An Act To Make Health Care Affordable, Accessible and Effective for All I I
Maine Legislature, Session 123, LD 1890
Committee Amendment CA_A-SA_B_S384 (Senate)
Amends: 24-A MRSA §2, 24-A MRSA §2839, 24-A MRSA §4303, 24-A MRSA §2736-C, 24-A MRSA §423-D, 24-A MRSA §6908, 24-A MRSA §6910, 24-A MRSA §6912, 22 MRSA §1721, 24-A MRSA §2736, 24-A MRSA §2736-A, 24-A MRSA §2839-B, 24-A MRSA §6913, 24-A MRSA §6915, 24-A MRSA §6951, 24-A MRSA §2735-A

SENATE AMENDMENT" B" to COMMITTEE AMENDMENT "A" to H.P. 
1322, L.D. 1890, BiIl, "An Act To Make Health Care Affordable, Accessible and 
Effective for All" 
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Amend the amendment by striking out everything after the title and before the 
summary and inserting the foIlowing: 
'Amend the bill by striking out everything after the enacting clause and before the 
summary and inserting the following: 
'PART A 
Sec. A-I. 24-A MRSA §2S0S-B, sub-§2, ~C, as amended by PL 2001, c. 410, 
Pt. A, §3 and affected by § I 0, is further amended to read: 
C. A carrier may vary the premium rate due to family membership, smoking status, 
participation in weIlness programs in accordance with section 4303, subsection 12 
and group size for all policies, contracts or certificates that are executed, delivered, 
issued for delivery, continued or renewed in this State on or after January I, 2008. 
The superintendent may adopt rules setting forth appropriate methodologies 
regarding rate discounts pursuant to this paragraph. Rules adopted pursuant to this 
paragraph are routine technical rules as defined in Title 5, chapter 375, subchapter H-
A 2-A. 
Sec. A-2. 24-A MRSA §2839, as amended by PL 2003, c. 428, Pt. E, §2, is 
further amended by adding at the end a new paragraph to read: 
A carrier may vary the premium rate due to participation in well ness programs in 
accordance with section 4303, subsection 12 for all policies, contracts or certificates that 
are executed, delivered, issued for delivery, continued or renewed in this State on or after 
January 1, 2008. 
Sec. A-3. 24-A MRSA §4303, sub-§12 is enacted to read: 
12. Wellness program. A carrier offering a health plan in this State shall develop 
and maintain a well ness program for enrollees in small group and group health plans. A 
carrier shall offer enrollees that participate in a wellness program a financially tangible 
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SENATE AMENDMENT "fJ" to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
benefit, including, but not limited to, a discount in premium pursuant to section 2808-B, 
subsection 2, paragraph C. A carrier shall report before January 1 st annually to the 
superintendent, in the manner and format approved by the superintendent, on the wellness 
program offered by the carrier, the financial benefits provided to enrollees, including 
premium discounts, and the number of enrollees participating in the wellness program. 
On or before April I st annually, the superintendent shall compile the data submitted by 
carriers as required in this subsection and submit that data in aggregate for all carriers to 
the joint standing committee of the Legislature having jurisdiction over insurance and 
financial services matters and to the Maine Quality Forum established in section 6951. 
PARTB 
Sec. B-l. 24-A MRSA §2736-C, sub-§8, as amended by PL 1999, c. 256, Pt. D, 
§2, is further amended to read: 
8. Authority of the superintendent. The superintendent may shall by rule define 
one or more standardized individual health plans that must be offered by all carriers 
offering individual health plans in the State, other than carriers offering only CHAMPUS 
supplemental coverage. One of the plans defined by rule under this section must be a plan 
that includes a $1,000 deductible, a prescription drug benefit not subject to a deductible 
and the option of no cap on the lifetime maximum benefit. 
PARTC 
Sec. C-l. 24-A MRSA §4303, sub-§l, as amended by PL 2007, c. 199, Pt. B, §5, 
is further amended to read: 
1. 
Demonstration of adequate access to providers. 
Except as provided in 
paragraph A paragraphs A-I and B, a carrier offering or renewing a managed care plan 
shall provide to its members reasonable access to health care services in accordance with 
standards developed by rule by the superintendent. These standards must consider the 
geographical and transportational problems in rural areas. 
All managed care plans 
covering residents of this State must provide reasonable access to providers consistent 
with the access-to-services requirements of any applicable bureau rule. 
A. 
Upon approval of the superintendent, a carrier may offer a health plan that 
includes financial provisions designed to encourage members to use designated 
providers in a network if: 
(I) The entire network meets overall access standards pursuant to Bureau of 
Insurance Rule Chapter 850; 
(2) The health plan is consistent with product design guidelines for Bureau of 
Insurance Rule Chapter 750; 
(3) The health plan does not include financial provisions designed to encourage 
members to use designated providers of primary, preventive, maternity, 
obstetrical, ancillary or emergency care services, as defined in Bureau of 
Insurance Rule Chapter 850; 
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to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
(4) The financial provisions may apply to all of the enrollees covered under the 
carrier's health plan; 
(5) The carrier establishes to the satisfaction of the superintendent that the 
financial provisions permit the provision of better quality services and the quality 
improvements either significantly outweigh any detrimental impact to covered 
persons forced to travel longer distances to access services, or the carrier has 
taken steps to effectively mitigate any detrimental impact associated with 
requiring covered persons to travel longer distances to access services. The 
superintendent may consult with other state entities, including the Department of 
Health and Human Services, Bureau of Health and the Maine Quality Forum 
established in section 6951, to determine whether the carrier has met the 
requirements of this subparagraph. The superintendent shall provisionally adopt 
rules by January 1, 2004 regarding the criteria used by the superintendent to 
determine whether the carrier meets the quality requirements of this subparagraph 
and present those rules for legislative review during the Second Regular Session 
of the 121 st Legislature; and 
(6) The financial provisions may not permit travel at a distance that exceeds the 
standards established in Bureau of Insurance Rule Chapter 850 for mileage and 
travel time by 100%. 
This paragraph takes effect January 1,2004 and is repealed July 1,2009. 
A-I. Upon approval of the superintendent, a carrier may offer a health plan that 
includes financial provisions designed to encourage members to use designated 
providers in a network if: 
(1) The entire network meets overall access standards pursuant to Bureau of 
Insurance Rule Chapter 850; 
(2) The health plan does not include financial provisions designed to encourage 
members to use designated providers of primary, preventive, maternity, 
obstetrical, ancillary or emergency care services, as defined in Bureau of 
Insurance Rule Chapter 850; 
(3) The financial provisions apply to all of the enrollees covered under the 
carrier's health plan; 
(4) The carrier establishes to the satisfaction of the superintendent that the 
financial provisions permit the provision of better quality services and the quality 
improvements either significantly outweigh any detrimental impact to covered 
persons forced to travel longer distances to access services or the carrier has 
taken steps to effectively mitigate any detrimental impact associated with 
requiring covered persons to travel longer distances to access services. The 
superintendent may consult with other state entities, including the Department of 
Health and Human Services and the Maine Quality Forum established in section 
6951, to determine whether the carrier has met the requirements of this 
subparagraph; and 
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SENATE AMENDMENT" B" to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
(5) The financial provisions do not permit travel at a distance that exceeds the 
standards established in Bureau of Insurance Rule Chapter 850 for mileage and 
travel time by 100%. 
B. 
Notwithstanding paragraph A-I, a carrier may develop and file with the 
superintendent for approval a pilot program that does not adhere to any geographic 
access requirements set forth in this Title or in rules adopted by the superintendent. 
Any carrier offering a health plan using this pilot program must collect data on the 
impact of the pilot program on premiums paid by enrollees, payments made to 
providers, quality of care received and access to health care services by individuals 
enrolled in health plans under the pilot program and must submit that data to the 
superintendent. The superintendent shall report annually beginning January 15,2009 
to the joint standing committee of the Legislature having jurisdiction over insurance 
and financial services matters on any approval of a pilot program pursuant to this 
paragraph. 
