Maine is losing almost a million dollars per day in federal revenue while thousands of people are needlessly going without health care coverage because of a stalemate in Augusta.
Now two Republican state senators are promoting what could be a political way out of this mess.
Lawmakers from both parties should seize this opportunity to extend health care to more than 60,000 residents and provide a boost to the state economy while reshaping through managed care a MaineCare system that is financially broken.
Sen. Roger Katz, the assistant minority leader from Augusta, and Sen. Tom Saviello, of Wilton, submitted the proposal as an amendment to Katz’s held-over managed care bill, which now supersedes a MaineCare expansion bill sponsored by the House speaker, Democrat Mark Eves.
The Democrats have made MaineCare expansion their main legislative goal, while they have rejected managed care in the past. By combining expansion with managed care, Katz and Saviello hope to bring enough Republicans and Democrats together to override a veto by Gov. Paul LePage, who has been critical of both policies.
The bill, which was the subject of a work session on Wednesday in the Health and Human Services Committee, would extend MaineCare to an estimated 60,000-70,000 childless Mainers who earn up to 138 percent of the federal poverty limit, or just more than $15,000 a year for an individual.
Under the Affordable Care Act, the federal government would pay 100 percent of the cost of the expansion through 2016 before gradually reducing that to 90 percent in 2020. The bill, however, ends the expansion automatically after three years, or if the federal government comes up short on its promised funding.
There is no way this could be a bad deal for Maine. The health and economic benefits of expansion are clear and significant as long as the federal government keeps its promise. And if it doesn’t, the measure ensures that Mainers won’t be left holding the bill.
The bill also would establish a managed care system, under which three or four companies would compete to enroll the entire MaineCare population, more than 300,000 residents. Instead of paying for each doctor visit or procedure, MaineCare would pay the companies a set amount for each patient each month. It then would be up to the companies to manage each patient’s health so that the cost to the company does not exceed what the state has provided.
To the state’s benefit, managed care provides budget certainty for a system that regularly features million-dollar shortfalls.
Proponents of managed care say companies are given incentive to keep consumers healthier through primary care, to avoid expensive hospitalization. Critics, however, say it forces the companies to seek profits by limiting access to care.
The truth is, the level of care offered through managed systems varies widely, depending on how they are administered.
Cost savings through managed care is also no sure thing. There is little research on the subject, and much of what is available is either out of date or inconclusive.
But that should change in the coming years, as states acquire more experience placing Medicaid recipients on managed care.
At the same time, Maine will learn about the changing face of health care. A nonpartisan study mandated by the bill would examine the impact of MaineCare expansion, providing a true picture of its costs and benefits, both in 2015 and 2016. Another would see if some of those people covered under the expansion can be transferred to private plans through the federal health insurance marketplace.
With that information, Maine then can create a system that produces healthier residents with a more reliable budget.
In the meantime, the more than 60,000 Mainers who gain health insurance, along with thousands more in the health care industry, will see the benefits of MaineCare expansion.