744 Affordable Care Act; guidance for compliance submissions; notice 2013-03

INSURANCE DEPARTMENT

Affordable Care Act; Guidance for Compliance Submissions; Notice 2013-03

[43 Pa.B. 2245]
[Saturday, April 20, 2013]

 The Affordable Care Act (ACA)—that is, Patient Protection and Affordable Care Act (Pub. L. No. 111-148) and the Health Care and Education Reconciliation Act of 2010 (Pub. L. No. 111-152), collectively and as amended—sets forth market reform requirements for plan years beginning on or after January 1, 2014, for, individual and small group health insurance policies that provide ''major medical'' coverage, which is comprehensive health coverage, including PPO and HMO coverage. The ACA also sets forth requirements for a plan to be a qualified health plan (QHP), so that the plan may be certified for offering on an exchange. Finally, the ACA contains several provisions that will impact rate development.

 The Insurance Department (Department) provides the following guidance to insurance entities seeking to demonstrate compliance with the ACA relative to new or modified policy forms offered, issued or renewed in this Commonwealth. This guidance applies to new policy forms, as well as to policy forms for which an insurance entity (insurer) is not seeking to make any changes other than as necessary to make the policy form comply with the ACA. Further, it applies to any plan an insurer anticipates may be certified as a QHP.

 If an insurer is required under the act of December 22, 2011 (P. L. 614, No. 134) to file a policy form or policy form modification with the Department for prior approval, or if an insurer is intending to use after January 1, 2014, a form not required to be filed, that is, a ''product'' as contemplated by the ACA, the Commonwealth will accept as evidence of satisfying the ACA market reform requirements a ''Compliance Checklist and Certification,'' with the Market Reform portion of the Compliance Checklist filled out and the Certification executed by an authorized representative of the insurer, when the Compliance Checklist and Certification is substantially identical to the ''Compliance Checklist and Certification'' as Attachment A. Attachment A is also available on the Department's web site at www.insurance.pa.gov. File a form with each policy form or policy form modification being submitted.

 If an insurer is anticipating that any form/product along with its associated plans may be certified as a QHP and offered on an exchange, the Commonwealth will accept as evidence of satisfying the ACA QHP requirements a Compliance Checklist and Certification, with both the Market Reform and the QHP portions of the Compliance Checklist filled out and the Certification executed by an authorized representative of the insurer, when the Compliance Checklist and Certification is substantially identical to the ''Compliance Checklist and Certification'' as Attachment A. Attachment A is also available on the Department's web site. File a Compliance Checklist and Certification with each form/product and its associated plans being submitted. In addition to any Federally-facilitated exchange filing requirement (that is, HIOS), also include the QHP Application Templates in the SERFF filing, as instructed in SERFF.

 Further, with respect to the ACA rating requirements, including those amending the Public Health Service Act (PHSA) (42 U.S.C.A. §§ 201—300mm-61) and as further explained in Federal regulations, the Department requests that an actuarial memorandum be submitted as part of a rate filing for a product or plan subject to the ACA. In that actuarial memorandum, submitters are requested to:

 • State the anticipated loss ratio (see ACA § 1001, PHSA § 2718, noting also compliance with 31 Pa. Code § 89.83(b) (relating to rates)).

 • Specify compliance with the rating requirements in the ACA, that is, use of no rating factors other than: (i) age (premium band ratio not exceeding 3:1 and Federally approved standard age curve); (ii) tobacco use (premium band ratio not exceeding 1.5:1); (iii) family size (as specified in Federal regulation); and (iv) geography (State rating regions as Federally approved, listed in Attachment B, and also shown in map form on the Department's web site) (see ACA § 1201, PHSA § 2701).

 • Specify compliance with the single risk pool per market (individual or small group) requirement (see ACA § 1312).

 Additional information may be found in the general instructions in SERFF.

 Finally, while certain forms and rates referenced in this notice are subject to review and approval by the Department prior to use, the Department reminds filing entities that those forms and rates (and all forms and rates used in this Commonwealth) remain subject to, and must comply in all respects with, the Commonwealth's insurance laws and regulations, and the Department retains its ability to take after-use enforcement action and seek any available remedy for noncompliant forms or rates. An insurer will be responsible for assuring that all of its insureds are provided the full benefits provided by the ACA.

 Questions regarding this notice may be directed to Peter Camacci, Director, Bureau of Life, Accident and Health Insurance, Insurance Department, 1311 Strawberry Square, Harrisburg, PA 17120, [phone] or [e-mail].

