While state leaders focus on Dirigo Health and a $44 million assessment to keep the subsidized insurance program – currently covering 9,000 people – afloat, Maine has close to 263,000 residents on Medicaid and the budget for this year will top $660 million.

And, that’s just the state’s share. The real figure is more than $2 billion, when federal matching funds are added.

According to the latest figures from the Kaiser Foundation released at the end of last year, Maine has 20.8 percent of its population on Medicaid making it number one in the country in terms of the percentage of people enrolled. New Hampshire, by comparison, is the lowest with only 6.8 percent of its population on Medicaid.

That comparative data is based on numbers reported for 2003 to 2004, but the totals for Maine haven’t changed much. The state Office of Fiscal and Program Review reports 262,871 people were enrolled in Medicaid as of last month.

Senate President Beth Edmonds said she believes Dirigo Health, or more accurately its insurance program DirigoChoice, is getting most of the attention because of politics in a re-election year for Gov. John Baldacci.

“I think it’s a partisan issue,” she said. “It’s a signature piece of his administration and it’s innovative and challenging. The angst is about trying to say ‘has he done a good job or hasn’t he?’ about healthcare,” she said.

Conservatives see a different motivation.

“It’s the only thing they’ll talk about in Augusta,” said Tarren Bragdon of the Maine Heritage Policy Center, “because it changes the subject” away from healthcare issues the administration can’t solve.

Medicaid also stays out of the limelight because every dollar spent by the state leverages two more from Washington. And, 42 percent of those enrolled are children and another 27 percent are either elderly or disabled – all vulnerable populations that legislators are reluctant to touch.

Subsidies for those who subscribe to DirigoChoice – an insurance program targeting small businesses and individuals – attract no federal dollars, although the designers of the program had predicted they would.

The administration hoped that as many as 15 percent of the enrollees would be Medicaid-eligible, and their employers would sign them up and pay part of the premium. With a two-to-one federal match of Medicaid expenditures on top of the employer-paid premium, these participants were expected to make Dirigo money.

It never happened. Instead only 1 percent of those enrolled were Medicaid-eligible in 2005.

To prime the pump for those eligible enrollees, the legislation that created DirigoChoice also authorized two expansions of Medicaid – one raising the income eligibility for childless adults to around $12,000 annually, or 25 percent above what the federal government defines as poverty. The other was for parents, raising their income cap from 150 percent of poverty to 200 percent, or $38,700 for a family of four.

The first expansion never took place because the number of childless adults, who entered the Medicaid program when it was opened up to them in 2002, exceeded all expectations. That program, which originated in the King administration, hit enrollments of close to 25,000 before it was cut off. It proved to be very expensive because of the pent-up needs of the population it serves, and the Legislature is being asked to cap its enrollment at the current level of 12,850.

The expansion for parents, whose children already are Medicaid-eligible, did go ahead last year and 4,794 people have enrolled. The administration is counting those new Medicaid recipients in their overall Dirigo Health numbers even though they’re not part of the DirigoChoice program.

The administration also wants to use fees being assessed to pay for DirigoChoice to pay for the state’s share of expanded Medicaid coverage for parents. Those fees and their use to expand Medicaid are being challenged in court.

The Legislature this session also is considering a separate expansion of Medicaid to a small group of disabled adults, who want to work.

The bill passed the Senate along party lines but is stuck in the House while Democratic leaders try to corral votes. It would exempt so-called unearned income, which is largely Social Security benefits, from the Medicaid income cap so disabled people in the state could work and still be eligible for coverage. The state says 826 people would be affected by the change, and it would cost an estimated $2.5 to $3 million.

Sen. Art Mayo, D-Sagadahoc County, chairman of the Health and Human Services Committee, supports the bill, saying it would allow people with disabilities, who want to return to work, to do so without losing their health insurance.

Sen. Richard Nass, R-York County, a member of the Appropriations Committee, counters that Maine has the highest percentage of its population already on Medicaid and one of the lowest per-capita incomes in the nation.

“This is no longer about dignity or ability to work, it’s about our ability to sustain this system,” he said. “Dignity is a nice thing, but if this system is going to collapse, why aren’t we shoring up this system?”

Sen. John Martin, D-Aroostook County, countered, “If I had my wish I’d want the system to collapse completely so we could have universal health insurance.”

He said his goal was “hopefully, in the long run, to cover everyone in Maine. If we’d stop this fighting between all the groups in Maine, we might be able to achieve that.”

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