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Indiana Department of Insurance

IDOI > Company Compliance > Accident & Health  > Product Filing Information/Instructions  > 8.0 SMALL GROUP RATE REQUIREMENTS for MAJOR MEDICAL, HMO, OTHER PRODUCTS and DENTAL 8.0 SMALL GROUP RATE REQUIREMENTS for MAJOR MEDICAL, HMO, OTHER PRODUCTS and DENTAL

RATE ADJUSTMENTS for EXISTING PRODUCTS

(INCLUDING NON-EMPLOYER ASSOCIATIONS and/or TRUSTS)

The Indiana Department of Insurance (IDOI) requests data/information for the following three requirements as part of the rate review process for existing rates and/or forms, if applicable, filed: Implementation Date, Rate Review Detail and Actuarial Memorandum.

Data for requirements I and II are entered into SERFF fields.

Other Products and Dental filings only complete requirements I and III as applicable.

I. IMPLEMENTATION DATE

  1. Enter the date requested for the filing to be implemented.
    1. Date must be a minimum of 60+ days from the submission date.
    2. Date entered may not be the date the filing officially becomes effective.
      1. IDOI will determine the definitive effective date.
      2. If “Upon Approval” is chosen, the filing will not be closed until this field is revised with an actual date.
    3. If date changes during the review process, the following action is needed:
      1. Update SERFF field before the filing is completed and closed.
        1. SERFF field can be revised during a “Post Submission Update” at the time a response is provided for the objection.

II. RATE REVIEW DETAIL

Located under the Rate/Rule Schedule tab in SERFF.

Reference the SERFF Data Field Guide under section Rate Review Detail to accurately complete the specific SERFF data fields listed below for this requirement. All fields should be state specific.

  1. Complete the following data fields in the Rate Review Detail template:
    1. Company Name
    2. HHS Issuer ID
    3. Product Names
    4. Trend Factors
    5. Forms
      1. New Policy Forms (including form numbers, if applicable)
      2. Affected Forms for Closed Blocks
      3. Other Affected Forms
    6. Requested Rate Change Information
      1. Change Period
      2. Member Months
      3. Benefit Change
      4. Percent Rate Change Requested
        1. Min, Max and Weighted Average Rate Increase
    7. Prior Rate
      1. Total Earned Premium
      2. Total Incurred Claims
      3. Annual PMPM $: Min, Max and Weighted Average
    8. Requested Rate
      1. Projected Earned Premium
      2. Projected Incurred Claims
      3. Annual PMPM $: Min, Max and Weighted Average

Accurate reporting will avoid filing errors as related to submitting rate requests and for federal reporting.

III. ACTUARIAL MEMORANDUM

Provide the data listed below in the actuarial memorandum as an attachment under the Supporting Documentation tab in SERFF.

