# Kimball v. Superintendent of Insurance & Maine Bureau of Insurance

> Superior Court of Maine · April 11, 2014

URL: https://www.frixlaw.com/law-library/cases/10810575

## Case

- **Court:** Superior Court of Maine
- **Decided:** April 11, 2014
- **Precedential status:** Unpublished
- **Opinion:** Opinion
- **Judges:** Andrew M. Horton
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

E 1\1 T ERE D AUG 2 9 Z014

STATE OF MAINE BUSINESS AND CONSUMER COURT

Cumberland, ss.

ROBERT L. KIMBALL, BRIDGTON HOSPITAL,
RUMFORD HOSPITAL, MAUREEN HARPELL, N.P.,
ALBERT ANIEL, M.D., DAVID SALKO, M.D.,
BRENDA WEEKS, JULIE RIOUX, LISA PEASE,
CENTRAL MAINE HEALTHCARE CORPORATION,
CENTRAL MAINE MEDICAL CENTER,
DIETER KRECKEL, M.D., ALAN VERRILL, M.D.,
WILLIAM LEE, M.D., DANIEL TRAFFORD,
and JOHN DOE and MARY ROE, unknown individuals,

Petitioners

V. Docket No. BCD-AP-1.~-0."i

ST TPFRINTENDENT OF INSURANCE
and BUREAU OF INSURANCE,
DEPARTMENT OF PROFESSIONAL
AND FINANCIAL REGULATION,
STATE OF MAINE

Respondents

and

ANTHEM HEALTH PLANS OF MAINE,

Party in interest

DECISION ON APPEAL

Pursuant to M.R. Civ. P. 80C, Petitioners appeal from the Amended Decision

and Order ofthe Respondent Superintendent of the Maine Bureau oflnsurance,

approving, with conditions, a provider access plan proposed by Party in Interest

Anthem Health Plans of Maine, Inc. ("Anthem") for Anthem's Guided Access HMO

health insurance products.

Anthem is one of the two health insurers that presently offer plans on the

Affordable Care Act ("ACA") individual exchange for Maine. Anthem's ACA products
for ten northern Maine counties are called Guided Access POS plans, and its ACA

products for six southern Maine counties are called Guided Access HMO plans. Only

the access plan for Anthem's Guided Access HMO products is at issue in this appeal. 1

In his Amended Decision and Order [hereinafter "Amended Decision"], the

Superintendent oflnsurance determined that Anthem's proposed Guided Access HMO

network ofhealthcare providers would, upon fulfillment of specified conditions, provide

reasonable access to healthcare services under the Insurance Code (24-A M.R.S. §4SOS)

and Insurance Regulations (Insurance Rule Chapter 850(7)).

The Petitioners include Anthem subscribers who claim they may be adversely

affected by the approval of the proposed Guided Access HMO provider network, as well

as hospitals and individual health care providers that are excluded from the provider

network.

In their brief on appeal, Petitioners contend that the outcome of the proceeding

was materially affected by a bias favoring Anthem's Guided Access plans on the part of

the Superintendent, and base their assertion in part on statements made by or on behalf

of the Superintendent before the hearing began. Also, Petitioners assert that the

Superintendent failed to provide notice to the public and other interested parties

pursuant to the Administrative Procedure Act ("APA"); that the Superintendent made

several errors oflaw before, during, and after the hearing that materially affected the

decision; that the conduct of the proceeding was unfair and violated due process and the

APA; that the Superintendent erred as a matter oflaw in determining that, even with

conditions, Anthem's proposed Guided Access HMO access plan comports with 24-A

1
The Amended Decision addressed Anthem's Guided Access POS access plan as well as the
Guided Access HMO access plan, seeR. 2:2640 (Amended Decision at 59), but the former is not
at issue.

2
M.R.S. §4303(1) and Insurance Rule Chapter 850(7); and that he erred in denying a

motion to stay in the proceedings.

This Decision on Appeal addresses all of those contentions. The underlying

facts are largely undisputed, and the parties have agreed on a voluminous certified

record. What factual disagreements there are among the parties arise primarily focus

on what inferences should be drawn from undisputed facts.

I. Parties

A. The Petitioners:

The Petitioners identify themselves as follows in the Petition:

• Rumford Hospital in Rumford, Oxford County, is a Critical Access Hospital that
serves fourteen contiguous towns as the sole hospital; and the approved Guided
Access plans would exclude Rumford Hospital as well as all 14 primary care
physicians ("PCP") who practice in Rumford and in those fourteen towns.
Rumford Hospital also offers specialty clinics that are available only at Rumford
Hospital in Oxford County.

• Bridgton Hospital is a Critical Access Hospital in Bridgton, northern
Cumberland County, that serves seventeen contiguous towns; and the approved
Guided Access plans would exclude Bridgton Hospital and 19 of the 20 PCP's
who practice in Bridgton and those seventeen towns. Bridgton Hospital also
offers specialty clinics that provide services available in that area only at
Bridgton Hospital.

• Central Maine Medical Center (CMMC), located in Lewiston, Androscoggin
County, is one of only three tertiary care hospitals in the state of Maine, and is
the only tertiary care hospital located in Androscoggin, Oxford and Franklin
counties. The approved Guided Access plans would exclude CMMC and more
than 200 physicians, including 72 PCP's, employed by CMMC.

• All three hospital Petitioners are owned by Petitioner Central Maine Healthcare
Corporation (CMHC), a nonprofit corporation that provides an array of
healthcare services under the name Central Maine Medical Family. See
\VWW .cmrnfor(r
-··"·------·----··'('El

• Maureen Harpell, N.P. is a nurse practitioner practicing in Cumberland County .
Alan Verrill is a primary care physician practicing in Cumberland County.
William Lee, M.D. is a primary care physician practicing in Androscoggin
County. Albert Aniel, M.D. and Dieter Kreckel, M.D., are primary care

3
physicians practicing in Oxford County. David Salko, M.D. is a primary care
physician practicing in Sagadahoc County. All of the individual health-care
provider Petitioners have established provider-patient relationships with
individuals who are covered by other Anthem individual or small group plans,
and all are participating providers under those plans. However, all of them are
excluded from the provider networks in the Guided Access plans approved by
the Superintendent. ·

• Robert Kimball, Brenda Weeks, Julie Rioux, Lisa Pease and Daniel Trafford are
individual residents of Cumberland, Androscoggin and York Counties who are
or were subscribers under Anthem individual or small group health plans. They
assert that they are affected by the approval decision at issue in this appeal
because their PCPs are excluded from the provider networks of the Guided
Access plans, and/ or the hospitals that they have used as a matter of choice and
convenience are excluded. They allege that they may be adversely affected by
the approval of the Guided Access plans because they may have to travel
substantial distances for medical and hospital services as a result.

• Petitioners John Doe and Mary Roe are alleged to be unknown individual
subscribers to Anthem health plans who did not get notice of the proceedings
culminating in the Guided Access approval decision at issue, and who may be
adversely affected by the approval decision because their PCPs are excluded
from the provider networks ofthe Guided Access plans, and/or the hospitals
that they have used as a matter of choice and convenience are excluded. They
allege that they may be adversely affected by the approval of the Guided Access
plans because they may have to travel substantial distances for medical and
hospital services as a result.

Among the Petitioners, Rumford Hospital, Bridgton Hospital, individual

physicians/providers Albert Aniel, David Salko, Maureen Harpell, and individual

subscribers, Brenda Weeks, Julie Rioux, and Lisa Pease, intervened in the

administrative proceeding that culminated in the Guide Access approval decision.

They are referred to below as "the Intervenor Petitioners."

Central Maine Healthcare Corporation (CMHC), Central Maine Medical Center

(CMMC), individual physicians Dieter Kreckel, Alan Verrill and William Lee, and

petitioner Daniel Trafford, did not intervene in the proceeding below, but filed a motion

to stay the proceeding, which was denied.

4
Petitioner Robert Kimball asserts that he did not receive timely notice of the

proceeding, and that because the contents of the Anthem application were withheld

from the public, he could not determine what effect it would have on him in time to

participate meaningfully in the proceeding. Petitioners allege that others, named

herein as John Doe and Jane Roe, are situated similarly to Mr. Kimball.

B. Respondents Superintendent and Bureau of Insurance

Pursuant to statute, the Maine Superintendent oflnsurance is the head of the

Maine Bureau oflnsurance. 24-A M.R.S. § 201. The Superintendent's statutory

authority includes reviewing all proposed individual and small group health insurance

products to be sold in Maine to ensure they comply with applicable provisions of the

Maine Insurance Code relating to, among other things, covered benefits, contract terms,

premium rates, and-most relevant here-access to health care services. See, e.g., 24-A

M.R.S. §§ 2701-2768, 2808-B, & 4303(1).

C. Party in Interest Anthem Health Plans of Maine

Anthem is an insurance carrier that is licensed in Maine to offer a variety of

individual and group health insurance plans, including the two Guided Access plans that

are the subject of this appeal.

II. Background

A. The Federal Affordable Care Act

Effective January 1, 2014, the federal Patient Protection and Affordable Care

Act, P.L. 111-148, (the "ACA"), sets standards in terms of covered benefits and out-of-

pocket costs for most individual and small-group health plans sold in the U.S. Health

insurance coverage purchased before March 23, 2010 is grandfathered from the ACA

requirements. However, the ACA requires those with more recently acquired coverage,

5
as well as most uninsured Americans, either to obtain conforming health coverage or to

pay a substantial penalty, amounting to at least 1% of income in 2014, and rising to at

least 2.5% of income in future years. 26 U.S.C. § 5000A.

In order to help Americans afford mandatory coverage, the ACA offers federal

subsidies to those earning less than four times the federal poverty level (about $94,000

per year for a family offour). See 26 U.S.C. § 36B. However, federal subsidies are

available only for the purchase of coverage under policies certified as "qualified health

plans" or QHPs. Id. § 36B(b)(2). A QHP certification indicates that the policy meets

certain quality standards above and beyond the minimum standards applicable to all

policies sold after March 2010. See42 U.S.C. § 18031(c). To obtain federal subsidies,

consumers must purchase a certified QHP, and, further, must do so through a

"marketplace" run by the federal government (sometimes also called an "exchange"),

accessed primarily via www.healthcare.gov.

Because the ACA generally does not preempt state insurance regulation, Maine

carriers wishing to offer QHP plans on the marketplace had to obtain, in addition to

federal QHP certification, all approvals required under the Maine Insurance Code, Title

24-A of the Maine Revised Statutes, (the "Code"). See 42 U.S.C. § 18041(d). Because

online access to the exchanges via healthcare.gov was scheduled to be available to

consumers beginning October 1, 2013, the federal agency responsible for overseeing the

start-up of the ACA, the Center for Medicare and Medicaid Services (CMS), set

deadlines designed to ensure that proposed QHPs would be ready for sale by October 1.

The Superintendent understood there was a July 31, 2013 deadline for him to

review and decide whether to approve any proposed QHPs for Maine, and to forward to

CMS the final state-reviewed QHP plan data with a recommendation on whether the

6
QHPs proposed for Maine should be certified by CMS. SeeR. 2:2180, 2434. 2 The

Superintendent also treated the July Sl deadline as firm, in that any proposed QHP that

had not been recommended for certification by CMS's Julys 1, 201S deadline was at risk

of not being certified as a QHP by the October 1, 201S date by which the online ACA

exchanges were scheduled to be available to consumers. SeeR. 2:2214, 24S4.

The record does not appear to include any actual communication from CMS

setting the July Sl, 201S deadline for state regulators to review and, if they so decide, to

recommend QHPs for certification, although the Respondents' brief on appeal cites to

an April 5, 201S guidance letter from CMS setting such a deadline. See Rule 80C Brief

for Respondents Superintendent oflnsurance and Bureau oflnsurance at 5. However, it

is clear that the Superintendent understood the deadline to be firm, seeR. 2:2214, 2218,

2434. Although Petitioners question whether the JulyS 1 deadline was as firm as the

Superintendent believed, Petitioners' brief does not deny that the deadline existed.

