Premium rates, subject to conditions--no transfer out of class ofbusiness--disclosure required, contents--rating and renewalrecords required to be kept.
379.936. 1. Premium rates for health benefit plans subject tosections 379.930 to 379.952 shall be subject to the following provisions:
(1) The index rate for a rating period for any class of businessshall not exceed the index rate for any other class of business by morethan twenty percent;
(2) For a class of business, the premium rates charged during arating period to small employers with similar case characteristics for thesame or similar coverage, or the rates that could be charged to suchemployers under the rating system for that class of business shall not varyfrom the index rate by more than thirty-five percent of the index rate;
(3) The percentage increase in the premium rate charged to a smallemployer for a new rating period may not exceed the sum of the following:
(a) The percentage change in the new business premium rate measuredfrom the first day of the prior rating period to the first day of the newrating period. In the case of a health benefit plan into which the smallemployer carrier is no longer enrolling new small employers, the smallemployer carrier shall use the percentage change in the base premium rate,provided that such change does not exceed, on a percentage basis, thechange in the new business premium rate for the most similar health benefitplan into which the small employer carrier is actively enrolling new smallemployers;
(b) Any adjustment, not to exceed fifteen percent annually andadjusted pro rata for rating periods of less than one year, due to theclaim experience, health status or duration of coverage of the employees ordependents of the small employer as determined from the small employercarrier's rate manual for the class of business; and
(c) Any adjustment due to change in coverage or change in the casecharacteristics of the small employer, as determined from the smallemployer carrier's rate manual for the class of business;
(4) Adjustments in rates for claim experience, health status andduration of coverage shall not be charged to individual employees ordependents. Any such adjustment shall be applied uniformly to the ratescharged for all employees and dependents of the small employer;
(5) Premium rates for health benefit plans shall comply with therequirements of this section notwithstanding any assessments paid orpayable by small employer carriers pursuant to sections 379.942 and379.943;
(6) A small employer carrier may utilize the employer's industry as acase characteristic in establishing premium rates, provided that the ratefactor associated with any industry classification shall not vary by morethan ten percent from the arithmetic mean of the highest and lowest ratefactors associated with all industry classifications;
(7) In the case of health benefit plans issued prior to July 1, 1993,a premium rate for a rating period may exceed the ranges set forth insubdivisions (1) and (2) of this subsection for a period of three yearsfollowing July 1, 1993. In such case, the percentage increase in thepremium rate charged to a small employer for a new rating period shall notexceed the sum of the following:
(a) The percentage change in the new business premium rate measuredfrom the first day of the prior rating period to the first day of the newrating period. In the case of a health benefit plan into which the smallemployer carrier is no longer enrolling new small employers, the smallemployer carrier shall use the percentage change in the base premium rate,provided that such change does not exceed, on a percentage basis, thechange in the new business premium rate for the most similar health benefitplan into which the small employer carrier is actively enrolling new smallemployers;
(b) Any adjustment due to change in coverage or change in the casecharacteristics of the small employer, as determined from the carrier'srate manual for the class of business;
(8) (a) Small employer carriers shall apply rating factors,including case characteristics, consistently with respect to all smallemployers in a class of business. Rating factors shall produce premiumsfor identical groups which differ only by amounts attributable to plandesign and do not reflect differences due to the nature of the groupsassumed to select particular health benefit plans;
(b) A small employer carrier shall treat all health benefit plansissued or renewed in the same calendar month as having the same ratingperiod;
(9) For the purposes of this subsection, a health benefit plan thatutilizes a restricted provider network shall not be considered similarcoverage to a health benefit plan that does not utilize such a network,provided that utilization of the restricted provider network results insubstantial differences in claims costs;
(10) A small employer carrier shall not use case characteristics,other than age, sex, industry, geographic area, family composition, andgroup size without prior approval of the director;
(11) The director may promulgate rules to implement the provisions ofthis section and to assure that rating practices used by small employercarriers are consistent with the purposes of sections 379.930 to 379.952,including:
(a) Assuring that differences in rates charged for health benefitplans by small employer carriers are reasonable and reflect objectivedifferences in plan design, not including differences due to the nature ofthe groups assumed to select particular health benefit plans; and
(b) Prescribing the manner in which case characteristics may be usedby small employer carriers.
2. A small employer carrier shall not transfer a small employerinvoluntarily into or out of a class of business. A small employer carriershall not offer to transfer a small employer into or out of a class ofbusiness unless such offer is made to transfer all small employers in theclass of business without regard to case characteristics, claim experience,health status or duration of coverage.
3. The director may suspend for a specified period the application ofsubdivision (1) of subsection 1 of this section as to the premium ratesapplicable to one or more small employers included within a class ofbusiness of a small employer carrier for one or more rating periods upon afiling by the small employer carrier and a finding by the director eitherthat the suspension is reasonable in light of the financial condition ofthe small employer carrier or that the suspension would enhance theefficiency and fairness of the marketplace for small employer healthinsurance.
