211 CMR 66.08 - Submission and Review of Rate Filings
Current through Register 1466, April 1, 2022
(1)
Definitions. For
rate filings submitted pursuant to 211 CMR 66.08(2), the following definitions
also shall apply:
(a)
Adjusted
Minimum Medical Loss Ratio. A specific Carrier's aggregated
medical loss ratio for all its merged market plans which was less than the
minimum medical loss ratio, but at least 1% greater than the Carrier's
equivalent loss ratio for the 12-months prior to the Carrier's present rate
filing.
(b)
Capital
Costs and Depreciation Expenses. All expenses associated with
depreciation (depreciation for EDP, equipment, software, and occupancy);
capital acquisitions (acquisition of capital assets, including lease payments
that were paid or incurred during the year); capital costs on behalf of a
hospital or clinic (expenditures for capital and lease payments incurred or
paid during the year on behalf of a hospital or clinic (or part of a
partnership, joint venture, integration or affiliation agreement); and other
capital (other costs that are directly associated with the incurring of capital
costs, such as legal or administrative costs, incurred or paid during the
year).
(c)
Charitable
Contributions Expenses. All contributions to tax-exempt
foundations and charities, not related to the company business
enterprises.
(d)
Claim
Completion Method. Any actuarial method used to quantify claims
which have been incurred but not yet paid.
(e)
Claims Operations
Expenses. All expenses associated with claims adjudication and
adjustment of claims, appeals, claims settlement, coordination of benefits
processing, maintenance of the claims system, printing of claims forms, claim
audit function, electronic data interchange expenses associated with claims
processing and fraud investigation.
(f)
Distribution
Expenses. All expenses associated with distribution and sale of
products, including commissions, producer, broker and benefit consultant fees,
other fees, commission processing and account reporting to brokers, agents and
producers.
(g)
Financial Administration Expenses. All expenses
associated with underwriting, auditing, actuarial, financial analysis,
investment-related expenses (not included elsewhere), treasury, and
reinsurance.
(h)
General Administration Expenses. All expenses
associated with payroll administration expenses and payroll taxes (salaries,
benefits and payroll taxes); real estate expenses (company building and other
taxes and expenses of owned real estate, excluding home office employee
expenses and rent (not allocated elsewhere) and insurance on real estate);
regulatory compliance and government relations (Federal and State reporting,
rate filing, state and federal audits, tax accounting, lobbying, licensing and
filing fees, preparation and filing of financial, utilization, statistical and
quality reports and administration of government programs); board, bureau or
association fees (Board of Directors, Bureau and association fees paid or
expensed during the calendar year); other administration (information
technology, senior management, outsourcing (not allocated elsewhere), insurance
except on real estate, equipment rental, travel (not allocated elsewhere),
certification and accreditation fees, legal fees and expenses before
administrative and legal bodies, and other general administrative expenses);
and negative adjustment for reimbursement from uninsured plans (all revenue
receipts from uninsured plans (including excess pharmaceutical rebates and
administrative fees net of expenses) and reimbursements from fiscal
intermediaries including administrative fees net of expenses from the
government).
(i)
Marketing and Sales Expenses. All expenses associated
with billing and Member enrollment (group and individual billing, Member
enrollment, premium collection and reconciliation functions); customer service
and Member relations (individual, group or provider support relating to
membership, enrollment, grievance resolution, specialized phone services and
equipment, consumer services and consumer information); product management,
marketing and sales (management and marketing of current products, including
product promotion and advertising, marketing materials, changes or additions to
current products, sales, pricing and enrollee education regarding coverage
prior to the sale); and product development: (product design and development
for new products not currently offered, major systems development associated
with the new products and integrated system network development).
(j)
Medical Administration
Expenses. All expenses associated with quality assurance and cost
containment (health and disease management and wellness initiatives (other than
for education), health care quality assurance, appeals, case management, fraud
detection and prevention, utilization review, practice protocol development,
peer review, outcomes analysis related to existing products, nurse triage,
medical management and other medical care evaluation activities); wellness and
health education (wellness and health promotion, disease prevention, Member
education and materials, provide education and outreach services); and medical
research (outcomes research, medical research programs and development of new
medical management programs not currently offered, major systems development
and integrated system network development).
