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Indiana Department of Insurance

Indiana Department of Insurance

IDOI > Company Compliance > Accident & Health  > Product Filing Information/Instructions  > 2015 ACA RATE and FORM FILING GUIDE 2015 ACA RATE and FORM FILING GUIDE

Regulatory Guidance for Filing Qualified Health Plans (QHPs)

Under the Affordable Care Act (ACA), a Marketplace will be established in each state, either by the state or the federal government, in time to operate beginning January 1, 2014. Plans offered in the Marketplace must be Qualified Health Plans (QHPs) that meet certain federal requirements as stated in the ACA and subsequent regulations, as well as any additional QHP certification requirements that might be imposed by the state. Under a Federally-facilitated Marketplace (FFM), all of the QHP certification functions, which are part of Plan Management, would be performed by the department of Health and Human Services (HHS). The Plan Management functions to certify a QHP as part of the QHP application include the following:

  • Licensure in Good Standing
  • Service Area
  • Network Adequacy
  • Essential Community Providers
  • Marketing Oversight
  • Accreditation
  • Essential Health Benefits
  • Actuarial Value
  • Discriminatory Benefit Design
  • Benefits of Meaningful Difference
  • Rates (New and Increases)

In a FFM, the state would retain existing statutory authority related to the review and/or approval of premium rates/forms consistent with the current procedures and provide licensure/solvency information. Certification of a QHP rate filing by the Marketplace would be contingent upon the state’s approval of the submitted rate. Indiana would continue to provide the Marketplace with information about rate practices and trends both within and outside of the Marketplace.

QHP form documents must meet the applicable requirements that the state currently requires on insurance forms. The following include, but are not limited to, additional ACA requirements for issuers providing coverage for non-grandfathered plans in the individual and small group markets both inside and outside of an Marketplace:

  • Include Essential Health Benefits (EHBs)
  • Provide Guaranteed Availability of Coverage
  • Provide Guaranteed Renewability of Coverage (with certain exceptions)
  • Comply with Actuarial Value (AV) Standards
  • Comply with Cost Sharing Standards
  • Comply with Marketing Standards
  • Prohibit Discriminatory Benefit Design and Implementation
  • Offer Specific Open Enrollment Periods
  • Offer Specific Special Enrollment Periods
  • Follow Specific Discontinuation of Product and Coverage Requirements
  • Provide Procedures for Enrollees to Request Clinically Appropriate Drugs Not Covered

Each issuer participating on the Marketplace must offer at least one gold QHP and one silver QHP. The issuer must also offer a child-only plan at the same level of coverage as any QHP. Since only non-grandfathered plans may be sold in the Marketplace, grandfathered plans will not be reviewed for certification requirements, nor will non-grandfathered plans not intended for sale on the Marketplace.

Regulatory Guidance for Filing Products to Comply with Essential Health Benefits (EHBs)

The ACA requires that all carriers offering coverage for non-grandfathered, individual and small group plans, both inside and outside the Marketplace, provide coverage for EHBs. Carriers must include items and services within the following 10 benefit categories as part of their plan design to comply with the EHB requirement:

  • Ambulatory Patient Services
  • Emergency Services
  • Hospitalization
  • Maternity and Newborn Care
  • Mental Health and Substance Use Disorder Services, Including Behavioral Health Treatment
  • Prescription Drugs
  • Rehabilitative and Habilitative Services and Devices
  • Laboratory Services
  • Preventive and Wellness Services and Chronic Disease Management
  • Pediatric Services, Including Oral and Vision Care

For plans on the Marketplace, pediatric dental services are not required as an EHB unless there is no stand-alone pediatric dental plan certified to be on the state’s Marketplace. For plans off the Marketplace, pediatric dental services are required as an EHB, regardless of what other plans may be available off the Marketplace.

The state is required to choose a benchmark plan or default to the largest small group plan by enrollment in the state. The plan will constitute the EHBs for the non-grandfathered, individual and small group market for calendar years 2014 and 2015. The benchmark plan selected for Indiana is the Anthem Blue 5.0 – Blue Access PPO – Medical Option #6/Rx Option G. In addition to the benefits provided by the benchmark plan, all state mandated benefits are also included in the EHBs.

Actuarial Guidelines

The following provides actuarial guidelines related to EHB Substitutions, Actuarial Value (AV), Cost Sharing Reductions and Fair Premiums:

I) EHB Substitutions

The IDOI has elected not to allow for actuarial substitutions.  Certain provisions may be adopted by the IDOI to allow carriers to make actuarially equivalent substitutions for their plans within each of the 10 EHB categories specified except for prescription drug benefits.  The state may revisit this decision for future plan years.

If actuarial substitutions are allowed in the future, the following data would need to be submitted to the IDOI as part of filing requirements to review substitution options:

  • Attach a demonstration/explanation of equivalent value in each category to the Actuarial Memorandum in SERFF and include the following:

    • Provide an explanation of actuarial methodology following Actuarial Standards of Practice (ASOP)

    • Use a standardized plan population

    • Determine equivalence regardless of cost-sharing

  • Provide AV both before and after substitution including how benefits were defined and entered into the AV calculator.

  • Include attestation certifying data used to derive substitution is accurate and follows ASOP.

II) Actuarial Value

Carriers must supply AV for plans both inside and outside the health insurance Marketplace for consumer plan comparison purposes and to properly evaluate plans as part of the actuarial review.

