The Washington Post reports that Gov. Larry Hogan has collaborated with the General Assembly to raise taxes in order to protect Maryland’s individual insurance market:
Gov. Larry Hogan (R) and Maryland’s Democratic legislative leaders have reached agreement on a one-year plan to stabilize skyrocketing individual health insurance premiums by taxing insurance companies and using the money to pay the biggest claims.
Legislation that won initial approval in the state Senate on Friday would levy a surcharge of about $380 million on insurance companies that do business in Maryland, which are paying about that much less in federal taxes this year because of a one-time exemption provided by the recent overhaul of the U.S. tax code.
Using that money for a “reinsurance fund” will lower premiums for everyone in the individual insurance market, officials and advocates said, heading off a potential crisis stemming from anticipated increases in premiums of between 30 and 50 percent and the possible departure of CareFirst, Maryland’s only statewide insurer for the estimated 154,000 individuals who buy their own plans rather than get coverage through an employer or government program.
In this way, the Governor is working directly against efforts by Trump and congressional Republicans to kill off the Affordable Care Act through executive actions and ending the individual mandate. In short, Hogan is working with Democrats to achieve their goal of protecting health care for all Marylanders.
Of course, it’s only a stopgap solution. If reelected, Hogan will have to extend the tax increase in one form or another in order to continue the reinsurance fund, or reestablish the individual mandate within the State of Maryland. No one can seriously believe that this is a one-time move.
It’s completely the right thing to do but destroys the narrative that Hogan has reduced taxes. As the most powerful governor in the nation, Hogan could have stopped the tax increase. However, the Republican base has little choice to stick with Hogan but cannot be pleased or motivated by this decision.