sem hlt 12122007

New York State Department of InsuranceHealth Bureau: 

New York State Department of Insurance Health Bureau Filing Compliance Seminar December 12, 2007

Overview: 

Overview Morning: Introduction to the Bureau Trends Hot Topics General Information About Filings Lunch – 1 hour Afternoon: Review Process Tips for Success Questions/Suggestions Closing

Introduction to the Bureau: 

Introduction to the Bureau Legal Section Forms Units – Article 43/HMO Group Commercial Individual Commercial Elder Care Rating Section Examiners

Bureau Responsibilities: 

Bureau Responsibilities Form and rate review; File and use rate adjustments; Company examinations; Legislation, regulations and circular letters; Financial aspects of accident and health insurance companies; Annual filings (LTC rescission reports, experience monitoring reports, etc.); Inquiries – consumer, legislature, NAIC, other states, companies, etc.;

Bureau Responsibilities, cont’d: 

Bureau Responsibilities, cont’d Freedom of Information Law requests; Regulation 146 risk pools; Discontinuations, withdrawals, mergers; Interagency activities; External Appeal Program; Healthy NY Program; Website maintenance and updates; Review of utilization review reports; and more

Variety of Companies: 

Variety of Companies Non Profits - Article 43; HMOs; Accident and Health; Life; Property/Casualty; Fraternal Benefit Societies; Municipal Co-ops; CCRCs

Variety of Health Products: 

Variety of Health Products Accident Long Term Care-Partnership Basic Hospital Major Medical Basic Hospital & Medical Managed Long Term Care Basic Medical Medicare Select Cap Provider Excess Loss Medicare Supplement Healthy New York Nursing Home only CCRC Nursing Home and Home Care Child Health Plus POS Comprehensive HMO PPO/EPO DBL Prescription Drug Dental Provider Excess Disability Income Retiree Benefits HSA/High Deductible Specified Disease Home Care only Statutory Conversion Hospital Indemnity Stop Loss Long Term Care Vision

Slide9: 

Submissions by Product Type

Slide10: 

2006 Submissions Rate Only Form & Rate Form Only

Slide12: 

SERFF Paper

Submissions: 

Submissions For 2005 and 2006, the Health Bureau averaged more than 2,200 submissions a year. For the same period, the number of forms received averaged more than 6,700 a year.

Slide14: 

At least one objection letter 49.8% 50.2% Submissions and Comment Letters

Speed to Market Submissions: 

Speed to Market Submissions Certification by Checklist Certification by Previously Approved Form Certification by Template Section 3201(b)(6) Deemer Speed to Market filings comprised only 13% and 10% of the filings for 2005 and 2006, respectively.

Slide16: 

At least one objection letter 70% Submissions and Comment Letters

Slide17: 

Speed to Market Filings Ultimately approved but had at least one comment letter Closed or Rejected Other – including approved and withdrawn

RAFFT: 

RAFFT Rate and Form Filing Taskforce Purpose Members

Hot Topics: 

Hot Topics Timothy’s Law – mental health parity Managed Care Law Elder care issues – premium rate increases, marketing fraud and abuse, etc. Benesowitz – disability pre-existing conditions Discretionary Clauses

General Information About Filings: 

General Information About Filings

Insurance Department Website: 

Insurance Department Website www.ins.state.ny.us

Speed to Market Initiatives: 

Speed to Market Initiatives Deemer - §3201(b)(6); 3 Strike Rule, Incomplete Submissions, Incomprehensible Submissions Circular Letter No. 14 (1997); 15-day response Circular Letter No. 18 (1999); Certifications Circular Letter No. 4 (2003); Checklists; SERFF & Priority of Review Circular Letter No. 9 (2004); RAFFT

Priority of Review: 

Priority of Review Circular Letter No. 9 (2004) Paper vs SERFF – priority of SERFF SERFF speed to market certification Paper speed to market certification SERFF traditional Paper traditional

Methods of Review: 

Methods of Review Normal prior approval of forms and/or rates. Speed to Market – Circular Letter No. 4 (2003). Certifications by checklist, template, or previously approved form. Deemer - §3201(b)(6) – applicable to form and form & rate filings only. Filed for Reference (advertising - 52.22(b)(9), out of state filings -§3201(b)(2), variable material – 52.31(l), prefilings – 52.32, etc.). File and Use Rate Adjustment - §§3231(e)(2) or 4308(g).

