HB5417 H B&I AM #1

McMinn 3919

The Committee on Banking and Insurance moved to amend the bill after the enacting clause by striking everything and inserting in lieu thereof:

§33-63-1. Title.

This act shall be known and cited as the "West Virginia Medical Loss Ratios for Dental (DLR) Health Care Services Plans Act."

§33-63-1. Purpose.

The purpose of this act is to provide for transparency of the expenditure of dental health care plan premiums, and to require annual reports and remediation if the dental loss ratio falls below a certain percentage.

§33-63-3. Definitions.

For purposes of this article:

(a) "Commissioner" means the Insurance Commissioner of this state.

(b) "Dental Carrier" or "carrier" means a dental insurance company, dental service corporation, or dental plan organization authorized to provide dental benefits, or a health benefits plan that includes coverage for dental services.

(c) "Dental health care service plan" or "plan" means any plan that provides coverage for dental health care services to enrollees in exchange for premiums and does not include plans under Medicaid or CHIP.

(d) "Dental loss ratio" or "DLR" means the percentage of premium dollars spent on patient care as calculated pursuant to subdivision (1) of this subsection.

(1) The dental loss ratio is calculated by dividing the numerator by the denominator where:

(A) the numerator is the sum of the amount incurred for clinical dental services provided to enrollees, the amount incurred on activities that improve dental care quality, and other incurred claims as defined at 45 CFR 158.140(a); and

(B) The denominator is the total amount of premium revenue, excluding federal and state taxes, licensing and regulatory fees pad, nonprofit community expenditures as defined at 45 CFR 158.162(c), and any other payments required by federal law.

(2) The Commissioner shall define by legislative rule, by July 1, 2024:

(A) Expenditures for clinical dental services;

(B) activities that improve dental care quality: Provided, that activities conducted by an issuer intended to improve dental care quality may not exceed five percent of net premium revenue; and

(C) Overhead and administrative cost expenditures.

(3) The definitions promulgated by legislative rule pursuant to this section shall be consistent with similar definitions that are used for the reporting of medical loss ratios by carriers offering health benefit plans in the state. Overhead and administrative costs may not be included in the numerator.

§33-63-4. Transparency of patient premium expenditures.

(a) Any carrier that issues, sells, renews, or offers a specialized dental health care service plan contract shall file a Dental Loss Ratio (DLR) annual report with the commissioner that is organized by market and product type and contains the same information required in the 2013 federal Medical Loss Ratio (MLR) Annual Reporting Form (CMS-10418). The filing shall also report additional data that includes the number of enrollees, the plan cost-sharing and deductible amounts, the annual maximum coverage limit, and the number of enrollees who meet or exceed the annual coverage limit.

(b) The DLR reporting year shall be for the fiscal year during which dental coverage is provided by the plan. All terms used in the DLR annual report shall have the same meaning as used in the federal Public Health Service Act (42 U.S.C. Sec. 300gg-18), Part 158 (commencing with 158.101) of Title 45 of the Code of Federal Regulations, and Section 1367.003.

(c) If data verification of the carrier's representations in the DLR annual report is deemed necessary, the commissioner shall provide the carrier with a notification. Following the receipt of the notification, the carrier shall have 30 days to submit any additional information required by the commissioner.

(d) By January 1 of the year after the commissioner receives the dental loss ratio information collected pursuant to subsection (a) of this section, the commissioner shall make the information, including the aggregate dental loss ratio and other data reported pursuant to this section, available to the public in a searchable format on a public website that allows members of the public to compare dental loss ratios among carriers by plan type by:

(1) Posting the information on the division's website; or

(2) Providing the information to the administrator of an all-payer health claims database. If the Commissioner provides the information to the administrator, the administrator shall make the information available to the public in a format determined by the commissioner.

(e) The commissioner shall report the data in this section to the Legislature.

§33-63-5. Excess revenue rebate.

(a) The commissioner shall aggregate dental loss ratios for each carrier by year pursuant to Section 4 for each market segment in which the carrier operates. The commissioner shall calculate an average dental loss ratio for each market segment using aggregate data for a 3-year period including data for the most recent dental loss ratio reporting year and the data for the two prior dental loss ratio reporting years.

(1) Newer experience shall be subject to reporting standards at 45 CFR 158.121

(b) The Commissioner shall calculate an average dental loss ratio for each market segment using the data pursuant to subsection 5(a), identify as outliers dental plans that fall outside 1 standard deviations of the average dental loss ratio, and report those plans to the Legislature consistent with the manner set forth in subsections 4(e) and 4(d) above.

(1) A carrier shall not be considered an outlier if its DLR in a market segment is within three percentage points of the average dental loss ratio. A higher threshold may be set in unique circumstances as determined reasonable by the commissioner.

(c) The commissioner shall investigate those carriers that report a DLR lower than one standard deviations from the mathematical average, and may take remediation or enforcement actions against them, including ordering such carriers to rebate, in a manner consistent with 45 C.F.R. Part 158(B) of the ACA all premiums paid above such amounts that would have caused said carrier to have achieved the mathematical average of the data submitted in a given year for a given market segment.

(d) The report in subsection (b) shall be organized to show year-over-year changes in a carrier's outlier status relative to meeting the one standard deviation outlier standard at subsection (b). If the DLR for a carrier in a market segment does not increase and remains an outlier as defined in subsection (b) after two consecutive years, barring unique circumstances as determined reasonable by the commissioner, the carrier shall be subject to a minimum DLR percentage by market segment. The commissioner shall promulgate rules establishing the DLR percentage based on, at minimum, the average of existing carrier loss ratios by market segment in the state to be effective no sooner than 42 months after a carrier is determined to be an outlier as defined in this section.

(e) A carrier subject to remediation in subsections (c) and (d) of this section shall provide any rebate owing to a policyholder no later than September 1, 2025, of the fiscal year following the year for which the ratio described in subsection (a) of this section was calculated. The commissioner may establish alternatives to direct rebates to include premium reductions in the following benefit year.

(f) The commissioner may promulgate rules that create a process to identify carriers that increase rates in excess of the percentage increase of the latest dental services Consumer Price Index as reported through the U.S. Bureau of Labor Statistics.

§33-63-5. Rulemaking.

(a) On or before July 28, 2024, the commissioner shall propose rules for Legislative approval in accordance with the provisions of §29A-3-1 et seq. of this code to effectuate the provisions of this article.

(b) The commissioner may, as necessary, promulgate emergency rules pursuant to the provisions of §29A-3-15 of this code to effectuate the provisions of this article.

Adopted

Rejected