SENATE DOCKET, NO. 1951        FILED ON: 1/20/2023

SENATE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 614

The Commonwealth of Massachusetts

_________________

PRESENTED BY:

John J. Cronin

_________________

To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:

The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:

An Act reining in premiums through stronger rate review.

_______________

PETITION OF:

SENATE DOCKET, NO. 1951        FILED ON: 1/20/2023

SENATE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 614

The Commonwealth of Massachusetts

_______________

In the One Hundred and Ninety-Third General Court
(2023-2024)

_______________

An Act reining in premiums through stronger rate review.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
 

SECTION 1. Section 6 of chapter 176J of the General Laws, as so appearing, is hereby amended by striking subsection (c) and inserting in place thereof the following subsection:-

(c) Notwithstanding any general or special law to the contrary, carriers offering small group health insurance plans, including carriers licensed under chapters 175, 176A, 176B or 176G, shall file small group product base rates and any changes to small group rating factors that are to be effective on January 1 of each year, on or before July 1 of the preceding year. The commissioner shall approve, modify or disapprove any proposed changes to base rates; provided, however, that the commissioner shall only modify or disapprove any proposed changes to base rates that are excessive, inadequate or unreasonable in relation to the benefits charged. The commissioner shall disapprove any change to small group rating factors that is discriminatory or not actuarially sound. Rates of reimbursement or rating factors included in the rate filing materials submitted for review by the division shall be deemed confidential and exempt from the definition of public records in clause Twenty-sixth of section 7 of chapter 4.

The commissioner, in consultation with the health policy commission and the center for health information and analysis, shall further consider whether the health insurance plans subject to the proposed rate change are affordable and whether the carrier has implemented effective strategies to enhance the affordability of its plans. To assess affordability, the commissioner may consider the following factors:

(1) implementation of strategies by the carrier to enhance the affordability of its products, including: (i) whether the carrier offers products that address the underlying cost of health care by creating appropriate incentives for consumers, employers, providers and the carrier itself that promote a focus on primary care, prevention and wellness, active management procedures for the chronically ill population, use of appropriate cost-efficient settings and use of evidence based, quality care; (ii) whether the carrier offers a spectrum of product choices to meet consumer needs; and (iii) whether the carrier employs delivery system reform and payment reform strategies to enhance cost effective utilization of appropriate services;

(2) rate change history over the prior three years for the population affected by the proposed rate change;

(3) the hardship on members affected by the proposed rate change and the ability of lower-income individuals to pay for health insurance, including how the proposed rate changes compare to changes in median household income and whether the proposed changes would disproportionately impact people of color based on existing race, ethnicity and language data collected by the carrier;

(4) trends, including: (i) historical rates of trend for existing products; (ii) national medical and health insurance trends; (iii) regional medical and health insurance trends; and (iv) inflation indices, such as the Consumer Price Index;

(5) efforts of the carrier to maintain close control over its administrative costs;

(6) constraints on affordability efforts including: (i) state and federal requirements; (ii) costs of medical services over which plans have limited control; and (iii) health plan solvency requirements; and

(7) any other relevant affordability factor, measurement or analysis as determined by the commissioner.

Nothing in this section shall preclude the commissioner from considering any factor that, in the commissioner’s discretion, is relevant to the final determination. The commissioner shall have authority to issue regulations and bulletins to facilitate consideration of the factors in this section. Nothing in this section shall preclude the commissioner from requesting from a carrier information or data to support these factors.

The commissioner shall adopt regulations to carry out this section.