Michigan Laws 500.3406ee – Health insurance policies; individual or small group markets; mandatory levels of coverage; actuarial value; compliance; applicability
Current as of: 2024 | Check for updates
|
Other versions
Terms Used In Michigan Laws 500.3406ee
- Department: means the department of insurance and financial services. See Michigan Laws 500.102
- Health insurance policy: means an expense-incurred hospital, medical, or surgical policy, certificate, or contract. See Michigan Laws 500.608
- Insurer: means an individual, corporation, association, partnership, reciprocal exchange, inter-insurer, Lloyds organization, fraternal benefit society, or other legal entity, engaged or attempting to engage in the business of making insurance or surety contracts. See Michigan Laws 500.106
- state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
(1) An insurer that delivers, issues for delivery, or renews in this state in the individual or small group market a health insurance policy shall offer health insurance policies that provide at least 1 of the following levels of coverage:
(a) Coverage designed to provide benefits actuarially equivalent to 60% of the full actuarial value of the benefits provided under the policy.
(b) Coverage designed to provide benefits actuarially equivalent to 70% of the full actuarial value of the benefits provided under the policy.
(c) Coverage designed to provide benefits actuarially equivalent to 80% of the full actuarial value of the benefits provided under the policy.
(d) Coverage designed to provide benefits actuarially equivalent to 90% of the full actuarial value of the benefits provided under the policy.
(2) For plan years beginning after the effective date of the amendatory act that added this section, the allowable variation in the actuarial value of a health insurance policy that does not result in a material difference in the true dollar value of the health insurance policy is the de minimis variation as described in 45 C.F.R. § 156.140.
(3) For purposes of determining compliance with subsections (1) to (2), an insurer described in subsection (1) must use the actuarial calculator developed and made available by the federal department of health and human services for the applicable plan year. Subject to subsection (4), if the federal department of health and human services has not developed and made available the calculator, an insurer described in subsection (1) may use the most recently issued calculator. If a health insurance policy’s design is not compatible with the calculator, the insurer must submit an actuarial certification from an actuary, who is a member of the American Academy of Actuaries, using 1 of the following methodologies:
(a) Calculate the health insurance policy’s actuarial value by:
(i) Estimating a fit of its plan design into the parameters of the calculator.
(ii) Having the actuary certify that the plan design fits appropriately in accordance with generally accepted actuarial principles and methodologies.
(b) Use the calculator to determine the actuarial value for the health insurance policy provisions that fit within the calculator parameters and have the actuary calculate and certify, in accordance with generally accepted actuarial principles and methodologies, appropriate adjustments to the actuarial value identified by the calculator, for plan design features that deviate substantially from the parameters of the calculator.
(4) The calculation methods described in subsection (3) may include only in-network cost-sharing, including multitier networks.
(5) This section does not apply to a short-term or 1-time limited duration policy or certificate of not longer than 6 months as described in section 2213b, a grandfathered plan as that term is defined in 45 C.F.R. § 147.140, or a catastrophic plan as described in 45 C.F.R. § 156.155.