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PUBLIC LAWS OF MAINE
First Regular Session of the 121st

PART A

     Sec. A-1. 2 MRSA §6, sub-§1, as amended by PL 1997, c. 643, Pt. Q, §1 and by PL 2001, c. 354, §3, is further amended to read:

     1. Range 91. The salaries of the following state officials and employees are within salary range 91:

     Sec. A-2. 5 MRSA §934-B is enacted to read:

§934-B. Dirigo Health

     The position of executive director is a major policy-influencing position within Dirigo Health established pursuant to Title 24-A, chapter 87. Notwithstanding any other provision of law, this position and any successor position are subject to this chapter.

     Sec. A-3. 5 MRSA §12004-G, sub-§14-D is enacted to read:

14-D. Health Care

Board of Directors of Dirigo Health

$100 per diem and expenses

24-A MRSA §6904

     Sec. A-4. 5 MRSA §12004-I, sub-§30-A is enacted to read:

30-A. Health Care

Maine Quality Forum Advisory Council

Expenses Only

24-A MRSA §6952

     Sec. A-5. 22 MRSA §3174-G, sub-§1, as amended by PL 2001, c. 450, Pt. A, §§1 and 2, is further amended to read:

     1. Delivery of services. The department shall provide for the delivery of federally approved Medicaid services to the following persons:

For the purposes of this subsection, the "nonfarm income official poverty line" is that applicable to a family of the size involved, as defined by the federal Department of Health and Human Services and updated annually in the Federal Register under authority of 42 United States Code, Section 9902(2). For purposes of this subsection, "program budget" means the amounts available from both federal and state sources to provide federally approved Medicaid services.

     Sec. A-6. 22 MRSA §3174-DD is enacted to read:

§3174-DD. Dirigo health coverage

     The department may contract with one or more health insurance carriers to purchase Dirigo Health Insurance for MaineCare members who seek to enroll through their employers pursuant to Title 24-A, section 6910, subsection 4, paragraph B. A MaineCare member who enrolls in a Dirigo Health Insurance plan as a member of an employer group receives full MaineCare benefits through Dirigo Health Insurance. The benefits are delivered through the employer-based health plan, subject to nominal cost sharing as permitted by 42 United States Code, Section 1396o(2003) and additional coverage provided under contract by the department.

     Sec. A-7. 22 MRSA §3174-V, sub-§2, as amended by PL 2003, c. 20, Part K, §11, is further amended to read:

     2. Contracted services. When a federally qualified health center otherwise meeting the requirements of subsection 1 contracts with a managed care plan or Dirigo Health Insurance for the provision of Medicaid MaineCare services, the department shall reimburse that center the difference between the payment received by the center from the managed care plan or Dirigo Health Insurance and 100% of the reasonable cost, reduced by the total copayments for which members are responsible, incurred in providing services within the scope of service approved by the federal Health Resources and Services Administration or the commissioner. Any such managed care contract must provide payments for the services of a center that are not less than the level and amount of payment that the managed care plan or Dirigo Health Insurance would make for services provided by an entity not defined as a federally qualified health center.

     Sec. A-8. 24-A MRSA c. 87 is enacted to read:

CHAPTER 87
DIRIGO HEALTH
SUBCHAPTER 1
GENERAL PROVISIONS

§6901. Short title

     This chapter may be known and cited as "the Dirigo Health Act."

§6902.   Dirigo Health established; declaration of necessity

     Dirigo Health is established as an independent executive agency to arrange for the provision of comprehensive, affordable health care coverage to eligible small employers, including the self-employed, their employees and dependents, and individuals on a voluntary basis. Dirigo Health is also responsible for monitoring and improving the quality of health care in this State. The exercise by Dirigo Health of the powers conferred by this chapter must be deemed and held to be the performance of essential governmental functions.

§6903. Definitions

     As used in this chapter, unless the context otherwise indicates, the following terms have the following meanings.

