law16145

Chapter 145

2016 -- S 2209 SUBSTITUTE A AS AMENDED
Enacted 06/27/2016

A N A C T

RELATING TO INSURANCE - RATE REVIEW ACT

Introduced By: Senator Maryellen Goodwin

Date Introduced: January 27, 2016

It is enacted by the General Assembly as follows:

SECTION 1. Section 27-19-6 of the General Laws in Chapter 27-19 entitled "Nonprofit

Hospital Service Corporations" is hereby amended to read as follows:

27-19-6. Rates charged subscribers -- Reserves. -- (a) Public hearings General: - The

rates proposed to be charged, or a rating formula proposed to be used, by any corporation

organized under this chapter to employers, the state or any political subdivision of the state, or

individuals, shall be filed by the corporation at the office of the health insurance commissioner

(hereinafter referred to as the "commissioner"). Within sixty (60) days after receipt of the

application, the commissioner, or his or her designee shall hold a hearing on all rates proposed for

health insurance coverage offered in the individual market as defined in § 27-18.5-2 upon not less

than ten (10) days written notice prior to the hearing. With regard to any other rates subject to the

commissioner's jurisdiction the commissioner, or his or her designee, may hold a hearing upon

not less than ten (10) days written notice prior to the hearing. The notice shall be published by the

commissioner in a newspaper or newspapers having aggregate general circulation throughout the

state at least ten (10) days prior to the hearing. The notice shall contain a description of the rates

proposed to be charged and a copy of the notice shall be sent to the applicant and to the

department of the attorney general. In addition, the applicant shall provide by mail, at least ten

(10) days prior to the hearing, notice of the proposed rate increase for health insurance coverage

offered in the individual market as defined in § 27-18.5-2 to all subscribers subject to the

proposed rate increase.

(b) Public hearings: Within ten (10) days after receipt of a filing, the commissioner shall

determine, subject to the provisions of section (f) of this section, whether they intend to hold a

public meeting or a public hearing at which time notice of such determination shall be sent to the

insurance advocacy unit of the attorney general. Any such public hearing shall commence within

sixty (60) days after receipt of the application, upon not less than ten (10) days written notice

prior to the hearing, published by the commissioner in a newspaper or newspapers having

aggregate general circulation throughout the state, at least ten (10) days prior to the hearing. The

notice shall contain a description of the rates proposed to be charged and a copy of the notice

shall be sent to the applicant and to the department of the attorney general. In the event there is a

public hearing, the attorney general may engage the services of any expert or consultant

necessary to assist in reviewing the filing, including having the ability to seek additional relevant

information from the filer. All public hearings held pursuant to this section shall be held in

accordance with the provisions of chapter 35 of title 42.

(b)(c) Filings with the Attorney General's Office: - The applicant shall provide a copy of

the filing on all rates proposed for health insurance coverage offered in the individual market as

defined in § 27-18.5-2, to the Iinsurance Aadvocacy Uunit of the Aattorney Ggeneral's Ooffice

simultaneously with the filing at the office of the health insurance commissioner.

(c)(d) Procedures: - At any hearing held under this section, the applicant shall be required

to establish that the rates proposed to be charged or the rating formula to be used are consistent

with the proper conduct of its business and with the interest of the public.

Rates proposed to be charged by any corporation organized under this chapter shall be

sufficient to maintain total reserves in a dollar amount sufficient to pay claims and operating

expenses for not less than one month. Those reserves shall be computed as of each December

31st, and a report setting forth the computation shall be submitted to the commissioner together

with the corporation's Rhode Island annual statement to the commissioner. Any documents

presented in support of a filing of proposed rates under this section shall be made available for

inspection by any party entitled to participate in a hearing or admitted as an intervenor in a

hearing or such conditions as the commissioner may prescribe provided under this section at a

time and at a place as the commissioner may deem reasonable. The commissioner, or his or her

designee, upon the hearing, may administer oaths, examine and cross-examine witnesses, receive

oral and documentary evidence, and shall have the power to subpoena witnesses, compel their

attendance, and require the production of books, papers, records, correspondence, or other

documents which he or she deems relevant. The commissioner shall issue a decision as soon as is

reasonably possible following the completion of the hearing. The decision may approve,

disapprove, or modify the rates proposed to be charged by the applicant. Applicants requesting

changes in rates shall underwrite the reasonable expenses of the commissioner in connection with

the hearing, including any costs related to advertisements, stenographic reporting, and expert

witnesses fees.

(1) The applicant shall be required to establish that the rates proposed to be charged are

consistent with the proper conduct of its business and with the interest of the public.

(2) Any documents presented in support of a filing of proposed rates under this section

shall be made available for public examination at a time and place that the commissioner may

deem reasonable.

(3) If a public hearing is held pursuant to subsection (b) of this section, the commissioner,

or their designee, upon the hearing, may administer oaths, examine and cross-examine witnesses,

receive oral and documentary evidence, and shall have the power to subpoena witnesses, compel

their attendance, and require the production of books, papers, records, correspondence, or other

documents which they deem relevant. Any designee who shall conduct a hearing pursuant to this

section shall report their findings, in writing, to the commissioner, within a reasonable time

following the conclusion of the hearing, with a recommendation for approval, disapproval, or

modification of the rates proposed to be charged by the applicant. The commissioner shall make

and issue a decision not later than ten (10) days following the issuance of the recommended

decision or, if the commissioner hears the application without the appointment of a designee, as

soon as is reasonably possible following the completion of the hearing on the proposed rate

change. The decision may approve, disapprove, or modify the rates proposed to be charged by the

applicant.

