| 1 | Representative 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 |
| 6 | 627.6699, 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 |
| 10 | subject to this section and are issued by small employer |
| 11 | carriers on or after January 1, 1994, premium rates for health |
| 12 | benefit plans subject to this section are subject to the |
| 13 | following: |
| 14 | 1. Small employer carriers must use a modified community |
| 15 | rating methodology in which the premium for each small employer |
| 16 | must be determined solely on the basis of the eligible |
| 17 | employee's and eligible dependent's gender, age, family |
| 18 | composition, tobacco use, or geographic area as determined under |
| 19 | paragraph (5)(j) and in which the premium may be adjusted as |
| 20 | permitted by this paragraph. |
| 21 | 2. Rating factors related to age, gender, family |
| 22 | composition, tobacco use, or geographic location may be |
| 23 | developed by each carrier to reflect the carrier's experience. |
| 24 | The factors used by carriers are subject to office review and |
| 25 | approval. |
| 26 | 3. Small employer carriers may not modify the rate for a |
| 27 | small employer for 12 months from the initial issue date or |
| 28 | renewal date, unless the composition of the group changes or |
| 29 | benefits are changed. However, a small employer carrier may |
| 30 | modify the rate one time prior to 12 months after the initial |
| 31 | issue date for a small employer who enrolls under a previously |
| 32 | issued group policy that has a common anniversary date for all |
| 33 | employers covered under the policy if: |
| 34 | a. The carrier discloses to the employer in a clear and |
| 35 | conspicuous manner the date of the first renewal and the fact |
| 36 | that the premium may increase on or after that date. |
| 37 | b. The insurer demonstrates to the office that |
| 38 | efficiencies in administration are achieved and reflected in the |
| 39 | rates charged to small employers covered under the policy. |
| 40 | 4. A carrier may issue a group health insurance policy to |
| 41 | a small employer health alliance or other group association with |
| 42 | rates that reflect a premium credit for expense savings |
| 43 | attributable to administrative activities being performed by the |
| 44 | alliance or group association if such expense savings are |
| 45 | specifically documented in the insurer's rate filing and are |
| 46 | approved by the office. Any such credit may not be based on |
| 47 | different morbidity assumptions or on any other factor related |
| 48 | to the health status or claims experience of any person covered |
| 49 | under the policy. Nothing in this subparagraph exempts an |
| 50 | alliance or group association from licensure for any activities |
| 51 | that require licensure under the insurance code. A carrier |
| 52 | issuing a group health insurance policy to a small employer |
| 53 | health alliance or other group association shall allow any |
| 54 | properly licensed and appointed agent of that carrier to market |
| 55 | and sell the small employer health alliance or other group |
| 56 | association policy. Such agent shall be paid the usual and |
| 57 | customary commission paid to any agent selling the policy. |
| 58 | 5. Any adjustments in rates for claims experience, health |
| 59 | status, or duration of coverage may not be charged to individual |
| 60 | employees or dependents. For a small employer's policy, such |
| 61 | adjustments may not result in a rate for the small employer |
| 62 | which deviates more than 15 percent from the carrier's approved |
| 63 | rate. Any such adjustment must be applied uniformly to the rates |
| 64 | charged for all employees and dependents of the small employer. |
| 65 | A small employer carrier may make an adjustment to a small |
| 66 | employer's renewal premium, not to exceed 10 percent annually, |
| 67 | due to the claims experience, health status, or duration of |
| 68 | coverage of the employees or dependents of the small employer. |
| 69 | Semiannually, small group carriers shall report information on |
| 70 | forms adopted by rule by the commission, to enable the office to |
| 71 | monitor the relationship of aggregate adjusted premiums actually |
| 72 | charged policyholders by each carrier to the premiums that would |
| 73 | have been charged by application of the carrier's approved |
| 74 | modified community rates. If the aggregate resulting from the |
| 75 | application of such adjustment exceeds the premium that would |
| 76 | have been charged by application of the approved modified |
