An Act To Provide a Mandate-free Health Insurance Policy
Maine Legislature, Session 122, LD 0114
Committee: Insurance and Financial Services
Sponsors: CRESSEY, ANNIS, DAVIS, FLETCHER, MOODY, NASS, NUTTING, SHIELDS, SNOWE-MELLO

Legislative Document 
No. 114 
H.P.90 
House of Representati ves, January 11, 2005 
An Act To Provide a Mandate-free Health Insurance Policy 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
Presented by Representative CRESSEY of Cornish. 
Cosponsored by Senator SA V AGE of Knox and 
'17/~ /J7. 7Ild£~ 
MILLICENT M. MacFARLAND 
Clerk 
Representatives: ANNIS of Dover-Foxcroft, DAVIS of Falmouth, FLETCHER of Winslow, 
MOODY of Manchester, NASS of Acton, NUTTING of Oakland, SHIELDS of Auburn, 
Senator: SNOWE-MELLO of Androscoggin. 
Printed on re(,;ycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. I. 24-A MRSA c. 33-A is enacted to read: 
CHAPTER 33-A 
BASIC CARE MEDICAL PLANS 
§Z761. 
Definitions 
As 
used 
in this 
chapter, 
unless 
the 
context 
otherwise 
indicates, the followingterms have the following meanings. 
1. 
Basic care medical plan. "Basic care medical plan" Qr 
"plan" means a plan providing health care benefits in accordance 
with this chapter. 
2. Basic care medical plan pool. "Basic care medical plan 
pool" or "pool" means 
a pool for distributing the risk among 
carriers as provided in section 2767. 
3. Carrier. "Carrier" has the same meaning as in section 
4301-A, subsection 3. 
4. Eligible enrollee. "Eligible enrollee" means 
a 
person 
who, at the time of application and determination of eligibility 
for a basic care medical plan, has an annual income at 200°6 or 
below the federal non-farm income poverty level and has no other 
health insurance or health care coverage. 
§Z76Z. 
Basic care medical plan benefits 
Carriers may issue 
with this chapter, 
and 
requirements. 
basic care medical 
those plans 
must 
plans 
meet 
in 
accordanq~ 
the 
following 
1. Availability of coverage. Coverage must be available to 
all eligible enrollees beginning on or after January 1, 2006. 
2. Mandatory managed care provisions. 
The plan must include 
the following managed care provisions to control costs: 
A. 
An 
exclusion 
for 
services 
that 
are 
not 
medical-.ly 
necessary or are not covered preventive health services; and 
B. 
A procedure for preauthor ization by the carrier or its 
designated utilization review entity. 
Page l-LR0257(1) 
3. Optional managed care provisions. The plan may include 
the following managed care provisions to control costs: 
A. A network of preferred providers; 
B. Provisions reguiring a 2nd surgical opinion; and 
c. 
A procedure for additional utilization review by the 
carrier or its designated utilization review entity. 
This subsection may not __ be construed to prohibita carrier from 
including in its policy additional managed care and cost control 
provisions that, subject to the approval of the superintendent, 
have the potential to control costs in a manner that does not 
result in ineguitable treatment of enrollees. 
4. Basic levels of care. 
The plan must provide basic levels 
of 
care 
for 
enrollees, 
including, 
but 
not 
limited 
to, 
the 
following: 
A. 
A 
minimum 
of 
days 
of 
inpatient 
hospitalization 
coverage per policy year; 
B. Prenatal, postnatal and well-baby care; 
C. Professional services including inpatient medical care, 
surgery 
and anesthesia, 
maternity delivery 
and 
emergency 
care; and 
D. Outpatient services including emergency care, ambulatory 
or 
day 
surgery, 
diagnostic 
services, 
radiation 
and 
chemotherapy. 
5. 
Enrollee's responsibility for 
payment. 
The 
following 
APplies to the level of deductible, coinsurance and out-of-pocket 
payment maximum established for basic care medical plans. 
A. 
The plan must include a deductible not less than $1,000 
nor greater than $5,000 per covered enrollee per policy year. 
B. The plan mu_st include a coinsurance amount not less than 
20% nor greater than 40~, except that the plan may establish 
coinsurance at not less than 40°" nor greater than 75°b for 
emergency 
care 
provided 
by 
a 
hospital. 