4. In connection with the offering for sale of any health benefitplan to a small employer, a small employer carrier shall make a reasonabledisclosure, as part of its solicitation and sales materials, of all of thefollowing:
(1) The extent to which premium rates for a specified small employerare established or adjusted based upon the actual or expected variation inclaims costs or actual or expected variation in health status of theemployees of the small employer and their dependents;
(2) The provisions of the health benefit plan concerning the smallemployer carrier's right to change premium rates and factors, other thanclaim experience, that affect changes in premium rates;
(3) The provisions relating to renewability of policies andcontracts; and
(4) The provisions relating to any preexisting condition provision.
5. (1) Each small employer carrier shall maintain at its principalplace of business a complete and detailed description of its ratingpractices and renewal underwriting practices, including information anddocumentation that demonstrate that its rating methods and practices arebased upon commonly accepted actuarial assumptions and are in accordancewith sound actuarial principles.
(2) Each small employer carrier shall file with the director annuallyon or before March fifteenth an actuarial certification certifying that thecarrier is in compliance with sections 379.930 to 379.952 and that therating methods of the small employer carrier are actuarially sound. Suchcertification shall be in a form and manner, and shall contain suchinformation, as specified by the director. A copy of the certificationshall be retained by the small employer carrier at its principal place ofbusiness.
(3) A small employer carrier shall make the information anddocumentation described in subdivision (1) of this section available to thedirector upon request.
Premium rates, subject to conditions--no transfer out of class ofbusiness--disclosure required, contents--rating and renewalrecords required to be kept.
379.936. 1. Premium rates for health benefit plans subject tosections 379.930 to 379.952 shall be subject to the following provisions:
(1) The index rate for a rating period for any class of businessshall not exceed the index rate for any other class of business by morethan twenty percent;
(2) For a class of business, the premium rates charged during arating period to small employers with similar case characteristics for thesame or similar coverage, or the rates that could be charged to suchemployers under the rating system for that class of business shall not varyfrom the index rate by more than thirty-five percent of the index rate;
(3) The percentage increase in the premium rate charged to a smallemployer for a new rating period may not exceed the sum of the following:
(a) The percentage change in the new business premium rate measuredfrom the first day of the prior rating period to the first day of the newrating period. In the case of a health benefit plan into which the smallemployer carrier is no longer enrolling new small employers, the smallemployer carrier shall use the percentage change in the base premium rate,provided that such change does not exceed, on a percentage basis, thechange in the new business premium rate for the most similar health benefitplan into which the small employer carrier is actively enrolling new smallemployers;
(b) Any adjustment, not to exceed fifteen percent annually andadjusted pro rata for rating periods of less than one year, due to theclaim experience, health status or duration of coverage of the employees ordependents of the small employer as determined from the small employercarrier's rate manual for the class of business; and
(c) Any adjustment due to change in coverage or change in the casecharacteristics of the small employer, as determined from the smallemployer carrier's rate manual for the class of business;
(4) Adjustments in rates for claim experience, health status andduration of coverage shall not be charged to individual employees ordependents. Any such adjustment shall be applied uniformly to the ratescharged for all employees and dependents of the small employer;
(5) Premium rates for health benefit plans shall comply with therequirements of this section notwithstanding any assessments paid orpayable by small employer carriers pursuant to sections 379.942 and379.943;
(6) A small employer carrier may utilize the employer's industry as acase characteristic in establishing premium rates, provided that the ratefactor associated with any industry classification shall not vary by morethan ten percent from the arithmetic mean of the highest and lowest ratefactors associated with all industry classifications;
(7) In the case of health benefit plans issued prior to July 1, 1993,a premium rate for a rating period may exceed the ranges set forth insubdivisions (1) and (2) of this subsection for a period of three yearsfollowing July 1, 1993. In such case, the percentage increase in thepremium rate charged to a small employer for a new rating period shall notexceed the sum of the following:
(a) The percentage change in the new business premium rate measuredfrom the first day of the prior rating period to the first day of the newrating period. In the case of a health benefit plan into which the smallemployer carrier is no longer enrolling new small employers, the smallemployer carrier shall use the percentage change in the base premium rate,provided that such change does not exceed, on a percentage basis, thechange in the new business premium rate for the most similar health benefitplan into which the small employer carrier is actively enrolling new smallemployers;
(b) Any adjustment due to change in coverage or change in the casecharacteristics of the small employer, as determined from the carrier'srate manual for the class of business;
(8) (a) Small employer carriers shall apply rating factors,including case characteristics, consistently with respect to all smallemployers in a class of business. Rating factors shall produce premiumsfor identical groups which differ only by amounts attributable to plandesign and do not reflect differences due to the nature of the groupsassumed to select particular health benefit plans;
(b) A small employer carrier shall treat all health benefit plansissued or renewed in the same calendar month as having the same ratingperiod;
(9) For the purposes of this subsection, a health benefit plan thatutilizes a restricted provider network shall not be considered similarcoverage to a health benefit plan that does not utilize such a network,provided that utilization of the restricted provider network results insubstantial differences in claims costs;
(10) A small employer carrier shall not use case characteristics,other than age, sex, industry, geographic area, family composition, andgroup size without prior approval of the director;
(11) The director may promulgate rules to implement the provisions ofthis section and to assure that rating practices used by small employercarriers are consistent with the purposes of sections 379.930 to 379.952,including:
(a) Assuring that differences in rates charged for health benefitplans by small employer carriers are reasonable and reflect objectivedifferences in plan design, not including differences due to the nature ofthe groups assumed to select particular health benefit plans; and
(b) Prescribing the manner in which case characteristics may be usedby small employer carriers.