SERFF: 

SERFF Choose a Type of Insurance (TOI), sub-TOI, and filing type (method of review). Submission Requirements Satisfy with attachments – include blank templates; or Bypass with explanation Schedule Tabs (General Info, Form, Rate, Supporting Documentation, and Contact).

Paper: 

Paper Cover letter – 52.33. Use of Checklist recommended. Forms – 52.31. Send all submissions involving forms to the Albany office Rates – 52.40.

Rate Filing Review: Albany vs NYC Office: 

Rate Filing Review: Albany vs NYC Office NYC Office §4308(g) Rate Applications; §4308(h) Loss Ratio Reports; Experience Rating Formula for HMO Based POS Product; Child Health Plus Renewal Rates.

Rate Filing Review: Albany vs NYC Office, cont.: 

Rate Filing Review: Albany vs NYC Office, cont. Albany Office Rates for New Contracts, Riders or Amendments (to be submitted with forms); Rate Changes to Existing Products for Commercial Insurers; Any Other Changes to Rate or Underwriting Manuals; §3231(e)(2)(A) Rate Applications; §3231(e)(2)(B) Loss Ratio Reports; Experience Rating Formula for Products Other Than HMO Based POS; Child Health Plus Initial Rates; Annual Filing of DBL Reports; Annual Filing of Experience Data.

Preparing to File: 

Preparing to File Getting Things Ready

Sources of Authority: 

Sources of Authority Statutes – Legislative (NY Insurance Law) Regulations – Department (11 NYCRR) Circular Letters – Department guidance Opinions of Counsel – Department interpretations of statutes and regulations Court decisions

Forms: 

Forms Definition of policy form - §3201(a) Includes policy, contract, certificate, or evidence of insurance and any application, rider or endorsement Does not include an agreement, rider or endorsement relating only to manner of benefit payment

Other Documents Subject to Review: 

Other Documents Subject to Review Advertisements – Medicare Supplement Insurance - 52.22(b)(9) and 215 (Regulation 34) Variable Material – 52.31(l) Provider Network Information – §3201(c) Out of State Filings – §3201(b)(2) – domestic insurers only Foreign Language Translations with an attestation – §3102(b)(3)

Permissible Groups: 

Permissible Groups §4235(c)(1)(A) – (N) (M) groups – discretionary group status Requires actual proof of fulfillment of statutory language, not just a reiteration of the language (include written description with submission) Failure to meet a requirement of a permissible group is not a basis upon which to seek discretionary group status Superintendent must recognize the discretionary group

Small groups: 

Small groups Applicable to groups of 50 or fewer – exclusive of spouses and dependents See 11 NYCRR Part 360 (Regulation 145)

Checklists: 

Checklists Intended as a summary, not intended as a substitute for statute or regulation Every applicable section of the appropriate checklist should be adequately addressed and completed Be sure to note the location where the requirement is met

Policies Issued Outside of NY: 

Policies Issued Outside of NY §3201(b)(1) and 11 NYCRR Part 59 (Regulation 123) - deemed delivered in NY and subject to review and approval, regardless of the actual place of delivery, if the policy is issued to: Groups not recognized in §4235 §4235(c)(1)(D)*, (K), (L), (M) and §4237(a)(3)(F)

Standard Transmittal Form: 

Standard Transmittal Form Use the most recent version available on SERFF or the website (paper) Complete all applicable fields with consistent and accurate information Correct insurer name Correct NAIC number Accurate listing of forms and coverage type

SERFF Standard Transmittal : 

SERFF Standard Transmittal

Prefiling: 

Prefiling Follow conditions in 52.32 for initial letter Submit policy forms within 6 months of the agreement to provide the insurance Reference file number of prefiling letter when submitting policy forms

Single Case Basis Filings: 

Single Case Basis Filings Allows an insurer to tailor benefits for a particular policyholder Not appropriate for HMO products or small group products Specify the proposed policyholder in cover letter or Standard Transmittal form

Intake: 

