42 CFR 403.253 - Calculation of benefits.

§ 403.253 Calculation of benefits.

(a)General provisions.

(1) Except as provided for in paragraph (a)(2) of this section, calculate the amount of “benefits” by -

(i) Adding the present values on the initial calculation date of -

(A) Expected incurred benefits in the loss ratio calculation period, to -

(B) The total policy reserve at the last day of the loss ratio calculation period: and

(ii) Subtracting the total policy reserve on the initial calculation date from the sum of these values.

(2) To calculate the amount of “benefits” in the case of community or pool rated individual or group policies rerated on an annual basis, calculate the expected incurred benefits in the loss ratio calculation period.

(b)Calculation of total policy reserve -

(1)Option for calculation. The insuring organization must calculate “total policy reserve” according to the provisions of paragraph (b) (2) or (3) of this section.

(2)Total policy reserve: Federal provisions.

(i) “Total policy reserve” means the sum of -

(A) Additional reserve; and

(B) The reserve for future contingent benefits.

(ii)Additional reserve means the amount calculated on a net level reserve basis, using appropriate values to account for lapse, mortality, morbidity, and interest, that on the valuation date represents -

(A) The present value of expected incurred benefits over the loss ratio calculation period; less -

(B) The present value of expected net premiums over the loss ratio calculation period.

(iii)Net premium means the level portion of the gross premium used in calculating the additional reserve. On the day the policy is issued, the present value of the series of those portions equals the present value of the expected incurred claims over the period that the gross premiums are computed to provide coverage.

(iv)Reserve for future contingent benefits means the amounts, not elsewhere included, that provide for the extension of benefits after insurance coverage terminates. These benefits -

(A) Are predicated on a health condition existing on the date coverage ends;

(B) Accrue after the date coverage ends; and

(C) Are payable after the valuation date.

(3)Total policy reserve: State provisions. “Total policy reserve” means the total policy reserve calculated according to appropriate State law or regulation.

This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.

This list is taken from the Parallel Table of Authorities and Rules provided by GPO [Government Printing Office].

It is not guaranteed to be accurate or up-to-date, though we do refresh the database weekly. More limitations on accuracy are described at the GPO site.

United States Code
Public Laws

Title 42 published on 19-Apr-2017 03:51

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 42 CFR Part 403 after this date.

  • 2016-09-16; vol. 81 # 180 - Friday, September 16, 2016
    1. 81 FR 63860 - Medicare and Medicaid Programs; Emergency Preparedness Requirements for Medicare and Medicaid Participating Providers and Suppliers
      GPO FDSys XML | Text
      DEPARTMENT OF HEALTH AND HUMAN SERVICES, Centers for Medicare & Medicaid Services
      Final rule.
      Effective date: These regulations are effective on November 15, 2016. Incorporation by reference: The incorporation by reference of certain publications listed in the rule is approved by the Director of the Federal Register November 15, 2016. Implementation date: These regulations must be implemented by November 15, 2017.
      42 CFR Parts 403, 416, 418, 441, 460, 482, 483, 484, 485, 486, 491, and 494
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