PARTD 
Sec. D-I. 24-A MRSA §2736-C, sub-§3, as corrected by RR 2001, c. I, §30, is 
amended to read: 
3. Guaranteed issuance and guaranteed renewal. Carriers providing individual 
health plans must offer all health plans approved by the Maine Individual High-risk 
Reinsurance Pool Association pursuant to section 3908, subsection 1 beginning on or 
after January I, 2009 as a condition of offering individual health plans in this State. 
Carriers must meet the following requirements on issuance and renewal. 
A. 
Coverage issued through the Maine Individual High-risk Reinsurance Pool 
Association established pursuant to chapter 54 must be guaranteed to all residents of 
this State eligible for coverage pursuant to section 3910 other than those eligible 
without paying a premium for Medicare Part A. On or after January I, 1998, such 
coverage must be guaranteed to all legally domiciled federally eligible individuals, as 
defined in section 2848, regardless of the length of time they have been legally 
domiciled in this State. Except for federally eligible individuals, such coverage need 
not be issued to an individual whose coverage was terminated for nonpayment of 
premiums during the previous 91 days or for fraud or intentional misrepresentation of 
material fact during the previous 12 months. When a managed care plan, as defined 
by section 430I-A, provides coverage a carrier may: 
(1) Deny coverage to individuals who neither live nor reside within the approved 
service area of the plan for at least 6 months of each year; and 
(2) 
Deny coverage to individuals jf the carrier has demonstrated to the 
superintendent'S satisfaction that: 
(a) The carrier does not have the capacity to deliver services adequately to 
additional enrollees within all or a designated part of its service area because 
of its obligations to existing enrollees; and 
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(b) The carrier is applying this provision unifonnly to individuals and groups 
without regard to any health~related factor. 
A carrier that denies coverage in accordance with this paragraph may not enroll 
individuals residing within the area subject to denial of coverage or groups or 
subgroups within that area for a period of 180 days after the date of the first denial of 
coverage. 
B. Renewal is guaranteed for all individual health plans, pursuant to section 2850-B. 
C. A carrier is exempt from the guaranteed issuance requirements of paragraph A 
provided that the following requirements are met7~ 
(1) The carrier does not issue or deliver any new individual health plans on or 
after the effective date ofthis section; 
(2) If any individual health plans that were not issued on a guaranteed renewable 
basis are renewed on or after December 1, 1993, all such policies must be 
renewed by the carrier and renewal must be guaranteed after the first such 
renewal date; and 
(3) The carrier complies with the rating practices requirements of subsection 2. 
D. Notwithstanding paragraph A, carriers offering supplemental coverage for the 
Civilian Health and Medical Program for the Unifonned Services, CHAMPUS, are 
not required to issue this coverage if the applicant for insurance does not have 
CHAMPUS coverage. 
E. An individual may not be denied coverage under any individual health plan due 
to age or gender. This paragraph may not be construed to require a carrier to actively 
market health insurance to an individual 65 years of age or older. 
Sec. D-2. 24-A MRSA c. 54 is enacted to read: 
CHAPTER 54 
MAINE INDIVIDUAL HIGH-RISK REINSURANCE POOL 
ASSOCIATION 
§3901. Short title 
This chapter may be known and cited as "the Maine Individual High-risk Reinsurance 
Pool Association Act. " 
§3902. Definitions 
As used in this chapter, unless the context otherwise indicates, the following tenns 
have the following meanings. 
1. Association. "Association" means the Maine Individual High-risk Reinsurance 
Pool Association established in section 3903. 
2. Board. "Board" means the board of directors of the association. 
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3. Covered person. "Covered person" means an individual resident of this State, 
exclusive of dependents, who: 
A. Is eligible to receive benefits from an insurer; 
B. 
Is eligible for benefits under the federal Health Insurance Portability and 
Accountability Act of 1996; or 
C. 
Has been certified as eligible for federal trade adjustment assistance or for 
pension benefit guarantee corporation assistance, as provided by the federal Trade 
Adjustment Assistance Reform Act of 2002. 
4. Dependent. "Dependent" means a resident spouse, a domestic partner as defined 
in section 2832-A, subsection 1, a resident unmarried child under 19 years of age, a child 
who is a student under 23 years of age and who is financially dependent upon the parent 
or a child of any age who is disabled and dependent upon the parent. 
5. Health maintenance organization. "Health maintenance organization" means an 
organization authorized under chapter 56 to operate a health maintenance organization in 
this State. 
6. Insurer. "Insurer" means an entity that is authorized to write medical insurance 
or that provides medical insurance in this State. "Insurer" includes an insurance company, 
nonprofit hospital and medical service organization, fraternal benefit society, health 
maintenance organization, self-insurance arrangement that provides health care benefits 
in this State to the extent allowed under the federal Employee Retirement Income 
Security Act of 1974, 3rd-party administrator, multiple-employer welfare arrangement, 
any other entity providing medical insurance or health benefits subject to state insurance 
regulation, any reinsurer reissuing health insurance in this State or the Dirigo Health 
Program established in chapter 87 or any other state-run or state-sponsored health benefit 
program, whether fully insured or self-funded. 
7. Medical insurance. "Medical insurance" means a hospital and medical expense-
incurred policy, nonprofit hospital and medical service plan, health maintenance 
organization subscriber contract or other health care plan or arrangement that pays for or 
furnishes medical or health care services by insurance or otherwise, whether sold as an 
individual or group policy. "Medical insurance" does not include accidental injury, 
specified disease, hospital indemnity, dental, vision, disability income, Medicare 
supplement, long-term care or other limited benefit health insurance or credit insurance; 
coverage issued as a supplement to liability insurance; insurance arising out of workers' 
compensation or similar law; or automobile medical payment insurance or insurance 
under which benefits are payable with or without regard to fault and that is statutorily 
required to be contained in any liability insurance policy or equivalent self-insurance. 
8. Medicare. "Medicare" means coverage under both Parts A and B of Title XVIII 
of the Social Security Act, 42 United States Code, Section 1395 et seq., as amended. 
9. Producer. "Producer" means a person who is licensed to sell health insurance in 
this State. 
10. Reinsurer. "Reinsurer" means an insurer from whom a person providing health 
insurance for a resident procures insurance for itself with the insurer with respect to all or 
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part of the medical insurance risk of the person. "Reinsurer" includes an insurer that 
provides employee benefits excess insurance. 
11. Resident. "Resident" has the same meaning as in section 2736-C, subsection 1. 
paragraph C-2. "Resident" includes an individual who is legally domiciled in this State 
on the date of application to the plan and has been certified as eligible for federal trade 
adjustment assistance or for pension benefit guarantee corporation assistance, as provided 
by the federal Trade Adjustment Assistance Reform Act of 2002. 
12. Third-party administrator. "Third-party administrator" means an entity that is 
paying or processing medical insurance claims for a resident. 
§3903. Maine Individual High-risk Reinsurance Pool Association 
1. 
Risk pool established. 
The Maine Individual High-risk Reinsurance Pool 
Association is established as a nonprofit legal entity. As a condition of doing business, 
every insurer that has sold medical insurance within the previous 12 months or is actively 
marketing a medical insurance policy in this State shall participate in the association. The 
Dirigo Health Program established in chapter 87 and any other state-run or state-
sponsored health benefit program shall also participate in the association. 
2. Board of directors. The association is governed by a board of directors In 
accordance with this subsection. 
