10181. For purposes of this article, the following definitions
shall apply:
(a) "Large group health insurance policy" means a group health
insurance policy other than a policy issued to a small employer, as
defined in Section 10700.
(b) "Small group health insurance policy" means a group health
insurance policy issued to a small employer, as defined in Section
10700.
(c) "PPACA" means Section 2794 of the federal Public Health
Service Act (42 U.S.C. Sec. 300gg-14), as amended by the federal
Patient Protection and Affordable Care Act (P. L. 111-48), and any
subsequent rules, regulations, or guidance issued pursuant to that
law.
(d) "Unreasonable rate increase" has the same meaning as that term
is defined in PPACA.
10181.2. This article shall apply to health insurance policies
offered in the individual or group market in California. However,
this article shall not apply to a specialized health insurance
policy; a Medicare supplement policy subject to Article 6 (commencing
with Section 10192.05); a health insurance policy offered in the
Medi-Cal program (Chapter 7 (commencing with Section 14000) of Part 3
of Division 9 of the Welfare and Institutions Code); a health
insurance policy offered in the Healthy Families Program (Part 6.2
(commencing with Section 12693)), the Access for Infants and Mothers
Program (Part 6.3 (commencing with Section 12695)), the California
Major Risk Medical Insurance Program (Part 6.5 (commencing with
Section 12700)), or the Federal Temporary High Risk Pool (Part 6.6
(commencing with Section 12739.5)); a health insurance conversion
policy offered pursuant to Section 12682.1; or a health insurance
policy offered to a federally eligible defined individual under
Chapter 9.5 (commencing with Section 10900).
10181.3. (a) (1) All health insurers shall file with the
department all required rate information for individual and small
group health insurance policies at least 60 days prior to
implementing any rate change.
(2) For individual health insurance policies, the filing shall be
concurrent with the notice required under Section 10113.9.
(3) For small group health insurance policies, the filing shall be
concurrent with the notice required under Section 10199.1.
(b) An insurer shall disclose to the department all of the
following for each individual and small group rate filing:
(1) Company name and contact information.
(2) Number of policy forms covered by the filing.
(3) Policy form numbers covered by the filing.
(4) Product type, such as indemnity or preferred provider
organization.
(5) Segment type.
(6) Type of insurer involved, such as for profit or not for
profit.
(7) Whether the products are opened or closed.
(8) Enrollment in each policy and rating form.
(9) Insured months in each policy form.
(10) Annual rate.
(11) Total earned premiums in each policy form.
(12) Total incurred claims in each policy form.
(13) Average rate increase initially requested.
(14) Review category: initial filing for new product, filing for
existing product, or resubmission.
(15) Average rate of increase.
(16) Effective date of rate increase.
(17) Number of policyholders or insureds affected by each policy
form.
(18) The insurer's overall annual medical trend factor assumptions
in each rate filing for all benefits and by aggregate benefit
category, including hospital inpatient, hospital outpatient,
physician services, prescription drugs and other ancillary services,
laboratory, and radiology. An insurer may provide aggregated
additional data that demonstrates or reasonably estimates
year-to-year cost increases in specific benefit categories in major
geographic regions of the state. For purposes of this paragraph,
"major geographic region" shall be defined by the department and
shall include no more than nine regions.
(19) The amount of the projected trend attributable to the use of
services, price inflation, or fees and risk for annual policy trends
by aggregate benefit category, such as hospital inpatient, hospital
outpatient, physician services, prescription drugs and other
ancillary services, laboratory, and radiology.
(20) A comparison of claims cost and rate of changes over time.
(21) Any changes in insured cost-sharing over the prior year
associated with the submitted rate filing.
(22) Any changes in insured benefits over the prior year
associated with the submitted rate filing.
(23) The certification described in subdivision (b) of Section
10181.6.
(24) Any changes in administrative costs.
(25) Any other information required for rate review under PPACA.
(c) An insurer subject to subdivision (a) shall also disclose the
following aggregate data for all rate filings submitted under this
section in the individual and small group health insurance markets:
(1) Number and percentage of rate filings reviewed by the
following:
(A) Plan year.
(B) Segment type.
(C) Product type.
(D) Number of policyholders.
(E) Number of covered lives affected.
