Insurance companies get a voice in Augusta

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We know Sen. Lois Snowe-Mello, R-Poland, wants to give a greater voice to the chemical companies in Augusta, as she told the Sun Journal only a few months ago. But now, it seems, she wants to boost the voice of the insurance industry, too.

Last week, Snowe-Mello and her Republican colleagues in the Maine Legislature fed the insatiable appetite of the insurance industry by championing a plan to boost the profits of the insurance industry, all at the expense of the Maine taxpayer.

While lots of questions may remain unanswered about the Republican-led proposal, one thing we know for certain is that LD 1333 will surely drive up health care costs for people living and working in rural areas and for Mainers over age 48.

Republican lawmakers voted to give profit-bloated insurance executives carte blanche over a taxpayer-funded reinsurance pool.

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Republican lawmakers also created a new tax on every Maine policyholder. Republicans authorized a tax of $72 per person per year in order to fund the reinsurance pool, which is estimated to cost between $25 million and $40 million.

What’s worse, if the reinsurance pool runs dry, Maine will have to do what other states have done: limit benefits to the sickest people or raise the insurance tax on Mainers in order to continue funding the pool. And, who decides what happens to Maine people or how much we’re taxed? You guessed it — the insurance companies.

Is that fair?

My Democratic colleagues and I asked that very question during the debate about LD 1333. We were told that it was not the “intent” of the insurance companies to increase the tax or limit coverage to the sick and the elderly.

Since it wasn’t the “intent” of the insurance companies, Democrats suggested correcting the bill to clearly reflect the stated intent and thereby protecting Maine people. Instead, Republican lawmakers denied that request, insisting we trust the “intent” of the insurance companies.

It’s sort of like the fox watching the henhouse.

The overhaul also allows insurance companies to discriminate based on age. That means some Mainers may be charged three times more for their health insurance than their neighbor, just because of their age — and they might see an additional increase if they live outside an urban area. Also troubling to me, as a welder, is that the insurance companies can decide that the kind of job you have warrants an additional charge on your insurance premium.

The pattern is clear. Insurance companies are in charge and consumers have lost any protection.

So who are the biggest losers with this health care “reform?” Mainers who are past the age of 48, sick, or suffer from chronic illnesses such asthma, or live outside an urban center such as Portland or Bangor.

Health insurance rates in rural Maine will go up on average by 20 percent. More specifically, Maine people living in the north will experience an average rate increase of 19 percent while those living Down East will experience an average rate increase of 22 percent.

Although this legislation was passed without analysis from the Bureau of Insurance, a prior analysis was done on a similar but less drastic plan in 2007. The findings then showed that those who wanted to keep their current insurance would see a rate increase of 170 percent.

Democrats were not alone in opposing LD 1333. Doctors, hospitals, business groups and patients also expressed concern about the plan. The major daily newspapers in the state even cautioned against the rush. Not even the Maine State Chamber would endorse the Republican plan. That’s because the bill was rushed through the Legislature with no fiscal or actuarial analysis.

Furthermore, the legislation exempts lawmakers and state employees from the insurance tax.

Over the next few weeks, Republican lawmakers will try to tell the public that the new law will lower rates and help Maine businesses. They may even tell people it will help create jobs. People should then ask, if it’s such a good deal, why did they exempt themselves and state employees from the insurance tax? (I was told they would “fix it later.”)

I urge Republican lawmakers to furnish the proof that the insurance plan will work in Maine. But what I expect is rhetoric, anecdotes, and perhaps a microphone giving a booming voice to the insurance industry in Augusta.

I hope I’m wrong.

Sen. John Patrick, D-Rumford, serves on Inland Fisheries & Wildlife and Veterans & Legal Affairs committees, and represents District 14.

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