The Department of Health and Human Services announced in aletter it has granted a waiver to the MaineBureau of Insurance, which delays the implementation of the federalmedicalloss ratio requirement by three years.

With this waiver, Maine's 65 percent MLR standard for theindividual market will remain in effect through 2013.

According to the HHS letter, "After a careful examination of theapplication and consideration of the criteria set forth in thestatute and implementing regulation, we agree with the reasoningthat led to the MBI's conclusion that application of the 80 percentMLR standard in Maine has a reasonable likelihood of destabilizingthe Maine individual health insurance market."

"We have determined that an adjustment of the MLR to 65 percentis warranted under the particular circumstances presented in theMBI application. While we conclude that such an adjustment isappropriate for three years, the adjustment to 65 percent for thethird year is granted on the condition that the MBI provide CCIIOwith updated data in 2012 that indicate a continued need for suchan adjustment."

The HHS letter contains a review of the Maine waiverapplication, the regulatory criteria used to examine theapplication and an overview of Maine's individual health insurancemarket as well as a summary of public comments.

The HHS and the Department of Treasury also proposed a rule thatoutlines framework for submitting and reviewing applicationsregarding state innovation waivers authorized under the AffordableCare Act.

These waivers would exempt states from certain ACA provisions ifalternative health reform approaches are implemented, beginning in2017. The alternative approaches must be at least as comprehensiveas the health reform law and include a 10-year budget neutral planfor the federal government. Legislation, which was endorsed by thepresident, has been introduced in Congress and would allow thesestate innovation waivers to be granted as early as 2014.