May 6, 2011

Stakes high as House backs insurance bill

Republicans say the overhaul would lower prices for all; Democrats say it will be 'disastrous' and divide the state.

By Tom Bell
Staff Writer

AUGUSTA - In a straight party-line vote, the Maine House gave preliminary approval Thursday to a bill that would overhaul Maine's health insurance system, despite Democrats' objections that Republican leaders are pushing through a reform package that would hurt older people, especially those who live in rural areas.

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Read the full text of the bill

The 76-72 vote was the first round of a partisan battle that will ramp up in the next few days as supporters and opponents pressure lawmakers on the issue. The Senate will take its first vote on the bill Tuesday, with the House taking its final vote the same day.

LD 1333 would strip away state regulations that have been put in place over the past two decades and open the individual and small-group insurance market to more competition. It also would give insurance companies more leeway in how much they can charge policyholders based on age, occupation and place of residence, and whether they smoke.

The bill also would repeal a state law that prohibits insurance companies from requiring policyholders to travel to hospitals in other parts of the state for medical procedures.

By encouraging competition among hospitals and lowering medical costs, the repeal would lead to lower premiums for everyone, Republicans say.

The legislation would affect only people who buy insurance independently or through employers whose companies have 50 or fewer workers.

There is a provision to allow companies of any size to band together to essentially create their own insurance company.

The bill would allow companies from every other New England state except Vermont to sell insurance in Maine. Current law prohibits out-of-state companies from selling insurance here.

Democrats said the bill would raise premiums for older people who live in rural areas and jeopardize the viability of rural hospitals. They also complained that lawmakers and the public have had little time to understand the complex 45-page bill, which was reworked Wednesday and was not posted online until late Wednesday night.

Democrats noted that the Legislature spent more time in this session debating a bill that made whoopee pies Maine's official state treat than discussing the biggest change to the state's health insurance system since the early 1990s.

Adding to the drama Thursday, more than 70 demonstrators lined the hallway outside the House chamber and chanted "Read the bill!" and "Please vote no!" as lawmakers walked past them to reach their seats.

During the floor debate, Republicans for the most part sat silent as numerous Democrats lashed out at the bill. Sen. John Martin, D-Eagle Lake, warned Republicans from rural districts that they will pay a heavy political price for supporting a bill that would be "disastrous" for rural Maine.

If the bill passes, he said, insurance companies will force people who live in Aroostook County to drive to Bangor for medical procedures.

"Vote for it," he told the Republican lawmakers, sarcastically. "I will be happy to go to your communities. I will go to Houlton. I will go to Machias. I will go to Norway. I will go to Caribou. I will go to Presque Isle, and I will hold regional meetings to discuss your vote."

Rep. Stephen Lovejoy, D-Portland, said the bill would lower insurance premiums for people in Cumberland, York and Androscoggin counties because the population in those counties is, on average, younger than in northern counties. In addition, he said, his constituents live close to the state's largest hospitals and wouldn't have to go far to get medical care.

Nevertheless, he said, he will vote against the bill because it would hurt the state as a whole.

"It will divide this state even more and hamper economic development in northern Maine," he said.

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