OAR 836-053-0063: Rating for Nongrandfathered Small Group Plans

The following provisions relating to rating apply to nongrandfathered health benefit plans offered to small employers: (1) A small employer carrier shall file a single geographic average rate for each nongrandfathered health benefit plan that is offered to small employers within a geographic area and for each category of family composition. The geographic rate must be determined on a pooled basis and the pool shall only include all of the carrier's nongrandfathered business in the small employer market. (2) There shall be one rating class for each small employer carrier. All nongrandfathered small employer health benefit plans of the carrier shall be rated in that class. A rating of a health benefit plan is subject to adjustments reflecting age, tobacco use and differences in family composition. (3) The variation in geographic average rates among different nongrandfathered small employer health benefit plans offered by a carrier must be based solely on objective differences in plan design or coverage. The variation shall not include differences based on the risk characteristics or claims experience of the actual or expected enrollees in a particular plan. (4) A small employer carrier shall file its geographic average rates for nongrandfathered small employer health benefit plans in accordance with the rate filing requirements of OAR 836-053-0910. (5) A small employer carrier shall assess administrative expenses in a uniform manner to all nongrandfathered small employer health benefit plans. Administrative expenses shall be expressed as a percentage of premium and the percentage may not vary with the size of the small employer. (6) Nongrandfathered small group plans shall be rated within the following geographic areas comprising counties as follows: (a) Area 1 shall include: Clackamas, Multnomah, Washington and Yamhill. (b) Area 2 shall include: Benton, Lane and Linn. (c) Area 3 shall include: Marion and Polk. (d) Area 4 shall include: Deschutes, Klamath and Lake. (e) Area 5 shall include: Clatsop, Columbia, Coos, Curry, Lincoln and Tillamook. (f) Area 6 shall include: Baker, Crook, Gilliam, Grant, Harney, Hood River, Jefferson, Malheur, Morrow, Sherman, Umatilla, Union, Wallowa, Wasco and Wheeler. (g) Area 7 shall include: Douglas, Jackson and Josephine. (7) For nongrandgathered small group plans, a small employer carrier may use the same geographic average rate for multiple rating areas. (8) Premium rates for nongrandfathered small employer health benefit plans: (a) For each group, shall total the sum of the product of the base rate and the applicable factors in section (9) of this rule for each employee and dependent 21 years of age and older and the sum of the product of the base rate and the applicable factors in section (9) of this rule for each of the three oldest dependent children under the age of 21 within each family in the group. (b) Shall be allocated to an employee by dividing the total premium described in subsection (a) of this section by the sum of the products of the number of employees and the applicable tier factors specified in paragraphs (A) through (D) of this subsection, and multiplying the quotient by the applicable tier factor for the employee as specified in paragraphs (A) through (D) of this subsection. The tier factors are: (A) 1.00 for an employee only; (B) 1.85 for an employee and one or more children age 25 or younger; (C) 2.00 for an employee and spouse; and (D) 2.85 for an employee and family. (9) The variations in rates described in this rule may be based on one or more of the following factors as determined by the carrier: (a) The ages of enrolled employees and their dependents according to Exhibit 1 to this rule. Variations in rates based on age may not exceed a ratio of three to one. (b) A tobacco use factor of no more than 1.5 times the non-tobacco use rate for persons 18 years or older except that the factor may not be applied when the person is enrolled in a tobacco cessation program. (c) The level at which enrolled employees and their dependents engage in health promotion, disease prevention or wellness programs.