An Act To Restore Consumer Rate Review for Health Insurance Plans in the Individual and Small Group Markets
Maine Legislature, Session 126, LD 0225
Committee: Insurance and Financial Services
Sponsors: LIBBY, CRAVEN, BECK, BOLAND, CAMPBELL, CHIPMAN, GILBERT, HOBBINS, MORRISON, SHAW
Amends: 24-A MRSA §2736-A, 24-A MRSA §2736-C, 24-A MRSA §2808-B

Legislative Document 
No. 225 
H.P. 186 
House of Representatives, February 5, 2013 
An Act To Restore Consumer Rate Review for Health Insurance 
Plans in the Individual and Small Group Markets 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
MILLICENT M. MacFARLAND 
Clerk 
Presented by Representative LIBBY of Lewiston. 
Cosponsored by Senator CRAVEN of Androscoggin and 
Representatives: BECK of Waterville, BOLAND of Sanford, CAMPBELL of Newfield, 
CHIPMAN of Portland, GILBERT of Jay, HOBBINS of Saco, MORRISON of South Portland, 
SHAW of Standish. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  24-A MRSA §2736-A, first ¶, as amended by PL 2011, c. 364, §2, 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 or unfairly discriminatory or that the 
filing violates any of the provisions of chapter 23, the superintendent shall cause a 
hearing to be held.  If a filing proposes an increase in rates in an individual health plan as 
defined in section 2736-C, the superintendent shall cause a hearing to be held at the 
request of the Attorney General.  As part of the hearing, the superintendent shall hold 
meetings in at least 3 locations to allow public comment on the rate filing.  In any hearing 
conducted under this section, the insurer has the burden of proving rates are not 
excessive, inadequate or unfairly discriminatory. 
Sec. 2.  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.  Rates 
filed in accordance with this subsection are filed for informational purposes 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 number 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-A. 
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. 3.  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 subsection 2-B, 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. 
Sec. 4.  24-A MRSA §2808-B, sub-§2-A, ¶C, as amended by PL 2007, c. 629, 
Pt. M, §6, is repealed. 
Sec. 5.  24-A MRSA §2808-B, sub-§2-B, as amended by PL 2011, c. 364, §15, is 
further amended to read: 
2-B.  Rate review and hearings.  Except as provided in subsection 2-C, rate Rate 
filings are subject 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. 
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.  As part of the hearing, the superintendent shall hold 
meetings in at least 3 locations to allow public comment on the rate filing.  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 information upon which it supports the filing. 
D.  A carrier that adjusts its rate shall account for the savings offset payment or any 
recovery of that savings offset payment in its experience consistent with this section 
and former section 6913. 
SUMMARY 
This bill restores the statutory process for advance review and prior approval of 
individual health insurance rates and rescinds the changes to the rate review process for 
individual health insurance made by Public Law 2011, chapter 90.  The bill also extends 
the requirement for advance review and prior approval to small group health insurance 
rates.  The bill requires the Superintendent of Insurance to hold a hearing if a filing 
proposes an increase in rates in individual or small group health insurance plans and 
requires the superintendent to hold meetings in at least 3 locations to allow public 
comment as part of any hearing.