An Act To Improve Transparency and Oversight of the Maine Guaranteed Access Reinsurance Association and To Make Changes Necessary To Comply with Federal Law
Maine Legislature, Session 126, LD 0546
Committee: Insurance and Financial Services
Sponsors: TREAT, BECK, GOODE, MORRISON, GRATWICK, WOODBURY
Amends: 1 MRSA §402, 24-A MRSA §3953

Legislative Document 
No. 546 
H.P. 365 
House of Representatives, February 19, 2013 
An Act To Improve Transparency and Oversight of the Maine 
Guaranteed Access Reinsurance Association and To Make Changes 
Necessary To Comply with Federal Law 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
MILLICENT M. MacFARLAND 
Clerk 
Presented by Representative TREAT of Hallowell. 
Cosponsored by Representatives: BECK of Waterville, GOODE of Bangor, MORRISON of 
South Portland, Senators: GRATWICK of Penobscot, WOODBURY of Cumberland. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  1 MRSA §402, sub-§2, ¶F, 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 private 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 
Sec. 3.  1 MRSA §402, sub-§2, ¶H 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 §3953, sub-§1, as enacted by PL 2011, c. 90, Pt. B, §8, is 
amended to read: 
1.  Guaranteed access reinsurance mechanism established.  The Maine 
Guaranteed Access Reinsurance Association is established as a nonprofit legal entity.  As 
a condition of doing business in the State, an insurer that has issued or administered 
medical insurance within the previous 12 months or is actively marketing a medical 
insurance policy or medical insurance administrative services in this State must 
participate in the association.  The Dirigo Health Program established in chapter 87 and 
any other state-sponsored health benefit program shall also participate in the association.  
Beginning January 1, 2014 and until December 31, 2016, operations of the association are 
suspended and the association may not collect assessments as provided in section 3957, 
provide reinsurance for member insurers under section 3958 or provide reimbursement 
for member insurers under section 3961 except as provided by section 3963.  Prior to 
resuming operations on or after January 1, 2016, the association shall submit a revised 
plan of operation to the superintendent for approval. 
Sec. 5.  24-A MRSA §3953, sub-§2, ¶A, as enacted by PL 2011, c. 90, Pt. B, §8, 
is amended to read: 
A.  The board consists of 11 members appointed as described in this paragraph: 
(1)  Six Eight members appointed by the superintendent: 2 members chosen from 
the general public and who are not associated with the medical profession, a 
hospital or an insurer; 2 members who represent medical providers; 2 members 
who represent individual health insurance consumers; one member who 
represents a statewide organization that represents small businesses; and one 
member who represents producers.  A board member appointed by the 
superintendent may not be removed without cause; and 
(2)  Five Three members appointed by the member insurers, at least one of whom 
is a domestic insurer and at least one of whom is a 3rd-party administrator. 
Sec. 6.  24-A MRSA §3953, sub-§2, ¶E 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, including, but not 
limited to, the use of executive sessions pursuant to Title 1, section 405. 
Sec. 7.  24-A MRSA §§3962 and 3963 are enacted to read: 
§3962.  Reimbursement prohibited; minimum medical loss ratio 
Notwithstanding any other provision of this chapter, the association may not 
reimburse a member insurer for any claims otherwise eligible for reimbursement under 
this chapter if that member insurer has not complied with the minimum medical loss ratio 
for individual health insurance determined under section 4319, subsection 3, and any 
waiver of the minimum medical loss ratio under section 4319, subsection 3 granted under 
federal law does not apply for purposes of this section. 
§3963.  Activities authorized during suspension period 
This section governs the suspension of operations of the association from January 1, 
2014 to December 31, 2016 pursuant to section 3953, subsection 1 and the authority of 
the association to conduct certain activities. 
1.  Payment of claims.  The association shall pay claims eligible under sections 3958 
and 3961 that were incurred prior to January 1, 2014. 
2.  Additional assessment for net losses.  The association may impose any 
additional assessment necessary to fund net losses of the association pursuant to section 
3957, subsection 5. 