     1. Board. "Board" means the Board of Directors of Dirigo Health, as established in section 6904.

     2. Child. "Child" means a natural child, stepchild, adopted child or child placed for adoption with a plan enrollee.

     3. Dependent. "Dependent" means a spouse, an unmarried child under 19 years of age, a child who is a student under 23 years of age and is financially dependent upon a plan enrollee or a person of any age who is the child of a plan enrollee and is disabled and dependent upon that plan enrollee. "Dependent" may include a domestic partner consistent with sections 2741-A, 2832-A and 4249 and Title 24, section 2319-A.

     4. Dirigo Health Insurance. "Dirigo Health Insurance" means the health insurance product established by Dirigo Health that is offered by a private health insurance carrier or carriers.

     5. Eligible business. "Eligible business" means a business that employs at least 2 but not more than 50 eligible employees, the majority of whom are employed in the State, including a municipality that has 50 or fewer employees.

After one year of operation of Dirigo Health, the board may, by rule, define "eligible business" to include larger public or private employers.

     6. Eligible employee. "Eligible employee" means an employee of an eligible business who works at least 20 hours per week for that eligible business. "Eligible employee" does not include an employee who works on a temporary or substitute basis or who does not work more than 26 weeks annually.

     7. Eligible individual. "Eligible individual" means:

     8. Employer. "Employer" means the owner or responsible agent of a business authorized to sign contracts on behalf of the business.

     9. Executive director. "Executive director" means the Executive Director of Dirigo Health.

     10. Health insurance carrier. "Health insurance carrier" means:

     11. Health plan in Medicaid. "Health plan in Medicaid" means a health insurance carrier that meets the requirements of 42 Code of Federal Regulations, Part 438 (2002) and has a contract with the Department of Human Services to provide MaineCare-covered services to individuals enrolled in MaineCare.

     12. Participating employer. "Participating employer" means an eligible business that contracts with Dirigo Health pursuant to section 6910, subsection 4, paragraph B and that has employees enrolled in Dirigo Health Insurance.

     13. Plan enrollee. "Plan enrollee" means an eligible individual or eligible employee who enrolls in Dirigo Health Insurance through Dirigo Health. "Plan enrollee" includes an eligible employee who is eligible to enroll in MaineCare.

     14. Provider. "Provider" means any person, organization, corporation or association that provides health care services and products and is authorized to provide those services and products under the laws of this State.

     15. Reinsurance or reinsurer. "Reinsurance" and "reinsurer" have the same meanings as in section 741.

     16. Resident. "Resident" has the same meaning as in section 2736-C, subsection 1, paragraph C-2.

     17. Subsidy. "Subsidy" means a subsidy as described in section 6912.

     18. Third-party administrator. "Third-party administrator" means any person who, on behalf of any person who establishes a health insurance plan covering residents, receives or collects charges, contributions or premiums for or settles claims on residents in connection with any type of health benefit provided in or as an alternative to insurance as defined by section 704, other than:

     19. Unemployed individual. "Unemployed individual" means an individual who does not work more than 20 hours a week for any single employer.

§6904. Board of Directors of Dirigo Health

     Dirigo Health operates under the supervision of a Board of Directors established in accordance with this section.

     1. Appointments. The board consists of 5 voting members and 3 ex officio, nonvoting members as follows.

     2. Qualifications of voting members. Voting members of the board:

     3. Terms of office. Voting members serve 3-year terms. Voting members may serve up to 2 consecutive terms. Of the initial appointees, one member serves an initial term of one year, 2 members serve initial terms of 2 years and 2 members serve initial terms of 3 years. The Governor shall fill any vacancy for an unexpired term in accordance with subsections 1 and 2. Members reaching the end of their terms may serve until replacements are named.

