AUGUSTA –  House Democrats today offered numerous proposals to try to blunt the impact of a reckless Republican plan, LD 1333, to overhaul Maine’s health insurance laws that will drive up costs for the sickest Maine people, those living in rural areas, and anyone over age 48.  Republicans rejected the six Democratic amendments to the proposal, refusing to reach reasonable compromise with House Democrats.

“Republicans have sent a strong message to Maine people that they won’t listen, compromise, or even explain their position on one of the biggest issues facing us this session – affordable health care,” said Rep. Emily Cain of Orono, the House Democratic leader.

The measure passed largely along party lines in a vote of 78-68.

Cain added, “Doctors, hospitals, business groups, patients – they all came to us and said this health care proposal is bad for us. But Republicans ignored them. They ignored us. They ignored real compromise. That’s disappointing.”

Democratic Rep. Don Pilon of Saco presented an omnibus amendment that would eliminate the flat tax on Maine people that funds the reinsurance pool and replaces it with a rate determined by the Bureau of Insurance after it conducts an emergency study of Maine data on the real cost of such a pool.

The amendment also would have used the reinsurance pool funds to cushion the blow of rate increases resulting from the increase in the range of rates insurance companies are allowed to charge based on where you live, where you work, and your age. The amendment also brought the range of rates insurance companies can charge in line with 3 to 1 ration in federal law.

“We presented a fair and moderate compromise in line with free market reforms that rejected an unfair tax,” said Rep. Pilon. “We tried to blunt the negative impact this bill will have on Maine people, but Republicans unilaterally rejected our effort and will be unilaterally responsible for the devastating effects it will have.”

Democrats also introduced amendments that would have prevented insurance companies from forcing Maine people to travel far distances to receive cheaper care.

“The repeal of the geographic access rule is the worst provision in this bill for rural Maine,” said Democratic Rep. John Martin from Eagle Lake, who sponsored the amendment.
“Currently, this bill is an insurance industry lawyer’s dream,” said Rep. Sharon Treat of Hallowell, who serves as the ranking member of the Insurance and Financial Services Committee.  “If consumers in rural Maine are penalized unless they use cheaper hospitals further from their home, patients will suffer, local hospitals will suffer, and local doctors will suffer.”

In response to questions during the debate about the tax used to fund the reinsurance pool, Rep. Treat confirmed that the tax would be charged to each policy holder and anyone on the insurance policy. “That question may have been rhetorical, but this literally amounts to a tax on babies.”

Republican lawmakers, who voted in support of the tax on every Maine insurance policy holder, voted to exempt lawmakers and state employees from the tax while requiring other self insured groups, such as teachers or those working at Wal-Mart, to pay the tax.

Democratic State Rep. Jeff McCabe of Skowhegan was critical of the exemption and said he wouldn’t want to ask his constituents to do something he wasn’t required to do.

Other Democratic amendments included placing three consumer advocates on the industry dominated board that oversees the funding of the reinsurance pool and has the authority to raise the tax if funding is insufficient; restoring the state health plan; and allowing Vermont to be included among the states where we can purchase insurance from.

Republicans voted on LD 1333 without independent fiscal analysis from the Bureau of Insurance. In response to a formal request for information and analysis from Democrats on the Insurance Committee, the Bureau provided analysis from 2007 on a similar but less drastic plan, showing this bill will cause health insurance rates in rural Maine to go up on average by 20 percent. Maine people living in the North will experience an average rate increase of 19 percent. Maine people living in Down East will experience an average rate increase of 22 percent.

The bill first passed in the House last Thursday along party lines and was amended after adjustments were made by Democratic Senators on Wednesday. The bill faces additional votes in the Senate before it can become law.

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