NCPA - National Center for Policy Analysis


November 12, 2009

Maine's legislators have tried for decades to fix its health care system, but their efforts have always fallen short: health insurance premiums are still among the least affordable in the nation, health care spending per person is among the highest and hospital emergency rooms are among the most crowded.  Indeed, many overhauls to the system have done little more than squeeze a balloon -- solving one problem while worsening another, says the New York Times.

To conservatives, Maine proves that government efforts to strictly regulate the nation's health insurance market are doomed.  Many of the reform proposals circulating on Capitol Hill have already been tried in Maine:

  • A state-sponsored insurance plan has been capped at fewer than 9,000 because of financing problems, and the most common choice of those buying new plans in the state requires them to spend at least $15,000 a year before the insurer pays anything -- leading many to avoid important medical visits.
  • Maine is one of 17 states that limits how much insurers can charge people for being older, and it does not allow exclusions for previous illnesses -- both policies that are part of national reform proposals.
  • One result is that premiums for younger people are relatively high; although national proposals would require that nearly everyone get coverage or pay a penalty, Maine's Legislature rejected such a mandate so many young people do not or cannot buy insurance -- further skewing the insured pool to sicker and older people and making premiums that much higher.

Another change Maine has tried is to expand its eligibility rules for Medicaid, the government program for the poor.  Nearly a quarter of the state's population participates in the poverty program.  Proposals on Capitol Hill would require similar expansions across the country.

But Maine's poor are among the sickest in the nation, and its Medicaid benefits are relatively generous.  Only Alaska spends more per adult Medicaid beneficiary.  Part of the reason may be that, because premiums in the private insurance market are so high, many go without insurance for years before qualifying for Medicaid, says the Times.

Source: Gardiner Harris, "Maine Finds a Health Care Fix Elusive," New York Times, November 11, 2009.

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