     4. Chair. The Governor shall appoint one of the voting members as the chair of the board.

     5. Quorum. Three voting members of the board constitute a quorum.

     6. Affirmative vote. An affirmative vote of 3 members is required for any action taken by the board.

     7. Compensation. A member of the board must be compensated according to the provisions of Title 5, section 12004-G, subsection 14-D; a member must receive compensation whenever that member fulfills any board duties in accordance with board bylaws.

     8. Meetings. The board shall meet at least 4 times a year at regular intervals and may also meet at other times at the call of the chair or the executive director. All meetings of the board are public proceedings within the meaning of Title 1, chapter 13, subchapter 1.

§6905. Limitation on liability

     A member of the board or an employee of Dirigo Health is not subject to any personal liability for having acted within the course and scope of membership or employment to carry out any power or duty under this chapter. Dirigo Health shall indemnify any member of the board and any employee of Dirigo Health against expenses actually and necessarily incurred by that member or employee in connection with the defense of any action or proceeding in which that member or employee is made a party by reason of past or present authority with Dirigo Health.

§6906.   Prohibited interests of board members and employees

     Board members and employees of Dirigo Health and their spouses and dependent children may not receive any direct personal benefit from the activities of Dirigo Health in assisting any private entity, except that they may participate in Dirigo Health Insurance on the same terms as others may under this chapter. This section does not prohibit corporations or other entities with which board members are associated by reason of ownership or employment from participating in activities of Dirigo Health or receiving services offered by Dirigo Health as long as the ownership or employment is made known to the board and, if applicable, the board members abstain from voting on matters relating to that participation.

§6907. Confidential records

     Except as provided in subsections 1 and 2, information obtained by Dirigo Health under this chapter is a public record within the meaning of Title 1, chapter 13, subchapter 1.

     1. Financial information. Any personally identifiable financial information, supporting data or tax return of any person obtained by Dirigo Health under this chapter is confidential and not open to public inspection.

     2. Health information. Health information obtained by Dirigo Health under this chapter that is covered by the federal Health Insurance Portability and Accountability Act of 1996, Public Law 104-191, 110 Stat. 1936 or information covered by chapter 24 or Title 22, section 1711-C is confidential and not open to public inspection.

§6908. Powers and duties of Dirigo Health

     1. Powers. Subject to any limitations contained in this chapter or in any other law, Dirigo Health may:

     2. Duties. Dirigo Health shall:

     3. Budget. The revenues and expenditures of Dirigo Health are subject to legislative approval in the biennial budget process. At the direction of the board, the executive director shall prepare the budget for the administration and operation of Dirigo Health in accordance with the provisions of law that apply to departments of State Government.

     4. Audit. Dirigo Health must be audited annually by the State Auditor. The board may, in its discretion, arrange for an independent audit to be conducted. A copy of the audit must be provided to the State Controller, to the superintendent, to the joint standing committee of the Legislature having jurisdiction over appropriations and financial affairs, to the joint standing committee of the Legislature having jurisdiction over insurance and financial services matters and to the joint standing committee of the Legislature having jurisdiction over health and human services matters.

     5. Rulemaking. Dirigo Health may adopt rules as necessary for the proper administration and enforcement of this chapter, pursuant to the Maine Administrative Procedure Act. Unless otherwise specified, rules adopted pursuant to this chapter are routine technical rules as defined in Title 5, chapter 375, subchapter 2-A.

     6. Annual report. Beginning September 1, 2004, and annually thereafter, the board shall report on the impact of Dirigo Health on the small group and individual health insurance markets in this State and any reduction in the number of uninsured individuals in the State. The board shall also report on membership in Dirigo Health, the administrative expenses of Dirigo Health, the extent of coverage, the effect on premiums, the number of covered lives, the number of Dirigo Health Insurance policies issued or renewed and Dirigo Health Insurance premiums earned and claims incurred by health insurance carriers offering Dirigo Health Insurance. The board shall submit the report to the Governor, the joint standing committee of the Legislature having jurisdiction over appropriations and financial affairs, the joint standing committee of the Legislature having jurisdiction over health insurance and financial services matters and the joint standing committee of the Legislature having jurisdiction over health and human services matters.