(2) The insurer's average rate increase by the following
categories:
(A) Plan year.
(B) Segment type.
(C) Product type.
(3) Any cost containment and quality improvement efforts since the
insurer's last rate filing for the same category of health benefit
plan. To the extent possible, the insurer shall describe any
significant new health care cost containment and quality improvement
efforts and provide an estimate of potential savings together with an
estimated cost or savings for the projection period.
(d) The department may require all health insurers to submit all
rate filings to the National Association of Insurance Commissioners'
System for Electronic Rate and Form Filing (SERFF). Submission of the
required rate filings to SERFF shall be deemed to be filing with the
department for purposes of compliance with this section.
(e) A health insurer shall submit any other information required
under PPACA. A health insurer shall also submit any other information
required pursuant to any regulation adopted by the department to
comply with this article.
10181.4. (a) For large group health insurance policies, all health
insurers shall file with the department at least 60 days prior to
implementing any rate change all required rate information for
unreasonable rate increases. This filing shall be concurrent with the
written notice described in Section 10199.1.
(b) For large group rate filings, health insurers shall submit all
information that is required by PPACA. A health insurer shall also
submit any other information required pursuant to any regulation
adopted by the department to comply with this article.
(c) A health insurer subject to subdivision (a) shall also
disclose the following aggregate data for all rate filings submitted
under this section in the large group health insurance market:
(1) Number and percentage of rate filings reviewed by the
following:
(A) Plan year.
(B) Segment type.
(C) Product type.
(D) Number of insureds.
(E) Number of covered lives affected.
(2) The insurer's average rate increase by the following
categories:
(A) Plan year.
(B) Segment type.
(C) Product type.
(3) Any cost containment and quality improvement efforts since the
health insurer's last rate filing for the same category of health
insurance policy. To the extent possible, the health insurer shall
describe any significant new health care cost containment and quality
improvement efforts and provide an estimate of potential savings
together with an estimated cost or savings for the projection period.
(d) The department may require all health insurers to submit all
rate filings to the National Association of Insurance Commissioners'
System for Electronic Rate and Form Filing (SERFF). Submission of the
required rate filings to SERFF shall be deemed to be filing with the
department for purposes of compliance with this section.
10181.5. Notwithstanding any provision in a contract between a
health insurer and a provider, the department may request from a
health insurer any information required under this article or PPACA.
10181.6. (a) A filing submitted under this article shall be
actuarially sound.
(b) (1) The health insurer shall contract with an independent
actuary or actuaries consistent with this section.
(2) A filing submitted under this article shall include a
certification by an independent actuary or actuarial firm that the
rate increase is reasonable or unreasonable and, if unreasonable,
that the justification for the increase is based on accurate and
sound actuarial assumptions and methodologies. Unless PPACA requires
a certification of actuarial soundness for each large group health
insurance policy, a filing submitted under Section 10181.4 shall
include a certification by an independent actuary, as described in
this section, that the aggregate or average rate increase is based on
accurate and sound actuarial assumptions and methodologies.
(3) The actuary or actuarial firm acting under paragraph (2) shall
not be an affiliate or a subsidiary of, nor in any way owned or
controlled by, a health insurer or a trade association of health
insurers. A board member, director, officer, or employee of the
actuary or actuarial firm shall not serve as a board member,
director, or employee of a health insurer. A board member, director,
or officer of a health insurer or a trade association of health
insurers shall not serve as a board member, director, officer, or
employee of the actuary or actuarial firm.
(c) Nothing in this article shall be construed to permit the
commissioner to establish the rates charged insureds and
policyholders for covered health care services.
10181.7. (a) Notwithstanding Chapter 3.5 (commencing with Section
6250) of Division 7 of Title 1 of the Government Code, all
information submitted under this article shall be made publicly
available by the department except as provided in subdivision (b).
(b) Any contracted rates between a health insurer and a provider
shall be deemed confidential information that shall not be made
public by the department and are exempt from disclosure under the
California Public Records Act (Chapter 3.5 (commencing with Section
6250) of Division 7 of Title 1 of the Government Code). The
contracted rates between a health insurer and a large group shall be
deemed confidential information that shall not be made public by the
department and are exempt from disclosure under the California Public
Records Act (Chapter 3.5 (commencing with Section 6250) of Division
7 of Title 1 of the Government Code).
