Remember the Maine!

posted at 5:45 pm on August 21, 2009 by Ed Morrissey

The Wall Street Journal looks at the public option in relation to one state’s experience with it — and the disatrous results it achieved.  Maine established its DirigoCare system in 2003, fueled initially by federal stimulus dollars, with its future funding planned from health-care cost savings with universal coverage and mandates for level premiums and elimination of pre-existing condition denial.  The result?  The disaster that anyone with a lick of economic sense could have predicted:

Over time, the plan was to be “paid for by savings in the health-care system.” This is precisely the promise of ObamaCare. Maine saved by squeezing payments to hospitals and physicians.

The program flew off track fast. At its peak in 2006, only about 15,000 people had enrolled in the DirigoChoice program. That number has dropped to below 10,000, according to the state’s own reporting. About two-thirds of those who enrolled already had insurance, which they dropped in favor of the public option and its subsidies. Instead of 128,000 uninsured in the program today, the actual number is just 3,400. Despite the giant expansions in Maine’s Medicaid program and the new, subsidized public choice option, the number of uninsured in the state today is only slightly lower that in 2004 when the program began.

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.

Who pays most for all of these mandates?  The insured:

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.

The plan was supposed to be funded without taxes, as planners envisioned bucketloads of savings from granting universal coverage.  Not only did the universal coverage fail to materialize — mostly because people simply chose not to participate — but Maine broke its promise after four years and proposed sin taxes to cover a large budget deficit.  When voters rejected it, the state imposed a tax on employer-provided health insurance.  Ironically, because Maine has to balance its budget, they have now restricted enrollment in DirigoCare, which has a waiting list for people to join.

Dirigo, by the way, is the Maine state motto, which means “I lead”.  Indeed it did, on the public option, where it has demonstrated what a disaster it would be for the nation to adopt.

Update: Jazz Shaw looks at HR2520, the Republican proposal for health-care reform, which has drawn no attention at all.  It won’t fly, he says, because it makes far too much sense.


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When can we start blowing stuff up?

get MB4 and the rest of the FA in here…….

Janos Hunyadi on August 21, 2009 at 5:48 PM

Update: Jazz Shaw looks at HR2520, the Republican proposal for health-care reform, which has drawn no attention at all. It won’t fly, he says, because it makes far too much sense.

And the PDF of the bill is searchable. Right there it lets you know it will never pass this congress. /sarc

WashJeff on August 21, 2009 at 5:49 PM

This is racist.

The sequel was TR’s Great White Fleet in 1907.

faraway on August 21, 2009 at 5:51 PM

Anybody think adding $2.0 trillion dollars to the national debt over the next 10 years, as the Obama Administration just admitted, will make even more Americans queasy about passing Obamacare?

Nice time to leave town for that vacation Barry.

DrW on August 21, 2009 at 5:52 PM

This wont be Obama’s waterloo, this will be his Stalingrad.

DJ Rick on August 21, 2009 at 5:53 PM

I wonder if the two RINO senators up there will look at this failed public health insurance program when voting on bammercare.

farright on August 21, 2009 at 5:54 PM

Well, duh.

Political Junkie on August 21, 2009 at 5:55 PM

The Democrats ability to ignore examples is stunning.

rob verdi on August 21, 2009 at 5:55 PM

I wonder if the two RINO senators up there will look at this failed public health insurance program when voting on bammercare.

farright on August 21, 2009 at 5:54 PM

But Maine’s budget is balanced, it is working. Rationing works. /sarc

WashJeff on August 21, 2009 at 5:55 PM

Between this and the utter failures of RomneyCare up in Massachusetts and TennCare in Tennessee, it should be enough to kill this stupid idea.

Unfortunately, these are the same people who think the problem with communism is that it’s never been implemented correctly.

teke184 on August 21, 2009 at 5:56 PM

I remember the Maine…..and Putz, Neise, and a whole bunch of others. What the hell happened to my team.

Opps, wrong message board….my bad

Jerome Horwitz on August 21, 2009 at 5:58 PM

Between this and the utter failures of RomneyCare up in Massachusetts and TennCare in Tennessee, it should be enough to kill this stupid idea.

teke184 on August 21, 2009 at 5:56 PM

And the 6 or so months with Hawaii’s experiment.

