Community Rating Analyzer is designed to help employee benefit brokers quickly model what renewal increases will be for employers who are moving to community rating fully insured plans.
History of Medical Insurance Rating (2-50 employees)
- Small group has historically been 2-50 employees, with specific underwriting guidelines
- Age banded rules: 7:1 ratio from oldest member to youngest member could be the rate spread charged by insurance carriers.
- Products were guaranteed issue with composite rate allowances allowed
- SIC Code
- Could add a rating load to certain ‘high’ utilizing groups (i.e, medical practices)
- Could discount certain industries that were either highly favorable demographically (age/gender) or were low health care utilizers
- Medical Experience Fact (PAST) could be applied to a group upon anniversary renewal, as well as upfront due to underwriting. Maximum rate ups applied, such as +67% to the base rates after going through underwriting.
- Medical Surcharge Factor (FUTURE) could be applied upon anniversary or upfront due to underwriting.
- Demographically, there could be differences applied for males and females due to the differences in claims experience between genders. (i.e, typical ages of 18-40 premiums for males were about 50%-75% of female rates due to utilization seen by insurance carriers.
History of Medical Insurance Rating (50-99 employees)
- Manual rating applied to groups to account for demographic makeup, industry code, experience, surcharge, etc.
- No maximum rate-up for insurers in this market segment.
- No guaranteed issue requirements, and thus carriers could decline to offer coverage to certain groups.
- Carriers could apply certain factors for positive experience of ‘healthy’ groups. (i.e, positive discrimination in the case of churches, office/clerical industries)
- Carriers could also apply certain factors for negative experience or poor participation groups. (i.e, high utilizing groups or groups with chronic claimants historically were given underwriting loads)