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Harvard Pilgrim to the Rescue -- in Maine

Harvard Pilgrim to the Rescue -- in Maine

September 11, 2007

Portland Press Herald reports (click here) that Harvard Pilgrim Health Care is taking over stewardship of Maine's DirigoChoice insurance program which provides subsidized insurance coverage now to about 14,000 state residents. HPHC will take over the program from Anthem, the giant national for-profit insurer which repeatedly tussled with state policy makers over the program. HPHC currently covers about 54,000 Maine residents through conventional and self-insured products.

The Dirigo program is the centerpiece of a health reform law signed in Maine in 2003 -- lower-cost Dirigo plans are made available to eligible uninsured persons and small businesses. Original projections for Dirigo enrollment were about 130,000 by 2008; enrollment has been stuck around 14,000 for several years now.

State policy makers and advocates were rhapsodic in their praise for HPHC:

Trish Riley, director of the Governor's Office of Health Policy and Finance, noted that Harvard Pilgrim's Baker once ran the Massachusetts Department of Health and Human Services, and the company's chief operating officer oversaw that state's Medicaid program. "Part of what is attractive about Harvard Pilgrim is their understanding of the uninsured and their public mission," Riley said. ...

Baker said DirigoChoice could be financially viable without it (state subsidies). As a nonprofit, Harvard Pilgrim budgets revenue to come within 1 percent of operating margin, Baker said. Sometimes, it breaks even selling its products, and Baker expected to do the same with DirigoChoice. Anthem, in contrast, posted earnings of $10 million from DirigoChoice over the last two years.

The switch to Harvard Pilgrim was welcomed by Consumers for Affordable Health Care, a vocal supporter of DirigoChoice, which has been criticized for being too expensive and falling below enrollment projections.

Pat Berger, a member of the advocacy group and DirigoChoice subscriber, said Harvard Pilgrim is not beholden to stockholders and fits in more with Dirigo's mission, which promises coverage regardless of a member's pre-existing health conditions and treats mental health care on par with regular doctor's visits. Berger, who pays $332 a month -- a 25 percent discount -- said Anthem brokers had tried to steer her to some of their other products. "I just feel their interest was in the bottom line," said Berger who is 59 and runs a wellness center in Oakland. "Harvard Pilgrim, rather, is truly a nonprofit and I feel like there is hope for me."