MICHAEL F. CONSEDINE, 
Insurance Commissioner

Attachment A

 Pennsylvania Compliance Checklist and Certification (relating to market reform requirements and QHP certification requirements of the ACA)

Attachment B

 Geographic Rating Areas for Individual and Small Group Markets) (relating to market reform requirements of the ACA)

Attachment A

Compliance Checklist and Certification

 If an entity (the ''Company'') submits a form filing to the Commonwealth, or intends to use after January 1, 2014 a form not required to be filed, that is, a ''product'' as contemplated by the ACA, where that form/product is intended to comply with the market reform requirements or the market reform and qualified health plan requirements of the Affordable Care Act (ACA), the Commonwealth will accept as demonstrating compliance with those requirements a compliance checklist and certification submitted with your contract/ endorsement via SERFF as a Form Schedule document, substantially identical to this Compliance Checklist and Certification. These ACA requirements apply only to policies for health insurance coverage referred to as ''major medical'' in the statute, which is comprehensive health coverage, including PPO and HMO coverage. This checklist identifies the requirements for small group and individual plans, and, where specified, for grandfathered plans (coverage in effect prior to March 23, 2010). Refer to the relevant statute and any applicable regulations to ensure compliance. Complete each item applicable to your product category to confirm that diligent consideration has been given to each statutory requirement as to each plan encompassed by the identified form/product. Additionally, complete the QHP Requirements portion of this checklist for any policy form/product intended to be offered as a qualified health plan. (When submitting your filings electronically, bookmark the provision(s) in the form(s) that satisfy the requirement and identify the page/paragraph on this form.)

Company Name:

NAIC Number:

SERFF Tracking Number(s):

Type of Insurance (TOI):

Product Category:

______ Individual

______ Grandfathered Individual

______ Small Group

______ Grandfathered Small Group

Form Number(s) of Policy Being Submitted/Endorsed:

______________________________________________

______________________________________________

______________________________________________

Certification

 I hereby certify that the above-referenced policy form submission and related rate filing, required to be in compliance with the requirements of the Patient Protection and Affordable Care Act, P. L. 111-148, 124 Stat. 119, and the Health Care and Education Reconciliation Act of 2010, P. L. 111-152, 124 Stat. 1051, together and as modified referred to as the ACA, has been drafted or modified to be in compliance with the ACA and the regulations promulgated thereunder.

 I am aware that accident and health rates and forms may be disapproved, or otherwise give rise to remedies or sanctions, if they fail to comply with applicable law or regulations. See, e.g., 40 P. S. § 3801.304(b); 40 P. S. § 1171.5(a)(5) (prohibiting knowingly filing a false statement of material fact with a supervisory or public official).

 I hereby warrant that I have full, complete and final authority to attest to the representations of the Company as set forth herein, and do hereby attest that the representations set forth in this Compliance Checklist and Certification Form are true, correct and complete.

______   _________________
Date Name and Title of Authorized Repre-
          sentative of the Company

Compliance Checklist

 Please confirm, by checking the appropriate box, the compliance status of the above referenced form(s) with each specified ACA requirement.

 

