Rate Request: New Product Filing
Decision: Reduced trend impact by 0.9%; approved on November 13, 2013.
On October 4, 2013, ConnectiCare, Inc. submitted a rate filing for new small group health plans that will provide major medical and prescription drug coverage and will include the Essential Health Benefits as required under the federal Patient Protection and Affordable Care Act (PPACA).
The company intends to market the plans outside of Access Health CT, the state-sponsored health exchange, but said the plans will conform to all applicable state laws and those of PPACA.
Because this is a new product with no market experience in Connecticut, the company calculated the rates based on the claims cost experience from its existing non-grandfathered small group risk pool of ConnectiCare, Inc. In building the rate for this product, the company looked at the cost of medical services and demand for those services – a factor known as “trend” – and projected that costs would increase at an annual rate of about 10.24 percent and 11.25 percent for pharmacy.
As a result of an actuarial review, the Department determined that the company’s calculated impact of “trend” was excessive based on recent experience. As a result, the Department reduced the “trend” impact to 8 percent for medical and 9 percent for pharmacy. The recalculated rates, which reflected a reduction of nearly 1 percent, were approved by the Department on November 13, 2013.