An Act To Make Additional Supplemental Appropriations and Allocations for the Expenditures of State Government and To Change Certain Provisions of the Law Necessary to the Proper Operations of State Government for the Fiscal Years Ending June 30, 2004 and June 30, 2005
Maine Legislature, Session 121, LD 1636
Committee: Appropriations and Financial Affairs
Sponsors: BRANNIGAN
Amends: 22 MRSA §181

12lst MAINE LEGISLATURE 
Legislative Document 
No. 1636 
H.P.1213 
House of Representatives, August 21, 2003 
An Act To Make Additional Supplemental Appropriations and 
Allocations for the Expenditures of State Government and To 
Change Certain Provisions of the Law Necessary to the Proper 
Operations of State Government for the Fiscal Years Ending June 
30, 2004 and June 30, 2005 
(EMERGENCY) 
Recei ved by the Clerk of the House on August 21, 2003. Referred to the Committee on 
Appropriations and Financial Affairs pursuant to Joint Rule 308.2 and ordered printed pursuant 
to Joint Rule 218. 
1f/~/h·17I~ 
MILLICENT M. MacFARLAND 
Clerk 
Presented by Representative BRANNIGAN of Portland. (GOVERNOR'S BILL) 
Printed on re<:ycled paper 
Emergency preamble. Whereas, Acts of the Legislature do not 
become effective until 90 days after adjournment unless enacted 
as emergencies; and 
Whereas, certain obligations and expenses incident to the 
operation of state departments and institutions will become due 
and payable immediately; and 
Whereas, in the judgment of the Legislature, these facts 
create an emergency within the meaning of the Constitution of 
Maine 
and 
require 
the 
following 
legislation 
as 
immediately 
necessary for the preservation of the public peace, health and 
safety; now, therefore, 
Be it enacted by the People of the State of Maine as follows: 
PART A 
Sec. A-I. PL 2003, c. 20, Pte FFF, §l, sub-§§l and 2 are amended to 
read: 
1. 
The 
Commissioner 
of 
Administrative 
and 
Financial 
Services, referred to in this section as "the commissioner," and 
any insurance company or 3rd-party administrator, referred to in 
this section as "the carrier," insuring or administering the 
state employee health plan, referred to in this section as "the 
plan," 
shall 
jointly 
negotiate 
agreements 
with 
hospitals 
participating in the carrier's provider network to reduce the 
expense incurred by the plan in state fiscal year 2003-04 by the 
amount of at least $18,020,851 and in state fiscal year 2004-05 
by the amount of at least $19,728,208. 
In undertaking such 
negotiations the carrier must be deemed at all times to be the 
agent of the State. 
The commissioner and the carrier acting at 
the direction of the commissioner may offer or aeRlaBa negotiate 
such terms and conditions as the commissioner considers to be in 
the best interest of the State to reduce the expense of the state 
employee health plan, including, but not limited to, offering or 
QeRlaBQiB~ 
negotiating 
reductions 
in 
standard 
hospital 
reimbursement 
rates, 
rebates 
and 
refunds 
and 
uniform 
terms 
relating 
to 
such 
reductions, 
rebates 
or 
refunds. 
The 
commissioner may not affect or seek to affect amounts paid to 
hospitals relating to any other customer of the carrier. 
2. 
The 
Commissioner 
of 
Human 
Services 
shall 
implement 
appropriate normalizing adjustments, no less than annually, to 
the public revenue component and the annual periodic interim 
payments, 
PIP, 
of 
each 
such 
hospital, 
consistent with 
the 
requirements of Title XIX of the federal Social Security ActT-~e 
e~~se~-~-~mpa€~--&~-~-plaB-£ela~eQ--~¥&&~-~~~~-QBQeF 
tBis--&ee~ieBr---~~-~-~--~-~~-a€€~~eafi€e--wita--tBis 
sw&seetieR---~--~~~--Qete~m4fieQ---~9--~--~~~~---te 
FeeewfmeRtT--~-~~~-~ha~~--FeimaaFSe-~~~&a1&-~~--a~~--saea 
FeeeapmeRt--<K>&t-s--paiEi-!>y--a:--aespital. 