(c) All information submitted to the department under this article
shall be submitted electronically in order to facilitate review by
the department and the public.
(d) In addition, the department and the health insurer shall, at a
minimum, make the following information readily available to the
public on their Internet Web sites, in plain language and in a manner
and format specified by the department, except as provided in
subdivision (b). The information shall be made public for 60 days
prior to the implementation of the rate increase. The information
shall include:
(1) Justifications for any unreasonable rate increases, including
all information and supporting documentation as to why the rate
increase is justified.
(2) An insurer's overall annual medical trend factor assumptions
in each rate filing for all benefits.
(3) An insurer's actual costs, by aggregate benefit category to
include, hospital inpatient, hospital outpatient, physician services,
prescription drugs and other ancillary services, laboratory, and
radiology.
(4) The amount of the projected trend attributable to the use of
services, price inflation, or fees and risk for annual policy trends
by aggregate benefit category, such as hospital inpatient, hospital
outpatient, physician services, prescription drugs and other
ancillary services, laboratory, and radiology.
10181.9. (a) On or before July 1, 2012, the commissioner may issue
guidance to health insurers regarding compliance with this article.
This guidance shall not be subject to the Administrative Procedure
Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code).
(b) The department shall consult with the Department of Managed
Health Care in issuing guidance under subdivision (a), in adopting
necessary regulations, in posting information on its Internet Web
site under this article, and in taking any other action for the
purpose of implementing this article.
10181.11. (a) Whenever it appears to the department that any person
has engaged, or is about to engage, in any act or practice
constituting a violation of this article, including the filing of
inaccurate or unjustified rates or inaccurate or unjustified rate
information, the department may review rate filing to ensure
compliance with the law.
(b) The department may review other filings.
(c) The department shall accept and post to its Internet Web site
any public comment on a rate increase submitted to the department
during the 60-day period described in subdivision (d) of Section
10181.7.
(d) The department shall report to the Legislature at least
quarterly on all unreasonable rate filings.
(e) The department shall post on its Internet Web site any changes
submitted by the insurer to the proposed rate increase, including
any documentation submitted by the insurer supporting those changes.
(f) If the department finds that an unreasonable rate increase is
not justified or that a rate filing contains inaccurate information,
the department shall post its finding on its Internet Web site.
(g) Nothing in this article shall be construed to impair or impede
the department's authority to administer or enforce any other
provision of this code.
10181.13. The department shall do all of the following in a manner
consistent with applicable federal laws, rules, and regulations:
(a) Provide data to the United States Secretary of Health and
Human Services on health insurer rate trends in premium rating areas.
(b) Commencing with the creation of the Exchange, provide to the
Exchange such information as may be necessary to allow compliance
with federal law, rules, regulations, and guidance.
10181. For purposes of this article, the following definitions
shall apply:
(a) "Large group health insurance policy" means a group health
insurance policy other than a policy issued to a small employer, as
defined in Section 10700.
(b) "Small group health insurance policy" means a group health
insurance policy issued to a small employer, as defined in Section
10700.
(c) "PPACA" means Section 2794 of the federal Public Health
Service Act (42 U.S.C. Sec. 300gg-14), as amended by the federal
Patient Protection and Affordable Care Act (P. L. 111-48), and any
subsequent rules, regulations, or guidance issued pursuant to that
law.
(d) "Unreasonable rate increase" has the same meaning as that term
is defined in PPACA.
10181.2. This article shall apply to health insurance policies
offered in the individual or group market in California. However,
this article shall not apply to a specialized health insurance
policy; a Medicare supplement policy subject to Article 6 (commencing
with Section 10192.05); a health insurance policy offered in the
Medi-Cal program (Chapter 7 (commencing with Section 14000) of Part 3
of Division 9 of the Welfare and Institutions Code); a health
insurance policy offered in the Healthy Families Program (Part 6.2
(commencing with Section 12693)), the Access for Infants and Mothers
Program (Part 6.3 (commencing with Section 12695)), the California
Major Risk Medical Insurance Program (Part 6.5 (commencing with
Section 12700)), or the Federal Temporary High Risk Pool (Part 6.6
(commencing with Section 12739.5)); a health insurance conversion
policy offered pursuant to Section 12682.1; or a health insurance
policy offered to a federally eligible defined individual under
Chapter 9.5 (commencing with Section 10900).