A. The board consists of 11 members appointed pursuant to this paragraph: 
(1) Six members appointed by the superintendent. of whom: 
(a) Two members must be chosen from the general public and may not be 
associated with the medical profession, a hospital or an insurer; 
(b) Two members must represent medical providers; 
(c) One member must represent health insurance producers; and 
(d) One member must represent a statewide association representing small 
businesses that receives the majority of its funding from persons and 
businesses in the State.A board member appointed by the superintendent may 
be removed at any time without cause; and 
(2) Five members appointed by insurers belonging to the association, at least 2 
of whom are domestic insurers and at least one of whom is a 3rd-party 
administrator. 
B. Members serve terms of 3 years. 
C. The board shall elect one of its members as chair. 
D. Board members may be reimbursed from funds of the association for actual and 
necessary expenses incurred by them as members but may not otherwise be 
compensated for their services. 
3. Plan of operation; rules. The association shall adopt a plan of operation in 
accordance with the requirements of this chapter and submit its articles, bylaws and 
operating rules to the superintendent for approval. If the association fails to adopt the plan 
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of operation and suitable articles and bylaws within 90 days after the appointment of the 
board, the superintendent shaH adopt rules to effectuate the requirements of this chapter, 
and those rules remain in effect until superseded by a plan of operation and articles and 
bylaws submitted by the association and approved by the superintendent. Rules adopted 
pursuant to this subsection by the superintendent are routine technical rules as defined in 
Title 5, chapter 375, subchapter 2-A. 
4. Immunity. A board member is not liable and is immune from suit at law or 
equity for any conduct performed in good faith that is within the subject matter over 
which the board has been given jurisdiction. 
§3904. Liability and indemnification 
1. Liability. The board and its employees may not be held liable for any obligations 
of the association. A cause of action may not arise against the association; the board, its 
agents or its employees; any insurer belonging to the association or its agents, employees 
or producers; or the superintendent for any action or omission in the performance of 
powers and duties pursuant to this chapter. 
2. 
Indemnification. 
The board in its bylaws or rules may provide for 
indemnification of, and legal representation for, its members and employees. 
§3905. Duties and powers of the association 
1. Duties. The association shall: 
A. 
Establish administrative and accounting procedures for the operation of the 
association; 
B. Establish procedures under which applicants and participants in the plan may 
have grievances reviewed by an impartial body and reported to the board; 
C. Select a plan administrator in accordance with section 3906; 
D. Establish procedures for the handling and accounting of pool assets; 
E. Collect assessments as provided in section 3907. The level of payments must be 
established by the board. Assessments must be collected pursuant to the plan of 
operation approved by the board. In addition to the collection of such assessments, 
the association shall collect an organizational assessment or assessments from all 
insurers as necessary to provide for expenses that have been incurred or are estimated 
to be incurred prior to receipt of the first calendar year assessments. Organizational 
assessments must be equal in amount for all insurers but may not exceed $500 per 
insurer for all such assessments. Assessments are due and payable within 30 days of 
receipt of the assessment notice by the insurer; and 
F. Comply with all reserve requirements and solvency requirements applicable to 
insurers that offer fully insured products in the event that the association offers a self-
funded health plan. 
2. Powers. The association may: 
A. Exercise powers granted to insurers under the laws of this State; 
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SENATE AMENDMENT" 6 "to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
B. 
Enter into contracts as necessary or proper to carry out the provisions and 
purposes of this chapter, including the authority. with the approval of the 
superintendent, to enter into contracts with similar organizations in other states for 
the joint performance of common administrative functions or with persons or other 
organizations for the performance of administrative functions; 
C. Sue or be sued, including taking any legal actions necessary or proper to recover 
or collect assessments due the association; 
D. Take any legal actions necessary to avoid the payment of improper claims against 
the association or the coverage provided by or through the association, to recover any 
amounts erroneously or improperly paid by the association, to recover any amounts 
paid by the association as a result of mistake of fact or law or to recover other 
amounts due the association; 
E. Define the health benefit plans for which reinsurance will be provided under this 
chapter; 
F. Appoint appropriate legal, actuarial and other committees as necessary to provide 
technical assistance in the operation of the plan, policy or other contract design and 
any other function within the authority of the association; 
G. Borrow money to effect the purposes of the association. Any notes or other 
evidence of indebtedness of the association not in default must be legal investments 
for insurers and may be carried as admitted assets: 
H. Establish rules, conditions and procedures for reinsuring risks of insurers under 
the pool in accordance with section 3909; 
I. Provide for reinsurance of risks incurred by the association. The provision of 
reinsurance may not subject the association to any of the capital or surplus 
requirements, if any, otherwise applicable to reinsurers; and 
J. Apply for funds or grants from public or private sources, including federal grants 
provided to qualified high-risk reinsurance pools. 
3. Additional duties and powers. The superintendent may, by rule, establish 
additional powers and duties of the association and may adopt such rules as are necessary 
and proper to implement this chapter. Rules adopted pursuant to this subsection are 
routine technical rules as defined in Title 5, chapter 375, subchapter 2-A. 
4. Review for solvency. The superintendent shall review the operations of the 
association at least every 3 years to determine its solvency. If the superintendent 
determines that the funds of the association are insufficient to support the need for 
reinsurance, the superintendent may order the association to increase its assessments. If 
the superintendent determines that the funds of the association are insufficient, the 
superintendent may order the association to charge an additional assessment. 
5. 
Annual report. The association shall report annually to the joint standing 
committee of the Legislature having jurisdiction over health insurance matters by March 
15th. The report must include information on the benefits and rate structure of coverage 
offered by the association, the financial solvency ofthe association and the administrative 
expenses of the association. 
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SENATE AMENDMENT "6 "to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
6. Audit. The association must be audited at least every 3 years. A copy of the audit 
must be provided to the superintendent and to the joint standing committee of the 
Legislature having jurisdiction over health insurance matters. 
§3906. Selection of plan administrator 
1. Selection of plan administrator. The board shall select an insurer or 3rd-party 
administrator, through a competitive bidding process, to administer the association. 
2. Contract with plan administrator. The plan administrator selected pursuant to 
subsection 1 is contracted for a period of 3 years. At least one year prior to the expiration 
of each 3-year period of service by a plan administrator, the board shall invite all insurers, 
including the current plan administrator, to submit bids to serve as the plan administrator 
for the succeeding 3-year period. The selection of the plan administrator for the 
succeeding period must be made at least 6 months prior to the expiration of the 3-year 
period. 
3. 
Duties of plan administrator. The plan administrator selected pursuant to 
subsection 1 shall: 
A. Perform aU administrative functions relating to the association; 
B. Pay a producer's referral fee if established by the board to each producer who 
refers an applicant to the plan, if the applicant's application is accepted. The selling or 
marketing of policies approved by the association is not limited to the plan 
administrator or its producers. The plan administrator shall pay the referral fees from 
funds received as premiums for the plan; 
C. Submit regular reports to the board regarding the operation of the association. 
The frequency, content and form of the reports must be as determined by the board; 
D. Following the close of each calendar year, determine net premiums, reinsurance 
premiums less administrative expense allowance, the expenses of administration 
pertaining to the reinsurance operations of the association and the incurred losses of 
the year and report this information to the superintendent; and 
E. Pay reinsurance amounts as provided for in the plan of operation. 
4. Payment to plan administrator. The plan administrator selected pursuant to 
subsection 1 must be paid, as provided in the contract of the association under subsection 
2, for the plan administrator's direct and indirect expenses incurred in the performance of 
the plan administrator's services. As used in this subsection, "direct and indirect 
expenses" includes that portion of the audited administrative costs, printing expenses, 
management expenses, building overhead expenses and other actual operating and 
administrative expenses of the plan administrator that are approved by the board as 
allocable to the administration of the association and included in the specifications of a 
bid under subsection 2. 
