Budget Amendment ID: FY2012-S3-225-R1

Redraft ECO 225

Actuarial Soundness of Rates

Mr. Petruccelli moved that the proposed new text be amended by inserting, after Section , the following new Section:-

“SECTION     .  Section 6 of Chapter 176J, as amended by Section 29 of Chapter 288 of the Acts of 2010 is hereby amended by striking subsection (c) in its entirety and replacing it with the following:-

(c) Notwithstanding any general or special law to the contrary, the commissioner may require carriers offering small group health insurance plans, including carriers licensed under chapters 175, 176A, 176B or 176G, to file all changes to small group product base rates and to small group rating factors at least 90 days before their proposed effective date. The commissioner shall 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. The determination of the commissioner shall be supported by sound actuarial assumptions and methods, which shall be provided in writing to the carrier. 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 shall adopt regulations to carry out this section.

Section 6 of Chapter 176J, as amended by Section 29 of Chapter 288 of the Acts of 2010 is further amended by striking subsection (f) in its entirety and replacing it with the following:-

(f) If the commissioner disapproves the rate submitted by a carrier the commissioner shall notify the carrier in writing no later than 60 days prior to the proposed effective date of the carrier’s rate.  If the carrier’s proposed based rate has been disapproved, the carrier may submit a request for hearing with the division of insurance within 10 days of such notice of disapproval. The division must schedule a hearing within 10 days of receipt. The commissioner shall issue a written decision within 30 days after the conclusion of the hearing.”