(k)
Minimum Medical Loss
Ratio. The higher of the medical loss ratio in state or federal
law that applies to individual and small group health insurance premiums. The
Minimum Medical Loss Ratio for small group health insurance is 88%.
(l)
Miscellaneous Expenditures
Expenses. All other not classified expenses including all
collection and bank service charges, printing, office supplies, postage and
telephone (not allocated elsewhere).
(m)
Network Operations
Expenses. All expenses associated with provider contracting
negotiation and preparation, monitoring of provider compliance, field training
with providers, provider communication materials and bulletins, administration
of provider capitation and settlements, hospital and physician relations,
medical policy procedures, network access fees and credentialing.
(n)
Normalized per Member per
Month Claim Cost. Claim cost expressed per Member per month
adjusted to represent a Member whose rating factors equal one.
(o)
Taxes, Assessments and Fines
Paid to Federal, State or Local Governments (as Expenses). All
expenses associated with taxes (state premium taxes, state and local insurance
taxes, federal taxes, except taxes on capital gains, state income tax, state
sales tax and other sales taxes not included with the cost of goods purchased);
assessments, fees and other amounts paid to regulatory agencies (assessments,
fees or other amounts paid to state or local government and does not include
taxes or fines or penalties paid to any government agency); and fines and
penalties paid to regulatory agencies (penalties and fines paid to government
agencies).
(2)
Submission of Rate Filings.
(a) Every Carrier, as a condition of doing
business under M.G.L. c. 176J and
211
CMR 66.00, must submit quarterly rate filings for
their small Group Base Premium Rates and any changes to small group rating
factors electronically at least 90 days before their proposed effective dates,
and at least 180 days before their proposed effective dates for rates intended
to be effective as of January 1st. All Base Premium
Rates and rating factors are subject to disapproval if they do not meet the
requirements of M.G.L. c. 176J.
(b)
Any rates of reimbursement or rating factors included in small group rate
filing materials submitted for review by the Division shall be deemed
confidential and exempt from the definition of public records in M.G.L. c. 4,
§ 7, clause 26.
(3)
Content of Rate Filings. A Carrier's submission shall
be submitted in a format specified by the Commissioner and shall show the
company's development of the filed rates and contain at least the following
information:
(a) Summary rate information for
each product, including:
1. proposed rate
increase over rates in effect 12 months before proposed effective
date;
2. number of currently
enrolled groups/Members impacted by the proposed increase:
a. number of employer groups and covered
employees/dependents renewing by month; and
b. individual accounts and covered
individuals/dependents renewing by month;
3. average effective rate increase for all
persons covered under proposed rate changes; and
4. maximum increase for any group or
individual covered under the proposed rate change.
(b) Changes to cost-sharing and/or benefits
for each product relative to the 12 month period prior to the proposed
effective date of the filed rates for the following:
1. inpatient hospital care;
2. outpatient hospital care, with separate
experience for:
a.
radiological/laboratory/pathology costs; and
b. all other outpatient costs;
3. health care providers, with
separate experience for:
a. medical and
osteopathic physicians;
b. mental
health providers; and
c. all other
health care practitioners;
4. outpatient prescription drugs;
and
5. supplies.
For information submitted pursuant to 211 CMR 66.08(3)(c) through (j), a Carrier's submission shall provide details in aggregate.
(c) Number of Member
months of coverage reported for each of the latest available 12 months for
products issued or renewed according to M.G.L. c. 176J, as well as the number
of Member months projected to be impacted by the proposed rate
increase.
(d) Actual premium
revenue per Member per month reported for each of the latest available 12
months for products issued or renewed according to M.G.L. c. 176J, as well as
projected premium revenue per Member per month based on the proposed rates and
the projected Membership impacted by the rate increase. The premium revenue
also should be shown on a normalized per Member per month basis with a
description of normalization factors that are used and how they take into
account the average enrollee risk for the permitted risk characteristics. The
statement of actual premium revenue should explain any differences between what
is included in this filing and what normally is included in the Carrier's
reported financial statements.
(e)
Actual fee-for-service claims payment experience and utilization experience
reported for each of the latest available 12 months for products issued or
renewed according to M.G.L. c. 176J, on both an aggregate and normalized per
Member per month basis, that was used in the development of the Carrier's rate
filing and the projected claims payments and utilization experience for the
period impacted for the proposed rate increase, differentiating among:
1. inpatient hospital care;
2. outpatient hospital care, with separate
experience for:
a.
radiological/laboratory/pathology costs; and
b. all other outpatient costs;
3. health care providers, with
separate experience for:
a. medical and
osteopathic physicians;
b. mental
health providers; and
c. all other
health care practitioners.
