Amendment
Bill No. HB 7151
Amendment No. 850091
CHAMBER ACTION
Senate House
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1Representative Troutman offered the following:
2
3     Amendment (with title amendment)
4     Between lines 86 and 87, insert:
5     Section 2.  Paragraph (b) of subsection (6) of section
6627.6699, Florida Statutes, is amended to read:
7     627.6699  Employee Health Care Access Act.--
8     (6)  RESTRICTIONS RELATING TO PREMIUM RATES.--
9     (b)  For all small employer health benefit plans that are
10subject to this section and are issued by small employer
11carriers on or after January 1, 1994, premium rates for health
12benefit plans subject to this section are subject to the
13following:
14     1.  Small employer carriers must use a modified community
15rating methodology in which the premium for each small employer
16must be determined solely on the basis of the eligible
17employee's and eligible dependent's gender, age, family
18composition, tobacco use, or geographic area as determined under
19paragraph (5)(j) and in which the premium may be adjusted as
20permitted by this paragraph.
21     2.  Rating factors related to age, gender, family
22composition, tobacco use, or geographic location may be
23developed by each carrier to reflect the carrier's experience.
24The factors used by carriers are subject to office review and
25approval.
26     3.  Small employer carriers may not modify the rate for a
27small employer for 12 months from the initial issue date or
28renewal date, unless the composition of the group changes or
29benefits are changed. However, a small employer carrier may
30modify the rate one time prior to 12 months after the initial
31issue date for a small employer who enrolls under a previously
32issued group policy that has a common anniversary date for all
33employers covered under the policy if:
34     a.  The carrier discloses to the employer in a clear and
35conspicuous manner the date of the first renewal and the fact
36that the premium may increase on or after that date.
37     b.  The insurer demonstrates to the office that
38efficiencies in administration are achieved and reflected in the
39rates charged to small employers covered under the policy.
40     4.  A carrier may issue a group health insurance policy to
41a small employer health alliance or other group association with
42rates that reflect a premium credit for expense savings
43attributable to administrative activities being performed by the
44alliance or group association if such expense savings are
45specifically documented in the insurer's rate filing and are
46approved by the office. Any such credit may not be based on
47different morbidity assumptions or on any other factor related
48to the health status or claims experience of any person covered
49under the policy. Nothing in this subparagraph exempts an
50alliance or group association from licensure for any activities
51that require licensure under the insurance code. A carrier
52issuing a group health insurance policy to a small employer
53health alliance or other group association shall allow any
54properly licensed and appointed agent of that carrier to market
55and sell the small employer health alliance or other group
56association policy. Such agent shall be paid the usual and
57customary commission paid to any agent selling the policy.
58     5.  Any adjustments in rates for claims experience, health
59status, or duration of coverage may not be charged to individual
60employees or dependents. For a small employer's policy, such
61adjustments may not result in a rate for the small employer
62which deviates more than 15 percent from the carrier's approved
63rate. Any such adjustment must be applied uniformly to the rates
64charged for all employees and dependents of the small employer.
65A small employer carrier may make an adjustment to a small
66employer's renewal premium, not to exceed 10 percent annually,
67due to the claims experience, health status, or duration of
68coverage of the employees or dependents of the small employer.
69Semiannually, small group carriers shall report information on
70forms adopted by rule by the commission, to enable the office to
71monitor the relationship of aggregate adjusted premiums actually
72charged policyholders by each carrier to the premiums that would
73have been charged by application of the carrier's approved
74modified community rates. If the aggregate resulting from the
75application of such adjustment exceeds the premium that would
76have been charged by application of the approved modified
77community rate by 4 percent for the current reporting period,
78the carrier shall limit the application of such adjustments only
79to minus adjustments beginning not more than 60 days after the
80report is sent to the office. For any subsequent reporting
81period, if the total aggregate adjusted premium actually charged
82does not exceed the premium that would have been charged by
83application of the approved modified community rate by 4
84percent, the carrier may apply both plus and minus adjustments.
85A small employer carrier may provide a credit to a small
86employer's premium based on administrative and acquisition
87expense differences resulting from the size of the group. Group
88size administrative and acquisition expense factors may be
89developed by each carrier to reflect the carrier's experience
90and are subject to office review and approval. For the sole
91purpose of determining the appropriate rate adjustment due to
92health status for initial coverage of a small employer, a
93carrier may utilize application forms to be completed by
94employers that require health or experience information and
95applications to be completed by employees that require health or
96experience information, and a carrier may vary the use of the
97application forms depending upon the number of the small
98employer's eligible employees applying for coverage. The
99application methodology must be applied uniformly per carrier
100among all the small employer groups having the same number of
101eligible employees applying for coverage.
102     6.  A small employer carrier rating methodology may include
103separate rating categories for one dependent child, for two
104dependent children, and for three or more dependent children for
105family coverage of employees having a spouse and dependent
106children or employees having dependent children only. A small
107employer carrier may have fewer, but not greater, numbers of
108categories for dependent children than those specified in this
109subparagraph.
110     7.  Small employer carriers may not use a composite rating
111methodology to rate a small employer with fewer than 10
112employees. For the purposes of this subparagraph, a "composite
113rating methodology" means a rating methodology that averages the
114impact of the rating factors for age and gender in the premiums
115charged to all of the employees of a small employer.
116     8.a.  A carrier may separate the experience of small
117employer groups with less than 2 eligible employees from the
118experience of small employer groups with 2-50 eligible employees
119for purposes of determining an alternative modified community
120rating.
121     b.  If a carrier separates the experience of small employer
122groups as provided in sub-subparagraph a., the rate to be
123charged to small employer groups of less than 2 eligible
124employees may not exceed 150 percent of the rate determined for
125small employer groups of 2-50 eligible employees. However, the
126carrier may charge excess losses of the experience pool
127consisting of small employer groups with less than 2 eligible
128employees to the experience pool consisting of small employer
129groups with 2-50 eligible employees so that all losses are
130allocated and the 150-percent rate limit on the experience pool
131consisting of small employer groups with less than 2 eligible
132employees is maintained. Notwithstanding s. 627.411(1), the rate
133to be charged to a small employer group of fewer than 2 eligible
134employees, insured as of July 1, 2002, may be up to 125 percent
135of the rate determined for small employer groups of 2-50
136eligible employees for the first annual renewal and 150 percent
137for subsequent annual renewals.
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T I T L E  A M E N D M E N T
141     Remove line 17 and insert:
142for the repayment of such advances; authorizing a carrier to
143utilize application forms for the purpose of determining the
144appropriate rate adjustment due to health status for initial
145coverage of a small employer; providing application methodology;  
146amending s. 627.6699, F.S.; providing an effective


CODING: Words stricken are deletions; words underlined are additions.