Tuesday, May 21, 2013
Sen. Rod Whittemore
When is the last time you heard good news about health insurance? I'm glad to say there's plenty to report, here in Maine, anyway.
The warnings two years ago from Democrats in the Legislature about Maine's new health insurance law were dire: It was going to end health insurance as we know it, making it inaccessible to average Mainers and send everyone's premiums skyrocketing. In short, a disaster.
As former chairman of the Insurance and Financial Services Committee, I played a major role in getting this bill out of committee, through the Legislature and onto the governor's desk for his signature. I am proud to tell you just the opposite has happened.
After a decade of becoming accustomed to double-digit increases as high as 19 percent, most Maine businesses are seeing one of two things in their company plans: a significant reduction in the amount of their increase or an actual reduction.
Public Law 90 was designed to introduce more competition in Maine's health insurance market. This was achieved, in part, by loosening the community ratings bands that forced insurance companies to charge everyone roughly the same rate, regardless of risk, age group and other factors.
The law also will eventually allow Maine residents to purchase health insurance across state lines, and it prohibits insurance companies from denying coverage because of pre-existing conditions.
The results have been remarkable. In the fourth quarter of 2010, before the law's implementation, only 2.9 percent of Maine businesses saw a decrease in their premiums. A year later, after the law had taken effect, 9.4 percent saw a decrease. In the fourth quarter of 2012, the number of businesses that saw a decrease rose to 17.5 percent.
Democrats recently have said most businesses have seen a premium increase since the passage the law. They are being intentionally misleading, however. Before the law was enacted, 9.2 percent of Maine businesses saw rate increases in excess of 40 percent. The reforms cut that number by more than half, to 4.4 percent in the fourth quarter of 2012. Most of the premium increases businesses saw over the last year were dramatically lower than the ones they had seen in recent years.
When the law was passed, a minority of businesses -- mostly in northern, rural areas -- did see sharp increases. The latest figures from Maine's Bureau of Insurance, however, indicate that their rates are now dropping.
Even more encouraging, according to the Bureau, the number of Mainers purchasing health insurance -- particularly young residents -- is on the rise, because the law has made it more affordable.
With more people buying health insurance, the rates will continue to decline.
The success of Maine's new health insurance law serves as a testament to the power of the free market and contrasts sharply with the Democrats' government-run approach to health insurance that led to skyrocketing rate increases and fewer people having access to insurance.
Democrats, who are now in control in the Legislature, have indicated they want to gut the law, despite its successes, probably because it differs from the state-controlled model they prefer. They have submitted a number of bills that would chip away at the provisions in the new law that have led to premium reductions and more choices for Maine consumers.
As the ranking Republican on the Insurance Committee, I plan to do everything in my power this legislative session to protect the new law that is finally bringing relief to Mainers who have, until the past two years, been conditioned to expect the worst when their insurance bill arrives.
Sen. Rod Whittemore, R-Skowhegan, serves on the Legislature's Insurance and Financial Services Committee.