4. outpatient prescription drugs;
and
5. supplies.
The analysis should explain any differences between what is included in this filing and what normally is included in the Carrier's financial statements. The Carrier also should submit projected Trends in fee-for-service utilization per 1,000 Members, costs per service and per Member per month costs for each of the noted service types that the Carrier is using to project historic claims forward to the period for which the rates will be effective. The Trend information should include the actuarial basis for all changes in fee for service Trends, including all relevant studies used to derive the factors. The analysis also should explain the completion method used to derive the incurred but not reported (IBNR) claims for the claim experience study.
(f) The
Carrier's historic capitation, as well as calculated normalized per Member per
month cost experience, relevant to products issued or renewed according to
M.G.L. c. 176J and used in the development of the rate making for the filing,
reported for each of the latest available 12 months of experience,
differentiating among:
1. inpatient hospital
care;
2. outpatient hospital care,
with separate experience for:
a.
radiological/laboratory/pathology costs; and
b. all other outpatient costs;
3. health care providers, with
separate experience for:
a. medical and
osteopathic physicians;
b. mental
health providers; and
c. all other
health care practitioners;
4. outpatient prescription drugs;
and
5. supplies.
The analysis should explain any differences between what is included in this filing and what normally is included in the Carrier's financial statements. The Carrier also should submit projected Trend factors that the Carrier is using to project historic claims forward to the period for which the rates will be effective. The Trend information should include the actuarial basis for all changes in capitation Trends, including all relevant studies or information that the Carrier believes will lead to changes in capitation costs.
(g) The Carrier's other non-fee-for-service
and non-capitation payments to providers, as well as calculated normalized per
Member per month cost experience, relevant to products issued or renewed
according to M.G.L. c. 176J and used in the development of the filing's rate
making, for at least the latest available 12 months of experience. The other
payments would include all bonus/incentives tied to provider performance and
other payments not tied to service or performance. The Carrier also should
submit the projected Trends factor in the other provider payments per Member
per month costs that the Carrier is using to project historic claims forward to
the period for which the rates will be effective. The Trend information should
include the actuarial basis for all changes in these payments, including all
relevant studies or information that the Carrier believes will lead to changes
in these other provider payment costs.
(h) The Carrier's administrative expenses and
per Member per month administrative expenses relevant to products issued or
renewed according to M.G.L. c. 176J and used in the development of the rate
making for the filing, for the two years prior to the submission of the rate
filing for each of the following categories:
1. expenses for financial
administration;
2. expenses for
marketing and sales;
3. expenses
for distribution;
4. expenses for
claims operations;
5. expenses for
medical administration, with specific detail on costs related to programs that
improve health care quality;
6.
expenses for network operations;
7.
expenses for charitable contributions;
8. expenses for general
administration;
9. expenses for
taxes, assessments and fines paid to federal, state or local
governments;
10. expenses for
capital costs and depreciation;
11.
expenses for miscellaneous expenditures described in detail; and
12. total administrative expenses
[subtotaling 211 CMR 66.08(3)(h)1. through 11.].
The Carrier also should submit projected increases in administrative expenses per Member per month costs that the Carrier is using to project administrative expenses forward to the period for which the rates will be effective. The Trend information should include an explanation for all significant changes in the company's administrative expenses due to one time costs, including where changes in administrative expenses may be caused by regulatory requirements or efforts to contain health care delivery costs, an explanation of the projected cost and cost per Member per month that can be attributed to each regulatory requirement or effort to contain health care delivery costs and the method that the Carrier is using to allocate any companywide expenses to the small group line of business.
(i) The Carrier's contribution to
surplus, relevant to products issued or renewed according to M.G.L. c. 176J,
both in the aggregate, on a normalized per Member per month basis and as a
percentage (%) of premium for the two years prior to the submission of the rate
filing. The Carrier also should identify the contribution to surplus included
in the rate filing on a per Member per month basis and as a percentage (%) of
premium and should provide a detailed explanation of the reasons that the
contribution to surplus has been filed at that level, as well as the
contribution to surplus levels that the Carrier is using in all other lines of
coverage. The Carrier should describe the method used to quantify the
contribution to surplus in the proposed rates.