10181.3. (a) (1) All health insurers shall file with the
department all required rate information for individual and small
group health insurance policies at least 60 days prior to
implementing any rate change.
(2) For individual health insurance policies, the filing shall be
concurrent with the notice required under Section 10113.9.
(3) For small group health insurance policies, the filing shall be
concurrent with the notice required under Section 10199.1.
(b) An insurer shall disclose to the department all of the
following for each individual and small group rate filing:
(1) Company name and contact information.
(2) Number of policy forms covered by the filing.
(3) Policy form numbers covered by the filing.
(4) Product type, such as indemnity or preferred provider
organization.
(5) Segment type.
(6) Type of insurer involved, such as for profit or not for
profit.
(7) Whether the products are opened or closed.
(8) Enrollment in each policy and rating form.
(9) Insured months in each policy form.
(10) Annual rate.
(11) Total earned premiums in each policy form.
(12) Total incurred claims in each policy form.
(13) Average rate increase initially requested.
(14) Review category: initial filing for new product, filing for
existing product, or resubmission.
(15) Average rate of increase.
(16) Effective date of rate increase.
(17) Number of policyholders or insureds affected by each policy
form.
(18) The insurer's overall annual medical trend factor assumptions
in each rate filing for all benefits and by aggregate benefit
category, including hospital inpatient, hospital outpatient,
physician services, prescription drugs and other ancillary services,
laboratory, and radiology. An insurer may provide aggregated
additional data that demonstrates or reasonably estimates
year-to-year cost increases in specific benefit categories in major
geographic regions of the state. For purposes of this paragraph,
"major geographic region" shall be defined by the department and
shall include no more than nine regions.
(19) The amount of the projected trend attributable to the use of
services, price inflation, or fees and risk for annual policy trends
by aggregate benefit category, such as hospital inpatient, hospital
outpatient, physician services, prescription drugs and other
ancillary services, laboratory, and radiology.
(20) A comparison of claims cost and rate of changes over time.
(21) Any changes in insured cost-sharing over the prior year
associated with the submitted rate filing.
(22) Any changes in insured benefits over the prior year
associated with the submitted rate filing.
(23) The certification described in subdivision (b) of Section
10181.6.
(24) Any changes in administrative costs.
(25) Any other information required for rate review under PPACA.
(c) An insurer subject to subdivision (a) shall also disclose the
following aggregate data for all rate filings submitted under this
section in the individual and small group health insurance markets:
(1) Number and percentage of rate filings reviewed by the
following:
(A) Plan year.
(B) Segment type.
(C) Product type.
(D) Number of policyholders.
(E) Number of covered lives affected.
(2) The insurer's average rate increase by the following
categories:
(A) Plan year.
(B) Segment type.
(C) Product type.
(3) Any cost containment and quality improvement efforts since the
insurer's last rate filing for the same category of health benefit
plan. To the extent possible, the insurer shall describe any
significant new health care cost containment and quality improvement
efforts and provide an estimate of potential savings together with an
estimated cost or savings for the projection period.
(d) The department may require all health insurers to submit all
rate filings to the National Association of Insurance Commissioners'
System for Electronic Rate and Form Filing (SERFF). Submission of the
required rate filings to SERFF shall be deemed to be filing with the
department for purposes of compliance with this section.
(e) A health insurer shall submit any other information required
under PPACA. A health insurer shall also submit any other information
required pursuant to any regulation adopted by the department to
comply with this article.
10181.4. (a) For large group health insurance policies, all health
insurers shall file with the department at least 60 days prior to
implementing any rate change all required rate information for
unreasonable rate increases. This filing shall be concurrent with the
written notice described in Section 10199.1.
(b) For large group rate filings, health insurers shall submit all
information that is required by PPACA. A health insurer shall also
submit any other information required pursuant to any regulation
adopted by the department to comply with this article.
(c) A health insurer subject to subdivision (a) shall also
disclose the following aggregate data for all rate filings submitted
under this section in the large group health insurance market:
(1) Number and percentage of rate filings reviewed by the
following:
(A) Plan year.
