State: Connecticut Filing Company: ConnectiCare Benefits, Inc.

Transcription

1 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: Product Name: Project Name/Number: / Filing at a Glance Company: Product Name: State: TOI: Sub-TOI: Filing Type: ConnectiCare Benefits, Inc. First Quarter 2014 Small Group Rate Filing (CBI) Connecticut HOrg02G Group Health Organizations - Health Maintenance (HMO) HOrg02G.004E Small Group Only - Other Rate Date Submitted: 05/20/2013 SERFF Tr Num: SERFF Status: CCIC Pending State Action State Tr Num: State Status: Co Tr Num: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other First Quarter 2014 Small Group Rate Filing (CBI) Implementation Date Requested: Author(s): Reviewer(s): Disposition Date: Disposition Status: Implementation Date: 01/01/2014 John Ducharme, Neil Kelsey, Joe Thomas Paul Lombardo (primary) State Filing Description: PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

2 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: Product Name: Project Name/Number: / HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other First Quarter 2014 Small Group Rate Filing (CBI) General Information Project Name: Project Number: Requested Filing Mode: Review & Approval Explanation for Combination/Other: Submission Type: New Submission Group Market Type: Employer Filing Status Changed: 07/09/2013 State Status Changed: Created By: John Ducharme Corresponding Filing Tracking Number: Status of Filing in Domicile: Date Approved in Domicile: Domicile Status Comments: Market Type: Group Group Market Size: Small Overall Rate Impact: Deemer Date: Submitted By: John Ducharme PPACA: Non-Grandfathered Immed Mkt Reforms PPACA Notes: null Exchange Intentions: Filing represents plans to be offered thru the Exchange Filing Description: First Quarter 2014 Small Group Rate Filing (CBI) - Exchange Company and Contact Filing Contact Information John Ducharme, Senior Actuarial Analyst 175 Scott Swamp Road Farmington, CT Filing Company Information ConnectiCare Benefits, Inc. 175 Scott Swamp Road Farmington, CT (860) ext. [Phone] jducharme@connecticare.com [Phone] CoCode: Group Code: 1127 Group Name: HIP INS GRP FEIN Number: State of Domicile: Connecticut Company Type: State ID Number: Filing Fees Fee Required? Retaliatory? Fee Explanation: No No PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

3 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Correspondence Summary Objection Letters and Response Letters Objection Letters Response Letters Status Created By Created On Date Submitted Responded By Created On Date Submitted Requesting Clarification Paul Lombardo 07/03/ /03/2013 John Ducharme 07/09/ /09/2013 Requesting Additional Information Paul Lombardo 05/24/ /24/2013 John Ducharme 07/01/ /01/2013 Amendments Schedule Schedule Item Name Created By Created On Date Submitted Supporting Document Actuarial Memorandum John Ducharme 07/21/ /22/2013 Filing Notes Subject Note Type Created By Created On Date Submitted Retention Charge Note To Filer Paul Lombardo 07/10/ /10/2013 PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

4 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: Product Name: Project Name/Number: / Objection Letter Objection Letter Status Objection Letter Date 07/03/2013 Submitted Date 07/03/2013 Respond By Date 07/17/2013 Dear John Ducharme, Introduction: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other First Quarter 2014 Small Group Rate Filing (CBI) Requesting Clarification Thank you for your response to CID questions, please provide the following as a follow-up to ConnectiCare's responses: 1) The date for the current capital and surplus can't be 12/31/13, please provide as of date for the capital and surplus provided in the response. 2) Confirm that the annual trend from the experience period to the rating period is 7.38%. 3) The Exchange fee has been defined as 1.35% of premium, if this is not the fee level in the filing, please adjust. 4) Exhibit I (Pricing Build-Up), includes ACA Fees as part of the benefit expense, these should be considered expenses and not benefits. Note, for purposes of the federal MLR calculation, they are subtracted from the premium, not added to the claims. Thank you in advance for your continued cooperation. Conclusion: Sincerely, Paul Lombardo PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

5 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: Product Name: Project Name/Number: / Objection Letter Objection Letter Status Objection Letter Date 05/24/2013 Submitted Date 05/24/2013 Respond By Date 06/07/2013 Dear John Ducharme, Introduction: Requesting Additional Information Please respond to the attached comments/questions from the Department. Thank you in advance for your cooperation. Conclusion: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other First Quarter 2014 Small Group Rate Filing (CBI) Sincerely, Paul Lombardo PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

