An Act To Maintain Compliance of Maine's Insurance Laws with National Standards
Maine Legislature, Session 124, LD 1510
Committee Amendment CA_A_H628 (House)
Amends: 24-A MRSA §952-A, 24-A MRSA §64

COMMITTEE AMENDMENT ,,/1 " to H.P. 1059, L.D. 1510, Bill, "An Act To 
Maintain Compliance of Maine's Insurance Laws with National Standards" 
Amend the bill in Part A in section 5 in paragraph C in subparagraph (I) by striking 
out all of division (a) (page 2, lines 17 to 19 in L.D.) and inserting the following: 
lea) Exceeds the greater of 10% of the insurer's surplus to policyholders as of 
December 31 st of the preceding year and the net gain from operations for the 
preceding calendar year;' 
Amend the bill in Part B by striking out all of section I and inserting thefollowing: 
'Sec. B-1. 24-A MRSA §952-A, sub-§5 is enacted to read: 
5. Applicability to health carriers. A health carrier not otherwise subject to this 
section or section 993 shall file an actuarial opinion in accordance with the applicable 
National Association of Insurance Commissioners annual statement instructions. 
For 
purposes of this section, "health carrier" means an insurer, health maintenance 
organization, nonprofit corporation subject to Title 24 or fraternal benefit society that 
provides health insurance or comparable health benefits. This section and rules adopted 
pursuant to this section apply to health carriers to the extent that they specifically refer to 
health carriers or impose requirements that are consistent with and no more stringent than 
the annual statement instructions.' 
Amend the bill by inserting after Part C the following: 
'I)ART D 
Sec. D-l. 24-A MRS A §2849-B, sub-§4-A, as enacted by PL 1997, c. 445, §27 
and affected by §32, is amended to read: 
4-A. Alternative method. The superintendent may adopt rules that substitute for the 
requirement of subsection -4- 3-A a requirement that prohibits application of a medical 
underwriting or preexisting condition exclusion with respect to classes or categories of 
benefits that are covered under the replaced contract or policy. The rules must define 
Page I - 124LR2199(02)-1 
COMMITTEE AMENDMENT 
COMMrITEE AMENDMENT "A" to I-J.P. 1059, L.D. 1510 
I 
those classes or categories consistent with any federal regulations adopted pursuant to the 
federal Public Health Service Act, Title XXVII, Section 2701(c)(3)(B). 
PART E 
Sec. E-l. 24-A MRSA §64S1-A, as enacted by PL 1999, c. 113, §24, is repealed 
and the following enacted in its place: 
§6451-A. Applicability to other health organizations 
This chapter applies to fraternal benefit societies authorized to do business in this 
State pursuant to section 4124, to health maintenance organ izations authorized to do 
business in this State pursuant to section 4204 and to nonprofit hospital or medical 
service organizations authorized to do business in this State pursuant to Title 24, section 
II 
2305. 
1. Fratcmal benefit societies. Fraternal benefit societies providing life or annuity 
benefits are subject to the provisions of this chapter applicable to life or health insurers. 
2. Other licensees. Health maintenance organizations and nonprofit hospital or 
medical service organizations are considered health organizations for purposes of this 
chapter. Except as otherwise exwessly provided in this chapter, health organizations are 
subject to the provisions of this chapter applicable to property and casualty insurers. 
Sec. E-2. 24-A MRSA §64S3, sub-§l, '1TA, as amended by PL 1997, c. 81, §7, is 
. 
fUliher amended to rearl: 
A. The filing of a risk-based capital repmi by an insurer that indicates that: 
(I) The insurer's total adjusted capital is greater than or equal to its regu latory 
action level risk-based capital but less than its company action level risk-based 
capital; or 
(2) A life or health The insurer has total adjusted capital that is greater than or 
equal to its company action level risk-based capital but less than the product of its 
authorized control level rislHnlsed capital and 2.5 and has a negative trend;-, if its 
total adjusted capital is less than the product of its authorized control level risk-
based capital and: 
Ca) If the insurer is a life or health insurer, 2.5; or 
Cb) If the insurer is ahealth organization as described in section 6451-A, 
subsection 2,3.0;' 
SUMMARY 
This amendment makes the following changes to the bill. 
I. 
It amends the bill in Part A to correct the mathematical formula for the 
extraordinary dividend threshold and to clarify the applicable time period. 
2. 
It amends the bill in Pari B to clarify the extent to which the life insurance 
actuarial opinion requirements are extended to health insurers. 
COMMITTEE AMENDMENT 
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COMMITfEE AlVIENDMENT "A" to 1-1.1'. 1059, L.D. 1510 
3. It adds PaIt D to the bill to correct a cross-reference in the rulemaking provision of 
the continuity of coverage law. 
4. It adds Part E to the bill to establish a risk-based capital trend test to enhance the 
solvency regulation of health organizations. It also clarifies the application of certain 
provisions to health organizations. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Approved: 02104/ I 0 
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LD 1510 
LR 2199(02) 
An Act To Maintain Compliance of Maine's Insurance Laws with National Standards 
Fiscal Detail and Notes 
. Fiscal Note for Bill as Amended by Committee Amendment'/J." 
Committee: Insurance and Financial Services 
Fiscal Note Required: Yes 
Fiscal Note 
Minor cost increase - Other Special Revenue Funds 
Additional costs to the Bureau of Insurance in the Department of Professional and Financial Regulalion can be 
absorbed by the bureau utilizing exiting budgeted resources. 
LR2199(02) - Fiscal Note - Page I of I 
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