An Act To Modify the Savings Offset Payment for Plan Year 2006 and To Establish the Blue Ribbon Commission on the Long-term Funding of the Dirigo Health Program and To Increase Access to Heal th Insurance Products Further amend the amendment by adding after Part B the following: PARTC Sec. C-l. 22 MRSA §3174-DD, as amended by PL 2005, c. 400, Pt. C, §2, is further amended to read: §3174-DD. Dirigo health coverage The department may contract with one or more heal th insurance carriers or the Dirigo Health Self-administered Plan established pursuant to Title 24-A, section 6981 to purchase Dirigo Health Program coverage for MaineCare members who seek to enroll through their employers pursuant to Title 24-A, section 6910, subsection 4, paragraph B. A MaineCare member who enrolls in the Dirigo Health Program as a member of· an employer group receives full MaineCare benefits through the Dirigo Health Program. The benefits are delivered through the employer-based health plan, subject to nominal cost sharing as permitted by 42 United States Code, Section 13960(2003) and additional coverage provided under contract by the department. Page l-LR2809(21) SENATE AMENDMENT
Maine Legislature, Session 122, LD 1935
Committee Amendment CA_A-SA_A_S698 (Senate)
Amends: 22 MRSA §3174-D, 24-A MRSA §6903, 24-A MRSA §6904, 24-A MRSA §690, 24-A MRSA §6908, 24-A MRSA §6909, 24-A MRSA §6910, 24-A MRSA §6916

SENATE 
AMENDMENT "A" to COMMITTEE 
AMENDMENT 
"A" to S.P. 
736, 
L.D. 
1935, 
Bill, 
"An 
Act 
To 
Protect Health 
Insurance. 
Consumers" 
Amend the amendment by striking out the substitute title and 
replacing it with the following: 
'An Act To Modify the Savings Offset Payment for Plan Year 2006 
and To Establish the Blue Ribbon Commission on the Long-term 
Funding of the Dirigo Health Program and To Increase Access to 
Heal th Insurance Products' 
Further amend the amendment by adding after Part B the 
following: 
'PARTC 
Sec. C-l. 22 MRSA §3174-DD, as amended by PL 2005, c. 400, 
Pt. C, §2, is further amended to read: 
§3174-DD. 
Dirigo health coverage 
The 
department 
may 
contract 
with 
one 
or 
more 
heal th 
insurance carriers or the Dirigo Health Self-administered Plan 
established pursuant to Title 24-A, 
section 6981 to purchase 
Dirigo Health Program coverage for MaineCare members who seek to 
enroll through their employers pursuant to Title 24-A, section 
6910, subsection 4, paragraph B. 
A MaineCare member who enrolls 
in the Dirigo Health Program as a member of· an employer group 
receives 
full 
MaineCare 
benefits 
through 
the 
Dirigo 
Health 
Program. 
The benefits are delivered through the employer-based 
health plan, subject to nominal cost sharing as permitted by 42 
United States Code, Section 13960(2003) and additional coverage 
provided under contract by the department. 
Page l-LR2809(21) 
SENATE AMENDMENT 
.. 
,,~ 
SENATE 
AMENDMENT "A" to COMMITTEE 
AMENDMENT 
"A" to S . P . 
L.D. 1935 
736, 
Sec. C-2. 24-A MRSA §6903, sub-§l, as enacted by PL 2003, c. 
469, Pt. A, §8, is amended to read: 
1. Board. "Board" means the Board of :9:i:!?eel;e!?s Trustees of 
Dirigo Health, as established in section 6904. 
Sec. C-3. 24-A MRSA §6904, as enacted by PL 2003, c. 469, 
Pt. A, §8, is amended to read: 
§6904. 
Board of Trustees of Dirigo Hea1th 
Dirigo Health operates 
Board of 
:9:i:!?eel;e!?s 
Trustees 
accordance with this section. 
under the supervision of --a-
of Dirigo Health established 
the 
in 
1. 
Appointments. 
The 
board consists 
of --9-
~ voting 
members and -6-
~ ex officio, nonvoting members as follows. 
A. 
The -e-
~ voting members of the board must be appointed 
by the Governor, subject to review by the joint standing 
committee of the Legislature having jurisdiction over health 
insurance matters and confirmation by the Senate. 
B. 
The -6-
~ ex officio, nonvoting members of the board are: 
(1) 
The 
Commissioner 
of 
Professional 
and 
Financial 
Regulation or the commissioner's designee; 
(2) 
The director of the Governor's Office of Health 
Policy and Finance or the director of 
a 
successor 
agency; aREl 
(3) 
The Commissioner of Administrative and Financial 
Services or the commissioner's designeeT; and 
(4) 
The Treasurer of State or the treasurer's designee. 
~T--Qaa~i~iea~ieBs-e~-¥e~iB9-mem&e~ST--¥~~~~~~~-l;he 
sea!?El ... 
