Recently the Blue Ribbon Panel on Dirigo Health gave its report. Dirigo is a discount health insurance plan designed to reduce the number of uninsured in Maine. Funding for the discount was to come from an assessment (some say a tax) on private health insurers in Maine, the idea being if Dirigo reduced the number of uninsured, private companies would enjoy a reduced cost shift by providers.
It’s called a savings offset payment (SOP), a tortuous financing scheme which didn’t work. The number of uninsured hasn’t come down. Health insurers resisted the offset payments. The number of individuals and small businesses forecast to sign up is below expectations, and the ability of providers to shift costs was overrated. Now comes the Blue Ribbon Panel to find a better way.
The recommendation is to fund the discount through a junk food tax of $57 million. Wow! The solution is more taxes from Maine people. If Dirigo is a discount program, it stands to reason more individuals and small businesses will sign up, and as the program enlarges, more tax money will be needed to fund the discount.
Maine has higher insurance rates than other New England states, and that’s part of the reason we have so many uninsured. Another reason is there are many mandated benefits from the state. Raising taxes to cover Dirigo’s shortfall is not the answer.
Let’s have a Blue Ribbon Commission dedicated to lowering health insurance costs and solving the real causes of high health care costs in Maine.
Frederick Holler, Auburn