Hence, this Decision on Appeal does not treat the existence or firmness of the deadline

as contested issues on appeal.

B. Anthem's Proposed "Narrow Network" Access Plans

In late April 201S, Anthem filed a QHP application seeking to offer two sets of

products in Maine on the federal ACA exchange for Maine. For six northern and

eastern Maine counties-Aroostook, Hancock, Washington, Penobscot, Piscataquis and

Somerset-Anthem proposed a set of point-of-service HMO products collectively called

the "Guided Access POS" plan. R. 2:2166. For the remaining ten Maine counties,

2 This and similar citations are pin cites to the Certified Record filed in this case. Citations are
in [binder number]:[record page] format. Thus, "R. 2:2214" refers to the page stamped 2214 in
the lower right corner that is inside the binder labeled Binder 2.

Citations to the transcripts of the June 28 and July 2 hearing sessions are in [binder
number]:[hearing date]:[transcript page]:[line] format. E.g. R. 5:6/28:195-96.

7
Anthem proposed a set of traditional HMO products called the "Guided Access HMO"

plan. Id. Only the Guided Access HMO products are at issue in this appeal.

Anthem could not offer the Guided Access HMO or Guided Access POS

products to the public without the approval of the Superintendent oflnsurance. By

Bureau rule, all carriers seeking to offer managed care plans in Maine, including HMO

plans, must file "access plans," which must disclose the proposed plan's provider

network as well as other information needed by the Superintendent to assess whether

the plan will provide "reasonable access to health care services." See 24-A M.R.S.

§ 4SOS(1); 02-031 C.M.R. ch. 850, § 7(A) ("Rule 850") R. 7:6125).

Anthem submitted its proposed access plans for its Guided Access HMO

products as well as its Guided Access POS products by letter dated MayS 1, 2013. R.

1A: 1-2; 1B:624-25. The proposed access plan for the Guided Access HMO products

consisted offour main parts: (1) an 11-page application form, R. 1A:3-1S), (2) a list of

participating providers, R. 1A:14-514) (S) samples ofprovider contracts, R. 4:5868-

5917), and (4) a series of "managed care accessibility analyses" comparing the

geographic distribution of Anthem's membership against that of various types of

participating providers, R. 1A:515-623).

Anthem's proposed access plan for the Guided Access HMO products featured a

"narrow" provider network that excluded, among others, six southern Maine hospitals,

including the three hospital Petitioners in this appeal, and hundreds of physicians and

other individual health care providers who currently participate in networks for other

Anthem plans and provide medical services to Anthem subscribers. In contrast,

Anthem's access plan for its Guided Access POS products proposed a "broad network,"

encompassing nearly all providers in the six counties in which those products would be

8
offered. SeeR. 2:258.3. Anthem's proposed broad network for the Guided Access POS

products did not raise comparable questions regarding reasonable access.

Among the Petitioner hospitals, Anthem's Guided Access HMO "narrow

network" excludes Rumford Hospital, Bridgton Hospital, and Central Maine Medical

Center, the only tertiary care hospital located in Androscoggin, Oxford and Franklin

counties. The proposed network excluded more than 200 physicians, including 72

PCPs, employed by CMMC in Androscoggin County. In addition to the Petitioner

Hospitals, York Hospital, Mercy Hospital and Parkview Adventist Medical Center were

excluded from the proposed Anthem Guided Access HMO "narrow network."

The exclusion of six hospitals and hundreds of individual providers from

Anthem's "narrow network" for the Guided Access HMO products has obvious

significant implications for both the excluded providers and the consumer who elect

coverage under the Guided Access HMO plan.

As part of its justification for the "narrow network," Anthem was required to

project enrollment in its proposed Guided Access HMO plans-a daunting task given

the new health insurance landscape created by the ACA and the uncertainties associated

with that landscape. Anthem projected that about half of its current individual

members and subscribers would be eligible to maintain coverage under grandfathered

plans, and the rest would not. R. 5:6/28: 195-96. However, because enrollment in the

Guided Access plans likely would include people new to Anthem, Anthem's projection

assumed enrollment in the Guided Access HMO plans equal to its entire individual and

small group membership of 40,.385 persons. R. 1A:5.

The cover letters under which Anthem submitted its access plans for the Guided

Access HMO and Guided Access POS products designated its entire access plan filing

9
as confidential. Each letter indicated in pertinent part, "Anthem is asserting

confidentiality with respect to this letter itself and of its existence and additionally, we

are asserting the confidentiality of the filing in its entirety and request that the filing be

afforded confidential treatment until after its approval." R. 1A: 1, 1B:624. The stated

basis for Anthem's blanket claim of confidential status was that "the filing in its entirety

consists of trade secret information protected from disclosure under 1 M.R.S.A. §

402(S)(B) and Maine Rule ofEvidence 507 (Trade Secrets)."

Although Anthem's assertion of confidentiality was justified as to portions of its

access plan filing and colorable as to others, Anthem's blanket assertion of

confidentiality for the entire filing, extending to the very existence of the cover letter,

was an overreach. Anthem's over-designation of confidential material plainly impeded

public disclosure of a filing that by any measure was of substantial public concern.

C. The Bureau oflnsurance Procedure For Reviewing- Anthem's Application

After reviewing Anthem's Guided Access HMO access plan, the Superintendent

decided, on his own initiative, to convene a formal administrative proceeding, later

captioned In re: Anthem Blue Cross and Blue Shield Requestfor Approval ofAccess Plans,

Docket No. INS-1.3-801, to determine whether Anthem's proposed access plans would

provide subscribers with "reasonable access to medical services" as required by statute

and the Bureau's regulations. R. 2166-68; see 24-A M.R.S. § 4.30.3(1); 02-0S 1 C.M.R.

ch. 850, § 7(A).

The Bureau and Anthem note that the Superintendent was not required to hold

a formal hearing on Anthem's access plan proposals. This was true when he decided to

hold the hearing, because no request for a hearing had been made as of that date.

Section 229 of the Maine Insurance Code permits the Superintendent to hold a hearing

10
on his own initiative, but the same section statute requires the Superintendent to hold a

hearing "[u]pon written application for a hearing by a person aggrieved by any act or

impending act, or by any report or order of the superintendent ... " 24-A M.R.S. §

229(1), (2)(B). Had the Superintendent not convened a hearing sua sponte, there

undoubtedly would have been a request for hearing filed by some person claiming to be

aggrieved, such as any of the Petitioners.

The Superintendent issued a Notice ofPending Proceeding and Hearing, dated

June 5, 2013, (the "Notice") describing the nature of Anthem's proposal and identifying

the regulatory framework that the Superintendent intended to apply in reviewing the

proposal. R. 2:2166-68. The Notice set June 12, 2013 at 3 p.m. as the deadline for

Petitions to Intervene 3 , and it set the hearing for June 28, 2013. Id. Although the

hearing date was little more than three weeks after issuance of the Notice and less than

that from when the Notice was actually published, the interval before hearing was still

more than the 14-day minimum set by statute, see 24-A M.R.S. § 230(2).

On June 6, the Superintendent sent the Notice to counsel for Petitioners in this

case. R. 2:2584-85.) Also on June 6, the Superintendent provided the Notice to the

Maine Medical Association and the Maine Hospital Association, trade groups

representing the interests of Maine's doctors and hospitals respectively. Id. The

Superintendent posted the Notice on the Bureau oflnsurance's public website, and also

sent the Notice to five general circulation daily newspapers for publication. Of the four

~ The June 12 deadline for intervention was not an absolute deadline; the Notice allowed for
petitions to intervene filed after the deadline to be granted upon a showing of"good cause." R.
2:2167. The Superintendent's subsequent June 12 procedural order clarified that post-deadline
petitions would be allowed "upon a compelling showing of good cause." R. 2:2180. However, all
of the petitions to intervene that were filed were timely and all of them were granted. There is
no evidence that the Superintendent's June 12 deadline, tight as it was, actually deprived anyone
who wanted to intervene of that opportunity.

11
daily newspapers in the ten counties encompassed by Anthem's Guided Access HMO

filing, the Portland Press Herald and Lewiston Sun Journal published the Notice on June

12 and 13, and the KENNEBEC JOURNAL and Morning Sentinel published it on June 13

and 14. Id. See 5 M.R.S. § 9052(3)(B) (requirement to publish in a newspaper "in the

area of the state affected"). 4

During the one-week interval between the issuance of the Notice and the

deadline for petitions to intervene, the Superintendent kept Anthem's access plan filings

confidential at Anthem's request, pending his review of the filings to determine whether

they qualified for confidential treatment.

On June 11, 2013, some of the Petitioners, including CMHC and its affiliate

hospital, CMMC, filed a Motion for Stay, seeking to stay the proceeding that the

Superintendent had instituted, including the intervention deadline and the hearing,

"until a reasonable time after all public records relating to the proposed Anthem plans

have been made available to the public, and the Applicants and other potentially

interested and affected persons have had an opportunity to review the public records

and make a determination whether to intervene in this proceeding." R. 2:2205-09.

None of the Petitioners that filed the Motion for Stay sought to intervene in the

proceeding, and none of the Petitioners that sought to intervene joined in the Motion

for Stay. (The Petitioners who sought leave to intervene are hereinafter called "the

Intervenor Petitioners" and those who did not are called "the non-Intervenor

Petitioners"). The only intervenor in the proceeding that requested a stay was York

·fThe fifth general circulation newspaper, the BANGOR DAILY NEWS, did not publish the notice
until June 17 and 18, but that newspaper is not in the area of the state affected by the Guided
Access HMO products at issue here.

12
Hospital, which filed a Motion to Stay on June 12, 2013. R. 2:2216-2217. That motion

was denied June 13, 2013. R. 2:2218-2219.

Also on June 11, the Superintendent issued an Order Clarifying The Scope of

Hearing to resolve an ambiguity created by the fact that Anthem submitted its Guided

Access HMO access plan filings on Bureau of Insurance forms intended to be used for

initial registration ofpreferred provider arrangements (PPAs). R:2:2175-76; see also R.

1A:3 (Anthem's filing). 5 Under the Insurance Code, proposed PPAs are subject to

network adequacy standards different from those applicable to proposed HMO provider

networks. Compare 24-A M.R.S. § 267 3-A (PP A standards) with 24-A M.R.S. § 4303( 1)

(HMO standards).

The Superintendent's Order Clarifying the Scope of Hearing confirmed that the

proceeding and hearing would focus on "whether Anthem's proposed networks meet

adequacy standards applicable to HMOs, including 24-A M.R.S. § 4303(1) and

Insurance Rule 850(7)." R. 2:2176. The Order also indicated that, based on Anthem's

filings, "the provider networks proposed by Anthem need not be approved as PPAs to

be used with the Guided Access HMO or the Guided Access POS products." !d.

The next day, June 12, 2013, some ofthe Petitioners, including CMHC's other

affiliate hospitals Rumford Hospital and Bridgton Hospital, filed a petition to intervene

in the proceeding. R. 2:2200-03. Petitions to Intervene were also filed by York

5
The Order Clarifying the Scope of Hearing responded to a June 10, 201S letter from Petitioners'
attorney, writing on behalf of unspecified clients, "request[ing] clarification" that the proceeding just
initiated "is being held solely to determine whether the proposed Anthem plans identified in its MayS 1,
201 S filing, meet network adequacy requirements (specifically under 24-A M.R.S. § 420S(S), § 4SOS( 1)
and Chapter 850(7) of the Insurance Rules." R. 2:2160. Attorney Poulin's letter also sought confirmation
that "this proceeding and hearing are not being held to determine whether the proposed Anthem plans
identified in its May S I, 20 IS filing meet the requirements of the Preferred Provider Arrangement Act
(24-A M.R.S. § 267S-A and Insurance Rule Chapter S60)." Id.