AT--M¥fi€-~~~~~-aR4-eHpe~:i:eRee-~£-~~-~~-eE 
I;he-~e**ew:i:RIJ-a~eas ... 
SENATE AMENDMENT 
SENATE AMENDMENT 
.. A.. to COMMITTEE 
AMENDMENT 
"A" to S . P . 
736, 
L.D. 1935 
tl*---A--FepFeseB~a~ive--e~--empleyee--e~--aB--iB6aFaBee 
ea~Fie~-aa~ae~iBee-~e-ee-9asiBess-iB-~ais-S~a~et 
t6*--~-~~~~~-~--empleyee-~~-~-head~£--eaFe 
pFevieeF-epe~a~iB§-iB-ERis-S~a~eT-eF 
t~*--~~~~~~--~~~--a--~~~--~---aeal~R-FelaEee 
eF§aBiBaEieB-~e§alaEee-9y-SEaEe-GeveFBmeB~T 
A-~~~~~~~~~~-eaFe-p~~€~4~4eRe~7-~~~~~~~-EeFmeF 
aealEa-ea~e-~Qm4R4~~~~~e~-~-~~~~~~--~~~~ye&-ef-a 
aealER--4R~~~~Ree--~~~~~--~~-~-~~~~&&G--fFeffi--geiB§ 
eeBsiQe~ee-~~--&&a~-~~~~~&-~eR~-~-~aaE-~~-is 
Be~-~~~~~-~~~~~~~-w4~a--a-~~~-~--Real~R-Fela~ee 
e~§aBiBa~ieBT 
2-A. 
Om,lifications of voting members. 
Voting members of 
the board must be gualified in accordance with this subsection. 
A. 
Six of the voting members 
of 
the 
board must 
have 
knowledge of and experience in one or more of the following 
areas: 
(1) 
Health care purchasing; 
(2) 
Health insurance; 
(3) 
MaineCare: 
(4) 
Health policy and law; 
(5) 
State management and budget; 
(6) 
Health care financing; 
(7) 
Labor or consumer advocacy: and 
(8) 
Marketing. 
B. 
Three of the voting members of the board must have 
knowledge of and experience in one or more of the following 
areas: 
SENATE AMENDMENT 
SENATE AMENDMENT 
L.D. 1935 
to COMMITTEE 
AMENDMENT "A" 
(1) Accounting; 
( 2) Banking; 
(3) Securities: and 
(4 ) In!iil.lrance • 
to S.P. 736, 
C. 
Except as provided in this Paragraph, a voting member of 
the board maY not be: 
(I) A representative or employee of a health insurance 
carrier authorized to do business in this State; 
(2) 
A representative or employee of 
a 
health care 
provider operating in this State; 
(3) 
Affiliated 
with 
a 
health 
or 
health-related 
organization regulated by State Government; or 
(4) A representative or employee of Dirigo Health. 
A nonpracticing health Care practitioner« retired or former 
health Care administrator or retired or former employee of a 
health 
insurance 
carrier is 
not 
prohibited 
from 
being 
considered for bOard membership as long as that person is 
not currently affiliated with a health or health-related 
organization. 
3. 
Terms of office. 
Voting members serve 3-year terms. 
Voting members may serve up to 
consecutive terms. 
Of the 
initial appointees, 
one member serves an initial term of one 
year, 
members serve initial terms of 2 years and 2 members 
serve initial terms of 3 years. 
The Governor shall fill any 
vacancy for an unexpired term in accordance with subsections 1 
and 2. 
Members reaching the end of their terms may serve until 
replacements are named. 
4. 
Chair. 
The Governor shall appoint one of the voting 
members as the chair of the board. 
5. 
Quormn. 
~hree Five 
voting 
members 
of 
the 
board 
constitute a quorum. 
6. 
Affirmative vote. 
An affirmative vote of -J-
~ members 
is required for any action taken by the board. 
1. 
Compensation. 
A member of the board must be compensated 
according 
to 
the 
provisions 
of 
Title 
5, 
section 
l2004-G, 
SENATE AMENDMENT 
SENATE AMENDMENT 
L.D. 1935 
COMMITTEE 
AMENDMENT "A" to S . P . 
736, 
subsection l4-D; a member must receive compensation whenever that 
member fulfills any board duties in accordance with board bylaws. 
8. 
Meetings. 
The board shall meet a~-~€a£~-~~~-a-yeat 
a~-£e~Q~at-4~~e£va~s monthly and may also meet at other times at 
the call of the chair or the executive director. 
All meetings of 
the board are public proceedings within the meaning of Title l, 
chapter 13, subchapter 1. 
Sec. C-4. 24-A MRSA §690S, as enacted by PL 2003, c. 469, 
Pt. A, §8, is repealed and the following enacted in its place: 
§6905. 
