General Assembly approves public health care exchange

ANNAPOLIS – The General Assembly approved legislation Monday morning that would create the framework of a public health care exchange where individuals and small businesses would one day be able to compare and purchase insurance policies.

Gov. Martin O’Malley’s proposal would task an independent state agency with overseeing the exchange, which states are required to create as part of President Barack Obama’s Affordable Care Act.

Maryland’s exchange would rate health policies based on price and quality and determine which individuals and companies would receive tax credits and other subsidies. The state has received nearly $1 million in federal funds to implement the program which must be up and running by Jan. 1, 2014.

The House of Delegates approved the bill 115-22 in March. The Senate voted 33-12 to enact the measure Monday, the final day of the legislative session.

Issues still outstanding include the creation of a state-run venture capital fund, an alcohol tax hike and a financial Band-Aid for Maryland horse racing. Those and dozens of other pieces of unfinished business face a midnight deadline.

Raising the sales tax on alcohol from 6 percent to 9 percent is the most contentious piece of business legislation remaining. A pair of bills that would institute the tax hike and send $87 million in expected proceeds to mental health and education initiatives will be up for a final vote in the House of Delegates before heading to the Senate.

The Senate previously approved a three-year phase-in of the tax increase, but has not yet considered legislation that would implement the tax hike all at once. Delegates debated the plan late into Saturday night, finally giving preliminary approval at 11 p.m. over protests led by Republican lawmakers about the speed with which the bills were moving and potential impact on rural counties and businesses.

Vigorous debate on the issue is all but certain to resume Monday, after opponents bristled at moves by Democratic leaders to delay discussion of the bills, HB 1213 and SB 994.

“For all the jobs I’m going to lose in Ocean City, for all the business I’m going to lose, you can keep your money,” Del. Michael A. McDermott, R-Wicomico and Worcester, said during the debate Saturday night.

Senators will consider a set of changes to the Invest Maryland proposal. The largest would require the governor to appropriate money directly to the program if the state’s fiscal health improves later this year, and others seek to ensure rural counties are ensured a share of the investments.

Under the plan approved by the House last week, the state would auction $100 million in tax credits for as little as 70 cents on the dollar to raise at least $70 million to fuel a venture capital fund. The governor had sought $142 million in credits to raise about $100 million for the fund.

The funds raised would be used to make investments in small, high-tech Maryland companies. One-third of the money would be controlled by the Department of Business and Economic Development, which would focus its investments on entrepreneurial and early-stage companies. Two-thirds would be invested on the state’s behalf by private venture capitalists, with a focus on larger, growth-stage firms.

DBED Secretary Christian Johansson said Saturday after seeing the Senate’s proposal that he is “cautiously optimistic” about the bill’s prospects.

“The capital really plays to our strengths,” he said of the plan in HB 173. “I think it will have a significant impact on the state’s economy.”

If passed by the Senate, the House would be given the option to concur with the upper chamber’s version of the bill, or settle the differences in a conference committee.

The governor’s call to subsidize operations at the ailing horse tracks will follow the same path. The Senate Budget and Taxation Committee further limited the aid available under HB 1039 on Saturday and it will be debated on the floor Monday.

Under the committee’s amended legislation, the Maryland Jockey Club, which owns Pimlico Race Course and Laurel Park, would have to reach a deal by July 1 to simulcast races with Rosecroft Raceway to be eligible for up to $6 million in operating subsidies in 2012.

And to qualify for another year of state assistance, the club would have to craft with horse breeders and owners a sustainable plan for the future of the industry that lawmakers find acceptable. That plan would be due Dec. 1, 2011.

O’Malley’s original proposal called for an uncapped subsidy for the jockey club from 2012 through 2014. The House capped the subsidy at $6 million and limited it to two years.

“It makes sure we have racing this year and next year, and gives everybody time to come up with a plan that works for them,” said Joseph C. Bryce, O’Malley’s chief legislative officer.

One comment

  1. For small businesses, it is still too soon to tell if this will result in positive or negative to the business itself. We believe that small businesses will have additional burden of dealing with additional regulations, but may give up altogether on dealing with Health Insurance – the exchanges will take ’em all.
    This insecurity also paves the way for the PEO industry to help each small business find their way through this mess!
    Anthony Kelly PEOcompare.com

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