Intake Identify for assignment and loading file into system Licensed filing company, NAIC number, type of insurer Product type, type of coverage, method of review, filing type Review for completeness of requirements Assign to reviewers; or Close for incompleteness Lack of necessary rate materials Incomprehensible filing

Assignment: 

Assignment Directed to assigned attorney and actuary Check SERFF filing or acknowledgement letter (paper) for names of reviewers All communications to be sent to assigned reviewers Concurrent review of forms and rates

The Process: 

The Process Intake Forms Rates Rating Section Supervisor Legal Section Supervisor Art. 43 / HMO Commercial – Indiv. Commercial – Grp. Elder Unit – Med Supp, LTC Reviewing Actuary Reviewing Attorney Approval Assignment Review Disposition (Goes in the Rate Manual) Rates placed on File or Approved

Preliminary Review: 

Preliminary Review First Look

Reasons a File May Be Closed: 

Reasons a File May Be Closed 3 Strikes Incomplete and Incomprehensible Filings Failure to respond

3 Strikes: 

3 Strikes Statutory and regulatory errors – objective, not subjective. Note: errors of law may go beyond what is included in the checklist. Circular Letter No. 14 (1997). Intended to avoid unnecessary delay and inefficient use of Department’s limited resources.

Incomplete & Incomprehensible Filings: 

Incomplete & Incomprehensible Filings Insufficiency of materials provided. Failure to satisfy submission requirements in SERFF. If bypassed, provide explanation. Lack of adequate explanation of product. Innovative product not in compliance with statutes and regulations. Impermissible group policyholder. Inability to determine type of product. Inconsistency of information provided.

Failure to Respond: 

Failure to Respond Circular Letter No.18 (1999) requires a complete written response within 15 calendar days. Files closed under Circular Letter No. 18 (1999) cannot be reopened.

Resubmission: 

Resubmission Fulfill all requirements of a new submission (form & rate). In addition: Reference previously closed Department file number. Address all outstanding comments from prior correspondence. Conduct thorough review of entire filing to ensure compliance with all applicable statutes and regulations. Resubmissions are assigned a new file number and prioritized as a new filing.

Why you would not get the priority you asked for: 

Why you would not get the priority you asked for Failure to include proper certification. Reliance on previously approved language which is no longer in compliance. Lack of template; reliance on the template of a different company (“me too” filing). Lack of required signature on the certification form. Failure to include black-lined, previously approved form. Failure to include a completed checklist.

Comment/Objection Letters: 

Comment/Objection Letters Intended to make submissions compliant. Intended to request more information. Reconsideration of a comment requires justification. 15 days to respond - Circular Letter No. 18 (1999). Direct response to the reviewing attorney or actuary.

Dispositions: 

Dispositions Concurrent review of forms and rates by Legal Section and Rating Section, respectively. Clearance by either section not necessarily simultaneous.

Approvals: 

Approvals Final approval of policy forms with or without rates is confirmed by a formal approval letter written by the Legal Section. Rate Only approvals are conveyed with a “Placed On File” letter by the Rating Section. A stamped paper copy of each approved form is mailed to the company to be retained by the company along with the approval letter.

Filed for Reference: 

Filed for Reference Confirmed by a formal letter written by the Legal Section. Documents are not mailed to the company. Disposition applies to: variable material, advertising, out-of-state submissions, provider network materials, etc.

Requirements For Rate Filings  Regulation 62 : 

Requirements For Rate Filings Regulation 62 52.40 - Procedure and requirements for filing of rates. 52.44 - Standards for annual filing of experience data. 52.45 - Minimum loss ratio standards.

When A Rate Filing Is Necessary: 

When A Rate Filing Is Necessary Any time premiums or commissions increase or decrease; For any forms filing involving benefits (except pre-filings), even if the premium impact is zero; For any forms filing not involving benefits, whenever a premium or a premium adjustment might be reasonably anticipated; Any time there is a change to one of the rate manual pages.