Limitation on liability 
1. Indemnification of Dirigo Health employees. 
An employee, 
of Dirigo Health is not subject to any personal liability for 
having acted within 
the 
course 
and 
scope 
of 
membership 
or 
employment to carry out any power or duty under this chapter. 
Dirigo Health shall indemnify any member of the board and any 
employee 
of 
Dirigo 
Health 
against 
expenses 
actually 
and 
necessarily incurred by that member or employee in connection 
with the defense of any action or proceeding in which that member 
or employee is made 
a 
party by 
reason of past or present 
authority with Dirigo Health. 
2. Limitation on liability of board members. 
The personal 
liability of a member of the board is governed by Title l8-B, 
section 1010. 
Sec. C-S. 24-A MRSA §6908, sub-§2, 1fE, as amended by PL 2005, 
c. 400, Pt. c, §6, is further amended to read: 
E. 
Arrange the provision of Dirigo Health Program benefit 
coverage 
to eligible 
individuals 
and eligible employees 
through contracts with one or more qualified bidders in 
accordance 
with 
section 
6910 
or 
through 
the 
self-administered plan authorized pursuant to section 6981; 
Sec. C-6. 24-A MRSA §6909, sub-§2, 1fA, as enacted by PL 2003, 
c. 469, Pt. A, §8, is amended to read: 
A. 
Serve as the liaison between the board 9{-a4£e€£9tS and 
Dirigo Health and serve as secretary and treasurer to the 
board; 
Sec. C-7. 24-A MRSA §6910, sub-§l, as amended by PL 2005, c. 
400, Pt. c, §8, is further amended to read: 
1. 
Dirigo Health Program. 
Dirigo Health shall arrange for 
the provision of health benefits coverage through the Dirigo 
SENATE AMENDMENT 
SENATE 
AMENDMENT "A" to COMMITTEE 
AMENDMENT 
"A" to s. P. 
L.D. 1935 
736, 
Health Program not later than October 1, 2004. 
The Dirigo Health 
Program 
must 
comply with all 
relevant 
requirements 
of this 
Title. 
Dirigo Health Program coverage may be offered by health 
insurance 
carriers 
that 
apply 
to 
the 
board 
and 
meet 
qualifications described in this 
section 
and 
any 
additional 
qualifications set by the board or may be provided through the 
Dirigo Health Self-administered Plan pursuant to section 6981. 
Sec. e-8. 24-A MRSA §6916 is enacted to read: 
S6916. 
Marketing and sale of Dirigo Health Program: 
qyalifications of insurance producers 
1. 
Qualifications of insurance 
producers. 
An 
insurance 
producer licensed pursuant to chapter 16 may solicit. negotiate, 
and sell insurance products offered by or through the Dirigo 
Health Program if the following conditions are met prior to any 
such solicitation, negotiation or sale: 
A. 
The producer is authorized by the superintendent to 
solicit, 
negotiate 
and sell 
insurance 
products 
for 
the 
health line of business: 
B. 
The 
producer has 
successfully completed all training 
offered and reguired by the Dirigo Health Program for the 
solicitation, negotiation and sale of Dirigo Health Program 
insurance 
products, 
including 
any 
continuing 
training 
offered and reguired by the Dirigo Health Program; 
C. 
The producer provides the carrier or carriers with which 
the Dirigo Health Program has contracted to underwrite and 
provide Dirigo Health Program coverage a current certificate 
from the Dirigo Health Program certifying the successful 
completion of all training offered and required by 
the 
Dirigo Health Program; and 
D. The producer successfully completes all training specific 
to the sale of Dirigo Health Program insurance products 
offered and reguired by the carrier or carriers contracting 
with the Dirigo Health Program to underwrite and provide 
Dirigo Health Program coverage, 
including any continuing 
training offered and reguired by such carrier or carriers. 
2. 
Annual 
certification required. 
Training pursuant to 
subsection 1 must be completed annually, 
and any certificate 
establishing successful completion of training is valid for one 
year from the date of issuance. 
If a producer fails to obtain 
certification 
following 
the 
expiration 
of 
the 
prior 
year's 
certification, 
the 
producer 
may 
not 
continue 
to 
solicit. 
SENATE AMENDMENT 
SENATE AMENDMENT 
.. /+. to COMMITTEE 
AMENDMENT "A" to S • P • 
, 
L.D. 1935 
negotiate and sell insurance products offered by or through the 
Dirigo Health Program. 
3. 
Carrier appointment not required. 
Notwithstanding any 
other provision of law, an insurance producer licensed pursuant 
to 
chapter 
who 
complies 
with this 
section may 
solicit, 
negotiate and sell insurance products offered by or through the 
Dirigo Health Program without being appointed by the carrier or 
carriers contracting with the Dirigo Health Program to underwrite 
and provide Dirigo Health Program coverage. 
