AUGUSTA – A bill that would eradicate private health insurance plans in the state of Maine has some other surprises lurking in the legal text that would make dramatic changes to health care and taxes for almost all Mainers.
A report by the non-profit Maine People Before Politics on the bill, L.D. 1611, which aims to provide a state program to fund universal health care coverage, highlights a few of the sweeping changes the law proposes, including the elimination of private health insurance plans and restrictions on what types of procedures would be covered under the new, single-payer government run health insurance plan.
On page 7 of the proposal, under “§7507. Revenue sources” the bill lays out a requirement that the state first determine the aggregate cost of health care in the state, then develops a premium structure for individuals to pay into the state before it goes on to instruct the state tax assessor to establish a new tax to make up the difference between the cost of the health care and the premiums paid.
That tax, which would need to cover the difference between a premium structure based on income and the actual cost of the health care consumed by Mainers would almost certainly become the single largest tax in the state.
According to data published by the Kaiser Family Foundation, in
2014, Maine spent about $9,531 per capita on health care. Using that number,
that would mean that Maine’s 1.34 million residents spent about $12.75 billion
on health care in 2014.
Adjusted for inflation (assuming health care costs only rose by
the same inflation rate as all other goods) that number becomes about $13.7
Maine currently spends a little under $4 billion per year overall
in our state budget, and about $1 billion of that goes toward the state’s share
of various Medicaid programs.
Part of the cost of the new plan would be covered by the new premium structure imposed on Maine people and that premium would be applied to both earned and unearned income. The remaining cost would be made up by adding a new business tax.
Because the bill does not calculate any of the premiums or tax
rates, it is unclear exactly what those tax rates would be. If the state were
to utilize that new tax to cover even 20% of the state’s overall health care
costs however, that tax at approximately $2.7 billion would dwarf the amount
the state collects in individual income tax revenue ($1.5 billion), sales tax
revenue ($1.7 billion) or corporate income tax revenue ($210 million).
The proposal also adds language to state law around “collateral”
that can be targeted to collect the cost of health care services provided to
individuals. Some of the items that would be added as health care “collateral”
which could be targeted include things you might expect, such as employer
medical plans, but the law also adds in “pension plans” as an item that can be
Maine People Before Politics also pointed out that the proposal
would create a board of seventeen members which would be appointed by the
sitting Governor, called the Maine Health Board.
Subject to confirmation by the Maine Legislature, those seventeen individuals would be responsible for oversight of the fund, including a determination as to which services would be covered. Under the proposal, that board would have the ability to deny a service if they saw no medical benefit to providing it. Maine People Before Politics said that means “government bureaucrats will decide what care you receive.”
The proposal also says that a health plan that covers the services provided in the plan it would create may not be sold in the state of Maine beginning on January 1, 2023.
L.D. 1611 “An Act To Support Universal Health Care” is sponsored by Rep. Heidi Brooks (D – Lewiston) and is cosponsored by the following legislators:
Senator Shenna Bellows (D – Kennebec) Rep. Kent Ackley (U – Monmouth) Rep. Jeff Evangelos (I – Friendship) Rep. Victoria Foley (D – Biddeford) Rep. Thom Harnett (D – Gardiner) Rep. Gina Melaragno (D – Auburn) Rep. Walter Riseman (I – Harrison) Rep. Michael Sylvester (D – Portland) Rep. Ryan Tipping (D – Orono)
Rep. Brooks has long been an advocate for a universal health care program, sponsoring a bill in 2017 with the same goals.
Testifying in support of that proposal, Rep. Brooks said universal health care was a ” more logical approach” and that it was the responsibility of lawmakers to address the health care needs of their communities.