13
Hospital and Mercy Hospital, and by the Maine Attorney General's Office. R. 2200-05,

2194, 2196-97, 2198-99.

June 12 was a busy day for the Superintendent. On that day, he denied the

Motion for Stay filed by the non-Intervenor Petitioners, R. 2:2210-15; granted all of the

petitions to intervene that had been filed, R. 2:2204; ordered that a portion of Anthem's

filing be made public; entered a protective order allowing for intervenors' counsel to

obtain "eyes only" access to the rest of Anthem's filings, R. 2:2188-95; and issued a

procedural order setting further dates and deadlines for parties to the proceeding to

take discovery and to prefile their proposed testimony and exhibits for the June 28

hearing.

In denying the motion to stay filed by some of the Petitioners, the

Superintendent noted that, as non-parties to the newly instituted proceeding, the

movants lacked standing to seek to delay it. He also pointed out that granting a stay

would likely delay the hearing on Anthem's proposed access plans until July 21, too

close to the CMS deadline ofJuly 51, 2015 for states to submit QHP recommendations,

and also that the movants could achieve their goal oflearning more about Anthem's

plans by petitioning to intervene. R. 2:2210-15.

The Superintendent's June 12 protective order appears to reflect an effort to

balance Anthem's confidentiality interest against the intervenors' right to effective

participation in the proceeding and the public's right of access to non-confidential

material. The Protective Order provided for the initial registration forms, totaling 11 of

the 665 pages of Anthem's Guided Access HMO access plan filing, to become public

June 15, 2015, although the remaining 652 pages of that filing were provisionally

designated as "attorneys eyes only". R. 2:2188-89. The "attorneys' eyes only"

14
designation meant that counsel for all intervenors could review Anthem's entire access

plan filing, but could not share or disclose the contents of Anthem's filing other than the

11 pages with anyone else. Petitioners make a valid point that, because they could not

share or disclose the contents of Anthem's filing with the hospital and health care

professionals with whom Petitioners' counsel were working, Petitioners could not

prepare for the hearing as thoroughly as they could have otherwise.

Two points in response are worth noting. First, the Petitioners have not shown

that the limitations on access imposed by the Superintendent in fact caused any specific

prejudice to their ability to participate effectively in the proceeding. Second, beginning

the same day, June 12, the Superintendent began to release portions of Anthem's filing

from confidential status, allowing access by the public.

Paragraphs 4 and 5 of the Superintendent's June 12, 2013 Protective Order also

established a process for any party to challenge the designation of any material as

"confidential" or "attorneys' eyes only," by filing a motion to undo the designation, and a

separate procedure for anyone other than parties to challenge the designation. R.

2:2189. The challenge procedure in both instances included a very limited window of

opportunity for Anthem to contest the release of any material before the release

occurred. Id. at 2189, 2191.

On June 13, 2013, pursuant to the challenge procedure in the Protective Order,

another intervenor, the Maine Attorney General, filed a Motion for Immediate Public

Disclosure of attachments 1, 2 and 3 to the Anthem access plan filing, which constituted

lists of the individual and hospital providers in the proposed "narrow network", referred

to as "Provider Network Lists". R. 2225-26. Anthem opposed the Attorney General's

motion on the grounds that the "narrow network" was confidential trade secret

15
information, and the public did not need to know what providers were in the network

R. 2:2227-34. By Order dated June 17, 2013, the Superintendent overruled Anthem's

objection, granted the motion, and ordered the release of the Provider Network Lists to

the general public, including Petitioners, effective June 18, 2013. R. 2235-37.

On June 18, 2013, Anthem filed updates to its proposed provider lists for the

Guided Access HMO and Guided Access POS networks.

On June 20, 2013, the Intervenor Petitioners propounded their initial discovery

requests upon Anthem. R. 2:2285-88.

Also on June 20, 2013, the Superintendent issued 12 subpoenas for testimony at

the June 28 hearing at the request of the Intervenor Petitioners, directed to Anthem and

several hospitals in the proposed Guided Access HMO "narrow network," as well as

individuals affiliated with those entities. Anthem and some of those to whom the

subpoenas were directed moved to quash 11 of the 12 subpoenas (the other of which

having been withdrawn), and the Intervenor Petitioners opposed the motions. SeeR.

2:2360-2422. In a Consolidated Order dated June 26, 2013, the Superintendent, among

other decisions, declined to vacate the subpoena issued to Anthem; enforced with

modifications subpoenas issued to MaineHealth, a competitor of Petitioner CMHC, and

to two hospitals, and quashed duplicative subpoenas, i.e. those seeking multiple

witnesses from the same entity. R. 2:2423-28.

On June 21, 2013, the Intervenor Petitioners filed an Objection and Request to

Amend the Procedural Order and also an Objection to Protective Order and Request to

Amend the Protective Order. R.2:2344, 2352. Anthem filed an objection to both of the

Intervenor Petitioners' filings. R. 2: 2345-49.

16
The Intervenor Petitioners' objection to the Procedural Order asserted that the

Superintendent's schedule for the proceeding was "too contracted for the Intervenors to

meaningfully and effectively conduct discovery on the adequacy of the proposed

Network[,] to prepare their testimony, or to prepare for the hearing." R. 2:2.344. It

sought additional time for discovery, and for the pre-filing of testimony and exhibits,

and sought to delay the hearing.

In response, by Order dated June 25, 2013, the Superintendent extended the

deadline for pre-filing testimony and exhibits but otherwise denied the Intervenor

Petitioners' request, citing the impact of delaying the hearing itself and also the

Intervenor Petitioners' own delay in initiating discovery. R. 2:2350-51.

The Intervenor Petitioners' Objection to Protective Order was "on the basis that

[the Protective Order] continues to withhold documents from public disclosure....

Failure to make these documents available to the Intervenors and the limitation on their

use at hearing ... has made it incredibly difficult for the Intervenors ... " R. 2:2352.

The Superintendent responded in an Order dated June 25, 2013, granting the

Intervenor Petitioners' request to the extent of changing the designation for some

materials from "attorneys' eyes only" to "confidential," thereby enabling Intervenor

Petitioners' counsel to share the material with those with whom they were working to

prepare. R. 2:235.3-54. In other respects, the Superintendent denied the Objection. !d.

Also on June 21, 2013, the Superintendent supplemented the Notice of Pending

Proceeding and Hearing by issuing a Notice of Public Comment Session, setting a

public comment period for 5:30p.m. June 28. R. 2:2355.

On June 24, 2013, the Intervenor Petitioners filed a Notice of Claim Pursuant to

5 M.R.S. § 906.3, alleging bias on the part of the Superintendent. R. 2432-33. Section

17
9063 provides, in pertinent part: "Upon the filing in good faith by a party of a timely

charge of bias or of personal or financial interest, direct or indirect, of a presiding officer

or agency member in the proceeding requesting that that person disqualify himself, that

person shall determine the matter as a part of the record." 5 M.R.S. § 9063(1).

The claim of bias arose from a comment by the Superintendent's counsel in

another proceeding initiated by the non-Intervenor Petitioners other than Robert

Kimball. Central Maine Healthcare Corp. v. Bureau of Insurance, Ken. Super. Ct., Docket

No. AUGSC-AP-13-23 (now docketed in the Maine Business and Consumer Court as

Docket No. BCD-AP-13-03). The Notice of Claim quoted the Bureau's counsel as

saying in court June 19, 2013, "The Superintendent's view is that there should be more

than one plan in the exchange." R. 2:2432. The Intervenor Petitioners' Notice alleged

that the Superintendent's counsel's comment "strongly suggests that the

Superintendent has prejudged the ultimate issue in this proceeding, because if Anthem's

proposed plan is not approved, there will be only one plan in the exchange." R. 2:2432.

The Superintendent responded with an Order rejecting the claim of bias on the

same date. R. 2434-35. Treating the Intervenor Petitioners' Notice of Claim as a

motion to disqualify him, the Superintendent declined to recuse, but acknowledged that

"I believe it is in the public interest for Anthem to offer some type of health plan on

Maine's exchange." R. 2:2434. The Order noted that "Maine consumers would not be

well served" if there were only one plan on the exchange only because the State "ran out

oftime" to approve a second plan. Id. The Order pointed out that "the reason I have

expedited this proceeding is to account for the possibility that Anthem's proposed

network is not compliant with Maine's access standards," and to afford an opportunity

for any deficiencies to be corrected. Id. (emphasis in original). "If this proceeding were

18
the rubber stamp that [the Intervenor Petitioners] allegeD, there would have been no

need to build in extra time to allow for Anthem to potentially resubmit its access plan."

Id. In "reject[ing] any charge of bias, direct or indirect, in this proceeding," the

Superintendent's Order noted that, "While I have restructured these proceedings to

ensure that Anthem has a reasonable opportunity to come up with a state-law compliant

plan, I have no intention of approving any plan that does not provide the access to

health care services required by Maine law, even if it means fewer plans on Maine's

exchange." R. 2:2435.

On June 25, 2014, the Superintendent directed that Anthem's managed care

accessibility analyses filed with its access plan filing be made public, leaving S9 pages of

Anthem's original access plan filing still designated as "attorneys' eyes only." The S9

pages consisted of provider contracts that the Superintendent determined were entitled

to be withheld based on Anthem's trade secret claim.

On June 27, 201S, the Intervenor-Petitioners filed Intervenors' Procedural

Objections and Offer of Proof, in response to the Superintendent's procedural orders up

to that point. R. 2:2448-50. Their objections focused on the continued withholding of

some of Anthem's filing; on the Superintendent's refusal to enforce some ofthe

Intervenor Petitioners' discovery requests and subpoenas for hearing, as well as on the

"unreasonably contracted schedule" for the entire proceeding, all allegedly in violation

of the Maine Administrative Procedure Act, the Maine Bureau oflnsurance rules of

practice, and the Intervenor Petitioners' right to due process. Id. Their offer of proof

indicated that, had the Intervenor Petitioners been permitted to obtain the evidence

they had sought to subpoena, they could establish that MaineHealth, a competitor of

CMHC, rather than Anthem, had designed Anthem's proposed network, and had done

19
so based on MaineHealth's own interests rather than based on subscriber needs or

standards for assuring adequate access to services. R. 2:2449-50.

D. The Hearing

The evidentiary hearing commenced, as scheduled, on June 28.

On Anthem's motion, the Superintendent admitted into evidence an updated

version of Anthem's entire Access Plan. In addition, Anthem moved to admit the pre-

filed testimony of two witnesses, Colin McHugh, Anthem's Regional Vice President of

Provider Engagement and Contracting, and William Whitmore, Anthem's Regional

Vice President of Underwriting. However, based on objections by the Intervenor

Petitioners, the Superintendent struck as irrelevant certain portions of testimony

discussing Anthem's business reasons for "narrowing" or downsizing its provider

network. (R. 2:2601 & n.9.)

The hearing focused largely on the adequacy of Anthem's proposed access plan

for the Guided Access HMO products. The Intervenor Petitioners challenged adequacy

on multiple fronts, including the accuracy of the Anthem's provider lists and the

sufficiency of Anthem's accessibility analyses. The Intervenor Petitioners offered three

witnesses affiliated with the provider Petitioners. (R. 5:6/28 Tr. 21S; see also R. 2:2208

~ 16.) As noted above, the Intervenor Petitioners had caused 12 subpoenas to be

issued for individuals and entities to give testimony at the hearing, and some of the

subpoenas were upheld against motions to quash them. However, the Intervenor

Petitioners did not question any of those whom it had caused to be subpoena'ed. R.

5:6/28:224:15-16.

At the close of the June 28 hearing, the Superintendent requested that Anthem

provide updated provider lists that indicating which practices would accept new patients

20
and also whether the provider was already under contract with Anthem or was being

"aspirationally" included in the network lists. R. 5:6/28:2S7-240. During the public

comment period at the end of the day, six non-party members of the public testified. R.

