WSR 20-20-123
PROPOSED RULES
OFFICE OF THE
INSURANCE COMMISSIONER
[Insurance Commissioner Matter R 2020-12—Filed October 6, 2020, 11:55 a.m.]
Original Notice.
Preproposal statement of inquiry was filed as WSR 20-15-129.
Title of Rule and Other Identifying Information: Health coverage supplementing Medicare Part D provided through a federally authorized employer group waiver plan.
Hearing Location(s): On November 10, 2020, at 9:00 a.m. Remote access information for public testimony will be made available at https://www.insurance.wa.gov/medicare-part-d-r-2020-12. Due to the COVID-19 public health emergency, this hearing will be held via Zoom.
Date of Intended Adoption: November 11, 2020.
Submit Written Comments to: Bode Makinde, P.O. Box 40260, Olympia, WA 98504-0260, email rulescoordinator@oic.wa.gov, fax 360-586-3109, by November 10, 2020.
Assistance for Persons with Disabilities: Contact Melanie Watness, phone 360-725-7013, fax 360-586-2023, TTY 360-586-0241 or 360-725-7087, email MelanieW@oic.wa.gov, by November 9, 2020.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The proposed rules will seek to define product requirements and filling submission requirements for these new plans.
Reasons Supporting Proposal: The legislature recently passed SSB 6051 that permits insurers to offer Medicare Part D wrap-around coverage, which is a new type of plan in the market.
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: Mike Kreidler, insurance commissioner, governmental.
Name of Agency Personnel Responsible for Drafting: Bode Makinde, P.O. Box 40260, Olympia, WA 98504-0260, 360-725-7041; Implementation: Melanie Anderson, P.O. Box 40255, Olympia, WA 98504-0255, 360-425-7156; and Enforcement: Toni Hood, P.O. Box 40255, Olympia, WA 98504-0255, 360-725-7264.
A school district fiscal impact statement is not required under RCW
28A.305.135.
A cost-benefit analysis is required under RCW
34.05.328. A preliminary cost-benefit analysis may be obtained by contacting Bode Makinde, P.O. Box 40260, Olympia, WA 98504-0260, phone 360-725-7041, fax 360-586-2023, TTY 360-725-7087, email
bodem@oic.wa.gov.
This rule proposal, or portions of the proposal, is exempt from requirements of the Regulatory Fairness Act (RFA) because the proposal:
Is exempt under RCW
19.85.025(3) as the rule content is explicitly and specifically dictated by statute; and rules adopt, amend, or repeal a procedure, practice, or requirement relating to agency hearings; or a filing or related process requirement for applying to an agency for a license or permit.
Is exempt under RCW
34.05.310 (4)(e), WAC 284-43-6560.
Explanation of exemptions: WAC 284-43-6560 adopts the requirements as dictated by SSB 6051.
The proposed rule does not impose more-than-minor costs on businesses. Following is a summary of the agency's analysis showing how costs were calculated.
Section 1 - Background: An EGWP, or "Egg Whip" as it is called, is a form of Medicare Advantage (MA) plan offered by very large employers and allows their group retirees to receive their MA benefits through the group. Part of this EGWP will generally include the Medicare Part D prescription drug component, which has a variety of cost-sharing limitations. The plans which are the subject of this rule making are stand-alone prescription drug plans which supplement this EGWP Part D coverage and pay for some or all of the remaining cost sharing. These plans are relatively rare in the marketplace.
Section 2 - Rule groups and their status relative to RFA analysis:
Rule Group | Content | WAC | Exemption Category |
(6) All stand-alone prescription drug plans which exclusively supplement a Medicare Part D employer group waiver plan and modification of a contract form or rate must be filed before the contract form is offered for sale to the public and before the rate schedule is used. | Add text | WAC 284-43-6560 | RCW 34.05.310 (4)(e) (dictated by statute). This definition is necessary to implement the new law. RCW 34.05.310 (4)(g)(i) (relating to agency hearings; or (ii) process requirements for applying to an agency for a license or permit). |
Section 3 - Cost of compliance/minor cost threshold: The insurers that are affected by this rule are not small businesses as defined in RCW
19.85.020(3). The OIC applied a default cost of compliance (
$100) when analyzing whether the rules would have a disproportionate impact on small businesses as defined in RCW
19.85.020(3). Below are calculations for minor cost thresholds across all impacted industries based on the best analogous NAICS types. For these reasons, the proposed rules do not impose more than minor costs on businesses as defined by RCW
19.85.020(2).
