State Codes and Statutes

Statutes > New-jersey > Title-17 > Section-17-48 > 17-48-6-9

17:48-6.9.  Adjustment of rates;  experience rating formulas;  approval
    Any group contract, covering at least 50 employees or members, may provide for the adjustment of the rate of premium at the end of the first year or any subsequent year of insurance thereunder based on the experience thereunder both  past and contemplated.  No hospital service corporation shall use any form of  experience rating plan until it shall have filed with the commissioner the  formulas to be used and the classes of groups to which they are to apply.  The  commissioner may disapprove the formulas or classes at any time if he finds  that the rates produced thereby are excessive, inadequate or unfairly  discriminatory or that the formulas or classes are such as to prejudice the  interests of persons who are eligible for hospital services under contracts  with the hospital service corporation which are not subject to experience  rating.

    Excluding those rating formulas applicable to groups the employees or members of which are located in more than one state and which are underwritten in participation with other corporation(s) of other state(s), no rating formula  shall be approved by the commissioner unless it provides that the experience  rated groups will be assessed a reasonable community charge.  Any such rating  formula may provide for the allowance of an equitable discount in the event the  policyholder agrees to perform certain administrative and record keeping  functions in connection with the routine maintenance of the group account.

    Nothing in this section shall preclude the hospital service corporation from  incorporating in the rate formula such claim cost and utilization trend factors  as it deems necessary in its discretion so long as the rates produced are  self-supporting and the formulas for classes do not prejudice the interests of  persons who are eligible for hospital services under contracts with the  hospital service corporation which are not subject to experience rating.

    For experience rated groups of 50 to 99 employees or members, the commissioner will have the authority to determine that rates charged depart from community rates in such a way as to assure continuity of rating principles  with the community rated and experience rated groups of 100 or more.

     L.1970, c. 111, s. 1, eff. June 26, 1970.  Amended by L.1978, c. 94, s. 2, eff. Aug. 2, 1978.