Strategies to Address Health Care Access

1. Create Dirigo Health
Dirigo Health will offer, through private insurance carriers, Dirigo Health Insurance (DHI), comprehensive, affordable health coverage to workers in small businesses who work 15 hours a week or more, self-employed persons, individuals without access to employer coverage, and their dependents. Employers participating in Dirigo Health would benefit from lower rates due to pooling of employer, employee, state and federal funding sources. To participate, employers must pay at least 60% of combined individuals/dependent premium costs. Dirigo Health will ensure that private plans delivering DHI meet high standards for quality and limit expenditures on administrative costs.

2. Provide Subsidies to Eligible Maine Residents
MaineCare will be extended to parents with income up to 200% of poverty and childless adults with income up to 125% of poverty; this expansion does not require any federal waivers. MaineCare enrollees whose employers participate in Dirigo Health will have the option of getting coverage through their employer's plan with a MaineCare wrap-around or enrolling directly in MaineCare. Workers ineligible for MaineCare will receive assistance in purchasing DHI coverage on a sliding scale based on ability to pay if their income is below 300% of the Federal Poverty Level ($26,940 a year for an individual, $45,780 for a family of 3). Similar workers in large, fully insured businesses will be eligible to have a portion of their premium subsidized. Uninsured residents with incomes over 300% of poverty may purchase at cost the coverage available through Dirigo Health.

3. Pool Resources to Finance Dirigo Health
Assistance for Maine residents up to 300% of poverty will be financed by pooling individuals and small businesses, by pooling contributions from employers, individuals, state and Federal funds and by recovering and redirecting 60% of the funds currently spent on bad debt and charity care. By pooling these resources, access can be achieved without new state appropriations.

Strategies to Address Health Care Costs

4. Develop State Health Plan to Connect Resource Allocations with Public Health Goals
This plan will set explicit, measurable goals to address quality, cost and access to health care and will establish a budget to assist in resource allocation. A CON Capital Investment Fund will guide expenditures on new capital investment. The Governor's Office of Health Policy and Finance will be responsible for creating the plan with guidance from an 11 member Council on State Health System Development.

5. Strengthen Certificate of Need to Better Control Costs
A moratorium will be placed on CON for one year, while the State Health Plan and Capitol Investment Fund is developed. Exceptions can be made for emergency needs. The CON program will be revised to cover functions and expenditures regardless of site of care; respond to clear goals and criteria established in the Plan and will operate on a budget allocated during 2 competitive review cycles. Ad hoc expert panels and formal review by the Bureau of Insurance and Bureau of Health to assess implications on insurance costs and health goals will be provided.

6. Plan for Hospitals for Maine's Future - Voluntary Hospital - Physician Cooperation
The State will work with the Maine Hospital Association, the Maine Medical Association and the Maine Osteopathic Association from June 1, 2003 - March 2004 to develop a plan to address primary and acute care needs in Maine. Plans will be developed to assure the best constellation of hospital and related services for the future, to strengthen rural health and identify specialty centers for primary care and prevention, as well as specialty acute care services. This plan will be driven by a hospital services budget to reallocate resources to better serve Maine. Statutory language will be enacted to allow cooperative planning without violation of anti-trust laws. The work will inform the State Health Plan and CON Capital Investment Fund.

7. Disclose Health Care Pricing to the Public
To provide greater transparency and accountability on the part of providers and insurers and to better inform consumer choices, we will require disclosure of average charges and payments accepted for certain commonly performed services at hospitals, physician's offices and other providers such as health centers. This information will be required to be posted and available at each provider site will be published on the Maine Quality Forum website.

8. Simplify Administrative Functions and Reduce Paperwork
By late fall 2003, HIPAA requires use of standardized billing forms and codes and each insurer will implement systems to accept electronic claims from providers. We propose mandating that all providers use electronic claims submission, data exchange, referral submissions/approval and eligibility verification by 2005. The State will seek funding to facilitate this requirement by making available grants and loans for providers.

9. Enhanced Public Purchasing
The Governor will create by Executive Order a Public Purchaser's Steering Group to coordinate public entities and improve their capacity to purchase cost effective, high quality health services.

10. Strengthen Oversight of Insurance Costs
Insurance regulations will be revised to require rate approval in the small group market and to increase accountability in the large group market by requiring insurers to file an actuarial certification, stating that rates were developed in accordance with all relevant state requirements. In addition, standard reporting definitions will be established and required to make annual reports comparable and understandable to the public.

11. Reduce Cost Shifting
If insurance coverage is extended to the uninsured, a significant reduction in bad debt and charity care will result. Those costs are now shifted to private payers. As such, bad debt represents a substantial hidden tax on health insurance costs and premiums; in fact, 16% of total premium costs today are attributable to bad debt and charity care costs. We will recoup some of the estimated costs of bad debt and charity care through assessments on insurance premiums to provide access to uninsured individuals and families.

MaineCare reimburses providers at lower than market rates. Savings accruing to MaineCare through enactment of this reform proposal will be available for future rate increases for providers, with a focus on paying providers based on performance goals.

12. Voluntary Limits to Control the Growth of Insurance Premiums and Health Care Costs
Building on a proposal from a collaborative in Southern Maine, the Health Care Challenge, we will ask all providers to hold price increases and operating margins to no more than 3% and insurers to limit underwriting gains to 3% through 2004. Utilization will be closely tracked as well and a report made at year end to determine the effectiveness of voluntary controls. The Governor's Office of Health Policy and Finance will be authorized to develop rate setting, global budgets and other mechanisms if voluntary measures are deemed ineffective.

Strategies to Address Health Care Quality

13. Establish the Maine Quality Forum
The Forum will be an independent, quality watchdog and resource center with its own advisory board. It will promote rapid deployment of evidence-based medicine and best practices; measure, compare and report on health care performance; conduct consumer education and conduct technology assessments to guide the diffusion of new resources. The Forum will be financed, in part, through the recovery of bad debt and charity care expenses.

14. Promote More Effective Use of Data
The Governor's proposal calls for greater integration of state data into the Maine Health Data Organization's database to cultivate a valuable resource for health planning, oversight and quality improvement. The MHDO database will be complemented by private sector databases managed by the Maine Health Data Partnership. The enhanced data set will support the design of the State Health Plan, administration of the CON Program, efforts of the Maine Quality Forum, assessment of the voluntary cost containment initiative, and will be a resource for policymakers, planners, researchers and the public.

The MHDO will use the data to prepare publications comparing Maine's health system performance against an array of measures. This information will be made available in an accessible fashion to the public to assist them in making comparisons between providers relative to cost and quality.

15. Protect the Fund for Healthy Maine
The Governor will propose a Constitutional amendment to protect for perpetuity the Fund for Healthy Maine and its public health expenditures. In seeking this Constitutional amendment, Maine would become the first state to so protect funds available from the tobacco settlements and assure their on-going availability for public health, prevention and access initiatives.

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