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Q. What is the Dirigo Health Reform Act?
Q. How is the Dirigo Health Act administered?
Q. What is the Dirigo Health Agency?
Q. What is the Governor's Office of Health
Policy and Finance (GOHPF)?
Q. How will Dirigo Health control rising health care costs?
Q. Go to Electronic Benefit Transfer (EBT) FAQ
Q. Go to Small Business FAQ
Q. Go to DirigoChoice Financial Discount FAQ
Q. Go to Dirigo SOP Payment FAQ
Glossary of Dirigo Health Terms
Q. What is the Dirigo Health Reform Act?
Proposed by Governor Baldacci, revised and improved by the Legislature, the Act was signed into law in June 2003. It represents a broad strategy to improve Maine's health care system and includes three inter-related approaches: a new health plan (DirigoChoice") to achieve universal access to health coverage; new and improved systems to control health care costs; and, initiatives to ensure the highest quality of care statewide.
Q. How is the Dirigo Health Act administered?
Many agencies of State government have responsibility for administering parts of the Dirigo Health plan. Because it addresses the system of health care, its administration is multi-faceted. The Bureau of Insurance, the Department of Human Services and the newly created Dirigo Health Agency share responsibilities with the Governor's Office of Health Policy and Finance. That office will coordinate implementation of Dirigo Health across all state agencies.
Q. What is the Dirigo Health Agency?
An important part of Dirigo Health reform includes the creation of a new health program designed to be affordable to all of Maine's uninsured citizens. The Dirigo Health Agency will administer the Dirigo Health plan and establish the Maine Quality Forum. The Dirigo Health agency is an independent agency with a Board of Directors nominated by the Governor. The Board includes five individuals serving staggered terms, appointed by the Governor and approved by the Maine State Senate. There are an additional three ex-officio members from State government serving as Board members.
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Q. What is the Governor's Office of Health Policy and Finance (GOHPF)
Created by the Governor in January 2003 and under the direction of Director, Trish Riley, GOHPF directed the development of the Dirigo Health Reform Act and retains overall responsibility for the Dirigo Health Reform Act and serves as a liaison to the new Dirigo Health Agency. Additionally, it directs health policy for the Governor's Office and State Government.
Q. How will Dirigo Health control rising health care costs?
Dirigo Health is working with industry and advocacy leaders on developing a State Health Plan to strategically guide future investments in health services statewide. For planning purposes, insurers and providers are agreeing to voluntary one-year limits on cost growth and one-year limits have been imposed on costly new construction that drive rising costs. The State Health Plan is strengthening review of proposals submitted for approval of costly investments in health care facilities, technologies and new services under the Certificate of Need program. Reductions in bad debt and charity care will result in less cost-shifting to premium payers and there
will be strengthened review of premium rate increases.
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Glossary of Dirigo Health Terms
Adverse Selection
Bad Debt and Charity Care
Capital Investment Fund
Certificate of Need
DirigoChoice
Federal Eligibility Level
MaineCare
Multiple Employer Welfare Arrangements (MEWA's)
Savings Offset Payment
Small Business
State Health Plan
Third-Party Administrators (TPA's)
Adverse Selection
The health insurance equivalent of buying insurance when your house is on fire, adverse selection occurs when disproportionate numbers of sick people join a health plan.
Bad Debt and Charity Care
This represents care given by hospitals but not paid for by the patient. Hospitals are required to administer needed care to individuals regardless of ability to pay. When patients can't pay for the care they receive, hospitals are compensated by raising their rates on insurance companies and others who can pay. This rate increase represents a hidden tax and is passed on to all health consumers through higher insurance premiums.
Capital Investment Fund
As a component of the State Health Plan, it will direct the Certificate of Need process. The fund represents a budget upon which approval for new constructions or new acquisitions of technology will be based.
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Certificate of Need
When providers seek to invest in capital improvements costing over $2.4 million or in new technologies over $1.2 million, they must apply to the state for Certificate of Need approval. The State Health Plan and Maine Quality Forum will strengthen this process.
DirigoChoice
One piece of a three part strategy to improve Maine's health care system, it is an affordable, comprehensive health plan offered to small businesses, self-employeed, and individuals. After year one, it may be offered to larger businesses.
Federal Eligibility Level
Determined by the federal government and updated annually, this income guideline
is used to determine eligibility for various state and federal assistance
programs - Medicare, Medicaid (MaineCare), LIHEAP, etc. DirigoChoice offers
discounts on monthly payments and reductions in deductible and out-of-pocket
costs on a sliding scale to enrollees with incomes below 300% of the Federal
Eligibility Levels. This translates to approximately $28,000 in yearly household
income for an individual and $56,500 for a family of four. The lowest income
enrollees will receive the greatest level of subsidy.
| 2004 Federal Eligibility Level Guidelines | ||||||
| Household Size |
100% | 125% | 150% | 200% | 250% | 300% |
| 1 | $9,310 | $11,638 | $13,965 | $18,620 | $23,275 | $27,930 |
| 2 | $12,490 | $15,613 | $18,735 | $24,980 | $31,225 | $37,470 |
| 3 | $15,670 | $19,588 | $23,505 | $31,340 | $39,175 | $47,010 |
| 4 | $18,850 | $23,563 | $28,275 | $37,700 | $47,125 | $56,550 |
| 5 | $22,030 | $27,538 | $33,045 | $44,060 | $55,075 | $66,090 |
| 6 | $25,210 | $31,513 | $37,815 | $50,420 | $63,025 | $75,630 |
| 7 | $28,390 | $35,488 | $42,585 | $56,780 | $70,975 | $85,170 |
| 8 | $31,570 | $39,463 | $47,355 | $63,140 | $78,925 | $94,710 |
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MaineCare
MaineCare is Maine's state Medicaid program. It is funded by a federally determined formula that combines state and federal revenues at an approximately 34% state and 66% federal dollar split. MaineCare provides an array of medical services to children, childless adults, families, senior citizens and the disabled. Eligibility is based on household income and varies between group and type of service. Assets will also be considered in determining MaineCare eligibility.
For more information, click here to visit the Bureau of Medical Services website or click here to view the annual BMS MaineCare Report. Another resource for learning of MaineCare eligibility is a report produced by Maine Equal Justice Partners.
Multiple Employer Welfare Arrangements (MEWA's)
An employee health plan established for the purpose of offering or providing any welfare benefits to employees of two or more unrelated employers.
Savings Offset Payment
After year one of operation, the Dirigo Health Plan will be funded in part by an assessment on the gross premium revenues of insurers not to exceed 4% and by an assessment, to be determined, on third-party administrators, Multiple Employer Welfare Arrangements, and self-funded employee health plans. These assessments will only be levied if savings in the health care system can be documented; notably through the reduction of bad debt and charity care expected to occur as the uninsured receive coverage, the State Health Plan and other cost containment provisions.
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Small Business
Within the Dirigo Health Plan, a small business represents fewer than 50 employees.
State Health Plan
The State Health Plan will assess the health care needs of Maine citizens and the public and private financial, capital, and personnel resources available to meet those needs. It will include a global budget to direct public and private efforts to meet those needs within the resources available. The first draft State Health Plan was issued in May 2004.
Third-Party Administrators (TPAs)
Independent agencies, TPAs are often hired by larger businesses with self-funded employee health plans to administer benefits.
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