(j) The three year historic medical loss
ratio for the rates, relevant to products issued or renewed according to M.G.L
c. 176J and the projected medical loss ratios for the one year period during
which rates will be in effect.
(k)
A detailed description of all cost containment programs the Carrier is
employing or will employ during the Rating Period to address health care
delivery costs and the realized past savings and projected savings from all
such programs.
(l) If the Carrier
intends to pay similarly situated providers within its provider networks
different rates of reimbursement, a detailed description of the bases for the
different rates including, but not limited to:
1. quality of care delivered;
2. mix of patients;
3. geographic location at which care is
provided; and
4. intensity of
services provided.
(m)
Interrogatories, including:
1. Detailed
explanations of methodological changes that have been employed by the Carrier
in development of rates, loads or factors since most recent filing, including:
a. pricing methodology;
b. administrative expense loads;
c. contribution to surplus loads;
d. rating factors;
e. cost containment and quality improvement
efforts;
f. provider contracting
initiatives;
g. methodology for
setting claim reserves;
h. size of
the claim reserve relative to the total incurred claims estimate for the most
recent year of experience; and
i.
reconciliation of claim payments in filing to claims system and recorded claim
payments in filed financial statements.
2. Detailed explanations of the development
of claims completion factors, including:
a.
explanation of the source of the filing's completion factor;
b. high level analysis of derivation of
factor;
c. explanation of whether
factor is consistent with reserve development for financial
reporting;
d. explanation of level
of conservatism used in developing factor;
e. demonstration for each calendar month in
the claim experience period of how any incurred but unreported claims were
estimated using the Carrier's completion factor(s); and
f. a comparison of estimated claim payments
provided in the most recent prior filing to current estimated claims costs for
the same time period.
3.
Detailed explanations of planned changes in methods of paying providers,
including:
a. Three year historical analysis
of the proportion of provider services reimbursed according to the following
methodologies:
i. discounted or undiscounted
charges;
ii. payment based on fee
schedules;
iii. incentive based fee
for service (payment is initially withheld and repaid to provider based on
provider performance);
iv. fee for
service payments with bonus/incentives tied to performance (additional payments
above and beyond the standard payment where the amount of the additional
payment is based on provider performance;
v. capitation payments (fixed payment per
Member per month for a specified set of services);
vi. risk sharing adjustment to provider
payments made in a fiscal year-end settlement whereby provider payments are
increased or decreased based on provider performance that is shared with the
health plan; and
vii. payments not
tied to provision of specific service or performance.
b. Explanation of projected distribution of
provider services to be reimbursed using these methodologies in the Rating
Period and an explanation of the impact on expected costs for covered Member
services.
c. Explanation of the
weighting of the criteria that the plan uses for evaluating performance based
provider payments, including:
i. patient
satisfaction;
ii. outcomes
measurement;
iii. participation or
adherence to processes to improve quality;
iv. measured achievement of quality
standards;
v. measured achievement
of utilization efficiency standards;
vi. measured achievement of cost containment
goals; and
vii. measured
implementation of technology necessary to improve efficiency.
d. Explanation of a Carrier's plan
to change the distribution of payment systems to providers in the future and
how this will impact future rate filings.
4. Benefit Level Rate Adjustment Factors,
including:
a. explanation of the process used
to ensure that the Benefit Level Rate Adjustment Factor reflects the actuarial
value of benefits in one plan versus another;
b. explanation of any effect that
Connector-offered plans may have on plans not offered through the Connector;
and
c. explanation of any reasons
that a filing may reflect different Benefit Level Trends for different products
and how this may be incorporated into the rate analysis.
5. Rating factors and Rating Adjustment
Factors, including:
a. illustration of how a
sample Member's factor is calculated for each permissible rate adjustment
factor (i.e., age, industry, participation rate, group size,
participation in smoking cessation programs, geographic region, group
purchasing cooperative, as appropriate); changes to every filed Rating
Adjustment Factor; and
b.
explanation of the methodology used to aggregate each Member's factors to
arrive at a total Rating Adjustment Factor for the individual or small group,
showing how the factors are applied to arrive at the final premium charged to
each dependent coverage tier in an individual contract or small group
policy.
