> Dirigo Health Filing

STATE OF MAINE
DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION
BUREAU OF INSURANCE

By filing made on August 15, 2008 in the above-captioned proceeding, the Maine Automobile Dealers Association Insurance Trust (MADA) moved for my recusal from any further participation in this matter. In support of its motion, the MADA alleges that my position as a former member of the Board of Directors of Consumers for Affordable Health Care, Inc. (CAHC), an intervenor party in this proceeding, demonstrates bias by me in favor of CAHC and thus the Dirigo Health Agency and the Dirigo Board (whom CAHC has supported in prior years’ aggregate measurable cost savings proceedings before the Bureau of Insurance). The MADA further alleges that other facts suggest that I am predisposed in favor of the Dirigo Board’s year four aggregate measurable cost savings determination. The MADA cites to an August 2006 briefing by me to Governor Baldacci, and a January 2008 news article quoting a third person.

All of the matters or materials relied on by the MADA predate my oath of office as the Superintendent of Insurance on March 7, 2008. Regarding the MADA’s asserted basis for disqualification arising from my past membership on the CAHC Board of Directors, a further point of material clarification is warranted. While on the faculty of Georgetown University, I served on various boards of directors. As is demonstrated on Exhibit C to the MADA’s motion, this included membership on the Board of Consumers for Affordable Health Care Foundation (the “Foundation”), a separate non-profit corporate entity from CAHC.¹ CAHC has its own Board of Directors, of which I am not and have never been a member.

I resigned from my Foundation Board position effective January 24, 2008, at the time of my nomination by Governor Baldacci to serve as Superintendent of Insurance. The year four proceeding before the Dirigo Health Agency commenced after my resignation from the Foundation Board, upon a Notice of Pending Proceeding and Hearing issued by that agency on March 7, 2008. In the proceeding before the Dirigo Board, as explained in the Dirigo Health Agency’s August 11, 2008 Decision, CAHC intervened and limited its involvement at hearing “to reviewing information and participation on an informational basis”; CAHC “participated in the examination of witnesses but did not present any witnesses or offer any documentary evidence.”

Regarding my August 2006 briefing to Governor Baldacci and the 2008 news article, neither pertains to the facts at issue in this proceeding. Thus, the briefing to the Governor, entitled “Dirigo, state and federal proposals and their impact on Dirigo, and future expansion efforts,” does not constitute prejudgment by me of any matters presented in this proceeding. The January 2008 news article quotes Joe Ditré, CAHC’s Executive Director, as recalling that I “was a supporter of Baldacci’s Dirigo health reforms and of the DirigoChoice insurance program in particular.” First, this is not a statement I made; second, this quote does not support a finding of prejudgment by me of the issues in this proceeding.

I nonetheless acknowledge that I have spoken publicly with positive remarks regarding the Dirigo program. The Dirigo program itself, however, is not the issue for adjudication in this proceeding. The statutory standard governing this proceeding is for the Superintendent to “issue an order approving, in whole or in part, or disapproving the [Dirigo] filing.” 24-A M.R.S.A. § 6913(1)(C). The Superintendent is required to “approve the filing upon a determination that the aggregate measurable cost savings filed by the [Dirigo] board are reasonably supported by the evidence in the record.” Id.

It is the Dirigo Board’s cost savings determinations contained in its August 12, 2008 filing with the Superintendent that are being adjudged in this proceeding. I have made no prejudgment on those determinations or the facts related thereto. In fact, I was repeatedly questioned at the time of my confirmation hearing about how I might rule in a cost savings determination proceeding, and consistently responded to IFS Committee members, other legislators, and stakeholders that any ruling I am called upon to make will be based on the evidence in the record. In their motion, MADA did not include these past statements relating to the cost savings.

In summary, the MADA has presented no persuasive evidence that I have prejudged any issues in this proceeding. The MADA simply argues that my past representation on the Foundation’s Board (a separate Board from CAHC); a newspaper article quoting a third person, not me; and a 2006 briefing I gave the Governor in my capacity as a researcher on the faculty at Georgetown University are per se evidence of bias. I find that the matters asserted and materials submitted by the MADA in support of its motion include no evidence of bias or prejudgment on my part regarding the matters presented in this proceeding.

The MADA cites to 5 M.R.S.A. § 9063(1) as obligating my recusal. That provision states in its entirety as follows:

Hearings shall be conducted in an impartial manner. 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.

The Maine Supreme Judicial Court, following the guidelines established by federal decisions, has held that disqualification of an agency officer is necessary “only after a showing of prejudgment on the specific facts subsequently presented to the agency.” New England Tel. & Tel. Co. v. Public Utilities Com., 448 A.2d 272, 280 (Me. 1982) (citing cases omitted). The test for disqualification is whether a disinterested observer may conclude that the agency has in some measure adjudged the facts in advance of hearing them. Cinderella Career & Finishing Schools, Inc. v. FTC, 425 F.2d 583 (D.C. Cir. 1970). It has been further explained that a “preconceived position on law, policy or legislative facts is not a ground for disqualification.” New England Tel.,448 A.2d at 280, citing FTC v. Cement Institute, 333 U.S. 683, 700-703 (1948). Thus, as cited in Northeast Occupational Exchange, Inc. v. Bureau of Rehabilitation, 473 A.2d 406, 410 (Me. 1984), the fact that an administrator took a public position in relation to a policy surrounding the dispute presented is not grounds for disqualification. See Hortonville Joint School District No. 1 v. Hortonville Education Association, 426 U.S. 482, 493 (1976). More recently, it has been held that “[a]n administrative process may be infirm if it creates an intolerable risk of bias or unfair advantage.” Zegel v. Bd. of Soc. Worker Licensure, 2004 ME 31, ¶ 16, 843 A.2d 18, 22 (citing case omitted).

I hereby determine on the record that I am not biased and have no personal or financial interest, direct or indirect, regarding the matters presented for adjudication before me in this proceeding. I hereby further determine on the record that I can and will conduct this proceeding and the public hearing in this matter in an impartial manner. I conclude that the administrative process in this proceeding does not and will not create an intolerable risk of bias or unfair advantage.

By reason of the foregoing, the Superintendent declines to disqualify herself from adjudicating the matters presented in this proceeding and thereby DENIES the Motion of the Maine Automobile Dealers Association Insurance Trust to Recuse Superintendent Kofman.

¹ I acknowledge, as is explained by the organizations themselves, that CAHC and the Foundation are sister organizations. The MADA’s misunderstanding regarding their separate corporate existence, therefore, is not unfounded. As explained by the organizations’ internet pages, CAHC is a membership organization while the Foundation is not. See http://www.mainecahc.org. As these organizations describe themselves, CAHC is a consumer coalition existing to ensure that health care consumers have a strong voice in health care matters. CAHC is committed to organizing and educating people in the State of Maine to enable them to actively participate in decision-making at all levels and in all forums, through advocacy and lobbying for systemic reforms. Conversely, the Foundation provides non-partisan research, training, and education to the public, government officials, business, and organizations. The Foundation also offers services directly to health care consumers, including assistance with state programs and private health insurance companies. The Foundation’s Board members at the time of my service also included former Maine Superintendent of Insurance Brian Atchinson, Executive Director of the Insurance Marketplace Standards Association, and Professor Elizabeth Kilbreth of the University of Southern Maine Muskie School of Public Service.

PER ORDER OF THE SUPERINTENDENT OF INSURANCE

> Dirigo Health Filing