5:6/28:26S-277.

On June so, Anthem filed with the Superintendent revisions to its access plan

exhibits along with a written submission titled Anthem's Response to Hearing Request,

explaining the revisions. R. 2:246S-67, R. SC:4S77-4644. Anthem's supplemental

filing stated that the physicians and hospitals in Anthem's proposed network "will take

all new patients that are covered by the products that use the proposed network." R.

2:2466. It also included updated patient:provider ratios for PCPs and high volume

specialists, reflecting only minor changes from those originally filed. R. 2:2465.

Anthem's filing also included complete provider networks (including multiple provider

addresses, where applicable) for the Guided Access HMO and Guided Access POS

products. R. SC:4S77-5104 (Anthem Exs. 9 and 10).

Upon reviewing Anthem's revised submission, the Superintendent determined

that a second day of hearing was necessary. On July 1, 201S, the Superintendent issued

an Order to Reconvene the Hearing on July 2, 201S for the purpose of enabling

Anthem's June SO filings to become part of the hearing record, and to allow direct and

cross-examination of an Anthem witness regarding those filings. R. 2:2468.

On July 2, 201S, the Intervenor Petitioners filed a written objection to the Order

Reconvening the Hearing and reasserted their claim ofbias pursuant to 5 M.R.S. §

906S. R. 2:2469.

At the July 2 hearing, the Superintendent overruled the renewed objections of

the Intervenor Petitioners, in which other intervenors had by then joined. R. 5:7/2:6-7.

21
Thereafter, on direct examination by Anthem, Anthem's witness provided a detailed

explanation of the steps that he had taken to revise Anthem's filings, and other parties

were given the opportunity to cross-examine. R. 5:7/2:8-28. At the end of the July 2

hearing, the Superintendent closed the record, and set deadlines for the parties to

submit post-hearing briefs. R. 5:7/2:68.

On July 16, 201S, after the parties had submitted post-hearing briefs, the

Superintendent issued an Order To Re-Open The Record For The Limited Purpose Of

Taking Official Notice, citing as authority for his action Insurance Rule S50( 19)(C). R.

2:2514. The areas on which the July 16 Order re-opened the record for purposes of

official notice related to a Harvard Pilgrim Health Care filing; the provider network

data for another Anthem product, the BlueChoice PPO small group plan, and the fact

that Anthem's BlueChoice PPO small group plan includes "a typical, broad network that

has been approved by the Superintendent." Id.

On July 18, 2015, Intervenors filed a written objection to the proposed re-

opening of the record on several grounds: that the Order To Re-Open was insufficiently

specific on what information from the two identified sources the Superintendent was

proposed to consider, and that subject matter covered by the Order To Re-Open was

not an appropriate use of official notice. R. 2:2515-17.

E. The Superintendent's Decision and Amended Decision

On July 25, 201S, the Superintendent issued his Decision and Order, finding that

the proposed Anthem Network provided "reasonable access to medical services" for

subscribers and, approved the Anthem Guided Access HMO and POS products, subject

to specified conditions. R. 2:2551-2581. The Superintendent issued an Amended

Decision and Order ["Amended Decision"] on August 6, 201S, repeating the same

22
ultimate finding and approvals, again with conditions. R. 2:2582-2643. The stated

purpose of the Amended Decision was to correct an error in the original Decision and

Order involving a particular specialty in one county. R. 2:2582 n.1, 2:2600-01.

The first sections of the Superintendent's 62-page Amended Decision cover the

procedural history of Anthem's application for approval of its Guided Access HMO and

POS products to the point of hearing. R. 2:2584-2602. The Amended Decision explains

the governing legal framework, which primarily rests on the provisions of 24-A M.R.S.

§4303( 1) and Insurance Rule 850(7). R. 2:2603-07.

The section of the Amended Decision and Order titled Analysis, Findings, and

Conclusions includes a detailed discussion of the record evidence and explains the

Superintendent's ultimate finding and conclusion that Anthem's proposed access plans

for the Guided Access products comply with the requirements of section 4303(1) and

Insurance Rule 850(7). The Superintendent's analysis is discussed in more detail below.

Based on the analysis, the Amended Decision and Order identified 14 separate

conditions that Anthem would be required to satisfy in order for its proposed Guided

Access HMO "narrow network" to be deemed capable of providing reasonable access to

health care services for purposes of the applicable insurance statute and rule. R.

2:2641-42. The Superintendent approved Anthem's access plan for the Guided Access

HMO products subject to those conditions. Id.

In a section titled Matters Yet to be Considered, the Superintendent also explicitly

flagged an issue not subsumed in the Amended Decision and Order, arising "from the

fact that Anthem is proposing to move large numbers of current members ... into these

new HMO products. In order to move its current membership into these new products,

Anthem has to demonstrate not only that the new products meet basic standards for

23
reasonable access, but also that moving members from broad-network products into

narrow-network products will be "in the best interests of the policyholders." 24-A

M.R.S. 2850-B(G)(s)(b)." R. 2:2640.

The Amended Decision and Order states:

Simply because I am permitting Anthem to offer these narrow-network plans for
sale in Maine does not necessarily mean I will also permit Anthem to move its
current customer base into these plans .... I will shortly be issuing a Notice of
Hearing, scheduling a hearing on the latter question for September 9, 201S. To
demonstrate that these proposed HMO plans are in the best interests of their
current policyholders, Anthem will have to demonstrate that, for current
members, the reduced choice in these new plans is offset by a corresponding
benefit, presumably in the form oflower rates than what members would
otherwise pay.

R. 2:2641.

F. Stay Request and Appeal

On August 16, 201S, the Intervenor Petitioners requested that the

Superintendent stay his approval,. R. 2644-2650. The request was denied in an Order

on Stay issued August 27, 201S. R. 2:2651-55.

The Petition for Judicial Review of Final Agency Action in this case was timely

filed on September 5, 2015.

III. Analysis

A. Standard of Review

In an appeal of a final agency action under M.R. Civ. P: soC and 5 M.R.S. §

I1007(C) (2012), the court reviews an agency's decision "for error of law, abuse of

discretion, or findings not supported by substantial evidence in the record." Goodrich v. ·

Me Pub. Emps. Ret. Sys., 2012 ME 95, ~6, 48 A.5d 212. The Board's decision may also

be reversed if it was in excess of statutory authority, or was made upon unlawful

procedure. 5 M.R.S.§ 11007(C)(l)-(s).

24
The court will "not attempt to second-guess the agency on matters falling

within its realm of expertise" and judicial review is limited to "determining whether the

agency's conclusions are unreasonable, unjust or unlawful in light of the record."

Imagineering, Inc. v. Sup't if Ins., 593 A.2d 1050, 1053 (Me. 1991). The party seeking to

vacate the agency's decision has the burden of proving the agency's decision is clearly

erroneous. Douglas v. Bd. ifTrs. ifthe Me. State Ret. Sys., 669 A.2d 177, 179 (Me. 1996).

The appellant seeking judicial reversal of an agency's fact-finding determination

assumes a significant burden. A court will not overturn the agency's fact-finding unless

the party seeking to overturn the agency's decision demonstrates that the

administrative record compels a contrary result "to the exclusion of any other

inference." Id. at 179. The court must affirm findings of fact if, on the basis of the entire

record before it, the agency could have fairly and reasonably found the facts as it did."

Seider v. Bd. ifExam'rs if Psychologists, 2000 ME 206, ~9, 762 A.2d 551, 555. A court is

not entitled to substitute its judgment for that of the agency, "merely because the

evidence could give rise to more than one result." Dodd v. Sec. if State, 526 A.2d 583,

584 (Me. 1987). Rather, the court may consider only whether "the agency's decision is

supported by substantial evidence on the whole record." Id.

This standard requires the party seeking to overturn an agency decision to

prove there is no competent evidence in the record to support [the agency's] decision."

Friends if Lincoln Lakes v. Bd. of Envtl. Prot., 2010 ME 18, ~ 14, 989 A.2d 1128.

Conversely, if any competent evidence supports the agency's findings, its decision must

be upheld "even if the record contains inconsistent evidence." Id. at ~ 13, 989 A.2d 1128.

Furthermore, the credibility determination of witnesses is in the exclusive province of

25
the agency and should not be disturbed on appeal. See Sprague Elec. Co. v. Me. Unemp't

Ins. Comm'n, 544 A.2d 728, 7S2 (Me. 1988).

With respect to interpretation, a court will interpret a statute according to its

plain meaning, without examining legislative history or giving deference to the Board's

construction. Whitney v. Wal-Mart Stores, Inc., 2006 ME S7, ~~ 22-23, 895 A.2d S09;

Dombkowski v. Ferland, 2006 ME 24, ~22, 89S A.2d 599 (holding that a court's ultimate

objective when interpreting a statute is to "effectuate the intent of the Legislature,

which is ordinarily gleaned from the plain language of the statute"). In doing so, a court

will consider the language in the context of the whole statutory scheme and construe

the statute to avoid absurd, illogical, or unreasonable results." FPL Energy Me. Hydro

LLC, ~ 12, 926 A.2d 1197.

B Issues Presented

The Petitioners have briefed the following grounds for appeal, listed here in the

order in which they appear in Petitioners' brief on appeal:

• bias on the part of the decision maker, based specifically on the Superintendent's
announced view that it would be preferable for more than one QHP to be
available to Maine consumers on the ACA exchange for plan, including
Anthem's proposed Guided Access products if they qualified for approval under
Maine law. However, Petitioners' claim that the Superintendent's conduct of the
proceeding in its entirety also reflected bias.

• the Superintendent's denial of the request for stay made by the non-Intervenor
Petitioners

• the alleged insufficiency ofthe notice given by the Superintendent, in light of the
notice requirements of the Maine APA, 5 M.R.S. § 9052

• the Superintendent's alleged violation of the "official notice" provisions of the
MaineAPA

• the Superintendent's alleged denial of discovery to the Intervenor Petitioners

• erroneous evidentiary rulings by the Superintendent during the hearing

26
• errors oflaw relating to the Superintendent's reliance on "member" ratios in
determining network adequacy; the alleged improper allocation of the burden of
persuasion on availability of hospital services, and interpretation of "reasonable
access" as it relates to access to tertiary care hospital services.

• findings not supported by substantial evidence in the record regarding access to
hospital services and specialty physician services, and regarding the capacity of
participating hospitals and participating PCPs

Because the Petitioners' assertion ofbias encompasses the Superintendent's

conduct of the entire proceeding, all oftheir other arguments are more or less

incorporated by reference within their bias argument. Accordingly, this Decision and

Order addresses the bias issue last, but otherwise covers the issues in the order just

listed.

C. Denial of Request for Stay

For two reasons, the court upholds the Superintendent's denial ofthe request for

stay made by the non-Intervenor Petitioners.

One ground for upholding the denial of the Motion for Stay is based on the

movants' lack of standing. As noted in the Superintendent's denial order, the movants

did not seek leave to intervene, and thus, as non-parties to the proceeding, lacked

standing to seek a stay or postponement. The Motion For Stay contends that the

movant non-Intervenor Petitioners were unable to determine whether they should

intervene because, as ofthe date of the Motion, the Superintendent was withholding

most of Anthem's application as confidential. R. 2:2209. If the non-Intervenor

Petitioners indeed had no meaningful opportunity to intervene, due process

considerations might trump the absence of standing. However, the record does not

indicate such to be the case.

27
The Superintendent's June 12 deadline for intervention was not an absolute

deadline; the Notice allowed for petitions to intervene filed after the deadline to be

granted upon a showing of "good cause," R. 2:2167, later clarified to be a "compelling

showing of good cause." R. 2:2180. The non-Intervenor Petitioners did not seek leave

to intervene at any time, including after the Superintendent lifted the confidentiality

restriction from most of Anthem's filing.