6 CID Questions/Comments ConnectiCare Benefits, Inc Small Group Rate Filing May 24, Provide premium rates in a.pdf file format. 2. The Type of Insurance (TOI) is incorrect in SERFF, this company is not an HMO and should be filed under a more appropriate TOI 3. Complete the Rate Review Detail under the Rate/Rule Schedule Tab in SERFF. 4. Complete the Part I Unified Rate Review Template and the Part III Actuarial Memorandum as required by all issuers that are applying for at least one Qualified Health Plan (QHP) in a particular market, in a particular state. 5. Premium rates for Connecticut s state based exchange need to be finalized before 7/31/13. Pursuant to Federal guidance, after 7/31/13 the approved rates for 2014 cannot be changed. This means there cannot be any amendments to the filing at any point in time and the final approved rates, with quarterly trend built into the filing, will be used for all issues during calendar year ConnectiCare has stated that the rate filing is only for 1 st quarter 2014, this is in conflict with the Department s previous comment. Verify ConnectiCare will be using the quarterly trend within the filing to quote the remaining three quarters of Confirm that all plans offered through the exchange will be available off the exchange as well. 7. Since the basis for the rate filing is ConnectiCare Insurance Company s nongrandfathered small group experience for calendar year 2012, provide this experience along with the claim lag triangles supporting this experience. 8. Since the basis for the rate filing is ConnectiCare Insurance Company s nongrandfathered small group experience for calendar year 2012, provide unit cost and utilization data for the following benefit categories, consistent with the Part I Unified Rate Review Template: Inpatient Hospital; Outpatient Hospital; Professional; Other Medical; Capitation; Pharmacy.

7 9. It is the Departments understanding that ConnectiCare Benefits, Inc. was required to capitalize the company when licensed, provide the current capital and surplus for ConnectiCare Benefits, Inc. 10. Provide detailed support for the 24 month trend of 15.3%. Explain why this trend is greater than the trend for the individual market trend, proposed by ConnectiCare Benefits, Inc., of 12.5%. 11. Provide detailed support for the pricing period annual trend of 11.20%. 12. Explain why the annual trend assumed in the pricing period is 11.20%, when the annual trend from the experience period to the rating period is 7.4% annually. 13. Provide detailed support for the -2.5% population morbidity adjustment assumed in the filing. 14. Develop the incurred claims and earned premium on a pmpm basis prior to the Federal adjustments, then provide a step-by-step analysis of the adjustments in order to calculate the Federal MLR for rebate purposes. 15. Develop and identify the index rate for the rate filing in accordance with the Federal rating regulation. 16. Explain the wide disparity between the proposed area factors in this filing and the proposed area factors in the individual market rate filing submitted by ConnectiCare Benefits, Inc.

8 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Response Letter Response Letter Status Submitted to State Response Letter Date 07/09/2013 Submitted Date 07/09/2013 Dear Paul Lombardo, Introduction: Response 1 Comments: Attached is our response to your 2nd Objection Letter Changed Items: Supporting Document Schedule Item Changes Satisfied - Item: Response to Objection Letter #2 Comments: Attachment(s): Attached is our response to you 2nd Objection Letter Response to HIX SG Objection Letter #2.pdf No Form Schedule items changed. No Rate/Rule Schedule items changed. Conclusion: Sincerely, John Ducharme PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

9 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Response Letter Response Letter Status Submitted to State Response Letter Date 07/01/2013 Submitted Date 07/01/2013 Dear Paul Lombardo, Introduction: Response 1 Comments: Attahced is our response to your Objection Letter Changed Items: PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

10 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Supporting Document Schedule Item Changes Satisfied - Item: Actuarial Memorandum and Certifications Comments: Attachment(s): Previous Version Bypassed - Item: Bypass Reason: Attachment(s): Attached is a copy of the Actuarial memorandum that was provided to the Exchange. Due to file size this has been provided in a zip file formal Actuarial Memorandum_SHOP-CID.zip Actuarial Memorandum and Certifications No Unified Rate Review Template is provided Satisfied - Item: Comments: Attachment(s): Previous Version Bypassed - Item: Bypass Reason: Attachment(s): Unified Rate Review Template Attached is a copy of the URRT that was provided to the Exchange Unified Rate Review Template(URRT)_SHOP-Final.xlsm Unified Rate Review Template This filing is not proposing a rate increase nor is it to be offered in a Federally Facilitated Exchange state. Satisfied - Item: Comments: Attachment(s): Response to Objection Letter Attached is our response to your Objection Letter with support docs. Please note that the HIX SHOP rates needed to be provided in a zip file formal due to the file size Response to HIX SG Objection Letter.pdf HIX SG Claims Build.pdf Lag Triangles for SG Exchange Filing.pdf HIX SHOP Rates.zip PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

11 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Supporting Document Schedule Item Changes Satisfied - Item: Actuarial Memorandum and Certifications Comments: Attachment(s): Previous Version Bypassed - Item: Bypass Reason: Attachment(s): Attached is a copy of the Actuarial memorandum that was provided to the Exchange. Due to file size this has been provided in a zip file formal Actuarial Memorandum_SHOP-CID.zip Actuarial Memorandum and Certifications No Unified Rate Review Template is provided Satisfied - Item: Comments: Attachment(s): Previous Version Bypassed - Item: Bypass Reason: Attachment(s): Unified Rate Review Template Attached is a copy of the URRT that was provided to the Exchange Unified Rate Review Template(URRT)_SHOP-Final.xlsm Unified Rate Review Template This filing is not proposing a rate increase nor is it to be offered in a Federally Facilitated Exchange state. Satisfied - Item: Comments: Attachment(s): Response to Objection Letter Attached is our response to your Objection Letter with support docs. Please note that the HIX SHOP rates needed to be provided in a zip file formal due to the file size Response to HIX SG Objection Letter.pdf HIX SG Claims Build.pdf Lag Triangles for SG Exchange Filing.pdf HIX SHOP Rates.zip PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