6. Credibility
analyses, including:
a. explanation of how
actuary conducted a credibility analysis of available data; and
b. explanation of adjustments made due to
concerns over the credibility of available data and basis for said adjustments,
including an explanation of national or regional data that was used in place or
in combination with plan data when developing factors.
7. A discussion of the impact of
overestimates or underestimates of medical Trend in prior year rate filings on
the development of the current proposed rate.
8. A calculation of the Carrier's risk-based
capital level at the end of the most recent calendar quarter and the risk-based
capital level for the prior calendar year.
9. Overall rate impacts, including:
a. Illustration of rate changes for each
product, after application of the Rating Adjustment Factors and any changes in
the demographic make-up of the individual or group contract, using the
following ranges:
i. reduction of 10% or
more;
ii. reduction between 5.01%
and 9.99%;
iii. reduction of 5% or
less (including no change);
iv.
increase of less than 5%;
v.
increase of between 5.01% and 9.99%;
vi. increase of between 10.0% and 14.99%;
and
vii. increase of 15% or
more.
b. Explanation of
the reasons, distinguishing by base rate changes and the application of Rating
Adjustment Factors, for which rates of any groups increase by more than
15%.
(o) Any
other information requested by the commissioner, including, but not limited to,
any information requested by the commissioner on behalf of the National
Association of Insurance Commissioners.
(p) Each rate filing shall be accompanied by
a supporting actuarial memorandum prepared and certified by a qualified Member
of the American Academy of Actuaries and an Actuarial Opinion.
(4)
Review of
Filing.
(a) A Carrier's filing
will not be considered to be complete until all materials required by M.G.L. c.
176J and
211
CMR 66.00 have been received by the
Division.
(b) A Carrier shall
respond to any request for additional information by the Division within five
days of the date of the Division's request. Failure to respond to the
Division's request within five business days may result in a delay of the
Division's review of the filing and a delay in the proposed effective date of
the filed small group rates.
(c)
Every Carrier shall include with any submission under 211 CMR 66.08(3) a cover
letter summarizing the content in 211 CMR 66.08(3)(h)12., (i) and (j), and a
statement indicating whether the Carrier consents to a designation of
presumptive disapproval pursuant to M.G.L. c. 176J, § 6(d). Group Base
Premium Rates will be presumptively disapproved as excessive if the rate filing
does not meet the following standards:
1.
Administrative Expense Standards. Group Base Premium
Rates will be presumptively disapproved if the filing's projected
administrative expense loading component, not including taxes and assessments,
increases by more than the most recent calendar year's increase in the New
England medical CPI.
a. The projected
administrative expense loading component is the per Member per month
administrative expense described in 211 CMR 66.08(3)(h)12. plus the producer
commission expense. The most recent calendar year's increase in the New England
medical CPI shall be calculated by dividing the index value for the November
period preceding the date of the filing by the same index value from the
November period one year earlier. For the purpose of 211 CMR 66.08(4)(c)1.b.,
the New England medical CPI shall reflect the Consumer Price Indexes for All
Urban Consumers (CPI-U), U.S. city averages and selected areas, for the
Boston-Brockton-Nashua area.
2.
Contribution-to-surplus
Standards. Group Base Premium Rates will be presumptively
disapproved as excessive if the rate filing's contribution-to-surplus loading
component exceeds 1.9% of the total filed Group Base Premium Rate.
a. The contribution-to-surplus loading
component shall represent the per Member per month contribution-to-surplus
amount submitted in 211 CMR 66.08(3)(i).
b. If a Carrier's Risk Based Capital Ratio,
calculated according to the provisions of
211 CMR 25.00:
Risk-based Capital (RBC) for Health Organizations, falls below
300% for the four most recent consecutive quarters, the Group Base Premium
Rates will be presumptively disapproved as excessive if the filing's
contribution-to-surplus loading component exceeds 2.5% of premium.
3.
Medical Loss Ratio
Standards. Group Base Premium Rates will be presumptively
disapproved as excessive if the rate filing's projected aggregate medical loss
ratio for all plans offered in the individual-small employer market is less
than the Minimum Medical Loss Ratio.
a. The
aggregate medical loss ratio shall be reported as submitted in 211 CMR
66.08(3)(k).
b. When a Carrier's
individual/small Group Base Premium Rates for a Rating Period would have been
presumptively disapproved for failure only to meet the aggregate Minimum
Medical Loss Ratio, the group base premium will not be presumptively
disapproved if the aggregate loss ratio for all of the Carrier's
individual/small group plans was at least 1% higher than the Carrier's
equivalent medical loss ratio in the 12-months prior to the present filing. In
this case, the filed medical loss ratio will be considered the Adjusted Minimum
Medical Loss Ratio.