3.  Surplus funds.  Any funds held by the association as of its suspension of 
operations must be applied and distributed in the following order of priority: 
A.  To the payment of the expenses, debts and liabilities of the association, including 
reimbursement of all claims; and 
B.  To the setting up of any reserves that the association may determine necessary or 
desirable for any contingent or unforeseen liabilities or obligations, including 
establishing a reasonable reserve to fund the reactivation of the association. 
After satisfaction of all liabilities and obligations for which reserves have been 
established, any remaining funds must be transferred to a trust, nonprofit corporation or 
other fund established pursuant to a termination plan adopted by the board and approved 
by the superintendent, to be used and applied for the general purposes of reducing health 
insurance costs or health care costs in the individual market. 
4.  Exception.  This section does not apply if federal law or regulation exempts the 
State from participation in the transitional reinsurance program pursuant to the federal 
Affordable Care Act. 
Sec. 8.  Evaluation of Maine Guaranteed Access Reinsurance Association.  
During the First Regular Session of the 127th Legislature, the joint standing committee of 
the Legislature having jurisdiction over insurance and financial services matters shall 
conduct a review and evaluation of the transitional reinsurance program operating in the 
State between January 1, 2014 and December 31, 2016 pursuant to the federal Patient 
Protection and Affordable Care Act and federal regulations adopted pursuant to that Act 
and the differences between the transitional reinsurance program and the Maine 
Guaranteed Access Reinsurance Association as established by the Maine Revised 
Statutes, Title 24-A, chapter 54-A.  Before January 1, 2016, the joint standing committee 
of the Legislature having jurisdiction over insurance and financial services matters shall 
make a recommendation to the Superintendent of Insurance whether the Maine 
Guaranteed Access Reinsurance Association should resume operations pursuant to a 
revised plan of operation and whether any changes should be made to the statutes 
governing the association.  The joint standing committee of the Legislature having 
jurisdiction over insurance and financial services matters may report out a bill based on 
the evaluation to the Second Regular Session of the 127th Legislature. 
Sec. 9.  Maine Guaranteed Access Reinsurance Association staggered 
terms.  Notwithstanding the Maine Revised Statutes, Title 24-A, section 3953, 
subsection 2, of the 2 members representing individual health insurance consumers 
initially appointed by the Superintendent of Insurance to the Maine Guaranteed Access 
Reinsurance Association, one member serves for a term of 2 years and one member 
serves for a term of 3 years.  The Superintendent of Insurance shall designate the period 
of service of each appointee at the time of appointment. 
SUMMARY 
This bill makes the following changes to the laws governing the Maine Guaranteed 
Access Reinsurance Association:  
1.  It makes meetings of the Board of Directors of the Maine Guaranteed Access 
Reinsurance Association public under the State's freedom of access laws unless the board 
holds executive sessions as permitted under the State's freedom of access laws; 
2.  It adds 2 consumer members to the Board of Directors and reduces the number of 
board members who are representatives of insurers from 5 to 3; 
3.  It suspends the authority of the association to collect assessments and premiums or 
provide reinsurance and reimbursement for 3 years, from January 1, 2014 until December 
31, 2016 and also requires that the association submit a revised plan of operation to the 
Superintendent of Insurance before resuming operations; 
4.  It provides that the association may not provide reinsurance or reimbursement to a 
member insurer unless the insurer meets the 80% minimum medical loss ratio for 
individual health insurance established under federal and state law; and 
5.  It directs the joint standing committee of the Legislature having jurisdiction over 
insurance and financial services matters to evaluate the transitional reinsurance program 
operating in the State from January 1, 2014 until December 31, 2016 under federal law.  
Before January 1, 2016, the committee is required to make a recommendation to the 
Legislature whether the Maine Guaranteed Access Reinsurance Association should 
resume operations and whether statutory changes should be made.  The Joint Standing 
Committee on Insurance and Financial Services may report out a bill based on its 
recommendations to the Second Regular Session of the 127th Legislature.