12 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Supporting Document Schedule Item Changes Satisfied - Item: Actuarial Memorandum and Certifications Comments: Attachment(s): Previous Version Bypassed - Item: Bypass Reason: Attachment(s): Attached is a copy of the Actuarial memorandum that was provided to the Exchange. Due to file size this has been provided in a zip file formal Actuarial Memorandum_SHOP-CID.zip Actuarial Memorandum and Certifications No Unified Rate Review Template is provided Satisfied - Item: Comments: Attachment(s): Previous Version Bypassed - Item: Bypass Reason: Attachment(s): Unified Rate Review Template Attached is a copy of the URRT that was provided to the Exchange Unified Rate Review Template(URRT)_SHOP-Final.xlsm Unified Rate Review Template This filing is not proposing a rate increase nor is it to be offered in a Federally Facilitated Exchange state. Satisfied - Item: Comments: Attachment(s): Response to Objection Letter Attached is our response to your Objection Letter with support docs. Please note that the HIX SHOP rates needed to be provided in a zip file formal due to the file size Response to HIX SG Objection Letter.pdf HIX SG Claims Build.pdf Lag Triangles for SG Exchange Filing.pdf HIX SHOP Rates.zip No Form Schedule items changed. PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

13 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / No Rate/Rule Schedule items changed. Conclusion: Sincerely, John Ducharme PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

14 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Amendment Letter Submitted Date: 07/22/2013 Comments: Attached is an Amendment to our previously submitted rate filing Changed Items: No Form Schedule Items Changed. No Rate Schedule Items Changed. Supporting Document Schedule Item Changes Satisfied - Item: Actuarial Memorandum Comments: Attached is an amended CBI's SHOP(Small Group) Exchange Product Rate Filing Attachment(s): Rate Filing SHOP_Amendment.pdf Previous Version Satisfied - Item: Comments: Attachment(s): Actuarial Memorandum Attached is CBI's SHOP(Small Group) Exchange Product Rate Filing CompleteRateFilingSHOP_Final.pdf PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

15 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: Product Name: Project Name/Number: / Note To Filer Created By: Paul Lombardo on 07/10/ :18 AM Last Edited By: Paul Lombardo Submitted On: 07/10/ :20 AM Subject: Retention Charge Comments: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other First Quarter 2014 Small Group Rate Filing (CBI) Now that the expenses have been removed from claims and the pricing loss ratio is 72.8%, the retention charge of 22.7% needs to be revised to reflect those expenses moved to retention. Please change the retention charge to reflect the transfer of expenses from the claims portion to the premium portion. PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

16 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: Product Name: Project Name/Number: / HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other First Quarter 2014 Small Group Rate Filing (CBI) Post Submission Update Request Processed On 07/03/2013 Status: Created By: Processed By: Comments: Allowed John Ducharme Paul Lombardo Company Rate Information: Company Name:ConnectiCare Benefits, Inc. Field Name Requested Change Prior Value REQUESTED RATE: Projected Earned Premium: 12,392, Projected Incurred Claims: 9,439, Min: Max: 1, Weighted Avg.: PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

17 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Rate Information Rate data applies to filing. Filing Method: Rate Change Type: Neutral Overall Percentage of Last Rate Revision: % Effective Date of Last Rate Revision: Filing Method of Last Filing: Company Rate Information Company Overall % Overall % Written # of Policy Written Maximum % Minimum % Company Rate Indicated Rate Premium Holders Affected Premium for Change Change Name: Change: Change: Impact: Change for for this Program: this Program: (where req'd): (where req'd): this Program: ConnectiCare Benefits, Inc. New Product % % % % Product Type: HMO PPO EPO POS HSA HDHP FFS Other Covered Lives: Policy Holders: PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

18 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: Product Name: Project Name/Number: / Rate Review Detail COMPANY: Company Name: HHS Issuer Id: Product Names: Trend Factors: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other First Quarter 2014 Small Group Rate Filing (CBI) ConnectiCare Benefits, Inc. POS 7.4%(Annual) FORMS: New Policy Forms: Affected Forms: Other Affected Forms: HIX CBI/BMD SG 01 (1/2014), HIX CBI/POS OA SG 01 (1/2014), HIX CBI/POS OA SG 01 (1/2014), HIX CBI/DRider SG 01 (1/2014), CBI/B HIX/Bronze POS Upded HDHP/SG BS 01 (01/2014), CBI/S HIX/Silver POS/SG BS 01 (01/2014), CBI/G HIX/Gold POS/SG BS 01 (01/2014), CBI/B HIX/Bronze POS/HDHP HRA SG BS 01 (01/2014), CBI/G HIX/GOLD POS/HDHP HSA SG BS 01 (01/2014) REQUESTED RATE CHANGE INFORMATION: Change Period: Annual Member Months: 0 Benefit Change: None Percent Change Requested: Min: 0.0 Max: 0.0 Avg: 0.0 PRIOR RATE: Total Earned Premium: 0.00 Total Incurred Claims: 0.00 Annual $: Min: 0.00 Max: 0.00 Avg: 0.00 REQUESTED RATE: Projected Earned Premium: 12,392, Projected Incurred Claims: 9,439, Annual $: Min: Max: 1, Avg: PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

