A Series of Unfortunate Events: Maine’s Failed Experiments With Big Government Controlling Health Insurance
Read the full report | As America looks at health care reform, policy makers would be wise to review Maine’s experience with government solutions intended to improve access, lower costs, insure more people and add fairness to the health insurance system. Maine’s experience with many of these exact same proposals drove up private costs, caused tens of thousands to drop private insurance, made Medicaid rolls skyrocket and drove away ten insurance carriers.
This document focuses on the Individual health insurance market because this small segment can be seen as an indicator of stability in a state’s health care financing system. These under-65, non-group policy holders are spending their own money for health insurance plans for themselves and their families and do not benefit from the tax incentives available for employmentbased plans. These vulnerable consumers may be seen as a “canary in a coal mine” indicator for the health insurance industry because they are more likely to react to policy rate increases, or personal income decreases, by reducing coverage or cancelling their health insurance.
The non-group market has been the focus of many reforms in Maine during the last two decades. Various mandates, regulations and even a “Public Option,” where a new state agency was created to develop, market and operate health insurance plans intended as a low-cost alternative to private insurance, have been introduced with promises of lower costs and better access to health insurance. They have not worked. In fact, these reforms have backfired on Maine non-group insurance buyers, resulting in higher costs, reduced choices, fewer insured people and a radical increase in the number of Maine people dependent on Medicaid.