(5)
Disapprovals.
(a) Rate filings may be presumptively
disapproved with the consent of the Carrier or presumptively disapproved by the
Commissioner as described in 211 CMR 66.08(4)(c). Rate filings also shall be
disapproved by the Commissioner if the benefits provided therein are
unreasonable in relation to the rate charged, or if the rates are excessive,
inadequate or unfairly discriminatory or do not otherwise comply with the
requirements of M.G.L. c. 176J or
211
CMR 66.00. Changes to filed small group Rating
Adjustment Factors shall be disapproved by the Commissioner if found to be
discriminatory or not actuarially sound. Notwithstanding the foregoing, where
applicable, rate filings made under
211
CMR 66.00 also are subject to the provisions of
regulations specifying the procedures for rate hearings on such rate
filings.
(b) If a Carrier's filing
is presumptively disapproved, it shall be subject to a hearing to be scheduled
to commence within 45 days of the Carrier's submission of a complete filing.
The Commissioner retains the right to presumptively disapprove or disapprove
the subject filing for reasons other than those identified by the Carrier and
to provide notice of such presumptive disapproval or disapproval to the
Carrier.
(c) If a Carrier's filing
is presumptively disapproved by the Commissioner, it shall be considered
disapproved. A Carrier shall communicate to all employers and individuals
covered under a small group product that the proposed increase has been
presumptively disapproved and is subject to a hearing at the Division
(d) If the Commissioner disapproves a
Carrier's proposed base rate(s) or proposed changes to rating factors or rating
adjustment factor(s), he shall notify the Carrier in writing in accordance with
the timing described below and he shall state the reason(s) for the
disapproval, including whether the disapproval is presumptive.
1. If a Carrier's submission is deemed
complete and filed at least 120 days in advance of its proposed effective date,
the Commissioner shall notify the Carrier of any disapproval no later than 75
days prior to the effective date of the Carrier's filing.
2. If a Carrier's submission is deemed
complete and filed between 119 and 105 days in advance of its proposed
effective date, the Commissioner shall notify the Carrier of any disapproval no
later than 60 days prior to the effective date of the Carrier's
filing.
3. If a Carrier's
submission is deemed complete and filed between 104 and 90 days in advance of
its proposed effective date, the commissioner shall notify the Carrier of any
disapproval no later than 45 days prior to the effective date of the Carrier's
filing.
(e) In the event
of a disapproval under 211 CMR 66.08(5)(a) through (d), a Carrier shall comply
with the following procedures:
1. the Carrier
shall not quote, issue, make effective, deliver or renew Health Benefit Plans
in the Commonwealth using disapproved base rates. The Carrier shall quote,
issue, make effective, deliver or renew all Health Benefit Plans using base
rates as in effect 12 months prior to the proposed effective date of the
disapproved base rates. 211 CMR 66.08(5)(a) through (d) also applies to new
Health Benefit Plans whose base rates are disapproved. In calculating premiums,
the Carrier may apply any applicable, but not previously disapproved, Rating
Adjustment Factors;
2. the Carrier
shall recalculate applicable rates for all affected Health Benefit Plans and
shall issue rate quotes and make all Health Benefit Plans available through all
distribution channels, including Intermediaries, the Connector, licensed
insurance producers and the Carrier's website, but in no event more than ten
calendar days after the Carrier's receipt of the disapproval;
3. the Carrier shall notify all affected
policyholders of the disapproval within ten calendar days of the Carrier's
receipt of the disapproval;
4. the
Carrier shall promptly provide notice of all material changes to the
evidence(s) of coverage to all affected individuals and groups in accordance
with M.G.L. c. 176O, § 6(a) and
211 CMR
52.12(6): General
Notice of Material Changes;
5. within ten days of receipt of the
disapproval, the Carrier may request a hearing on the disapproval. The hearing
shall be adjudicatory and de novo;
6. presumptive disapproval hearings shall
commence within 45 days of the submission of a complete rate filing and other
disapproval hearings shall commence within 15 days of the Commissioner's
receipt of the Carrier's request for a rate hearing. In either case, notice of
the public hearing will be given to, or advertised in, newspapers in Boston,
Brockton, Fall River, Pittsfield, Springfield, Worcester, New Bedford, and
Lowell. The Commissioner shall issue a written decision within 30 days after
the conclusion of the hearing.