19 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Supporting Document Schedules Satisfied - Item: Comments: Attachment(s): Item Status: Status Date: Bypassed - Item: Bypass Reason: Attachment(s): Item Status: Status Date: Satisfied - Item: Comments: Attachment(s): Item Status: Status Date: Satisfied - Item: Comments: Attachment(s): Item Status: Status Date: Satisfied - Item: Comments: Actuarial Memorandum Attached is an amended CBI's SHOP(Small Group) Exchange Product Rate Filing Rate Filing SHOP_Amendment.pdf Consumer Disclosure Form ** Please note that you must bypass this Requirement at initial submission since the required documentation will not yet be available.** Actuarial Memorandum and Certifications Attached is a copy of the Actuarial memorandum that was provided to the Exchange. Due to file size this has been provided in a zip file formal Actuarial Memorandum_SHOP-CID.zip Unified Rate Review Template Attached is a copy of the URRT that was provided to the Exchange Unified Rate Review Template(URRT)_SHOP-Final.xlsm Response to Objection Letter Attached is our response to your Objection Letter with support docs. Please note that the HIX SHOP rates needed to be provided in a zip file formal due to the file size PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

20 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Attachment(s): Item Status: Status Date: Response to HIX SG Objection Letter.pdf HIX SG Claims Build.pdf Lag Triangles for SG Exchange Filing.pdf HIX SHOP Rates.zip Satisfied - Item: Response to Objection Letter #2 Comments: Attachment(s): Item Status: Status Date: Attached is our response to you 2nd Objection Letter Response to HIX SG Objection Letter #2.pdf PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

21 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Attachment Actuarial Memorandum_SHOP-CID.zip is not a PDF document and cannot be reproduced here. Attachment Unified Rate Review Template(URRT)_SHOP-Final.xlsm is not a PDF document and cannot be reproduced here. Attachment HIX SHOP Rates.zip is not a PDF document and cannot be reproduced here. PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

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30 CID Questions/Comments ConnectiCare Benefits, Inc Small Group Rate Filing May 24, Provide premium rates in a.pdf file format. Attached via SERFF 2. The Type of Insurance (TOI) is incorrect in SERFF, this company is not an HMO and should be filed under a more appropriate TOI In order to change the TOI, I will have to create new Rate Filings in SERFF. We can discuss how and when this needs to be done to insure that no information or questions and responses are lost. 3. Complete the Rate Review Detail under the Rate/Rule Schedule Tab in SERFF. Attached via SERFF 4. Complete the Part I Unified Rate Review Template and the Part III Actuarial Memorandum as required by all issuers that are applying for at least one Qualified Health Plan (QHP) in a particular market, in a particular state. Attached via SERFF 5. Premium rates for Connecticut s state based exchange need to be finalized before 7/31/13. Pursuant to Federal guidance, after 7/31/13 the approved rates for 2014 cannot be changed. This means there cannot be any amendments to the filing at any point in time and the final approved rates, with quarterly trend built into the filing, will be used for all issues during calendar year ConnectiCare has stated that the rate filing is only for 1st quarter 2014, this is in conflict with the Department s previous comment. Verify ConnectiCare will be using the quarterly trend within the filing to quote the remaining three quarters of Yes, ConnectiCare understands that under current Federal guidance there cannot be any amendments to the filing at any time after July 31, Further, ConnectiCare will be using quarterly trends noted within the filing to quote the remaining three quarters of This is reflected in the Rate Table that we provided to the Exchange as well as in the filing. 6. Confirm that all plans offered through the exchange will be available off the exchange as well. Yes, all plans offered through the Exchange will be available off the exchange as well

