Road Trip

Demographics, Geography Make for an Uphill Battle

Maine has a rich history of health care policy innovation, although it was the ACA that finally brought down the uninsured rate. An older, rural population means no guarantees.

Joseph Burns
Contributing Editor
% in the individual market: 5%
% uninsured: 5%
Per capita health expenditures (rank): $8,521 (5)
Rankings include the District of Columbia
Source for all data: Kaiser Family Foundation

Massachusetts gets credit—or blame, depending on your point of view—for developing the health insurance reform law that became the template for the ACA. But three years before, Maine had a law that many see as a forerunner of the Massachusetts scheme and as one of the first attempts in this country at making health insurance available to all.

With the ungainly name of Dirigo Health Reform (dirigo is Latin for I lead), the health insurance program sought to reduce cost shifting from hospitals, health systems, and physicians. And like the ACA, it also subsidized health insurance for individuals buying coverage from commercial insurers, called for expanding Medicaid, and included strategies to improve quality and cut costs. Other provisions regulated premiums in the small-group market, pushed for price transparency, standardized reporting for how health insurers set premiums and hospitals set prices. While the Dirigo Health Reform law helped to expand insurance coverage, the lack of an insurance mandate combined with guaranteed issue caused premiums to rise.

Maine was also a pioneer in developing the “invisible” high-risk pool, a version of which was a last-minute addition to the House version of the AHCA.

But these state-level efforts did little to lower the uninsured rate. In fact, the rate rose from 8.8% in 2007 to 11.2% in 2013, according to data from the Maine Center for Economic Policy (MCEP), a non­partisan research organization that focuses on low- and moderate-income Mainers.

After the ACA—including an ACA co-op, Community Health Options (one of only five remaining nationwide)—became effective in 2014, the uninsured rate went down to 8.4% in 2015, an all-time low for Maine, MCEP data show.

Maine is in an uphill battle when it comes to insurance coverage and health care costs because it’s both the most rural state in the country and the one with the highest median age, two factors that drive up health spending. “Maine has good quality of care and relatively conservative utilization, but we have high health care costs,” notes Elizabeth Mitchell, president and CEO of the Network for Regional Healthcare Improvement in Portland, Maine.

As in many states, some of the cost woes stem from health systems that are large enough to dominate the market and set high prices. In Maine they include Eastern Maine Health and MaineHealth. “The key driver is we have concentrated health systems with a lot of market leverage,” says Mitchell. “Also, we subsidize the care of those no one pays for, such as those who need behavioral health care or those who need access in small, rural areas.” For these and other reasons health insurance is expensive, she adds, “because we haven’t addressed the underlying drivers of health care costs.”

One lesson observers can take from Maine’s experience is that tinkering with any health reform program is necessary to make it sustainable, says Garrett Martin, MCEP’s executive director. “Unless everyone is willing to tweak it and improve it, then any problems you have will be magnified over time and become a series of Achilles’ heels that opponents can harp on to drag the thing down.”

Predicting what happens next in Maine is difficult, partly because the state, while politically bluish, marches to its own drummer. Trump and Clinton split its four electoral votes; the junior senator, Angus King, is an independent; and the governor, Paul LePage, is a Tea Party Republican who opposed the ACA. LePage has vetoed multiple Medicaid expansion bills but proponents managed to get an initiative on the ballot this November, which, if it passes, would expand the program.

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