As Maine Goes, So Goes Obama?
posted at 8:23 pm on August 24, 2009 by Slublog
I know Ed wrote about this a couple of days ago, but I wanted to provide the perspective of a taxpayer in a ‘public option’ state.
As the president and congressional Democrats continue their quest to convince the American people that a public option will help lower healthcare costs, the Wall St. Journal looks north and finds an example of that approach…lacking.
Then the state created a “public option” known as DirigoChoice. (Dirigo is the state motto, meaning “I Lead.”) This plan would compete with private plans such as Blue Cross. To entice lower income Mainers to enroll, it offered taxpayer-subsidized premiums. The plan’s original funding source was $50 million of federal stimulus money the state got in 2003. 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.
It didn’t take long for the weaknesses of the program to make themselves evident. The ‘self-sustaining’ formulas were built upon faulty assumptions, and Maine taxpayers have been paying the price ever since. Even though the tax on insurers (euphemistically called a “savings offset payment’) was upheld by the state supreme court in 2007, the program still ran low on funds.
So to preserve Governor John Baldacci’s legacy, my insurance premiums are being taxed, and the legislature attempted to tax soda, wine and beer, which violated Baldacci’s campaign promise not to raise taxes. (Sound familiar?) Maine voters overwhelmingly rejected that tax, leaving the administration to look for other sources of revenue. One of the ideas under consideration? A $100,000 a year cap on benefits.
In addition, Maine’s bureaucrats are making it harder for hospitals to treat patients with their central planning view of the role of government.
According to the US Census bureau, Maine has a population of only 1.3 million. The Dirigo health plan insures only 9,472. This state is unable to run or find enough money to fund a program that insures only 0.7% of the state’s population. ObamaCare has many of the same provisions and funding formulas, and the president claims it will not only cover the health insurance needs of over 300 million Americans but also ‘bend the cost curve’ downward. Well, each time I get paid, money is taken out of my paycheck to fund my healthcare, Dirigo Care, Medicaid, and Medicare, so color me extremely skeptical of the administration’s claims.
Take it from an overtaxed Mainer, the idea of a public option is much better than the reality. In this case, as Maine goes should be what the rest of the nation avoids.