Section 43.07 - Premium Rates(1) All base rates are subject to the Commissioner's disapproval if they do not meet the requirements of M.G.L. c. 176G, § 16.(2)Small Group Base Rates. Small group and individual base rates shall be submitted in accordance with M.G.L. c. 176J and 211 CMR 66.00: Small Group Health Insurance.(3)Large Group Base Rates. Each HMO shall submit proposed large group base rates for each product at least 90 days prior to their effective date(s).(4) The Commissioner shall notify the HMO if he or she determines that the HMO's submission is not complete and he or she shall identify the manner in which the submission is not complete. A submission shall not be deemed complete unless it contains: an actuarial opinion stating that the rates are neither excessive, inadequate, nor unfairly discriminatory, and that they are reasonable in comparison to the benefits offered; and any other information required by the Commissioner. As used in 211 CMR 43.07, "actuarial opinion" means a signed written statement by a member of the American Academy of Actuaries based upon the person's review of the appropriate records and of the actuarial assumptions and methods utilized by the HMO in establishing premium rates for applicable health benefit plans. The actuarial opinion also shall explain the method in which the submitted base rates were derived.(5) An HMO's submission shall contain the following documentation:(a) Three years of historic claims payment experience, including member months, shown separately for each year and differentiating among:1. Inpatient hospital care;2. Outpatient hospital care, with separate experience for: a. Radiological/laboratory/pathology costs; andb. All other outpatient costs;3. Health care provider charges for:a. Medical and osteopathic physicians;b. Mental health providers; andc. All other health care practitioners.5. Outpatient prescription drugs.(b) Three years of historic utilization experience, including member months, shown separately for each year and differentiating among:1. Inpatient hospital care;2. Outpatient hospital care, with separate experience for: a. Radiological/laboratory/pathology costs; andb. All other outpatient costs;3. Health care provider charges for:a. Medical and osteopathic physicians;b. Mental health providers; andc. All other health care practitioners.5. Outpatient prescription drugs.(c) Trend factors differentiating among:1. Inpatient hospital care;2. Outpatient hospital care, with separate experience for:a. Radiological/laboratory/pathology costs; andb. All other outpatient costs;3. Health care provider charges for:a. Medical and osteopathic physicians;b. Mental health providers; andc. All other health care practitioners.5. Outpatient prescription drugs.(d) The actuarial basis for all trend factors, including all relevant studies used to derive the factors;(e) All non-fee-for-service payments to providers, differentiating among: 1. Inpatient hospital care;2. Outpatient hospital care, with separate experience for:a. Radiological/laboratory/pathology costs; andb. All other outpatient costs;3. Health care provider charges for:a. Medical and osteopathic physicians;b. Mental health providers; andc. All other health care practitioners.5. Outpatient prescription drugs.(f) Administrative expense load factors, including an explanation of all changes to any administrative expense loads that were used in the prior period's base rates and where changes in administrative expenses may be caused by regulatory requirements or efforts to contain health care delivery costs;(g) Contribution-to-surplus load factors, including an explanation of all changes to the contribution-to-surplus load factor that are caused by regulatory requirements or other external events;(h) The anticipated loss ratios for the one year period during which the proposed base rates will be in effect;(i) A detailed description of all cost containment programs of the HMO to address health care delivery costs and the realized past savings and projected savings from all such programs; (j) If the HMO intends to pay similarly situated providers different rates of reimbursement, a detailed description of the bases for the different rates including, but not limited to: 1. Quality of care delivered;3. Geographic location at which care is provided;4. Intensity of services provided; and(k) Three years of historic base rates for each product.(6) If the Commissioner disapproves an HMO's proposed base rate(s), he or she shall notify the HMO in writing on the effective date of the proposed base rate(s) and he or she shall state the reason(s) for the disapproval.(7) Within 30 days of receipt of the disapproval, the HMO may request a hearing on the disapproval. The hearing shall be adjudicatory and de novo. The hearing shall commence within 45 days of the Commissioner's receipt of the HMO's request. The Commissioner shall issue a written decision within a reasonable period of time after the conclusion of the hearing.(8) In the event an HMO's proposed base rate(s) are disapproved, the HMO shall comply with the following: (a) The HMO shall not quote, issue, make effective, deliver or renew health benefit plans in the Commonwealth using disapproved base rates. The HMO shall instead, if applicable, quote, issue, make effective, deliver or renew all health benefit plans using base rates as in effect 12 months prior to the proposed effective date of the disapproved base rates. 211 CMR 43.07(6)(a) also applies to new health benefit plans whose base rates are disapproved. In calculating premiums, the HMO may apply any applicable, but not previously disapproved, base rate adjustment factors.(b) The HMO shall recalculate applicable rates for all affected health benefit plans and shall issue rate quotes and make all health benefit plans available through all applicable distribution channels, including intermediaries, the Commonwealth Health Insurance Connector Authority, licensed insurance producers and the HMO's website, in accordance with M.G.L. c. 176J and 211 CMR 66.00 as soon as practicable, but in no event more than ten calendar days after the HMO's receipt of the disapproval.(c) The HMO shall notify all affected policyholders of the disapproval within ten calendar days of the HMO's receipt of the disapproval.(d) The HMO shall promptly provide notice of all material changes to the evidence(s) of coverage to all affected individuals and groups in accordance with M.G.L. c. 176O, § 6(a) and 211 CMR 52.00: Managed Care Consumer Protections and Accreditation of Carriers.Amended by Mass Register Issue 1349, eff. 10/6/2017.