Last fall as politicians campaigned across Maine – and the nation – one tune was consistently reverberating from their mouths: Access to affordable health insurance needs to become a priority in Augusta and Washington, D.C. Everyone agrees that we need significant reform to our healthcare system, but there are differing views on exactly what the solutions are and where they come from. Democrats and Republicans alike always seem to find something not to like about the other’s plan, while consumers and providers wrangle over the appropriate amount to pay and charge for the world’s best medical care.

Currently there are two bills working their way through the minutiae in Augusta that, if passed, stand to help address the regulations that excessively raise the costs of health insurance. These proposals, while not the silver bullet some may look for in healthcare reform, will do three critical things: reduce the cost of private health insurance; reduce the number of uninsured by encouraging more young individuals to purchase coverage; and, encourage competition in the Maine health insurance market.

LD 161, an act to allow certain discounts on health insurance, allows the cost of health insurance coverage to vary depending on – get this – personal behavior. Current Maine law only allows premium variations of +/-20 percent based on age. For example, a young person in his twenties consuming barely a fraction of the healthcare of someone in his or her sixties, pays only a third less for coverage. Although this law, when passed in 1993, was intended to make health insurance more affordable for older Mainers, it had the opposite effect. By exorbitantly increasing the cost for younger people, and driving them out of the market, it shifted the cost to those who need the coverage the most, Maine’s older population.

In addition, LD 161 allows health insurance carriers to offer additional discounts up to 20 percent based on an individual’s weight or adherence to a recommended schedule for regular physicals for individual and small group health insurance policies. To make health insurance affordable for everyone, we must maximize the number of healthy individuals who purchase coverage. This bill does that. The talk revolving around the cost of health insurance has long missed the boat on personal responsibility and the benefits of adhering to a healthy lifestyle. This bill gives people the ultimate incentive to make healthy choices – a healthier lifestyle, not to mention the added benefit of security that comes with health insurance.

Meanwhile, another bill being considered that would work in conjunction with LD 161 is LD 1190, an act to create the Comprehensive Health Insurance Risk Pool Association. The bill removes the guaranteed issuance requirement for individual health plans. Guaranteed issuance was a mandate also passed in 1993 that required insurers to cover any individual regardless of physical condition. Originally, this well-intentioned law was meant to protect

sicker consumers by guaranteeing access to health insurance. Instead, it encouraged people to wait until they became sick to purchase insurance, again driving healthier individuals out of the insurance market and increasing the premiums

for everyone else.

LD 1190 creates the Comprehensive Health Insurance Risk Pool Association. The purpose of the association is to spread the cost of high-risk individuals among all health insurers. The bill funds the high-risk pool through an assessment on insurers. The bill requires the state to submit an application to the federal government for federal assistance to create a high-risk pool. A risk pool allows high risk, or sicker, individuals to purchase affordable health insurance from a pool subsidized by an assessment on all insured individuals.

This bill addresses a critical need in Maine: drawing more people into the individual health insurance market. Ten years ago there were approximately 90,000 Mainers in the individual insurance market. Today, there are barely a third that number. Young, healthy individuals are opting to forgo health insurance coverage because of escalating costs. The problem is compounded because those remaining in that pool (older, sicker individuals) bear the brunt of the rising costs. In many cases, these are the same people whose health dictates that they have coverage.

The result of these two bills getting passed cannot be understated. Consumer driven health insurance, complete with individual choices, coupled with a reduction in regulation in the insurance market will eventually bring insurance companies back to Maine. Currently, only three companies provide health care coverage in Maine, due in part to guaranteed issue and excessive regulation. Reintroducing competition to the insurance market will help bring down costs, which in turn will allow for more healthy individuals to sign up for a reasonable amount of coverage. These bills will be a good foundation for much needed reform.

Sen. Paul Davis, R-Sangerville, is the Maine Senate Republican leader. Sen. Chandler Woodcock, R-Farmington, is the assistant Republican leader.