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BY SUSAN M. COVER
Staff Writer 05/06/2008

enlarge Staff photo by Andy Molloy

DIRIGO SUPPORTER: Richmond business owner Bill Keleher says he opposes the people's veto effort that's been launched by the beverage industry and others. The owner of Micro Technologies, who offers Dirigo to his employees, Keleher says it's been the only way he's been able to continue to afford to offer health insurance to his workers. Yet convenience store owners and others say they are supporting the veto because they can't afford the new taxes that would partially pay for the program.

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He and some of his 10 employees are enrolled in Dirigo Choice health insurance, which he said has helped stabilize costs for his company and his workers.

But the prospect of a people's veto that would overturn new taxes to pay for the program has him worried.

"I certainly don't want to see Dirigo go away," he said Monday from his company, Micro Technologies Inc., in Richmond. "In fact, I think it should be expanded."

Keleher, who has spoken out in recent months in support of the program, said those who use Dirigo need to get organized to keep its funding in place.

"I don't know whether the battle should be the funding formula," he said. "I'm worried about the program disappearing all together."

The other side -- Maine State Chamber of Commerce, Maine Restaurant Association, Maine Beverage Association and others -- has already begun the organizing efforts needed to gather the 55,087 signatures necessary to put the issue before voters in November.

On Friday, the group, calling itself the Fed Up With Taxes coalition, filed an application with the Secretary of State's Office to move forward with a people's veto. The secretary has 10 days to review the request and come up with language for the ballot question.

The coalition will then have until July 17 to collect the necessary signatures.

While Keleher sees the veto effort as a way to discuss the importance of Dirigo, Newell Auger, who is director of the anti-tax coalition, said the issue is not the future of the five-year-old program.

"This is about new taxes," he said.

Last month, lawmakers approved new or higher taxes on beer, wine and soda to help fund Dirigo, which currently provides insurance to about 18,000 people.

If the taxes are passed on to consumers, they would raise the cost of a liter bottle of soda by 11 cents, a 16-oz. bottle by 5 cents and a can of soda by 4 cents. For beer, a six-pack would cost 16 cents more and a standard bottle of wine would cost about 7 cents more.

The Legislature also approved a 1.8 percent tax on insurance claims.

The veto targets the taxes and the surcharge on claims. If successful, the effort would remove $56 million of the $61 million budget in 2010.

For another Dirigo member in Gardiner, having health insurance is important, but the new funding scheme is a bad idea.

Amber Hyatt, who owns Kennebec Tailoring and Mending, said she will sign the petition to repeal the taxes, even though it may jeopardize the future of Dirigo.

"It will probably pull the plug on my health care, but I do not think it's the responsibility of the public to fund this," she said.

Hyatt agreed with Keleher that the program should be expanded, and said she thinks it should be fully supported by enrollees.

Those who stand to see costs go up because of the taxes plan to play an active role in circulating petitions.

Alisa Coffin, owner of the Great Impasta in Brunswick, said she will go door to door to get signatures because she can't afford the tax increases.

In particular, she said a new tax on syrup used to make soda will cost her $60 extra a week.

That's on top of her food costs, which she said have risen 14 percent, and oil costs that are up 30 percent.

"I'm angry about this," she said. "My customers don't need to pay this."

Dirigo was created in 2003 by a state law that sought to provide health insurance to small businesses and individuals.

Before he had Dirigo, Keleher said his premiums rose 20 percent to 50 percent a year.

He said he will not sign the petition. "I feel very strongly it's worked well," he said. "It's allowed people within our company to afford health care. As a company, you want to do the right thing, but you have to look at it in the confines of what you can do and still stay competitive."

A Dirigo member who will not sign the petition is Richmond lawyer Alice Knapp, who serves on the board of Consumers for Affordable Health Care.

Knapp said she has concerns about the long-term viability of Dirigo, saying it is costly.

"My support for Dirigo will go away unless there's a meaningful effort (to reduce costs)," she said. "It is an unaffordable product for many."

Keleher said he would like to see Dirigo funded through the state General Fund but that, regardless of where the money comes from, it's time for the state and nation to find a way to get health care to those who need it.

The people's veto will now put the issue front and center.

"I hope it stimulates a wider discussion about health care and how we're going to cover people who don't have insurance," Keleher said.

Susan Cover -- 623-1056

scover@centralmaine.com

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