     7. Technical assistance from other state agencies. Other state agencies, including, but not limited to, the bureau, the Department of Human Services, Maine Revenue Services and the Maine Health Data Organization, shall provide technical assistance and expertise to Dirigo Health upon request.

     8. Legal counsel. The Attorney General, when requested, shall furnish any legal assistance, counsel or advice Dirigo Health requires in the discharge of its duties.

     9. Coordination with federal, state and local health care systems. Dirigo Health shall institute a system to coordinate the activities of Dirigo Health with the health care programs of the Federal Government and state and municipal governments.

     10. Initial staffing. Upon request from the board, the Governor shall provide staffing assistance to Dirigo Health in the initial phases of its operation.

     11. Advisory committees. Dirigo Health may appoint advisory committees to advise and assist Dirigo Health. Members of an advisory committee serve without compensation but may be reimbursed by Dirigo Health for necessary expenses while on official business of the advisory committee.

§6909. Executive director

     1. Appointed position. The executive director is appointed by the board and serves at the pleasure of the board. The position of executive director is a major policy-influencing position as designated in Title 5, section 934-B.

     2. Duties of executive director. The executive director shall:

§6910. Dirigo Health Insurance

     1. Dirigo Health Insurance. Dirigo Health shall arrange for the provision of health benefits coverage through Dirigo Health Insurance not later than October 1, 2004. Dirigo Health Insurance must comply with all relevant requirements of this Title. Dirigo Health Insurance may be offered by health insurance carriers that apply to the board and meet qualifications described in this section and any additional qualifications set by the board.

     2. Legislative approval of nonprofit health care plan or expansion of public plan. If health insurance carriers do not apply to offer and deliver Dirigo Health Insurance, the board may have Dirigo Health provide access to health insurance by proposing the establishment of a nonprofit health care plan organized under Title 13-B and authorized pursuant to Title 24, chapter 19 or by proposing the expansion of an existing public plan. If the board proposes the establishment of a nonprofit health care plan or the expansion of an existing public plan, the board shall submit its proposal, including, but not limited to, a funding mechanism to capitalize a nonprofit health care plan and any recommended legislation to the joint standing committee of the Legislature having jurisdiction over health insurance matters. Dirigo Health may not provide access to health insurance by establishing a nonprofit health care plan or through an existing public plan without specific legislative approval.

     3. Carrier participation requirements. To qualify as a carrier of Dirigo Health Insurance, a health insurance carrier must:

     4. Contracting authority. Dirigo Health has contracting authority and powers to administer Dirigo Health Insurance as set out in this subsection.

     5. Enrollment in Dirigo Health Insurance. Dirigo Health shall perform, at a minimum, the following functions to facilitate enrollment in Dirigo Health Insurance.

     6. Quality improvement, disease management and cost containment. Dirigo Health shall promote quality improvement, disease prevention, disease management and cost-containment programs as part of its administration of Dirigo Health Insurance.

§6911. Coordination with MaineCare

     The Department of Human Services is the state agency responsible for the financing and administration of MaineCare. It shall pay for MaineCare benefits for MaineCare-eligible individuals, including those enrolled in health plans in MaineCare that are providing coverage under Dirigo Health Insurance.

§6912. Subsidies

     Dirigo Health may establish sliding-scale subsidies for the purchase of Dirigo Health Insurance paid by individuals or employees whose income is under 300% of the federal poverty level and who are not eligible for MaineCare. Dirigo Health may also establish sliding-scale subsidies for the purchase of employer-sponsored health coverage paid by employees of businesses with more than 50 employees, whose income is under 300% of the federal poverty level and who are not eligible for MaineCare.

     1. Administration. Dirigo Health shall, by rule, establish procedures to administer this section.

     2. Individuals eligible for subsidy. Individuals eligible for a subsidy must:

     3. Limitation of subsidies. Dirigo Health shall limit the availability of subsidies to reflect limitations of available funds.

