Sec. 1. 24-A MRSA §2809-A, sub-§11-A is enacted to read:

11-A.__Continued group coverage; groups with fewer than 20 employees. Notwithstanding any other provision of this section, upon the termination of coverage for a member or employee covered under a group policy with 20 or fewer members or employees, the insurer shall allow the member or employee to elect, within the time period prescribed by paragraph B, to continue coverage under the group policy at no higher level than the level of benefits or coverage received by the member or employee immediately before termination of coverage and at the member's or employee's expense or, at the member's or employee's option, to convert to a policy of individual coverage without evidence of insurability in accordance with this section.

A.__For the purposes of this subsection, "member or employee" includes only those persons who have been a member or employee for at least 6 months.

B.__The member or employee has 31 days from the termination of coverage in which to elect continued coverage and make the initial payment under this subsection.

C.__An insurer is not required to continue coverage under a group policy if the member or employee meets the conditions set out in subsection 3, paragraph A.

D.__The payment amount for continued group coverage under this subsection may not exceed 102% of the group rate in effect for a group member, including an employer's contribution, if any.

E.__At the option of the member or employee, the continued group coverage may cover the member or employee, the member or employee and any dependents or only the dependents of the member or employee; provided that, in the latter 2 cases, the dependents have been covered for a period of at least 3 months under the group policy, unless the dependents were not eligible for coverage until after the beginning of the 3-month period.

F.__Except as provided in paragraph G, coverage provided under this subsection continues for 18 months.

G.__Coverage provided under this subsection may be terminated sooner than provided under paragraph F if:

(1) The member or employee fails to make timely payment of a required premium amount; or