  1. Benefit Structure
    1. Provide sufficient detail for an analysis of the pricing including scope and purpose.
    2. Provide Market Impacted.
    3. Provide a copy of the policy form.
    4. Provide any changes from the most recent filing.
    5. Provide the prior SERFF tracking number.
  2. Current Rates
    1. Include a complete set of current rates.
    2. Include the following items and any other guidelines that impact policyholder’s premium payment:
      1. Modal Factors
      2. Geographic Factors
      3. Family Size
  3. Proposed Rates
    1. Include a complete set of proposed rates.
    2. Include the following items and any other guidelines that impact policyholder’s premium payment:
      1. Modal Factors
      2. Geographic Factors
      3. Family Size
  4. Projected Experience with Requested Rate Change
    (Provide best estimates for the data below.)
    1. Earned Premium with Enrollment Projections
      1. Provide the projected earned premium using realistic assumptions for the following:
        1. Next 12 months
        2. Next full calendar year
        3. Anticipated implementation date
    2. Incurred Claims
      1. Provide the anticipated projected incurred claims using realistic assumptions for the following:
        1. Next 12 months
        2. Next full calendar year
    3. Anticipated Loss Ratios
      1. Provide the anticipated loss ratios for the following:
        1. Next 12 months
        2. Next full calendar year
  5. Projected Experience without Requested Rate Change
    (Provide best estimates for the date below.)
    1. Earned Premium with Enrollment Projections
      1. Provide the projected earned premium using realistic assumptions for the following:
        1. Next 12 months
        2. Next full calendar year
        3. Anticipated implementation date
    2. Incurred Claims
      1. Provide the anticipated projected incurred claims using realistic assumptions for the following:
        1. Next 12 months
        2. Next full calendar year
    3. Anticipated Loss Ratios
      1. Provide the anticipated loss ratios for the following:
        1. Next 12 months
        2. Next full calendar year
  6. Assumptions
    1. Include the following data and a detailed description of the basis for the assumptions used in pricing: (Follow the guidelines from Actuarial Standards of Practice (ASOP) No. 8.) http://www.actuarialstandardsboard.org/pdf/asops/asop008_129.pdf
      1. Annual Overall Trend Rate
        1. Provide the annual per individual rate of medical cost increase assumed for the next year.
        2. Provide the annual per individual rate of premium increase assumed for the next year.
  7. Premium Guarantee Provision
    1. Provide a detailed description of the premium rate guarantee provision.
  8. Rating Factors
    1. Identify from the following which rate structure or any other is used for this product:
      1. Age Factors
      2. Geographic Factors
      3. Tobacco
      4. Family Composition
  9. Historical Experience
    (Indicate experience period, including last date of paid claims.)
    (Provide Indiana and Nationwide data for below.)
    1. Earned Premium
      1. Provide the historical earned premium for each calendar year from inception.
      2. Include all premium regardless of ownership of this block.
        1. Provide as much of the earned premium paid in the current year since the last calendar year as possible.
      3. Include the following items and any other changes that impact policyholder’s premium payment:
        1. Fees
        2. Taxes
        3. Modal loading
    2. Incurred Losses
      (Losses should exclude ALR, exclude LAE, show detail of IBNR and indicate the paid-to-date.)
      1. Provide the historical incurred losses for each calendar year from inception.
      2. Include all ownership regardless of ownership of this block.
        1. Provide as much of the earned premium paid in the current year since the last calendar year as possible.
    3. Rate Change History
      (Provide Indiana and Nationwide data for below.)
      1. Provide a three year rate increase history that includes the following:
        1. Show the rate increase percent with a month/year effective date.
        2. Label clearly.
    4. Rate Change Indicated
      (Provide Indiana and Nationwide data for below.)
      1. Provide the rate change indicated to achieve the original target loss ratio.
      2. Label clearly.
    5. Rate Change Requested
      (Provide Indiana and Nationwide data for below.)
      1. Provide the rate change requested.
      2. Provide the desired effective dates.
      3. Label clearly.


  10. Projection of Lifetime Target Loss Ratio
    1. Provide Historical Experience for the following:
      1. Discounted earned premium and incurred losses using original filed interest rate.
    2. Provide Projected Future Experience for the following:
      1. Show projected incurred premium and incurred losses.
      2. Discount at original filed interest rate.
      3. Assume requested rate increase.
      4. Assume no rate increase.
    3. Provide Discounted Lifetime Experience for the following:
      1. Assume requested rate increase.
      2. Assume no rate increase.

Attestations

  1. Small Group Attestation
    1. Provide an attestation along with documentation confirming the following:
      1. Review of Indiana’s small group health law. (Ind. Code §27-8-15)
      2. Compliance with Indiana’s small group health law. (Ind. Code §27-8-15)
      3. Intent to file annual actuarial certification. (Ind. Code §27-8-15)
  2. Actuarial Certification/Rate Attestation
    1. Provide an actuarial certification with a clear statement attesting to the following:
      1. Compliance with all applicable state and federal statutes and regulations.
      2. Compliance with actuarial standards of practice (ASOP).

Rate Filing Submittal Guidelines

The following provides additional information to properly submit rate filings:

  • Unless filing approved, do not implement a rate increase as related to manual rates.
  • Unless file approved, do not implement a rate increase as related to trend beyond the implementation date.
  • File proper TOI and Sub-TOI for rate request.