A producer may not 
solicit, negotiate or sell insurance products offered by or 
through the Dirigo Health Program if the producer is not in 
compliance with this subsection. 
Notwithstanding section 1445, 
the carrier or 
carriers contracting with the 
Dirigo 
Health 
Program to underwrite and provide Dirigo Health Program coverage, 
are not liable for the actions of an insurance producer who has 
not been appointed to solicit, 
negotiate 
and sell insurance 
products offered by or through the Dirigo Health Program. 
Sec. C-9. 24-A MRSA c. 87, sub-c. 4 is enacted to read: 
SUBCBAPTER 4 
DIRIGO REALm SELF -ADMINISTERED PLAN 
§6981. 
Dirigo Health Self-administered Plan 
Notwithstanding section 6910, 
subsection 2, 
Dir igo Health 
may provide access to health benefits coverage by establishing 
the Dirigo Health Self-administered Plan, referred to in this 
section as "the self-administered plan," pursuant to this section. 
1. 
Establishment. 
Dirigo Health 
may 
provide 
access 
to 
health 
benefits 
coverage 
through 
the 
Dirigo 
Health 
Self-administered 
Plan 
subject 
to 
the 
requirements 
of 
this 
section. 
The board may make a determination that Dirigo Health 
will 
provide 
access 
to 
health benefits 
coverage 
through 
a 
self-administered plan after the board evaluates competitive bids 
for health benefits 
coverage for self-administered and fully 
underwritten health benefits coverage. 
If the board determines 
that Dirigo Health will provide access to health coverage through 
a self-administered plan as authorized under this section, the 
board shall submit 
a 
report explaining the 
reasons 
for 
the 
decision to the 
joint standing committee of the Legislature 
having jurisdiction over health insurance matters within 30 days 
of the decision. 
Upon receipt of a report from the board, the 
chairs of the joint standing committee of the Legislature having 
jurisdiction over health insurance matters may call a meeting of 
the committee. 
Following receipt of such a report, the joint 
standing committee of the Legislature having jurisdiction over 
SENATE AMENDMENT 
\\",,, 
SENATE 
AMENDMENT "A" to COMMITTEE 
AMENDMENT 
"A" to S.P. 
L.D. 1935 
736, 
heal th insurance matters may report out legislation to the next 
regular or special session of the Legislature relating to the 
establishment of the Dirigo Health Self-administered Plan. 
2. 
COOj?erative agreements. 
Dirigo Health may enter into 
voluntary cooperative agreements with 
a 
public purchaser for 
purchasing 
purposes 
and 
administrative 
functions. 
If 
a 
cooperative 
agreement 
is 
entered 
into 
pursuant 
to 
this 
subsection, the self-administered plan and any public purchaser 
shall maintain separate and distinct risk pools and reserves and 
may 
not 
commingle 
risk 
pools 
or 
reserve 
funds 
under 
any 
circumstances. 
For 
the 
purposes 
of 
this 
subsection, 
"public 
purchaser" means an entity that purchases health coverage in 
whole or in part with public funds, including, but not limited 
to, the state employee health insurance program, the University. 
of Maine System, the Maine Community College System, the Maine 
Education Association benefits trust, the Maine School Management 
Association benefits trust and municipal and county governments. 
For the purposes of this subsection, "public purchaser" does not 
mean the Department of Health and Human Services, Office of 
MaineCare Services 
except for cooperative agreements for the 
purchasing of pharmaceuticals pursuant to Title 5, section 2031. 
3. Additional responsibilities of board. 
In addition to 
the duties and responsibilities set out in sections 6908 and 
6910, the board is authorized to: 
A. 
Operate the self-administered plan pursuant to a trust 
instrument in accordance with Title l8-B: 
B. 
Develop, maintain and modify a business plan for the 
self-administered plan as appropriate in consultation with 
the executive director; 
C. 
Establish an operating budget for the self-administered 
plan subject to legislative approval in the biennial budget 
process in accordance with section 6908, subsection 3; 
D. 
Ensure the ongoing fiscal integrity and stability of the 
self-administered plan in accordance with subsections 5 and 
and monitor statistics provided by the executive director 
relating to the number of plan enrollees, working rates, 
utilization of benefits, operating costs and reimbursement 
for losses related to excess or stop loss coverage; 
E. 
Establish administrative and accounting procedures in 
accordance with section 6908, subsection 2, paragraph A and 
develop 
financial 
statements 
that 
are 
consistent 
with 
generally accepted accounting principles; 
SENATE AMENDMENT 
(\~~. 
SENATE 
AMENDMENT "A" to COMMITTEE 
AMENDMENT "A" to S . P . 
, 
L.D. 1935 
F. 
Obtain necessary contracts for services, including, but 
not limited to, 
actuarial services, 
accounting services, 
auditing 
services, 
investment 
advice 
and 
counsel 
and 
custodial services for financial assets in accordance with 
subsection 4: 
G. 
