PA 09-46—sSB 46

Insurance and Real Estate Committee

AN ACT CONCERNING THE CONSUMER REPORT CARD

SUMMARY: This act requires the (1) insurance commissioner to include in the annual health insurance consumer report card the medical loss ratio of each insurer and HMO included in the report and (2) Insurance Department to prominently display a link to the report card on its website. The act requires each health insurer or HMO to disclose its medical loss ratio, as reported in the most recent consumer report card, in writing to a person when he or she applies for coverage. (In effect, this provision only applies to HMOs and the 15 largest insurers that offer managed care plans in Connecticut, as these are the companies included in the report by law. )

The act defines “medical loss ratio” as the ratio of incurred claims to earned premiums for the prior calendar year for managed care plans issued in Connecticut. It limits “claims” to medical expenses for services and supplies provided to enrollees, excluding expenses for stop loss coverage, reinsurance, enrollee educational programs, and other cost containment programs or features.

It also applies this definition to the laws requiring a managed care organization (MCO) to give certain information, including its medical loss ratio, to the commissioner and plan enrollees. Prior law described an MCO's medical loss ratio as the “percentage of the total premium revenue spent on medical care compared to administrative costs and plan marketing. ” The act also changes the date by which an MCO must annually report to the insurance commissioner from May 1 to January 1.

The act names the report card the “Consumer Report Card on Health Insurance Carriers in Connecticut” and changes, from March 15 to October 15, the date by which the insurance commissioner, after consultation with the public health commissioner, must annually develop and distribute it.

EFFECTIVE DATE: October 1, 2009

BACKGROUND

Managed Care Organizations

The law defines an MCO as an insurer, HMO, hospital or medical service corporation, or other organization delivering, issuing, renewing, or amending individual or group health managed care plans in Connecticut.

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