2017 Industry NAICS Code | NAICS Code Title | Minor Cost Estimate | Average annual employment | 1% of Avg Annual Payroll | 0.3% of Avg Annual Gross Business Income |
524113 | Direct life insurance carriers | 25599.65 | 2,787 | $25,599.65 2018 Dataset pulled from USBLS | $3,520.62 2018 Dataset pulled from DOR |
524114 | Direct health and medical insurance carriers | 228929.41 | 6,777 | $88,030.57 2018 Dataset pulled from USBLS | $228,929.41 2018 Dataset pulled from DOR |
524126 | Direct property and casualty insurance carriers | 33951.09 | 6,393 | $33,951.09 2018 Dataset pulled from USBLS | $2,571.20 2018 Dataset pulled from DOR |
524127 | Direct title insurance carriers | 21078.9 | 2,646 | $12,947.98 2018 Dataset pulled from USBLS | $21,078.90 2018 Dataset pulled from DOR |
524128 | Other direct insurance (except life; health; and medical) carriers | 6357.56 | 118 | $6,357.56 2018 Dataset pulled from ESD | $5,264.55 2018 Dataset pulled from DOR |
524130 | Reinsurance carriers | 8724.18 | 94 | $8,724.18 2018 Dataset pulled from USBLS | $5,532.67 2018 Dataset pulled from DOR |
524210 | Insurance agencies and brokerages | 4879.47 | 15,498 | $4,879.47 2018 Dataset pulled from USBLS | $2,407.22 2018 Dataset pulled from DOR |
524291 | Claims adjusting | 4302.81 | 530 | $4,302.81 2018 Dataset pulled from USBLS | $2,779.17 2018 Dataset pulled from DOR |
524292 | Third party administration of insurance and pension funds | 23596.65 | 3,108 | $23,596.65 2018 Dataset pulled from ESD | $15,044.80 2018 Dataset pulled from DOR |
524298 | All other insurance related activities | 10871.62 | 1,243 | $10,871.62 2018 Dataset pulled from USBLS | $4,340.77 2018 Dataset pulled from DOR |
October 6, 2020
Mike Kreidler
Insurance Commissioner
AMENDATORY SECTION(Amending WSR 16-03-018, filed 1/8/16, effective 1/8/16)
WAC 284-43-6560When a carrier is required to file.
(1) All rates and forms of group health benefit plans other than small group plans and all stand-alone dental and stand-alone vision plans offered by a health carrier or limited health care service contractor as defined in RCW
48.44.035 and modification of a contract form or rate must be filed before the contract form is offered for sale to the public and before the rate schedule is used.
(2) Filings of negotiated contract forms for groups other than small groups, and applicable rate schedules, that are placed into effect at time of negotiation or that have a retroactive effective date are not required to be filed in accordance with subsection (1) of this section, but must be filed within thirty working days after the earlier of:
(a) The date group contract negotiations are completed; or
(b) The date renewal premiums are implemented.
(3) When a carrier submits a late filing, the carrier must include an explanation on the filing document describing why the carrier submitted the filing late.
(4) The negotiated policy form and associated rate schedule must otherwise comply with state and federal laws governing the content and schedule of rates for the negotiated plans.
(5) Stand-alone dental plans and stand-alone vision plans offered by a disability insurer to out-of-state groups specified by RCW
48.21.010(2) may be negotiated, but may not be offered in this state before the commissioner finds that the stand-alone dental plan or stand-alone vision plan otherwise meets the standards set forth in RCW
48.21.010 (2)(a) and (b).
(6) All stand-alone prescription drug plans which exclusively supplements a medicare Part D employer group waiver plan and modification of a contract form or rate must be filed before the contract form is offered for sale to the public and before the rate schedule is used.