The fact that some of the Petitioners, including two affiliate hospitals of non-

Intervenor Petitioner CMHC, did choose to intervene, and the further fact that the same

attorney signed and filed the Petition to Intervene on behalf of the Intervenor

Petitioners the day before signing and filing the Motion for Stay on behalf of the non-

Intervenor Petitioners, seeR. 2:2203, 2209, compel the inference that the non-

Intervenor Petitioners made a calculated choice to file their Motion for Stay instead of

joining in the Petition to Intervene.

The other ground for upholding the Superintendent's denial of the Motion for

Stay is that the record demonstrates the decision to be a reasonable exercise of the

Superintendent's discretion, in light of what he clearly understood to be a very limited

timeframe within which to consider Anthem's application for approval of its Guided

Access products.

The Superintendent's denial decision points out that the Motion for Stay was

actually a request for continuance, there being no final agency action to be stayed. R.

2:2213. To the extent the Motion for Stay also was sought to extend various deadlines,

including the deadline for requests to intervene, it could also be viewed as a motion for

enlargement of time.

28
Given that Anthem's network access filing was made barely two months before

what the Superintendent understood to be the federal deadline for state action on QHP

applications, that granting the non-Intervenor Petitioners' Motion for Stay would have

imperiled, if not eliminated, the Superintendent's ability to review and act on Anthem's

application by the deadline.

It seems clear that the timing of Anthem's network access filing put everyone-

the Bureau oflnsurance, the Petitioners, the healthcare community, the public, and

Anthem itself, as the party bearing the burden on the ultimate issue-in a difficult

position. 6 Although Petitioners have questioned whether the Superintendent's review

of Anthem's application in fact had to be completed by JulyS 1, 2013 in order for

Anthem's Guided Access products to have any chance of being certified by CMS and

included in the ACA exchange for Maine, nothing in the record suggests that the

Superintendent was mistaken in his understanding that "[t]he federal government has

set July 31, 2013 as the deadline for state recommendations for federal certification of

Qualified Health Plans." R. 2:2211.

Thus, the Superintendent had essentially three options in dealing with Anthem's

application for approval of its proposed Guided Access HMO and POS networks. The

two options that would enable Anthem's application to be acted upon by the JulyS 1

deadline were for the Superintendent either to act on the application without convening

6 The record is silent on why Anthem's network access filing was filed when it was.
Petitioners' suspicion that Anthem delayed its filing in order to avoid public scrutiny finds some
support in Anthem's initial insistence that its entire network access filing, even the existence of
the cover letter, be withheld from public knowledge. On the other hand, other factors suggest
that Anthem's filing was not made later than it could have been. Anthem's filing obviously was
the product of a massive and sustained effort to assemble an adequate network; Anthem's filing
had to be revised during the proceeding, and Anthem, as the applicant, had more to lose than
any other party to the proceeding if time ran out before the Superintendent could act on
Anthem's application.

29
a hearing or proceeding under the Maine APA, or to convene and complete such a

proceeding on an radically compressed schedule.

The Superintendent's third option-the one that the Motion For Stay sought--

was to ignore the CMS deadline and conduct a review process on a significantly more

extended and less compressed schedule. Such a schedule risked defeating the entire

purpose of the proceeding because it would delay action on Anthem's proposed products

beyond the CMS deadline.

Thus, the Superintendent's decision to convene a hearing on a schedule that

could enable him to act on Anthem's application by the July .31 deadline represents a

middle path that balanced the benefit to the public interest of an public and adversarial

test of Anthem's filing against the benefit to the public interest of allowing a second

potential plan to go through the approval process in time to qualify for the exchange if

it passed muster.

The Superintendent's choice of the middle path more or less necessitated

denying the non-Intervenor Petitioners' Motion For Stay as well as adopting the

compressed schedule for the proceeding about which other Petitioners-those that did

intervene-complain.

Under Insurance Rule .350(1.3)(G) and also by law, requests for continuance or

enlargement of a Bureau proceeding are addressed to the Superintendent's discretion.

Judicial review of an agency's denial of a request to continue is for abuse of discretion.

See Waxler v. Maine Real Estate Comm'n, 1998 ME 65, ~4, 708 A.2d 66.3; Magno v. Town

cifFreeport, 486 A.2d 1.37, 140 (Me. 1985). Under the circumstances, the

30
Superintendent's denial of the non-Intervenor Petitioners' Motion for Stay was well

within his discretion. 7

D. Sufficiency of Notice

Petitioners challenge the sufficiency of the notice provided by the

Superintendent under the Maine Administrative Procedure Act.

The Act contains two distinct notice provisions-one addressing notice to

persons "whose legal, rights, duties or privileges" are at issue in the proceeding, and the

other covering notice to the public ofproceedings involving issues of"substantial public

interest."

The former provision requires that notice be provided "to the person or persons

whose legal rights, duties or privileges are at issue, by regular mail, sufficiently in

advance of the anticipated time of the decision to afford an adequate opportunity to

prepare and submit evidence and argument, and to request a hearing if so desired." 5

M.R.S. § 9052(l)(A). The latter provision requires that notice be given, "in any

proceeding deemed by the Agency to involve a determination of issues of substantial

public interest, to the public sufficiently in advance of the anticipated time of the

decision to afford interested persons of adequate opportunity to prepare and submit

evidence and argument, and to request a hearing if so desired." Id. § 9052(l)(B).

Petitioners assert that "[t]he Superintendent committed errors oflaw by failing

to provide proper Maine Administrative ProcedureO Act notice both to persons whose

legal rights, duties or privileges were at issue and to the general public." Petitioners'

Brief at 17.

Their brief frames the operative question as follows:

7
The same analysis applies to the Superintendent's denial of a similar motion filed by York
Hospital, which is not a party to this appeal. SeeR. 2:2216-19.

31
Here, the question is whether the Bureau's issuance on June 6, 2013 of a Notice
of Proceeding and Hearing setting a deadline for intervention of 3:00 p.m. on
June 12, 2013 and setting a hearing date for June 28, 2013, where several
documents explaining the contours of the application and accordingly the
intervention rights of non-parties, sufficiently apprised interested parties and the
public of the nature of the matter and of their potential rights to intervene.

Petitioners' Brief at 18.

With regard to section 9052(1 )(A), requiring notice by regular mail to persons

"whose legal rights, duties or privileges are at issue," the Petitioners assert that

"[t]here are many individuals whose 'legal rights, duties and privileges' were at issue in

this matter," without identifying who those individuals are. See Petitioners' Brief at 18-

19. However, the court is not persuaded that any of the Petitioners was entitled to

regular mail notice of the "narrow network" access proceeding under section 9052(1)(A).

Beyond the right to participate or to request leave to intervene enjoyed by any member

the public, the provider Petitioners have not shown that they have any right or privilege

to be included in Anthem's proposed Guided Access HMO "narrow network." Similarly,

the non-provider Petitioners have not shown that they have any right or privilege to

have their preferred provider hospitals or physicians included in the Guided Access

HMO network. In short, none of the Petitioners has demonstrated standing to assert

that they were entitled to receive notice of the proceeding, as "persons whose legal

rights, duties or privileges are at issue, by regular mail ... " for purposes of section

9052(1)(A) of the Maine APA.

Accordingly, the court's sufficiency of notice analysis focuses on section

9052(1)(B), which addresses notice to the public.

The Maine APA does not mandate any particular lead-time for notice to

interested parties or the public. Section 9052( 4) does specify the contents of an agency's

32
notice, but Petitioners do not assert that the Superintendent's Notice lacked any of these

formal requisites. 8 Thus, their claim distills essentially to a due process claim. The due

process standard regarding notice is functionally similar to the statutory standard in the

Maine AP A. See Guarantee Trust Life Ins. Co. v. Sup 't of Insurance, 2013 ME 102, ~ 3 5,

82 A.3d 121 ("Due process requires that a party to an administrative action be on notice

as to the statutory provisions and issues involved in an adjudicatory proceeding

sufficient to provide an opportunity to adequately prepare and present evidence"). See

also Berry v. Me. Pub. Utils. Comm'n, 394 A.2d 790, 793 n.4 (Me.l978).

In considering challenges to the sufficiency of notice generally, the Law Court

has applied a flexible approach to the timing of notice, cf. Crispin v. Town cif Scarborough,

1999 ME 112, ~~26-27, 736 A.2d 241 (one-day notice of meeting sufficient under

Freedom of Access Law), and has focused on actual prejudice or harm to the party

claiming insufficiency of notice. See Antler's Inn & Restaurant, LLC v. Dep't cifPub.

Safety, 2012 ME 143, ~ 12, 60 A.sd 1248 ("Were we to address the notice issue on its

merits, we would hold that the deficiencies in the Department's notice constitute

harmless error in the circumstances presented by this case").

The general rule is that "[o]ne who appears in an administrative proceeding

without the notice to which he is entitled by law has no grounds to complain oflack of

notice." Kovack v. Licensing Bd. cifCity if Waterville, 173 A.2d 554, 559-60 (Me. 1961).

8
Section 9052(4) does require a notice to contain "six pieces ofinformation: (1) the legal and
jurisdictional authority for the proceeding, (2) the statute or rule involved, (S) the nature and
purpose ofthe proceeding and "the matters asserted," (4) the time and place ofthe hearing, (5)
how evidence and argument can be submitted to the agency, and (6) how a person may
intervene in the proceedings." Antler's Inn & Restaurant, LLC v. Dep't of Pub. Safety, 2012
ME 143, ~ 10, 60 A.Sd 1248, citing 5 M.R.S. § 9052(4). Petitioners do not assert that the Notice
as published by the Superintendent lacked any of the six.

33
Here, some of the Petitioners did intervene and fully participated in the hearing,

so any deficiency in the Superintendent's Notice or the publication thereof is harmless as

to them. Other Petitioners did not intervene. Although the non-Intervenor Petitioners

claim that their failure to intervene was the result of not knowing whether they should

intervene or not, the fact that some of the Intervenor Petitioners are affiliates of some of

the non-Intervenor Petitioners, and the fact that the same attorney signed the

Intervenor Petitioners' request to intervene a day after signing the Motion for Stay filed

by the non-Intervenor Petitioners, compel the inference that the non-Intervenor

Peti.ioners who moved for a stay could have intervened but did not.

Moreover, as noted above, the June 12 deadline by to intervene was not

insuperable, if a compelling showing of good cause were made. As of June 18, the

provider lists were made public. For those reasons, the court concludes that the

Intervenor Petitioners and those of the non-Intervenor Petitioners who joined the

Motion for Stay have not shown any due process issue, and that any deficiency in the

timing ofpublication of the Superintendent's Notice was harmless error as to them.

The only other named Petitioner, Robert Kimball, neither intervened nor moved

for a stay. (Nor did the Petitioners identified as John Doe and Jane Roe). He did not

appear at the public hearing, despite having about two weeks from the publication of the

Notice to prepare for and attend the hearing.

As Anthem's briefpoints out, the record is silent as to whether Mr. Kimball (and

the Doe/Roe Petitioners) received actual notice of the public hearing. Lack of actual

notice does not render notice deficient. In other words, to comply with section

9052(1 )(B) and the requirements of due process, the Notice did not have actually to

come to the attention of every member of the public, every health care provider, every

34
Anthem subscriber or every person who might purchase one of the approved QHPs on

the ACA exchange for Maine.

As to Petitioners' contention that the confidential status of Anthem's filing

precluded them from meaningful participation, the Superintendent made Anthem's

proposed "narrow network" and provider lists public effective June 18, 2014, ten days

before the hearing. No requests to intervene were received after June 18, and the public

hearing attracted a small number of speakers, including several of the Petitioners.

For all of these reasons, this court concludes that the Notice ofPending

Proceeding and Hearing was sufficient, both in its form and in its manner of publication,

for purposes of the Maine APA and due process, and that the Petitioners' challenge

based on insufficiency of notice must be denied.

