ANNAPOLIS – Maryland lawmakers on Wednesday proposed legislation they say would reduce the number of residents without health insurance by one-third and would provide access to health care to every child in the state. They would finance about a third of the $600 million cost of the program with a $1-a-pack increase in the cigarette tax.
Under the proposed health care plan, which has the support of the speaker of the House of Delegates, Michael E. Busch, D-Anne Arundel, an estimated 250,000 residents, which includes 110,000 children, would get subsidized Medicaid coverage. Another 30,000 children from families with incomes over 400 percent of the federal poverty level would be able to buy Medicaid coverage for what it costs the state to provide it.
“We have a crisis in the state of Maryland with 800,000 people that don’t have health insurance. … I think it’s incumbent upon every elected official to try to find a solution to it,” Busch told a press conference.
But the bill will face stiff resistance from Republicans as well as powerful Democrats such as Senate President Thomas V. Mike Miller Jr., D-Calvert and Prince George’s, who are opposed to increasing the tobacco tax to fund a health care plan.
And Gov. Martin O’Malley has previously said he is against raising the tax because it will be a declining source of revenue as more and more people quit smoking.
Sen. Minority Leader David R. Brinkley, R-Frederick, said “The cigarette tax does not get us where we need to go.” He said that the state’s comptroller is fighting a black market for cigarettes because of the regional price disparities that result from taxes.
“They’re still smoking. But they’re not paying the tax here,” he said.
The bill would extend the Maryland Child Health Insurance Program (MCHIP) to children of families of four with incomes up to $82,600, which is four times the federal poverty level. Children of families with higher income would be allowed to purchase Medicaid at market cost.
The program would also expand Medicaid coverage to individual adults with incomes up to 116 percent of the poverty level, or earning up to $11,844. This is nearly three times the current income threshold by which individuals may qualify for Medicaid.
Chief sponsor of the bill, Delegate Peter A. Hammen, D-Baltimore, said that the bill will also require those who can afford health insurance to buy it.
“We should be about the business of providing incentives for families who can afford to purchase health insurance to do just that and not burden the rest of the system,” he said.
Under the bill high income residents who do not purchase health insurance will be required to pay surcharges, ranging from $500 to $2,000 per year depending upon the income and family size.
The bill would phase in a number of other programs in 2009, including $30 million in funding for drug abuse treatment, $10 million in funding for smoking cessation and $140 million in subsidies for small businesses and individuals.
Busch said the bill would help curtail a 23 percent rise in the number of uninsured Marylanders that has taken place over the last couple of years.
Besides expanding health care, Busch said the program would reduce the health insurance premiums paid by families. He said that a family of four in Maryland pays over $1,000 on insurance premiums each year to off-set the costs of the uninsured.
Hammen said the tobacco tax is an ideal way to raise money and deter people from smoking. “If tobacco use shrinks [because of the tax], tobacco-related diseases should go down, and it should cost the system a lot less money to care for this population,” he said.