March 20, 2009
Maine Residents Deserve Choice in Health Insurance

By Rep. Jonathan McKane

The Maine health insurance deadlock continues. As a state legislator, I get complaints regularly from families who have to increase their deductibles to a ridiculous level or drop coverage altogether.

It’s no wonder. Maine families and individuals pay a higher percentage of their income for health insurance than anyone else in the country, while our deductibles are seven times the national average. The budgets of Maine businesses are strained to the breaking point, too. Our unnecessarily high health insurance costs are considered by the state’s employers to be one of the top three negative economic influences when they were polled by Market Research Insight in 2008. Extreme costs for insurance mean companies create fewer jobs.

We need health insurance reform in Maine now, and we need the choices offered by other states. I have submitted legislation to do both.

Over the past year, there has been a lot of publicity concerning a referendum that would have allowed Maine people to purchase health insurance from out of state. Unfortunately, there were thousands of double signatures which ultimately left the initiative short; but more than 50,000 valid signatures were counted. One can only imagine how this referendum would have turned out, especially now with another exorbitant rate increase from our near-monopoly health insurer, Anthem Blue Cross.

On March 13, we learned of an outrageous MaineCare budget deficit of $235 million that will have to be paid up by the end of this fiscal year. Additional shortfalls in following years are anticipated because of the ease of qualifying for MaineCare, because of our extremely high cost per MaineCare enrollee (double the national average) and because of overutilization.

Also, as the state continues to fall behind in its MaineCare payments to health care providers, costs must be shifted to other payers. This leads once again to higher health care costs and then to higher insurance premiums.

Meanwhile, Maine continues to expand the number of people on MaineCare. We now have the highest percentage of our population on Medicaid in the country, while the number of Maine people on private individual insurance continues to drop. We have more than three times the number of individuals on MaineCare than are on private insurance.

We need to move people from “free” government health care, which is breaking our state’s budget and costing state and federal taxpayers $2.4 billion per year. Few people really want to be on medical welfare, but we force Maine citizens into making this decision because our over-regulated, monopolized health insurance market has been priced out of reach for the average working family.

So how do we do that? There are a number of things we can do to address this appalling situation, including addressing the cost of health care itself. But the first and most obvious thing we can do is change some of the insurance laws and regulations that got us into this mess. We can do this while still caring for those who need chronic care.

We need to give our citizens choice – the choice to buy the policy we want at a price we can afford. Not everyone wants or needs the costly “Cadillac” policy mandated by the Legislature, and which legislators themselves receive. This choice, including the option of purchasing health insurance out of state, would be one quick way to bring competition back to Maine’s monopolized and failing health insurance market. Competition vanished many years ago when the mandates of guaranteed issue and community rating were first foisted upon us as “consumer protection.”

In Maine, for example, only two companies sell health insurance to individuals. Of those two, Anthem sells 60 percent of the policies. In New Hampshire there are 11 companies; in Connecticut there are nine; and in Massachusetts there are 21. Just imagine if Maine people suddenly had the choice of dozens of companies and plans to choose from. Needless to say, in states where there are large numbers of companies competing for your health insurance dollar, premiums are significantly lower.

Considering the deplorable condition of Maine’s health insurance industry, considering that Maine peoples’ deductibles are seven times the national average, that Maine people pay the highest percentage of their income for health insurance, that we have the highest percentage of our population on medical welfare, and that our mono-culture health insurance industry is utterly dependent on the well-being and private decisions of one company (Anthem), can we wait any longer?

It is time to give the Maine people what they have been demanding for years. We are all tired of waiting.

State Representative Jonathan McKane represents Edgecomb, Newcastle, Damariscotta, Bristol, South Bristol and Monhegan and is serving his third term.

###