E. The Alleged Violation of 5 M.R.S. § 9058, Regarding "Official Notice"

The Petitioners allege that the Superintendent violated 5 M.R.S. § 9058 by

taking official notice in his Amended Decision of a Harvard Pilgrim Health Care

(HPHC) report filed with the Bureau of Insurance; the provider network data for

another Anthem product, the BlueChoice PPO small group plan, and the fact that

Anthem's BlueChoice PPO small group plan includes "a typical, broad network that has

been approved by the Superintendent."

Section 9058 of Maine Administrative Procedures Act at provides that:

agencies may take official notice of any facts of which judicial notice could be
taken, and in addition may take official notice of general, technical or scientific
matters within their specialized knowledge and of statutes, regulations and non-
confidential agency records. Parties shall be notified of the materials so noticed,
and they shall be afforded an opportunity to contest the substance or materiality
of the facts noticed.

In an Order To Reopen the Record For the Limited Purpose ofTaking Official

Notice dated July 16, 2013, the Superintendent notified the parties of the material of

35
which he intended to take official notice. R. 2:2514. 9 The Order provided specific

internet URLs for the HPFC filing and for the BlueChoice PPO small group plan

provider network. See id. It also afforded the parties a limited opportunity "to contest

the substance or materiality of the matters identified." Id.

In response to the Order, the Intervenor Petitioners filed a Request for

Clarification and Opposition to Order to Reopen The Record and To Take Official

Notice. R. 2:2515. Their primary objections were that the HPHC and Anthem

materials cited in the Superintendent's Order To Reopen were private party information

and data rather than data developed by the Bureau, and also that the Order To Reopen

was not sufficiently specific as to what particular data the Superintendent intended to

rely upon from among "the thousands of data points" within the HPHC and Anthem

materials. See id.

In his Amended Decision, the Superintendent ruled that he would take official

notice of the HPHC report and the Anthem BlueChoice PPO provider network, as well

as of the premise that Anthem's BlueChoice PPO "includes a typical, broad network that

has been approved by the Superintendent." R. 2:2602 (Amended Decision at 21 ). In a

footnote, the Superintendent explained how the three noticed matters figured in his

analysis:

Official notice of Anthem's existing BlueChoice PPO provider network does not
constitute a finding by the Superintendent that the provider directory is
accurate. The BlueChoice provider directory is subject to the same concerns
that were raised on the record regarding Anthem's proposed 2014 HMO
provider directory. Official notice is taken, rather, for the limited purpose of
illustrating the "broad" network to which the proposed "narrow" network has
been implicitly compared by all parties to this proceeding. Likewise, HPHC's
Rule 945 report has not been audited, and is admitted for the limited purpose of

9
The HPHC and BlueChoice materials referred to in the Order To Reopen were marked as
Superintendent's Exhibits 1 and 2 and appear in the record in Binder sE. R. s£:5271-5867.
36
providing a public record that reports the enrollment in Dirigo Choice, which
was introduced by intervenor testimony but not quantified."

R. 2:2602 (Amended Decision at 21 n.10).

Later in the Amended Decision, the Superintendent cited to the HPHC filing to

support a finding about enrollment in Dirigo Health, seeR. 2:2617-18 (Amended

Decision at 36-37 & n.25), a statistic he deemed relevant, among others, in projecting

likely individual enrollment in Anthem's Guided Access HMO products. See id. The

Superintendent utilized the BlueChoice PPO plan in the course of evaluating the

adequacy of Anthem's proposed Guided Network HMO provider network specifically as

it relates to pediatric services for Sagadahoc and Androscoggin counties. SeeR. 2:2622

(Amended Decision at 41 & n.28). It was because the original Decision misinterpreted

the BlueChoice PPO data as it pertained to in-network pediatricians for Sagadahoc

County that the Superintendent had to issue the Amended Decision. SeeR. 2:2582

(Amended Decision at 1 n.1).

In their brief on appeal, the Petitioners summarize their objection to the

Superintendent's taking of official notice as follows:

[B]ecause the noticed documents were not those on which it was permitted to
take notice, and because the order setting forth the documents to be noticed was
not sufficiently specific, the Superintendent's re-opening and taking notice of
these items violated 5 M.R.S. §9058 and was an error oflaw.

Petitioners' Brief at 21.

The court's view is that the Superintendent could take official notice of the

HPHC report and BlueChoice network data. Section 9058 confers broad discretion on

an agency, and the HPHC report and the Anthem data are well within the scope of the

"general, technical or scientific matters within [the Bureau oflnsurance's] specialized

knowledge" for purposes of section 9058.

37
However, this court agrees with the Petitioners that the Superintendent erred in

failing to specify the particular information contained in the HPHC report and the

BlueChoice PPO provider network of which he intended to take official notice. As to

the BlueChoice PPO material, the Order To Reopen the Record For the Limited

Purpose ofTaking Official Notice did indicate that the Superintendent intended to take

notice that the BlueChoice PPO reflects "a typical, broad network that has been

approved," R. 2:2524, but the Order said nothing about why the HPHC report was

being singled out, or what within the report would be made the subject of official notice.

The purpose of the section 9058 requirement of notice and opportunity to

contest is to afford the parties a meaningful opportunity to contest the particular facts

or information that the agency proposes to make the subject of official notice. As a

federal court has aptly observed,

When courts allow agencies, as we do, wide latitude in taking official notice, it is
essential that the parties be afforded an opportunity to present information
which might bear upon the propriety of noticing the fact, or upon the truth of
the matter to be noticed. Banks v. Schweiker, 654 F.2d 637,641 (9th Cir.1981)
(quoting C. McCormick, Law of Evidence§ 333 at 771 (2d ed. 1972)). See also
Carson Products Co. v. Califano, 594 F.2d 453, 459 (5th Cir.1979) ("It is a
fundamental proposition of administrative law that interested parties must have
an effective chance to respond to crucial facts."). Such fairness concerns appear to
have motivated the drafters of Federal Rule of Evidence 201(e), which provides
litigants in federal court with just such an opportunity to rebut judicially noticed
facts. See Fed.R.Evid. 201, Notes of Advisory Committee on 1972 Proposed
Rules ("Basic considerations ofprocedural fairness demand an opportunity to be
heard on the propriety of taking notice"). We note, finally, that not to allow
petitioners an opportunity to rebut noticed facts would sanction the creation of
an unregulated back door through which unrebuttable, non-record evidence
could be introduced ... outside of the statutorily-mandated hearing context.

Kaczmarczyk v. INS, 933 F.2d 588 (7th Cir.), cert. denied, 502 U.S. 981(1991)
(internal quotes and ellipses omitted).

38
The Superintendent's Order To Reopen was vague and general to the point of

failing to afford any of the parties a meaningful opportunity to contest the accuracy of

the information.

On the other hand, the Petitioners' objection avails them naught. Now that the

Decision and Amended Decision have revealed precisely how the Superintendent has

relied on the HPHC and BlueChoice materials, the Petitioners do not challenge the

accuracy of the information ofwhich official notice was actually taken in the decision.

Moreover, the findings in the Amended Decision that are supported by the HPHC and

BlueChoice PPO material are not essential to the outcome. Accordingly, because the

error of which the Petitioners complain is harmless, it does not advance their appeal.

F. Alleged Denial of Discovery

Petitioners assert that the Superintendent erred in sustaining some of Anthem's

objections to the Intervenor Petitioners' discovery requests. See Petitioners' Brief at 21-

22. The Superintendent's action is reflected in his Order On Anthem's Objections to

Intervenors' First Information Request. R. 2:2.'3 16-21.

Although the Petitioners' objection to the Superintendent's discovery order is

broadly phrased, the only specific area of discovery alluded to in Petitioners' Brief has to

do with their "discovery including communications among Anthem's employees

regarding the development ofthe geographic access plan." Petitioners' Brief at 22.

Accordingly, the court limits its focus to that area. See Mehlhorn v. Derby, 2006 ME 110,

~ 11, 905 A.2d 290 (issues not addressed in a more than perfunctory manner on appeal

are waived).

In fact, the Superintendent's Order did require Anthem to respond to the

portions of Requests Sand 4 of the Intervenor Petitioners' First Information Request

39
relating to communications within Anthem about geographic access to providers and

geographic distribution ofproviders. SeeR. 2:2317-18. However, the Superintendent

sustained Anthem's objection to a request for information about how individual

providers were selected for the Guided Access HMO network on the ground that the

individual selection process was irrelevant to the ultimate issue in the proceeding-

adequacy of the network. See id.

Overall, the Superintendent's discovery order reflects a detailed, selective

approach rather than the broad-brush denial of discovery implied by the Petitioners. Of

the 21 numbered requests, the Superintendent upheld Anthem's objection in full to only

three.

Moreover, the Intervenor Petitioners have not substantiated their assertion that

the Superintendent's rulings during the hearing were contrary to his rulings on

discovery. At the inception ofthe first day, the Intervenor Petitioners objected to

portions of Anthem's prefiled testimony on the ground that it covered issues that they

were precluded from exploring in discovery. SeeR. 2:6/28:13, 15-16,20-21. The

Superintendent took the objections under advisement, indicating that they would be

addressed in his decision. SeeR. 2:6/28:25. The Amended Decision largely sustains the

Intervenor Petitioners' Objections. SeeR. 2:2601 (Amended Decision at 20 & n.9).

An agency's discovery determinations are reviewed "with great deference" for

abuse of discretion. McAdam v. United Parcel Service, 2001 ME 4, ~ 34, 763 A.2d 1173.

The Petitioners have not demonstrated any abuse of discretion in the Superintendent's

discovery determinations during the proceeding.

40
G. Challenged Evidentiary Rulings

Petitioners also challenge evidentiary rulings by the Superintendent during the

hearing. Petitioners' Brief at 2.'3-24.

Section 9057 of the Maine AP A prescribes the general rule for the admission of

evidence in a state agency proceeding: "Evidence shall be admitted if it is the kind of

evidence upon which reasonable persons are accustomed to rely in the conduct of

serious affairs." 5 M.R.S. § 9057(2). The same section specifically says that "agencies

need not observe the rules of evidence observed by courts." I d. § 9057( 1).

Petitioners' objections to evidentiary rulings mainly assert that the

Superintendent improperly admitted testimony and exhibits for which insufficient

foundation had been established. "As a result, those who actually created exhibits

could in effect testify through the exhibits without being sworn and subject to cross-

examination." Petitioners' Brief at 24. When the Superintendent responded to

Petitioners' foundational objections by inviting Anthem to lay a foundation, Petitioners

objected to that as well, claiming Anthem should be limited to its preflied testimony.

See R. 5:6/28:26.

In addition to the Maine APA incorporating a comparatively liberal evidentiary

standard, it confers upon the agency broad discretion in deciding what evidence to

admit. The Superintendent's decision to allow Anthem to elicit foundational testimony

in response to the Intervenor Petitioners' foundational objections was well within his

discretion. A party need not anticipate in its preflied testimony every objection that

might be made.

As the Bureau's briefpoints out, the Petitioners' foundational objection became

largely mooted when it turned out that Anthem had flied an incorrect Guided Access

41
HMO network provider list as a June 28 hearing exhibit, and was directed to replace it

with an updated and correct list. SeeR. 5:6/28:237-40. See also R. 2:2464, 2468.

Petitioners have not shown that the Superintendent's Amended Decision should

be overturned or otherwise affected by any of the Superintendent's evidentiary rulings

during the hearing.

H. Alleged Errors Of Law Relating To The Superintendent's Reliance On "Member"
Ratios In Determining Network Adequacy; The Alleged Improper Allocation Of The
Burden Of Persuasion On Availability Of Hospital Services, And Interpretation Of
"Reasonable Access" As It Relates To Access To Tertiary Care Hospital Services.