§3907. Assessments against insurers 
1. Assessments. For the purpose of providing the funds necessary to carry out the 
powers and duties of the association, the board shall assess member insurers at such a 
time and for such amounts as the board finds necessary. Assessments are due not less 
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SENATE AMENDMENT" 6 "to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
than 30 days after written notice to the member insurers and accrue interest at 12% per 
annum on and after the due date. 
2. Maximum assessment. Each insurer must be assessed by the board an amount 
not to exceed $2 per covered person insured or reinsured by each insurer per month for 
medical insurance. An insurer may not be assessed on policies or contracts insuring 
federal or state employees. 
3. Determination of assessment. The board shall make reasonable efforts to ensure 
that each covered person is counted only once with respect to an assessment. For that 
purpose, the board shall require each insurer that obtains excess or stop loss insurance to 
include in its count of covered persons all individuals whose coverage is insured, in 
whole or in part, through excess or stop loss coverage. The board shall allow a reinsurer 
to exclude from its number of covered persons those who have been counted by the 
primary insurer or by the primary reinsurer or primary excess or stop loss insurer for the 
purpose of determining its assessment under this subsection. The board may verify each 
insurer's assessment based on annual statements and other reports determined to be 
necessary by the board. The board may use any reasonable method of estimating the 
number of covered persons of an insurer if the specific number is unknown. 
4. Excess funds. If assessments and other receipts by the association, board or plan 
administrator exceed the actual losses and administrative expenses of the plan, the board 
shall hold the excess as interest and may use those excess funds to offset future losses or 
to reduce plan premiums. As used in this subsection, "future losses" includes reserves for 
claims incurred but not reported. 
5. Failure to pay assessment. The superintendent may suspend or revoke, after 
notice and hearing, the certificate of authority to transact insurance in this State of any 
member insurer that fails to pay an assessment. As an alternative, the superintendent may 
levy a penalty on any member insurer that fails to pay an assessment when due. In 
addition, the superintendent may use any power granted to the superintendent by this 
Title to collect any unpaid assessment. 
6. Net losses; additional assessments. For the purpose of providing the funds 
necessary to carry out the powers and duties of the association, the board shall assess 
member insurers at such a time and for such amounts as the board finds necessary to 
cover any net loss in accordance with this subsection. 
A. Prior to April I st of each year, the association shall determine and report to the 
superintendent the association's net loss for the previous calendar year, including 
administrative expenses and incurred losses for the year, taking into account 
investment income and other appropriate gains and losses and an estimate of the 
assessments needed to fund the loss incurred by the association in the previous 
calendar year. 
B. Individual assessments of each insurer are determined by multiplying net losses, if 
net earnings are negative, by a fraction, the numerator of which is the insurer's total 
premiums earned in the preceding calendar year from all health benefit plans, 
including excess or stop loss coverage, and the denominator of which is the total 
premiums earned in the preceding calendar year from all health benefit plans. 
C. The association shall impose a penalty of interest for late payment of assessments. 
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§3908. Requirements for coverage 
1. Approved coverage. The association shall approve a choice of 2 or more 
coverage options for which reinsurance is available through the association. Policies 
approved by the association must be available for sale beginning on January 1, 2009. At 
least one coverage option must be a standardized health plan as defined in Bureau of 
Insurance Rule Chapter 750. Any person whose medical insurance coverage is 
involuntarily terminated for any reason other than nonpayment of premiums may apply 
for coverage under the plan. If such coverage is applied for within 90 days after the 
involuntary termination and if premiums are paid for the entire period of coverage, the 
effective date of the coverage is the date of termination ofthe previous coverage. 
2. 
Rates. 
Rates for coverage approved by the association must meet the 
requirements of this subsection. 
A. 
Rates may not be unreasonable in relation to the benefits provided, the risk 
experience and the reasonable expenses of providing the coverage. 
B. Rate schedules must comply with section 2736-C and are subject to approval by 
the superintendent. 
C. Standard risk rates for coverage issued by the association must be established by 
the association, subject to approval by the superintendent, using reasonable actuarial 
techniques, and must reflect anticipated experiences and expenses of such coverage 
for standard risks. The premium for the standard risk rates must range from a 
minimum of 125% to a maximum of 150% of the weighted average of rates charged 
by those insurers and health maintenance organizations with individuals enrolled in 
similar medical insurance plans. 
3. Compliance with state law. Products approved by the association must comply 
with all relevant requirements of this Title applicable to individual health insurance 
policies, including requirements for mandated coverage for specific health services, for 
specific diseases and for certain providers of health care services. 
§3909. Reinsurance; premium rates 
1. Reinsurance amount. Any insurer offering the coverage options approved by the 
association pursuant to section 3908, subsection 1 must be reinsured by the association to 
the level of coverage provided in this subsection and is liable to the association for the 
reinsurance premium rate established in accordance with subsection 2. 
A. The association may not reimburse a reinsuring insurer with respect to claims of a 
reinsured person until the insurer has incurred an initial level of claims for that person 
of $5,000 for covered benefits in a calendar year. In addition, the reinsuring insurer is 
responsible for 10% of the next $25,000 of claims paid during a calendar year. The 
association shall reimburse reinsuring insurers for claims paid in excess of $25,000. 
The association may annually adjust the initial level of claims and the maximum limit 
to be retained by the reinsuring insurer to reflect increases in costs and utilization 
within the standard market for health plans within the State. The adjustments may not 
be less than the annual change in the medical component of the Consumer Price 
Index unless the superintendent approves a lower adjustment factor as requested by 
the association. 
SENATE AMENDMENT 
· f:~" 
"\.".:'\ 
SENATE AMENDMENT" 6 " 
to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
B. 
A reinsuring insurer shall apply all managed care, utilization review, case 
management, preferred provider arrangements, claims processing and other methods 
of operation without regard to whether claims paid for coverage are reinsured under 
this subsection. 
2. Premium rates. The association may charge reinsuring insurers premium rates 
established in accordance with this subsection. The association, as part of the plan of 
operation, shall establish a methodology for determining premium rates to be charged 
reinsuring insurers to reinsure persons eligible for coverage under this chapter. The 
methodology must include a system for classification of persons eligible for coverage that 
reflects the types of case characteristics used by insurers for individual health plans 
pursuant to section 2736-C. The methodology must provide for the development of base 
reinsurance premium rates, subject to approval of the superintendent, set at levels that 
reasonably approximate gross premiums charged for individual health plans with similar 
benefits to the coverage options approved by the association pursuant to section 3908, 
subsection 1 and that are adjusted to reflect retention levels required under this Title. The 
association shall periodically review the methodology established under this subsection 
and may make changes to the methodology as needed with the approval of the 
superintendent. The association may consider adjustments to the premium rates charged 
for reinsurance to reflect the use of effective cost containment and managed care 
arrangements by a reinsuring insurer. 
§3910. Eligibility for coverage 
1. Eligibility; application for coverage. A resident is eligible for coverage under 
the plan if evidence is provided of rejection, a requirement of restrictive riders, a rate 
increase or a preexisting conditions limitation on a qualified plan, the effect of which is to 
substantially reduce coverage from that received by a person considered a standard risk 
by at least one insurer belonging to the association within 6 months of the date of the 
certificate, or if the resident meets other eligibility requirements adopted by rule by the 
superintendent that are not inconsistent with this chapter and that indicate that a person is 
unable to obtain coverage substantially similar to that which may be obtained by a person 
who is considered a standard risk. Rules adopted pursuant to this subsection are routine 
technical rules as defined in Title 5, chapter 375, subchapter 2-A. 
2. 
Change of domicile. 
The board shall develop standards for eligibility for 
coverage by the association for any natural person who changes that person's domicile to 
this State and who at the time domicile is established in this State is insured by an 
organization similar to the association. The eligible maximum lifetime benefits for that 
covered person may not exceed the lifetime benefits available through the association, 
less any benefits received from a similar organization in the former domiciliary state. 
