Plan would require health insurance

State panel drafts proposal to insure all workers

November 17, 2006|By M. William Salganik | M. William Salganik,Sun reporter

Marylanders would be required to buy health insurance under a draft plan outlined yesterday by the staff of the Maryland Health Care Commission.

The plan would be a radical change from the current system of employers choosing which health plans to offer to workers. It would set up an insurance exchange where individuals could choose from any plans offered by insurers and keep the same coverage when moving from job to job.

The plan wouldn't apply to large employers, but the cutoff on employer size hasn't been set.

Employers would pay much of the cost, with each employer setting a dollar figure it would contribute toward the purchase. And the state would provide a subsidy for lower-income workers.

If enacted, the plan would make Maryland the second state to require health insurance. Massachusetts passed an ambitious plan to provide coverage for virtually all of its residents last year, but the plan hasn't gone into effect.

The Maryland version, called Maryland Health, is, however, a long way from adoption. Key details - including the cost of subsidies, who would be eligible to purchase from the pool, how premiums would be set, and the penalty for individuals who don't buy insurance - remain to be worked out.

The commission staff, which expects the results of consultant studies and economic models within the next few weeks, hopes to have more details for the commission to review next month and for the legislature to consider in January.

"This is not a proposal," said Stephen J. Salamon, the commission's chairman, who was appointed by Gov. Robert L. Ehrlich Jr. "It is a work in progress." He said as the plan is developed more fully, the commission would be discussing it with legislative leaders and the administration of Gov.-elect Martin O'Malley.

The Maryland Health plan adds more fuel to a legislative session in which covering more of the uninsured - an estimated three-quarters of a million Marylanders - was likely to be a major theme.

During the campaign, O'Malley said he would look for ways to expand the state's existing pool for small employers and to provide state subsidies for lowering premiums.

The Maryland Citizens' Health Initiative and MedChi, the state medical society, are pushing a plan to increase cigarette taxes by a dollar a pack, raising some $200 million a year that could be used to expand Medicaid to cover more low-income adults and to subsidize small businesses that can't afford coverage. The Maryland Hospital Association has made coverage expansion its top legislative priority for this year.

"If you look at the politics of the new administration and legislature, it's more feasible to get all the parties together," Calvin Pierson, president of the hospital association, said.

Dr. Rex Cowdry, executive director of the commission, said that although he hoped to begin a full discussion this year, "it's very hard to get agreement on a huge reform in one session - nor is it necessarily wise."

Coverage expansion is hardly a new topic for the legislature. This year, lawmakers overrode an Ehrlich veto and passed the so-called "Wal-Mart bill," requiring large employers to spend at least 8 percent of payroll on health insurance or pay the difference as a penalty to the state. That law was blocked in July by a federal court.

The Maryland Health plan doesn't include any mandate on employers - making it different from the Massachusetts law. But Cowdry said "individual responsibility would put greater pressure on employers" to "be in the game" by contributing to insurance coverage.

The individual requirement, too, can be controversial. A bill to require high-income Marylanders to buy health coverage - studies show about a third of the uninsured in the state make $50,000 or more a year - has been introduced several years in a row, but hasn't gained much traction.

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