Mainers are beginning to have second thoughts about Dirigo health care, the new state-run plan that looks like national health care, sounds like national health care, and acts like national health care.
While the rest of the country is embracing consumer-driven health care in the form of Health Savings Accounts, as we report on pages 6 and 7, Maine is about to capture thousands of residents in a state-run health care bureaucracy not unlike what has been tried and failed in Canada and England.
A Choice of One
Dirigo aims to establish an insurance program for the state’s 136,000 uninsured residents, pay for that program (at least in part), and keep people who aren’t uninsured in the system by cutting costs. But the state has been able to find only one insurance provider willing to offer the subsidized coverage. Out of a field of at least eight insurers, only one–Anthem Blue Cross and Blue Shield (BCBS)–has shown any interest.
According to the latest state brochure, uninsured residents can start signing up with Dirigo’s sole provider, BCBS, at monthly community-rated premiums as low as $260 for a single adult and $780 for a family of four. The state will subsidize deductibles and out-of-pocket maximums, and discount by up to 40 percent the monthly premiums incurred by enrollees under 300 percent of Federal Poverty Level (FPL) which currently comes to $28,000 for a single adult and $56,500 for a family of four.
A Question of Fairness
Even before the plan takes effect, Mainers are beginning to wonder whether the proposed Dirigo health care plan will be implemented fairly.
Some Maine residents have expressed fear the Dirigo plan will be biased in favor of urban areas once the state has full control and makes future decisions about investment in health care. Exactly that has happened in Canada, where residents of the less-populated Canadian provinces complain their health care access is routinely sacrificed in favor of the country’s population centers.
The price Maine residents pay for health care services already varies significantly depending on where they reside. That’s not surprising, since the availability of health care services and cost of living generally vary by location. But it may lead Mainers to question the “fairness” of the state’s health care system.
Cost Spiral
Maine has launched an experiment not unlike experiments that already have failed badly in Kentucky, New Jersey, Tennessee, and Washington. As reported in previous issues of Health Care News, those states have experienced health insurance premiums so outrageously high that businesses moved out and people were forced to rely on the only affordable game in town, taxpayer-subsidized Medicaid. Even after cutting back on benefits, increasing co-payments, and raising eligibility rules, those states could not keep their Medicaid systems solvent and had to raise state income taxes. A temporary drop in health insurance premiums became a permanent increase in state taxes, with no improvement in access to health insurance.
IT Gap
The most controversial piece of Dirigo is the Capital Investment Fund, which will essentially create an annual global budget for all state health care investment under the existing state approval process known as certificate-of-need. The plan will outlaw the creation of new hospital beds and other projects that allegedly duplicate services or facilities in a region or community.
Most concerned, not surprisingly, are the hospitals, whose representatives say they are being unfairly characterized as having costs above the national norm. Little has been said about how the state spending cap will affect hospitals’ ability to take advantage of twenty-first century information technology that hospitals outside of Maine are already gearing up for.
Individuals in Maine state government circles say Governor John Baldacci (D) sees the successful implementation of Dirigo as an important part of his legacy. Is he willing to be held accountable if the program fails?
Conrad F. Meier is managing editor of Health Care News. His email address is [email protected].
