With the impact of numerous budget cuts still being addressed and a $2 billion state budget deficit anticipated in the next fiscal year, Maryland legislators will spend more time on budget discussions than other legislative changes, including those affecting the insurance industry.

Thomas "Mac" Middleton

The implementation of universal health care in the state is in a holding pattern pending a resolution of federal health reform measures by Congress, according to State Sen. Thomas M. “Mac” Middleton (D-Charles County).

“There’s apprehension in looking at any expansion of health care as we have a $2 billion fiscal situation we’ve got to deal with so now is not the time for any kind of health care expansion when we are cutting Medicaid,” Middleton told IFAwebnews.com.

Middleton, speaking recently at a legislative summit sponsored by the Independent Insurance Agents of Maryland, said it would be “political suicide” to mention any tax increases in the immediate future. His colleague, Del. Roger A. Manno (D-Montgomery), a member of the House Economic Matters Committee, said Maryland “faces an unprecedented budget challenge.

“It’s like a sinking ship and not enough life boats,” he said.

Bills seeking funds likely ‘dead on arrival’

Brett Lininger, an associate in the lobbying and government relations division of Baltimore, Md.-based Semmes, Bowen & Semmes, who works with members of the General Assembly, put it another way.

“Obviously, any legislation with a fiscal note attached to it is pretty much dead on arrival,” he said.

Bryson Popham, a lobbyist for agents and brokers in Maryland, agreed that the budget will take center stage this session and that the state’s insurance producers “are anxiously awaiting what happens in Washington and will be ready to address any changes when and if they come to the state level.”

The “Healthy Maryland Plan” was introduced through Senate and House bills last year, proposing a new offering for the individual health market with sliding-scale subsidies for low-income individuals and coverage to every state resident despite health status or pre-existing condition. The legislation, sponsored by Middleton, chairman of the Senate Finance Committee, and Del. Peter A. Hammen (D-Baltimore City) was sent to summer study last year for refinement. The resulting legislation is being supported by Owings Mills, Md.-based CareFirst, the state’s largest health insurer.

Waiting on Congress

“It’s like spinning your wheels as you move forward not knowing what the feds are going to do, if there is going to be universal health care or not,” Middleton said. “So we’ve been waiting around and monitoring what’s going on at the federal level so if and when it is done, we are ready to go with our program in the state of Maryland.”

While “hopeful” some reform measure passes in order to control rising health care costs, the state senator said he is wary about a government-run insurance program.

“There is discussion about who sells the federal product and that scares [agents]. I understand and it should scare you,” he told agents at the IIAM event. “There are things that the federal government does well, but if you want to do it well, use the existing infrastructure. You sell the products. You work with the employer on their day-to-day needs.”

This story originally appeared in the January 2010 print edition of Insurance & Financial Advisor.