An Act To Correct Inconsistencies and Ambiguities in the Maine Guaranteed Access Reinsurance Association Act
Maine Legislature, Session 125, LD 1702
Committee Amendment CA_B_H848 (House)
Amends: 1 MRSA §402, 24-A MRSA §2736-C, 24-A MRSA §3953, 24-A MRSA §3955, 24-A MRSA §3957, 24-A MRSA §3958, 24-A MRSA §3959, 24-A MRSA §3961

COMMITTEE AMENDMENT "13,, to H.P. 1254, L.D. 1702, Bill, "An Act To 
Correct Inconsistencies and Ambiguities in the Maine Guaranteed Access Reinsurance 
Association Act" 
Amend the bill by striking out everything after the enacting clause and before the 
summary and inserting the following: 
'Sec. 1. 1 MRS A §402, sub-§2, ~, as amended by PL 2009, c. 334, §2, is further 
amended to read: 
F. 
Any advisory organization, including any authority, board, commission, 
committee, council, task force or similar organization of an advisory nature, 
established, authorized or organized by law or resolve or by Executive Order issued 
by the Governor and not otherwise covered by this subsection, unless the law, resolve 
or Executive Order establishing, authorizing or organizing the advisory organization 
specifically exempts the organization from the application of this subchapter; and 
Sec. 2. 1 MRSA §402, sub-§2, ~G, as enacted by PL 2009, c. 334, §3, is 
amended to read: 
G. The committee meetings, subcommittee meetings and full membership meetings 
of any association that: 
(1) Promotes, organizes or regulates statewide interscholastic activities in public 
schools or in both public and p~ivate schools; and 
(2) Receives its funding from the public and private school members, either 
through membership dues or fees collected from those schools based on the 
number of participants of those schools in interscholastic activities. 
This paragraph applies to only those meetings pertaining to interscholastic sports and 
does not apply to any meeting or any portion of any meeting the subject of which is 
limited to personnel issues, allegations of interscholastic athletic rule violations by 
member schools, administrators, coaches or student athletes or the eligibility of an 
individual student athlete or coach~; and 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT]" to H.P. 1254, L.D. 1702 
Sec.3. 1 MRSA §402, sub-§2, ~ 
is enacted to read: 
H. 
The meetings of the Board of Directors of the Maine Guaranteed Access 
Reinsurance Association established in Title 24-A, chapter 54-A. 
Sec.4. 24-A MRSA §2736-C, sub-§3, as amended by PL 2011, c. 90, Pt. B, §6 
and affected by § 10, is further amended to read: 
3. Guaranteed issuance and guaranteed renewal. Carriers providing individual 
health plans must meet the following requirements on issuance and renewal. 
A. Coverage must be guaranteed to all residents of this State other than those eligible 
without paying a premium for Medicare Part A and may be reinsl:lred tflrOl:lgH tHe 
Maine Gl:laraateed Aeeess Reiftsl:lraaee Assoeiatioft establisHed pl:lrsl:laat to eHapter 
~. Oft or after July 1,2012, 6o'lerage 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, 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 4301-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 if 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 
(b) The carrier is applying this provision uniformly to individuals and groups 
without regard to any health-related factor. 
A carrier that denies coverage in accordance with this paragrapH subparagraph 
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, pursuant to section 2850-B. 
C. A carrier is exempt from the guaranteed issuance requirements of paragraph A 
provided that the following requirements are met. 
(1) The carrier does not issue or deliver any new individual health plans on or 
after the effective date of this 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. 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT J3" to H.P. 1254, L.D. 1702 
D. Notwithstanding paragraph A, carriers offering supplemental coverage for the 
Civilian Health and Medical Program for the Uniformed Services, CHAMPUS, are 
not required to issue this coverage if the applicant for insurance does not have 
CHAMPUS coverage. 
