November 23, 2024
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Crafting health plan a battle Bill now lacking regulatory clout

AUGUSTA – After two weeks of closed-door negotiations with special interest groups, Gov. John Baldacci’s tough new health care reform proposal has emerged in a more conciliatory mood.

Trish Riley, architect of the complex plan that aims to provide universal health coverage while holding down costs, said Friday all of the players negotiating the numerous sticking points have “had to swallow hard” in arriving at acceptable compromises. Principal negotiators have included representatives from the Maine Medical Association, the health insurance industry and the Maine Hospital Association.

The amended bill lacks most of the regulatory clout of the original. Gone is the concept of a state-regulated global budget for hospitals, for example, a hot-button provision that the Maine Hospital Association claimed would cost hundreds of jobs, close hospitals, and lead to rationing of health services. In its place is a hospital study commission and a voluntary effort to limit hospitals’ profits and costs for one year.

Nor will the state claim a 4 percent assessment directly from the revenues of insurance companies to help fund enrollment subsidies for low-income Mainers.

Instead, insurers are committed to making a “good faith effort” to negotiate lower reimbursements with providers and to contributing a portion of the difference to Dirigo Health, a nonprofit insurance entity intended to provide universal health coverage. Insurance company contributions aren’t required until Dirigo has been up and running for three months, instead of funding it upfront as called for originally.

The revised Dirigo plan will rely on a voluntary insurance industry commitment to limit after-tax income growth to 3 percent for one year.

Other changes include:

. Separate spending caps for hospitals and doctors in determining state approval for the purchase of new medical buildings and equipment.

. A commitment from the state to try to increase Medicare and Medicaid reimbursements to hospitals and doctors.

. Easing of the requirement that physicians keep electronic records and post pricing information in their offices.

Steven Michaud of the Maine Hospital Association said negotiating the changes was hard on all involved.

“Everyone was hurting. Everyone had a pit in their stomach,” he said Friday.

Although the details and final language of the amendments still need to be worked out, “the stuff that was really over the top is gone,” Michaud said. He expressed confidence that out from under the threat of a global budget, hospital administrators will work together in “a truly voluntary environment” to reduce costs.

Bill Cohen, spokesman for Anthem Blue Cross and Blue Shield, said the main goal of the insurance industry is to preserve the competitive market in Maine. The changes in the bill offer a good compromise, he said, noting that under the plan the insurers will come under new regulation in increasing premiums to small businesses.

At the Maine Medical Association, General Counsel Andrew McLean said doctors are “delighted” that the state will focus on increasing Medicaid payments. “This has been our number one issue in the Legislature for years,” he said. Although physicians would prefer not to be included in the review process for new building and equipment, McLean said, “We can live with it.”

Joe Ditre of Consumers for Affordable Health Care said the greatest achievement is “the governor was able to get the bomb throwers at the Maine Hospital Association to stop their scare tactics and come to the table to negotiate.”

Many details remain to be worked out, and absent the threat of government regulation, Ditre said he’s skeptical the major players will make much progress in cost containment. “Everyone’s anxious to see the final language of the bill,” he said.

Although clearly smarting from some of the concessions she and her staff have had to make to get the governor’s bill to the Legislature, Riley said the good news is the Dirigo plan still is alive. Despite the loss of the regulatory “stick,” she said, there still is real cost containment through the spending cap on major medical projects and a provision for disease management in the insurance coverage the program will offer.

If after a year, “things don’t look like they’re going the way we think they need to go, we can bring this all up again,” Riley said.

The amended bill will be presented early next week to the special Joint Select Committee on Health Care Reform.


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