Current through Register Vol. 24-06, March 15, 2024
(1) An issuer may
not deliver or issue for delivery a policy or certificate to a resident of this
state unless the policy form or certificate form has been filed with and
approved by the commissioner according to the filing requirements and
procedures prescribed by the commissioner.
(2) An issuer may not use or change premium
rates for a medicare supplement policy or certificate unless the rates, rating
schedule, and supporting documentation have been filed with and approved by the
commissioner according to the filing requirements and procedures prescribed by
the commissioner.
(3)
(a) Except as provided in (b) of this
subsection, an issuer may not file for approval more than one form of a policy
or certificate of each type for each standard medicare supplement benefit
plan.
(b) An issuer may offer, with
the approval of the commissioner, up to four additional policy forms or
certificate forms of the same type for the same standard medicare supplement
benefit plan, one for each of the following cases:
(i) The inclusion of new or innovative
benefits;
(ii) The addition of
either direct response or insurance producer marketing methods;
(iii) The addition of either guaranteed issue
or underwritten coverage;
(iv) The
offering of coverage to individuals eligible for medicare by reason of
disability. The form number for products offered to enrollees who are eligible
by reason of disability must be distinct from the form number used for a
corresponding standardized plan offered to an enrollee eligible for medicare by
reason of age.
(c) For
the purposes of this section, a "type" means an individual policy, a group
policy, an individual medicare SELECT policy, or a group medicare SELECT
policy.
(4)
(a) Except as provided in (a)(i) of this
subsection, an issuer must continue to make available for purchase any policy
form or certificate form issued after the effective date of this regulation
that has been approved by the commissioner. A policy form or certificate form
is not considered to be available for purchase unless the issuer has actively
offered it for sale in the previous twelve months.
(i) An issuer may discontinue the
availability of a policy form or certificate form if the issuer provides to the
commissioner in writing its decision at least thirty days before discontinuing
the availability of the form of the policy or certificate. After receipt of the
notice by the commissioner, the issuer may no longer offer for sale the policy
form or certificate form in this state.
(ii) An issuer that discontinues the
availability of a policy form or certificate form under (a)(i) of this
subsection, may not file for approval a new policy form or certificate form of
the same type for the same standard medicare supplement benefit plan as the
discontinued form for a period of five years after the issuer provides notice
to the commissioner of the discontinuance. The period of discontinuance may be
reduced if the commissioner determines that a shorter period is
appropriate.
(b) The
sale or other transfer of medicare supplement business to another issuer is
considered a discontinuance for the purposes of this subsection.
(c) A change in the rating structure or
methodology is considered a discontinuance under (a) of this subsection, unless
the issuer complies with the following requirements:
(i) The issuer provides an actuarial
memorandum, in a form and manner prescribed by the commissioner, describing the
manner in that the revised rating methodology and resultant rates differ from
the existing rating methodology and resultant rates.
(ii) The issuer does not subsequently put
into effect a change of rates or rating factors that would cause the percentage
differential between the discontinued and subsequent rates as described in the
actuarial memorandum to change. The commissioner may approve a change to the
differential that is in the public interest.
(5)
(a)
Except as provided in (b) of this subsection, the experience of all policy
forms or certificate forms of the same type in a standard medicare supplement
benefit plan must be combined for purposes of the refund or credit calculation
prescribed in WAC
284-66-203.
(b) Forms assumed under an assumption
reinsurance agreement may not be combined with the experience of other forms
for purposes of the refund or credit calculation.
(6) An issuer may set rates only on a
community rated basis or on an issue-age level premium basis for policies
issued prior to January 1, 1996, and may set rates only on a community rated
basis for policies issued after December 31, 1995.
(a) For policies issued prior to January 1,
1996, community rated premiums must be equal for all individual policyholders
or certificateholders under a standardized medicare supplement benefit form.
Such premiums may not vary by age or sex. For policies issued after December
31, 1995, community rated premiums must be set according to
RCW
48.66.045(3).
(b) Issue-age level premiums must be
calculated for the lifetime of the insured. This will result in a level premium
if the effects of inflation are ignored.
(7) All filings of policy or certificate
forms must be accompanied by the proposed application form, outline of coverage
form, proposed rate schedule, and an actuarial memorandum completed, signed and
dated by a qualified actuary as defined in WAC
284-05-060. In addition to the
actuarial memorandum, the following supporting documentation must be submitted
to demonstrate to the satisfaction of the commissioner that rates are not
excessive, inadequate, or unfairly discriminatory and otherwise comply with the
requirements of this chapter:
(a) Anticipated
loss ratios stated on a calendar year basis by duration for the period for
which the policy is rated. Filings of future rate adjustments must contain the
actual calendar year loss ratios experienced since inception, both before and
after the refund required, if any and the actual loss ratios in comparison to
the expected loss ratios stated in the initial rate filing on a calendar year
basis by duration if applicable;
(b) Anticipated total termination rates on a
calendar year basis by duration for the period for which the policy is rated.
The termination rates should be stated as a percentage and the source of the
mortality assumption must be specified. Filings of future rate adjustments must
include the actual total termination rates stated on a calendar year basis
since inception;
(c) Expense
assumptions including fixed and percentage expenses for acquisition and
maintenance costs;
(d) Schedule of
total compensation payable to insurance producers and other producers as a
percentage of premium, if any;
(e)
A complete specimen copy of the compensation agreements or contracts between
the issuer and its insurance producers, as well as the contracts between any
insurance producers or others whose compensation is based in whole or in part
on the sale of medicare supplement insurance policies. The agreements must
demonstrate compliance with WAC
284-66-350 (where
appropriate);
(f) Other data
necessary in the reasonable opinion of the commissioner to substantiate the
filing.
Statutory Authority:
RCW
48.02.060(3)(a) and
48.17.010(5).
11-01-159 (Matter No. R 2010-09), §
284-66-243, filed 12/22/10,
effective 1/22/11. Statutory Authority:
RCW
48.66.030(3)(a),
48.66.041, and
48.66.165. 09-24-052 (Matter No. R
2009-08), §
284-66-243, filed 11/24/09,
effective 1/19/10. Statutory Authority:
RCW
48.02.060 and
48.66.165. 05-17-019 (Matter No. R
2004-08), §
284-66-243, filed 8/4/05,
effective 9/4/05. Statutory Authority:
RCW
48.02.060,
48.20.450,
48.20.460,
48.20.470,
48.30.010,
48.44.020,
48.44.050,
48.44.070,
48.46.030,
48.46.130 and
48.46.200. 92-06-021 (Order R
92-1), §
284-66-243, filed 2/25/92,
effective 3/27/92.