Take any actions necessary to comply with federal and 
state Medicaid rules regarding Dirigo Health plan enrollees 
members eligible for MaineCare: 
H. 
Take 
any 
actions 
necessary to 
comply with federal 
Medicaid managed care organization contract requirements as 
provided in 42 Code of Federal Regulations, Part 438 (2002); 
and 
I. 
Have and exercise all powers necessary and appropriate 
to carry out the purposes of this section. 
4. 
$ervices. 
If the board determines that Dirigo Health 
will 
provide 
access 
to 
health 
coverage 
through 
the 
self-administered plan pursuant to subsection 2, the board shall 
contract for the following services through a competitive bidding 
process unless the requirement for competitive bidding is waived 
pursuant to Title 5 ( section 1825 B ( subsection 2 or a carrier 
contracted by Dirigo Health to fully underwrite health benefits 
coverage terminates that contract. 
A. 
The board shall secure the services of an actuary for 
technical advice on matters regarding the operation of the 
self-administered plan in accordance with this paragraph. 
The board shall contract for actuarial services after a 
competitive bidding process at least every 3 years and may 
award a bid only to an actuary who is a member in good 
standing of the American Academy of Actuaries or a successor 
organization. 
The contract must require the actuary to: 
(1) Act as a technical advisor to the board on matters 
regarding the operation of the self-administered plan 
in accordance with this paragraph: 
(2) 
Certify the 
amounts 
of 
the benefits 
paid 
and 
payable under this section: 
( 3) Analyze the year' s operations and results and the 
experience of the self-administered plan: 
(4) 
Determine 
appropriate 
actuarial 
assumptions 
for 
recommendation to the board: and 
SENATE AMENDMENT 
"tl',~ 
~ ,-
SENATE 
AMENDMENT 
L.D. 1935 
to COMMITTEE 
AMENDMENT 
"A" to S . P . 736, 
(5) Determine the appropriate level of reserves needed 
to sustain the self-administered plan and pay benefits. 
B. 
Thg board shall secure the servicgs of one or more 
fiduciaries 
or 
registered 
investmgnt 
advisors 
through 
nggotiatgd 
contractual 
arrangements. 
The 
contract 
must 
reguirg the fiduciary or registered investment advisor to: 
(1) 
Invest and reinvest the funds in accordance with 
appropriate financial and trust standards: 
(2) 
Advise 
the 
board 
as 
to 
reasonable 
investment 
philosophy: and 
(3) 
Submit regular rgports of investments and changes. 
to the board. 
C. 
Thg board shall contract with an appropriate financial 
institution for custodial seryicgs for the securities and 
othgr invgstment assgts of the self-administered plan. 
The 
contract 
must 
rgguire 
thg 
custodian 
to 
meet 
financial 
safgguards and other gualifications determingd by the board, 
including restrictions on thg manner in which deposits and 
withdrawals of funds arg completed. 
D. 
Whgn 
the self-administered plan is established, 
the 
board shall purchasg, 
through contracts from one or more 
3rd-party administrators or any organization necessary to 
admini§tgr and provide a health plan, a policy or policies 
or a 
contract to provide the bengfits spgcified by this 
sgction. 
Thg purchase of policies by the board must be 
accompli§hed by 
u§g 
of 
a 
written contract 
for 
a 
term 
detgrmingd by thg board. 
The 
board 
may 
contract 
for 
any 
other 
applicable 
services 
neces§ary to comply with fgdgral law. 
5. 
Agministration. 
The 
following 
provisions 
govern 
the 
administration of the self-administgrgd plan. 
A. 
The assets and liabilities of the self-administered plan 
arg solgly the assgts and liabilities of Dirigo Health. 
B. 
Thg actuary undgr contract with the board pursuant to 
subsgction 4 shall dgtermine: 
(1) The appropriate levgl of reserves estimated to be 
sufficient 
to 
pay' claims 
and 
administrative 
costs 
according to subsection 10, paragraph Bj 
SENATE AMENDMENT 
;~~~ 
.. 
1> 
SENATE 
AMENDMENT 'A" to COMMITTEE 
AMENDMENT "A" to s. P. 
736, 
L.D. 1935 
(2) Whether the program is operating on an actuarially 
sound basis, 
and any 
recommendations based on that 
determination: 
(3) A rate structure for the self-administered plan, 
including working rates actuarially sufficient to pay 
anticipated claims for the current claims year as well 
as to provide sufficient reserves for incurred but not 
reported claims: 
( 4) 
R~commendations as to the purchase of excess or 
stop 
loss 
insurance 
including 
suggested 
attachment 
levels and limits: and 
(5) 
Recommendations 
as to the need for 
a 
security. 
deposit or surety bond to protect against insolvency. 