(B) Segment type.
(C) Product type.
(D) Number of insureds.
(E) Number of covered lives affected.
(2) The insurer's average rate increase by the following
categories:
(A) Plan year.
(B) Segment type.
(C) Product type.
(3) Any cost containment and quality improvement efforts since the
health insurer's last rate filing for the same category of health
insurance policy. To the extent possible, the health insurer shall
describe any significant new health care cost containment and quality
improvement efforts and provide an estimate of potential savings
together with an estimated cost or savings for the projection period.
(d) The department may require all health insurers to submit all
rate filings to the National Association of Insurance Commissioners'
System for Electronic Rate and Form Filing (SERFF). Submission of the
required rate filings to SERFF shall be deemed to be filing with the
department for purposes of compliance with this section.
10181.5. Notwithstanding any provision in a contract between a
health insurer and a provider, the department may request from a
health insurer any information required under this article or PPACA.
10181.6. (a) A filing submitted under this article shall be
actuarially sound.
(b) (1) The health insurer shall contract with an independent
actuary or actuaries consistent with this section.
(2) A filing submitted under this article shall include a
certification by an independent actuary or actuarial firm that the
rate increase is reasonable or unreasonable and, if unreasonable,
that the justification for the increase is based on accurate and
sound actuarial assumptions and methodologies. Unless PPACA requires
a certification of actuarial soundness for each large group health
insurance policy, a filing submitted under Section 10181.4 shall
include a certification by an independent actuary, as described in
this section, that the aggregate or average rate increase is based on
accurate and sound actuarial assumptions and methodologies.
(3) The actuary or actuarial firm acting under paragraph (2) shall
not be an affiliate or a subsidiary of, nor in any way owned or
controlled by, a health insurer or a trade association of health
insurers. A board member, director, officer, or employee of the
actuary or actuarial firm shall not serve as a board member,
director, or employee of a health insurer. A board member, director,
or officer of a health insurer or a trade association of health
insurers shall not serve as a board member, director, officer, or
employee of the actuary or actuarial firm.
(c) Nothing in this article shall be construed to permit the
commissioner to establish the rates charged insureds and
policyholders for covered health care services.
10181.7. (a) Notwithstanding Chapter 3.5 (commencing with Section
6250) of Division 7 of Title 1 of the Government Code, all
information submitted under this article shall be made publicly
available by the department except as provided in subdivision (b).
(b) Any contracted rates between a health insurer and a provider
shall be deemed confidential information that shall not be made
public by the department and are exempt from disclosure under the
California Public Records Act (Chapter 3.5 (commencing with Section
6250) of Division 7 of Title 1 of the Government Code). The
contracted rates between a health insurer and a large group shall be
deemed confidential information that shall not be made public by the
department and are exempt from disclosure under the California Public
Records Act (Chapter 3.5 (commencing with Section 6250) of Division
7 of Title 1 of the Government Code).
(c) All information submitted to the department under this article
shall be submitted electronically in order to facilitate review by
the department and the public.
(d) In addition, the department and the health insurer shall, at a
minimum, make the following information readily available to the
public on their Internet Web sites, in plain language and in a manner
and format specified by the department, except as provided in
subdivision (b). The information shall be made public for 60 days
prior to the implementation of the rate increase. The information
shall include:
(1) Justifications for any unreasonable rate increases, including
all information and supporting documentation as to why the rate
increase is justified.
(2) An insurer's overall annual medical trend factor assumptions
in each rate filing for all benefits.
(3) An insurer's actual costs, by aggregate benefit category to
include, hospital inpatient, hospital outpatient, physician services,
prescription drugs and other ancillary services, laboratory, and
radiology.
(4) The amount of the projected trend attributable to the use of
services, price inflation, or fees and risk for annual policy trends
by aggregate benefit category, such as hospital inpatient, hospital
outpatient, physician services, prescription drugs and other
ancillary services, laboratory, and radiology.
10181.9. (a) On or before July 1, 2012, the commissioner may issue
guidance to health insurers regarding compliance with this article.
This guidance shall not be subject to the Administrative Procedure
Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code).
(b) The department shall consult with the Department of Managed
Health Care in issuing guidance under subdivision (a), in adopting
necessary regulations, in posting information on its Internet Web
site under this article, and in taking any other action for the
purpose of implementing this article.
