The result in Maine has been that relatively few uninsured have signed up for DirigoCare, Maine's state-run plan. But premiums have been increasing greatly in cost.
Why did this happen? Among the biggest reasons is a severe adverse selection problem: The sickest, most expensive patients crowded into DirigoChoice, unbalancing its insurance pool and raising costs. That made it unattractive for healthier and lower-risk enrollees. And as a result, few low-income Mainers have been able to afford the premiums, even at subsidized rates.And this is the sort of plan that the Democrats want to impose on the entire country. They want to nationalize Maine's problems. Do the Maine senators see what has happened in their own state and approve of the plans to spread Maine's woes to the rest of us?
This problem was exacerbated because since the early 1990s Maine has required insurers to adhere to community rating and guaranteed issue, which requires that insurers cover anyone who applies, regardless of their health condition and at a uniform premium. These rules—which are in the Obama plan—have relentlessly driven up insurance costs in Maine, especially for healthy people.
The Maine Heritage Policy Center, which has tracked the plan closely, points out that largely because of these insurance rules, a healthy male in Maine who is 30 and single pays a monthly premium of $762 in the individual market; next door in New Hampshire he pays $222 a month. The Granite State doesn't have community rating and guaranteed issue.
One proposal to get people into the DirigoChoice system is to reduce the premiums, presumably to give the uninsured a larger incentive to join. But that would explode the program's costs when it already can't pay its bills. A program that was supposed to save money by reducing health-care waste and inefficiencies has seen a 74% increase in premiums. But even those inflated payments can't keep the program out of the red.
Last year, DirigoCare was so desperate for cash that the legislature broke its original promise of no tax hikes and proposed an infusion of funds through a beer, wine and soda tax, similar to what has been floated to pay for the Obama plan. Maine voters rejected these taxes by two to one. Then this year the legislature passed a 2% tax on paid health insurance claims. Taxing paid insurance claims sounds a tad churlish, but the previous funding formula was so complicated that it was costing the state $1 million a year in lawsuits.
Unlike the federal government, Maine has a balanced budget requirement. So out of fiscal necessity, the state has now capped the enrollment in the program and allowed no new entrants. Now there is a waiting list. DirigoChoice has become yet another expensive, failed experiment in government-run health care, alongside similar fiascoes in Massachusetts and Tennessee.
8 comments:
Here in Tennessee, a couple of governors back, we had one that created a similar animal called "TennCare." It was and still is a major fiasco. I'm not impugning the character of the Democratic governor who created it. I think he meant well. It just wasn't thought through. Follow that by the worst governor Tennessee's ever had on record. He was Republican and I'm not impugning the party, either, because I have a tendency to vote that line most of the time. Now we have Governor Bredesen, a Democrat, in office. For the most part he's been a good governor. When he came on board TennCare was in a big, snarling knot. He asked the former Governor McWheter if he would come on board and help him straighten it out. McWherter refused and washed his hands of the matter. It's very frustrating for us Tennesseeans for the rest of the country not to study this model and realize it's a failed experiment.
Sokmnkee, did you forget about Ray Blanton in the 70s? He's my nominee for worst Tennessee governor ever.
Yesterday CNN was pushing an article on the success of Romney's reforms in Massachusetts, including positive comments from taxpayer associations. I'm not sure what to believe.
They don't use Obamacare that they want to impose on us, and we have to pay for their Rolls-Royce Care that they want to keep for themselves.
His Oneness, Dame Pelosi and Lord Reid are desperate to distinguish the ruling class from the ruled, the aristocrats from the peasants.
Sokmnkee,
When have failed experiments ever deterred ideologues. From all accounts cap-and-trade was a total failure in Europe, their carbon trading market crashed, and they have not decreased pollutions.
Seems someone use healthcare and cap-and-trade to grab power and make money on the side for the connected.
Didn't see the CNN piece, equitus, but I have friends and relatives living in MA. None has a good syllable to say about Romney's tenure as governor or about his plan. I'm suspicious of everything CNN airs, so would like to know more about the "taxpayers associations" that endorsed the plan. The only defense of his program I have heard Romney give, when he was asked, was it was less intrusive and less costly than what would have been mandated by Democrats. Hardly what I'd call a top rationale for doing it.
I don't trust CNN either, but I'm also too lazy to dig into the claims right now.
The CNN article on Mass is here.
Quote:
"There is this widespread assumption, that is treated as fact, that it's breaking the bank in Massachusetts ... it's not breaking the bank at all." said Michael Widmer of Massachusetts Taxpayers Foundation.
Costing more than expected, of course. But maybe things to learn from it.
As suspected, equitus, there is more to the Massachusetts Taxpayers Foundation (MTF) than its name implies. Before "Romney Care" was installed, MTF is on record as vociferously opposing it, saying it would break the state budget. Perhaps it is now for it, because many of its Board of Trustees are executives of insurance (Blue Cross) and finance (John Hancock, State Street, Fleet Boston) companies that benefit from the plan. It also appears MTF is no friend of the MA taxpayer, since in March 2009, Widmer came out in favor of raising the gasoline tax 25 cents per gallon.
I haven't been able to locate the Harvard poll that Blendon cited claiming "..Seven in 10 people in the state support the [Romney] program, and no more than one in 10 would repeal it." I'd like to see the questions before accepting that claim at face value.
Here's a link to a group opposing Widmer's MTF that also contains links to MTF's activities over the years.
Thank you very much, Bachbone.
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