Universal Health Care Initiative – Maine

DIRIGO HEALTH is Maine’s universal access to health coverage plan. The new law is a plan to provide affordable health insurance to small businesses and individuals and to control health care costs. The legislation offers a phased-in approach with an ultimate goal to ensure that all of Maine’s citizens have access to health care by 2009.

The first step is the DirigoChoice health plan, which began providing coverage in January 2005. By mid-February more than 3000 individuals from 2500 small businesses and 1000 sole-proprietorships had enrolled. Enrollment is expected to be about 31,000 in the first year, and another 110,000 individuals by 2009. Coverage is available to uninsured individuals, businesses and municipalities with 50 or fewer employees, and the self-employed. In Maine, more than 90 percent of employers are small businesses.

The package of benefits includes 100-percent coverage of preventive care, and no exclusions for pre-existing conditions. High- and low-deductible plans are offered. DirigoHealth coverage is offered through a private health insurance carrier, Anthem, which bid for the business and negotiated a contract with the state.

People with incomes under 300 percent of poverty ($55,000 for a family of four) are eligible for sliding scale payments. Employers are required to contribute 60 percent of premiums, including the cost for those who are eligible for Medicaid.

Thefirst year of Dirigo Health will be funded with contributions from enrolled individuals and small businesses, federal matching funds for low-income families (those below 200% federal poverty guidelines), and with about $53 million in one-time state funds. 

Inthe second year of operation, the state funds will be replaced by an assessment on insurers’ premiums, not to exceed 4 percent. This does not require insurers to raise their rates; it is money that they currently attribute to losses from uncompensated care. The payment will be determined annually, based on savings to Maine’s health care system that will result from a reduction in the amount of bad debt and charity care currently provided to the uninsured. If, after three years, the trend in premium reduction and trend of uninsured reduction of uninsured in Maine exceed the same trends among 31 states with high-risk pools, legislation will be introduced for a high-risk insurance pool in Maine.

The Dirigo legislation introduces other cost control measures to the state’s health care system. The Governor will be required to issue a State Health Plan and state health budget every two years, which will address the development of health care resources in Maine based on statewide access, cost and quality goals. Providers are required to give patients an itemized bill, so they can see the costs of health care. There will be strengthened oversight, review and approval of small and large group insurance rate filings by the Superintendent of Insurance, including in some cases, public hearings and actuarial reviews. The Certificate of Need (CON) process has been strengthened to ensure more rational development of health care services and to contain costs. Capital expenditures on new facilities, equipment, or offering new services that exceed a cost threshold must be authorized by the state.

Oneof the co-authors of the original Dirigo legislation recognizes that it"in its current form is not the panacea some pundits were predicting." He advocates three changes to the plan: the requirement that all citizens participate (an end to the voluntary aspect of the program), movement away from employer-provided coverage, and "a return to the concept of insurance as coverage for the unexpected and unaffordable."(Chris O’Neil, Portland Herald Press, January 20, 2005.)

Maineis now making "good paying jobs with benefits" and "affordable, accessible, high quality health care for all Maine citizens" part of its strategy to improve the state’s economy.

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