An Act To Require Advance Review and Approval of Certain Small Group Health Insurance Rate Increases and To Implement the Requirements of the Federal Patient Protection and Affordable Care Act
Maine Legislature, Session 125, LD 1179
Committee Amendment CA_A_H725 (House)
Amends: 24-A MRSA §2736-C, 24-A MRSA §2

COMMITTEE AMENDMENT "A " to H.P. 877, L.D. 1179, Bill, "An Act To 
Require Advance Review and Approval of Certain Small Group Health Insurance Rate 
Increases and To Implement the Requirements of the Federal Patient Protection and 
Affordable Care Act" 
Amend the bill by striking out the title and substituting the following: 
'An Act To Restore Advance Review and Prior Approval for Individual Health 
Insurance Rates and Extend the Same Process to Small Groups' 
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 §2736-C, sub-§2-B, as amended by PL 2011, c. 364, §7, 
is further amended to read: 
2-B. Rate filings; credible health plans. Notwithstanding section 2736, subsection 
and section 2736 A, at the carrier's option, rate Rate filings for a carrier's credible block 
of individual health plans may must be filed in accordance with this subsection. R:atss 
filed in accordance with this subsection are filed for informational pUi"poses unless rate 
review is required pursuant to the federal Affordable Care Act. 
A. 
A carrier's individual health plans are considered credible if the anticipated 
average number of members during the period for which the rates will be in effect 
meets standards for full or partial credibility pursuant to the federal Affordable Care 
Act. The rate filing must state the anticipated average number of members during the 
period for which the rates will be in effect and the basis for the estimate. If-.the 
superintendent determines that the flUfllber of members is likely to be less than 
needed to meet the credibility standard, the filing is subject to section 2736, 
subsection 1 and section 2736 i'L 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT "A" to H.P, 877, L.D, 1179 
B. On an annual schedule as determined by the superintendent, the carrier shall file a 
report with the superintendent showing the calculation of rebates as required pursuant 
to the federal Affordable Care Act, except that the calculation must be based on a 
minimum medical loss ratio of 80% if the applicable federal minimum for the 
individual market in this State is lower. If the calculation indicates that rebates must 
be paid, the carrier must pay the rebates in the same manner as is required for rebates 
pursuant to the federal Affordable Care Act. 
Sec. A-2. 24-A MRSA §2736-C, sub-§5, as amended by PL 2011, c, 90, Pt. D, 
§3, is further amended to read: 
5. Loss ratios. Except as provided in soosection 2 D, for 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 purposes of this calculation, any payments paid pursuant 
to former section 6913 must be treated as incurred claims. 
PARTB 
Sec. B-1. 24-A MRSA §2S0S-B, sub-§2-A, ,C, as amended by PL 2007, c. 
629, Pt. M, §6, is further amended to read: 
C. Rates for small group health plans must be filed in accordance with this section 
and subsections 2 D and 2 C for premium rates effective on or after July 1, 2004, 
except that the filing of rates for small group health plans are not required to account 
for any payment or any reco'fery of that payment pursuant to subsection 2 D, 
paragraph D and former section 6913 for rates effective before July 1, 2005. 
Sec. B-2. 24-A MRSA §2S0S-B, sub-§2-B, as amended by PL 2011, c. 364, 
§15, is further amended to read: 
2-B. Rate review and hearings. E](cept as provided in subsection 2 C, rate Rate 
filings are subj ect to this subsection. 
A. Rates subject to this subsection must be filed for approval by the superintendent. 
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. For 
the purposes of this calculation, any payments paid pursuant to former section 6913 
must be treated as incurred claims. 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT "A" to H.P. 877, L.D. 1179 
B. If at any time the superintendent has reason to believe that a filing does not meet 
the requirements that rates not be excessive, inadequate or unfairly discriminatory or 
that the filing violates any of the provisions of chapter 23, the superintendent shall 
cause a hearing to be held. Hearings held under this subsection must conform to the 
procedural requirements set forth in Title 5, chapter 375, subchapter 4. If a filing 
proposes an increase in rates in a small group health plan, the superintendent shall 
cause a hearing to be held at the request of the Attorney GeneraL In any hearing 
conducted under this paragraph, the insurer has the burden of proving rates are not 
excessive, inadequate or unfairly discriminatory. The superintendent shall issue an 
order or decision within 30 days after the close of the hearing or of any rehearing or 
reargument or within such other period as the superintendent for good cause may 
require, but not to exceed an additional 30 days. 
In the order or decision, the 
superintendent shall either approve or disapprove the rate filing. If the superintendent 
disapproves the rate filing, the superintendent shall establish the date on which the 
filing is no longer effective, specify the filing the superintendent would approve and 
authorize the insurer to submit a new filing in accordance with the terms of the order 
or decision. 
C. When a filing is not accompanied by the information upon which the carrier 
supports the filing or the superintendent does not have sufficient information to 
determine whether the filing meets the requirements that rates not be excessive, 
inadequate or unfairly discriminatory, the superintendent shall require the carrier to 
furnish the infonnation upon which it supports the filing. 
D. A carrier that adjusts its rate shall account fer the savings offset payment or any 
recovery of that savings offset payment in its eJtperience consistent with this section 
and fenner section 6913. 
Sec. B-3. 24-A MRSA §2S0S-B, sub-§2-C, as amended by PL 2011, c. 364, 
§ 16, is repealed. 
Sec. B-4. Contingent effective date. This Part takes effect on the date on which 
the United States Supreme Court overturns the federal Patient Protection and Affordable 
Care Act, Public Law 111-148, as amended by the federal Health Care and Education 
Reconciliation Act of 20 1 0, Public Law 111-152, in whole or in part, or the federal law is 
repealed, in whole or in part.' 
SUMMARY 
This amendment replaces the bill and is the minority report of the committee. The 
amendment restores the statutory process for advance review and prior approval of 
individual health insurance rates and repeals the changes to the rate review process for 
individual health insurance made by Public Law 2011, chapter 90. 
The amendment also extends the same process for advance review and prior approval 
for small group health insurance rates, but makes those provisions contingent on the 
repeal of the federal Patient Protection and Affordable Care Act by Congress or the 
invalidation of the federal law by the United States Supreme Court, either in whole or in 
part. 
COMMITTEE AMENDMENT 
Approved: 02/21112 
~.tZC 
LD 1179 
LR 873(02) 
An Act To Require Advance Review and Approval of Certain Small Group Health Insurance Rate 
Increases and To Implement the Requirements ofthe Federal Patient Protection and Affordable Care 
Act 
Fiscal Note for Bill as Amended by Committee Amendment ';4" eN A 7 J5 ) 
Committee: Insurance and Financial Services 
Fiscal Note Required: Yes 
Fiscal Note 
Minor cost increase - Other Special Revenue Funds 
Fiscal Detail and Notes 
Additional costs to the Bureau of Insurance in the Department of Professional and Financial Regulation can be 
absorbed by the bureau within existing budgeted resources. 
LR0873(02) - Fiscal Note - Page 1 of 1