31 7. Since the basis for the rate filing is ConnectiCare Insurance Company s non-grandfathered small group experience for calendar year 2012, provide this experience along with the claim lag triangles supporting this experience. See attached exhibit for current claims experience with build up to match Exhibit 1 Pricing Build-up. Claim lag triangle is being provided and is attached 8. Since the basis for the rate filing is ConnectiCare Insurance Company s non-grandfathered small group experience for calendar year 2012, provide unit cost and utilization data for the following benefit categories, consistent with the Part I Unified Rate Review Template: Inpatient Hospital; Outpatient Hospital; Professional; Other Medical; Capitation; Pharmacy. See Exhibit at end of this document. 9. It is the Departments understanding that ConnectiCare Benefits, Inc. was required to capitalize the company when licensed, provide the current capital and surplus for ConnectiCare Benefits, Inc. The current capital and surplus as of December 31, 2013 is $1,186, Provide detailed support for the 24 month trend of 15.3%. Explain why this trend is greater than the trend for the individual market trend, proposed by ConnectiCare Benefits, Inc., of 12.5%. Refer to items 11 and 12 below. The difference between Small Group and Individual trend reflects unit cost differences between the networks. 11. Provide detailed support for the pricing period annual trend of 11.20%. Trend factors are developed using the combined experience of ConnectiCare and affiliated companies. Components of the manual prospective pricing trend are shown in the table below. Pricing Trends for Exchange Manual Utilization Gross Gross Leveraging Prospective Per 1,000 Unit Cost PMPM Impact Pricing Trend Total 3.9% 5.3% 9.4% 1.6% 11.2% 12. Explain why the annual trend assumed in the pricing period is 11.20%, when the annual trend from the experience period to the rating period is 7.4% annually.

32 The annual trend from the experience period to the rating period reflects differences in unit cost between the broader ConnectiCare experience and the Exchange network. 13. Provide detailed support for the -2.5% population morbidity adjustment assumed in the filing. The methodology to determine the population morbidity adjustment is included in the Actuarial Memorandum which accompanies the Uniform Rate Review Template. 14. Develop the incurred claims and earned premium on a pmpm basis prior to the Federal adjustments, then provide a step-by-step analysis of the adjustments in order to calculate the Federal MLR for rebate purposes. The expected medical loss ratio developed as follows: Benefit Expense: $ Revenue: $ Expected MLR: 77.3% For Federal Rebate purposes, two adjustments are made to Revenue: Premium Taxes: $ 8.20 (1.75% Revenue) FIT: $ (35% * Margin) Adjusted Revenue: $ Federal MLR: 80.5% ($362.11/$449.71) 15. Develop and identify the index rate for the rate filing in accordance with the Federal rating regulation. As illustrated on the Unified Rate Review Template(URRT), the Index Rate for the Projection Period is $ Explain the wide disparity between the proposed area factors in this filing and the proposed area factors in the individual market rate filing submitted by ConnectiCare Benefits, Inc. The differences between area factors for Small Group and Individual business reflect the following: Area factors for Small Group(SHOP) are to be based on the employer location where as the area factors for Individual were based on the subscriber location. Area factors for Small Group were developed based on a study of employer level Small Group experience, adjusted for anticipated utilization and unit cost differences in the Exchange market.

33 Area factors for Individual were developed based on a study of member level experience, reflecting the anticipated utilization and unit costs of associated with where members seek care.

34 ConnectiCare, Inc. & its Affiliates Exhibit - Baseline Medical expense, detail cost and Utilization (ConnectiCare Total Book of Business) YE YE YE YE YE Trend Trend Member Months 1,837,752 1,954,861 1,901, % -2.7% Util / 1000 Inpatient % 3.4% Outpatient 1, , , % 2.3% Professional 15, , , % 2.8% Subtotal Medical 17, , , % 2.7% Retail Pharmacy 9, , , % 0.4% Total 27, , , % 1.9% Unit Cost $ Inpatient 3,304 3,667 3, % 5.0% Outpatient % 8.6% Professional % -0.2% Subtotal Medical % 3.8% Retail Pharmacy % -1.3% Total % 3.2% Allowed PMPM Inpatient % 8.6% Outpatient % 11.2% Professional % 2.5% Subtotal Medical % 6.6% Retail Pharmacy % -0.9% Total % 5.1% Net PMPM Inpatient % 9.3% Outpatient % 10.5% Professional % 1.3% Subtotal Medical % 6.2% Retail Pharmacy % 1.7% Total % 5.5%

35 ConnectiCare, Inc. & Affiliates 2014 Exchange Rate Development - Small Group Claims incurred from Jan 2012 through Dec 2012 Paid through Mar 2013 including IBNR Total Claims from Rate Build Inpatient Outpatient Physician Rx Total Jan-12 - Dec-12 $ 11,053, $ 11,313, $ 15,466, $ 9,312, $ 47,146, Experience Period membership Claims PMPM from Rate Build Inpatient Outpatient Physician Rx Total Jan-12 - Dec-12 $ $ $ $ $ Medical Device Tax $ 0.19 Mandates $ 1.60 Maternity $ - Total to tie to Exhibit 1 - Pricing Build-up $

36 Response Exhibit Small Group Sum of TotalPaid MOP MOS , ,075 18,689 14,393 1,051 10, (176) (1,153) (392) (2,456) (3,907) , ,194 12,443 3,386 10, , , ,092 32,273 19,996 11, , , ,781 12,505 9,149 8,719 4, (54) , ,430 29,886 9,782 4,852 3, (1,710) , ,856 30,875 8,541 3,218 1,374 (82) , ,010 13,443 3,365 2,313 3, , ,122 8,916 3,904 8, , ,365 15,804 4, , ,171 23, , , , Grand Total 130, , , , , , , , , , , ,503