     4. Limitation on amount subsidized. Dirigo Health may limit the amount subsidized of the payment made by individual plan enrollees under section 6910, subsection 4, paragraph C to 40% of the payment to more closely parallel the subsidy received by employees. In no case may the subsidy granted to eligible individuals in accordance with subsection 2, paragraph A exceed the maximum subsidy level available to other eligible individuals.

     5. Notification of subsidy. Dirigo Health shall notify applicants and their employers in writing of their eligibility and approved level of subsidy.

     6. Report. Within 30 days after any subsidies are established pursuant to this section, the board shall report on the amount of the subsidies, the funding required for the subsidies and the estimated number of Dirigo Health enrollees eligible for the subsidies and submit the report to the joint standing committee of the Legislature having jurisdiction over appropriations and financial affairs, the joint standing committee of the Legislature having jurisdiction over insurance and financial services matters and the joint standing committee of the Legislature having jurisdiction over health and human services matters.

§6913.   Savings offset payments against health insurance carriers, employee benefit excess insurance carriers and third-party administrators

     1. Determination of cost savings. After an opportunity for a hearing conducted pursuant to Title 5, chapter 375, subchapter 4, the board shall determine annually not later than April the aggregate measurable cost savings, including any reduction or avoidance of bad debt and charity care costs to health care providers in this State as a result of the operation of Dirigo Health and any increased enrollment due to an expansion in MaineCare eligibility occurring after June 30, 2004.

     2. Savings offset payments. For the purpose of providing the funds necessary to provide subsidies pursuant to section 6912 and support the Maine Quality Forum established pursuant to subchapter 2, the board shall establish a savings offset amount to be paid by health insurance carriers, employee benefit excess insurance carriers and third-party administrators, not including carriers and third-party administrators with respect to accidental injury, specified disease, hospital indemnity, dental, vision, disability, income, long-term care, Medicare supplement or other limited benefit health insurance, annually at a rate that may not exceed savings resulting from decreasing rates of growth in the State's health care spending and in bad debt and charity care costs. Payment of the savings offset amount must begin 12 months after Dirigo Health begins providing health insurance coverage. The savings offset payment amount, as determined by the board, is the determining factor for inclusion of savings offset payments in premiums through rate setting review by the bureau. Savings offset payments must be made quarterly and are due not less than 30 days after written notice to the health insurance carriers, employee benefit excess insurance carriers and third-party administrators and must accrue interest at 12% per annum on or after the due date.

     3. Maximum savings offset payments on health insurance carriers and employee benefit excess insurance carriers. Each health insurance carrier and employee benefit excess insurance carrier must pay a savings offset in an amount not to exceed 4.0% of annual health insurance premiums and employee benefit excess insurance premiums on policies issued pursuant to the laws of this State that insure residents of this State. The savings offset payment may not exceed savings resulting from decreasing rates of growth in the State's health care spending and bad debt and charity care costs. The savings offset payment applies to premiums paid on or after July 1, 2005. Savings offset payments must reflect aggregate measurable cost savings, including any reduction or avoidance of bad debt and charity care costs to health care providers in this State, as a result of the operation of Dirigo Health and any increased enrollment due to an expansion in MaineCare eligibility occurring after June 30, 2004, as determined by the board consistent with subsection 1. A health insurance carrier and employee benefit excess insurance carrier may not be required to pay a savings offset payment on policies or contracts insuring federal employees.

     4. Determination of savings offset payments. The board shall make reasonable efforts to ensure that premium revenue, or claims plus any administrative expenses and fees with respect to third-party administrators, is counted only once with respect to any savings offset payment. For that purpose, the board shall require each health insurance carrier to include in its premium revenue gross of reinsurance ceded. The board shall allow a health insurance carrier to exclude from its gross premium revenue reinsurance premiums that have been counted by the primary insurer for the purpose of determining its savings offset payment under this subsection. The board shall allow each employee benefit excess insurance carrier to exclude from its gross premium revenue the amount of claims that have been counted by a third-party administrator for the purpose of determining its savings offset payment under this subsection. The board may verify each health insurance carrier, employee benefit excess insurance carrier and third-party administrator's savings offset payment based on annual statements and other reports determined to be necessary by the board.

