Baldacci touts Dirigo Choice health program

At the State House on Monday, Gov. John Baldacci announced the start of state-subsidized health insurance in Maine. DirigoChoice, a critical piece of the governor’s Dirigo Health reforms, took effect over the weekend, with an estimated 1,800 people enrolled – employees of 216 small businesses and 867 sole proprietors from throughout the state.

The enrollment is a far cry from the 31,000 the state has said it hopes to have on the books by the end of 2005. Conservative organizations such as the Maine Heritage Policy Center have criticized the plan for not costing significantly less than other commercial insurance products and for employing a complicated financial strategy that relies on speculative Medicaid funding and payments from the insurance industry.

The Policy Center, which promotes free-market solutions to health care and other economic issues, says Maine people would be better served by reducing government mandates and supporting competition between insurers.

But Dirigo promoters on Monday were upbeat.

“These are real people, real businesses and real coverage,” Baldacci said at the media event. “Maine continues to be a national leader in improving health care for its citizens.”

Erin Hoeflinger, recently appointed vice president and general manager for Anthem Blue Cross and Blue Shield of Maine, which in June contracted with the state to administer the DirigoChoice plan, maintained enrollments are on track. “I think we are meeting our expectations; it’s doing very well for a new product,” she said in a telephone interview.

Hoeflinger said that in addition to Anthem agents educating business owners about DirigoChoice, the plan has been promoted through television and print ads and at community forums throughout the state.

The company includes the DirigoChoice product in its general marketing and provides financial incentives for its agents to sell the product to companies that currently offer no health insurance to workers, she said.

Both Anthem and the quasi-public Dirigo Health Agency are currently analyzing enrollment applications to determine how many of the 1,800 enrollees are newly insured, versus having switched from one insurance plan to another.

Compared with “catastrophic” plans that have relatively inexpensive monthly premiums and pay only when medical bills reach a certain threshold, DirigoChoice may cost more per month but provides a more comprehensive menu of benefits, including 100 percent coverage of routine preventive care such as well-child visits and mammograms. Other services, including mental health services, are typically covered at 80 percent of the provider’s fee. Medications are also covered.

DirigoChoice members with incomes of up to 300 percent of the federal poverty limit qualify for a subsidy to bring down their monthly premiums. In the first year, this subsidy is drawn from a $53 million one-time federal Medicaid grant; in the future, insurers will be required to pay into the subsidy fund. Low-income individuals can also benefit from a sliding scale of out-of-pocket spending limits.

In the Bangor Daily News readership area, small-business owners surveyed were mixed in their response to the announcement of the DirigoChoice rollout. Heather Davis, owner of the Cozy Moose Sporting Camps in Greenville, said she’d followed the development of DirigoChoice in the news and decided some time ago to make the switch. Davis’ employees have been covered under a different Anthem product, but without going into details, Davis said DirigoChoice “works better for us.”

It took a little effort to get the unusual insurance plan set up in the Cozy Moose accounting software, she said, but she’s confident it’s worth the effort. “Anthem is a reputable provider of health care,” Davis said, and having the company name on the Dirigo product gives her confidence.

In Old Town, Gary Sullivan, owner of Sullivan Automotive Services, said he hasn’t heard much about Dirigo in the past few months. About a year ago, Sullivan signed a contract with a different insurance company for coverage for his employees. He’s currently paying 50 percent of the premiums for seven full-timers.

“It covers everything,” the busy garage owner said, “but we’re always looking for ways to do it for less.” Sullivan said he’ll look into DirigoChoice now that it’s up and running. “It’s just a matter of finding the time,” he said.

At Northeast Historic Film in Bucksport, co-founder David Weiss said his office manager was still analyzing the benefits of switching to DirigoChoice.

“We’re skewed toward mostly older workers,” Weiss said, “and for that group, it may be that lower premiums would be offset by the higher cost they’d have to pay if something went wrong.”

Currently, Weiss said, some of his nine employees have the entire amount of their insurance payment deducted from their paychecks on a pre-tax basis. If the nonprofit organization switched to DirigoChoice, he observed, NHF would be required to pay 60 percent of the monthly premium. Even if the coverage is better, Weiss said, “It’s not like I can wave a magic wand. … I’d have to cut someplace else. And where would that be? The electric bill? I don’t think so. Someone’s job?”

Joe Ditre, executive director of the Consumers for Affordable Healthcare Foundation and a longtime supporter of the Dirigo initiative, said Monday the low startup enrollment reflects several factors. Ditre recalled that Anthem was unprepared for the deluge of calls it received in October when enrollments first opened, so some callers were frustrated by long waits or inaccurate information.

Ditre also said Anthem initially failed to tell people that subsidies and discounts were available, so callers came away “stunned” at the prices they were quoted. And, he cautioned, Anthem’s allegiance to promoting “the public good” through DirigoChoice is necessarily tempered by its interest in selling its other, more profitable, insurance plans.

“Overall, we’re pleased at the enrollment we’ve seen so far,” Ditre said, but he stressed that more must be done to raise awareness of the new product within Maine’s small-business community. “It will take more than glossy brochures and a few TV ads,” he said. According to Ditre, a more intensive enrollment campaign must include working with community organizations, faith-based groups and government agencies to get the word out.

Sharon Roberts, director of stakeholder relations for Anthem, said the company’s target enrollment for the end of 2005 differs from the state’s.

“From our perspective, 10,000 to 15,000 [members] would be great,” she said. “Anything over that would be exceptional.” Roberts said that because of contractual terms, enrollment in all health insurance plans tends to increase in the last half of the year, so she expects to see greater interest in DirigoChoice come summer.

In addition to small businesses and sole proprietors, DirigoChoice will begin accepting individual enrollment starting in February. For more information on DirigoChoice, visit http://www.dirigohealth.maine.gov or call Anthem Blue Cross and Blue Shield at (800) 409-7520.