Mainers will be paying an assessment capped at $43.7 million next year to keep the state’s Dirigo Health subsidized insurance program going in 2006.

The exact amount of what opponents are calling a hidden tax will be decided on Nov. 10 when the Dirigo Health board of directors decides how much it needs based on revised enrollment projections in the health insurance plan.

Even though enrollment projections are expected to be revised downward from the original estimate of 31,000 in 2006, Trish Riley of the governor’s Office of Health Policy and Finance said she believes somewhere in the $30 to $40 million range will be needed. The chairman of the Dirigo board has said the full amount could be charged.

The state program started insuring people this year with $53 million in one-time start-up money and currently covers 8,500 people.

The new assessment, which will be billed to private insurance companies and self-insured businesses, can be passed right along to consumers via their health insurance premiums because there’s nothing in the law to prevent it.

The attorney representing the trust that insures the state’s 70,000 teachers, retired teachers and their families – the largest group affected by the assessment – said he’s been told it will be tacked right on top of the regular premium increase.

“I honestly believe legislators thought there would be savings passed down to the payer (insurer) level and some of those savings would be used to support Dirigo,” said Attorney David Wakelin, representing the Maine Education Association Benefit Trust. Those savings have not yet trickled down, he said, so consumers will be paying for Dirigo on top of their regular rate hike.

“I don’t think the spirit of what they understood is being followed here,” he said.

The upper limit of the assessment – technically known as the savings offset payment – was decided by the state’s Bureau of Insurance after two days of public testimony on how much the Dirigo Health program has saved the state in healthcare costs. While the Dirigo Health agency had originally argued those savings were $137 million, Superintendent Alessandro Iuppa ruled they were less than a third of that based on a review of the calculations. He set savings at $43.7 million.

Iuppa attributed those savings mainly to a 3.5 percent voluntary cap on hospital expenses that was written into the legislation creating Dirigo Health in 2003. Increased Medicaid payments to doctors and more timely Medicaid payments to hospitals also were figured in the savings equation, as were reduced bad debt and charity costs due to more people being insured under Dirigo or Medicaid.

Even though the savings were less than the Dirigo Health agency had hoped, they are close to what the agency said it needs to keep running next year and equally close to what the legislation that created the assessment allows.

Under law, the assessment could not have exceeded 4 percent of claims paid by private insurance companies or the self-insured. That 4 percent is estimated to be around $48 million. The law also said the assessment could only go into effect if an equal amount of savings could be proven.

“I feel great,” Riley said Monday about Superintendent Iuppa’s ruling. While she called his savings estimate “extremely conservative…the numbers are unassailable. They’ve really been through the mill.”

The state spent an estimated $1 million to prepare its case that adequate savings had been realized to justify the assessment. The Maine State Chamber of Commerce, Anthem and others representing insurance and businesses interests in the state also spent what Riley said was likely much more to make their case that savings were only in the range of $36 million.

Kristine Ossenfort of the Maine State Chamber said, “We’re encouraged Al’s determination was more realistic, much more reasonable” than the state’s original estimate. “It’s a number that shows some real scrutiny and analysis of the proposals.”

The groups that signed on as interested parties to the hearing, including the chamber, Anthem, the Maine Association of Health Plans, and trusts representing automobile dealers and bankers, have 30 days to decide whether to appeal the insurance superintendent’s decision in court.

“We haven’t decided one way or the other,” Ossenfort said.