3. Eligibility without application. The board shall develop a list of medical or 
health conditions for which a person is eligible for plan coverage without applying for 
health insurance under subsection 1. A person who can demonstrate the existence or 
history of a medical or health condition on the list developed by the board may not be 
required to provide the evidence specified in subsection 1. The board may amend the list 
from time to time as appropriate. 
Page \3- 123LR2620(05)-1 
SENATE AMENDMENT 
: l(ir), 
.,. 
f'~ 
.\{'~. 
SENATE AMENDMENT" 6" to COMMITTEE AMENDMENT "A" to H.P. 1322,L.D.1890 
4. Exclusions from eligibility. A person is not eligible for coverage under the plan 
A. The person has or obtains health insurance coverage substantially similar to or 
more comprehensive than a plan policy or would be eligible to have coverage if the 
person elected to obtain it, except that: 
( 1) A person may maintain other coverage for the period of time the person is 
satisfying a preexisting condition waiting period under a plan policy; and 
(2) A person may maintain plan coverage for the period of time the person is 
satisfying a preexisting condition waiting period under another health insurance 
policy intended to replace the plan policy; 
B. The person is determined eligible for health care benefits under the MaineCare 
program pursuant to Title 22; 
C. The person previously terminated plan coverage, unless 6 months have elapsed 
since the person's last termination; 
D. The person is an inmate or resident of a public institution; or 
E. 
The person's premiums are paid for or reimbursed under any government-
sponsored program or by any government agency or health care provider, except as 
an otherwise qualifying full-time employee, or dependent thereof, of a government 
agency or health care provider. 
5. Termination of coverage. The coverage of any person ceases: 
A. On the date a person is no longer a resident; 
B. Upon the death of the covered person; 
C. On the date state law requires cancellation of the policy; or 
D. At the option of the association, 30 days after the association makes any inquiry 
concerning the person's eligibility or place of residence to which the person does not 
~ 
The coverage of any person who ceases to meet the eligibility requirements of this section 
may be terminated immediately. 
6. Unfair trade practice. It constitutes an unfair trade practice for any insurer, 
producer, employer or 3rd-party administrator to refer an individual employee or a 
dependent of an individual employee to the association or to arrange for an individual 
employee or a dependent of an individual employee to apply to the plan for the purpose 
of separating such an employee or dependent from a group health benefits plan provided 
in connection with the employee's employment. 
§39U. 
Actions against association or members based upon joint or collective 
actions 
Participation in the association, the establishment of rates, forms or procedures or any 
other joint or collective action required by this chapter may not be the basis of any legal 
SENATE AMENDMENT 
-r,-, .. ~. 
SENATE AMENDMENT" ~"to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
action or criminal or civil liability or penalty against the association or any insurer 
belonging to the association. 
Sec. D-3. 
Maine Individual High-risk Reinsurance Pool Association; 
staggered terms. Notwithstanding the Maine Revised Statutes, Title 24-A, section 
3903, subsection 2, paragraph B, the terms for initial appointments to the Maine 
Individual High-risk Reinsurance Pool Association are as follows. Of those members of 
the board appointed by the superintendent, 2 members serve for a term of one year, 2 
members for a term of 2 years and 2 members for a term of 3 years. Of those members 
appointed by insurers, one member serves for a term of one year, one member serves for 
a term of 2 years and one member serves for a term of 3 years. The appointing authority 
shall designate the period of service of each initial appointee at the time of appointment. 
PARTE 
Sec. E-l. 24-A MRS A §2736-C, sub-§2,~, as enacted by PL 1993, c. 477, Pt. 
C, § 1 and affected by Pt. F, § 1, is amended to read: 
B. A carrier may not vary the premium rate due to the gender, health statl:lS, claims 
experience or policy duration of the individual. A carrier may vary the premium rate 
based on health status, age, occupation or industry and geographic area only as 
permitted in paragraph D. 
Sec. E-2. 24-A MRS A §2736-C, sub-§2, ~, as amended by PL 2001, c. 410, 
Pt. A, §2 and affected by § 1 0, is further amended to read: 
D. A carrier may vary the premium rate due to age, health status, occupation or 
industry and geographic area ORty I:IRder the followiRg sehedl:lte aRd withiR tHe listed 
)3ereefltage baRds in accordance with the limitations set out in this paragraph. 
(1) For all policies, contracts or certificates that are executed, delivered, issued 
for delivery, continued or renewed in this State between December 1, 1993 and 
July 14, 1994, the premium rate may not deviate above or below the community 
rate filed by the carrier by more than 50%. 
(2) For all policies, contracts or certificates that are executed, delivered, issued 
for delivery, continued or renewed in this State between July 15, 1994 and July 
14, 1995, the premium rate may not deviate above or below the community rate 
filed by the carrier by more than 33%. 
(3) For all policies, contracts or certificates that are executed, delivered, issued 
for delivery, continued or renewed in this State after July 15, 1995, the premium 
rate may not deviate above or below the community rate filed by the carrier by 
more than 20%. 
(4) For all policies, contracts or certificates that are executed, delivered, issued 
for delivery, continued or renewed in this State after January 1, 2008, the 
maximum rate differential filed by the carrier for age, occupation or industry or 
geographic area as determined by ratio is 4 to one. The limitation does not apply 
for determining rates for an attained age of less than 19 or more than 65 years. 
SENATE AMENDMENT 
Ji~' 
\~'\, ....... 
SENATE AMENDMENT" 8 " 
to COMMITTEE AMENDMENT" A" to H.P. 1322, L.D. 1890 
(5) For all policies, contracts or certificates that are executed, delivered, issued 
for delivery, continued or renewed in this State after January 1, 2008, the 
maximum rate differential filed by the carrier for health status as determined by 
ratio is 1.5 to one. 
(6) A variation in rate is not permitted on the basis of changes in health status 
after a policy, contract or certificate is issued or renewed. 
Sec. E-3. 24-A MRSA §2736-C, sub-§2, ~G is enacted to read: 
G. A carrier that offered individual health plans prior to January 1, 2008 may close 
its individual book of business sold prior to January 1, 2008 and may establish a 
separate community rate for individuals applying for coverage under an individual 
health plan after January 1, 2008. 
PARTF 
Sec. F-l. 24-A MRSA §423-D, sub-§3 is enacted to read: 
3. Report by superintendent. The superintendent shall report each year by March 
st to the joint standing committee of the Legislature having iurisdiction over insurance 
matters on the impact of changes to the rating provisions in section 2736-C and the 
establishment of the Maine Individual High-risk Reinsurance Pool Association pursuant 
to chapter 54, the total number of individuals enrolled in any health insurance product 
regulated by the bureau and the number of previously uninsured individuals who have 
enrolled during that year in any health insurance product regulated by the bureau, which 
information is collected pursuant to rules adopted under this section. 
PARTG 
Sec. G-l. 24-A MRSA §6908, sub-§l, ~, as enacted by PL 2003, c. 469, Pt. A, 
§8, is amended to read: 
K. Provide staff support and other assistance to the Maine Quality Forum established 
in section 6951, including assigning a director and other staff as needed to conduct 
the work of the Maine Quality Forum; ana 
Sec. G-2. 24-A MRSA §6908, sub-§l,~, as enacted by PL 2003, c. 469, Pt. A, 
§8, is amended to read: 
L. In accordance with the limitations and restrictions of this chapter, cause any of its 
powers or duties to be carried out by one or more organizations organized, created or 
operated under the laws of this State.,.; and 
Sec. G-3. 24-A MRSA §6908, sub-§l, ~ 
is enacted to read: 
M. 
Establish and administer grant, subsidy and facilitation programs designed to 
assist providers and health care practitioners in the development, enhancement and 
maintenance of quality improvement infrastructure and processes. Dirigo Health may 
solicit and collect contributions to fund these programs. 