E. A As part of the application process for individual health coverage, a carrier may 
evaluate tfle HealtH status of shall require an individual for purposes of desigRatiRg 
tflat iRdividual for reiRsuraRce tflrougH the MaiRe GuaraRteee Access ReiRsurance 
AssociatioR established iR chapter 54 A. For iRdividual healtfl plaRs issuee OR or 
after Jaly 1,2012, tfle carrier shall use to complete the health statement developed by 
the Board of Directors of the Maine Guaranteed Access Reinsurance Association 
pursuant to section 3955, subsection 1, paragraph E to make a desigRatioR aRd may 
ROt use any otfler metflod to determiRe the health status of aR iReividual. For purposes 
of tflis subsectioR, "health statemeRt" meaRS aRY iRformatioR iRteRded to iRform the 
carri er or aR iRsurance producer actiRg OR behalf of a carrier of the healtl'! status of an 
eRrollee or prospective enrollee iR aR iRdividual health plan. A carrier may not deny 
coverage or refuse to renew or cancel an individual health plan on the basis of an 
individual's complete or incomplete health statement, claims history or risk scores or 
on the basis of any omission of material information from a health statement or 
misrepresentation of an individual's health status. The rejection of an application for 
individual health coverage by a carrier because an individual has not submitted a 
completed health statement is not a denial of coverage for the purposes of this 
paragraph. 
Sec. 5. 24-A MRSA §3953, sub-§2, ~ 
is enacted to read: 
E. The board shall establish regular places and times for meetings and may also meet 
at other times at the call of the chair. 
All meetings of the board are public 
proceedings as defined in Title 1, section 402, subsection 2, and meetings must be 
conducted in accordance with Title 1, chapter 13, subchapter 1. 
Sec. 6. 24-A MRSA §3955, sub-§l,~, as enacted by PL 2011, c. 90, Pt. B, §8, 
is amended to read: 
E. Develop a health statement to be used by a member iRsurer to desigRate a resideRt 
in evaluating a person for designation for reinsurance pursuant to section 3959~ 
Protected health information included in a health statement submitted to the 
association that is covered by the federal Health Insurance Portability and 
Accountability Act of 1996, Public Law 104-191, 110 Stat. 1936 or covered by 
chapter 24 remains confidential and is not open to public inspection; and 
Sec.7. 24-A MRSA §3957, sub-§5, ~B, as enacted by PL 2011, c. 90, Pt. B, §8, 
is repealed. 
Sec. 8. 24-A MRS A §3958, sub-§l, ~A, as enacted by PL 2011, c. 90, Pt. B, §8, 
is amended to read: 
A. +He Beginning July 1, 2012, the association may Rot shall reimburse a member 
insurer for claims incurred with respect to claims of a person designated for 
reinsurance by the member insurer pursuant to section 3959 URtil or 3961 after the 
insurer has incurred an initial level of claims for that person of $7,500 for covered 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT~" to H.P. 1254, L.D. 1702 
benefits in a calendar year. In addition, the insurer is responsible for 10% of the next 
$25,000 of claims paid during a calendar year. The asseeiatieR sHall reimburse 
iRsurers fer claims paid amount of reimbursement is 90% of the amount incurred 
between $7,500 and $32,500 and 100% of the amount incurred in excess of $32,500 
for claims incurred in that calendar year with respect to that person. For calendar 
year 2012, only claims incurred on or after July 1st are considered in determining the 
member insurer's reimbursement. The association may annually adjust the initial 
level of claims and the maximum limit to be retained by the insurer to reflect 
increases in costs and utilization within the standard market for individual health 
plans within the State. The adjustments may not be less than the annual change in the 
Consumer Price Index for medical care services unless the superintendent approves a 
lower adjustment factor as requested by the association. 
Sec. 9. 24-A MRSA §3958, suh-§2, as enacted by PL 2011, c. 90, Pt. B, §8, is 
amended to read: 
2. Premium rates. The association, as part of the plan of operation under section 
3953, subsection 3, shall establish a methodology for determining premium rates to be 
charged member 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, together with any additional rating factors the association 
determines to be appropriate. The methodology must provide for the development of 
base reinsurance premium rates, subject to approval of the superintendent, set at levels 
that reaseRably appreximate gress premiums CHarged fer iRdividual HealtH plaRs aRd tHat 
are aajusted te reflect reteRtieR levels required uRder tHis Title, together with other funds 
available to the association, will be sufficient to meet the anticipated costs of the 
association. 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 an insurer. 
Sec. 10. 24-A MRSA §3959, as enacted by PL 2011, c. 90, Pt. B, §8, is amended 
to read: 
§3959. Designation for reinsurance 
1. Designation. The association shall provide reinsurance to a member insurer for 
pers9Rs a person designated for reinsurance by a member insurer usiRg tHe HealtH 
statemeRt develeped by tHe beard pursuaRt te sectieR 3955, subsectieR 1, paragrapH F.~ 
the designation was made: 
A. By using the health statement developed by the board pursuant to section 3955, 
subsection 1, paragraph E or by using the person's claims history or risk scores or any 
other reasonable means; 
B. As a mandatory designation pursuant to subsection 2 on the basis of the existence 
or history of any medical or health condition on the list developed by the board 
pursuant to subsection 2; or 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT=t> .. to H.P. 1254, L.D. 1702 
C. On the basis of an omission of material information from the health statement 
developed by the board pursuant to section 3955, subsection 1, paragraph E or 
misrepresentation of the person's health status on the health statement. 
