Code of Massachusetts Regulations › 211 CMR - DIVISION OF INSURANCE › Title 211 CMR 66.00 - Small Group Health Insurance › Section 66.07 - Restrictions Relating to Premium Rates

Current through Register 1525, July 5, 2024
Premiums charged to Eligible Small Groups and Eligible
				Individuals shall be based on the collective experience of the covered small
				groups and individuals. Premiums charged to every Eligible Small Business or
				Eligible Individual for a Health Benefit Plan, whether through a trust or
				association or through an Intermediary or Group Purchasing Cooperative, or
				through the Connector, or directly, also must satisfy the following
				requirements:
(1)
Premium
			 Calculations
.
(a) In calculating
			 the premium to be charged to each Eligible Small Group or Eligible Individual,
			 a Carrier shall develop a Group Base Premium Rate and may develop and use one
			 or more of the Rating Adjustment Factors, provided that such Rating Adjustment
			 Factors are used in connection with all products offered to Eligible Small
			 Groups and Eligible Individuals.
(b) In calculating the premium to be charged
			 to each Eligible Small Group or Eligible Individual, a Carrier shall develop a
			 Group Base Premium Rate and may develop and use only the Rating Adjustment
			 Factors set forth in
			 211
			 CMR 66.07(1)(b):
1.
Age Rating Adjustment
			 Factor
. If a Carrier applies an age Rating Adjustment Factor to
			 Eligible Individuals or Eligible Small Groups, the Carrier must apply the Age
			 Rating Adjustment Factor in accordance with both the ACA and any guidance
			 provided by the Commissioner such that the ratio of the highest factor for
			 adults older than 20 years of age compared to the lowest factor for adults
			 older than 20 years of age shall not exceed a ratio of 2-to-1.
2.
Area Rating Adjustment
			 Factors
.
a. The area Rating
			 Adjustment Factor for each distinct region in
			 211
			 CMR 66.07(1)(b)2. must range
			 from not less than 0.8 to not more than 1.2.
b. The permissible regions are based on the
			 following zip code groupings which refer to the first three digits of the zip
			 code for each Eligible Small Business or Eligible Individual:
i. 010 through 013;
ii. 014 through 016;
iii. 017 and 020;
iv. 018 through 019;
v. 021 through 022 and 024;
vi. 023 and 027; and
vii. 025 through 026,
except that a Carrier may combine the zip code groupings
				outlined in
				211
				CMR 66.07(1)(b)2.b.iii. and
				iv. into one region or combine the zip code groupings outlined in
				211
				CMR 66.07(1)(b)2.b.iii.
				through v. into one region for all of its Health Benefit Plans subject to
				211 CMR
				66.00, or use regions based on groupings of counties
				that roughly approximate the zip code groupings.
c. If a Carrier chooses to establish an area
			 Rating Adjustment Factor, it must apply the Rating Adjustment Factor to every
			 Eligible Small Business and Eligible Individual within each area. The area
			 Rating Adjustment Factor for an Eligible Small Group will be based upon the
			 head office location of the Eligible Small Group and the area Rating Adjustment
			 Factor for an Eligible Individual will be based on the primary residence of the
			 Eligible Individual.
3.
Tobacco Use Rating Adjustment
			 Factor
.
a. The tobacco use Rating
			 Adjustment Factor, which may only be applied when expressly permitted by the
			 Commissioner, will consistently apply to all Eligible Individuals and Eligible
			 Small Groups.
b. Eligible
			 Individuals and Eligible Small Groups must certify, in a method approved by the
			 Commissioner, that Eligible Individuals and/or their Eligible Dependents or
			 Eligible Small Group employees and/or their Eligible Dependents have not used
			 Tobacco Products during the previous 12 months.
4.
Benefit Level Rating
			 Adjustment Factor
. If a Carrier chooses to establish a Benefit
			 Level Rating Adjustment Factor, it must apply the Rating Adjustment Factor with
			 respect to every Eligible Individual and Eligible Small Business.