AUGUSTA – The first proposal to re-establish Maine’s process of reviewing certain health-insurance rate changes is scheduled to go to a legislative committee Tuesday.

L.D. 83, sponsored by Sen. John Patrick, D-Rumford, and co-sponsored by Democratic Senate leaders, would roll back part of a law passed by the Republican-led Legislature along party lines in 2011.

It deals with “rate review,” the state’s ability to accept or reject rate increases for individual and small-group health insurance policies.

More bills seeking to change the law are expected, said Rep. Sharon Treat, a Democrat from Hallowell who co-chairs the Legislature’s Insurance and Financial Services Committee, which will review L.D. 83.

Before the current law took effect, Maine regulators could reject any increase or decrease. Now, insurers can raise rates without approval as long as it’s less than a 10 percent increase and the company is paying 80 percent of the money it receives from premiums toward care and quality improvement.

The summary in Patrick’s bill says it would restore the previous statutory process for review.

“We are very excited and pleased that there are going to be changes to the current rate review provisions,” said Mitchell Stein, policy director for Maine Consumers for Affordable Health Care, which opposed the law passed in 2011. “We consider the changes in (the law) to be a step backwards.”

Assistant Senate Minority Leader Roger Katz, R-Augusta, said he wasn’t surprised that Democrats decided to address rate review.

Patrick’s bill is co-sponsored by Senate President Justin Alfond, D-Portland, Senate Majority Leader Seth Goodall, D-Richmond, and Assistant Senate Majority Leader Troy Jackson, D-Allagash.

A report prepared for the Maine Bureau of Insurance in 2011 said the law now “allows insurers to charge higher rates for older individuals and small groups and lower rates for younger individuals and small groups,” while allowing rate increases in higher-cost areas, like northern Maine and Down East.

Katz has said that the law has had uneven effects but on balance rates have gone down. Taken together, projections in the 2011 report and a study from Stein’s group suggest that’s possible.

The 2011 report said 80 percent of individuals in Maine would see lower rates in the Republican-led law’s first year, while the remaining 20 percent, whose costs would go up, would mostly be elderly residents in rural areas. But it said an increase in individuals in the health insurance market because of the law could push those premiums down by 3 percent to 5 percent overall.

The Maine Consumers for Affordable Health Care report, released last year, said 90 percent of small businesses and 54 percent of individuals insured by Anthem saw insurance rates go up after the law passed. It also showed sharp differences by region – small businesses in comparatively urban southern Maine had more rate decreases than any other region.

But Katz said it’s unclear whether some of those changes were because of the law or other effects. He said he wouldn’t commit to agreeing or disagreeing with Democrats on rate review before hearing what sponsors have to say.

“The question is: Have we begun to bend the curve on annual rate increases? And I believe the answer is yes,” Katz said. “We’ve got to make sure that if there have been any isolated pockets of increases, we need to tweak the law to make sure that doesn’t happen.”

State House Bureau Writer Michael Shepherd can be contacted at 370-7652 or at:

mshepherd@mainetoday.com