Subject of Possible Rule Making: Health product geographic rating areas.

     Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 48.02.060, 48.44.050, 48.46.200.

     Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: Rates must be developed for nongrandfathered individual and small group plans that are offered, issued or renewed on or after January 1, 2014, using rate development methodology required by section 2701 of the Public Health Service Act (PHSA). One of the required rating factors is geographic area; Washington law does not define specific permitted geographic areas. Proposed federal rules issued November 26, 2012 (proposed 45 C.F.R. 147.102 (b)(1)) require states to designate their geographic rating area(s), or United States Department of Health and Human Services (HHS) will designate a single geographic area for the state. Carriers have advised the commissioner that one geographic area would negatively affect rates; this proposed rule making focuses on selecting the geographic rating areas for Washington.

     Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: HHS also regulates rate review of health plans and products. They have delegated this decision making to Washington state; coordination with them will consist of notifying them of the state's decision regarding geographic rating areas.

     Process for Developing New Rule: Submit written comments by February 15, 2013, to rulescoordinator@oic.wa.gov, fax (360) 586-3109.

     Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication by contacting Meg Jones, P.O. Box 40258, Olympia, WA 98504, e-mail rulescoordinator@oic.wa.gov, fax (360) 586-3109.

January 2, 2013

Mike Kreidler

Insurance Commissioner