In the event that federal 
financial participation is denied in any payments resulting from 
adjustments made pursuant to this subsection, the State may not 
recoup any such payments from the hospitals to which they were 
~ 
Sec. A-2. PL 2003, c. 451, Pt. Z, §1, sub-§§I, 2, 3 and 5 are amended 
to read: 
1. 
The 
Chancellor of 
the University of 
Maine 
System, 
referred 
to 
in 
this 
section 
as 
"the 
chancellor," 
and 
any 
insurance 
company 
or 
3rd-party 
administrator 
acting 
at 
the 
direction of the State, referred to in this section as "the 
carrier," 
insuring or administering the University of 
Maine 
System health plan for employees and retirees, referred to in 
this section as 
"the plan," shall negotiate agreements with 
hospitals participating in the carrier's provider network 
to 
reduce the expense incurred by the plan in st,ate fiscal year 
2003-04 by the amount of $2,250,000 and in state fiscal year 
2004-05 by the amount of $2,250,000. 
It is not the intent of the 
Legislature 
to 
require negotiations 
to 
reduce 
such expenses 
beyond state fiscal year 2005. 
In undertaking such negotiations, 
the carrier is deemed at all times to be the agent of the State 
of Maine and the University of Maine System. 
The chancellor and 
the carrier, acting at the direction of the State, may offer or 
aemaRa negotiate such terms and conditions as the chancellor 
considers to be in the best interest of the university to reduce 
the expense of the plan, including, but not limited to, offering 
or 
aemaRaiR~ 
negotiating 
reductions 
in 
standard 
hospital 
reimbursement 
rates, 
rebates 
and 
refunds 
and 
uniform 
terms 
relating to such reductions, rebates or refunds. 
The chancellor 
may not affect or seek to affect amounts paid to hospitals 
relating to any other customer of the carrier. 
The hospital 
discount rate resulting from this specific arrangement is not 
intended to affect the underlying premium rates for any purpose. 
This pooling of funds by the State is not intended to affect plan 
cost recoveries, plan cost structures or the university's ability 
to negotiate with carriers regarding the plan. 
2. 
The 
Commissioner 
of 
Human 
Services 
shall 
implement 
appropriate normalizing adjustments, no less than annually, to 
the public revenue component and the annual periodic interim 
payments of each hospital under subsection 1, consistent with the 
requirements of Title XIX of the federal Social Security Actr-te 
effset-~~-4mpa€~--9~-~-pJaR-~eJatea--~¥&&a&-~~~~-aRaeF 
tais--seetieR. 
If--aBY-~Yffi&&&-~-~~-~~~e--wi~a--tBis 
sa&SeetieR---~--~~~--aete~miRea---~--~--~~~~---te 
~eeeQpmea~T-~~~~~-saall-~ei~~~~~-aespi~al-~~-~~~-SQea 
~eeeQpmea~-ees~s-paia-9y-~ae-he6pi~alT In the event that federal 
financial participation is denied in any payments resulting from 
adjustments made pursuant to this subsection. the State may not 
recoup any such payments from the hospitals to which they were 
made. 
3. 
Any carrier subject to this section is immune from any 
claim of or liability to any enrollee, any hospital or other 
health care provider for any action taken in furtherance of the 
authority and directives as set forth in this section. 
The terms 
of this section are deemed to amend the contract between the 
carrier and the University of Maine System and prevail over any 
inconsistent terms in the contract or certificates of coyerage. 
A reimbursement 
rate, 
discount or 
rebate 
resulting 
from 
an 
agreement under subsection 1 may not be used by the carrier as a 
reference or base rate for any other contractual arrangement. 
5. 
Notwithstanding the 
prov~s~ons of the Maine Revised 
Statutes, Title 24-A, including sections 2174, 2185 and 2677-A, 
the agreement negotiated in accordance with subsection 1 may 
provide for adjustments to the amounts payable to providers on an 
aggregate services basis and on a retrospective basisT--and--sQea 
aa;Qs~mea~s-~-~~-£e~Qi£e-~-eaa~e-~~~~~~-ealeQla~ea 
eeiasQ~aaee--ameQ~~67--~~~~---~~~-~~imamsr--geae~i~ 
ai~~e~ea~ials-~-~~--geae~i~-ealeQla~iea6-~~~~~~~-se~v~ee6 
~e--~~~~-e~£ellee6-~~~Q~e~--~h&-~~-pFeviaea-~-e~ 
a~~aa~ea-9y-~~~i~~~~~~~aiae-Sy6~em. The aggregate share 
of financial responsibility contributed by employees and retirees 
for 
their 
coverage 
through coinsurance 
amounts, 
deductibles. 
lifetime 
maximums. 
benefits 
differentials 
or 
other 
benefit 
calculations may 
increape a portion of the total cost. 