General Requirements For Rate Filings: 

General Requirements For Rate Filings Actuarial memorandum Actuarial certification Rate manual pages

Slide58: 

Description of benefits. Detailed description of and justification for the proposed premiums including the methods and assumptions used, the underlying claim costs and/or experience data used, and modification thereto. The breakdown of the non-claims expense components into administrative expenses, commissions, statutory reserve and surplus, etc. The expected loss ratio (including expected loss ratios by duration, if required. For changes to existing products or premiums, a summary of changes in benefits and/or premium levels being proposed, plus past NY experience on this or similar coverage. If NY experience does not exist or is not credible, submit nationwide experience and state how NY rates, if any, compare to the nationwide rates. Actuarial Memorandum

Slide59: 

The filing is in compliance with all applicable laws and regulations. The expected loss ratio meets the minimum requirements. The benefits are reasonable in relation to the premium charged. The rates are not discriminatory. Actuarial Certification Signed By An Actuary Acting on Behalf of the Insurer

Rate Manual Pages: 

Rate Manual Pages Table of contents; Numbered rate pages; Insurer name on each page; Brief description of benefits, type of coverage, limitations, exclusion, and issue limits; Commission schedules; Underwriting guidelines and/or underwriting manual; and For group insurance, experience rating formulas for transfer business and renewal business.

Rate Manuals : 

Rate Manuals Four types: Active individual (current rates for individual and franchise products still issued) Inactive individual (current rates for individual and franchise products no longer issued) Group Blanket

Rate Manuals (cont.): 

Rate Manuals (cont.) Are public records; Should contain tables of contents; Should contain numbered pages to facilitate replacements; Should contain enough information to calculate the premiums for all possible benefit, age, and area variations; Should contain experience rating formulae for group and blanket business, where applicable; Should be kept current.

Experience Reporting and Monitoring Required by Regulation 62: 

Experience Reporting and Monitoring Required by Regulation 62 52.44(a) – Annual experience reporting form - pertains to individual insurance issued to persons age 65 and over. 52.44(b) – Annual experience monitoring – pertains to individual insurance issued to persons under age 65. 52.44(c) – Annual Medicare supplement refund calculation form.

Tips for Success: 

Tips for Success Speeding to Market

Tips for Success: 

Tips for Success Use previously approved forms and submit black lined copy with changes. Use the checklists. If you have a new product, come in to talk to us first. It’s the best use of our time and yours. Learn from previous submissions to avoid repeated errors.

Tips for Success cont’d: 

Tips for Success cont’d Include Variable Material - 52.31(l) Allows for flexibility without having to make multiple submissions Provide the full range of what may be included in the parenthetical for the forms (must match what is included in the rate filing). For the rate manual, provide the means for calculating the premium for each variable. Do not include explanations that the variable “will conform to law” or “as requested by policyholder.”

Tips for Success cont’d: 

Tips for Success cont’d Freedom of Information Law (FOIL) Approved forms and rate manuals are obtainable FOIL requires that requests for access to records be made in writing (electronically on-line, by mail, or by fax) directed to the Records Access Officer in either the New York City or Albany office. Complete the on-line eForm on website and submit it electronically to the Department

Tips for Success cont’d: 

Tips for Success cont’d Avoid Common Errors: Use the correct company name and NAIC number Use only one licensee per filing Submit a Flesch score certified by an officer of the company - §3102(c) and (d) Include the fraud warning in applications - §403(d) Certifications by previously approved forms must have been approved within 3 years

Speed Bumps: 

Speed Bumps

Standard Provisions: 

Standard Provisions Depending on the type of policy, there may be standard provisions that are required to be included (e.g., proof of loss, etc.). Consult the checklist for your type of product (if available). Make sure the statutory language is used.

Mandates: 

Mandates Look to the description in statute to assess which mandates apply to the specific product Note: All mandates apply to group HMO contracts Mandates apply to all expense incurred and indemnity benefits that exceed the level of benefits described in the basic hospital and basic medical descriptions – 52.5 and 52.6 E.g., Accidental Death and Dismemberment policy with a medical benefit Include and describe mandated benefits in compliance with statutory requirements

Make Available Benefits: 

Make Available Benefits Not required to be included in every policy, but must match the statutory description. Can also offer variations in addition to the make availables. Must be made available at the request of the policyholder for inclusion in the policy. Vary by product type. Certain products require written annual notice of make availables.

Exclusions: 

Exclusions Exclusion must be permitted by statute or regulation - 52.16(c). Coverage premised on the concept of “medical necessity.” That is, no insurer has to cover care that is not medically necessary for the treatment of illness or injury. Insurers are not required to cover care that is experimental and/or investigational in nature. An insured has internal and external appeal rights when the insurer denies coverage for care because it determines that the care was not medically necessary or that it was experimental and/or investigational.