The ACA requires non-grandfathered individual and small group health insurance plans, except for catastrophic plans, to fall within one of four “metal tiers” as defined by the AV of the benefits offered by the plan, relative to the full cost of the EHBs:

  • Platinum: 90% AV
  • Gold: 80% AV
  • Silver: 70% AV
  • Bronze: 60% AV

Plans would be allowed a margin of +/- 2% of the required AV for each metal tier. At a minimum, all issuers selling coverage through the Marketplace must make available at least one plan in the silver level and one plan in the gold level.

The ACA defines a catastrophic plan as a permissible benefit design offered to certain qualified individuals. Catastrophic plans do not have to meet a specific AV, but must comply with the maximum out-of-pocket limits.  Catastrophic plans must include rates for all ages.

The metallic levels of coverage that plans will be categorized by the ACA are not defined by deductibles, copayments, or coinsurance, instead, AV is used. For example, a plan with an AV of 60% (bronze plan) means that for a standard population, the plan will pay 60% of their essential health benefits, while the enrollees in it will pay 40% of the cost through some combination of deductibles, copays and coinsurance. With a higher AV, the plan will have less patient cost-sharing resulting in more premium amount on average for the insured. The percentage a plan pays for any given enrollee will generally be different from the AV, which is an aggregated average in terms of spending.

III) Cost-Sharing Reductions

  • Ensure the following cost sharing limits are maintained:

    • High-Deductible Health Plans (HDHP) for 2015 - $6,600 Individual/ $13,200 Family

The ACA outlines requirements for QHPs to provide reduced cost-sharing for individuals purchasing coverage through the Marketplace with a household income below 250% of Federal Poverty Level (FPL). Each silver level plan submitted to the Marketplace must be accompanied by three variants providing AVs of 73%, 87% and 94%. These AVs would be provided in the same way that AVs for the metal tiers will be provided.

Cost-sharing must first be reduced by lowering the out-of-pocket limit to levels specified in annual guidance that will be provided by HHS, and then by applying adjustments to other cost-sharing factors. Cost-sharing reductions exclude reductions in premiums, balance billing amounts for non-network providers, and spending for non-covered services. The design of reduced cost-sharing variants cannot violate prohibitions on discriminatory benefit design.

The ACA provides that QHPs covering an American Indian/Alaskan Native whose family income is less than 300% of the FPL shall not be subject to any cost-sharing under the plan.

IV) Fair Premiums

The ACA requires non-grandfathered individual and small group health insurance plans to only vary the rate charged for a particular plan or coverage by the following:

  • Age Rating Factors (same)
    • 3:1 ration as stated in the regulation
  • Geographic Rating Areas (same)
  • Tobacco Rating (changed)
  • Limitation goes away in 2015 
  • Family Composition (same)
  • At this time, IDOI is not electing to narrow the bands and ratios required by the ACA.

    Regulatory Guidance for Filing Pediatric/Adult Dental Products

    Pediatric dental is one of the ten essential health benefit (EHB) categories therefore the department assumes stand-alone dental plans will be offering pediatric dental coverage. As a result, if a carrier is offering major medical products on the FFM, they are not required to also offer pediatric dental coverage since there are stand-alone plans available. It is the carrier’s choice if they still want to offer pediatric dental and also adult dental on the Marketplace. It is not determined if stand-alone adult dental will be offered on the Indiana FFM.

    Carriers that are not participating on the FFM must offer pediatric dental coverage with their major medical plan since pediatric dental is an EHB. Carriers that offer major medical, non-grandfathered health insurance products in the individual and/or small group market must meet EHB requirements whether participating or not on the FFM. Stand-alone adult dental plans will continue to be offered off the FFM as a current option in the market and is not considered part of the EHB requirements.

    Grandfathered stand-alone pediatric and/or stand-alone adult (family) plans are excepted benefits under HIPAA and are exempt from ACA market insurance reforms. However, the ACA requires for carriers offering dental coverage for the non-grandfathered, individual and small group plans inside the Marketplace to meet the same requirements as a qualified health plans, as relevant. Further guidance is anticipated as related to filing for dental plans.

    When filing for a pediatric and/or adult dental product whether on or off the FFM, please consider that parts of the new filing instructions, checklists and/or requirements may not be applicable and can be bypassed or noted as N/A.

    Regulatory Guidance for Filing Pediatric/Adult Vision Products

    Pediatric vision is one of the ten EHB categories. As stated above, carriers that offer major medical, non-grandfathered health insurance products in the individual and/or small group market must meet EHB requirements whether participating or not on the FFM. As a result, carriers must include pediatric vision coverage as part of their major medical plan for both on and off the FFM. Stand-alone pediatric vision plans will not be available on the FFM. Stand-alone adult vision plans may be offered on the Indiana FFM. Stand-alone adult vision plans will continue to be offered off the FFM as a current option in the market and is not considered part of the EHB requirements.

    When filing for a pediatric and/or adult vision product whether on or off the FFM, please consider that parts of the new filing instructions, checklists and/or requirements may not be applicable and can be bypassed or noted as N/A. Pediatric dental and/or vision plans provide coverage for individuals under the age of 19.

    Summary of 2014-15 Market Reforms

    The following provide state choices related to the market reform provisions effective for plan or policy years beginning on or after January 1, 2014:

    • Age Rating- Limit age rating to 3:1 ratio as stated in the regulation.
    • Age Curve- Uniform age curve as stated in the regulation.
    • Tobacco Rating- Limitation goes away in 2015.
    • Geographic Rating Areas- Refer to Bulletin 197
    • Family Tiers- Establish family tiers with cap of 3 members under the age of 21 that are rated as stated in the regulation.  Must provide coverage to age 26.
    • Premium Basis- Rates calculated in single risk pool.
    • Merging Markets- Individual and small group markets will not be merged. Maintain separate risk pools.