Dirigo Health
Encyclopedia
Dirigo Health is a government agency run by the State of Maine
in the United States. It oversees the state's subsidized
health insurance
program, DirigoChoice. The program was launched in 2005, and takes its name from the state motto of Maine, Dirigo, which is a Latin phrase meaning "I Lead."
by Governor John Baldacci
in May 2003 and became law in June 2003. The law is a comprehensive reform
of the state's health care system
, addressing cost, quality and access. Along with DirigoChoice, it created the Maine Quality Forum, a State Health Plan and put forth measures to reduce the growth of health care
costs in Maine, including asking hospitals to voluntarily cap their annual cost increases at 3% per year and their operating margins at 3.5% per year. The law further expanded Medicaid
program in the State.
In 2002, it was estimated that over 100,000 Maine residents were uninsured. Almost 80% of enrollees have family incomes below 300% of the Federal Poverty Level. 700 small employers were enrolled in DirigoChoice, representing 2.5% of the firms that are eligible. The primary barrier for very small employers appears to be price. The revenues for the program have been lower than expected, creating political pressure to find other funding sources.
Harvard Pilgrim Health Care
became the insurance carrier for DirigoChoice effective January 1st, 2008.
Caps on enrollment were put into place in September 2007 which remain in place as of the November 2009 enrollment report.
, the initial carrier for DirigoChoice, says that enrollment rates for the program are significantly higher than other new insurance programs.
The Dirigo Health Agency Board of Directors has been accused of inflating the cost savings from the program to drive up the amount the State can recoup through the SOP. However, the final savings determination of $43.7 million was decided by the state's Superintendent of Insurance. His decision came after an independent and thorough review of testimony provided during an adjudicatory hearing from opponents and proponents to Dirigo. Several organizations within the State, including the Maine State Chamber of Commerce and the Maine Association of Health Plans, of which Anthem is a member, have brought legal action against the State to argue that the SOP is improperly calculated and assessed.
Maine
Maine is a state in the New England region of the northeastern United States, bordered by the Atlantic Ocean to the east and south, New Hampshire to the west, and the Canadian provinces of Quebec to the northwest and New Brunswick to the northeast. Maine is both the northernmost and easternmost...
in the United States. It oversees the state's subsidized
Subsidy
A subsidy is an assistance paid to a business or economic sector. Most subsidies are made by the government to producers or distributors in an industry to prevent the decline of that industry or an increase in the prices of its products or simply to encourage it to hire more labor A subsidy (also...
health insurance
Health insurance
Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care expenses among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is...
program, DirigoChoice. The program was launched in 2005, and takes its name from the state motto of Maine, Dirigo, which is a Latin phrase meaning "I Lead."
Origins
Dirigo Health was created as part of Maine Public Law 469, also known as the Dirigo Health Reform Act. It was originally presented to the Maine LegislatureMaine Legislature
The Maine Legislature is the state legislature of the U.S. state of Maine. It is a bicameral body composed of the lower house Maine House of Representatives and the upper house Maine Senate...
by Governor John Baldacci
John Baldacci
John Elias Baldacci is an American politician who served as the 73rd Governor of the U.S. state of Maine from 2003 until 2011. A Democrat, he also served as a member of the United States House of Representatives from 1995 to 2003....
in May 2003 and became law in June 2003. The law is a comprehensive reform
Health care reform
Health care reform is a general rubric used for discussing major health policy creation or changes—for the most part, governmental policy that affects health care delivery in a given place...
of the state's health care system
Health care system
A health care system is the organization of people, institutions, and resources to deliver health care services to meet the health needs of target populations....
, addressing cost, quality and access. Along with DirigoChoice, it created the Maine Quality Forum, a State Health Plan and put forth measures to reduce the growth of health care
Health care
Health care is the diagnosis, treatment, and prevention of disease, illness, injury, and other physical and mental impairments in humans. Health care is delivered by practitioners in medicine, chiropractic, dentistry, nursing, pharmacy, allied health, and other care providers...
costs in Maine, including asking hospitals to voluntarily cap their annual cost increases at 3% per year and their operating margins at 3.5% per year. The law further expanded Medicaid
Medicaid
Medicaid is the United States health program for certain people and families with low incomes and resources. It is a means-tested program that is jointly funded by the state and federal governments, and is managed by the states. People served by Medicaid are U.S. citizens or legal permanent...
program in the State.
DirigoChoice
DirigoChoice is a subsidized health insurance program available to Maine businesses with fewer than 50 employees, the self-employed, and other individuals. The program is funded through a one-time grant of $53 million from the State, employer and employee contributions, Medicaid payments, and an ongoing assessment on insurance entities known as the "Savings Offset Payment" (SOP) based on savings attributable to the operations of Dirigo.In 2002, it was estimated that over 100,000 Maine residents were uninsured. Almost 80% of enrollees have family incomes below 300% of the Federal Poverty Level. 700 small employers were enrolled in DirigoChoice, representing 2.5% of the firms that are eligible. The primary barrier for very small employers appears to be price. The revenues for the program have been lower than expected, creating political pressure to find other funding sources.
Harvard Pilgrim Health Care
Harvard Pilgrim Health Care, Inc.
Harvard Pilgrim is a not-for-profit health plan that provides a variety of insurance plan options and self-funding arrangements to more than one million members in Massachusetts, New Hampshire and Maine. Harvard Pilgrim was founded in 1969 out of the merger of the Harvard Community Health Plan and...
became the insurance carrier for DirigoChoice effective January 1st, 2008.
Caps on enrollment were put into place in September 2007 which remain in place as of the November 2009 enrollment report.
Controversy
Although proponents of the legislation that set up Dirigo Health projected that it could cover 31,000 previously uninsured Maine residents in its first year, the actual figure through the program's first twelve months was 8,600. After fifteen months, enrollment had grown to 9,800; an additional 4,900 people had enrolled in the Medicaid expansion. AnthemAnthem (insurance)
Anthem was an insurance company which began in the 1980s as a spin-off of the group insurance operations of American General Insurance. From its move to a publicly-traded company in 2001 until its final merger in 2004, it merged the Blue Cross Blue Shield organizations of several states to achieve...
, the initial carrier for DirigoChoice, says that enrollment rates for the program are significantly higher than other new insurance programs.
The Dirigo Health Agency Board of Directors has been accused of inflating the cost savings from the program to drive up the amount the State can recoup through the SOP. However, the final savings determination of $43.7 million was decided by the state's Superintendent of Insurance. His decision came after an independent and thorough review of testimony provided during an adjudicatory hearing from opponents and proponents to Dirigo. Several organizations within the State, including the Maine State Chamber of Commerce and the Maine Association of Health Plans, of which Anthem is a member, have brought legal action against the State to argue that the SOP is improperly calculated and assessed.