10181.11. (a) Whenever it appears to the department that any person
has engaged, or is about to engage, in any act or practice
constituting a violation of this article, including the filing of
inaccurate or unjustified rates or inaccurate or unjustified rate
information, the department may review rate filing to ensure
compliance with the law.
(b) The department may review other filings.
(c) The department shall accept and post to its Internet Web site
any public comment on a rate increase submitted to the department
during the 60-day period described in subdivision (d) of Section
10181.7.
(d) The department shall report to the Legislature at least
quarterly on all unreasonable rate filings.
(e) The department shall post on its Internet Web site any changes
submitted by the insurer to the proposed rate increase, including
any documentation submitted by the insurer supporting those changes.
(f) If the department finds that an unreasonable rate increase is
not justified or that a rate filing contains inaccurate information,
the department shall post its finding on its Internet Web site.
(g) Nothing in this article shall be construed to impair or impede
the department's authority to administer or enforce any other
provision of this code.
10181.13. The department shall do all of the following in a manner
consistent with applicable federal laws, rules, and regulations:
(a) Provide data to the United States Secretary of Health and
Human Services on health insurer rate trends in premium rating areas.
(b) Commencing with the creation of the Exchange, provide to the
Exchange such information as may be necessary to allow compliance
with federal law, rules, regulations, and guidance.
10181. For purposes of this article, the following definitions
shall apply:
(a) "Large group health insurance policy" means a group health
insurance policy other than a policy issued to a small employer, as
defined in Section 10700.
(b) "Small group health insurance policy" means a group health
insurance policy issued to a small employer, as defined in Section
10700.
(c) "PPACA" means Section 2794 of the federal Public Health
Service Act (42 U.S.C. Sec. 300gg-14), as amended by the federal
Patient Protection and Affordable Care Act (P. L. 111-48), and any
subsequent rules, regulations, or guidance issued pursuant to that
law.
(d) "Unreasonable rate increase" has the same meaning as that term
is defined in PPACA.
10181.2. This article shall apply to health insurance policies
offered in the individual or group market in California. However,
this article shall not apply to a specialized health insurance
policy; a Medicare supplement policy subject to Article 6 (commencing
with Section 10192.05); a health insurance policy offered in the
Medi-Cal program (Chapter 7 (commencing with Section 14000) of Part 3
of Division 9 of the Welfare and Institutions Code); a health
insurance policy offered in the Healthy Families Program (Part 6.2
(commencing with Section 12693)), the Access for Infants and Mothers
Program (Part 6.3 (commencing with Section 12695)), the California
Major Risk Medical Insurance Program (Part 6.5 (commencing with
Section 12700)), or the Federal Temporary High Risk Pool (Part 6.6
(commencing with Section 12739.5)); a health insurance conversion
policy offered pursuant to Section 12682.1; or a health insurance
policy offered to a federally eligible defined individual under
Chapter 9.5 (commencing with Section 10900).
10181.3. (a) (1) All health insurers shall file with the
department all required rate information for individual and small
group health insurance policies at least 60 days prior to
implementing any rate change.
(2) For individual health insurance policies, the filing shall be
concurrent with the notice required under Section 10113.9.
(3) For small group health insurance policies, the filing shall be
concurrent with the notice required under Section 10199.1.
(b) An insurer shall disclose to the department all of the
following for each individual and small group rate filing:
(1) Company name and contact information.
(2) Number of policy forms covered by the filing.
(3) Policy form numbers covered by the filing.
(4) Product type, such as indemnity or preferred provider
organization.
(5) Segment type.
(6) Type of insurer involved, such as for profit or not for
profit.
(7) Whether the products are opened or closed.
(8) Enrollment in each policy and rating form.
(9) Insured months in each policy form.
(10) Annual rate.
(11) Total earned premiums in each policy form.
(12) Total incurred claims in each policy form.
(13) Average rate increase initially requested.
(14) Review category: initial filing for new product, filing for
existing product, or resubmission.
(15) Average rate of increase.
(16) Effective date of rate increase.
(17) Number of policyholders or insureds affected by each policy
form.
