Maryland’s Uninsured Trend May Be Worst in the United States

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According to newly released figures from the U.S. Census Bureau, Maryland may have the worst record in the country over the past three years when it comes to providing access to health insurance.

Although from 1996 to 1998 20 states were able to reduce their percentageof uninsured, Maryland's rate increased from 11.4 percent in 1996 to 13.4percent in 1997 to 16.6 percent in 1998. That is an increase of 5.2percent. Only two states had higher increases: Montana, with an increase of6 percent, and Nevada, with an increase of 5.6 percent. But because thosetwo states have much smaller populations and larger numbers of uninsuredpersons, their rates of increase were smaller than Maryland's. Maryland'slevel of uninsured went up 45.6 percent, while Montana's went up 44 percentand Nevada's went up 35 percent.

Many states were able to lower the number of people without healthinsurance. Arkansas did the best by lowering its percentage of uninsured bythree points, followed by Missouri and South Carolina (2.7), Nebraska(2.4), Iowa (2.3) and Tennessee (2.2).

The states that did the best are mostly midwestern and southern borderstates, so it might be tempting to dismiss them as having regionaleconomies that are different from Maryland's. But all the statesneighboring Maryland did better than it did, even though they allexperienced an increase in the number of uninsured persons: the three-yearincrease in Delaware was just 1.3 percent; in the District of Columbia, 2.2percent; in Pennsylvania, 1.0 percent; in Virginia, 1.6 percent; and inWest Virginia, 2.3 percent.

So it might be worth wondering why Maryland is different. What doesMaryland do that increases the problem of uninsured compared with itsneighboring states? Certainly one way Maryland differs is the existence ofits Health Care Access and Cost Commission, recently renamed the MarylandHealth Care Commission. The MHCC is a big bureaucracy composed of 13commissioners and a 65-person staff that regulates health care in Maryland.Among other things, the commission determines what kind of insurancecoverage small businesses in the state are allowed to buy.

For instance, the MHCC has pushed small businesses into HMOs far more thanhas been done in most of the country. Nationally, about 30 percent ofemployees are enrolled in HMOs, but in Maryland that number is abouttwo-thirds of all employees. MHCC has also virtually eliminated thepossibility of a small business in Maryland accessing a medical savingsaccount program.

If a small business in Maryland is having a tough year, it is not allowedto adjust its deductible or co-payment to lower the cost of the plan. Thebusiness may buy only the level of deductible and co-payment dictated bythe commission. The small business's only other option is to drop coveragealtogether, sending its employees into the ranks of the uninsured.The whole notion of having a government bureaucracy dictate the kind ofinsurance you may buy is offensive to most Americans. Employers who arefree to choose whether to buy insurance at all, should also be free tochoose what kind of insurance they will buy.

As important as freedom of choice may be, Marylanders might decide that thevalue of helping the uninsured is worth the sacrifice of giving up thefreedom to choose. But just the opposite has happened. Putting thecommission's bureaucrats in charge has made the problem of the uninsuredworse than ever. So, not only have Marylanders surrendered the right tochoose their own insurance, but also growing numbers are losing the abilityto have any insurance at all.

Maryland needs to look to its neighboring states or to the states that havebeen successful in increasing the numbers of insured people to learn whatto do next. Just as those states will surely be looking at Maryland to findout what not to do.

Greg Scandlen

Greg Scandlen lives in Frederick, Maryland. He is a fellow in health policy at the Cato Institute.