WashJeff on August 21, 2009 at 5:58 PM

Between this and the utter failures of RomneyCare up in Massachusetts and TennCare in Tennessee, it should be enough to kill this stupid idea.

Unfortunately, these are the same people who think the problem with communism is that it’s never been implemented correctly.

teke184 on August 21, 2009 at 5:56 PM

Or been implemented by them. The demogods feel they can make a silk purse from a sow’s ear.

ICBM on August 21, 2009 at 5:58 PM

Unfortunately, these are the same people who think the problem with communism is that it’s never been implemented correctly.

teke184 on August 21, 2009 at 5:56 PM

Exactly, and the fastest way to implement communism here is through health care. This bill needs to be stopped completely.

farright on August 21, 2009 at 6:00 PM

Democrats only use history that benefits them.

Will all of those who just read this post look right here.

portlandon on August 21, 2009 at 6:01 PM

More bad budget news, check out Drudge:

WASHINGTON (Reuters) – The Obama administration will raise its 10-year budget deficit projection to approximately $9 trillion from $7.108 trillion in a report next week, a senior administration official told Reuters on Friday.

obladioblada on August 21, 2009 at 6:04 PM

I’d rather have a doctor cut off my foot, for $30,000, as opposed to having my tongue ripped out, by the coming regime.

capejasmine on August 21, 2009 at 6:04 PM

obladioblada on August 21, 2009 at 6:04 PM

Friday afternoon bad news drop as he heads out of town for 10 days.

obladioblada on August 21, 2009 at 6:05 PM

Gird your wee-weed.

farright on August 21, 2009 at 6:05 PM

Republican bill looks reasonable from Jazz’s description. Did Republicans make any attempts to pass something like this when they were in control? Might have saved us some Hopenchange heartache.

Scranton on August 21, 2009 at 6:06 PM

Ah , the maine problem..

the_nile on August 21, 2009 at 6:06 PM

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.

$762 a MONTH for a health insurance premium? Breathtaking, when you consider how people shop for their mortgage payments, and negotiate directly for their car payments.

And this is a single guy. What happens if he has a little family to support?

RushBaby on August 21, 2009 at 6:07 PM

Yeah, but it appears that the Maine system had a few fatal flaws.

1. Maine didn’t tax people who didn’t enroll.
2. Private companies were not gradually priced out of business.
3. Maine didn’t print more money to cover the costs.

Obamacare can address those weaknesses.

malclave on August 21, 2009 at 6:07 PM

Republican bill looks reasonable from Jazz’s description. Did Republicans make any attempts to pass something like this when they were in control? Might have saved us some Hopenchange heartache.

Scranton on August 21, 2009 at 6:06 PM

Republican bills aren’t socialist enough for this bunch of crooks.

farright on August 21, 2009 at 6:08 PM

You guys just don’t understand. The public plans in Maine, Mass, Hawaii didn’t work because Barack, Barney, Henry and Nancy weren’t in charge. If they had been, it would have been a huge money saving success and the people in those states would be getting free unicorn taxi rides to their no-waiting doctor appointments.

Monica on August 21, 2009 at 6:12 PM

malclave on August 21, 2009 at 6:07 PM

You beat me to it.

hicsuget on August 21, 2009 at 6:15 PM

Will they look at the Republican proposal? Most certainly NOT. They have never intended to look at anything – despite the proclamations of bipartisan legislation – other than what Dear Leader proposes. And he’s making it up as he goes along. The real coup was suckering a couple of Republican Senators into supporting it!

GoldenEagle4444 on August 21, 2009 at 6:18 PM

FORGET results/failures, only look at intentions.

jukin on August 21, 2009 at 6:18 PM

Not to be a Democrat in Republican’s clothing or anything, but according to the rhetoric the plan is supposed to be “self-sustaining” – run as a business by the government. Maine’s program didn’t seem to have that objective in mind.

Conservative objections?

Black Yoshi on August 21, 2009 at 6:19 PM

Gee, the “Public Option” people never mention Maine. Or Oregon. Or Hawaii. Wonder why? Do you think they’re trying to HIDE something?