7.
the Commissioner shall issue an order as to the requested rates within 30 days
following the conclusion of the public hearing. The Commissioner may base a
final disapproval of the filing on reason(s) other than those identified in the
initial disapproval. If the filing is disapproved and a revised filing
conforming to the terms of the decision is resubmitted in accordance with
applicable regulations specifying the procedures for rate hearings on such rate
filings, it shall be placed on file, thereby making those rates available for
use.
(6)
Appeals. Any order, decree, or judgment of the Supreme
Judicial Court modifying, amending, annulling, or reversing a decision of the
Commissioner disapproving a rate filing, and any further decision of the
Commissioner pursuant to such an order, decree, or judgment that affects the
overall rate not disapproved shall be effective as ordered.
(7)
Maintaining
Records. Every Carrier must maintain at its principal place of
business a complete and detailed description of its rating practices including
information and documentation which demonstrates that its rating methods and
practices are based upon commonly accepted actuarial assumptions, are in
accordance with sound actuarial principles, and comply with the provisions of
211
CMR 66.00. This information must be made available to
the Commissioner upon request, but will remain confidential.
(8)
Methodology for Calculating
and Reporting Refund, Rebate or Credit Calculations.
(a) Unless otherwise determined by the
Commissioner, for the purposes of M.G.L. c. 176J, § 6, Carriers are to
calculate and submit a rebate calculation form as designated by the
Commissioner each calendar year by July 31st for the
previous calendar year in accordance with the current NAIC methodology for
calculating rebates. When completing the form for Massachusetts, Carriers are
to use the Minimum Medical Loss Ratio, or if applicable, the Adjusted Minimum
Medical Loss Ratio, that applies in the year for which the calculation was
completed.
(b) If the calculation
illustrates that a refund or rebate is warranted, the Carrier shall submit a
detailed plan, for the Commissioner's approval, that will provide a detailed
description of the manner in which the Carrier will refund the excess premium
to those individuals or small employers who were covered during the prior
calendar year or an explanation of the reasons that the Carrier proposes not to
make a refund or rebate. The amount of the rebate will be based on the
individual's or small employer's relative share of the premiums that were paid
to the Carrier during the calendar year.
(c) A Carrier shall communicate within 30
days to all individuals and small employers that were covered under plans
during the relevant 12-month calendar year that such individuals and small
employers qualify for a refund which may take the form of either a refund on
the premium for the applicable 12-month period, or if the individual or small
employer are still covered by the Carrier, a credit on the premium for the
subsequent 12-month period.
(d) The
basis for all refunds issued shall equal the amount of a Carrier's earned
premium that exceeds that amount necessary to achieve the Minimum Medical Loss
Ratio, or if applicable, the Adjusted Minimum Medical Loss Ratio, calculated
using data reported by the commissioner. The Commissioner may authorize a
waiver or adjustment of the refund requirement if the Commissioner determines
that issuing such refunds would result in Financial Impairment for the Carrier
or if the commissioner determines that such refunds are de
minimus. The aggregate of any de minimus amount not
refunded shall be used to reduce overall premiums.
(e) Refunds shall be paid annually by August
31st of the year following the calendar year of the
rebate calculation.
(f) Carriers
who issue refunds shall keep records of all refunds made to affected
individuals and small groups for inspection by the Division.
(g) No individual or small employer may
assign his or her or its rights to such premium adjustments to another person
or entity.
(h) If a Carrier fails
to make refunds, rebates or premium adjustments acceptable to the commissioner,
the commissioner may order premium adjustments, refunds or premium credits he
deems necessary.
(9)
Information. Every Carrier must maintain at its
principal place of business a complete and detailed description of its rating
practices including information and documentation which demonstrates that its
rating methods and practices are based upon commonly accepted actuarial
assumptions, are in accordance with sound actuarial principles, and comply with
the provisions of
211
CMR 66.00. This information must be made available to
the Commissioner upon request, but will remain confidential.
Notes
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