Petitioners claim that the Superintendent's Amended Decision includes three

errors oflaw.

(i) The Alleged Error of Law Involving "Member Ratios" and Network Capacity

First, they assert that the Superintendent improperly relied on "member ratios"

in determining the adequacy-specifically, the capacity-of Anthem's proposed Guided

Access HMO networks. Their argument can be summarized as follows:

Anthem maintained that so long as the ratio of projected members in the new
plans to the number of participating providers were below a certain threshold,
then the plan provides "reasonable access to medical services". Specifically,
Anthem contended that a ratio ofless than 2,000 members to 1 primary care
physician; and less than 6,000 members to 1 specialty physician is sufficient to
show reasonable access. R. 2611. The Superintendent, in his decision, accepted
the Anthem analysis, but modified the ratios to 500:1 for PCP's and 1500:1 for
specialty physicians. R. 2618-19. But, the Superintendent still relied upon the
concept of comparing the number of projected members to the number of
participating physicians. Id. This is an error oflaw .... It was established at the
hearing that none of the participating providers will be treating only members of
these plans. R. Binder 5, 59-64, 160.... The real issue is what capacity each
physician has to take on additional patients who would be shifted to the excluded
providers. Simply looking at the number of new members, and a ratio to the
number of participating providers, does not answer the question as to whether
there will be "reasonable access".

Petitioners' Brief at 25-26.

42
In his Amended Decision, the Superintendent addressed the Intervenor

Petitioners' argument directly: "The intervenors have noted that providers do not

exclusively serve Anthem patients, so their true capacity is understated. This is true,

but the argument cuts both ways, because for the same reasons, it is likely that if

Anthem takes on a significant number ofnew members, many of them will be seeing the

same providers with Anthem that they were already seeing before they enrolled in

Anthem." R. 2:2557 (Decision at S7); 2:2619 (Amended Decision at 38).

The Superintendent's determination whether Anthem's proposed Guided Access

HMO met the "reasonable access to medical services" standard, see 24-A M.R.S.

§ 4SOS(1); 02-031 C.M.R. ch. 850, § 7(A), involved a highly complex and somewhat

subjective evaluation ofmultiple variables, including:

• the number of persons likely to be enrolled in the Anthem Guided Access HMO
plans in various geographical areas

• the extent to which Anthem's proposed provider network would afford
reasonable access to prospective enrollees for various types ofmedical services

• the number of providers in the network; the nature of services offered by the
providers, and the providers' capacity to meet the demand for services associated
with the Anthem Guided Access HMO plans

As the Decision and Amended Decision illustrate, the "reasonable access"

calculus required the Superintendent to evaluate the proposed network across the

spectrum ofmedical services in each of the counties in which the Guided Access HMO

plans were to be offered.

As noted above, see Section II(D), supra at 21, the Anthem's supplemental filing

stated that the physicians and hospitals in Anthem's proposed network "will take all

new patients that are covered by the products that use the proposed network." R.

2:2466. Rather than relying solely on this evidence of capacity, the Superintendent

43
took several additional steps to address the uncertainties associated with projecting

enrollment and assessing provider capacity to handle projected enrollment.

He decided that Anthem's enrollment projections, which were based largely on

its own enrollment statistics and experience, did not sufficiently account for the

possibility of a massive influx of people who were previously uninsured and thus would

not have been counted in any enrollment statistics. R. 2:2554-56 (Decision at S4-S6);

2:2616-18 (Amended Decision at S5-S7). He quintupled Anthem's projection of

enrollment in the Guided Access HMO plans from about 40,000 to 200,000. R. 2:2556

(Decision at 36); 2:2618 (Amended Decision at S7).

That step necessitated a correlative adjustment in the patient:provider ratios

used to determine network adequacy. Anthem's filing assumed patient:provider ratios

of 2000:1 for PCPs, consistent with Bureau of Insurance Rule 850, and 6000:1 for

specialists. SeeR. SA:2658-59 (table of provider to member ratios). Rule 850 requires

"carriers that offer managed care plans utilizing primary care providers [to] maintain a

minimum ratio of one full-time equivalent primary care provider to 2000 enrollees."

See 02-0S 1 C.M.R. ch. 850, § 7(B)( 1). The 2000:1 PCP:patient ratio necessarily

incorporates generic assumptions about a PCP's capacity to handle patients. Rule 850

does not set specific ratios for specialists.

To help assure adequate network capacity for all potential enrollees in the

Anthem Guide Access HMO plans, the Superintendent reduced Anthem's proposed

ratios for PCPs and specialists by a factor of 4 for purposes of determining network

capacity, using ratios of 500:1 for PCPs and 1500:1 for specialists. R. 2:2556-57

(Decision at S6-S7); 2:2618-19 (Amended Decision at S7-S8). Because the 2000:1 ratio

for PCPs in Rule 850 necessarily incorporates generic capacity assumptions, reducing

44
that ratio by a factor of 4 could reasonably be expected to result in substantially more

network capacity per enrollee.

In addition, during the June 28 hearing, the Superintendent required Anthem to

supplement its initial filing with further information about its provider network. SeeR.

2:2468 (Order To Reconvene Hearing). Anthem's responsive supplemental filing

included data indicating which individual PCPs were accepting new patients. SeeR.

2:2464-67 (Anthem filing); SC:4169-4376 (Anthem Ex. 8). See also 2:2608-09 (Amended

Decision at 27-28). It also described commitments from various hospitals to serve

patients. R. 2:2466-67.

Although Anthem's provider:patient ratios were well within the 2000:1 and

6000:1 ratios it was proposing for PCPs and specialists, the Superintendent's application

of the lower 500:1 and 1500:1 ratios meant that providers needed to be added to

Anthem's network in certain specialties and in certain geographic areas. SeeR. 2621-30

(Amended Decision at 40-49). As a result, the Amended Decision imposed a variety of

conditions aimed at assuring capacity consistent with the ratios. See id. See also R.

2:2641-42 (Amended Decision at 60-61 ). The conditions of approval, the

Superintendent imposed on Anthem various monitoring and reporting requirements

intended to assure that capacity did not become an issue.

The Superintendent concluded: "With these conditions, I find that the 4:1

'worst-case' adjustment provides a sufficient safety margin that no additional

adjustment to the basic ratio analysis is necessary." R. 2:2621 (Amended Decision at

40). The Superintendent's utilization of significantly more conservative member ratios

in assessing network adequacy, coupled with evidence of capacity in the record and the

45
conditions of approval, are amply sufficient to support his conclusion that, in terms of

capacity, the proposed network afforded "reasonable access."

Although the Petitioners characterize the Superintendent's use and application

of"member ratios" as an error oflaw, the court sees it as an evidentiary determination,

in that the Superintendent was essentially deciding which data to use and how to apply

the data to some aspects of the network access issue. In effect, Petitioners assert that

the Superintendent should have required Anthem to obtain or estimate available

capacity information from every PCP and specialist. The Superintendent's implicit

decision that the data was not necessary in light of other evidence in the record and his

ability to require monitoring and reporting was not a legal judgment but a decision on

which evidence to apply and what weight to give it.

(ii) The Allocation of the Burden of Persuasion on Availability of Hospital
Services Issue

The Petitioners' second claimed error oflaw is that the Superintendent

improperly shifted the burden of persuasion off Anthem and onto the intervenor

hospitals with regard to availability of hospital services. Their argument is as follows:

In his decision, the Superintendent stated that the Intervenor hospitals (other
than CMMC) had failed to present " ... evidence that they provided particular
services that their in-network competitors did not." R. 2634. As a matter oflaw,
and as stated on the record of the proceeding, the burden of proof on the issue of
"reasonable access to medical services" was on Anthem, the applicant, not on the
Intervenors. In response to the Intervenors pointing out that Anthem had failed
to present any evidence as to the availability of hospital services in its
application or at the hearing, the Superintendent shifted the burden ofproofto
the Intervenors to demonstrate the lack of reasonable access. That was an error
oflaw.

Petitioners' Brief at 27.

The pertinent portion of the Superintendent's Amended Decision provides

clarifying context:

46
Anthem's proposed HMO network includes a tertiary care hospital, Maine
Medical Center, which provides the full panoply of hospital services. As for the
remaining community hospitals [in the proposed network] it is sufficient for
purposes of§ 4SOS( 1) analysis that such hospitals, in order to be licensed by the
State, are required by law to provide certain core medical services. Notably,
while four different community hospitals intervened in this proceeding, none
presented evidence that they provided particular services that their in-network
competitors did not.

R. 2:26S4 (Amended Decision at 5S) (citation and ellipses omitted).

With the benefit of context, it is clear that the Superintendent's Amended

Decision did not place the burden ofpersuasion on the availability of hospital services

on anyone but Anthem. The just-quoted passage recites the evidence that Anthem

presented toward meeting its burden to demonstrate availability of hospital services.

The passage plainly indicates that the Superintendent inferred, from the fact that the

community hospitals in Anthem's proposed network were all State-licensed, that they

offered the services required for licensure as community hospitals. The

Superintendent's comment about the intervenor community hospitals simply points out

that they did not attempt to rebut Anthem's showing of availability by showing that

they offer services beyond the those offered by the community hospitals in Anthem's

proposed network.

Petitioners have not shown any error oflaw in this regard.

(iii) Alleged Error of Law in Interpretation Of "Reasonable Access" As It
Relates To Access To Tertiary Care Hospital Services.

Petitioners' third assignment of error relates to the Superintendent's analysis of

"reasonable access" to Maine's three tertiary care hospitals. Their argument in

pertinent part is as follows:

The Superintendent found that there are only three tertiary care hospitals in
Maine: Eastern Maine Medical Center in Bangor; Maine Medical Center in
Portland; and Central Maine Medical Center in Lewiston. The Superintendent
found that the plan that excluded CMMC would provide "reasonable access" to

47
tertiary care hospital services to members residing in Androscoggin, Oxford and
Franklin counties, stating that" ... it is not unreasonable for a provider network
to include one tertiary care hospital to serve the southern portion of the state,
just as only one such hospital serves the larger northern portion of the state." To
find that the members residing in Androscoggin, Franklin and Oxford counties
who currently have access to a tertiary care medical center in Lewiston, should
be required to travel to Portland, because people who live in Aroostook County
have to travel to Bangor, is arbitrary, capricious, and inconsistent with a
statutory command that a plan provide "reasonable access."

Petitioners' Brief at 27.

The Superintendent's Amended Decision noted that Maine Medical Center and

CMMC are within 40 miles of each other, whereas the State's third tertiary hospital,

Eastern Maine Medical Center in Bangor, is more than 100 miles from either of the

other hospitals, and is "the closest tertiary hospital for a region of the state considerably

larger than the region that would be served by Maine Medical Center in the proposed

network." R. 2:26SS (Amended Decision at 52).

In rejecting the Intervenor Petitioners' argument, the Superintendent noted,

"The question is not how the proposed HMO network compares to a hypothetical

network including every hospital in Maine. It is whether the proposed HMO network

contains enough providers over a wide enough area to provide reasonable access to

health care services to members. If the access provided is reasonable, it is irrelevant

that the network could be bigger or better." Id.

The tertiary hospital access issue presented to the Superintendent, squarely

stated, was whether it was reasonable for participants in the Guided Access HMO plan

to obtain tertiary care at a hospital up to 40 miles farther away than another tertiary

care hospital. 10 In essence, the Petitioners' argument on this issue boils down to the

10 Logic dictates that, if Central Maine Medical Center is 40 miles from Maine Medical Center,
only people coming to Maine Medical Center from beyond CMMC have to travel a full 40 miles
farther. For everyone else, the difference in travel distance is less.

48
proposition that it is unreasonable to require enrollees to travel up to 40 miles farther

for tertiary care. In deciding what is reasonable, the Superintendent could legitimately

consider travel distance to tertiary care elsewhere in Maine, or even outside Maine.