37 Response Exhibit Small Group Sum of TotalPaid MOS Grand Total (2,426) , (1,038) (43) (182) (192) 18 (280) - (158) , (562) , ,800 - (1) ,318 2,533 31,926 (15) (741) 19,898 11,439 9, (62) 186,762 27,302 16,066 4,703 30,755 (10,440) (828) , ,694 79,877 13,020 31,052 (10,109) 880 3,845 3,223 (73) (198) (86) 112, ,022 24,227 8,712 5,493 1,142 4,799 2, (86) 256, , ,330 12,849 6,436 4,217 4,701 (188) 6, , ,207 44,156 12,985 5,162 5,434 4,913 (1,661) 3, , , ,338 11,669 15,742 9,208 5, , , , ,157 30,879 18,424 11,060 1, , , ,107 33,784 11,880 10, , , ,484 40,595 45, ,939 1,120, , , ,622 1,293, , ,187 1,098, , , , , ,501 1,225,545 1,228,527 1,015,486 1,903,254 1,616,018 1,784,834 2,164,352 2,731,879

38 Response Exhibit Small Group Sum of TotalPaid MOS Grand Total (46) (125) (94) - - (22,604) - (0) (46) - (228) (306) - - (23) (232) (528) (90) 26 (492) (215) (195) 602 (8) 88 - (13) 1,356 4,786 (431) (58) ,324 1, , (108) (14) (2,098) 21, , , (171) (13) 5,581 (2,344) (1,337) 2, (1,894) (688) (156) - 3,570 12, (2,273) 8,901 1, , (22) (45) (12) 29,578 8,948 2,668 1,947 8, (92) 628 (2,157) 46,825 38,567 30,039 10,014 3,653 4,388 1, (2,200) 2,733 1, ,360 67,016 21,614 10,087 4,519 1,500 (745) (519) (1,956) 5,262 2,542 1,211 1,002, , ,704 21,653 2,788 3,365 5, ,421 1,477, ,409 57, ,128 75,833 21,720 4,023 5,067 3,510 (802) 6, ,811 1,418, , ,448 31,115 17,736 3,655 2,133 2,460 (572) (2,575) 891,055 1,373, ,398 40,941 22,500 35,654 13,928 6,744 (402) ,883 1,631, ,143 83,083 55,231 7,518 13,503 2,330 (25) 1,043,730 1,337, ,760 59,899 30,156 11,232 15,998 3, ,812 1,769, ,056 41,626 79,033 28,180 7, ,271 1,512, ,856 86,152 10,319 37, ,009 1,452, ,491 (59,250) 126, ,408 1,511, , ,127 1,228,862 1,273, , ,616 2,368,616 1,019,234 2,027,842 2,821,613 2,667,656 2,449,986 3,327,657 2,344,938 2,978,194 2,744,423 2,931,710 3,481,362 2,446,850 4,033,817 -

39 Response Exhibit Small Group Sum of TotalPaid MOS Grand Total Grand Total 384, , , , , , , , , , , , , , ,339 1,050,764 (95) 99 (222,675) 1,226,803 (674) (50) - 1,508,191 (43) 89-1,517,258 6, ,562, (56) - 2,325, (241) 271 2,274,278 (139) (96) (85) 2,208,401 16, ,126,732 (144) (112) (69) 2,469, (169) 3,132 2,751,341 (4,566) (1,034) 859 2,718,990 2,158 2,159 17,795 2,736,075 1,243 4,611 1,541 2,715, ,198 2,767,854 (103,632) 185,174 6,275 3,290,588 (135,930) 3,917 1,983 2,844,303 (35,411) (6,689) 1,454 2,457,400 38,020 17,813 23,459 2,932, , ,890 30,417 4,088,115 2,013, ,944 76,184 3,375,617 2,215,711 3,507, ,296 6,415,050 1,918,360 3,607,733 5,526,093 2,146,625 2,146,625 4,601,012 6,026,772 6,388,393 71,100,332

40 SERFF Tracking CCIC State: Connecticut Number: Filing Company: ConnectiCare Benefits, Inc. State Tracking Number: Company Tracking Number: TOI: HOrg02G Group Health Sub-TOI: HOrg02G.004E Small Organizations - Health Group Only - Other Maintenance (HMO) Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name: Objection Letter Status: Requesting Clarification Objection Letter Date: 07/03/2013 Respond By Date: 07/17/2013 Submitted Date: 07/03/ :59 AM Dear John Ducharme, Introduction: Thank you for your response to CID questions, please provide the following as a follow-up to ConnectiCare's responses: 1) The date for the current capital and surplus can't be 12/31/13, please provide as of date for the capital and surplus provided in the response. Capital and Surplus as of 3/31/2013 is $1,000,000. 2) Confirm that the annual trend from the experience period to the rating period is 7.38%. Yes, the net annual trend from the experience period to the rating period is 7.38%. As noted in our response to question #12 in the 1 st Objection Letter, the annual trend from the experience period to the rating period reflects differences in unit cost between the broader ConnectiCare experience and the Exchange network. 3) The Exchange fee has been defined as 1.35% of premium, if this is not the fee level in the filing, please adjust.

