RS 22:1091 Health insurance plans subject to rate limitations
SUBPART D. RATES
§1091. Health insurance plans subject to rate limitations
A. The provisions of R.S. 22:1091 through 1095 shall apply to any health benefit plan which provides coverage to a small employer except the following:
(1) An Archer medical savings account that meets all requirements of Section 220 of the Internal Revenue Code of 1986.
(2) A health savings account that meets all requirements of Section 223 of the Internal Revenue Code of 1986.
B. Notwithstanding any law to the contrary, the following terms shall be defined as follows:
(1) "Actuarial certification" means a written statement by a member of the American Academy of Actuaries that a small employer carrier is in compliance with the provisions of R.S. 22:1092, based upon the person's examination, including a review of the appropriate records and of the actuarial assumptions and methods utilized by the carrier in establishing premium rates for applicable health benefit plans.
(2) "Base premium rate" means, for each class of business as to a rating period, the lowest premium rate charged or which could have been charged under a rating system for that class of business, by the small employer carrier to small employers with similar case characteristics for health benefit plans with the same or similar coverage.
(3) "Carrier" means an insurance company, including a health maintenance organization as defined and licensed to engage in the business of insurance under Subpart I of Part I of Chapter 2 of this Title, which is licensed or authorized to issue individual, group, or family group health insurance coverage for delivery in this state.
(4) "Case characteristics" mean demographic or other relevant characteristics of a small employer, as determined by a small employer carrier, which are considered by the carrier in the determination of premium rates for the small employer. Claim experience, health status and duration of coverage since issue are not case characteristics for the purposes of this Section.
(5) "Class of business" means all or a distinct grouping of small employers as shown on the records of the small employer carrier.
(a) A distinct grouping may only be established by the small employer carrier on the basis that the applicable health benefit plans:
(i) Are marketed and sold through individuals and organizations which are not participating in the marketing or sale of other distinct groupings of small employers for such small employer carrier;
(ii) Have been acquired from another small employer carrier as a distinct grouping of plans; or
(iii) Are provided through an association with membership of not less than twenty-five small employers which has been formed for purposes other than obtaining insurance.
(b) A small employer carrier may establish no more than two additional groupings under each of the items in Subparagraph (a) of Paragraph (5) of this Subsection on the basis of underwriting criteria which are expected to produce substantial variation in the health care costs.
(c) The commissioner may approve the establishment of additional distinct groupings upon application to the commissioner and a finding by the commissioner that such action would enhance the efficiency and fairness of the small employer insurance marketplace.
(6) "Health benefit plan", "plan", or "health insurance coverage" means benefits consisting of medical care, provided directly, through insurance or reimbursement, or otherwise and including items and services paid for as medical care, under any hospital or medical service policy or certificate, hospital or medical service plan contract, preferred provider organization, or health maintenance organization contract offered by a health insurance issuer. However, a "health benefit plan" shall not include limited benefit and supplemental health insurance; coverage issued as a supplement to liability insurance; workers' compensation or similar insurance; or automobile medical-payment insurance.
(7) "Health savings accounts" are those accounts for medical expenses authorized by 26 USC 220 et seq.
(8) "High deductible health plan" means a high deductible health plan or policy that is qualified to be used in conjunction with a health savings account, medical savings account, or other similar program authorized by 26 USC 220 et seq.
(9) "Index rate" means for each class of business for small employers with similar case characteristics the arithmetic average of the applicable base premium rate and the corresponding highest premium rate.
(10) "Medical savings account policy" means a high deductible health plan which is qualified to be used in conjunction with a medical savings account as provided in 26 USC 220 et seq.
(11) "New business premium rate" means, for each class of business as to a rating period, the premium rate charged or offered by the small employer carrier to small employers with similar case characteristics for newly issued health benefits plans with the same or similar coverage.
(12) "Rating period" means the calendar period for which premium rates established by a small employer carrier are assumed to be in effect, as determined by the small employer carrier.
(13) "Small employer" means any person, firm, corporation, partnership, or association actively engaged in business which, on at least fifty percent of its working days during the preceding year, employed no less than three nor more than thirty-five eligible employees, the majority of whom were employed within this state, and is not formed primarily for purposes of buying health insurance, and in which a bona fide employer-employee relationship exists. In determining the number of eligible employees, companies which are affiliated companies or which are eligible to file a combined tax return for purposes of state taxation shall be considered one employer. An employer group of one shall be considered individual insurance under this Section.
(14) "Small employer carrier" means any carrier which offers health benefit plans covering the employees of a small employer.
C. Group and individual high deductible health plans are excluded from the provisions of R.S. 22:1091 through 1095.
Acts 1991, No. 777, §2, eff. Sept. 30, 1992; Acts 1993, No. 54, §1; Acts 2001, No. 272, §1, eff. Jan. 1, 2002; Acts 2003, No. 659, §1; Acts 2004, No. 663, §1; Redesignated from R.S. 22:228.1 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009; Acts 2009, No. 93, §1.