By State Sens. Rodney Whittemore
and Lois Snowe-Mello
Maine has some of the most expensive health insurance rates in the country, despite having health care costs that are in line with other states.
For decades, the practical effect of Maine’s legislative approach to health insurance policy has been to make private insurance unavailable and unaffordable.
Currently, 133,000 people in Maine are without health insurance. Maine Republicans pledged last November to bring common-sense solutions to Augusta. That includes market-based health insurance solutions that ensure that everyone has access to health insurance that is more affordable.
Insurance is designed to protect all of us from catastrophic risk by spreading it over a broad population. It is only affordable if the pool of premium payers includes younger, healthier adults to offset those with high health care costs.
Right now, the monthly premium for a 20-year-old male or female is $718. In this—or any economy—how many 20-year-olds do you know who can afford to purchase health insurance at this rate?
If that same 20-year-old were allowed to purchase health insurance in New Hampshire, the monthly premium would be $190. Anthem has only 163 individual policyholders ages 18 to 24 in Maine. In New Hampshire, that company has 1,727.
In the past, we have offered numerous proposals to allow Mainers to purchase health insurance from across state lines. All have been routinely defeated, even though individuals and businesses have cried out for relief in the face of rising energy, living and now food costs.
Many of us campaigned last fall to bring real change to how the state conducts its business, including its approach to health insurance policy.
The change in leadership last fall gave us the opportunity to adopt fresh, market-based solutions that will lower premiums; protect Maine’s most vulnerable citizens; and guarantee access to all, regardless of health conditions.
The Affordable Care Act (ObamaCare) has created a huge amount of uncertainty in the health insurance market. Rather than wait until that debate is resolved, we are pushing forward, working with others, to create certainty and make health insurance more affordable for everyone.
We compared Maine to other states, and we have found a solution that will ultimately lower health insurance costs for everyone, while guaranteeing access for our most vulnerable individuals. We propose to create the Maine Guaranteed Access Plan, an Idaho-style reinsurance system.
We chose Idaho because it is about the same size as Maine; has more low-income families; fewer firms offering health insurance; and more people covered by private insurance. Idaho’s individual reinsurance pool has been operational since 2001 and has an $18 million reserve fund with revenue in excess of expenses incurred.
The Maine Guaranteed Access Plan is within the framework of ObamaCare if that law survives, or it will provide a sound structure to lower health insurance costs if ObamaCare is struck down.
Consider these monthly individual premium comparisons:
Age 20: Maine, $718; New Hampshire, $190; Idaho, $104
Age 30: Maine, $740; New Hampshire, $200; Idaho, $162
Age 40: Maine, $897; New Hampshire, $302; Idaho, $222
Age 50: Maine, $964; New Hampshire, $472; Idaho, $278
Age 60: Maine, $1,076; New Hampshire, $723; Idaho $401
(source: ehealth.com and Anthem.com)
We find it unacceptable that a 20-year-old in Maine would have to pay $718 a month for health insurance, when that same policy would cost a 60-year-old in Idaho $401. Rather than impose a government-run “one size fits none” health care system, we are pursuing common-sense, market-based approaches that will lower rates for everyone; offer consumer choice; and guarantee access for all.
We are pushing forward, working constructively with interested parties to create certainty in the health insurance market. We hope that when LD 1333 is considered by the full Legislature, we will have bipartisan support for moving Maine forward.
By reducing costs and expanding access to health insurance, we will also create a better environment for job creation.
Sen. Rodney Whittemore, R-Skowhegan, is the chairman of the Insurance and Financial Services Committee. Sen. Lois Snowe-Mello, R-Poland, is a member of the Insurance and Financial Services Committee.