AUGUSTA – House Republican Leader Josh Tardy and other top GOP legislators said the House vote today to fund Dirigo Health by taxing medical claims paid reveals the bankruptcy of the governor’s signature program. The House voted 84-58 to approve LD 1264, which would levy a 2.4 percent “access payment” on all paid claims by health insurers. The vote followed party lines, with Republicans on the losing side.

“The Democrats repeated attempts to prop up Dirigo clearly ignore the voters’ message from last fall,” said Rep. Tardy (R-Newport). “I doubt the voters will be amused to see the same tired tactic being rolled out again. In the last election, voters rejected not only the beer and wine tax but also the health access surcharge.”

Rep. Wes Richardson (R-Warren), the ranking Republican on the Insurance and Financial Services Committee, said the 2.4 percent fee amounts to “a tax on doctors’ bills. They can dress it up any way they want,” he said, “but the fact remains that they are taxing health care by some people to pay for health care for other people. Health insurance in Maine is already the second-highest in the nation. I can’t understand why Democrats think it’s smart policy to make it even more costly.”

Rep. Jon McKane (R-Newcastle), who has sponsored major health care reform legislation, said the tax on medical claims shows that the Democrats are “bankrupt” when it comes to ways to fund Dirigo Health. When the program was launched in 2003, amid great fanfare, proponents boasted that it would eventually cover all 140,000 Mainers without health insurance. “Instead, they have around 10,000 people enrolled,” said Rep. McKane. “The program fundamentally does not work, but it sucks up huge amounts of money from Maine taxpayers.”

Rep. McKane introduced a bill this year to allow Maine residents to purchase health insurance out of state, where rates are generally much lower. Although the bill enjoyed strong public approval, House Democrats killed it on May 13. “It’s very unfortunate that we won’t have that out-of-state option,” he said. “It would have saved Maine families thousands of dollars a year. It would have brought insurance competition back to Maine and would have made programs like Dirigo unnecessary. That’s the real tragedy of our insurance fiasco.”

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