2. A small employer carrier shall not transfer a small employerinvoluntarily into or out of a class of business. A small employer carriershall not offer to transfer a small employer into or out of a class ofbusiness unless such offer is made to transfer all small employers in theclass of business without regard to case characteristics, claim experience,health status or duration of coverage.
3. The director may suspend for a specified period the application ofsubdivision (1) of subsection 1 of this section as to the premium ratesapplicable to one or more small employers included within a class ofbusiness of a small employer carrier for one or more rating periods upon afiling by the small employer carrier and a finding by the director eitherthat the suspension is reasonable in light of the financial condition ofthe small employer carrier or that the suspension would enhance theefficiency and fairness of the marketplace for small employer healthinsurance.
4. In connection with the offering for sale of any health benefitplan to a small employer, a small employer carrier shall make a reasonabledisclosure, as part of its solicitation and sales materials, of all of thefollowing:
(1) The extent to which premium rates for a specified small employerare established or adjusted based upon the actual or expected variation inclaims costs or actual or expected variation in health status of theemployees of the small employer and their dependents;
(2) The provisions of the health benefit plan concerning the smallemployer carrier's right to change premium rates and factors, other thanclaim experience, that affect changes in premium rates;
(3) The provisions relating to renewability of policies andcontracts; and
(4) The provisions relating to any preexisting condition provision.
5. (1) Each small employer carrier shall maintain at its principalplace of business a complete and detailed description of its ratingpractices and renewal underwriting practices, including information anddocumentation that demonstrate that its rating methods and practices arebased upon commonly accepted actuarial assumptions and are in accordancewith sound actuarial principles.
(2) Each small employer carrier shall file with the director annuallyon or before March fifteenth an actuarial certification certifying that thecarrier is in compliance with sections 379.930 to 379.952 and that therating methods of the small employer carrier are actuarially sound. Suchcertification shall be in a form and manner, and shall contain suchinformation, as specified by the director. A copy of the certificationshall be retained by the small employer carrier at its principal place ofbusiness.
(3) A small employer carrier shall make the information anddocumentation described in subdivision (1) of this section available to thedirector upon request.
Premium rates, subject to conditions--no transfer out of class ofbusiness--disclosure required, contents--rating and renewalrecords required to be kept.
379.936. 1. Premium rates for health benefit plans subject tosections 379.930 to 379.952 shall be subject to the following provisions:
(1) The index rate for a rating period for any class of businessshall not exceed the index rate for any other class of business by morethan twenty percent;
(2) For a class of business, the premium rates charged during arating period to small employers with similar case characteristics for thesame or similar coverage, or the rates that could be charged to suchemployers under the rating system for that class of business shall not varyfrom the index rate by more than thirty-five percent of the index rate;
(3) The percentage increase in the premium rate charged to a smallemployer for a new rating period may not exceed the sum of the following:
(a) The percentage change in the new business premium rate measuredfrom the first day of the prior rating period to the first day of the newrating period. In the case of a health benefit plan into which the smallemployer carrier is no longer enrolling new small employers, the smallemployer carrier shall use the percentage change in the base premium rate,provided that such change does not exceed, on a percentage basis, thechange in the new business premium rate for the most similar health benefitplan into which the small employer carrier is actively enrolling new smallemployers;
(b) Any adjustment, not to exceed fifteen percent annually andadjusted pro rata for rating periods of less than one year, due to theclaim experience, health status or duration of coverage of the employees ordependents of the small employer as determined from the small employercarrier's rate manual for the class of business; and
(c) Any adjustment due to change in coverage or change in the casecharacteristics of the small employer, as determined from the smallemployer carrier's rate manual for the class of business;
(4) Adjustments in rates for claim experience, health status andduration of coverage shall not be charged to individual employees ordependents. Any such adjustment shall be applied uniformly to the ratescharged for all employees and dependents of the small employer;
(5) Premium rates for health benefit plans shall comply with therequirements of this section notwithstanding any assessments paid orpayable by small employer carriers pursuant to sections 379.942 and379.943;
(6) A small employer carrier may utilize the employer's industry as acase characteristic in establishing premium rates, provided that the ratefactor associated with any industry classification shall not vary by morethan ten percent from the arithmetic mean of the highest and lowest ratefactors associated with all industry classifications;