41 The final direction from the Exchange that 75% of their costs would be a passed onto the carriers came after our initial filing. The expected premium (prior to normalization) as illustrated in Exhibit I(Rating Build Up) will be lowered from $ to $ ) Exhibit I (Pricing Build-Up), includes ACA Fees as part of the benefit expense, these should be considered expenses and not benefits. Note, for purposes of the federal MLR calculation, they are subtracted from the premium, not added to the claims. Based on our revision as noted above (#3) and your comments to not include ACA fees as part of the benefit expense and to subtract these from the premium and not to add to the claims, we have re-calculated the Federal MLR for rebate purposes. The expected medical loss ratio developed as follows: Benefit Expense: $ Revenue: $ Expected MLR: 72.8% For Federal Rebate purposes, the following adjustments are made to Revenue: Premium Taxes: $ 8.17 (1.75% of Revenue) FIT: $ (35% * Margin) ACA Fees $ Exchange Admin $ 6.30 (1.35% of Revenue) Adjusted Revenue: $ Federal MLR(1): 79.5% ($339.87/$427.45) (1) We anticipate a credibility adjustment factor, based on 1828 combined projected life years and an average deductible less than $2,500, of 6.6%. This yields a Credibility Adjusted Medical Loss Ratio of 86.1% Thank you in advance for your continued cooperation. Conclusion: Sincerely, Paul Lombardo

42 SERFF Tracking #: CCIC State Tracking #: Company Tracking #: State: Connecticut Filing Company: ConnectiCare Benefits, Inc. TOI/Sub-TOI: HOrg02G Group Health Organizations - Health Maintenance (HMO)/HOrg02G.004E Small Group Only - Other Product Name: First Quarter 2014 Small Group Rate Filing (CBI) Project Name/Number: / Superseded Schedule Items Please note that all items on the following pages are items, which have been replaced by a newer version. The newest version is located with the appropriate schedule on previous pages. These items are in date order with most recent first. Schedule Item Replacement Creation Date Status Schedule Schedule Item Name Creation Date Attached Document(s) 04/24/2013 Supporting Document 04/24/2013 Supporting Document 04/24/2013 Supporting Document Actuarial Memorandum 07/21/2013 CompleteRateFilingSHOP_Final.pdf (Superceded) Actuarial Memorandum and Certifications 07/01/2013 Unified Rate Review Template 07/01/2013 PDF Pipeline for SERFF Tracking Number CCIC Generated 07/24/ :47 PM

43 Mailing Address: 175 Scott Swamp Road P.O. Box 4050 Farmington, CT May 17, 2013 Paul Lombardo, A.S.A., M.A.A.A. State of Connecticut Insurance Department Actuary, Life & Health Division P.O. Box 816 Hartford, CT Re: ConnectiCare Benefits, Inc. Small Group Exchange Product Rate Filing 1 st Quarter 2014 Dear Mr. Lombardo: Enclosed is a filing for the Small Group Exchange product for ConnectiCare Benefits, Inc.(CBI) Included is an actuarial memorandum that describes the proposed rates, including supporting documentation. This filing is applicable to all eligible Small Group Exchange members with rate effective dates in the 1 st quarter 2014, and includes applicable trend for future effective dates. CBI s rate filings reflect CBI s best efforts to understand and interpret the federal Patient Protection and Affordable Care Act (ACA) and existing applicable federal and state regulations and rules as of the date of these rate filings. CBI has developed these rate filings to the best of CBI s knowledge, information and belief as of the date of these rate filings. CBI s rate filings are based upon CBI s present understanding and interpretation of the ACA, of regulations promulgated under the ACA, and of Connecticut Exchange requirements. The federal and state regulatory environment since the passage of the ACA has been unclear, confusing and fluid. Federal agencies with jurisdiction under the ACA, particularly Health and Human Services (HHS), have published, and continue to publish, thousands of pages of regulations. Many of these regulations are complex, vague, incomplete and even contradictory. In a number of areas, regulations have not even been provided. Given the uncertainties of such an uncharted, untested regulatory environment, CBI reserves the right to withdraw or change all, or any portion, of these rate filings, at any point where, in CBI s judgment, a change or development in federal and/or state regulatory requirements or rules poses an actual or potential material adverse risk to CBI s business, or to the business of any CBI affiliated company. In the event that (1) any post-filing clarification of an existing federal and/or state standard, requirement or rule, (2) any post-filing publication of a new federal and/or state standard, requirement or rule, and/or (3) any post-filing change to an existing federal and/or state standard, requirement or rule, in CBI s judgment, does or shall pose an actual or potential material adverse risk to CBI s business, or to the business of any CBI affiliated company, CBI reserves the right to withdraw or change all, or any portion, of these rate filings. If you have any questions, comments, or need further information please feel free to contact me at Sincerely, Neil S. Kelsey, FSA, MAAA Vice President, Actuarial Services ConnectiCare, Inc. & Affiliates cc: G. Marszalek, Connecticare Inc. & Affiliates J. Ducharme, Connecticare Inc. & Affiliates /attachments LG Scott Swamp Road P.O. Box 4050 Farmington, CT