| 77 | community rate by 4 percent for the current reporting period, |
| 78 | the carrier shall limit the application of such adjustments only |
| 79 | to minus adjustments beginning not more than 60 days after the |
| 80 | report is sent to the office. For any subsequent reporting |
| 81 | period, if the total aggregate adjusted premium actually charged |
| 82 | does not exceed the premium that would have been charged by |
| 83 | application of the approved modified community rate by 4 |
| 84 | percent, the carrier may apply both plus and minus adjustments. |
| 85 | A small employer carrier may provide a credit to a small |
| 86 | employer's premium based on administrative and acquisition |
| 87 | expense differences resulting from the size of the group. Group |
| 88 | size administrative and acquisition expense factors may be |
| 89 | developed by each carrier to reflect the carrier's experience |
| 90 | and are subject to office review and approval. For the sole |
| 91 | purpose of determining the appropriate rate adjustment due to |
| 92 | health status for initial coverage of a small employer, a |
| 93 | carrier may utilize application forms to be completed by |
| 94 | employers that require health or experience information and |
| 95 | applications to be completed by employees that require health or |
| 96 | experience information, and a carrier may vary the use of the |
| 97 | application forms depending upon the number of the small |
| 98 | employer's eligible employees applying for coverage. The |
| 99 | application methodology must be applied uniformly per carrier |
| 100 | among all the small employer groups having the same number of |
| 101 | eligible employees applying for coverage. |
| 102 | 6. A small employer carrier rating methodology may include |
| 103 | separate rating categories for one dependent child, for two |
| 104 | dependent children, and for three or more dependent children for |
| 105 | family coverage of employees having a spouse and dependent |
| 106 | children or employees having dependent children only. A small |
| 107 | employer carrier may have fewer, but not greater, numbers of |
| 108 | categories for dependent children than those specified in this |
| 109 | subparagraph. |
| 110 | 7. Small employer carriers may not use a composite rating |
| 111 | methodology to rate a small employer with fewer than 10 |
| 112 | employees. For the purposes of this subparagraph, a "composite |
| 113 | rating methodology" means a rating methodology that averages the |
| 114 | impact of the rating factors for age and gender in the premiums |
| 115 | charged to all of the employees of a small employer. |
| 116 | 8.a. A carrier may separate the experience of small |
| 117 | employer groups with less than 2 eligible employees from the |
| 118 | experience of small employer groups with 2-50 eligible employees |
| 119 | for purposes of determining an alternative modified community |
| 120 | rating. |
| 121 | b. If a carrier separates the experience of small employer |
| 122 | groups as provided in sub-subparagraph a., the rate to be |
| 123 | charged to small employer groups of less than 2 eligible |
| 124 | employees may not exceed 150 percent of the rate determined for |
| 125 | small employer groups of 2-50 eligible employees. However, the |
| 126 | carrier may charge excess losses of the experience pool |
| 127 | consisting of small employer groups with less than 2 eligible |
| 128 | employees to the experience pool consisting of small employer |
| 129 | groups with 2-50 eligible employees so that all losses are |
| 130 | allocated and the 150-percent rate limit on the experience pool |
| 131 | consisting of small employer groups with less than 2 eligible |
| 132 | employees is maintained. Notwithstanding s. 627.411(1), the rate |
| 133 | to be charged to a small employer group of fewer than 2 eligible |
| 134 | employees, insured as of July 1, 2002, may be up to 125 percent |
| 135 | of the rate determined for small employer groups of 2-50 |
| 136 | eligible employees for the first annual renewal and 150 percent |
| 137 | for subsequent annual renewals. |
| 138 |
|
| 139 | ----------------------------------------------------- |
| 140 | T I T L E A M E N D M E N T |
| 141 | Remove line 17 and insert: |
| 142 | for the repayment of such advances; authorizing a carrier to |
| 143 | utilize application forms for the purpose of determining the |
| 144 | appropriate rate adjustment due to health status for initial |
| 145 | coverage of a small employer; providing application methodology; |
| 146 | amending s. 627.6699, F.S.; providing an effective |