SENATE AMENDMENT 
SENATE AMENDMENT" ~ "to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
PARTH 
Sec. H-1. 24-A MRSA §6908, sub-§l, ~ 
is enacted to read: 
N. 
Provide subsidies for eligible enrollees covered under health benefit plans 
approved by the board pursuant to section 6910, subsection 3, paragraph A that are 
offered by multiple licensed health insurance carriers in the State. 
Sec. H-2. 24-A MRSA §6910, sub-§3, as amended by PL 2005, c. 400, Pt. C, §8, 
is further amended to read: 
3. Carrier participation requirements. To qualify as a carrier of Dirigo Health 
Program coverage, a health insurance carrier must: 
lOA. Provide the comprehensive health services and benefits as determined by the 
II 
board, including a standard benefit package that meets the requirements for mandated 
coverage for specific health services, specific diseases and for certain providers of 
health services under Title 24 and this Title and any supplemental benefits the board 
wishes to make available; and 
B. Ensure that: 
(1) Providers contracting with a carrier contracted to provide coverage to plan 
enrollees do not charge plan enrollees or 3rd parties for covered health care 
services in excess of the amount allowed by the carrier the provider has 
contracted with, except for applicable copayments, deductibles or coinsurance or 
as provided in section 4204, subsection 6; 
(2) Providers contracting with a carrier contracted to provide coverage to plan 
enrollees do not refuse to provide services to a plan enrollee on the basis of 
health status, medical condition, previous insurance status, race, color, creed, age, 
national origin, citizenship status, gender, sexual orientation, disability or marital 
status. This subparagraph may not be construed to require a provider to furnish 
medical services that are not within the scope of that provider's license; and 
(3) Providers contracting with a carrier contracted to provide coverage to plan 
enrollees are reimbursed at the negotiated reimbursement rates between the 
carrier and its provider network. 
Health insurance carriers that seek to qualify to provide Dirigo Health Program coverage 
ffH:lSt may also qualify as health plans in Medicaid. 
Sec. H-3. 24-A MRSA §6910, sub-§4, ~, as amended by PL 2005, c. 400, Pt. 
C, §8, is further amended to read: 
B. 
Dirigo Health shall contract with eligible businesses seeking assistance from 
Dirigo Health in arranging for health benefits coverage by the Dirigo Health Program 
for their employees and dependents as set out in this paragraph. 
(1) 
Dirigo Health may establish contract and other reporting forms and 
procedures necessary for the efficient administration of contracts. 
SENATE AMENDMENT 
~,,,~,,1b. 
SENA TE AMENDMENT ,,~ .. to COMMITTEE AMENDMENT" A" to H.P. 1322, L.D. 1890 
(2) Dirigo Health shall collect payments from participating employers and plan 
enrollees to cover the cost of: 
(a) The Dirigo Health Program for enrolled employees and dependents in 
contribution amounts determined by the board; 
(b) 
Dirigo Health's quality assurance, disease prevention, disease 
management and cost-containment programs; 
(c) Dirigo Health's administrative services; and 
(d) Other health promotion costs. 
(3) Dirigo Health shall establish the minimum required contribution levels, not 
to exceed 60%,. to be paid by employers toward the aggregate payment in 
subparagraph (2) and establish an equivalent minimum amount to be paid by 
employers or plan enrollees and their dependents who are enrolled in MaineCare. 
The minimum required contribution level to be paid by employers must be 
prorated for employees that work less than the number of hours of a full-time 
equivalent employee as determined by the employer. 
Dirigo Health may 
establish a separate minimum contribution level to be paid by employers toward 
coverage for dependents of the employers' enrolled employees. 
(4) Dirigo Health shall require participating employers to certify that at least 
75% of their employees that work 30 hours or more per week and who do not 
have other creditable coverage are enrolled in the Dirigo Health Program and that 
the employer group otherwise meets the minimum participation requirements 
specified by section 2808-B, subsection 4, paragraph A. 
(5) Dirigo Health shall reduce the payment amounts for plan enrollees eligible 
for a subsidy under section 6912 accordingly. Dirigo Health shall return any 
payments made by plan enrollees also enrolled in MaineCare to those enrollees. 
(6) Dirigo Health shall require participating employers to pass on any subsidy in 
section 6912 to the plan enrollee qualifying for the subsidy, up to the amount of 
payments made by the plan enrollee. 
(7) Dirigo Health may establish other criteria for participation. 
(8) Dirigo Health may limit the number of participating employers. 
(9) Dirigo Health may provide participating employers assistance to adopt and 
maintain a payroll deduction program to facilitate the payment of health benefit 
plan premium payments by employees to benefit from deductibility of gross 
income under 26 United States Code, Section 125. 
Sec. H-4. 24-A MRSA §6912, sub-§4, as enacted by PL 2003, c. 469, Pt. A, §8, 
is repealed. 
PART I 
Sec. 1-1. 22 MRSA §1721 is enacted to read: 
Page JS-123LR2620(05)-1 
SENATE AMENDMENT 
~ .. ;,), 
.. 
"'i::"~ 
SENATE AMENDMENT" ~ " to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
§1721. Voluntary restraint 
1. Voluntary restraint. To control the rate of growth of the costs of hospital 
services, each hospital licensed under chapter 405 may voluntarily restrain cost increases 
and consolidated operating margins in accordance with this section. Each hospital shall 
annually report to the joint standing committee of the Legislature having jurisdiction over 
health and human services matters regarding its efforts made pursuant to this section. 
The targets and methodology apply to each hospital's fiscal year beginning on or after 
July 1, 2008. 
A. Each hospital may voluntarily hold its consolidated operating margin to no more 
than 3%. For purposes of this section, a hospital's consolidated operating margin is 
calculated by dividing its consolidated operating income by its total consolidated 
operating revenue. 
B. Each hospital may voluntarily restrain its increase in its expense per casemix-
adjusted inpatient and volume-adjusted outpatient discharge to no more than 110% of 
the forecasted increase in the hospital market basket index for the coming federal 
fiscal year, as published in the Federal Register, when the federal Centers for 
Medicare and Medicaid Services publishes the Medicare program's hospital inpatient 
prospective payment system rates for the coming federal fiscal year. For purposes of 
this paragraph, the measure of a hospital's expense per casemix-adjusted inpatient and 
volume-adjusted outpatient discharge is calculated by: 
(1) Calculating the hospital's total hospital-only expenses; 
(2) Subtracting from the hospital's total hospital-only expenses the amount of the 
hospital's bad debt; 
(3) Subtracting from the amount reached in subparagraph (2) the hospital taxes 
paid to the State during the hospital's fiscal year; and 
(4) Dividing the amount reached in subparagraph (3) by the product of: 
(a) The number of inpatient discharges, adjusted by the all payer case mix 
index for the hospital: and 
(b) The ratio of total gross patient service revenue to gross inpatient service 
revenue. 
For the purposes of this paragraph, a hospital's total hospital-only expenses include 
any item that is listed on the hospital's Medicare cost report as a subprovider, such as 
a psychiatric unit or rehabilitation unit, and does not include nonhospital cost centers 
shown on the hospital's Medicare cost report, such as home health agencies, nursing 
facilities, swing beds, skilled nursing facilities and hospital-owned physician 
practices. For purposes of this paragraph, a hospital's bad debt is as defined and 
reported in the hospital's Medicare cost report and as submitted to the Maine Health 
Data Organization pursuant to Title 22, chapter 1683. 
SENATE AMENDMENT 
SENATE AMENDMENT" ~ .. to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
PARTJ 
Sec. J-l. 24-A MRSA §2736, sub-§3, ~, as amended by PL 2003, c. 469, Pt. E, 
§9, is further amended to read: 
B. 
