[Code of Federal Regulations]

[Title 42, Volume 2]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 42CFR403.256]



[Page 43]

 

                         TITLE 42--PUBLIC HEALTH

 

                    CHAPTER IV--CENTERS FOR MEDICARE

                          & MEDICAID SERVICES,

                        DEPARTMENT OF HEALTH AND

                             HUMAN SERVICES

 

PART 403_SPECIAL PROGRAMS AND PROJECTS--Table of Contents

 

                Subpart B_Medicare Supplemental Policies

 

Sec. 403.256  Loss ratio supporting data.



    (a) For purposes of requesting CMS certification under Sec. 

403.232, the insuring organization must submit the following loss ratio 

data to CMS for review--

    (1) A statement of why the policy is to be considered, for purposes 

of the loss ratio standards, an individual or a group policy.

    (2) The earliest age at which policyholders can purchase the policy.

    (3) The general marketing method and the underwriting criteria used 

for the selection of applicants to whom coverage is offered.

    (4) What policies are to be included under the one policy form, by 

the dates the policies are issued.

    (5) The loss ratio calculation period.

    (6) The scale of premiums for the loss ratio calculation period.

    (7) The expected level of earned premiums in the loss ratio 

calculation period.

    (8) The expected level of incurred claims in the loss ratio 

calculation period.

    (9) A description of how the following assumptions were used in 

calculating the loss ratio.

    (i) Morbidity.

    (ii) Mortality.

    (iii) Lapse.

    (iv) Assumed increases in the Medicare deductible.

    (v) Impact of inflation on reimbursement per service.

    (vi) Interest.

    (vii) Expected distribution, by age and sex, of persons who will 

purchase the policy in the coming year.

    (viii) Expected impact on morbidity by policy duration of--

    (A) The process used to select insureds from among those that apply 

for a policy; and

    (B) Pre-existing condition clauses in the policy.

    (b) For purposes of requesting continued CMS certification under 

Sec. 403.239(a), the insuring organization must submit the following to 

CMS--

    (1) A description of all changes in the loss ratio data, specified 

in paragraph (a) of this section, that occurred since CMS last reviewed 

the policy.

    (2) The past loss ratio experience for the policy, including the 

experience of all riders and endorsements issued under the policy. The 

loss ratio experience data must include earned premiums, incurred 

claims, and total policy reserves that the insuring organization 

calculates--

    (i) For all years of issue combined; and

    (ii) Separately for each calendar year since CMS first certified the 

policy.