at times emotional.
Jackson choked up as he recounted how a trip to the hospital had saved his life.
Sen. David Trahan, R-Waldoboro, said angrily that the bill's opponents have been spreading false information, such as telling cancer patients that they would lose their insurance.
He said the bill would not allow insurance companies to deny coverage to people because of pre-existing conditions.
Nevertheless, he said, a man he knows from his district came to the State House to protest the bill.
"This man was getting treatment for cancer," Trahan said. "He was shaking. To look in that man's eyes was horrifying to me. ... This man was scared, trembling that his insurance would be taken away."
Raye, who sat with the rest of the Senate to join the debate, rather than chairing the meeting, said the bill would lower insurance costs while ensuring people access to health care.
"Maine people are reeling from the growing pressure of annual double-digit increases in the cost of health insurance," he said. "This is unacceptable."
Republicans say the changes would foster more competition in the health insurance market.
They say the reforms would encourage more young people to buy insurance, and that a larger pool with more healthy people would lower premiums for all groups.
The bill would create a mechanism for paying the premiums of people with chronic illness, by spreading the cost over more than 650,000 policyholders in Maine, rather than just 40,000 in the independent and small-group market.
The plan would be funded by a $4 per-person monthly tax on almost every health insurance policy in the state. The policies of state employees, including legislators, would be exempt.
A nonprofit group that would administer the program could increase the assessment. The Senate passed an amendment Wednesday to cap the assessment at $6.
MaineToday Media State House Writer Tom Bell can be contacted at 699-6261 or at: