HealthLawProf Blog

Editor: Katharine Van Tassel
Concordia University School of Law

Thursday, November 13, 2008

Subsidized Insurance Backed

The Washington Post reports that Maryland health advocates unveiled a $15.5 billion proposal yesterday for universal health care that would subsidize insurance coverage for low-income residents with a payroll tax and increases to cigarette and alcohol taxes.  Lisa Rein writes,

Stethescope3The Maryland Citizens Health Initiative also calls for mandated coverage for those who do not get it through their employer. The group pledged that the policies would be more affordable than they are now.

The coalition of labor groups, churches, businesses and community organizations consulted with health policy experts from the University of Maryland, Johns Hopkins University and the Robert Wood Johnson Foundation.

The plan aims to build on two programs the General Assembly passed last year, an expansion of the federal-state Medicaid program for the poor and subsidies to some small businesses to help them afford insurance.

But lawmakers and even the advocates acknowledged that the plan has no chance for passage soon.

"We don't expect it to pass in 2009," said Vincent DeMarco, president of the nonprofit Baltimore-based group. "This is the beginning of a campaign."

DeMarco called the plan a way to "make quality health care affordable to all, especially small businesses" and said his group will focus in coming months on building public support for it.

Del. James W. Hubbard (D-Prince George's) is expected to introduce a bill in the 90-day legislative session that begins in January.

Del. Peter A. Hammen (D-Baltimore), chairman of the House health committee, said the General Assembly has little appetite for costly programs in the current economy. But he said the plan "gives energy" to efforts to pass ambitious health-care legislation in a state with an estimated 700,000 uninsured residents.

The plan would allow small businesses and individuals to join an insurance pool, giving them leverage to negotiate lower rates for policies than on their own. Maryland would go into the insurance business, covering the costs of catastrophic care to lower premiums. To contain costs, patients would face higher co-payments for less effective and more expensive procedures.

A 2 percent payroll tax would be levied on all businesses, and the tax on cigarettes would jump to $2.75 a pack from $2 and alcohol by a dime.

The National Federation of Independent Business, a lobbying group representing small companies, said in a statement that higher payroll taxes would drive businesses out of Maryland.

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