Dirigo report presented to Baldacci

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AUGUSTA (AP) – Health insurance mandates and added taxes on cigarettes, alcohol and snacks are among the recommendations in a report on improving Maine’s Dirigo Health program that was presented Monday to Gov. John Baldacci.

The governor said the report by the Blue Ribbon Commission on Dirigo Health Reform endorsing those and numerous other changes was already being analyzed by his staff and he intends to submit legislation outlining his administration’s reworked proposals in about a month.

The blue ribbon panel included representatives of business, insurers, consumers, labor and the Dirigo Health board. It was united in its support for expanding Dirigo to cover more of Maine’s uninsured and underinsured people, said its chairwoman, Sandra Featherman.

The highest priority should be uninsured and underinsured people under 300 percent of the federal poverty level, it said.

A majority of the commission’s members endorsed increased taxes that could include tobacco products, including 50 cents on a pack of cigarettes, a snack tax, a tax on soft drinks, beer and wine.

The report also endorses the idea of employer and individual mandates to provide or obtain health insurance, as a few other states have done or are considering. Individuals earning at least four times the federal poverty level would be required to get insurance.

Asked for his reaction to the insurance mandates, Baldacci said, “I’m very intrigued by that idea,” but said it and other ideas remained under study.

The report also suggests a self-insurance option for DirigoChoice, the program now covering 13,000 individuals and 2,300 businesses. A self-insurance program is already in place for state employees.

Another option is to have the state take on some of the risk for insuring more Mainers. That would make Maine more attractive to other insurers, increasing competition that drives down costs.

Other options that could be considered include establishing a high-risk pool and merger of individual and small group markets in the state.

The commission addressed the highly contentious issue of savings offset payments, the money Dirigo receives as a result of the reduced bad debt and charity care needed because more people are insured.

Its report suggests that providers, consumers, employers and insurers meet “as soon as possible” to modify the formula through which bad debt and charity care savings are captured and redirected.

The state insurance superintendent’s finding in 2005 that Dirigo initiatives produced savings of nearly $44 million in its first year sparked litigation by insurers and business groups. Baldacci said Monday he would like to see changes in place before the second year savings are calculated.

Baldacci acknowledged that Dirigo has had its growing pains, describing it as “a work in progress” and expressing hope that the commission report “will take us in a new and important direction.”

AP-ES-01-29-07 1648EST

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