Our announcement at a State House press conference drew coverage from the Bangor Daily News (BDN), MPBN, WABI-TV and WCSH-TV/WLBZ-TV.  And on 1/25, a Maine Sunday Telegram editorial declared that our proposal “deserves serious consideration.”

In fact, a review of the Maine media over the past week reveals a firestorm of criticism and opposition to the Administration’s plan and growing support for a more sensible alternative.

Maine Equal Justice Partners’ Sara Gagné-Holmes thoroughly discredited the repeated claims by the Governor and his allies by demonstrating in a 1/25 BDN op ed that the “childless adults” who would lose coverage “tend to be sicker, and often have serious medical conditions that limit their activities and ability to function without care.”

Much of the coverage has focused on concerns raised by local elected officials, physicians, hospitals, businesses and advocates for seniors, children and disabled people, including:

“Portland mayor decries proposed DHHS cuts” BDN, 1/31

“Portland Officials Balk at Proposed MaineCare Cuts” MPBN, 1/30

“Portland joins those opposing proposed Medicaid cuts” WCSH-TV/WLBZ-TV, 1/30

“Portland civic leaders oppose the governor’s plan to cut DHHS” WGME-TV, 1/30

“Group Proposes Alternative to MaineCare Cuts” WABI-TV, 1/30

“Market reforms will not result in health care for all in Maine” Portland Press Herald (PPH) op ed by Dr. Julie Pease, 1/30

“LePage health care proposalis shortsighted and costly” (Augusta) Kennebec Journal op ed by Dr. Laurel Coleman, 1/30

“Cuts to MaineCare hurt the entire community” (Lewiston) Sun Journal op ed by Laird Covey, President of Central Maine Medical Center and Lee Myles, President of St. Mary’s Regional Medical Center, 1/29

“Waterville City Officials Criticize Proposed MaineCare Cuts” WABI-TV, 1/26

“State cuts would hit Portland extra hard” PPH, 1/27

“Preventing prevention” (Brunswick) Times Record editorial, 1/26

“How DHHS cuts could affect seniors” (Biddeford) Journal Tribune, 1/26

Our partners at the Maine People’s Alliance have created a special website where you can view video clips from the press conference and add your name to the more than 2,350 who have already registered their support for our responsible solutions toward balancing Maine’s budget!

MECEP’s analysis at the time cautioned lawmakers to consider the adverse consequences for older Mainers and those in rural areas, particularly small businesses.  We reached out to legislators on both sides of the aisle and offered to explain our analysis and the implications of this proposal for their constituents.  None of the bill’s proponents took us up on our offer.  They seemed unwilling to consider any information that might challenge their assumptions or the merits of this proposal.  They even refused to let the Bureau of Insurance comment on the proposal.

MECEP insists on credible research and analysis and found the rush to enact this rollback of Maine’s health insurance consumer protections very troubling.

Now, a new report (“The Impact of PL90 on Maine’s Health Insurance Markets”), commissioned by the Maine Bureau of Insurance as an independent analysis, has confirmed exactly what MECEP predicted.  Today, the Legislature’s Joint Standing Committee on Insurance and Financial Services is holding a hearing to consider the results of this study by Gorman Actuarial.

In anticipation, MECEP and our partners at Consumers for Affordable Health Care (CAHC)  prepared a comparison of what proponents of PL90 said about the law during the 2011 legislative deliberations and the conclusions of the new report to demonstrate that many claims by PL90’s supporters were mistaken.

The evidence clearly shows that PL90 gives too much power and profits to private insurance companies, undermines important consumer protections, and fails to address the issues that result in out-of-control health care costs.  It is a flawed law that the Governor and the Legislature must act to fix it.

Perhaps more troubling, the survey shows that most indicators are moving in the wrong direction compared to a year ago and to the 2^nd quarter of 2011.

Full disclosure, I serve on the Federal Reserve Bank of Boston’s  Community Development Advisory Committee.  Unfortunately, today’s Maine Economic Forecast for 2012 from Muskie School of Public Service and noted economist Charles Colgan presents an even bleaker picture.

Clearly, jobs and support for the people struggling to make ends meet in this brutal economic climate will remain in the forefront of public policy debate here in Maine for the foreseeable future.  The current debate over the LePage Administration’s proposal to cut $220 million in cuts to the Department of Health and Human Services budget is a test of the direction Maine will take toward these challenges.  We have the capacity to respond to these challenges in a way that minimizes the recession’s impact on Mainers, creates jobs, and enhances future economic prospects.  Doing so requires our political leaders to move beyond ideology and anecdotes to craft solutions that are based on credible information and analysis.