The insurer must demonstrate in accordance with generally accepted actuarial 
principles and practices consistently applied that, as of a date no more than 210 days 
prior to the filing, the ratios of benefits incurred to premiums earned for those 
products average no less than 80% for the previous 12-month period. 
For the 
purposes of this ealeulatiofl, any saviflgs offset paymeflts paid pursuaflt to sectiofl 
6913 must be treated as iflcurred elaims. 
Sec. J-2. 24-A MRSA §2736, sub-§4, ,C, as amended by PL 2003, c. 469, Pt. 
E, § 1 0, is further amended to read: 
C. In any hearing conducted under this subsection, the Bureau of Insurance and any 
party asserting that the rates are excessive have the burden of establishing that the 
rates are excessive. The burden of proving that rates are adequate, and not unfairly 
discriminatory afld ifl compliaRee 'NitR tRe requirements of section 6913 remains with 
the insurer. 
Sec. J-3. 24-A MRSA §2736-A, first ~, as amended by PL 2003, c. 469, Pt. E, 
§ 11, is further amended to read: 
If at any time the superintendent has reason to believe that a filing does not meet the 
requirements that rates not be excessive, inadequate; and unfairly discriminatory or f10t ifl 
compliance with seetiofl 6913 or that the filing violates any of the provisions of chapter 
23, the superintendent shall cause a hearing to be held. 
Sec. J-4. 24-A MRSA §2736-C, sub-§2,~, as enacted by PL 2003, c. 469, Pt. 
E, § 12, is repealed. 
Sec. J-S. 24-A MRSA §2736-C, sub-§S, as amended by PL 2003, c. 469, Pt. E, 
§ 13, is further amended to read: 
5. Loss ratios. For all policies and certificates issued on or after the effective date of 
this section, the superintendent shall disapprove any premium rates filed by any carrier, 
whether initial or revised, for an individual health policy unless it is anticipated that the 
aggregate benefits estimated to be paid under all the individual health policies maintained 
in force by the carrier for the period for which coverage is to be provided will return to 
policyholders at least 65% of the aggregate premiums collected for those policies, as 
determined in accordance with accepted actuarial principles and practices and on the 
basis of incurred claims experience and earned premiums. For the pUFfloses of this 
calculation, aflY savings offset payments paid purseaflt to section 6913 mest be treated as 
incerTed claims. 
Sec. J-6. 24-A MRSA §2S0S-B, sub-§2-A, ,C, as enacted by PL 2003, c. 469, 
Pt. E, § 16, is amended to read: 
C. Rates for small group health plans must be filed in accordance with this section 
and subsections 2-B and 2-C for premium rates effective on or after July 1, 2004, 
except that the filing of rates for small group healtJ-l plafls are f10t required to accouflt 
SENATE AMENDMENT 
,~ . 
.. ", . 
"i'<' 
I 
IS 
SENATE AMENDMENT" 6 " 
to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
for an)' savings offset payment or an)' recovery of tflat offset payment pliFsuant to 
subsection 2 E, paragraph D and section 6913 for rates effective before July 1, 2005. 
Sec. J-7. 24-A MRSA §2S0S-B, sub-§2-B, ~A, as enacted by PL 2003, c. 469, 
Pt. E, § 16, is amended to read: 
A. 
The superintendent shall disapprove any premium rates filed by any carrier, 
whether initial or revised, for a small group health plan unless it is anticipated that the 
aggregate benefits estimated to be paid under all the small group health plans 
maintained in force by the carrier for the period for which coverage is to be provided 
will return to policyholders at least 75% of the aggregate premiums collected for 
those policies, as determined in accordance with accepted actuarial principles and 
practices and on the basis of incurred claims experience and earned premiums. Fef 
the pllrposes of this calculation, any savings offset payments paia pursuant to section 
6913 ml:lst be treatea as incl:lrred claims. 
Sec. J-S. 24-A MRS A §2S0S-B, sub-§2-B, ~, as enacted by PL 2003, c. 469, 
Pt. E, § I 6, is repealed. 
Sec. J-9. 24-A MRSA §2S0S-B, sub-§2-B, V, as enacted by PL 2003, c. 469, 
Pt. E, § I 6, is amended to read: 
F. 
Any rate hearing conducted with respect to filings that meet the criteria in 
paragraph E is subject to this paragraph. 
(I) A person requesting a hearing shall provide the superintendent with a written 
statement detailing the circumstances that justify a hearing, notwithstanding the 
satisfaction of the criteria in paragraph E. 
(2) If the superintendent decides to hold a hearing, the superintendent shall issue 
a written statement detailing the circumstances that justify a hearing, 
notwithstanding the satisfaction of the criteria in paragraph E. 
(3) In any hearing conducted under this paragraph, the bureau and any party 
asserting that the rates are excessive have the burden of establishing that the rates 
are excessive. The burden of proving that rates are adequate, and not unfairly 
discriminatory ana in compliance with the requirements of section 6913 remains 
with the carrier. 
Sec. J-IO. 24-A MRSA §2839-B, sub-§2, as enacted by PL 2003, c. 469, Pt. E, 
§ 17, is amended to read: 
2. 
Annual filing. 
Every carrier offering group health insurance specified in 
subsection I shall annually file with the superintendent on or before April 30th a 
certification signed by a member in good standing of the American Academy of 
Actuaries or a successor organization that the carrier's rating methods and practices are in 
accordance with generally accepted actuarial principles and with the applicable actuarial 
standards of practice as promulgated by an actuarial standards board. The filing ml:lst 
also certify that the carrier has incl\:laed in its experience &fly savings offset payments or 
recovery of those savings offset payments consistent ,>vith section 6913. The filing also 
must state the number of policyholders, certificate holders and dependents, as ofthe close 
of the preceding calendar year, enrolled in large group health insurance plans offered by 
SENATE AMENDMENT 
"1>-. 
~ p' 
0..J'~ 
I 
SENATE AMENDMENT" S " 
to COMMITTEE AMENDMENT" A" to H.P. 1322, L.D. 1890 
the carrier. A filing and supporting information are public records except as provided by 
Title 1, section 402, subsection 3. 
Sec. J-ll. 24-A MRSA §6908, sub-§2, ~, as enacted by PL 2003, c. 469, Pt. 
A, §8, is repealed. 
Sec. J-12. 24-A MRSA §6913, as amended by PL 2005, c. 683, Pt. A, §§43 and 
44, is repealed. 
Sec. J-13. 24-A MRSA §6915, as amended by PL 2005, c. 386, Pt. D, §3, is 
further amended to read: 
§6915. Dirigo Health Enterprise Fund 
The Dirigo Health Enterprise Fund is created as an enterprise fund for the deposit of 
any funds advanced for initial operating expenses, payments made by employers and 
individuals, any savings offset payments made pl:lrsl:lant to seetion 6913 any funds 
appropriated from the General Fund and any funds received from any public or private 
source. The fund may not lapse, but must be carried forward to carry out the purposes of 
this chapter. 
Sec. J-14. 24-A MRSA §6951, first~, as enacted by PL 2003, c. 469, Pt. A, §8, 
is amended to read: 
The Maine Quality Forum, referred to in this subchapter as "the forum," is 
established within Dirigo Health. The forum is governed by the board with advice from 
the Maine Quality Forum Advisory Council pursuant to section 6952. The forum must be 
funded, at least in part, through the savings offset p8)'ments made pl:Irsuant to seetion 
@.J.J. within the limitations of available funds. Except as provided in section 6907, 
subsection 2, information obtained by the forum is a public record as provided by Title 1, 
chapter 13, subchapter 1. The forum shall perform the following duties. 