     5. Failure to pay savings offset payments. The superintendent may suspend or revoke, after notice and hearing, the certificate of authority to transact insurance in this State of any health insurance carrier or employee benefit excess insurance carrier or the license of any third-party administrator to operate in this State that fails to pay a savings offset payment. In addition, the superintendent may assess civil penalties against any health insurance carrier, employee benefit excess insurance carrier or third-party administrator that fails to pay a savings offset payment or may take any other enforcement action authorized under section 12-A to collect any unpaid savings offset payments.

     6. Savings offset payments through reductions in growth in State's health care spending and bad debt and charity care. On an annual basis no later than April of each year, the board shall prospectively determine the savings offset to be applied during each 12-month period. To make its determination, the board shall use the criteria and reports described in subsections 7 and 8. Annual offset payments must be reconciled to determine whether unused payments may be returned to health insurance carriers, employee benefit excess insurance carriers and third-party administrators according to a formula developed by the board. Savings offset payments must be used solely to fund the subsidies authorized by section 6912 and to support the Maine Quality Forum established in subchapter 2 and may not exceed savings from reductions in growth of the State's health care spending and bad debt and charity care.

     7. Demonstration of recovery of savings offset payments through reduction in rate of growth in State's health spending and bad debt and charity care. In accordance with the requirements of this subsection, every health insurance carrier and health care provider shall demonstrate that best efforts have been made to ensure that a carrier has recovered savings offset payments made pursuant to this section through negotiated reimbursement rates that reflect health care providers' reductions or stabilization in the cost of bad debt and charity care as a result of the operation of Dirigo Health and any increased enrollment due to an expansion in MaineCare eligibility occurring after June 30, 2004.

     8. Reports. The following reports are required in accordance with this subsection.

     9. Demonstration of offset. As provided in sections 2736-C, 2808-B and 2839-B, the claims experience used to determine any filed premiums or rating formula must reasonably reflect, in accordance with accepted actuarial standards, known changes and offsets in payments by the carrier to health care providers in this State, including any reduction or avoidance of bad debt and charity care costs to health care providers in this State as a result of the operation of Dirigo Health and any increased enrollment due to an expansion in MaineCare eligibility occurring after June 30, 2004 as determined by the board consistent with subsection 1.

§6914. Intragovernmental transfer

     Starting July 1, 2004, Dirigo Health shall transfer funds, as necessary, to a special dedicated, nonlapsing revenue account administered by the agency of State Government that administers MaineCare for the purpose of providing a state match for federal Medicaid dollars. Dirigo Health shall annually set the amount of contribution. The transfer may not include money collected as a savings payment offset pursuant to section 6913.

§6915. Dirigo Health Fund

     The Dirigo Health Fund is created as a dedicated fund for the deposit of any funds advanced for initial operating expenses, payments made by employers and individuals, any savings offset payments made pursuant to section 6913 and any funds received from any public or private source. The fund may not lapse, but must be carried forward to carry out the purposes of this chapter.

SUBCHAPTER 2
HEALTH CARE QUALITY

§6951. Maine Quality Forum

     The Maine Quality Forum, referred to in this subchapter as "the forum," is established within Dirigo Health. The forum is governed by the board with advice from the Maine Quality Forum Advisory Council pursuant to section 6952. The forum must be funded, at least in part, through the savings offset payments made pursuant to section 6913. Except as provided in section 6907, subsection 2, information obtained by the forum is a public record as provided by Title 1, chapter 13, subchapter 1. The forum shall perform the following duties.

     1. Research dissemination. The forum shall collect and disseminate research regarding health care quality, evidence-based medicine and patient safety to promote best practices.