The actuary shall annually present information to the board 
on the determinations made pursuant to this paragraph as 
well as the method of distribution of any accumulations 
above 
the reserves including use of excess reserves 
to 
moderate the working rates. 
C. 
Upon 
receipt 
of 
the 
initial 
presentation 
and 
recommendations of the actuary pursuant to paragraph Band 
annually 
th~reafter, 
the 
board 
shall 
submit 
that 
presentation 
to 
the 
superintendent 
for 
review. 
The 
superintendent shall review the actuary's presentation and 
provide comments to the board. 
6. Audits: financial statements. 
The board shall arrange 
for an annual audit of its financial statements by an independent 
certified 
public 
accounting 
firm. 
Within 
days 
of 
the 
completion 
of 
the 
audit, 
a 
copy 
of 
the 
audited 
financial 
statements must be distributed to the Legislature in the same 
manner as required by section 6908, subsection 4. A copy of the 
audited financial statements must also be made available for 
public inspection. 
7. Public entity. The Dirigo Health Self-administered Plan 
is a 
public entity for the purposes of 42 
Code of Federal 
Regulations, Section 438.116. 
8. 
Applicilt,ion 
of 
certain 
insurance 
provisions. 
The 
self-administered 
plan 
must 
meet 
or 
exceed 
the 
following 
requirements as if health benefits coverage were provided by a 
health insurance carrier: 
Page ll-LR2809(21) 
SENATE AMENDMENT 
t~~~e 
SENATE AMENDMENT "A" to COMMITTEE 
AMENDMENT "A" to S . P . 
L.D. 1935 
736, 
A. 
The 
requirements 
for 
ratings 
practices 
pursuant 
to 
section 2736 C, subsection 2 and section 2808 B, subsection 
£L 
B. 
The 
requirements 
for guaranteed issuance pursuant to 
section 2736-C, subsection 3 and section 2808-B, subsection 
II 
C. 
The 
requirements 
for 
guaranteed 
renewal 
pursuant to 
section 2736-C, subsection 3 and section 2808-B, subsection 
subject to the limitations of available funds maintained 
by the self-aQIDinistered plan in accordance with subsection 
l.Q..L 
D. The requirements for continuity of coverage, coverage of, 
late enrollees and preexisting condition exclusions pursuant 
to chapter 36; 
E. The requirements for mandated coverage of specific health 
care services and for specific diseases and for certain 
providers of health care services pursuant to Title 24 and 
this Title; and 
F. The requirements for the benefits, rights and protections 
for individuals enrolled in health plans pursuant to chapter 
56-A 
and 
Bureau 
of 
Insurance 
Rule, 
Chapter 
850. 
Notwithstanding any statute or common law to the contrary, 
an individual enrolled in the self-administered plan may 
maintain a cause of action against the self-administered 
plan subject to the 
requirements of section 4313. 
This 
paragraph is a waiver of the State' s defense of immunity 
under Title 14, chapter 741. 
The self administered plan may not enter into any contract with a 
3rd-party 
administrator, 
carrier 
or 
other 
organization 
to 
administer and provide health coverage that has not demonstrated 
compliance with all applicable state laws. 
9. 
Dirigo Health Se1.f api nistered P1.an not an insurer. 
The Dirigo Health Self-administered Plan is not 
an 
insurer, 
reciprocal insurer or joint underwriting association under the 
laws of the State. 
The administration of the self-administered 
plan by the board does not constitute doing the business of 
insurance. 
1.0. 
Reserves. 
This subsection applies to reserves of the 
self-administered plan. 
A. 
The Dirigo Health Reserve is created as 
an account 
within the Dirigo Health Enterprise Fund, 
as established 
SENATE AMENDMENT 
~~s' 
, , 
SENATE AMENDMENT "4 .. to COMMITTEE 
AMENDMENT "A" to S.P. 736, 
L.D. 1935 
pursuant to section 6915, for the deposit of reserves as 
required by paragraph B. 
B. 
The self-administered plan shall maintain a reserve at 
least equal to the sum of: 
(1) An amount estimated by a qualified actuary under 
subsection 
to 
be 
necessary 
to 
pay 
claims 
and 
administrative costs for the assumed risk for 
months; and 
(2) 
The 
amount 
determined 
annually 
by 
a 
qualified 
actuary under subsection 5 to be necessary to fund the 
unpaid portion of ultimate expected losses. including 
incurred but not reported claims. and related expenses 
incurred in the 
prov~s~on of benefits for eligible 
participants. 
less 
any credit. 
as 
determined 
by 
a 
qualified actuary. for excess or stop loss insurance. 
c. 
The 
Dirigo 
Health 
Reserve 
must 
be 
adjusted 
on 
a 
quarterly basis in order to maintain a reserve at least 
equal to the amount determined in paragraph B. 
D. 
