AUGUSTA – House Republicans are poised to give preliminary approval today to a bill that would overhaul Maine’s health insurance system, despite critics’ objections that GOP leaders are moving too quickly.

Republicans presented a new version of the bill Wednesday, attempting to address some of the criticism.

L.D. 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.

The bill would end the prohibition on buying insurance across state lines, and would allow companies of any size to band together to essentially create their own insurance companies for employees.

Groups representing doctors, community health centers and consumers say the bill is moving too fast, leaving them little time to understand its potential impact or even get feedback from their members.

Gordon Smith, a lobbyist for the Maine Medical Association, which represents 3,500 doctors, said Republicans appear ready to pass the bill without any Democratic support — something that has become common in Congress but is rare in Augusta for significant legislation.

Although Republicans may succeed politically in the short term, he said, they are taking a long-term risk.

“It has not been done in a responsible manner,” Smith said of the bill. “It will confuse the heck out of consumers, providers and the insurers themselves. It will be a lawyer’s dream.”

But Rep. Jonathan McKane, R-Newcastle, a member of the Legislature’s Insurance and Financial Services Committee, said lawmakers are familiar with the concepts behind the bill because similar legislation has been submitted year after year and rejected by Democratic majorities.

“There is no sense to delay,” he said. “The sooner we get this going, the better.”

Sen. Rodney Whittemore, R-Skowhegan, the House chair of the committee, said the bill is important to the 130,000 to 140,000 Mainers who don’t have health insurance now because they can’t afford it.

“This has been a long time coming,” he said. “It’s nothing new.”

The bill would change rules that limit how much insurers can vary policyholders’ premiums based on age, occupation and place of residence.

State law now limits the range between the highest-risk policyholder and the lowest-risk policyholder to a ratio of 1.5 to 1.

The GOP bill would expand the ratio to 3 to 1 next year and 5 to 1 by 2015, meaning the highest-risk policyholders could be charged five times as much as the lowest-risk policyholders.

The legislation wouldn’t affect people who are insured through employers that have large-group plans.

Sen. Sharon Treat of Hallowell, the lead Democrat on the Insurance and Financial Services Committee, said older residents in rural areas would see their insurance rates increase substantially. But McKane said he’s convinced that even older policyholders would end up with lower rates than what they pay today.

He said the current restrictions have increased the cost of insurance for all groups because many young and healthy people have decided to forgo insurance. Because the remaining people who buy insurance are older and sicker than the general population, their insurance costs are much higher, he said.

One issue is what to do about people who have pre-existing conditions.

When the committee endorsed the bill Friday in a party-line vote, the bill essentially called for a high-risk insurance pool for those people, who would choose from among five insurance plans.

To keep their out-of-pocket costs the same as everyone else’s, a nonprofit would be formed to subsidize their higher costs by taxing the premiums paid by everyone else, with a maximum of $4 per month per person.

Democrats objected to the idea of segregating people with pre-existing conditions into separate plans. On Wednesday, Republican leaders gave the committee a revised bill that removed that provision.

The revised bill would still create a nonprofit to subsidize insurance for the high-risk population using the maximum $4 tax on premiums. But people with pre-existing conditions would have the same insurance options as everyone else, and wouldn’t even know that their insurance is being subsidized.

The revision includes numerous other changes to comply with federal law. As a result, a bill that initially was three pages long, then expanded to 24 pages last week, grew to 45 pages on Wednesday.

House Minority Leader Emily Cain, D-Orono, said the changes transformed a “terrible bill” into a “bad bill.”

She said Republicans may have violated legislative rules that prevent a committee from making substantial changes to a bill it has voted on unless a motion to reconsider and amend it is approved at a committee work session.

Whittemore said he doesn’t think the changes are substantial.

Lance Dutson, spokesman for House Speaker Robert Nutting, noted that the changes made the bill more appealing to Democrats. “It’s not like we slipped something in and made it more draconian,” he said.

Nutting said the House will likely take a preliminary vote today. A final vote wouldn’t occur until next week.

At the end of the Insurance and Financial Services Committee’s meeting Wednesday, Treat was obviously upset.

As she left the room, she spoke to a lobbyist from Anthem Blue Cross and Blue Shield and a staff member from the Maine Bureau of Insurance.

“I am steamed about the process,” she told them. “I really am.”

 

MaineToday Media State House Writer Tom Bell can be contacted at 699-6261 or at:

tbell@mainetoday.com