NOTICE OF HEARING

DOCKET NO. G2010-13

Proposed New Regulation 211 CMR 147.00 - Methodology for Calculating and Reporting Medical Loss Ratios (MLRs) of Health Benefit Plans

Pursuant to Massachusetts General Laws Chapter 30A and the authority granted to the Commissioner of Insurance by SECTION 50 of Chapter 288 of the Acts of 2010 ("SECTION 50"), a hearing will be held at the offices of the Division of Insurance, 1000 Washington Street, Boston, MA 02118-6200 on November 8, 2010 at 10:00 a.m. The purpose of this hearing is to afford all interested persons an opportunity to provide oral and/or written comment regarding the proposed permanent adoption of emergency regulation 211 CMR 147.00, Methodology for Calculating and Reporting Medical Loss Ratios (MLRs) of Health Benefit Plans.

The Division of Insurance ("Division") promulgated 211 CMR 147.00 on an emergency basis on October 1, 2010 pursuant to M. G. L. c. 30A, § 3 because SECTION 50 required the Division to establish a uniform methodology for calculating and reporting medical loss ratios of health benefit plans by health insurance carriers on or before October 1, 2010.

Pursuant to SECTION 68 of Chapter 240 of the Acts of 2010, a small business impact statement is required to be included in this Notice of Hearing. The Division estimates that 211 CMR 147.00 will be applicable to approximately 50 small businesses in the Commonwealth. This number includes all Massachusetts domestic property and casualty, life and health companies licensed for health insurance (all kinds), health maintenance organizations, Blue Cross and Blue Shield of Massachusetts, Inc., vision service plans and dental service plans. Third party administrators (TPAs) may be impacted by this regulation but, at this time, the Division neither regulates these entities nor has an accurate count of the number of TPAs in the Commonwealth. The Division estimates that the projected reporting, recordkeeping and other administrative costs required for compliance with 211 CMR 147.00 are negligible, as the regulation sets forth only the methodology by which medical loss ratios for health benefit plans will be calculated, rather than actual reporting requirements. 211 CMR 147.00 is drafted in a performance standards format because SECTION 50 requires the Division to establish the specific uniform methodology for calculating medical loss ratios for health benefit plans. The Division is not aware of any conflicts between 211 CMR 147.00 and existing Division regulations or existing regulations of another agency or department of the Commonwealth. The Division is not aware of whether 211 CMR 147.00 is likely to deter or encourage the formation of new businesses in the Commonwealth. The Division invites and encourages comments from small businesses in the Commonwealth concerning the final promulgation of 211 CMR 147.00, including the following: (1) whether 211 CMR 147.00 could establish less stringent compliance or reporting requirements for small businesses; (2) whether 211 CMR 147.00 could establish less stringent schedules or deadlines for compliance or reporting requirements for small businesses; (3) whether 211 CMR 147.00 could consolidate or simplify compliance or reporting requirements for small businesses; (4) whether 211 CMR 147.00 is likely to deter or encourage the formation of new businesses in the Commonwealth; and (5) what alternative regulatory methods, if any, may be used to minimize the adverse impact 211 CMR 147.00 on small businesses.

The proceedings concerning the permanent promulgation of emergency regulation 211 CMR 147.00 shall be designated as Docket No. G2010-13. Any person who wishes to provide oral comment concerning this regulation must file a Notice of Intent to Comment with the Docket Clerk no later than November 4, 2010. Persons wishing to submit written comments may do so until the record of the hearing is closed. All submissions must be sent to the Docket Clerk, Hearings and Appeals, Division of Insurance, 1000 Washington Street, Boston, MA 02118-6200, or by electronic mail to doidocket@state.ma.us and must refer to Docket No. G2010-13 in the subject line. Persons who do not file a Notice of Intent to Comment will be heard after those who notify the Division in advance of the hearing.

A copy of the emergency regulation is available from the Division and also is posted on its website at http://www.mass.gov/Eoca/docs/doi/Legal_Hearings/211_147.pdf pdf format of 211_147.pdf
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Dated October 14, 2010________________________________

Joseph G. Murphy

Commissioner of Insurance