The Dirigo Health Reserve is capitalized by money from 
the Dirigo Health Enterprise Fund. as established pursuant 
to section 6915. and any other 
fund advanced for initial 
operating expenses. 
monthly enrollee payments. 
any funds 
received from 
any public or private source, 
legislative 
appropriations. payments from state departments and agencies 
and such other means as the Legislature may approve. 
All 
money in the Dirigo Health Reserve is deemed to be the 
commingled assets of all covered enrollees and may be used 
only for the purposes of this section. 
11. Stgp loss insurance. 
The board may purchase excess or 
stop 
loss 
insurance 
for 
the 
self-administered 
plan, 
with 
attachment 
levels 
and limits 
as 
recommended 
by 
a 
qualified 
actuary pursuant to subsection 5. 
If the board is unable to 
purchase 
excess 
or 
stop 
loss 
insurance 
at 
the 
recommended 
attachment 
levels 
and limits. 
the 
board 
does 
not 
have 
the 
authority to establish a self-administered plan as provided in 
this section. 
12. 
Marketipg and distribution. 
The board may contract for 
the marketing and distribution of the self-administered plan in 
accordance with the requirements of this subsection. 
Any entity 
or individual that contracts with the self-administered plan 
shall successfully complete all training offered by Dirigo Health 
for the §9licitation. negotiation and sale of health benefits 
coverage. 
Training 
must 
be 
completed 
annually. 
and 
any 
SENATE AMENDMENT 
~(,t~ 
fi~",t~ . 
.,., 
SENATE AMENDMENT "A" to COMMITTEE 
AMENDMENT 
"A" to S . P . 
736, 
L.D. 1935 
certificate establishing successful completion of training is 
valid for one year from the date of issuance. 
If an entity or 
individual 
fails 
to 
obtain 
certification 
following 
the 
expirption of the prior year's certification, 
the entity or 
individupl mpy not continue to solicit, negotiate and sell health 
benefits coverpge under the self-pdministered plan. 
13. 
Provider 
reimbursement. 
In 
any 
contract 
with 
a 
3rd-pprty 
pdministrator, 
cprrier 
or 
other 
organization 
to 
administer 
and provide heplth coverpge 
to enrollees 
of 
the 
self-pdministered plpn, the board shall ensure that: 
A. Providers contracting to provide heplth coverage to plan 
enrollees are reimbursed at a rate comparable to current 
mprket reimbursement rates among comrnercipl carriers in the 
Stpte; 
B. Providers contracting to provide health coverage to plan 
enrollees pre paid in p timely manner in pccordpnce with the 
same requirements that would be required under state law for 
heplth insurance carriers pursupnt to Title 24-A, section 
2436; pnd 
C. If the self-pdministered plan fails to pay for health 
cpre services as set forth in the contract. providers are 
governed by the standards required pursuant to section 4204, 
subsection 6. 
This ppragraph does not prohibit a provider 
from 
collecting 
or 
pttempting 
to 
collect 
from 
a 
plan 
enrollee any amount for services not normplly payable to the 
self-administered plan, including any applica,ble copayments 
and deductibles. 
14. 80 liability for plan enrollees. This section does not 
create any liability on the part of eligible employers, eligible 
employees or eligible individupls enrolled in Dirigo Health in 
th~ event that the self-pdministered plpn becomes insolvent or 
fpils to ppy clpims. 
Sec. C-IO. New appointments to Board of Trustees of Dirigo Health; 
staggered terms. 
Notwithstanding 
the 
Maine 
Revised 
Statutes, 
Title 24-A, 
section 6904, 
subsection 3, 
the terms of the 4 
members added to the Board of Trustees of Dirigo Health pursuant 
to this Act must be staggered. 
The Governor shall appoint one 
member for a term of 1 year, one member for a term of 2 years and 
members for terms of 3 years.' 
Page l4-LR2809(2l) 
SENATE AMENDMENT 
~"~:~' 
t~/'Ok' 
SENATE AMENDMENT It " to COMMITTEE 
AMENDMENT "A" to S.P. 736, 
L.D. 1935 
SUMMARY 
This amendment expands the Dirigo Health Board of Directors 
from 5 to 9 members and renames it the Board of Trustees of 
Dirigo Health. The amendment requires that 3 voting members of 
the board have expertise in accounting, banking, securities or 
insurance and adds the Treasurer of State as an ex officio, 
nonvoting member. The amendment clarifies that 5 members of the 
board constitute a 
quorum and that an affirmative vote of 5 
members is needed for the board to take action. The amendment 
extends the limitation on personal liability of trustees under 
the Maine Uniform Trust Code to the trustees of Dirigo Health. 
The 
amendment 
permits 
licensed insurance 
producers with 
health authority to sell the Dirigo Health Program insurance 
products if the producer meets certain training requirements. 