GarandFan on August 21, 2009 at 6:20 PM

supposed to be “self-sustaining” – run as a business by the government. Maine’s program didn’t seem to have that objective in mind.

Conservative objections?

Black Yoshi on August 21, 2009 at 6:19 PM

No objections, but one question….are you hitting a bong as you write. self-sustaining, you freakin’ crack me up.

jwp1964 on August 21, 2009 at 6:21 PM

jwp1964 on August 21, 2009 at 6:21 PM

Not my words.

Black Yoshi on August 21, 2009 at 6:22 PM

jwp1964 on August 21, 2009 at 6:21 PM

Not my words.

Black Yoshi on August 21, 2009 at 6:22 PM

Sorry. You were serious? It’ll be self sustaining alright, Can you say across the board tax rate hike?

jwp1964 on August 21, 2009 at 6:25 PM

Stalingrad stopped the advance.

The Tank Battle of Kursk turned it.

There needs to be a 1-2 punch here to follow Stalingrad with Kursk.

ajacksonian on August 21, 2009 at 6:30 PM

Excellent post, ajacksonian… We must continue the push (or the putsch?!)…

Khun Joe on August 21, 2009 at 6:37 PM

When the hell is basic economics going to be taught in High School?

All is lost to a nation of drooling imbeciles.

EZnSF on August 21, 2009 at 6:37 PM

But the more we spend on health care, the sooner the deficit will be gone. I don’t see how that is so hard to understand!

exhelodrvr on August 21, 2009 at 6:39 PM

Not to be a Democrat in Republican’s conservative clothing (DICC) or anything, but according to the rhetoric the plan is supposed to be “self-sustaining” – run as a business by the government. Maine’s program didn’t seem to have that objective in mind.

Conservative objections?

Black Yoshi on August 21, 2009 at 6:19 PM

FIFY

Read the entire article. It was supposed to pay for itself without additional taxes.

chemman on August 21, 2009 at 6:45 PM

Between this and the utter failures of RomneyCare up in Massachusetts and TennCare in Tennessee, it should be enough to kill this stupid idea.

teke184 on August 21, 2009 at 5:56 PM

And the 6 or so months with Hawaii’s experiment.

WashJeff on August 21, 2009 at 5:58 PM

You’d think, but as we all know, for lefties, ideology trumps common sense.

Bob's Kid on August 21, 2009 at 6:46 PM

EZnSF on August 21, 2009 at 6:37 PM

Most states require a 1 semester econ course in the Senior year of High School. My guess is that they are teaching something other than Econ 101.

chemman on August 21, 2009 at 6:47 PM

squeezing payments to hospitals and physicians

= not paying them.

taxachusettes socialist healthcare blew up in their faces too. How many bad examples must we cite?

NONE OF THE ATTEMPTS TO DO THIS SUCCEED. Socialism is a FAILED experiment. Put a stake in it!

dogsoldier on August 21, 2009 at 6:59 PM

I live in Maine. the legislature has been deluged by citizens demanding that Dirigo be scrapped, but they ignore those demands. This past year, Maine need whopping $58 MILLION dollars to keep Dirigo health afloat. It’s frikkin” insane to spend over 58 million for some 12,000 people’s health insurance.

The ONE thing that would put health care back into the black, at least for the citizens, would be for the feds to repeal the law which allowed states the exclusive right to say wh gets to sell insurance in each state.

If you could shop for health insurance in the same manner as you do car or homeowners, then prices would drop like a rock as companies got into some serious competition.

But, yeah. I’m stuck in Maine until June of next year, then it’s off to better climes. Texas, most likely.

AW1 Tim on August 21, 2009 at 7:06 PM

Barney Frank shows his elitist collors at a town hall. Turn to 8:00 to see Franks true feelings about the American people

sonnyspats1 on August 21, 2009 at 7:12 PM

This is the vicious cycle in which we are caught. As government continues to fail it is given more power. It uses it’s new power to fail in larger ways. The people, incensed by govt’s failure, give the govt more power (hope!) and the cycle continues.

