Inside Augusta

Change of Heart: Democrats Finally Cave to Mounting Pressure on Hospital Repayment



After weeks of public pressure, Democratic leaders on Monday had a change of heart: They now support repaying Maine’s $484 million hospital debt and doing so with revenues from a renegotiated liquor contract.

“Democrats have always been focused on repaying the state’s debt to the hospitals,” Senate President Justin Alfond (D-Portland) said during a morning press conference. “Today, we commit to a swift upfront and immediate payment in full to put to rest our debt obligation.”

Prior to Monday’s press conference, which came just minutes before public hearings on Gov. Paul LePage’s competing proposal began, it was unclear whether repaying the hospitals was a priority for Democrats, and Democratic leaders had insisted that any hospital repayment plan be kept separate from the liquor contract.

Fueling speculation that Democrats did not want to repay the hospitals was the emergence of a 2008 video in which Alfond said that ignoring the hospital debt might be one route to solving Maine’s budget woes. And while Democrats had not previously introduced any plan to repay the hospitals, their liquor contract bill, introduced by Senate Majority Leader Seth Goodall (D-Richmond), would have directed new revenues into the general fund rather than applying funds to the hospital debt.

Now, however, Democrats have followed the Governor’s lead and introduced a similar proposal that will prioritize hospital repayment and use funds from a retooled liquor contract – but not without a few strings attached.

According to a press release from the Senate Democratic Office, accepting federal dollars to expand Medicaid under the Affordable Care Act, also known as Obamacare, is a key component of the Democrats’ plan.

“It is encouraging to see that Democrat leadership has finally come around to realizing the importance of paying the $484 million owed to Maine’s hospitals,” said Senate Minority Leader Michael Thibodeau (R-Waldo).

“Governor Paul LePage has been working on his plan that would use liquor contract money to retire Maine’s hospital debt for six months, while the Democrats waited until a half hour before the public hearing on the bill to release their plan,” Thibodeau said.

Assistant Senate Minority Leader Roger Katz (R-Augusta) was encouraged that Democrats have finally agreed to pay the hospitals, but said their plan, in comparison to the Governor’s, will result in less money for Maine and more money for the private investors who will acquire the Maine’s liquor contract.

“Both plans call for borrowing,” said Katz. “However, the Governor’s plan has the state using its tax exempt status to borrow at rates considerably lower than those available to the private investors the Democrats apparently want to enrich.”

Katz said Democrats have introduced an “11th hour, poorly conceived scheme” to compete with the Governor’s for partisan reasons.  “It looks as though they’re against the Governor’s plan just because he’s for it,” he said.

Regarding the expansion of Medicaid, Katz said the issues ought to receive separate debates in the Legislature.

“Maybe Maine should expand Medicaid, maybe we shouldn’t. This is an extremely complicated issue, however, and needs to stand on its own as a separate bill to be considered by the Health and Human Services and Appropriations Committees on its own merits,” said Katz.

By S.E. Robinson

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About Steve Robinson

Steve Robinson is the former editor of The Maine Wire and currently the executive producer of the Kirk Minihane Show. Follow him on Twitter @BigSteve207.

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