March 28, 2024
Column

Is Dirigo health plan right for Maine? Yes. Gov. Baldacci’s plan has low overhead and more accountability

Last year at this time, I was asked to give a two-hour talk to medical students at a major Canadian medical school titled, “The U.S. Healthcare Delivery System for Dummies.” Although I realized quickly it was not hard to fill a time slot with useful information for eager students, preparing my talk turned out to be much more revealing. In fact, one hour into my research, I suddenly recognized I was the “dummy” because I could not dissect our own complicated and perplexing system, despite having studied and written about this for more than a decade.

After much effort, and with some help from other investigators, I approached the problem by asking two fundamental questions: 1. How are health care delivery programs financed, and 2. how are these delivered. What I subsequently learned was that we have a patchwork system in which there is public financing of some privately delivered programs (e.g. Medicare and Medicaid), but in general is heavily weighted toward private funding (e.g. premiums, out of pocket costs, etc.) for privately administered and delivered systems.

And, therein lies both the problem and the solution. Publicly financed programs have low overhead and more accountability. Privately funded and administered delivery programs have huge indirect costs, rising premiums and issues related to accessibility. In the United States there are now more than 40 million uninsured Americans, that is, individuals not covered by public programs and unable to afford private plans.

Inevitably when these people get sick, many will avoid entering the system due to cost, thereby further delaying their care and eventually increasing expenditures. Those that do see physicians or enter the ER, get reasonable care, but at the cost of shifting those bills to others who can pay. This burden becomes overwhelming because health care in the United States is based on competition, the “sink-or-swim mentality.” Many individuals and small businesses in Maine are sinking as expenditures for health care have risen, the proportion of individuals without insurance has expanded, and the cost of privately administered insurance premiums has soared out of sight.

Enter Dirigo. Gov. John Baldacci has proposed a novel and exciting program to address these failures in Maine by beginning to shift the public-private mixture more to the public side of the equation. The reasons for this are clear if the reader goes to the Maine government Web site (http://www.maine.gov/governor/bal-dacci/health policy/reformproposals/).

Simply put, the cost of privately administered and delivered health care programs is out of control. Maine unlike other New England states, has shown alarming increases in the following categories: inpatient hospital costs per discharge, hospital profitability and, most significantly, capital expenditures for all Maine hospitals.

Furthermore, there are tremendous barriers to accessing this system. More than 11 percent of Maine people report not visiting a physician because of cost. Yet, this is not due to individuals who are impoverished. One in 6 Mainers lack insurance coverage, but 80 percent of these people work. And, more than 50 percent of those uninsured have income levels at least 200 percent over the federal poverty level. Complicating access is the problem of maldistribution of primary care physicians in a rural state, the high cost of prescription drugs and the exponential rise of insurance premiums.

To address these issues, the governor has proposed a major overhaul in the state’s health care delivery system to guarantee universal access and take control over spiraling costs. The five specific aims of Dirigo have been noted in this newspaper previously but are worth emphasizing in the context of private-public mixes:

1. Create Dirigo Health, a health insurance program with oversight by the state but administered privately, that would offer comprehensive affordable insurance to families, the self employed and workers in small businesses (i.e. a shift from private to public oversight);

2. Provide coverage for all uninsured individuals who earn up to 300 percent of the federal poverty level (i.e. approximately $46,000 a year for a family of three) and allow uninsured people over 300 percent FPL to purchase coverage at cost. This would effectively reduce or eliminate cost shifting [i.e. a shift from private to public administration of insurance];

3. Develop a comprehensive state health plan and board including a global budget to set goals for access, cost and quality as well a one year ban on new building projects for hospitals and other providers; (i.e. a push for public planning);

4. Use group purchasing for uniform information technology and reduction of the indirect costs associated with billing and delivery. Dirigo would also limit price increases for insurers and providers through the State Health Board (e.g. a public board that would reduce indirect costs and regulate insurers).

5. Establish the Maine Quality Health Forum for evidence based practice information/guidelines, and greater consumer information and dissemination(a public effort to educate physicians and consumers).

This brief “Dirigo for Dummies” is brought to you by a health care provider who is concerned that too much “knit picking” of this plan will lead to its premature demise. Undoubtedly, each interest group or provider can find faults with the proposal, and already have, including selected columnists for this paper. Dissent is healthy, but in this case, it is mandatory that we focus the discussion of this proposal on its merits and the means proposed to achieve those five specific aims, rather than items that have been deleted or undeveloped.

Most of the arguments against this proposal generally come from those most likely to lose something (probably money), in a new revamped health delivery system. They also remind me of something I learned while serving as permanent chairman of a National Institutes of Health review panel on scientific grants for bone diseases. In the context of peer review and cost effectiveness, future scientific directives are constantly debated and charted. As we have often remarked, the best NIH grants are the ones that “sing” loudly in respect to innovativeness and feasibility. Dirigo “sings” to anyone interested in improving the health of Maine citizens. Let’s get on with moving that tune forward.

Dr. Clifford J. Rosen is medical director of the Maine Center for Osteoporosis Research and Education at St. Joseph Hospital in Bangor.


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