To implement guidelines for multiple year rate guarantees for health insurance.

 

FINANCIAL SERVICES COMMISSION
Office of Insurance Regulation

RULE NO: RULE TITLE
69O-149.005: Reasonableness of Benefits in Relation to Premiums
PURPOSE AND EFFECT: To implement guidelines for multiple year rate guarantees for health insurance.
SUMMARY: The rule establishes the requirements an insurer must follow if it wishes to offer multiple year rate guarantees that are not excessive, inadequate or unfairly discriminatory.
SUMMARY OF ESTIMATED REGULATORY COSTS: No Statement of Estimated Regulatory Cost was prepared.
Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.
SPECIFIC AUTHORITY: 624.308(1), 627.410(6)(b), (d), (e) FS.
LAW IMPLEMENTED: 626.9541(1), 627.410(6)(d), (e), 627.410(7), 627.411(1)(a), (e), 627.9175 FS.
IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE HELD AT THE DATE,TIME AND PLACE SHOWN BELOW(IF NOT REQUESTED, THIS HEARING WILL NOT BE HELD):
TIME AND DATE: January 18, 2007, 9:30 a.m.
PLACE: Room 142, Larson Building, 200 East Gaines Street, Tallahassee, Florida
Pursuant to the provisions of the Americans with Disabilities Act, any person requiring special accommodations to participate in this workshop/meeting is asked to advise the agency at least 5 calendar days before the workshop/meeting by contacting: Tracie Lambright, Life and Health Product Review, Office of Insurance Regulation, E-mail: [e-mail]. If you are hearing or speech impaired, please contact the agency using the Florida Relay Service, 1(800)955-8771 (TDD) or 1(800)955-8770 (Voice).
THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Tracie Lambright, Life and Health Product Review, Office of Insurance Regulation, E-mail: [e-mail].

THE FULL TEXT OF THE PROPOSED RULE IS:

69O-149.005 Reasonableness of Benefits in Relation to Premiums.

(1) through (13) No change.

(14) An insurer may issue multiple year rate guarantee or rating cap provisions subject to the following:

(a) The coverage is for annually rated group health insurance policies as defined in Section 627.410(6), F.S., and Rule 69O-149.002(6)(a), F.A.C.;

(b) The provision may not apply for greater than 24 months;

(c) The rate for the entire rating period is actuarially sound, includes claim costs projected at the trend level applicable to all other groups covered under the form and is reasonably anticipated to meet the target loss ratio for the group, based on the rating manual, over the rating period;

(d) The provision is available to all groups with coverage under the form; and

(e) The provision may be available only when the insurer has group experience and the provision is used within the insurer’s experience rating formula.

 

Specific Authority 624.308(1), 627.410(6)(b), (d), (e) FS. Law Implemented 626.9541(1), 627.410(6)(d), (e), 627.410(7), 627.411(1)(a), (e), 627.9175 FS. History–New 7-1-85, Formerly 4-58.05, 4-58.005, Amended 4-18-94, 11-20-02, Formerly 4-149.005, Amended 5-18-04, Amended _________________.

NAME OF PERSON ORIGINATING PROPOSED RULE: Monica Rutkowski, Life and Health Product Review, Office of Insurance Regulation.
NAME OF SUPERVISOR OR PERSON WHO APPROVED THE PROPOSED RULE: Richard Robleto, Deputy Commissioner, Office of Insurance Regulation.
DATE PROPOSED RULE APPROVED BY AGENCY HEAD: November 6, 2006.
DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAW: August 11, 2006.