Petitioners have not shown an error oflaw or arbitrary or capricious action on

the part of the Superintendent.

I. Alleged Lack Of Substantial Evidence To Support Findings Regarding Access To
Hospital Services And Specialty Physician Services, And Regarding The Capacity Of
Participating Hospitals And Participating PCPs

There is considerable overlap between Petitioners' claims of errors oflaw and

their claims regarding lack of substantial evidence.

(i) Evidence Regarding Access to Hospital Services

Petitioners assert that Anthem failed to present sufficient evidence regarding

access to hospital services, and therefore that the Superintendent's findings are not

based on substantial evidence in the record. They also repeat their objection to the

Superintendent's finding that Anthem's proposed network provided "reasonable access"

to tertiary care, this time in terms oflack of substantial evidence.

Access and availability are related concepts, but availability might well be

considered an element of access, along with capacity and geographic proximity. Because

Petitioners raise the capacity issue in a separate argument, this Decision on Appeal

frames the present issue in terms of availability of services and geographic proximity.

In terms of geographic proximity, Anthem presented evidence that its proposed

network included at least one hospital in every county in the Guided Access HMO plan

except for Sagadahoc County, which does not have any hospitals. R. SA:2659-60

(prefiled testimony of Colin McHugh). With regard to the availability of services at the

hospitals in Anthem's proposed HMO network, the Superintendent relied largely on

49
direct evidence of services offered at Maine Medical, and inferred from the fact of

licensure that the community hospitals in the proposed network offered the hospital

services required for such licensure. R. 2:2634 (Amended Decision at 5S). Likewise,

the Superintendent's analysis of the proposed network in terms of access to tertiary care

has already been addressed in detail above. See Section H.(iii), supra at 47. His ultimate

conclusion-that access to Maine Medical Center represented reasonable access to

tertiary care for the residents of the southern Maine counties covered by Guided Access

HMO plan-was well supported in the evidence.

The Superintendent's findings that Anthem's proposed network, assuming the

conditions of approval were met, afforded reasonable access to community hospitals and

tertiary care are supported by substantial evidence in the record.

Petitioners' argument regarding specialty medical services is not developed in

detail in their brief or reply brief However, it should be noted that the Superintendent's

use of reduced specialty patient:provider ratios, his detailed assessment of the evidence

by specialty and by county, and the combination of conditions he imposed in the

Amended Decision all are amply sufficient to support his conclusion as to specialists.

(ii) Evidence Regarding Capacity for Hospital Services, Specialist Services and
PCP Services

As they did with access issues, the Petitioners are essentially making the same

arguments about capacity issues in the substantial evidence context that they did in the

context of errors oflaw. The Petitioners' objection is that Anthem did not submit

actual numbers or estimates on the capacity ofthe hospital and individual providers in

Anthem's proposed network.

As noted above in the discussion of the Petitioners' "member ratios" argument,

the Superintendent applied "worst case" member ratios in deciding whether the number

50
ofproviders in Anthem's proposed network would afford "reasonable access." See

Section H(i), supra at 42. The Superintendent's determination that Anthem's proposed

network, with the conditions of approval, would provide sufficient capacity to support a

finding of "reasonable access" is supported by substantial evidence in the record.

J. Claim of Bias On The Part ofThe Superintendent

The Petitioners' claim ofbias is based both on statements made by the

Superintendent and on his conduct of the entire proceeding:

Petitioners assert that the Superintendent, the fact finder and decision maker in
this administrative proceeding, had pre-judged and pre-determined that
Anthem's application should be approved, and conducted the hearing in a
manner to assure that the Anthem application would be approved, such that the
right to an unbiased and impartial proceeding were denied to the intervening
and non-Intervenor Petitioners. This included the entire process from the
unreasonably contracted proceeding to reopening the record after briefs were
submitted to fill gaps in Anthem's case.

Petitioners' Brief at 11-12.

A party asserting bias on the part of an administrative agency decision maker

"must present evidence sufficient to overcome a presumption that the fact-finders, as

state administrators, acted in good faith." Friends ofMaine's Mountains v. Bd. ofEnvtl.

Prot., 201S ME 25, ~2S, 61 A.sd 689, citing Mallinckrodt LLC v. Littel~ 616 F.Supp.2d

128, 142 (D. Me. 2009) and Mutton Hill Estates, Inc. v. Town of Oakland, 468 A.2d 989,

991 (Me. 198S). Each of the two alleged areas ofbias-the statements and the conduct

of the proceeding-will be addressed separately.

(i) Superintendent's Statements

Initially through his counsel in another court case involving some of the

Petitioners, and later in his own words, the Superintendent indicated his view that it is

in the public interest for there to be more than one plan offered on the ACA exchange

for Maine. Since only two carriers had sought approval from the Maine Bureau of

51
Insurance, the Superintendent had to be referring to Anthem's plan. In fact, his Order

on the Intervening Petitioner's Notice of Claim ofbias, which the Superintendent

interpreted as a motion to disqualify, notes, "I believe it is in the public interest for

Anthem to offer some type of health plan on Maine's exchange." R 2:2434.

However, the Order in its entirety makes it clear that "some type of health plan"

did not necessarily mean the plan Anthem was proposing. As the Order on bias itself

pointed out, the expedited schedule (to which the Petitioners also objected) had as its

very purpose to enable the Superintendent to reject Anthem's proposed network and yet

enable "some type of health plan" to be offered on the exchange. Id. 2:2434-35.

The Petitioners' argument conflates an endorsement of there being two plans on

the exchange with an endorsement of the network Anthem was proposing. The issue

before the Superintendent in the proceeding was not whether there should be two plans

on the ACA exchange for Maine, but whether the "narrow network" proposed by

Anthem satisfied the statutory requirement of"reasonable access." To make that

distinction clear, the Superintendent's Order on bias also notes, "I have no intention of

approving any plan that does not provide the access to health care services required by

Maine law, even if it means fewer plans on Maine's exchange." R 2:2435.

In fact, the Superintendent did not approve Anthem's plan as it was originally

filed. Anthem was required to revise its filing, and even then the approval granted was

subject to multiple conditions.

Moreover, the Superintendent's view that it would be in the public interest for

there to be more than one plan on the ACA exchange for Maine is consistent with the

provisions of the Maine Insurance Code that reflect a legislative preference for active

competition among insurers. For example, section 4303 oftitle 24-A-the same

52
section that contains the network access standard-prohibits, with limited exceptions,

"most favored nation" clauses in insurer-provider contracts, because such provisions

usually operate to limit competition. See also 24-A M.R.S. § 3480 (superintendent

cannot approve merger plan among mutual insurers if it would "materially tend to

lessen competition in the insurance business in this State".

The Superintendent's view favoring choice for consumers is not a ground for

disqualifying him as a decision maker on whether a carrier's proposed provider network

should be approved.

(ii) Conduct of the Proceeding

The Petitioners' argument on the Superintendent's bias in the conduct of the

proceeding is based on much the same set of issues discussed in previous sections of this

Decision On Appeal:

[T]he Superintendent issued a series ofprocedural, discovery, and evidentiary
rulings, before, during, and after the hearing, which had the cumulative and
overwhelming effect offavoring Anthem and restricting the Intervenors' ability
to effectively participate in the proceeding.

Petitioners' Brief at 14.

Thus, most of the actions of the Superintendent that the Petitioners assert show

bias have been discussed previously herein, but a few merit revisitation in this context.

What the Petitioners refer to as the "unreasonably contracted proceeding" was

the result of the limited time between Anthem's filing and the federal deadline. What

this Decision On Appeal has termed the Superintendent's "middle path," see Section C,

supra at SO-meaning the approach that balanced the need for an expeditious decision

one way or the other against the public interest in the subject matter-could be

traversed only if the Superintendent, in his discretion, chose to convene a formal

proceeding, but set very tight dates and deadlines.

53
Another complaint of the Petitioners is that the Superintendent permitted

Anthem to supplement its application and prefiled testimony. Such actions were well

within the Superintendent's discretion. The implied premise in Petitioners' argument is

that the Superintendent was required to approve or reject Anthem's application as filed,

and could not allow Anthem to present foundational or rebuttal evidence in response to

the Intervenor Petitioners' and other intervenors' objections and presentations. That

premise is simply not the law.

The reopening ofthe record of which the Petitioners also complain was within

the Superintendent's discretion as well. The matters as to which the Superintendent

reopened the record-the HPHC report and Blue Choice network material-were not

critical to the Superintendent's decision and were neutral, rather than adverse, to the

Petitioners' position and therefore their inclusion in the record does not at all

demonstrate bias. See Section E., supra at 39.

The Petitioners' view that the Superintendent's bias extended to "the entire

process" can be explained by the basic conflict in goals. Whereas the Superintendent's

overall goal was to act on Anthem's application by the JulyS 1 federal deadline, the

record compels an inference that the Petitioners' overall goal was the exact opposite.

Thus, what the Petitioners characterize as "a series of procedural, discovery, and

evidentiary rulings, before, during, and after the hearing, which had the cumulative and

overwhelming effect offavoring Anthem" can instead be deemed rulings made to enable

the Superintendent to act by the deadline. The fact that the Superintendent conducted

the proceeding so as to be able to render a decision by the federal deadline does not

suffice to show bias.

54
IV. Conclusion

The Petitioners' grounds of appeal do not justify vacating or otherwise

modifying the Superintendent's Amended Decision approving Anthem's proposed

Guided Access HMO "narrow network". Accordingly, it is hereby ORDERED AND

ADJUDGED as follows:

1. The appeal ofPetitioners is denied.

2. The Amended Decision of the Superintendent dated August 2, 201.3 in the

Maine Bureau oflnsurance proceeding docketed as INS-1.3-801 is hereby affirmed.

S. The Order On Stay dated August 27, 201.3 is hereby affirmed.

4. Judgment shall be entered for Respondents.

Decision On Appeal by reference in the docket.

Dated April 11, 2014
/'J;~ _,/~A c
Pursuant to M.R. Civ. P. 79(a), the Clerk is hereby directed to incorporate this

A.M. Horton
Justice, Business & Consumer Court

55 Emeroo ~~Docket 'f • /I • /l..f
Copies~ \113 Mail_ Electronically _y"
Robert L. Kimball, Bridgton Hospital, Rumford Hospital, Maureen Harpell, N.P.,
Albert Aniel, M.D., David Salko, M.D., Brenda Weeks, Julie Rioux, Lisa Pease, Central
Maine Healthcare Corporation, Central Maine Medical Center, Dieter Kreckel, M.D.,
~Ian Verrill, M.D., William Lee, M.D., Daniel Trafford, and John Doe and Mary Roe,
unknown individuals,

v.

Superintendent of Insurance and Bureau of Insurance, Department of Professional
and Financial Regulation, State of Maine

BCD-AP-13-05

Robert L. Kimball, Bridgton Hospital, Rumford Hospital, Maureen Harpell, N.P.,
Albert Aniel, M.D., David Salko, M.D., Brenda Weeks, Julie Rioux, Lisa Pease,
Central Maine Healthcare Corporation, Central Maine Medical Center, Dieter
Kreckel, M.D., Alan Verrill, M.D., William Lee, M.D., Daniel Trafford, and John Doe
and Mary Roe, unknown individuals,
Petitioners

Counsel: Michael Poulin, Esq.
Skelton Taintor & Abbott
9 5 Main Street
Auburn, ME 04210

Superintendent of Insurance and Bureau of Insurance Department of Professional
and Financial Regulation
Respondents

Counsel: Jonathan R Bolton, AAG.
Office of the Attorney General
6 State House Station
Augusta, ME 04333

Anthem Health Plans of Maine
Participating Party

Counsel: Christopher T. Roach, Esq.
Roach Ruprecht Sanchez & Bischoff PC
66 Pearl Street, Suite 200
Portland, ME 04101

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10810575. Public record. Not legal advice.