(d)(e) The term "designee," as used in this section, shall mean a person who is impartial,;

a member in good standing of the Rhode Island bar; and a person who is sufficiently acquainted

with the rules of evidence as used in the superior court of the state so as to enable that person to

conduct a hearing as designee of the commissioner. The reasonable per diem cost of the designee,

as appointed by the commissioner, shall be paid by the applicant requesting changes in the rates.

(f) Notwithstanding any provision of this section to the contrary, the commissioner shall

hold a public hearing in any instance where the applicant covers ten thousand (10,000) or more

enrolled individuals in the individual market, and the rates proposed in the filing for the annual

rate increase for products offered in the individual market produce an overall average rate

increase of ten percent (10%) or more. The commissioner shall require that any filing for a rate

increase for products offered in the individual market shall include the calculation of the "overall,

average-rate increase" in order to determine whether a public hearing is required.

(1) For the purposes of this section, the calculation of the "overall, average-rate increase"

shall be based on the overall average increase percent weighted by member premiums, excluding

the effects of age scale increases. To calculate the overall, average-rate increase, the applicant

shall multiply the proposed rate increase by product, times the total monthly renewing premium

for each product, and then divide the product by the sum of monthly renewing premiums for all

products. The commissioner shall require this calculation to be provided as part of the applicant's

individual market rate filing.

(g) In the event that subsection (f), in combination with §42-62-13(b), would result in

more than one public hearing in any given calendar year, the commissioner may defer one or

more public hearing(s) for an applicant resulting from subsection (f) or §42-62-13(b) until the

subsequent calendar year, with the provision that one of the deferred applicants shall be required

to have a public hearing in the subsequent year, whether or not the applicants' filing satisfies the

requirements of subsection (f) or §42-62-13(b) in that subsequent calendar year.

(h) The commissioner shall notify the attorney general of the filing(s) to be deferred and

the attorney general shall be given the opportunity to provide written comments and

recommendations to the commissioner regarding any such filing(s) deferred in accordance with

subsection (g).

(i) Notwithstanding any other provision of law, the filing of proposed rates or a rating

formula, and the holding and conducting of any public hearing in connection with these proposed

rates or rating formula, shall be held in accordance with the provisions of chapter 35 of title 42.

(j) Public comment. Whether or not a public hearing is held pursuant to subsection (f),

the commissioner shall solicit public comment regarding the rates proposed to be charged. Public

comment shall be solicited upon not less than ten (10) days written notice prior to the date that

either:

(1) A public meeting at which verbal comments may be provided; or

(2) That written comment must be received by the commissioner. The notice shall contain

a description of the rates proposed to be charged, or the formula proposed to be used, and a copy

of the notice shall be sent to the applicant and to the insurance advocacy unit of the department of

attorney general. The attorney general shall be permitted to conduct discovery in relation to the

actuarial analysis and actuarial assumptions of the filer regarding any filing in the individual

market as defined in §27-18.5-2. Any documents presented in support of the filing under this

section shall be made available for public examination at a time and place that the commissioner

may deem reasonable.

(k) The applicant shall bear reasonable expenses of the commissioner in connection with

a filing made pursuant to this section, including any costs related to advertisements, stenographic

reporting, and expert fees, regardless of whether a public hearing is held. The applicant shall bear

reasonable expenses of the attorney general in relation to any public hearing conducted pursuant

to this section. The applicant shall bear reasonable expenses of the attorney general in relation to

any filing in the individual market that is not subject to a public hearing.

SECTION 2. Section 27-20-6 of the General Laws in Chapter 27-20 entitled "Nonprofit

Medical Service Corporations" is hereby amended to read as follows:

27-20-6. Rates charged subscribers -- Reserves -- Hearing by director commissioner.

-- (a) Public hearings General: - The rates proposed to be charged, or a rating formula proposed to

be used, by any corporation organized under this chapter, to its subscribers, employers, the state

or any political subdivision of the state, or individuals, shall be filed by the corporation at the

office of the health insurance commissioner (hereinafter referred to as the "commissioner").

Within sixty (60) days after receipt of the application, the commissioner, or his or her designee,

shall hold a hearing on all rates proposed for health insurance coverage offered in the individual

market as defined in § 27-18.5-2 upon not less than ten (10) days written notice prior to the

hearing. With regard to any other rates or rating formula subject to the commissioner's

jurisdiction the commissioner, or his or her designee, may hold a hearing upon not less than ten

(10) days written notice prior to the hearing. The notice shall be published by the commissioner

in a newspaper or newspapers having aggregate general circulation throughout the state at least

ten (10) days prior to the hearing. The notice shall contain a description of the rates proposed to

be charged and a copy of the notice shall be sent to the applicant and to the department of the

attorney general. In addition, the applicant shall provide by mail, at least ten (10) days prior to the

hearing, notice of the proposed rate increase for health insurance coverage offered in the

individual market as defined in § 27-18.5-2 to all subscribers subject to the proposed rate

increase.