(18) The insurer's overall annual medical trend factor assumptions
in each rate filing for all benefits and by aggregate benefit
category, including hospital inpatient, hospital outpatient,
physician services, prescription drugs and other ancillary services,
laboratory, and radiology. An insurer may provide aggregated
additional data that demonstrates or reasonably estimates
year-to-year cost increases in specific benefit categories in major
geographic regions of the state. For purposes of this paragraph,
"major geographic region" shall be defined by the department and
shall include no more than nine regions.
(19) The amount of the projected trend attributable to the use of
services, price inflation, or fees and risk for annual policy trends
by aggregate benefit category, such as hospital inpatient, hospital
outpatient, physician services, prescription drugs and other
ancillary services, laboratory, and radiology.
(20) A comparison of claims cost and rate of changes over time.
(21) Any changes in insured cost-sharing over the prior year
associated with the submitted rate filing.
(22) Any changes in insured benefits over the prior year
associated with the submitted rate filing.
(23) The certification described in subdivision (b) of Section
10181.6.
(24) Any changes in administrative costs.
(25) Any other information required for rate review under PPACA.
(c) An insurer subject to subdivision (a) shall also disclose the
following aggregate data for all rate filings submitted under this
section in the individual and small group health insurance markets:
(1) Number and percentage of rate filings reviewed by the
following:
(A) Plan year.
(B) Segment type.
(C) Product type.
(D) Number of policyholders.
(E) Number of covered lives affected.
(2) The insurer's average rate increase by the following
categories:
(A) Plan year.
(B) Segment type.
(C) Product type.
(3) Any cost containment and quality improvement efforts since the
insurer's last rate filing for the same category of health benefit
plan. To the extent possible, the insurer shall describe any
significant new health care cost containment and quality improvement
efforts and provide an estimate of potential savings together with an
estimated cost or savings for the projection period.
(d) The department may require all health insurers to submit all
rate filings to the National Association of Insurance Commissioners'
System for Electronic Rate and Form Filing (SERFF). Submission of the
required rate filings to SERFF shall be deemed to be filing with the
department for purposes of compliance with this section.
(e) A health insurer shall submit any other information required
under PPACA. A health insurer shall also submit any other information
required pursuant to any regulation adopted by the department to
comply with this article.
10181.4. (a) For large group health insurance policies, all health
insurers shall file with the department at least 60 days prior to
implementing any rate change all required rate information for
unreasonable rate increases. This filing shall be concurrent with the
written notice described in Section 10199.1.
(b) For large group rate filings, health insurers shall submit all
information that is required by PPACA. A health insurer shall also
submit any other information required pursuant to any regulation
adopted by the department to comply with this article.
(c) A health insurer subject to subdivision (a) shall also
disclose the following aggregate data for all rate filings submitted
under this section in the large group health insurance market:
(1) Number and percentage of rate filings reviewed by the
following:
(A) Plan year.
(B) Segment type.
(C) Product type.
(D) Number of insureds.
(E) Number of covered lives affected.
(2) The insurer's average rate increase by the following
categories:
(A) Plan year.
(B) Segment type.
(C) Product type.
(3) Any cost containment and quality improvement efforts since the
health insurer's last rate filing for the same category of health
insurance policy. To the extent possible, the health insurer shall
describe any significant new health care cost containment and quality
improvement efforts and provide an estimate of potential savings
together with an estimated cost or savings for the projection period.
(d) The department may require all health insurers to submit all
rate filings to the National Association of Insurance Commissioners'
System for Electronic Rate and Form Filing (SERFF). Submission of the
required rate filings to SERFF shall be deemed to be filing with the
department for purposes of compliance with this section.
10181.5. Notwithstanding any provision in a contract between a
health insurer and a provider, the department may request from a
health insurer any information required under this article or PPACA.
10181.6. (a) A filing submitted under this article shall be
actuarially sound.
(b) (1) The health insurer shall contract with an independent
actuary or actuaries consistent with this section.
(2) A filing submitted under this article shall include a
certification by an independent actuary or actuarial firm that the
rate increase is reasonable or unreasonable and, if unreasonable,
that the justification for the increase is based on accurate and
sound actuarial assumptions and methodologies. Unless PPACA requires
a certification of actuarial soundness for each large group health
insurance policy, a filing submitted under Section 10181.4 shall
include a certification by an independent actuary, as described in
this section, that the aggregate or average rate increase is based on
accurate and sound actuarial assumptions and methodologies.
