Staff Writer 

Teachers who toughed out last year’s flu season and went into work sick may have helped Maine schools save hundreds of thousands of dollars for the upcoming school year. 

Anthem Blue Cross and Blue Shield, the larger of two individual health insurance providers in the state, experienced so few claims last year that the company is proposing a zero percent increase for group coverage rates – including schools – for the 2009-2010 school year, said Director of Corporate Communications Christopher Dugan. 

“If we see an increase in claims that exceeds the premium we obviously have to increase rates,” he said. “The medical and pharmacy trends were favorable last year.”

Polly Ward, Business Manager for South Portland schools, said she originally expected health insurance rates to increase 8.8 percent, more than $418,000, as they have for the past five years. Scarborough and Cape Elizabeth schools also initially budgeted for a similar increase in health rates. Both school departments have eliminated the increase from proposed budgets for next year.

“Much to our joy, rates came in at a zero percent increase,” Scarborough Superintendent David Doyle said. The 9 percent increase would have added an additional $356,000 to the school budget, he said. “I don’t ever remember [rates] being at zero.”

Last year’s trends may make the upcoming school year more affordable, but Dugan said it is important for school employees to remember to get adequate care. 

“There are lots of things that create claims,” Dugan said. “People need to get their checkups and see their doctors.”

School officials in the three towns said funds previously budgeted to cover the expected increases now will be used to decrease the tax burden for next year’s school budget. The zero percent increase in group health insurance rates may help slow the increase in residents’ property taxes. 

While Anthem’s group policy rates are expected to remain the same as last year, individual policyholders could see an 18 percent increase that Dugan said could result in Maine residents with individual policies paying hundreds of dollars more in annual premiums. He said a large number of young, healthy policyholders are allowing their coverage to expire.

“People who are younger and not incurring claims are opting out of the pool,” Dugan said. “Younger and healthier policyholders tend to absorb a lot of the risk. When you have less healthy members in the pool, rates go up.”

Unlike some states, including New Hampshire, Dugan said Maine health insurance providers cannot separate individual policyholders into groups based on  health risks, which would help prevent future increases in insurance rates. 

“Say there are people that you know their claims are going to be large,” he said. “In New Hampshire, you place those people in their own pool and the premiums are covered by policyholders and subsidized by the government. Maine doesn’t have one of those.”

Maine legislators aren’t discussing the possibility of allowing insurance providers to separate their individual policyholders based on the probability of risk. However, the Maine House of Representatives on Monday considered LD 290, a bill that would allow Maine residents to purchase health insurance from companies in Connecticut, Massachusetts, New Hampshire, Rhode Island and Vermont. Currently, Republican state Rep. Jon McKane, who represents Newcastle, said individual Mainers can only purchase insurance from one of two Maine based companies. 

“Anthem didn’t apply for monopoly status, but they surely are,” McKane said. “A little competition is just what we need.”

Dugan sponsored LD 290, a bill he said is aimed at providing more affordable options for Maine residents. If approved, Dugan said LD 290 could prevent a major change in the way Maine insurance companies do business. He said allowing residents to purchase out-of-state insurance could result in significant rate increases for Maine insurance companies, the exact opposite of what McKane had in mind.

“Out-of-state insurance companies may not be subject to the same oversight, which means the [Maine Bureau of Insurance] wouldn’t be able to give policyholders the same level of service,” he said. “Then, what if all the young and healthy people went out-of-state? It would take the ‘good risk’ out of the individual and group pool. We know the individual market needs some help, but our fear with this bill is that the same thing could happen to the small group market.”

McKane expects LD 290 and another one of his bills to reform healthcare will be defeated in what he views as partisan voting.

“There was a party line vote in the committee,” he said. “The Democrats do as they are told, that’s too bad but that’s the way it is.”

Dugan said the Maine Bureau of Insurance is currently is reviewing the proposed zero percent increase for group rates and the 18 percent increase for individuals, a process he said could take several weeks to complete.