Maine Equal Justice Partners recently released a critical report that tells the true story about MaineCare’s Childless Adult Waiver Program.  Media coverage was extensive, but failed to include any critical assessment of the claims made by the report’s naysayer.

The Maine Heritage Policy Center’s (MHPC) Lance Dutson made the most audacious claim that the current policy of providing health insurance to childless adults making less than $10,890 a year hurts the private insurance market. Dutson told Maine Public Radio that “when people are able-bodied, young people that are being pulled out of the private insurance market, I think that’s a group of people we have to look at.”

Dutson’s assertion assumes two things, both of which are false.  63%of the low-income adults covered by this program are 35 or older and 43% are 45 or older.  MEJP also cites DHHS analysis that found 47 percent of program participants fell into a major diagnosis grouping of cancer or disease; 24 percent had a diagnosis categorized as a mental disorder, and 11 percent were treated for an injury or poisoning- hardly the young and able-bodied population that Dutson suggests. In fact, if these individuals showed up in the private insurance market, rather than decrease the costs of insurance for everyone else rates would likely increase because of the level of services they would require.  If they had no insurance at all, the cost for care they receive would shift to health care providers in the form of uncompensated care, to local communities in the form of increased requests for general assistance and to the premiums of the insured when providers raise their rates to compensate. Shifting costs is merely a shell game which none of us wins.

This raises a critical question.  How can anyone with an income of less than $11,000 per year, even if they are young and able-bodied, ever afford meaningful private insurance coverage in the first place?

MHPC’s ideologically inspired vision of a perfectly competitive private insurance market that would dramatically increase access to care for all people is a fantasy particularly if people don’t earn enough to pay for coverage.  Suggesting that providing MaineCare coverage to low-income childless adults somehow hurts the private insurance market doesn’t even pass the straight face test.

The world is not flat and it is time we challenge the statements of those who would suggest otherwise.  When credible evidence is available to refute such claims failing to hold the critics accountable is irresponsible.

In the nearly two months since the Administration first declared a problem existed, there has been a series of assertions that have proven either to be untrue or to misrepresent the situation.

First, just two weeks after projecting a $71 million budget gap in the year ahead, DHHS Commissioner Mary Mayhew revised the estimate by a stunning additional $50 million to $121 million ($220 million over two years).

Then, after weeks of Administration claims that the shortfall was the result of a massive influx of people into MaineCare, its own report to legislators admitted that it was “the result of a series of technical budgeting miscalculations” and the “[i]ncreased enrollment accounts for just $6.5 million” of the shortfall.

Next, in a move that introduced more divisiveness into the discussion, Governor LePage asserted that “there are more Mainers receiving welfare benefits than there are income tax filers paying taxes.”  In response, MECEP Executive Director Garrett Martin told the Portland Press Herald that “this is an unfortunate mischaracterization of what’s at stake here.” Citing Maine Revenue Services statistics he countered that families in the bottom 20 percent in terms of income actually have the highest tax burden of any income group.  ”While some people don’t earn enough to have an income tax obligation, they are still paying taxes that support a range of programs and services,” Martin explained.

The Administration continued to pit Mainers versus Mainers with its plan to deny MaineCare to an estimated 19,000 childless adults, suggesting that failure to adopt cuts to MaineCare would result in cuts to education and even going so far as to lay part of the blame on the state’s welfare spending (erroneously as it turns out) for Forbes magazine’s poor ranking of Maine’s business climate.

Meanwhile, the looming cuts in the Administration’s proposal have caused unnecessary anxiety for families across Maine, especially those with members residing in PNMIs or relying on programs like prescription drug assistance for seniors.

Further muddying the waters, the Governor assured legislators that the federal Department of Health and Human Services would grant the state waivers from provisions in the new Affordable Care Act that “prohibits states from making it more difficult to enroll in Medicaid.”   The (Lewiston) Sun Journal called the Governor’s claim “at best, uncertain,” adding that “Maine would have to obtain waivers that the federal government appears not to have granted anywhere else.”

In an editorial the Maine Sunday Telegram stated that “if Gov. LePage were a doctor, he might be sued for malpractice.” The Bangor Daily News went even further, accusing the Administration of “miscasting a budget problem in order to quickly make changes to fulfill an ideological agenda.”  The BDN then added that “doing so at the expense of the state’s most vulnerable people — without plans to help them and their families through the changes — is callous.”

