Code of Vermont Rules › Agency 21 - DEPARTMENT OF FINANCIAL REGULATION › Sub-Agency 020 - INSURANCE DIVISION › Chapter 034 - REGULATION 93-5; MINIMUM REQUIREMENTS FOR COMPLIANCE WITH TITLE 8 V.S.A.,section 4080b › Section 21 020 034 - REGULATION 93-5; MINIMUM REQUIREMENTS FOR COMPLIANCE WITH TITLE 8 V.S.A.,section 4080b

Current
				through June, 2024
Section
				1 Purpose
The purpose of this regulation is to set forth rules for the
				  enrollment of registered non-group carriers, requirements for the sale of
				  individual insurance, requirements for the filing of rates, and standards and
				  the process for approval of common health care plans.
Section 2 Authority
This regulation is issued pursuant to the authority vested in
				  the Commissioner of Banking, Insurance and Securities ("Commissioner") by Title
				  8 V.S.A., Sections 75,
				  4071,
				  and
				  4080b(c).
Section 3 Applicability and Scope
This regulation applies to any person who issues a non-group
				  plan. A non-group plan includes a health insurance policy, a nonprofit hospital
				  or medical service contract or a health maintenance organization health benefit
				  plan offered or issued to an individual. The term does not include disability
				  insurance policies, long-term care insurance policies, Medicare supplement
				  insurance policies, civilian health and medical program of the uniformed
				  services supplement policies, accident indemnity or expense policies, student
				  or athletic expense or indemnity policies or dental policies. The term also
				  does not include hospital indemnity policies or specified disease policies,
				  provided such policies are sold only as supplemental coverage when a common
				  health care plan or other comprehensive health care policy is in effect.
This regulation applies to any contract issued to or renewed
				  by a Vermont resident.
Section
				4 Definitions
A. "Community
				rating" means a rating process that produces average rates for a defined
				community of insureds in the state of Vermont for the given policy period. The
				averaging process includes various geographic rating areas, if any, within
				Vermont, ages and genders of the Vermont insureds, industrial classifications
				within Vermont, if any, Vermont claims experience and duration of coverage.
				Different community rates are appropriate for the different insurance models
				which may be represented by indemnity coverage, indemnity coverage with managed
				care, preferred provider organizations and any other health insurance models
				approved by the Commissioner.
B.
				"Credibility" means a measure of the degree of statistical significance that
				can be assigned to the claims experience of a plan when it is used as a basis
				for projecting a future rate.
C.
				"Demographic rating" means a rating process that adjusts the community rate for
				a specific plan, based on that plan's deviation from the average age and gender
				in the community rate.
D.
				"Department" means the Department of Banking, Insurance and
				Securities.
E. "Deviation plan"
				means a plan, subject to the Commissioner's approval, which describes how the
				premium shall deviate from a filed community rate as provided in Title
				8 V.S.A. §
											4080b(h)(2).
F. "Durational rating" means a rating process
				that adjusts the community rate for a specific non-group, based on the
				individual's deviation from the average claims experience assumed in the
				community rate due to the period of time the policy has been in
				force.
G. "Experience rating" means
				a rating process that adjusts the community rate for a specific plan issued to
				an individual or group of individuals. The experience rating plan changes the
				individual's premium or rates based upon a deviation of the individual's or
				group of individuals' claims experience from an average claims
				experience.
H. "Geographic area
				rating" means a rating process that adjusts the community rate for a specific
				plan based on the deviation of the claims experience in the area where the
				insured person lives from the average claims experience in the community
				rate.
I. "Health insurance trend
				factor" means a projection factor that is an estimate of the unit cost
				increases and utilization increases that are expected to be incurred in a
				health benefits plan. The estimate of unit cost increases and utilization
				increases may include consideration of erosion of deductibles, medical
				technology, general inflation and cost shifting.
J. "Industry rating" means a rating process
				that adjusts the community rate for a specific plan, based upon the deviation
				of the experience of the industrial classification of the insured from the
				average experience in the community rate.
K. "Non-group plan" or "plan" has the same
				meaning as found in Title
				8 V.S.A., Section
				4080b(a)(2). The term
				"non-group plan" also includes any exempt plans listed in Section 4080b(a)(2),
				if coverage enhancements to those exempt plans make them substantially similar
				to any approved non-group plan.
L.
				"Pre-existing condition" means the existence of symptoms which would cause an
				ordinary, prudent person to seek diagnosis, care or treatment or those
				conditions for which medical advice or treatment was recommended by or received
				from a physician or other medical professional during the 12-month period
				preceding the effective date of coverage.
M. "Tier rating" means a rating process that
				assigns rates of a set of plans to one of a series of rating tiers, based upon
				claims experience of the set of plans, or based upon one or a combination of
				demographic, industry, and geographic rating factors.
N. "Rating manual rule" includes, but is not
				limited to, any procedures, manuals, rules, or rating plans used to develop a
				premium from a filed community rate.
O. "Registered non-group carrier" ("carrier")
				means any person, except an insurance agent, broker, appraiser, or adjuster,
				who issues a non-group plan and who is registered and approved as such by the
				Commissioner.
P. "Resident" means a
				person as defined in Title
				18 V.S.A., Section
				9402(8). A resident also
				includes a dependent as defined in Title 8 V.S.A., Section 4090 and a dependent
				child attending school outside Vermont.