GOP dodges fallout from late-night quarrel over insurance bill

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AUGUSTA — Hours after abandoning a late-night push to enact a controversial health insurance bill, Republican lawmakers Friday weathered criticism that their decision to exert majority power could impede passage of the state budget.

Democrats have blasted the GOP for fast-tracking the proposal to overhaul the state’s insurance laws, calling the majority party’s quest for a policy victory reckless.

On Thursday the rhetoric engulfed the typically bipartisan Appropriations Committee after the panel was asked by Republican leaders to exempt the bill’s fiscal impact.

The decision infuriated Democrats, but it also upset Rep. Patrick Flood, R-Winthrop, co-chairman of the Appropriations panel. Flood attempted to resign as the committee chairman following the panel’s divided vote to exempt the insurance bill’s fiscal impact.

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Republicans and Democrats on Friday agreed that the bill’s fiscal note is minimal, about $75,000 in fiscal year 2014 and $302,686 in fiscal year 2015.

But Democrats said the GOP’s haste to adopt insurance changes that will begin taking effect in 2012 was unnecessary and endangered the committee’s tradition of bipartisan work.

House Minority Leader Emily Cain, D-Orono, described the GOP’s decision to force Appropriations into the partisan fray as “unnecessary roughness.”

“The Appropriations Committee was forced to go in on a non-budget issue, on a non-emergency bill to take their very first divided vote of the entire session,” she said. “I think that’s a setback not only to the good work but the goodwill of the committee this session.”

The committee was called into session around 11 p.m. Thursday, about three hours after the House passed an amended version of LD 1333.

Typically, legislation with a financial impact is sent to Appropriations before final enactment. But Republican leaders decided they wanted LD 1333 exempted so it could proceed with enactment in the Senate that night.

“I think it’s important for our Republican colleagues to understand that what we lose in rushing this vote tonight is a level of trust,” Rep. Peggy Rotundo, D-Lewiston, said. “It’s important to understand how deeply disrespected we all feel.”

Rep. David Webster, D-Freeport, told the panel that he and Rotundo were leaving the State House when they were called back in to vote on the exemption. Webster called the decision “shameful.”

Republicans attempted to downplay the fallout on Friday, an effort made difficult by Flood’s attempt to resign as chairman of the panel.

Lance Dutson, the communications director for House Speaker Robert Nutting, R-Oakland, said Flood attempted to step down because he was upset that partisan politics had infected the committee.

Dutson said Nutting has declined to accept Flood’s resignation, adding that the speaker hoped Flood would reconsider over the weekend.

Flood did not return a call seeking comment.

Although the committee passed the exemption on party lines, the Senate ultimately put off final enactment after reconvening at 12:45 a.m.

Sen. Jon Courtney, R-Springvale, said Senate Republicans decided to postpone the vote until Monday because they wanted to pass the bill “in the light of day.”

“We used to complain about things being done in the middle of the night and the darkness when we were in the minority,” Courtney said. “We thought it was a legitimate concern.”

Republicans countered Democrats’ criticism of the bill, saying the proposal would bring long-awaited reductions in insurance premiums.

Democrats said the plan contained a hidden tax on Mainers. 

The proposal creates a “Guaranteed Reinsurance Plan” for high-risk and older Mainers, a plan that is often referred to as a “high-risk pool.” Proponents argue that the pool will allow high-risk individuals to buy the same plans as other Mainers and at similar rates.

The GRAP is funded through a $4-per-month fee on every Maine policyholder.

Democrats say the fee is essentially a hidden tax used to generate about $36 million a year to fund the high-risk pool.

But proponents of the plan say the GRAP ensures high-risk Mainers will receive insurance at prices similar to healthy individuals. They also say the plan removes the incentive for insurance companies to push individuals into the reinsurance pool because providers have to put significant premium dollars received from high-risk individuals into the pool.

The reinsurance concept is already in place in Dirigo, the state’s health plan. However, Dirigo captures a fee only when policyholders use their coverage.

LD 1333’s GRAP assesses the fee every month, on every policyholder.

Democrats say the plan could be harmful to older, sicker Mainers and to those living in rural and northern areas.

They’re basing that outcome on an analysis conducted by the Bureau of Insurance in 2007.

Republicans have rejected calls for an updated analysis from the BOI, saying the study could take up to a year. They also argue that the insurance model, adopted by Idaho 10 years ago, has been proven. 

But the assurances have been slow to win over traditional supporters of health insurance reform. The Maine State Chamber of Commerce has yet to support the bill and said it would be closely monitoring potentially harmful provisions.

David Clough of the National Federation of Independent Business said Friday that his membership is also unsure. Clough said his members wanted to see a detailed analysis.

NFIB mostly represents businesses with fewer than 50 employees. The group has supported interstate insurance sales, a key component of LD 1333.

The group also supports repeal of the individual mandate in the federal health care law.

Despite the partisan rancor, a handful of Democrats support the plan. Others say the expedited process has made it difficult to back reforms they might otherwise agree to.

Sen. Margaret Craven, D-Lewiston, told the Sun Journal on Thursday night, “They are right; the damn system is broken, but to fix it the wrong way is wrong.”

smistler@sunjournal.com

LD 1333: Key provisions of Maine’s health insurance overhaul bill

By Meg Haskell, Bangor Daily News staff

— A change in rate structure that gives health insurance companies more freedom to charge higher rates to Mainers who are older, sicker and live in rural areas.

— The creation of a “high-risk pool” to cover Mainers who use a lot of health care services.

— The repeal of “Rule 850,” a 1991 regulation that protects Mainers from having to travel more than 30 minutes from their home for primary care and more than 60 minutes for hospital services.

— The marketing of out-of-state insurance plans in Maine, as well as the banding together of certain businesses to form insurance-buying groups.

— The repeal of the State Health Plan, a biannual assessment of health care facilities and services available in Maine, aimed at ensuring cost-effective investment and development.

— Several provisions that conflict with the rollout of the Affordable Care Act national health reform in Maine, including one that limits the coverage of children 26 and under on their parents’ health insurance to those dependents who reside in Maine.

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