Unfortunately, the effects of this budget proposal are more than callous.  They are real, harmful, and irresponsible.  Maine legislators need to respond with responsible measures to maintain the health care coverage for the 65,000 Mainers who would lose it under the Administration’s proposal.

In a 12/28/2011 editorial, the Portsmouth Herald called the Administration’s plan “unsubstantiated, unfair, unthoughtful and possibly quite costly.”

In a 12/31/2011 Bangor Daily News op ed the leaders of three of Penobscot County’s most prominent community health care organizations wrote to “urge policymakers to analyze what the impact of 65,000 newly uninsured Mainers really means to our health care infrastructure and total health care costs, and only then make truly informed decisions regarding the MaineCare program.”

Richard A. Erb, President and CEO of the Maine Health Care Association, wrote in the 1/1/2012 (Lewiston) Sun Journal that “for some 4,000 assisted living residents and their families, Gov. Paul LePage’s supplemental budget proposal to completely eliminate part of Maine’s long-term-care system is cause for grave concern this holiday season.”

In the 1/2/2012 edition of the Kennebec Journal, former director of the Consumer Health Care Division of the Maine Bureau of Insurance Alice Knapp asserts “that health care is a basic human right and that access to health care is a moral issue.”  She cites an American Journal of Public Health
study finding that “every 12 minutes an American dies from lack of health insurance as the uninsured are more likely to go without needed care.”

MECEP and our partners in the Maine Can Do Better coalition of Maine progressive advocacy groups will continue to work to block the proposed cuts and provide reasonable alternatives.   Follow this blog, and MECEP’s Facebook and Twitter postings to keep up on our efforts.

Not all jobs estimates are created equal (or deserve equal status in the eyes of policy makers and the media).  MHPC’s assertion is flawed out of the gate.  It assumes the necessity of new taxes and ignores the fact that rolling back recently enacted tax cuts would go a long way to closing the shortfall with little or no additional economic impact.  Since the tax cuts have yet to take effect, delaying their implementation or eliminating them entirely would simply preserve the status quo.

Even operating on MHPC’s unfounded assumption, how would we credibly evaluate the impacts of a tax increase?

For starters, who will the tax increase affect?  Is it rich people, poor people, or everyone across the income spectrum?  Is it businesses or individuals?  Is it a temporary tax, as was used to cover a budget shortfall during the McKernan Administration, or a permanent tax increase?

The answer to these questions has a significant impact on the outcome of the analysis.  Where taxes are concerned, not all cuts or increases are created equal.

For example, providing tax relief to low- and middle-income households generally does far more to increase economic activity than tax relief for wealthier households. Low-and middle-income households are more likely to spend their tax cuts than wealthier households that tend to put more of their money to savings.  Many nationally recognized economists such as Mark Zandi (former advisor to John McCain) and Douglas Elmendorf, Director of the Congressional Budget Officehave written about these issues and provide informative analysis of a range of policy options in supporting economic recovery and the appropriate methodology for assessing those options.

Since MHPC does not specify the kind of tax increase its analysis addresses, the results are smoke and mirrors, not substance.  A 10% surcharge on households with incomes over $250,000 would have very different economic impacts than a penny increase on the sales tax or a $1 increase in cigarette taxes for example.

CBO Analysis of Job Impacts of Various Federal Policy Proposals

MHPC further undermines the credibility of their analysis by asserting that $121 million in new taxes will actually result in $631 in lost personal income per household over the long-term.  This is quite a leap of faith predicated on a host of assumptions, none of which are made clear.  Presumably MHPC is assuming that the tax increase would be in effect in perpetuity – which likely would not be necessary since the revenue shortfall is due in large measure to a dramatic drop in revenues resulting from the recession and ill-conceived tax cuts yet to take effect that further compromise Maine’s revenue picture.

MECEP takes our commitment to provide credible research and analysis seriously.  In estimating the job losses associated with the proposed DHHS cuts, we erred on the side of caution given the lack of specific information from the Administration.  We also generated figures based on our best understanding at the time of which program areas would be impacted.   We did not make hasty assumptions about other potential job losses associated with the Administration’s proposal such as cost shifting, poorer health outcomes, and lost productivity.

With the health and well-being of tens of thousands Maine children, families, seniors, and disabled individuals at stake, it is critical that policymakers base their decisions on fact not ideology.