Additionally, the bill exempts producers 
from the appointment 
requirement solely for purposes of selling the Dirigo Health 
Program 
insurance 
products 
and 
holds 
a 
carrier underwriting 
Dirigo Health Program coverage harmless from liability for any 
actions of such producers. 
The amendment gives authority to Dirigo Health to provide 
access to health benefits coverage through the Dirigo Health 
Self-administered 
Plan 
after 
the 
board 
evaluates 
bids 
for 
self-administered and fully insured benefits coverage. 
If the 
board 
makes 
the 
decision 
to 
provide 
coverage 
through 
a 
self-administered plan, 
the 
amendment 
requires 
the 
board to 
report to the joint standing committee of the Legislature having 
jurisdiction over health insurance matters within 30 days of the 
decision. The amendment also gives the committee the authority to 
report out legislation relating to the self-administered plan. 
If the Dirigo Health Self-administered Plan is established, 
the 
amendment 
authorizes 
the 
board to enter into voluntary 
cooperative agreements with a public purchaser for purchasing and 
administrative functions only, but requires that the risk pools 
and reserves of the Dirigo Health Self-administered Plan and any 
public purchaser may not be commingled. The amendment expands the 
duties and responsibilities of the board with regard to the 
establishment and ongoing management of the self-administered 
plan. 
The amendment requires the board to contract for services 
from 
actuaries, 
investment 
counsel, 
financial 
institutions, 
3rd-party administrators and any other organization necessary to 
administer the plan. 
The 
amendment requires an actuary under 
contract to the board to determine the appropriate level of 
reserves and administrative costs for the plan and the amount of 
stop loss insurance necessary, 
provide opinions regarding the 
actuarial soundness of the plan, develop a rate structure for the 
plan and report annually to the board. 
SENATE AMENDMENT 
",~~, 
,~ 
:"t··· 
SENATE 
AMENDMENT "A" to COMMITTEE 
AMENDMENT 
"A" to s. P. 736, 
L.D. 1935 
The amendment requires the Dirigo Health Self-administered 
Plan to maintain reserves at least equal to the sum of the amount 
necessary to pay claims and administrative costs for the assumed 
risk for 2 1/2 months and the amount determined annually by a 
qualified actuary to be necessary to fund the unpaid portion of 
ultimate expected losses and related expenses incurred in the 
provision 
of 
benefits. 
The 
amendment 
requires 
the 
reserve 
account to be adjusted on a quarterly basis and to be capitalized 
from any initial start-up funds transferred into the account by 
Dirigo Health, monthly enrollee payments, any funds received from 
any 
public 
or 
private 
source, 
legislative 
appropriations, 
payments from any state departments or agencies and any other 
means approved by the Legislature. The amendment also authorizes 
the board to purchase excess or stop loss insurance at attachment, 
limits and levels recommended by a qualified actuary and removes 
the authority to establish a self-administered plan in the event 
the board is unable to purchase that insurance. 
The amendment requires the Dirigo Health Self-administered 
Plan to meet the same requirements of the Maine Insurance Code 
that would be required by state law if health benefits coverage 
were provided by a health insurance carrier for community rating, 
guaranteed issuance, guaranteed renewal, continuity of coverage 
and mandated benefits. 
The 
amendment also requires that the 
self-administered plan extend the 
same benefits, 
rights 
and 
protections of the Maine Revised Statutes, Title 24-A, chapter 
56-A 
and 
Bureau of 
Insurance 
Rule 
Chapter 
850, 
including 
a 
limited right to sue the Dirigo Health Self-administered Plan. 
The amendment specifically waives the State's defense of immunity 
under the Maine Tort Claims Act. 
FISCAL NOTE REQUIRED 
(See attached) 
SPONSORED BY, ~e.t ~ 
(Senator B. BRYANT) 
~8 
COUNTY: 
Oxford 
SENATE AMENDMENT 
Approved: OS/23/06 frac 
LD 1935 
LR2809(21) 
An Act To Protect Health Insurance Consumers 
Fiscal Note for Senate Amendment A" to Committee Amendment ,A" 
Sponsor: Sen. Bryant 
Fiscal Detail and Notes 
Fiscal Note Required: Yes 
Fiscal Note 
Potential current biennium cost increase - General Fund 
Minor cost increase - Other Funds 
Assumes that by giving the Dirigo Health Program the option to convert to a self-administered plan, this amendment 
could result in the State bearing additional fmancialliability if the reserve and stop loss insurance provisions included 
in the amendment prove to be inadequate. ~ssumes any additional costs to the Dirigo Health Program from the other 
changes made in the amendment can be absorbed by the program utilizing existing resources of the Dirigo Health 
Enterprise Fund. Assumes any additional costs to the Bureau of Insurance in the Department of Professional and 
Financial Regulation can be absorbed utilizing existing budgetary resources. 
LR2809(21) - Fiscal Note - Page 1 of 1