The 
maximum 
coinsurance amount per covered enrollee per policy year 
i~ 
$3,000. 
C. The maximum out-of-pocket level may not be greater than 
$8,000 per covered enrollee per policy year. 
§2763. 
Exemption from mandates 
Except as provided in this chapter, any statutory provision 
in this Title applicable to individual health insurance that 
mandates medical benefits or coverage for certain specific health 
services or diseases or certain providers of health care services 
does not apply to basic care medical plans issued pursuant to 
this chapter. 
§2764. 
Applicability of certain prOV1S1ons relating to 
individual health insurance 
The provisions of section 2736-C, including, but not limited 
to, 
those provisions relating to 
community rating, guaranteed 
issuance 
and guaranteed renewal, 
apply to basic care medical 
plans issued pursuant to this chapter. 
§2765. 
Disclosure 
1. Statement to insured. On the application for 
the carrier shall provide potential enrollees with 
coverage L 
a 
written 
statement containing at least the following: 
A. 
An explanation of the terms and conditions for benefits 
under 
the 
plan, 
including 
information 
about 
covered 
services, deductibles, coinsurance and out-of-pocket maximum 
limi ts; 
B. An explanation of those mandated benefits and providers 
that are not covered by the plan pursuant to section 2763; 
and 
C. 
An 
explanation of 
the managed care 
and cost control 
features of the plan. 
2. Statement from enrollee. Before issuing a 
plan to 
ax! 
eligible enrollee, 
a 
carrier shall obtain 
from 
the eligible 
enrollee 
a 
signed 
written 
statement 
in 
which 
the 
eligible 
enrollee: 
A. 
Certifies 
that 
the 
enrollee 
and all 
dependents 
are 
eligible for coverage under the plan; 
B. 
Acknowledges the limited nature of the coverage and an 
understanding of the managed care and cost control features 
of the plan; and 
C. 
Acknowledges 
that, 
if 
misrepresentations 
are 
made 
regarding eligibility for coverage, 
the person making the 
misrepresentations will forfeit coverage provided by the 
plan. 
§Z766. 
Forms 
All 
plan 
forms, 
including 
applications, 
evidence 
of 
coverage, 
riders, 
amendments, 
endorsements 
and 
disclosure 
statements, must be submitted to the superintendent for approval 
in the same manner as required by section 2412. 
§Z767. 
Basic care medical plan pool 
Carriers that issue basic care medical plans may form a pool 
for the purpose of distributing among carriers in the pool the 
financial risk of coverage for enrollees. The pool may not become 
operational until the superintendent approves a plan of operation 
submitted by carrier members. The superintendent may approve the 
establishment of a pool only after a determination that the pool 
is in the public interest and is consistent with this chapter and 
any rules adopted pursuant to this chapter. The carrier members 
of the pool shall guarantee, without limitation, the solvency of 
the 
pool. 
The 
guarantee 
constitutes 
an 
ongoing 
financial 
obligation of each carrier member on a pro rata basis. 
§Z768. 
Rules 
2(' 
The superintendent may adopt rules necessary to implement 
this chapter. Rules adopted pursuant to this chapter are routine 
technical rules as defined in Title 5 , 
chapter 375 , 
subchapter: 
SUMMARY 
J4 
This bill authorizes basic care medical plans to provide 
health 
insurance 
with 
high 
deductibles 
and 
levels 
of 
coinsurance. 
Individuals who have incomes at 200
0b or below the 
federal non-farm income poverty level and have no other coverage 
may 
purchase 
the 
plans. 
The 
plans 
cover 
hospitalization, 
prenatal, postnatal and well-baby care, surgery and emergency and 
outpatient 
care. 
The 
plans 
are 
exempt 
from 
all state 
laws 
mandating insurance coverage of certain health care services Ot 
certain 
health 
care 
providers. 
The 
plans 
are 
subject 
to 
provisions relating to community rating, guaranteed issuance and 
guaranteed renewal for individual health insurance policies. 
The 
carr iers that offer basic care medical plans are authorized to 
form 
a 
pool to distribute the risk of providing coverage to 
enrollees.