The 
changes made by this subsection may not require any changes in 
the current dollar leyel of employee cost sharing under the plan 
provided by or arranged by the Uniyersity of Maine System. 
The 
chancellor shall provide notice to all such covered persons that 
the State has 
a~~aa~ea-.f~-~-~eaQe~~ea negotiated reductions in 
the cost of medical services to the University of Maine System 
aaa-~~-~-FeaQe~ieB-will-~-ge-~akeB-~~~~~~~~-~B 
and shall describe the effect on the calculation of coinsurance 
amounts, deductibles, lifetime maximums, benefit differentials or 
other 
benefit calculations 
applicable 
to 
the 
plan benefits 
provided by or arranged by the system. 
Such notice must include 
any additional disclosures necessary to fully inform such persons 
of 
the 
implications 
of 
this 
arrangement. 
It is 
not 
the 
responsibility of the carrier to provide such disclosure or 
notice. 
Sec. A-3. Retroactivity. 
Public 
Law 
2003, 
chapter 
That section of this Part that amends 
applies 
retroactively to 
July 
1, 2003 and that section of this Part that amends Public Law 
2003, chapter 451 applies retroactively to June 12, 2003. 
PARTB 
Sec. B-1. Supplemental appropriations and allocations. 
There are 
appropriated and allocated from the various funds for the fiscal 
year 
ending 
June 
30, 
2004, 
to 
the 
departments 
listed, 
the 
following sums. 
BOMAR SERVICES, DEPARTMENT OF 
Elder and Adult Services -
Bureau of 
0140 
Initiative: 
Provides for the appropriation and allocation of 
funds for Alzheimer' s respite services, homemaker services and 
the long-term care ombudsman program. 
General Fund 
All Other 
General Fund Total 
Other Special Revenue Funds 
All Other 
Other Special Revenue Funds Total 
Congregate Housing 
0211 
2003-04 
$128,915 
$128,915 
$11,700 
$11,700 
Initiative: 
Provides 
for 
the 
appropriation 
of 
funds 
for 
independent housing with services and assisted living programs. 
General Fund 
All Other 
General Fund Total 
Long Term Care -
Human Services 
0420 
2003-04 
$67,843 
$67,843 
Initiative: 
Provides 
for 
the 
appropriation 
of 
funds 
for 
long-term care assessments. 
General Fund 
All Other 
General Fund Total 
BDMAB SERVICES, DEPAR"DIERT OF 
2003-04 
$186,000 
$186,000 
DEPAJl"DIER".r 1.'OTALS 
GERERAL FORD 
07BER SPECIAL REVENUE FORDS 
DEPAJnIIERT 1.'OTAL -
ALL FORDS 
PARTC 
2003-04 
$382,758 
11,700 
$394,458 
Sec. C-l. 22 MRSA §181S, as amended by PL 2003, c. 20, Pt. K, 
§4, is further amended to read: 
§1815. 
Fees 
Each 
application 
for 
a 
license 
to 
operate 
a 
hospital, 
convalescent 
home 
or nursing 
home 
must 
be 
accompanied 
by 
a 
nonrefundable fee. 
Hospitals shall pay $1,99 $40 for each bed 
contained within the facility. 
Nursing and convalescent homes 
shall 
pay 
$49 llQ for 
each 
bed 
contained wits within the 
facility. 
Each 
application 
for 
a 
license 
to 
operate 
an 
ambulatory surgical facility must 
be 
accompanied 
by 
the 
fee 
established by the department. 
The department shall establish 
the fee for an ambulatory surgical facility, not to exceed $500, 
on the basis of a sliding scale representing size, number of 
employees and scope of operations. All licenses issued must be 
renewed annually upon payment of a like fee. The State's share of 
all fees received by the department under this chapter must be 
deposited in the General Fund. 
