View this article online: https://www.insurancejournal.com/news/east/2007/02/14/76946.htm
The Maine Supreme Court heard oral arguments Tuesday on whether first-year savings generated by the state’s Dirigo Health program were properly calculated.
Legal jousting over the program’s impact on insurance carriers and other businesses has continued even as Gov. John Baldacci weighs options for changes, possibly including a new financing mechanism.
Last August, Superior Court Justice Roland Cole rejected an appeal of a 2005 decision by Insurance Superintendent Alessandro Iuppa that Maine’s Dirigo Health Agency initiatives produced savings of $44 million in the program’s first year.
Cole said the petitioners’ main challenges focused on the methodology used by the Dirigo board of directors during the course of the regulatory proceeding and on the reasonableness of Iuppa’s decision. Cole said the court would “not second-guess the agency on issues within its area of expertise,” and that the superintendent’s decision was “supported by substantial evidence” in the case record.
The case, whose movers include the Maine Association of Health Plans, the Maine Automobile Dealers and the Maine State Chamber of Commerce, now goes before the law court as legislators await Baldacci’s next step.
The Dirigo Health Agency was established to promote affordable health care coverage, and a key part of the program is its subsidies for low-income individuals and business employees. Subsidies are funded in part from savings offset payments made by health insurance carriers.
Last month, a Blue Ribbon Commission on Dirigo Health Reform report to Baldacci called for health insurance mandates and added taxes on cigarettes, alcohol and snacks.
The governor said those and other changes were being analyzed by his staff and that he would be issuing his own proposals within weeks.
The blue ribbon panel included representatives of business, insurers, consumers, labor and the Dirigo Health board. It was united in its support for expanding Dirigo to cover more of Maine’s uninsured and underinsured people, according to its chairwoman, Sandra Featherman.
A majority of the commission’s members endorsed increased taxes that could include tobacco products, including 50 cents on a pack of cigarettes, a snack tax, a tax on soft drinks, beer and wine. The report also endorses the idea of employer and individual mandates to provide or obtain health insurance.
The report additionally suggests a self-insurance option for DirigoChoice, the program that has been covering 13,000 individuals and 2,300 businesses.
Addressing savings offset payments, the report suggested that providers, consumers, employers and insurers meet “as soon as possible” to modify the formula through which savings are captured and redirected.