2. Mandatory designation. The board shall develop a list of medical or health 
conditions for which a person is atltomatieally must be designated for reinsurance ~ 
member insurer. 
A persoR wi:lo eemoRstrates If a person's health statement, claims 
history or risk scores demonstrate the existence or history of any medical or health 
conditions on the list developed by the board may Rot be reqtliree to eOillfllete ti:le i:lealti:l 
statemeRt speeifiee iR sabseetioR 1 at the time the plan is issued or when the person is 
added to the plan, the member insurer shall designate the person for reinsurance. The 
board may amend the list from time to time as appropriate. 
3. Enrolling additional persons. A member insurer may designate a person for 
reinsurance pursuant to this section when the person is added to an individual health plan. 
4. Designation effective date and premium. The designation of a person for 
reinsurance is effective as of the effective date of the primary coverage provided by the 
member insurer, except that the earliest effective date for any reinsurance is July 1, 2012. 
A member insurer's premium for reinsurance begins to accrue as of the effective date of 
the designation. 
Sec. 11. 24-A MRS A §3961, sub-§l, as enacted by PL 2011, c. 90, Pt. B, §8, is 
amended to read: 
1. 
Reimbursement. 
A member insurer may seek reimbursement from the 
association and the association shall reimburse the member insurer with respect to a 
person insured through a member insurer's closed book of business to the extent claims 
made by a covered person OR a ealeRear year basis after Jaly 1, 2012 exeeee ti:le amoaRts 
oti:lerwise are eligible for reimbursement pursuant to section 3958, subsection 1, 
paragraph A, if: 
A. The member iRsurer sole aH iReiviclual i:lealti:l plaR to ti:le covered person bep.veeR 
is insured under a policy sold on or after December 1, 1993 and in force as of July 1, 
2012, ti:le iRdiyiclual i:lealili plaH iliat was sole i:las beeR eoHtiHl:loasly reRe'llee by ti:le 
eoyeree perSOR and the member insurer has closed its book of business for individual 
health plans sold between December 1, 1993 and July 1,2012; aHd 
B. The member insurer is able to determine through the use of individual health 
statements, claims history, risk scores or any reasonable means that, betweeR 
Deeember 1, 1993 aRe Jaly 1, 2012, "'Illite ilie persoR reeeivee eoverage aReer aR 
iReiviclual healili plaR issaed by ilie member iRsarer, the covered person woald have 
beeR desigaated currently qualifies for designation by the member insurer pursuant to 
section 3959, subsection 17; and 
C. The member insurer seeks to designate the covered person for reimbursement 
from the association by October 1, 2012. 
This subsection applies only to the individual health plans described and is not intended 
to limit the ability of a member insurer to designate a covered person for reinsurance 
pursuant to section 3959. 
Sec. 12. 24-A MRSA §3961, sub-§l-A is enacted to read: 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT]" to H.P. 1254, L.D. 1702 
1-A. Premium. A member insurer seeking reimbursement under subsection 1 is 
liable to the association for reinsurance premium rates determined in accordance with 
section 3958, subsection 2.' 
SUMMARY 
This amendment replaces the bill and is the minority report of the committee. This 
amendment incorporates all of the provisions in Committee Amendment "A" and also 
adds provisions making meetings of the Board of Directors of the Maine Guaranteed 
Access Reinsurance Association public under the State's freedom of access laws. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Revised: 03/26/12 
~ac 
LD 1702 
LR 2596(03) 
An Act To Correct Inconsistencies and Ambiguities in the Maine Guaranteed Access Reinsurance 
Fiscal Detail and Notes 
Association Act 
,\ 
Fiscal Note for Bill as Amended by Committee Amendment~" l H 
... 848) 
Committee: Insurance and Financial Services 
Fiscal Note Required: Yes 
Fiscal Note 
Minor cost increase - Other Special Revenue Funds 
Any additional costs to the Department of Professional and Financial Regulation are expected to be minor and can be 
absorbed within existing budgeted resources. 
LR2596(03) - Fiscal Note - Page 1 of 1