44 ConnectiCare Benefits, Inc. Actuarial Memorandum I. Overview The starting rates for this Small Group Exchange product have been developed as follows. The projected claim cost for this New Policy form (SHOP Exchange) was based on the existing non-grandfathered Small Group risk pool of Connecticare Insurance Company, Inc.(CICI), using the incurred period January 2012 through December 2012, paid thru March Appropriate completion factors were then applied and the claims were trended for 24 months. Adjustments were made for the anticipated morbidity of the 2014 Small Group Market population relative to the current Small Group market. Further adjustments were made to reflect the additional EHB benefits, including Pediatric Vision and Dental. Non-FFS costs and the impact of Health Care Reform are included. The projected claims were also normalized for average Age, Benefit and Area factors to develop proposed base rate. II. Supporting Detail Exhibit 1 Exhibit 2 Pricing Build-Up Summary of Rating Factors III. Miscellaneous Exhibits Pricing Manual Exhibit Also attached are the following pages to ConnectiCare Benefits, Inc. s Exchange Insured Pricing Manual. Section II.A.1 Premium Rate Formula Section II.B.1 Table 1 Starting Premium Rates Section II.B.2 Table 2 Benefit Relativity Factors Section II.B.3 Table 3 Trend Factors Section II.B.4 Table 4 Area Factors Section II.B.5 Table 5 Age Factors IV. Requirements due to Bulletin HC-81-2 HEALTH INSURANCE RATE FILING SUBMISSION GUIDELINES-REVISED 1. Historical experience from inception-to-date, this includes earned premium, paid claims, incurred claims, members, actual loss ratios and expected loss ratios (annual experience is appropriate for all years, monthly experience for the most recent two years). Not Applicable 2. A demonstration that the experience data submitted is consistent with the most recent financial statement filed with the Department pursuant to section 38a-53a of the Connecticut General Statutes. Not Applicable 3. Unit cost trend by broad service category, including actual unit cost data and impact of provider contract changes from experience period to rating period (medical and Rx separately). Not Applicable 4. Utilization trend by broad service category, including utilization data. Not Applicable

45 5. Impact of cost sharing leverage on trend. Not Applicable 6. Medical technology trend. Not Applicable 7. Benefit buy-down analysis and impact on trend. Not Applicable 8. Cost of each new benefit mandate or requirement due to change in law, separately identified, from the experience period to the rating period. This includes requirements of both state and federal law. No new benefit mandates or requirements due to change in law are included. Benefits comply with provisions of the Afforable Care Act, including Essential Health Benefits 9. A list of each component of the health care reform bill that impacted premium and the actual impact used in pricing for each component We have included the following Health Care Reform impacts in this filing: Patient Centered Outcomes Research Fee: This charge of $2 per covered life applies to policies issued or renewed between 10/1/2012 and 9/30/2013, and then is expected to be subject to adjustment for projected increases in National Health Expenditures per year for the years We have included $0.17 pmpm to cover this cost. Transitional Reinsurance Program: Recent guidance has put the cost of this $63 per capita. We have included a pmpm cost of $5.25 to cover this cost. Health Insurer Fee: We have included a pmpm cost of $9.05 to cover this cost. 10. A comparison of the proposed retention charge in the filing to the most recently filed statutory financial statement for the regulated entities separately Not Applicable 11. The current capital and surplus for the regulated entitiy for which this filing is being made Not Applicable 12. Claim lag triangles Not Applicable 13. A demonstration that demonstration that the increase requested in this rate filing will generate an expected medical loss ratio, for rebate purposes, that is consistent with the 80% prescribed by the federal law for individual health insurance. See Exhibit 1 Pricing Review for expected medical loss ratio for rebate purposes. Based on the the Rate Build Exhibit, we project that no rebate will be required for the 2014 year. 14. Actuarial certification signed by a Member of the American Academy of Actuaries (MAAA). See Attached

46 ConnectiCare Benefits, Inc. Connecticut Small Group Exchange Actuarial Certification 1 st Quarter 2014 Rate Filing I, Neil S. Kelsey, Vice President of Actuarial Services for ConnectiCare, Inc. & Affiliates, certify that I have reviewed ConnectiCare Benefits, Inc s Small Group Exchange New Policy Rate Filing for 2014 and that it is based upon commonly accepted actuarial assumptions and sound actuarial principles which are consistent with Connecticut Insurance Laws. The premium rates offered by ConnectiCare to new Small Group Exchange members are established on the basis of a community rate, adjusted to reflect the following classifications: Age age brackets of 1 year or more; Geographic Area not smaller than a county. Neil S. Kelsey, F.S.A., M.A.A.A. Vice President, Actuarial Services May 17, 2013 Date