PARTK 
Sec. K-l. 24-A MRSA §2735-A, sub-§l, as enacted by PL 2001, c. 432, §4, is 
amended to read: 
1. Notice of rate filing or rate increase on existing policies. An insurer offering 
individual health plans as defined in section 2736-C must provide written notice by first 
class mail of a rate filing to all affected policyholders at least 60 days before the effective 
date of any proposed increase in premium rates or any proposed rating formula, 
classification of risks or modification of any formula or classification of risks. The notice 
must also inform policyholders of their right to request a hearing pursuant to section 229 
or a speeial rate hearing pl:Irsl:Iant to sestion 2736, sl:lbseetioR 4 or Title 24, sestion 2321, 
sl:lBseetion 5. The notice must show the proposed rate and state that the rate is subject to 
regulatory approval. The superintendent may not take final action on a rate filing until 40 
days after the date notice is mailed by an insurer. An increase in premium rates may not 
be implemented until 60 days after the notice is provided or until the effective date under 
section 2736, whichever is later. 
SENATE AMENDMENT 
:f. ~). 
if·· . 
I 
SENATE AMENDMENT" 6" to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
Sec. K-2. 24-A MRSA §2736, sub-§l, as amended by PL 2003, c. 428, Pt. F, §2, 
is further amended to read: 
1. Filing of rate information. Every insurer shall file with the superintendent every 
rate, rating formula, classification of risks and every modification of any formula or 
classification that it proposes to use in connection with individual health insurance 
policies and certain group policies specified in section 2701. Every such filing must state 
the effective date of the filing. Every such filing must be made not less than 60 days in 
advance of the stated effective date, unless the 60-day requirement is waived by the 
superintendent, and the effective date may be suspended by the superintendent for a 
period of time not to exceed 30 days. In the ease of a filing that meets the eriteria in 
sl:lBseetion 3, the sl:lperintendent ma)' suspend the effeetive date for a longer period not to 
exeeed 30 days from tAe date the organiZiation satisfaetorily responds to any reasonaBle 
diseovery reql:lests. ' , 
SUMMARY 
This amendment strikes out all of the committee amendment and accomplishes all of 
the following. 
Part A requires carriers to offer a wellness program in all small group and group 
health plans. The Part requires that carriers offer enrollees participating in the wellness 
program a financially tangible benefit, including a premium discount. The Part also 
requires that carriers report annually to the Superintendent of Insurance about the 
wellness programs offered to enrollees and that the superintendent report aggregate data 
from carriers to the Legislature and to the Maine Quality Forum. 
Part B requires that all insurers in the individual market offer a plan that includes a 
$1,000 deductible, a prescription drug benefit not subject to a deductible and the option of 
no cap on the lifetime maximum benefit. 
Part C extends the provision allowing carriers to lower premium costs by including 
financial incentives to members to use designated providers and gives the Superintendent 
of Insurance the authority to develop a financial incentive pilot program that allows 
companies to offer products in which consumers can choose to travel further for cost 
savings and better quality. 
Part D establishes a reinsurance pool for the individual health insurance market and is 
modeled on a similar reinsurance pool in Idaho. The Part requires insurers that provide 
medical insurance as defined in the bill to pay an assessment of up to $2 per covered 
person per month to partially support the costs of the reinsurance pool. The Part requires 
all individual carriers to guarantee issue of all health plans approved by the high-risk 
reinsurance pool as a condition of offering individual health plans in this State. 
Part E allows a maximum rate differential for individual health plans on the basis of 
age, occupation or industry and geographic area of 4: I and a maximum rate differential 
on the basis of health status and tobacco use of 1.5: 1. 
Part F requires the Superintendent of Insurance to report yearly to the Legislature the 
impact of changes to the rating provisions in Title 24-A, section 2736-C and the 
establishment ofthe Maine Individual High-risk Reinsurance Pool pursuant to Title 24-A, 
SENATE AMENDMENT 
c, ~j' 
t· 
< .. 
I 
SENATE AMENDMENT"~ "to COMMITTEE AMENDMENT "A" to H.P. 1322, L.D. 1890 
chapter 54, the total number of individuals enrolled in any health insurance product 
regulated by the Bureau of Insurance and the numbers of previously uninsured 
individuals who have enrolled in any health insurance product regulated by the Bureau of 
Insurance. 
Part Gallows Dirigo Health to administer grants and other subsidies to strengthen the 
State's health care quality improvement infrastructure. 
Part Hallows Dirigo Health to subsidize approved plans provided by multiple 
carriers. 
This Part allows Dirigo Health to assist employers in establishing payroll 
deduction systems that would help employees purchase health coverage with pre-tax 
dollars. 
Part I makes permanent, beginning on or after July 1, 2008, the temporary voluntary 
cost containment targets on hospital consolidated operating margins and cost increases, 
which were initiated in Public Law 2003, chapter 469, Part F, section 1 and which 
otherwise would expire. 
Part J repeals the savings offset payment as a source of funding for Dirigo Health. 
Part K corrects cross-references. 
SPONSORED BY: ~ 
t!t~tfl.L n~ 
(Senator SNOWE-MELLO) 
COUNTY: Androscoggin 
SENATE AMENDMENT 
Approved: 06/19107 
LD 1890 
LR 2620(05) 
An Act To Make Health Care Affordable, Accessible and Effective for AIJ 
Fiscal Note for Senate Amendment" 6 " to Committee Amendment "A" 
Sponsor: Sen. Snowe-Mello of Androscoggin 
Net Cost (Savings) 
General Fund 
Appropriations/Allocations 
General Fund 
Other Special Revenue Funds 
Dirigo Health Fund 
Maine Individual Reinsurance 
Program Fund 
Revenue 
General Fund 
Other Special Revenue Funds 
Dirigo Health Fund 
Transfers 
Dirigo Health Fund 
Maine Individual Reinsurance 
Program Fund 
Fiscal Detail and Notes 
Fiscal Note Required: Yes 
Fiscal Note 
2007-08 
$1,036,716 
($88,000) 
($273,859) 
2008-09 
$1,513,335 
$0 
($183,279) 
Projections 
2009-10 
$1,499,884 
$0 
($192,390) 
Projections 
2010-11 
$1,488,169 
$0 
($202,002) 
($35,649,622) 
($44,811,247) 
($24,272,863) 
($24,319,644) 
$0 
($18,483,552) 
($18,496,694) 
($18,511,467) 
($1,124,716) 
($60,443) 
($1,513,335) 
($81,328) 
($1,499,884) 
($82,272) 
($1,488,169) 
($81,630) 
($35,649,622) 
($77,014,799) 
($77,069,557) 
($77,131,111) 
$0 
$18,483,552 
$18,496,694 
$18,511,467 
$0 
($18,483,552) 
($18,496,694) 
($18,511,467) 
The amendment retains the repeal ofthe Savings Offset Payment but eliminates the increase in the tobacco tax and the 
new hospital surcharge. Without the increase in the tobacco tax, the amendment does not increase General Fund 
revenue by $1,124,716 in fiscal year 2007-08 and $1,513,335 in fiscal year 2008-09 due to an increase in sales tax 
resulting from the increase in the tobacco taxes, and therefore, the amendment has a net General Fund cost. 
LR2620(05) - Fiscal Note - Page 1 of2 
The amendment would not create the Maine Individual Reinsurance Program within the Department of Professional 
and Financial Regulation. The amendment does create the Maine Individual High-Risk Reinsurance Pool Association, 
but does so as a non-profit non-governmental legal entity so the resulting costs and assessment do not have a state 
fiscal impact. 
The amendment would eliminate the need for additional allocations and the creation of positions in the Bureau of 
Insurance with any remaining costs absorbed utilizing existing resources. 
The remaining fiscal impact of the bill as amended is as follows: 
Dirigo Health Fund Summary 
Revenue Changes: 
Elimination of the Savings Offset Payment 
2007-08 
$0 
2008-09 
($13,720,000) 
LR2620(05) - Fiscal Note - Page 2 of2 
Projections 
2009-10 
($34,300,000) 
Projections 
2010-11 
($34,300,000)