The (Biddeford) Journal Tribune weighed in with a 12/16/2011 editorial labeling the proposal to deny MaineCare coverage to childless healthy young adults “offensive.”  “Those ‘healthy young adults’ are some of the hardest hit by the recession, as recent college graduates are struggling to find work. The unemployment rate for those age 20-24 has hovered around 15 percent for the past few months, and for those age 25-34 the rate has been between 9-10 percent – compared with rates between 6-8 percent for those 35 and older, according to the U.S. Department of Labor.”

In a 12/18/2011 editorial entitled “Our View: Doctor LePage offers wrong cure for DHHS” the Maine Sunday Telegram (MST) issued a scathing assessment of the LePage Administration’s nearly $220 million in proposed cuts to the Department of Health and Human Services (DHHS) budget.  “If Gov. LePage were a doctor, he might be sued for malpractice: He has not only prescribed the wrong medicine for a budget shortfall in Maine’s health care safety net, he has diagnosed the wrong disease.”  And MST columnist Bill Nemitz reports on a Maine Council of Churches effort to call attention to the moral questions raised by the proposed cuts.

An editorial in this morning’s (12/19/2011) Bangor Daily News (BDN) lays responsibility for the DHHS budget shortfall squarely at the feet of the LePage Administration and suggests a political motive.  “Miscasting a budget problem in order to quickly make changes to fulfill an ideological agenda is politically disingenuous. Doing so at the expense of the state’s most vulnerable people — without plans to help them and their families through the changes — is callous.”

A rally organized by the Maine Can Do Better coalition (of which MECEP is a proud member) received extensive coverage in the Maine media, including articles and photos in the Bangor Daily News, (Lewiston) Sun Journal and Maine Today Media (Portland Press Herald, Kennebec Journal and Morning Sentinel) and reports on WABI-TV, WCSH-TV/WLBZ-TV and WGME-TV.  Maine Public Broadcasting Network ran three segments on the rally, individuals and families affected by the proposed cuts and the hearing before the Legislature’s Joint Standing Committee on Appropriations and Financial Affairs.

At the hearing, Legislators heard compelling testimony about the consequences of the proposed cuts from individuals whose benefits are at risk, from advocates for veterans, from the operators of nursing homes and other private, non-medical institutions for the elderly and from more than 100 others.

Meanwhile, at a “town hall” in Franklin County, Governor Paul LePage again justified his Administration’s proposed cuts which a Portland Press Herald editorial labeled “irresponsible, through and through.”  The Governor again cited anecdotal evidence of fraud by MaineCare recipients and discredited claims of rapid growth of the program as major contributors to the budget shortfall.  This despite the fact that Maine has one of the lowest levels of Medicaid fraud among states and that Maine’s uninsured population would go up by 50% if this proposal passes resulting in higher, not lower, medical costs for everyone.

As the Legislature moves forward with its deliberations on the Administration’s proposals, Maine people have made it clear that cutting health care benefits for tens of thousands who depend upon them is not the answer.  The question now is: are our elected representatives in Augusta listening?

That’s a lot to follow.

The real story is that according to data available from the Maine Department of Labor, Maine has lost 4,800 jobs since January 2011.  This comes at a time when the LePage Administration has proposed cutting health care for 65,000 Maine people and the loss of an additional 4,400 jobs according to MECEP analysis.

Yes, Maine’s unemployment rate has fallen from 7.6% to 7.3% since January 2011, but it is also true that, in relative terms, our performance doesn’t compare as favorably to many other states.  Of course, these numbers say very little about the number of people who are underemployed (working at jobs that pay significantly less than their skills would normally get in a period of “full employment” or working reduced hours even though they want full-time work).

How can Maine simultaneously shed jobs and see a drop in employment?  The answer – more people have left the labor force.

In January 2011, Maine had 698,834 people in the labor force compared to 694,834 in October 2011 (see Excel spreadsheet entitled Statewide 1977-2011).  Admittedly these figures are seasonally adjusted and the October figures may be revised when the November numbers are released, but based on comparable data, Maine’s labor force decline runs counter to what has occurred nationally.

At a time when an increasing number of both working and unemployed people are struggling to make ends meet, it is irrational to cut programs and services that can help them stay healthy, access child care, develop new skills, and be ready to capitalize on new opportunities when the economy starts to rebound.  This is especially true when one considers that on a dollar for dollar basis, the economic benefit of tax cuts, particularly for wealthier households, does far less to promote jobs and broadly shared prosperity than public investments in health care, child care, education, roads, and bridges.

Now is no time to cut and run on Maine people or our economy.  Instead, we must act to ensure, not imperil, current and future prosperity.  We can begin by  checking the numbers to make sure we understand the whole story.