As medical claims continue to rise, having rate increase filings on Medicare Supplement have never been more important. Below is a listing of Telos Actuarial’s top rate filing tips for 2024.
1. Know the market. Gathering competitive intelligence before you finalize your rating plan will help you understand if your rate proposal is an outlier and how your premiums will rank in the market after implementation.
2. Create efficient processes. Standardizing a core set of materials that can be used in multiple states so that they can be updated quickly.
3. File Early. Filing earlier than necessary gives you the best shot at success. Prioritize states with long review processes.
4. Stay current on state special requirements. Knowing each state’s unique rules can get filings processed quickly while not following these rules can result in delays.
5. Document assumptions. Having cleanly structured exhibits that document the development of key assumptions can help reviewers understand why your experience is unique.
6. Projected loss ratios should satisfy minimum requirements. All states have a minimum loss ratio requirement (most are 65%) and most states will expect credible experience to meet originally filed loss ratios. If your projected loss ratios are below these requirements, then you may be asking for too high of a rate increase.
7. Double check your rate exhibits. Current rate exhibits should match prior approved rates and proposed rates should be consistent with the current rates and requested rate changes. Ensuring accuracy can eliminate problems down the road.
8. Be mindful of data limitations. Immature data can look better than fully complete experience. If your data isn’t credible, then you may be able to combine it with other data on similar products.
9. Have realistic expectations. Understanding (and communicating) what amounts are likely to be approved is an important part of managing expectations and knowing when to accept counteroffers. No matter how poor the experience there are some states that will not approve anything above pre-defined amounts.
10. Develop a good set of contacts in each department. Having a good relationship with the reviewers can be helpful. In situations where you need approval to meet an implementation deadline, an open line of communication can be effective in securing a timely approval.
11. Tightly manage turnaround times. Having standard inquiry response times will keep your project on track to get filings approved on time. And as you approach approval cut-off dates, do not hesitate to reach out to reviewers.