     2. Quality and performance measures. The forum shall adopt a set of measures to evaluate and compare health care quality and provider performance. The measures must be adopted with guidance from the advisory council pursuant to section 6952. The quality measures adopted by the forum must be the basis for the rules for the collection of quality data adopted by the Maine Health Data Organization pursuant to Title 22, section 8708-A.

     3. Data coordination. The forum shall coordinate the collection of health care quality data in the State. The forum shall work with the Maine Health Data Organization and other entities that collect health care data to minimize duplication and to minimize the burden on providers of data.

     4. Reporting. The forum shall work collaboratively with the Maine Health Data Organization, health care providers, health insurance carriers and others to report in useable formats comparative health care quality information to consumers, purchasers, providers, insurers and policy makers. The forum shall produce annual quality reports in conjunction with the Maine Health Data Organization pursuant to Title 22, section 8712.

     5. Consumer education. The forum shall conduct education campaigns to help health care consumers make informed decisions and engage in healthy lifestyles.

     6. Technology assessment. The forum shall conduct technology assessment reviews to guide the use and distribution of new technologies in this State. The forum shall make recommendations to the certificate of need program under Title 22, chapter 103-A.

     7. Electronic data. The forum shall encourage the adoption of electronic technology and assist health care practitioners to implement electronic systems for medical records and submission of claims. The assistance may include, but is not limited to, practitioner education, identification or establishment of low-interest financing options for hardware and software and system implementation support.

     8. State health plan. The forum shall make recommendations for inclusion in the State Health Plan described under Title 2, chapter 5, including recommendations based on the technology assessment reviews under subsection 6.

     9. Annual report. The forum shall make an annual report to the public. The forum shall provide the report to the joint standing committees of the Legislature having jurisdiction over appropriations and financial affairs, health and human services matters and insurance and financial services matters.

§6952. Maine Quality Forum Advisory Council

     The Maine Quality Forum Advisory Council, referred to in this subchapter as "the advisory council," is a 17-member body established by Title 5, section 12004-I, subsection 30-A, to advise the forum. Except as provided in section 6907, subsection 2, information obtained by the advisory council is a public record as provided by Title 1, chapter 13, subchapter 1.

     1. Appointment; composition. The Governor shall appoint the following members with the approval of the joint standing committee of the Legislature having jurisdiction over health and human services matters:

Prior to making appointments to the advisory council, the Governor shall seek nominations from the public and from a statewide allopathic association, a statewide osteopathic association, a statewide hospital association, a statewide nurses association, a statewide health purchasing collaborative, a statewide health management coalition, organized labor, a statewide organization representing consumers advocating for affordable health care, a statewide association representing consumers of mental health services, a national association of retired persons, a statewide citizen action organization, a statewide organization advocating equal justice, a statewide organization representing local chambers of commerce, a statewide organization representing businesses for social responsibility, a statewide small business alliance, a national federation of independent businesses, a statewide association of health plans and other entities as appropriate.

     2. Terms. Members of the advisory council serve 5-year terms except for initial appointments. Initial appointments must include 5 members appointed to 3-year terms, 6 members appointed to 4-year terms and 6 members appointed to 5-year terms. A member may not serve more than 2 consecutive terms.

     3. Compensation. Members of the advisory council are eligible for compensation according to the provisions of Title 5, chapter 379.

     4. Quorum. A quorum is a majority of the members of the advisory council.

     5. Chair and officers. The advisory council shall annually choose one of its members to serve as chair for a one-year term. The advisory council may select other officers and designate their duties.

     6. Meetings. The advisory council shall meet at least 4 times a year at regular intervals and may meet at other times at the call of the chair or the executive director of Dirigo Health. Meetings of the council are public proceedings as provided by Title 1, chapter 13, subchapter 1.

