AUGUSTA – One way to make health coverage more affordable is to help the insurance market, Sen. Lois Snowe-Mello, R-Poland, said Wednesday.

Snowe-Mello was testifying for her bill, which would eliminate a mandate that health insurance companies in Maine sell standardized plans that have low deductibles and comprehensive coverage. If approved, she said, the change would draw more insurance companies to Maine and offer consumers more choices. Several Republicans are co-sponsoring the bill.

Experts testifying at the public hearing agreed that few of those polices are sold in Maine because they have grown so expensive. Exact numbers were not available Wednesday.

The Maine Bureau of Insurance and consumer advocates testified against the proposal, saying passage would mean the availability of comprehensive insurance for individuals would not be guaranteed, and could be replaced with more profitable policies with high, $5,000 deductibles.

While campaigning last fall, Snowe-Mello said one of her goals was to work for affordable and accessible insurance. That would be boosted if the state were to change one tiny word in law from “must” to “may,” she said. That could open up the market for more insurance companies to offer more individual health insurance plans in Maine, Snowe-Mello said, adding that competition is a good thing.

Now, if an insurance company decides not to offer the standard plan, “they can’t do business in Maine,” she said.

Poland insurance agent Carl Duchette said that during the 10 years he’s sold insurance, he’s seen six insurance carriers leave Maine. Removing the mandate would allow insurance companies to offer any product they wanted to. “Why would we stifle the competition?” he asked.

States without the mandate enjoy lower premiums, Duchette said. In Maine, an individual plan with a $5,000 deductible costs $537 a month for a 46-year-old adult and family. That same plan in other states without the mandate costs half that, Duchette said. “We have legislated the insurance companies out of the state.”

But Judith Shaw, Maine’s deputy superintendent of insurance, asked lawmakers to reject the bill.

By law, carriers must offer standardized plans with comprehensive coverage and with one of four deductibles, $250, $500, $1,000 and $1,500. That has two advantages, Shaw said. It guarantees that plans with those features will be available for individuals. And mandating standard plans allows consumers to compare rates between carriers on an apples-to-apples basis, Shaw said.

Joe Ditre of Consumers for Affordable Health Care added that if passed the bill would be a “direct assault” on DirigoChoice, health coverage that’s part of the larger Dirigo Health reform efforts.

The bill would “move the individual health insurance market in the opposite direction of DirigoChoice, which offers comprehensive coverage with low deductibles with premiums based on household income.

Instead of encouraging consumers to join one large insurance pool to spread costs, the bill would further fragment health care. Those who are young and healthy may choose to buy “stripped-down” coverage at rates that seem good but are not, given that the policies would cover little, Ditre said. Meanwhile older, sicker people would buy the comprehensive plans, further driving those premiums up.

Some may call that “the free market,” but Maine can’t have a free market when the market has failed, Ditre said.

Meanwhile when those with high deductibles become sick and lack coverage, they’ll either go without care or their health costs will be shifted to others, Ditre said.

The Insurance and Financial Services Committee will take up L.D. 86 in a 1 p.m. work session on March 17.


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