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The TPA, Inc. and the Maine Superintendent of Insurance hereby enter into this Consent Agreement, pursuant to 5 M.R.S.A. § 9053(2), to resolve without an adjudicatory hearing issues arising out of the Petition for Disciplinary Action filed with the Superintendent on July 28, 1999.


  1. The Superintendent is the official charged with administering and enforcing the insurance laws of the State of Maine.
  2. The TPA, Inc. (the "TPA") is a Delaware corporation with a place of business in North Haven, Connecticut. The TPA is authorized to do business in the State of Maine as a foreign corporation pursuant to 13-A M.R.S.A. §§ 1201–1203, under the business name "Maine TPA."
  3. The TPA administered the employee health benefit plan for a client (the "Employer"). This plan provided dependent coverage to a Maine resident (the "Patient") whose parent, at all relevant times, was employed within the State of Maine by the Employer.
  4. The Patient received services between October 15, 1997 and March 26, 1998 from a Registered Nurse certified by the American Nurses’ Association as a psychiatric clinician (the "Provider").
  5. The TPA arranged for preauthorization of these health care services, in response to a telephone request. The preauthorization was actually conducted by United Healthcare Medical Management Services, a separate corporation which has not at any relevant time been under common ownership or control with the TPA. However, all communication between the Patient and the Plan was conducted through the TPA.
  6. When the claims were submitted, the TPA at first failed to process the claims because its staff had misfiled the paperwork, and then denied the claims on the ground that the Provider was a nurse and not a licensed clinical social worker.
  7. In response to inquiries, the TPA explained that the services would have been covered if the Provider had been a psychiatric specialist. The Provider was in fact a psychiatric specialist; according to the TPA, the claim denial was based on an erroneous determination by United Healthcare Medical Management Services.
  8. The TPA’s failure to take reasonable measures to verify the Patient’s eligibility for benefits violated Bureau of Insurance Rule 850, §§ 8(D) and 8(E).
  9. Even after verifying that the Patient was eligible for benefits, the TPA did not pay the claims, because the TPA’s contract with the Employer had terminated and the Employer had provided funds only for known liabilities as of December 31, 1998. The claims were forwarded to the Employer, who is outside the jurisdiction of the Superintendent. The lack of available funding was due to the TPA’s failure to handle the claim in an accurate and timely manner, in violation of Bureau of Insurance Rule 850, §§ 8(D) and 8(E).
  10. On May 18, 1999, Bureau of Insurance staff wrote to the TPA outlining the facts set forth above, attempting to resolve these issues without commencing a formal disciplinary action and advising that Maine law requires a response within 14 days to inquiries by the Superintendent arising out of consumer complaints. The TPA failed to respond in a timely manner, in violation of 24-A M.R.S.A. § 220(2).
  11. The TPA has subsequently made arrangements with the Employer to ensure the payment in full of the claims, which was completed in April of 2000.
  12. The TPA has also made arrangements to ensure the payment of two unrelated claims, as referenced in letters to the Bureau of Insurance dated June 9 and July 6, 2000. No admissions or findings of liability are made with respect to those two claims.
  13. Pursuant to 24-A M.R.S.A. §§ 1901(1) and 1902, unless a specific exemption applies, licensure by the Superintendent is required in order to act as or profess to be an administrator with respect to health coverage in the State of Maine. The services requiring licensure as a third-party administrator include the adjustment or settlement of health claims.
  14. Pursuant to 24-A M.R.S.A. §§ 1901(1)(N), an administrator is exempt from licensure in Maine to the extent that it is acting as a trustee, named fiduciary or plan official of an employee benefit plan governed by the federal Employee Retirement Income Security Act.
  15. The TPA was not a trustee, named fiduciary or plan official of the Employer’s plan, nor were its activities within the scope of any other exemption from licensure. The TPA has never been licensed by the Superintendent as a third-party administrator.
  16. In adjusting and settling health claims on behalf of the Employer’s plan, and in using the business name "The TPA," the TPA has held itself out and acted as a third-party administrator, in violation of 24-A M.R.S.A. § 1902.



  17. A formal hearing in this matter is waived and no appeal will be taken. This Consent Agreement is an enforceable final agency action of the Superintendent of Insurance within the meaning of the Maine Administrative Procedure Act.
  18. The TPA agrees to cease and desist from providing administrative services with respect to health coverage in the State of Maine on or after September 1, 2000, except for those services expressly exempt from licensure, unless the TPA holds a valid third-party administrator license. The Superintendent has the discretion to extend this deadline for good cause if a timely license application is pending.
  19. When the TPA is administering benefit plans requiring preauthorization or other utilization review, the TPA agrees to explain clearly to covered persons who is responsible for conducting the review and what the scope of the review is. If an appointment for health care services is certified as medically necessary without any determination has been made that the proposed services will actually be covered by the plan, the TPA will ensure that the consumer receives a clear explanation either as to whether or not the service will be covered, or as to what further steps need to be taken to obtain such a determination.
  20. The TPA agrees not to provide utilization review services with respect to health coverage in the State of Maine without a valid utilization review entity license issued pursuant to 24-A M.R.S.A. § 2771. This does not preclude the TPA, in its capacity as administrator, from arranging on either an ongoing or case-by-case basis for a properly licensed utilization review entity to provide utilization review services to a health plan administered by the TPA.
  21. Pursuant to 24-A M.R.S.A. §§ 12-A(1), the TPA agrees to the imposition of a civil penalty of $500 for each of the three violations recited in Paragraphs 8, 9, and 16, and a civil penalty of $200 for the violation recited in Paragraph 10. The TPA shall submit a check for $1700, payable to the Treasurer of the State of Maine, at the time of the execution of this Agreement.
  22. The TPA warrants that it has paid or arranged for payment in full of the unpaid balance of the claims described in the Stipulations, and of the two other claims referenced in Paragraph 12.
  23. In consideration of the TPA’s execution of and compliance with the terms of this Consent Agreement, the Superintendent agrees to forgo pursuing any disciplinary measures or other civil sanction for the actions described in the Stipulations, other than those agreed to in this Consent Agreement.
  24. It is understood by the parties to this Agreement that nothing herein shall affect any rights or interests that any person not a party to this Agreement may possess.
  25. The TPA understands and acknowledges that this Agreement will constitute a public record within the meaning of 1 M.R.S.A. § 402, and will be available for public inspection and copying as provided for by 1 M.R.S.A. § 408.
  26. The TPA has been advised of its right to consult with counsel, and has consulted with counsel before executing this Agreement.
  27. This Consent Agreement may only be modified by the written consent of the parties.



(printed name and title)

Personally appeared before me this day ______________________, and signed this Consent Agreement in my presence.

Notary Public



Judith Shaw Chamberlain, AAG




Alessandro A. Iuppa, Superintendent


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Last Updated: October 22, 2013