Connecticut Administrative Code › Title 38a - Insurance Department › 474 - Submission and Review of Rates for Medicare Supplement Insurance › Section 38a-474-2 - Rate submission requirements

Current through July 10, 2024
(a) Each insurer
			 shall submit the rates on every Medicare supplement policy form for initial
			 approval by the Commissioner and annually thereafter.
(b) An insurer seeking to change rates on a
			 Medicare supplement policy form shall submit the revised rates to the insurance
			 department at least sixty days prior to the proposed effective date of the
			 change. The department shall review the revised rates and, with respect to any
			 request for an increase in rates, shall hold a public hearing on such request
			 in accordance with the department's rules of practice. The commissioner shall
			 approve or deny any request for a change in rates on a Medicare supplement
			 policy form within forty-five days of its receipt.
(c) Where an insurer does not seek to change
			 rates for a policy form, the insurer shall submit the previously approved rates
			 at least forty-five days before the expiration of twelve months from the
			 effective date of those rates. The commissioner shall either approve the
			 continued use of such rates or notify the insurer that premium adjustments are
			 necessary to achieve the appropriate loss ratio. If the insurer fails to make
			 premium adjustments acceptable to the commissioner, the commissioner shall
			 order premium adjustments, refunds or premium credits necessary to achieve the
			 appropriate loss ratio.
(d) All
			 submission of rates for Medicare supplement policy forms shall be made in
			 duplicate, accompanied by a postage paid return envelope of sufficient size to
			 accommodate the filing. An Actuarial Memorandum describing the basis on which
			 rates were determined shall accompany the submission and shall include the
			 following items:
(1) The policy form number
			 for which rates are being submitted.
(2) A cover letter that includes a
			 description of the form in sufficient detail to accurately illustrate its
			 benefits and terms.
(3) The method
			 of marketing used. A statement that the policy form is actively offered for
			 sale. If a policy has been discontinued, the date when sales ceased shall be
			 stated.
(4) The rates appropriate
			 for the state, including all modal factors. The assumed period for which the
			 rates are to be effective should be stated.
(5) The explicit assumptions and factors used
			 in calculating the community rate. These shall include, but are not limited to,
			 any loads for the guaranteed issue requirement, the required offering to the
			 disabled or the automatic crossover system (piggybacking). Experience rating by
			 case is not allowed for group policies.
(6) A statement of the anticipated loss ratio
			 over the total lifetime of the policy. A demonstration that the minimum loss
			 ratio requirements of 65% for individual policies and 75% for group policies
			 will be met. Such demonstration shall exclude active life reserves.
(7) The expected future loss ratio projected
			 through the period for which the rates will be effective. An expected
			 third-year loss ratio which is greater than or equal to the applicable loss
			 ratio standard shall be demonstrated for policies or certificates in force less
			 than three years.
(8) A statement
			 signed by a member of the American Academy of Actuaries or another individual
			 acceptable to the commissioner, certifying that: the loss ratios are in
			 compliance with section
			 38a-495(b)
			 or section
			 38a-522(b)
			 of the general statutes, or section
			 38a-495a-10
			 of the regulations of state agencies, as appropriate; the calculations were
			 made in accordance with actuarial standards of practice; the premiums are
			 neither excessive nor inadequate; and the premiums are reasonable in relation
			 to benefits. The address and phone number of the actuary should be stated on
			 the certification.
(9) A
			 demonstration that the rates do not incorporate factors for expenses which
			 exceed one hundred fifty per cent of the average expense ratio for the entire
			 written premium for all of the insurer's lines of health insurance for the
			 previous calendar year in accordance with section
			 38a-473
			 of the general statutes. The average expense factor shall be calculated from
			 Schedule H (Accident and Health Exhibit) of the prior year's annual financial
			 statement, as the ratio of A to B where:
A is equal to the Total General Insurance Expenses (excluding
				taxes, licenses and fees), and
B is equal to the Total Premiums Written.
(10) If the insurer currently sells Medicare
			 supplement policies in this state, a demonstration that the insurer makes at
			 least standardized Plan A available to persons eligible for Medicare by reason
			 of disability. For group filings, a description of the eligibility requirements
			 of the group that includes at a minimum identification of the policyholder,
			 requirements for membership and the purpose of the group.
(11) For forms where underwriting is
			 permitted, a general statement of underwriting limitations.
(12) A table showing amounts proposed to be
			 charged to consumers if the rates are approved as submitted.
(13) Such additional information as the
			 commissioner may deem necessary for an adequate review of the proposed
			 rates.