Statutory Requirement	ACA/PHSA Section	Product Applicability	Certification of Compliance
Market Reforms
Elimination of Annual Limits	ACA § 1001/PHSA § 2711	√ Group   √ Individual   √ Grandfathered Group	[   ] Yes   [   ] No
Elimination of Lifetime Limits	ACA § 1001/PHSA § 2711	√ Group   √ Individual   √ Grandfathered Group   √ Grandfathered Individual	[   ] Yes   [   ] No
Prohibition of Rescission	ACA § 1001/PHSA § 2712	√ Group   √ Individual   √ Grandfathered Group   √ Grandfathered Individual	[   ] Yes   [   ] No
Preventive Health Services	ACA § 1001/PHSA § 2713	√ Group   √ Individual	[   ] Yes   [   ] No
Extension of Dependent Coverage	ACA § 1001/PHSA § 2714	√ Group   √ Individual   √ Grandfathered Group   √ Grandfathered Individual	[   ] Yes   [   ] No
Uniform Explanations of Coverage and Standardized Definitions	ACA § 1001/PHSA § 2715	√ Group   √ Individual   √ Grandfathered Group   √ Grandfathered Individual	[   ] Yes   [   ] No
Prohibition on Discrimination in Favor of Highly Compensated Individuals	ACA § 1001/PHSA § 2716	√ Group   √ Individual	[   ] Yes   [   ] No
Appeals Process	ACA § 1001/PHSA § 2719	√ Group   √ Individual	[   ] Yes   [   ] No
Patient Protections	ACA § 1001/PHSA § 2719A	√ Group   √ Individual	[   ] Yes   [   ] No
Prohibition of Pre-Existing Condition Exclusions	ACA § 1201/PHSA § 2704	√ Group   √ Individual   √ Grandfathered Group	[   ] Yes   [   ] No
Fair Premiums (limited rating factors)	ACA § 1201/PHSA § 2701	√ Group   √ Individual	[   ] Yes   [   ] No
Guaranteed Availability	ACA § 1201/PHSA § 2702	√ Group   √ Individual	[   ] Yes   [   ] No
Guaranteed Renewability	ACA § 1201/PHSA § 2703	√ Group   √ Individual	[   ] Yes   [   ] No
Prohibition on Discrimination Based on Health Status	ACA § 1201/PHSA § 2705	√ Group   √ Individual	[   ] Yes   [   ] No
Non-Discrimination in Health Care	ACA § 1201/PHSA § 2706	√ Group   √ Individual	[   ] Yes   [   ] No
Comprehensive Coverage	ACA § 1201/PHSA § 2707	√ Group   √ Individual	[   ] Yes   [   ] No
Prohibition on Excessive Waiting Periods	ACA §  1201/PHSA §  2708	√ Group   √ Individual   √ Grandfathered Group   √ Grandfathered Individual	[   ] Yes   [   ] No
Coverage for Participating in Approved Clinical Trials	ACA § 1201/PHSA § 2709	√ Group   √ Individual	[   ] Yes   [   ] No
Essential Health Benefits Package	ACA § 1302	√ Group   √ Individual	[   ] Yes   [   ] No
EHB Package—Pediatric	ACA § 1302	√ Group   √ Individual	[   ] Yes   [   ] No
EHB Package—Habilitative Services	ACA § 1302	√ Group   √ Individual	[   ] Yes   [   ] No
EHB Package—Prescription Drug Coverage	ACA § 1302	√ Group   √ Individual	[   ] Yes   [   ] No
Requirements Related to Cost-Sharing	ACA § 1302	√ Group   √ Individual	[   ] Yes   [   ] No
Actuarial Value/Metal Level	ACA § 1302	√ Group   √ Individual	[   ] Yes (included in binder)   [   ] No
Child-Only Plan	ACA § 1302(f)	√ Group   √ Individual	[   ] Yes   [   ] No
Special Rules Relating to Coverage of Abortion Services	ACA § 1303	√ Group   √ Individual	[   ] Yes   [   ] No
Mental Health Parity	ACA § 1563/PHSA § 2726	√ Group   √ Individual	[   ] Yes   [   ] No
Health Insurance Reform Regulatory Requirements for the Group Health Insurance Market	45 C.F.R. Subtitle A Subchapter B Part 146	√ Group   √ Grandfathered Group (as applicable)	[   ] Yes   [   ] No
Health Insurance Reform Regulatory Requirements for the Group and Individual Health Insurance Markets	45 C.F.R. Subtitle A Subchapter B Part 147	√ Group   √ Individual   √ Grandfathered Group (as applicable)   √ Grandfathered Individual (as applicable)	[   ] Yes   [   ] No
Health Insurance Reform Regulatory Requirements for the Individual Health Insurance Market	45 C.F.R. Subtitle A Subchapter B Part 148	√ Individual   √ Grandfathered Individual (as applicable)	[   ] Yes   [   ] No
Health Insurance Reform Regulatory Requirements— Essential Health Benefits	45 C.F.R. Subtitle A Subchapter B Part 156 Subpart B	√ Group   √ Individual	[   ] Yes   [   ] No
QHP Requirements
Definition of Qualified Health Plan	ACA § 1301	√ Group   √ Individual	[   ] Yes   [   ] No
Marketing Requirements	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes   [   ] No
Network Adequacy Requirements	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes—Submitted to Dept. of Health directly or via Excel upload to SERFF on: ______   [   ] No
Essential Community Providers Requirement	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes   [   ] No
Accreditation Requirement	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes-Accred. Body: NCQA/URAC Date of Accred.: _____   [   ] No
Quality Improvement Strategy	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes   [   ] No
Uniform Enrollment Form	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes   [   ] No
Standard Format for Health Benefit Options	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes   [   ] No
Quality Measures for Performance Information	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes   [   ] No
Pediatric Quality Reporting measures	ACA § 1311(c)(1)	√ Group   √ Individual	[   ] Yes   [   ] No
Mental Health Parity	ACA § 1311(j)	√ Group   √ Individual	[   ] Yes   [   ] No
Exchange Functions: Certification of Qualified Health Plan Regulations	45 C.F.R. Subtitle A Subchapter B Part 155 Subpart K	√ Group   √ Individual	[   ] Yes   [   ] No
Exchange Health Insurance Issuers Standards Regulations	45 C.F.R. Subtitle A Subchapter B Part 156	√ Group   √ Individual	[   ] Yes   [   ] No

Attachment B

Pennsylvania Geographic Rating Areas (Individual and Small Group Markets)

(listing counties alphabetically in each ''Federal System'' Rating Area ID)

 Rating Area 1—Clarion, Crawford, Erie, Forest, McKean, Mercer, Venango, Warren

 Rating Area 2—Cameron, Elk, Potter

 Rating Area 3—Bradford, Carbon, Clinton, Lackawanna, Luzerne, Lycoming, Monroe, Pike, Sullivan, Susquehanna, Tioga, Wayne, Wyoming

 Rating Area 4—Allegheny, Armstrong, Beaver, Butler, Fayette, Greene, Indiana, Lawrence, Washington, Westmoreland

 Rating Area 5—Bedford, Blair, Cambria, Clearfield, Huntingdon, Jefferson, Somerset

 Rating Area 6—Centre, Columbia, Lehigh, Mifflin, Montour, Northampton, Northumberland, Schuylkill, Snyder, Union

 Rating Area 7—Adams, Berks, Lancaster, York

 Rating Area 8—Bucks, Chester, Delaware, Montgomery, Philadelphia

 Rating Area 9—Cumberland, Dauphin, Franklin, Fulton, Juniata, Lebanon, Perry

[Pa.B. Doc. No. 13-744. Filed for public inspection April 19, 2013, 9:00 a.m.]