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Medicaid, SCHIP, & Federal Authority

  • HIFA Waiver – In 2002, Maine received approval from the Centers for Medicare and Medicaid Services (CMS) for a Health Insurance Flexibility and Accountability (HIFA) waiver to expand health insurance coverage to childless adults with incomes at or below 125 percent of the federal poverty level (FPL). To fund the coverage initiative, Maine redirects a portion of its disproportionate share hospital allocation to cover this population. Coverage was to be expanded in 2 phases, with the first covering childless adults with incomes at or below 100 percent of the FPL and the second covering childless adults up to 125 percent of the FPL as part of the Dirigo Health Reform initiative. The second phase was never implemented as the program had reached its budget neutrality cap. The expansion was later repealed by the Maine legislature, and CMS removed the state’s authority to cover childless adults with incomes between 101 and 125 percent of the FPL. This waiver was renewed for an additional three years in 2007.

    The Deficit Reduction Act of 2005 (DRA) - In January 2008, Maine received approval from CMS to implement a DRA cost-sharing state plan amendment, allowing the state to charge premiums for the Katie Beckett population. (The Katie Beckett population are children who can qualify for Medicaid even though their family has an income above the allowable limit. This eligibility is based on the fact that their medical condition would make them eligible for hospital or skilled nursing facility care.) Premiums, ranging from .005 to 2.5 percent of gross income, will be imposed on families with incomes exceeding 150 percent of the FPL. The state will determine monthly premiums with a sliding fee schedule based on income.


Dependent Coverage

  • L.D. 841 requires individual and group health insurance policies to continue health coverage young adults up to the age of 25 as long as they are financially dependent and have no dependents of their own.


State Specific Strategies

  • Dirigo Health Reform Act – This comprehensive state-wide health system reform, enacted in 2003, addresses costs, quality, and access to health care with the goal of establishing universal coverage within six years.  The Act includes a number of cost-containment initiatives, including system-wide health planning, public price disclosure, simplification of administrative functions and reductions in paperwork, and voluntary limits on hospital costs and new rate regulation on insurance premiums.  

    The Act creates the Maine Quality Forum, which promotes quality of care initiatives and educates providers and consumers about medical practices and other quality of care indicators. The Act created DirigoChoice,which isan affordable health insurance option for small businesses, the self-employed, and eligible individuals without access to employer-sponsored insurance that offers discounts on monthly payments and reductions in deductible and out-of-pocket costs on a sliding scale to enrollees with incomes below 300 percent FPL.  

    Funding for DirigoChoice comes from a variety of funding streams: employer contributions, individual contributions, a one time appropriation of state general funds, federal Medicaid matching funds for those individuals who are eligible andthrough the “savings offset payment” which is generated through the recovery of bad debt and charity care and other savings targets set by the state. 
    To learn more about the Maine’s Dirigo program, read SCI’s Profile in Coverage.