At least he a good war president. (I’m putting that in every post just to drive the libs crazy,)

Meremortal on August 21, 2009 at 7:22 PM

Read the entire article. It was supposed to pay for itself without additional taxes.

chemman on August 21, 2009 at 6:45 PM

I understand that, but “savings in the health-care system,” as I see it now, is not the same thing as “self-sustaining.” Self-sustaining would mean that the public option would have to at least break even internally through premiums (just like a private business), whereas a program maintained by savings in the health-care system implies cash infusions/bailouts by the government in order to keep it going.

Black Yoshi on August 21, 2009 at 7:22 PM

I assumed “Dirigocare” was named after the Hindenberg.

Urquhart on August 21, 2009 at 7:23 PM

Now that I think about it, let’s suppose that the public option passes with accompanying legislation in HR 3200 making it “self-sustaining.” According to this article, then, we wouldn’t have anything to worry about, because it’ll go hopelessly bankrupt in a little while.

Of course, that the program will actually be required to support itself is a HUGE if.

Black Yoshi on August 21, 2009 at 7:24 PM

taxachusettes socialist healthcare blew up in their faces too. How many bad examples must we cite?

NONE OF THE ATTEMPTS TO DO THIS SUCCEED. Socialism is a FAILED experiment. Put a stake in it!

dogsoldier on August 21, 2009 at 6:59 PM

Liberals are insane, but I’m repeating myself. They think you can try the exact same thing again and again and one day you might get a different result.

Daggett on August 21, 2009 at 7:26 PM

Like Rush said, we don’t spend healthcare money on the healthy, we spend it on the sick. So, how do we do that and reduce costs?

SKYFOX on August 21, 2009 at 7:36 PM

Nice time to leave town for that vacation Barry.

[DrW on August 21, 2009 at 5:52 PM]

Elba Island, to plot his return?

Dusty on August 21, 2009 at 7:38 PM

I read the GOP plan. It really is a fairly simple straightforward kind of thing. That means the Democrats will hate it. No drama.

Terrye on August 21, 2009 at 7:44 PM

Why Government Can’t Run a Business

The Obama administration is bent on becoming a major player in — if not taking over entirely — America’s health-care, automobile and banking industries. Before that happens, it might be a good idea to look at the government’s track record in running economic enterprises. It is terrible.

In 1913, for instance, thinking it was being overcharged by the steel companies for armor plate for warships, the federal government decided to build its own plant. It estimated that a plant with a 10,000-ton annual capacity could produce armor plate for only 70% of what the steel companies charged.

When the plant was finally finished, however — three years after World War I had ended — it was millions over budget and able to produce armor plate only at twice what the steel companies charged. It produced one batch and then shut down, never to reopen.

Or take Medicare. Other than the source of its premiums, Medicare is no different, economically, than a regular health-insurance company. But unlike, say, UnitedHealthcare, it is a bureaucracy-beclotted nightmare, riven with waste and fraud. Last year the Government Accountability Office estimated that no less than one-third of all Medicare disbursements for durable medical equipment, such as wheelchairs and hospital beds, were improper or fraudulent. Medicare was so lax in its oversight that it was approving orthopedic shoes for amputees.

These examples are not aberrations; they are typical of how governments run enterprises. There are a number of reasons why this is inherently so. Among them are:

- more -

KentAllard on August 21, 2009 at 8:09 PM

We’ve all said this time after time, this bill has nothing to do with the so called crisis, but has everything to do with socialism.

Nuff said!

larvcom on August 21, 2009 at 9:54 PM

I understand that, but “savings in the health-care system,” as I see it now, is not the same thing as “self-sustaining.” Self-sustaining would mean that the public option would have to at least break even internally through premiums (just like a private business), whereas a program maintained by savings in the health-care system implies cash infusions/bailouts by the government in order to keep it going.

I also live in Maine. The ‘self-sustaining’ formula was based on some faulty assumptions. The state assumed providers would lower their costs when the pool of insured Mainers increased. As the article states, the rate of those uninsured in Maine has remained relatively flat. After all, why sign up for a plan that requires premiums if you can get the expanded MaineCare nearly free?

Slublog on August 21, 2009 at 9:57 PM

The only lesson that history teaches us is that we fail to learn the lessons of history.