     7. Duties. The advisory council shall:

SUBCHAPTER 3
DIRIGO HEALTH HIGH-RISK POOL

§6971. Dirigo Health High-risk Pool

     Dirigo Health shall establish the Dirigo Health High-risk Pool, referred to in this section as "the high-risk pool" for plan enrollees in accordance with this section.

     1. Eligible enrollees for high-risk pool. A plan enrollee must be included in the high-risk pool if:

     2. Disease management. Dirigo Health shall develop appropriate disease management protocols, develop procedures for implementing those protocols and determine the manner in which disease management must be provided to plan enrollees in the high-risk pool. Dirigo Health may include disease management in its contract with participating carriers for Dirigo Health Insurance pursuant to section 6910, contract separately with another entity for disease management services or provide disease management services directly through Dirigo Health.

     3. Report. Dirigo Health shall submit a report, no later than January 1, 2006, outlining the disease management protocols, procedures and delivery mechanisms used to provide services to plan enrollees. The report must also include the number of plan enrollees in the high-risk pool, the types of diagnoses managed within the high-risk pool, the claims experience within the high-risk pool and the number and type of claims exceeding $100,000 for enrollees in the high-risk pool and for all enrollees in Dirigo Health Insurance. The report must be submitted to the joint standing committee of the Legislature having jurisdiction over health insurance matters. The committee may make recommendations on the operation of the high-risk pool and may report out legislation to the Second Regular Session of the 122nd Legislature relating to the high-risk pool.

     4. Establishment of statewide high-risk pool. After 3 years of operation, but no later than October 1, 2007, Dirigo Health shall evaluate the impact of Dirigo Health on average premium rates in this State and on the rate of uninsured individuals in this State and compare the trends in those rates to the trends in the average premium rates and average rates of uninsured individuals for the 31 states that have established a statewide high-risk pool as of July 1, 2003. The board shall submit the evaluation of the impact of Dirigo Health in this State in comparison to states with high-risk pools to the joint standing committee of the Legislature having jurisdiction over health insurance matters by January 1, 2008. If the trend in average premium rates in this State and rate of uninsured individuals exceed the trend for the average among the 31 states with high-risk pools, the board shall submit legislation on January 1, 2008 to the Second Regular Session of the 123rd Legislature that proposes to establish a statewide high-risk pool in this State consistent with the characteristics of high-risk pools operating in other states.

     Sec. A-9. Monthly report. The Department of Human Services shall provide a monthly report of enrollment and expenditures for the noncategorical adults enrolled in the MaineCare program under the Maine Revised Statutes, Title 22, section 3174-G, subsection 1, paragraph F. The report must include the number of members, expenses and projections for expenses in the state fiscal year for members enrolled under the expansion of income eligibility from 100% of the nonfarm income official poverty line to 125% of the nonfarm income official poverty line.

     Sec. A-10. Determination of savings offset payments for third-party administrators. The Governor's Office of Health Policy and Finance and the Board of Directors of Dirigo Health, established pursuant to the Maine Revised Statutes, Title 24, chapter 87, shall develop a methodology to determine an appropriate savings offset payment to be paid by third-party administrators as required by Title 24-A, section 6913, subsection 2. In developing the methodology, the Governor's office and the board shall consult with and reach consensus among self-insured employers, multiple-employer welfare arrangements and third-party administrators. The methodology must take into account both the similarities and the differences that exist between self-insured plans, multiple-employer welfare arrangements and health insurance. No later than February 1, 2004, the board shall report on the methodology, including recommended legislation to implement the savings offset payments, to the Joint Standing Committee on Insurance and Financial Services. The Joint Standing Committee on Insurance and Financial Services may report out legislation to the Second Regular Session of the 121st Legislature to implement the savings offset payments.

     Sec. A-11. Effective date. That section of this Part that amends the Maine Revised Statutes, Title 22, section 3174-G, subsection 1 takes effect on the date that coverage is first provided to eligible employees and eligible individuals under Dirigo Health Insurance as established in Title 24-A, section 6910.

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