| 1. The Chancellor of the University of Maine System, referred |
| to in this section as "the chancellor," and any insurance company |
| or 3rd-party administrator acting at the direction of the State, |
| referred to in this section as "the carrier," insuring or |
| administering the University of Maine System health plan for |
| employees and retirees, referred to in this section as "the |
| plan," shall negotiate agreements with hospitals participating in |
| the carrier's provider network to reduce the expense incurred by |
| the plan in state fiscal year 2003-04 by the amount of $2,250,000 |
| and in state fiscal year 2004-05 by the amount of $2,250,000. It |
| is not the intent of the Legislature to require negotiations to |
| reduce such expenses beyond state fiscal year 2005. In |
| undertaking such negotiations, the carrier is deemed at all times |
| to be the agent of the State of Maine and the University of Maine |
| System. The chancellor and the carrier, acting at the direction |
| of the State, may offer or demand such terms and conditions as |
| the chancellor considers to be in the best interest of the |
| university to reduce the expense of the plan, including, but not |
| limited to, offering or demanding reductions in standard hospital |
| reimbursement rates, rebates and refunds and uniform terms |
| relating to such reductions, rebates or refunds. The chancellor |
| may not affect or seek to affect amounts paid to hospitals |
| relating to any other customer of the carrier. The hospital |
| discount rate resulting from this specific arrangement is not |
| intended to affect the underlying premium rates for any purpose. |
| This pooling of funds by the State is not intended to affect plan |
| cost recoveries, plan cost |
| structures or the university's ability to negotiate with carriers |
| regarding the plan. |
