AUGUSTA – A special task force suggests raising several state taxes to help pay for and expand the state’s DirigoChoice health insurance program.

The Blue Ribbon Commission on Dirigo Health, which met for the last time Tuesday, also voted to recommend that Maine join Massachusetts, Vermont and several other states in requiring all residents to have health care coverage.

In addition, the task force said that virtually all large and small Maine employers should be required to offer coverage to their workers or contribute to a public health care fund.

The commission will submit its recommendations in a final report to Gov. John Baldacci by the end of the month. The governor and his advisers will determine which recommendations offer the greatest opportunity for positive change and incorporate them into legislation for review by Maine lawmakers during the coming session of the Legislature.

Charged by the governor with finding an alternative to the current funding mechanism – the so-called Savings Offset Payment, or SOP, that has undermined the success of DirigoChoice since it opened for business two years ago – the group readily turned to the General Fund, beefed up with proposed new tax revenues, as a substitute.

Nonessentials such as cigarettes, snacks, sodas, beer and wine are on the list of items that might be taxed higher to raise some $87 million a year, more than enough to cover the cost of running the Dirigo Health Agency and providing the income-based subsidies that make the insurance coverage more affordable.

DirigoChoice, which was providing 10,000 individuals and small businesses access to affordable health insurance as of this summer, will cost the state $57 million next year, according to administration officials.

The task force was asked to revisit the SOP, which is a complex calculation designed to determine the savings realized within the health care system as a result of various cost-containment and efficiency measures within the Dirigo initiatives. The law requires the Dirigo Health board to determine the value of the savings each year; private insurance companies and self-insured businesses then must pay a portion of that amount into the Dirigo plan to cover the cost of premium subsidies.

The SOP has been a source of conflict and litigation since it was imposed, with insurers insisting the agency-determined savings were inaccurate and not reflected in the claims they were processing from health care providers. Instead of paying the SOP out of the increased profits they were supposed to be realizing under Dirigo, the insurers ended up passing the cost on to their customers through premium increases.

Insurers, business groups and some consumers have protested that the DirigoChoice program provides subsidized insurance coverage to low-income Mainers by raising costs to those already struggling to pay their premiums. Hospitals, insurers and the state Chamber of Commerce sued the state over the policy. Although the court has upheld the measure as legal and constitutional, Baldacci ordered the second-year SOP of some $31 million suspended while an alternative source of funding was sought.

The governor appointed the 20-member blue ribbon commission last spring, drawing representation from doctors, hospitals, the insurance industry, businesses and consumers – including many of the same players who hammered out the convoluted Dirigo Health initiatives shortly after Baldacci was first elected in 2002. While the commission members voted to jettison most of the SOP, they agreed to retain the portion that directly measures the money hospitals save by providing less free care to fewer uninsured Mainers.

In addition to proposing new taxes and mandated insurance coverage, the panel members revisited a number of issues related to the state’s failing insurance market. Among the many recommendations they will make:

. Establish a modified high-risk pool to reduce the cost of paying for the heaviest users of health care.

. Merge the high-risk individual and lower-risk small-group markets, potentially reducing costs within the skyrocketing individual market.

. Help consumers shop for insurance by developing a public Web site with apples-to-apples comparisons between plans.

. Require insurers to provide premium discounts for healthful lifestyles such as participation in workplace wellness and smoking cessation programs.

. Require insurers to allow families to keep dependents on their policies up to age 30.

Commission Chairwoman Dr. Sandra Featherman, former president of the University of New England, said Tuesday that the state is making progress toward a shared goal of universal access to health care for all Maine residents. While states cannot solve all the woes of the nation’s troubled health care system, she said, they must take action in the absence of change at the federal level.

“States are the laboratories of health policy reform,” she said.

Featherman said that while there are major differences among commission members, everyone agrees that Maine must expand health care access. An estimated 130,000 Mainers now lack insurance.

Responding to the commission’s recommendation to require health insurance, the state director of the National Federation of Independent Business said an employer mandate will not sit well with Maine businesses.

“NFIB will oppose this outrageous and ill-conceived proposal,” David Clough said in an e-mail. “The commission failed to consider the effects on small-business owners.”

Trish Riley, Baldacci’s health policy director, said the current system of trying to pay for DirigoChoice by recapturing savings through the savings offset payment was reasonable but too complicated and contentious to survive.

“It was clearly just too difficult a concept to make real,” she said, adding that the state remains committed to holding down costs in the health care system.