You asked what information health insurers and HMOs must report to the Insurance Department, what of that is confidential, how Connecticut's annual report supplement filing requirements compare to Maine's, and if any states require health insurers to report loss ratios.

SUMMARY

The law requires health insurers and HMOs to report certain financial and non-financial information to the insurance department, as detailed in this report. A limited amount of such information is confidential, including risk-based capital reports, holding company reports, and certain plans for handling insolvency.

Connecticut requires insurers and HMOs to file annual financial reports, as do all states. Loss ratio data is included in the financial reports. Thus, all states require loss ratio reporting.

The National Association of Insurance Commissioners (NAIC) develops the standard financial reporting forms. Connecticut follows the NAIC guidelines and requires insurers and HMOs to file NAIC forms and supplement reports. Some states go further and develop additional state supplement forms. For example, Maine requires an “annual report supplement” form detailing medical claim data and other information. Connecticut does not require a similar additional supplement.

REPORTING REQUIREMENTS

Financial Reporting

Health insurers and HMOs must report the following financial items to the Connecticut Insurance Department, according to the department's Financial Analysis Division:

1. quarterly financial statements (CGS § 38a-53, Conn. Agencies Regs. § 38a-53-1, et seq. );

2. annual financial statement (including all required supplements) (CGS § 38a-53, Conn. Agencies Regs. § 38a-53-1, et seq. );

3. quarterly and annual reports of HMO's compliance with CGS § 38a-193(5), including net worth requirements, if out-of-network benefits are provided (CGS § 38a-193(5));

4. audited financial statement (CGS § 38a-54, Conn. Agencies Regs. § 38a-54-1, et seq. );

5. risk-based capital report (CGS §§ 38a-72(d) & 38a-193 and Conn. Agencies Regs. §§ 38a-72-1, et seq. & 38a-193-1, et seq. );

6. holding company report (CGS §§ 38a-135 & 38a-137);

7. plan for member participation in HMO policy and operation matters (CGS § 38a-179(b)); and

8. plan for handling insolvency (CGS §§ 38a-193(d) & 38a-479aa(b))

The following items are confidential: (1) risk-based capital report, (2) holding company report, and (3) if an affiliated transaction, a plan for handling insolvency.

Non-Financial Reporting

Health insurers and HMOs must file policy forms with the department for approval (CGS §§ 38a-299, 38a-481, and 38a-513). In addition, they must file the below information annually with the department, according to the department's Life and Health Division. The information is not confidential.

Small group carriers. Small group carriers have to file actuarial and market data information (CGS §§ 38a-564(7) & 38a-564(28)).

Managed care organizations. Managed care organizations (MCOs) must file, pursuant to CGS § 38a-478c:

1. the ratio of the number of complaints received to the number of enrollees;

2. utilization review statistics;

3. the percent of employers that did not renew their contracts within the prior 12 months;

4. Health Plan Employer Data and Information Set (HEDIS) (if a company does not provide this information to the National Committee for Quality Assurance, it must file equivalent data with the department);

5. model provider contracts;

6. provider credentialing procedures;

7. a statement of the types of financial arrangements with providers; and

8. information the department needs to complete the consumer report card required by CGS § 38a-478l, which may include:

(a) general company characteristics (e. g. , profit or nonprofit status, address and telephone number, the length of time it has been licensed, its number of enrollees, and whether it has received any national or regional accreditation);

(b) medical loss ratio or percentage of the total premium revenues spent on medical care compared to administrative costs and plan marketing;

(c) how it compensates health care providers;

(d) a description of services;

(e) the number of primary care physicians and specialists;

(f) the number and nature of participating preferred provider networks; the distribution and number of hospitals by county;

(g) utilization review information;

(h) medical management information, including the provider-to-patient ratio by primary care provider and specialty care provider;

(i) quality assurance information;

(j) whether it markets to individuals and Medicare recipients;

(k) the number of hospital days per thousand enrollees; and

(l) the average length of hospital stays for specific procedures.

Medicare Supplement. Medicare supplement carriers must file refund calculations and a report of instances where more than one Medicare supplement policy has been issued. Also, carriers must file Medicare Supplement rates (CGS § 38a-474 and Conn. Agencies Regs. § 389a-474-1, et seq. ).

Long Term Care. Long term care carriers must file a report of any lapse, recision, or replacement of a policy during the prior year (Conn. Agencies Regs. 38a-501-23).

MAINE ANNUAL REPORT SUPPLEMENT

Maine law requires insurers and HMOs to file an “annual statement supplement” by March 1 each year. This is a state-created disclosure form that, by law, must “provide the public with general, understandable, and comparable financial information relative to the in-state operations and results of the companies. ” The information must include medical claims expense, administrative expense, and underwriting gain for each line segment of the market in which the company participates. The data must contain sufficient detail for the public to understand the components of cost incurred as well as the annual cost trends of these companies (Me. Rev. Stat. Ann. tit. 24-A, § 423-D). A copy of the required form, referred to as Rule 945, is enclosed. It requires detailed information on members and contracts, revenue, expenses, and utilization of services, as well as general company data.

Connecticut law does not require a similar supplement. Connecticut requires carriers to file an annual statement prepared in accordance with NAIC instructions. The filing includes NAIC supplements, but these do not appear to mirror Maine's Rule 945 annual report supplement.

LOSS RATIO

Loss ratio is claims divided by premiums. The numerator can be claims incurred or paid, and the denominator can be earned or written premiums, depending on the loss ratio purpose (www. insweb. com).

Connecticut. Health insurers and HMOs report loss ratio information to the department through their financial reporting. In addition, specific statutes require loss ratio to be reported in certain circumstances. (See CGS §§ 38a-478c(4)(B)(3), 38a-481(e), 38a-495a, 38a-501, and 38a-565(b)(4)).

Other States. All states require health insurers and HMOs to file annual financial reports. Since the financial reports contain loss ratio data, all states require the reporting of loss ratio data, according to NAIC's financial unit. Most states also have loss ratio statutory requirements similar to Connecticut's.

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