Mills calls Dirigo failure
Sen. Peter Mills is calling on the state to close down new enrollment in the subsidized DirigoChoice insurance plan as part of his campaign for governor, hoping to discredit a program Gov. John Baldacci cites as one of his crowning achievements.
“John Baldacci ran for governor by creating an illusion that he could provide coverage for Maine’s uninsured without raising taxes,” Mills said at a press conference Monday in Augusta. “If Dirigo was John Baldacci’s answer for the uninsured, then it has surely failed.”
Mills cited recently released statistics from the Dirigo Health office that show only about one-quarter of the 7,300 currently enrolled in DirigoChoice were previously uninsured. He also said people were misled about how the insurance was going to be paid for after the initial seed money of $53 million in one-time Medicaid funds are spent.
“The administration is about to impose a $31 million tax on the health costs of 700,000 Maine citizens in order to cover a few people with the most expensive health insurance product in the state,” Mills said.
The legislation that created DirigoChoice, which Mills supported, allowed for that fee or what’s called a “savings offset payment” that is supposed to recoup money saved in the healthcare system because of Dirigo initiatives, including voluntary caps on hospital spending and profits. The Dirigo Health agency is looking to collect $31 million of those savings through a fee on private insurance companies and self-insured businesses to keep the program going next year. There is nothing to prevent that fee from being passed onto consumers through higher premiums.
Mills called on the administration to close enrollment for Dirigo or, “at the very list…limit enrollment to those that have been without insurance for at least six months.”
Lee Umphrey, the governor’s spokesperson, said, “There will be no moratorium on Dirigo enrollment. Dirigo will become stronger, not weaker.”
Lindell proposes “revival”
State Rep. Kenneth Lindell, R-Frankfort, has proposed a plan he says could save DirigoChoice by turning it into a combined catastrophic insurance policy and a health savings account.
Lindell’s plan keeps the subsidies now offered on the premium for low-income enrollees, but directs most of those subsidies into HSAs. Through the HSAs, individuals would receive up to $1,500 per year to spend on basic preventative and routine care and families would receive up to $5,250 per year. The catastrophic plan would cover all medical expenses once the deductible of $5,000 per individual or $10,000 per family is met.
If the HSA balance is not spent, it could be rolled over and added to the following year’s contribution.
“I think this could actually save DirigoChoice,” said Lindell.
Republicans in the Legislature have been calling on their Democratic colleagues to promote health savings accounts, in general, by conforming to the federal tax code and making them tax exempt in Maine.
When asked about Lindell’s plan, the administration said it is open to new ideas.
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