Current through Register 2024 Notice Reg. No. 52, December 27, 2024
(a) This regulation applies to all insurers
who offer Medicare Supplement Insurance, including pre-standardized Medicare
Supplement Insurance plans, standardized Medicare Supplement Insurance plans,
and Medicare SELECT plans, whether to individuals or groups.
(b) Annual premium rates and loss ratio
experience filings must be made regardless of Medicare changes, an insurer's
prior year loss ratio experience, future marketing plans, or whether new
premium rates are being requested.
(c) Insurers offering Medicare Supplement
Insurance must include the following in their annual filings with the
Commissioner of Insurance:
(1)
Premium
Rate Schedules. Submit premium rate schedules for each individual
policy or group certificate. Indicate all special rating factors used for
California, such as a zip code rating factor. Indicate whether a premium rate
change is requested and, if so, the percentage change.
(2)
Policy Forms. Submit
specimens of each individual Medicare Supplement Insurance individual policy or
group certificate and outlines of coverage for each plan, if revised, new, or
not included in a filing for a previous year.
(3)
Loss Ratio Experience
Exhibits. Provide complete loss ratio information for each Medicare
Supplement Insurance plan since the inception of that plan. For rate filings
made in anticipation of Medicare benefit changes, include at least nine months'
of loss ratio experience (unless the plan has not been marketed for at least
nine months, in which case, submit loss ratio experience information for the
period the plan was marketed). First quarter filings must include the entire
previous year's loss ratio experience. Such information for plans covering
fewer than 100 California residents may be combined if the coverages are
similar. Re-state the loss ratio information for the previous year, adjusted
for run-off accruals to date. Include the number of California residents
covered by the plan.
(4)
Projected Loss Ratio Experience. Provide projected loss ratio
experience for at least five years into the future, reflecting that projected
experience both with and without any requested premium rate increase.
(5)
NAIC Medicare Supplement
Experience Exhibit. Provide a National Association of Insurance
Commissioners (NAIC) Experience Exhibit for each individual policy form or
group certificate which covers 100 or more California residents.
(6)
Actuarial Memorandum.
Submit an actuarial memorandum for each Medicare Supplement Insurance plan in
accordance with subsection (d).
(d) Medicare Supplement Insurers must provide
an actuarial analysis for each individual plan or group certificate that covers
100 or more California residents in an actuarial memorandum. More than one
analysis can be combined in one memorandum. Once actuarial analysis may be
provided for all individual plans or groups with certificates covering fewer
than 100 California residents. Each insurer must use its own data; however,
actuarial studies from other sources may be submitted to provide additional
information regarding plan renewal assumptions.
Each actuarial analysis and memorandum must include:
(1) Historical and projected premium income,
claims, and loss ratio experience for each plan.
(2) A description of coverage, including
coverage renewability, whether marketing of the plan is continuing, the date
marketing began, and the date marketing stopped, if it has stopped.
(3) For rate increase requests, the average
current premium rate and the average premium rate for the proposed new premium
rates for California residents, compared to the insurer's average premium rates
for current and proposed new premium rates nationally.
(4) Active life reserves at the end of the
prior calendar year.
(5) Monthly
claim triangulation lag reports for California residents and nationally for the
most recent 24 months for each plan or group policy covering 300 or more
California residents. Circle or highlight the relevant data showing how the lag
reports are used in developing incurred but not reported (IBNR) claims and
claim reserves.
(6) A description
of the experience and any premium rating request, including trend for benefits
not covered by Medicare (e.g., prescription drugs).
(7) National data and rating development
presented in the same format as provided for California insureds.
(8) Cost trend assumptions.
(9) Administrative costs, including, but not
limited to, commissions, claims processing, customer services, and
taxes.
(10) A certification that
the loss ratios comply with statutory requirements for loss ratios; and, if a
premium rate increase is requested, that the loss ratios will continue to
comply with such statutory requirements if a premium rate increase is
approved.
(11) A certification that
the filed rates are reasonable in relation to benefits provided for each
individual policy form or group certificate.
(e) Completion and submission to the
Commissioner of the documents and information required in subsection (b), (c),
and (d) above, together with evidence that statutorily required minimum loss
ratios are met constitutes the minimum standards necessary for approval of a
Medicare Supplement Insurance premium rate filing.
1. New
section filed 12-11-2000; operative 1-10-2001 (Register 2000, No.
50).
Note: Authority cited: Section
10195.1(d),
Insurance Code. Reference: Section
10195.1,
Insurance Code.
