AUGUSTA — In a 76-72 vote that broke along party lines, Republicans in the Maine House of Representatives gave initial approval to a fast-tracked bill containing sweeping changes to the state’s insurance regulations, adding a provision that will allow out-of-state insurance companies to sell lower-cost plans here.

Democrats were outraged. During a lengthy floor debate, House Democrats blasted the bill’s impact on northern, rural and elderly Mainers. Members of the minority party openly seethed at what they viewed as the GOP’s exertion of majority power without consideration for compromise, and an unwillingness to submit the bill to a complete independent review.

“There are times when the majority uses their power,” said House Minority Leader Emily Cain, D-Orono. “But never in my time here have I seen it used in such a way that’s so rushed, that’s so unwilling to answer the tough questions about policy.”

However, House Speaker Robert Nutting, R-Oakland, hailed the decision as a victory for all Mainers.

“For years, reasonable proposals to fix a dysfunctional health insurance system have faltered in the Legislature,” Nutting said in a press release. “Today, we have taken a giant step toward making health insurance more affordable for Maine residents and employers.”

Under the GOP plan, the interstate insurance sales would begin in 2014. That’s the same year that the interstate exchanges are set to begin in the federal health care law.

In a press release, the Republican majority office said the plan would sync with the Affordable Care Act “in the event the law survives court challenges.” If the law is struck down, the release said, “the plan provides a structure that lowers costs, expands choices and moves Maine into the American mainstream.”

The bill also allows companies with fewer than 50 employees to merge and create larger insurance pools, thereby distributing risk. For companies with 20 or fewer employees, the plan establishes a tax credit for maintaining wellness programs. The credit would range from $100 per employee to a maximum of $2,000.

The GOP says the bill’s so-called Guaranteed Access Plan would make sure chronically ill and high-risk individuals have the same insurance as everyone else.

The bill provides state subsidies for the Guaranteed Access Plan through a monthly assessment of $4 on all privately insured Mainers.

Democrats, however, doubt that the $4 charge can fund the high-risk pool.

“This is either a hidden liability to the state or they’ll only have enough money to cover a few people,” said Trish Riley, the former head of the Office of Health Policy and Finance.

Riley indicated that a lack of funding could put a healthy person who suddenly develops cancer or another disease on a waiting list.

Democrats had other concerns, including significant rate increases for Mainers in northern or rural regions. Those increases were based on a preliminary analysis by the Bureau of Insurance.

Whoopie pies vs. insurance

Only two Republicans spoke during the floor debate as Democrats took turns bashing the bill and the expedited process. 

Rep. Mike Bryant, D-Windham, said the House “spent more time on whoopie pies than this bill.”

Rep. Sharon Treat, D-Hallowell, likened the process to buying a used car: “LD 1333 was rushed off the lot so fast the bondo patching hadn’t even dried.”

Rep. John Martin, D-Eagle Lake, said he understood that Republicans were “committed to voting blindly for a bill that no one has read.” He acknowledged that insurance reform was a GOP campaign issue. But, he said, following through on a promise to support a flawed bill could haunt lawmakers in 2012.

“From a political point of view, I hope you vote for the bill,” Martin said. “Because I will be happy to go to your communities … and have regional meetings to discuss your vote.”

Republicans last week began a concerted push to advance LD 1333, transforming a four-page bill modifying community rating into a 45-page overhaul of insurance regulations in seven days.

The bill’s final language was completed Wednesday, about 18 hours before the House vote. It will head to the Senate for a vote Tuesday.

Republicans said provisions in the bill were nothing new.

Rep. Jonathan McKane, R-Newcastle, responded to Democrats’ criticism by saying he wished Dirigo Health, the Democrat-backed state health plan, had received the same calls for scrutiny.

McKane said Republicans had made previous attempts to reform state insurance laws. “We all knew these reforms were coming.”

Although Democrats’ criticism of the vote reverberated throughout the State House on Thursday, conspicuous silence came from other quarters.

Gov. Paul LePage has promised to make the health insurance overhaul the next phase in his so-called regulatory reform package. But it appears the governor is ceding that initiative to the Legislature.

“Why reinvent the wheel if something is going to work?” said Adrienne Bennett, a spokeswoman for LePage. “The Republicans have put this plan together and we support it.”

The state’s largest business advocate is also staying out of the fray. The Maine State Chamber of Commerce last month opposed a slate of interstate insurance bills, saying the proposal could create “winners and losers” in the business community. Elements of those bills, in particular interstate insurance, have been consolidated into LD 1333.

Peter Gore, a lobbyist for the chamber, said Thursday that the organization is “neither for or against” the advancing bill. Gore said some of the provisions could benefit some members, but the chamber will be closely monitoring others.

Gore declined to elaborate.

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