The charming liar should have know…

Mojave Mark on August 22, 2009 at 12:11 AM

In Hillsborough County, Florida we have this: The Hillsborough County Health Care Plan.

“The award-winning program they created in 1991 actually expanded coverage from 15,000 to more than 25,000 residents but has still saved taxpayers $100 million over the last 10 years. In fact, the average monthly cost per enrollee served plummeted from about $600 to $250 (a month)over a period when most health care costs were rising.” this is just for the county, not the entire state.
visit their site: http://www.cjaonline.net/Communities/FL_Hillsborough.htm

Financed through a state authorized statute allowing a ½ cent sales tax approved by the County Commission, along with $26.8 million per year in property taxes as mandated by the State of Florida to fund indigent care. After just 4-1/2 years of operation (1993-1997), the Plan was so successful that the County decreased the sales tax to ¼ cent while saving property owners increases in property taxes.

I have employer health care coverage that I pay $364.00 a year, and the company pays $3,400.00. I have a deductible of $600.00. Insurance pays 80%, I pay 20% of the bills.

if my county can do this cheaper than my employer provided insurance, why don’t we do it for everyone?

but i would rather do this: put $4k into my private account, tax free, annually, to pay for my medical care, and combine it with a life insurance policy that would cover a catastrophic medical event instead of giving it to survivors in my death.

mydogwonthunt on August 22, 2009 at 12:24 AM

The sleepers have awakened. I am one of them, as are most of the posters here. I have been to most of the tea parties in my area—-I will be silent no more. Keep in mind that this revolt over government intrusions is a marathon and not a sprint. The proper question is not whether the white hot poker (Obamacare) or the red hot poker (Repub. alternative) hurts less when placed in our eyes, but what can we do to put the damn thing out.

My dad, a used car dealer, had a politician come to him asking for a sales job. Dad wanted to know why a college educated man wanted to take such a financial step down; the politician said “to improve my social standing”. We desperately need politicians with stated and signed ethics platforms, and the power to recall those that violate their platform. Just think, had Obama signed such a document, he could have been subject to recall within a week for violating a promise.

We EXPECT our elected officials to lie, steal, obfuscate, philander, and back stab us just as soon as the oath of office is sworn. A signed contract with each contender is a potential way to end this crud.

GnuBreed on August 22, 2009 at 1:13 AM

I remember the Maine that used to be conservative. That was before all the twits who had screwed up Connecticut, Massachusetts, and New York escaped into our state, and started screwing it up also.

Dr. Charles G. Waugh on August 22, 2009 at 1:34 AM

Exactly, and the fastest way to implement communism here is through health care. This bill needs to be stopped completely.

farright on August 21, 2009 at 6:00 PM

And that is exactly what the socialist and the Communist party USA have been saying for decades. They have said all along that the only way for them to succeed, was through nationlized health legistlation because once they have that in place, it leads to everything else.

Franklyn on August 22, 2009 at 3:05 AM

“I remember the Maine that used to be conservative. That was before all the twits who had screwed up Connecticut, Massachusetts, and New York escaped into our state, and started screwing it up also.”

Dr. Charles G. Waugh on August 22, 2009 at 1:34 AM

There’s a reason that Massachusetts and Connecticut have morphed so strongly into liberalism –Harvard and Yale. These are the incubators that have spread their poison to the lesser colleges, the teacher indoctrination centers and eventually, spilling over to Southern New Hampshire and Maine. It’s like a flesh eating disease.

Don L on August 22, 2009 at 6:24 AM

Update: Jazz Shaw looks at HR2520, the Republican proposal for health-care reform, which has drawn no attention at all. It won’t fly, he says, because it makes far too much sense.

A bit heavy on the increased government spending for my taste, but still the cat’s meow compared to Obamacare.

Count to 10 on August 22, 2009 at 10:09 AM

After all, why sign up for a plan that requires premiums if you can get the expanded MaineCare nearly free?

Slublog on August 21, 2009 at 9:57 PM

Not just that, but, instead of buying real insurance, a public plan that has to accept you and pay for your preexisting conditions means people can use it as insurance with out buying it in the first place. They just wait until they get sick, and then sign up for free money.

Count to 10 on August 22, 2009 at 10:14 AM