(7) In the case of health benefit plans issued prior to July 1, 1993,a premium rate for a rating period may exceed the ranges set forth insubdivisions (1) and (2) of this subsection for a period of three yearsfollowing July 1, 1993. In such case, the percentage increase in thepremium rate charged to a small employer for a new rating period shall notexceed the sum of the following:
(a) The percentage change in the new business premium rate measuredfrom the first day of the prior rating period to the first day of the newrating period. In the case of a health benefit plan into which the smallemployer carrier is no longer enrolling new small employers, the smallemployer carrier shall use the percentage change in the base premium rate,provided that such change does not exceed, on a percentage basis, thechange in the new business premium rate for the most similar health benefitplan into which the small employer carrier is actively enrolling new smallemployers;
(b) Any adjustment due to change in coverage or change in the casecharacteristics of the small employer, as determined from the carrier'srate manual for the class of business;
(8) (a) Small employer carriers shall apply rating factors,including case characteristics, consistently with respect to all smallemployers in a class of business. Rating factors shall produce premiumsfor identical groups which differ only by amounts attributable to plandesign and do not reflect differences due to the nature of the groupsassumed to select particular health benefit plans;
(b) A small employer carrier shall treat all health benefit plansissued or renewed in the same calendar month as having the same ratingperiod;
(9) For the purposes of this subsection, a health benefit plan thatutilizes a restricted provider network shall not be considered similarcoverage to a health benefit plan that does not utilize such a network,provided that utilization of the restricted provider network results insubstantial differences in claims costs;
(10) A small employer carrier shall not use case characteristics,other than age, sex, industry, geographic area, family composition, andgroup size without prior approval of the director;
(11) The director may promulgate rules to implement the provisions ofthis section and to assure that rating practices used by small employercarriers are consistent with the purposes of sections 379.930 to 379.952,including:
(a) Assuring that differences in rates charged for health benefitplans by small employer carriers are reasonable and reflect objectivedifferences in plan design, not including differences due to the nature ofthe groups assumed to select particular health benefit plans; and
(b) Prescribing the manner in which case characteristics may be usedby small employer carriers.
2. A small employer carrier shall not transfer a small employerinvoluntarily into or out of a class of business. A small employer carriershall not offer to transfer a small employer into or out of a class ofbusiness unless such offer is made to transfer all small employers in theclass of business without regard to case characteristics, claim experience,health status or duration of coverage.
3. The director may suspend for a specified period the application ofsubdivision (1) of subsection 1 of this section as to the premium ratesapplicable to one or more small employers included within a class ofbusiness of a small employer carrier for one or more rating periods upon afiling by the small employer carrier and a finding by the director eitherthat the suspension is reasonable in light of the financial condition ofthe small employer carrier or that the suspension would enhance theefficiency and fairness of the marketplace for small employer healthinsurance.
4. In connection with the offering for sale of any health benefitplan to a small employer, a small employer carrier shall make a reasonabledisclosure, as part of its solicitation and sales materials, of all of thefollowing:
(1) The extent to which premium rates for a specified small employerare established or adjusted based upon the actual or expected variation inclaims costs or actual or expected variation in health status of theemployees of the small employer and their dependents;
(2) The provisions of the health benefit plan concerning the smallemployer carrier's right to change premium rates and factors, other thanclaim experience, that affect changes in premium rates;
(3) The provisions relating to renewability of policies andcontracts; and
(4) The provisions relating to any preexisting condition provision.
5. (1) Each small employer carrier shall maintain at its principalplace of business a complete and detailed description of its ratingpractices and renewal underwriting practices, including information anddocumentation that demonstrate that its rating methods and practices arebased upon commonly accepted actuarial assumptions and are in accordancewith sound actuarial principles.
(2) Each small employer carrier shall file with the director annuallyon or before March fifteenth an actuarial certification certifying that thecarrier is in compliance with sections 379.930 to 379.952 and that therating methods of the small employer carrier are actuarially sound. Suchcertification shall be in a form and manner, and shall contain suchinformation, as specified by the director. A copy of the certificationshall be retained by the small employer carrier at its principal place ofbusiness.
(3) A small employer carrier shall make the information anddocumentation described in subdivision (1) of this section available to thedirector upon request.