(3) The actuary or actuarial firm acting under paragraph (2) shall
not be an affiliate or a subsidiary of, nor in any way owned or
controlled by, a health insurer or a trade association of health
insurers. A board member, director, officer, or employee of the
actuary or actuarial firm shall not serve as a board member,
director, or employee of a health insurer. A board member, director,
or officer of a health insurer or a trade association of health
insurers shall not serve as a board member, director, officer, or
employee of the actuary or actuarial firm.
(c) Nothing in this article shall be construed to permit the
commissioner to establish the rates charged insureds and
policyholders for covered health care services.
10181.7. (a) Notwithstanding Chapter 3.5 (commencing with Section
6250) of Division 7 of Title 1 of the Government Code, all
information submitted under this article shall be made publicly
available by the department except as provided in subdivision (b).
(b) Any contracted rates between a health insurer and a provider
shall be deemed confidential information that shall not be made
public by the department and are exempt from disclosure under the
California Public Records Act (Chapter 3.5 (commencing with Section
6250) of Division 7 of Title 1 of the Government Code). The
contracted rates between a health insurer and a large group shall be
deemed confidential information that shall not be made public by the
department and are exempt from disclosure under the California Public
Records Act (Chapter 3.5 (commencing with Section 6250) of Division
7 of Title 1 of the Government Code).
(c) All information submitted to the department under this article
shall be submitted electronically in order to facilitate review by
the department and the public.
(d) In addition, the department and the health insurer shall, at a
minimum, make the following information readily available to the
public on their Internet Web sites, in plain language and in a manner
and format specified by the department, except as provided in
subdivision (b). The information shall be made public for 60 days
prior to the implementation of the rate increase. The information
shall include:
(1) Justifications for any unreasonable rate increases, including
all information and supporting documentation as to why the rate
increase is justified.
(2) An insurer's overall annual medical trend factor assumptions
in each rate filing for all benefits.
(3) An insurer's actual costs, by aggregate benefit category to
include, hospital inpatient, hospital outpatient, physician services,
prescription drugs and other ancillary services, laboratory, and
radiology.
(4) The amount of the projected trend attributable to the use of
services, price inflation, or fees and risk for annual policy trends
by aggregate benefit category, such as hospital inpatient, hospital
outpatient, physician services, prescription drugs and other
ancillary services, laboratory, and radiology.
10181.9. (a) On or before July 1, 2012, the commissioner may issue
guidance to health insurers regarding compliance with this article.
This guidance shall not be subject to the Administrative Procedure
Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code).
(b) The department shall consult with the Department of Managed
Health Care in issuing guidance under subdivision (a), in adopting
necessary regulations, in posting information on its Internet Web
site under this article, and in taking any other action for the
purpose of implementing this article.
10181.11. (a) Whenever it appears to the department that any person
has engaged, or is about to engage, in any act or practice
constituting a violation of this article, including the filing of
inaccurate or unjustified rates or inaccurate or unjustified rate
information, the department may review rate filing to ensure
compliance with the law.
(b) The department may review other filings.
(c) The department shall accept and post to its Internet Web site
any public comment on a rate increase submitted to the department
during the 60-day period described in subdivision (d) of Section
10181.7.
(d) The department shall report to the Legislature at least
quarterly on all unreasonable rate filings.
(e) The department shall post on its Internet Web site any changes
submitted by the insurer to the proposed rate increase, including
any documentation submitted by the insurer supporting those changes.
(f) If the department finds that an unreasonable rate increase is
not justified or that a rate filing contains inaccurate information,
the department shall post its finding on its Internet Web site.
(g) Nothing in this article shall be construed to impair or impede
the department's authority to administer or enforce any other
provision of this code.
10181.13. The department shall do all of the following in a manner
consistent with applicable federal laws, rules, and regulations:
(a) Provide data to the United States Secretary of Health and
Human Services on health insurer rate trends in premium rating areas.
(b) Commencing with the creation of the Exchange, provide to the
Exchange such information as may be necessary to allow compliance
with federal law, rules, regulations, and guidance.