Pre-existing Conditions: 

Pre-existing Conditions Use appropriate pre-existing condition provisions Hospital, medical, surgical coverage - §3216(d)(1)(b), §3232, 52.20 Group disability - §3234, 52.18(a)(5) Individual disability and Group accident - 52.2(v) Article 43 - §4318 Medicare supplement - 52.22(a)(5) and (b)(3) Long term care - 52.25(b)(2)(i) Policies covering insureds age 65 and over - 52.17(a)(28) and 52.18(a)(5) Specified disease – 52.15(b)(6)

Dependents: 

Dependents Spouse Children Dependent children under 19 Dependent children over 19 who are full time students - requires coverage for college students on a medical leave of absence under certain circumstances Dependent children over 19 who are incapable of self-support due to the conditions in statute “Children” must include adopted, step and proposed adoptive Newly born adopted infants per statute Other persons chiefly dependent on insured (including domestic partners) – §§ 4235(f)(1), 4305(c)(1)

Dependents cont’d.: 

Dependents cont’d. Domestic partners (not available for individual or group remit contracts) Must establish financial interdependence. The following would be acceptable as collectively, sufficient to establish such interdependence: 1. Registration as a domestic partnership or an alternative affidavit of domestic partnership; 2. Proof of cohabitation (e.g., a driver’s license, tax return or other sufficient proof); and 3. Evidence of two or more items like: joint bank account, joint credit card or charge card, joint obligation on a loan, joint ownership of a motor vehicle.

External Appeal: 

External Appeal Right afforded to insureds for claims denied due to lack of medical necessity or that the care was experimental/investigational Article 49, Title II

COBRA/Continuation: 

COBRA/Continuation Applicable to group policies providing hospital, surgical or medical expense insurance for other than accident only. Gives the insured the right to “continue” under the policy even after termination from coverage under the group policy. Insured pays the premium. Federal COBRA rules apply to groups of >20. New York’s continuation statute applicable to groups of < 20 employees and other situations when COBRA does not apply.

Provider Networks: 

Provider Networks Insurance Law §3201(c)(3) The Department requests the following information: directory of participating providers; geographic service areas of the network (by county); provider selection criteria; sample provider contracts; quality assurance procedures; grievance assurance procedures; underlying assumptions regarding ratios of providers to insureds and travel times/distances for insureds to visit participating providers.

Electronic Transactions: 

Electronic Transactions Electronic Signatures and Records Act (ESRA) and Regulation 169 (11 NYCRR Part 420) Applications & electronic signatures Explain method of delivery of policy and certificate in full (include ability to obtain paper copy)

Combination Filings: 

Combination Filings Health and Life Health and Property Unique Multiple Health Products

Health and Life: 

Health and Life Guidance to be made available on Department’s website Separate benefits using rider or insert page to attach accident & health benefits to a life insurance product. Rider or insert page must have a unique form number to distinguish it from the life insurance policy Submissions should be directed to the appropriate bureau. (Remember to include appropriate rate materials for the accident and health benefits.) Exception: applications for combined products must be submitted to both bureaus

Health and Property: 

Health and Property Accident and health combined with casualty insurance (e.g., travel accident/sickness). Health Bureau reviews accident and health benefits and rates. Property Bureau sets requirements for the casualty components.

Unique Multiple Health Products: 

Unique Multiple Health Products Combination product to cover the insured at different phases of life E.g., Disability Income protects against lost wages and long term care to provide funds for needs associated with old age Submit under the predominant coverage type

Continuing Commitment: 

Continuing Commitment Bureau availability RAFFT Checklists – ongoing development Website – guidance & information Expanded use of technology – e.g., SERFF, FOIL, etc. Your suggestions for improvement - questionnaire

Department Contacts: 

Department Contacts Website: www.ins.state.ny.us Health Mailbox: health@ins.state.ny.us Phone: (518) 486-7815 Address: One Commerce Plaza, Suite 1909 Albany, NY 12257

Closing: 

Closing Slides to be posted on website Please complete questionnaire

Questions: 

Questions