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Press Release - Anthem Rate Increase Request Underscores Need for Reform

Location: Augusta, ME


(AUGUSTA, Maine) - September 5, 2006 - Gubernatorial candidate Senator Chandler Woodcock today called Anthem Blue Cross Blue Shield's request for a 20.5 percent increase in individual policy premiums evidence that Maine's health insurance market remains broken under Governor John Baldacci.

Senator Woodcock said that he is keenly aware of the circumstances that prompted Anthem to ask for the increase, but he also pointed out that Anthem not only writes 90 percent of the individual insurance policies in Maine, it also administers the state's Dirigo Health Plan.

"The lack of competition, coupled with Maine's regulatory environment, has created this situation," Woodcock said. "Maine's health insurance regulations limit choices and drive up costs in the individual insurance market. This rate increase request underscores this fact: Maine's health insurance market remains broken under Governor John Baldacci."

Maine is one of only a handful of states with guaranteed issue and mandated community ratings for insurance carriers. Not only does this provide little or no incentive for healthy people to buy insurance, it provides no incentive for sick people to become healthier by improving their lifestyle.

Senator Woodcock pointed out that the Legislature had an opportunity to pass a key element of insurance reform during the last legislative session - LD 1945 - but the bill was opposed by the current administration and blocked by the majority party in the Senate. LD 1945 would have established a high-risk pool, a proven method of reducing health insurance costs and reducing the number of people without health insurance in other states.

"It's been a rough couple of weeks for Mainers struggling with health insurance," Senator Woodcock said. "First, Census data tells us there were 11,000 fewer people with health insurance in 2005 than in 2004. Now Anthem is forced to ask those who do have insurance to pay even more. If this proposed rate increase, which could drive premiums as high as $2,000 a month for some families, isn't a crisis, I don't know what is."

"Under Governor John Baldacci's leadership, there are fewer Mainers with health insurance, not more; the health insurer market has gotten less competitive, not more; and, the cost of individual policies has gone up," Senator Woodcock concluded.

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