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Maine Insurance Superintendent Issues Cease and Desist Order Against Senior Health Insurance Company of Pennsylvania (SHIP)

MAINE, February 10 - Back to current news.

February 10, 2022 Professional & Financial Regulation - Insurance

On Tuesday, February 8, 2022, Maine Insurance Superintendent Eric Cioppa issued a Cease and Desist Order against Senior Health Insurance Company of Pennsylvania (SHIP). Superintendent Cioppa also scheduled a virtual public hearing for Friday, February 18 at 9 a.m., to consider whether the Order should remain in place.

Approximately 350 Mainers, with an average age of 86 years, are SHIP long-term care insurance policyholders.

The Order states: "Effective immediately, SHIP and its principals, employees, and agents shall halt disseminating, implementing, or enforcing in this State the 'Coverage Election Package' or otherwise interfering with the rights of SHIP's Maine policyholders...."

The Order was issued as a result of SHIP's actions, following the placement of the company into rehabilitation by Pennsylvania's Commissioner of Insurance in January 2020. The Rehabilitation Plan was approved by the Pennsylvania Commonwealth Court in August 2021 and subsequently appealed by the State of Maine, the Commonwealth of Massachusetts, and the State of Washington. The appeal is pending before the Pennsylvania Supreme Court. A request to stay the Rehabilitation Plan while the appeal is considered was submitted by the three intervening jurisdictions but was denied.

A total of 30 jurisdictions have stated their opposition to the Rehabilitation Plan as being unfair to policyholders; the three intervening jurisdictions that have appealed the order approving the Plan and 27 jurisdictions that signed the amicus brief in support of the appeal.

SHIP's appointed Rehabilitator began taking action under the Plan in late January of this year by sending a "Coverage Election Package" to Maine policyholders, requiring them to select modified benefits or premium increases by March 15, 2022, with an effective date as early as April 1, 2022.

The Order calls for SHIP to immediately cease its actions related to the sending of the Coverage Election Package to Maine policyholders. The Order also requires SHIP to cease activities related to proposed rate increases or benefit changes without following Maine laws requiring prior notice to consumers and prior review and approval of the Superintendent of Insurance.

The hearing will determine whether the Cease and Desist Order should remain in place, whether any sanctions should be imposed for violations that are proven, and whether other remedial issues should be taken. If all parties to the action agree, it is also possible that the hearing may be rescheduled.

Those who wish to attend the hearing need to preregister through a link on the Bureaus website. SHIPs Maine policyholders may contact the Bureau's Consumer Health Care Division for more information by calling 800-300-5000 (TTY 711) or emailing Insurance.PFR@maine.gov.

Consumers with questions about insurance matters can obtain information and assistance from the Maine Bureau of Insurance by visiting www.maine.gov/insurance, calling 800-300-5000 (TTY 711), or e-mailing Insurance.PFR@maine.gov.