A license granted may not be 
assignable or transferable. 
State hospitals are not required to 
pay licensing fees. 
Sec. C-2. Federal funds to be nonlapsing. 
Notwithstanding any 
other provision of law, the carry-over balance of federal funds 
received by the Department of Humcan Services from the federal 
Department of Health and Human Services' Administration on Aging, 
as 
a 
result of the federal Older Americans 
Act of 1965 and 
granted to 
the 
Area Agencies 
on 
Aging or 
Maine 
Alzheimer's 
Project from fiscal year 2002-03, may not lapse back to the State 
but must be carried forward until September 30, 2005 by the Area 
Agencies on Aging or Maine Alzheimer's Project to carry out the 
missions of their programs. 
Sec. 
C-3 
Department 
of 
Human 
Services; 
revenue. 
Notwithstanding any other provision of law, 
the Department of 
Human Services shall deposit to the General Fund, no later than 
June 30, 
2004, undedicated revenue in the amount of $382,758, 
generated from fiscal year 2002-03 funds returned from providers. 
Sec. C-4. Retroactivity. 
That section of 
the 
Maine 
Revised Statutes, 
Title 
22, 
retroactively to July 1, 2003. 
this Part that amends 
section 
1815 
applies 
Emergency clause. 
In view of the emergency cited in the 
preamble, this Act takes effect when approved. 
SUMMARY 
PART A 
Part A corrects errors in the original language of the 
budget 
bills, 
which 
failed 
to 
specifically 
segregate 
the 
deappropriations in the state employees health insurance 
and 
university employees insurance programs from appropriations made 
to 
the 
MaineCare 
program. 
The 
appropriations 
were 
for 
the 
purpose of funding improvements in Medicaid reimbursement for 
hospital services and achieving greater parity with payments to 
providers of public employee health services. 
PART B 
Part B provides for the appropriations and allocations of 
funds to the Department of Human Services for elder and adult 
services, congregate housing and long-term care. 
PART C 
Part C lowers the license fees to operate a hospital from 
$100 to $40 for each bed and to operate a nursing or convalescent 
home 
from 
$45 to $26 
for each bed. 
Part C provides for 
a 
carry-over of federal funds from fiscal year 2002-03 to September 
30, 
2005 for use by the Area Agencies on Aging. 
Part C also 
requires that undedicated 
revenue 
returned 
from providers 
be 
deposited into the General Fund, which provides an offset to Part 
B. 
FISCAL :\OTE REQlIR(1) 
(See attached) 
Net Cost (Savings) 
General Fund 
Appropriations/Allocations 
General Fund 
Other Special Revenue Funds 
Revenue 
General Fund 
Fiscal Detail and Notes 
Approved: 08121/03 .:;:tk?ac::.. 
Office of Fiscal and Program Review 
LD xxxx 
An Act to Make Additional Supplemental Appropriations and 
Allocations for the Expenditures of State Government and to Change 
Certain Provisions of the Law Necessary to the Proper Operations of 
State Government for the Fiscal Years Ending June 30, 2004 and June 
30,2005 
LR 2199(01) 
Fiscal Note for Original Bill 
Sponsor: Rep. Brannigan 
Committee: Not Referred 
Fiscal Note Required: Yes 
Fiscal Note 
Projections 
2003-04 
2004-05 
2005-06 
$0 
$0 
$0 
$382,758 
$0 
$0 
$11,700 
$0 
$0 
$382,758 
$0 
$0 
Projections 
2006-07 
$0 
$0 
$0 
$0 
Section B-1 of the bill provides one-time fiscal year 2003-04 General Fund appropriations totaling $382,758 to the 
Bureau of Elder and Adult Services in the Department of Human Services to fund contracts affected by the loss of 
fiscal year 2002-03 carry-over balances. These one-time 2003-04 appropriations are to be offset by the recovery of 
the 2002-03 carry-over balances from the affected contractors as specified in Sec. C-3 of the bill. Section C-2 of the 
bill allows Department contractors to retain and use carry-over balances of certain federal funds that would otherwise 
be returned to the State and subsequently to the Federal government. Part A and Section C-1 of the bill have no fiscal 
impact. 
LR2199(1) - Fiscal Note - Page 1 of 1