DirigoChoice must remain affordable for Mainers

In January 2005 the state initiated DirigoChoice, which operates like a traditional health insurance plan. The main feature distinguishing it from other plans is that at the beginning of each enrollment year subscribers can apply for a discount that reduces monthly premiums, coinsurance and annual deductibles on a sliding scale depending on household income. That discount was initially funded by the state, with DirigoChoice projected to become self-supporting within a few years.

In a rate-setting hearing in Gardiner, members of the state Bureau of Insurance heard testimony from the state, the public, and representatives of Anthem Blue Cross/Blue Shield, the insurer that administers the state’s DirigoChoice health insurance plan for small businesses, sole proprietors, and individuals. Alessandro Iuppa, Maine’s superintendent of insurance, has 30 days after the hearing to set the rate DirigoChoice subscribers will pay in 2007.

This hearing followed on the heels of an October hearing that resulted in Superintendent Iuppa approving an average 16.7 percent rate increase for HealthChoice, Anthem’s own individual health insurance plan; actual premiums for some of those subscribers will rise from zero percent to 25.6 percent over the rates they paid in 2006.

Most of the attendees at the DirigoChoice hearing were Anthem counsel and representatives. Counsel from the Attorney General’s Office offered their own expert witness on behalf of DirigoChoice subscribers and both counsel for the state and Consumers for Affordable Health Care posed questions. Of the seven members of the public at the 8 a.m. hearing, five offered sworn testimony for consideration by the superintendent.

Superintendent Iuppa, who leaves his post Jan. 13, 2007, indicated he had also received about 30 letters and e-mails from the public opposing the proposed rate increase.

The two plans on the table at the hearing boil down either to raising premiums a lot as well as raising out-of-pocket medical expenses (the “proposed plan”), or to raising monthly premiums a lot more for all subscribers but retaining 2006 copays (the “current plan”).

Anthem endeavored to show that its rationale for its rate increase is based on actuarial analyses of the data it has collected in the 22 months since DirigoChoice began. Its witnesses argued that DirigoChoice subscribers are riskier (and therefore more expensive) than other insurance populations because a high percentage of them smoke, are overweight, lead sedentary lives, and are aging. Since all living populations are, in fact, aging, no evidence of that is necessary, but Anthem provided no statistics or data to support the other three assertions, either specifically for DirigoChoice subscribers or for subscribers of another plan for comparison.

Anthem also claimed, both during the public hearing and in voluminous pretrial written testimony, that two DirigoChoice policies further increase the cost of the program: the lack of a pre-existing condition exclusion (i.e., no waiting period before pre-existing conditions are covered) and the mental health parity clause (i.e., mental health care is covered at the same rate as other health). Regarding the pre-existing condition issue, Anthem didn’t present testimony or data to support their statement that subscribers not only “could” but were indeed entering and leaving the program according to their immediate need for medical services. The attorney general and consumers challenged Anthem’s undocumented assertions.

Several of the public who spoke pleaded with the bureau to not price DirigoChoice out of their reach. Subscriber Karen Baldauski testified that such an extreme rate increase would propel her into “the abyss of the uninsured.”

The fact is that many of Maine’s sole proprietors, small businesses, and individuals would not have access to affordable health insurance – and therefore affordable health care – were it not for DirigoChoice.

Comparable plans that feature traditional coverage such as small copays for office visits and prescription drugs, partial coverage for tests and hospital stays, and annual limits on out-of-pocket expenses, can be had only at monthly premiums of $1,000 and up, depending on household size. Other plans feature deductibles so high they are categorized as “catastrophic plans” that pay out only after a subscriber’s annual health care costs exceed $5,000 or higher.

No one envisions Maine in the 21st century returning to a state with a mill along every river and factories sprinkled around the state. We know the state’s economy increasingly depends on entrepreneurial efforts. Witness the small businesses and sole proprietorships that have popped up virtually everywhere.

With more of the state’s population earning income from small – and very small – businesses, more and more Mainers will look to innovative plans such as DirigoChoice to help us preserve our peace of mind, keep healthy, and stay rooted in the state.

We need action now to ensure that DirigoChoice remains a viable, affordable health insurance plan for Mainers well into the future, which will in turn assure Maine’s good health in the future.

Deborah Oliver is a DirigoChoice subscriber and advocate. She is the sole proprietor of Ab Initio (“From the Beginning” Publishing, Consulting and Editing) in Camden.