Feds call for state age-curve information

The Center for Consumer Information and Insurance Oversight (CCIIO) has put out the official listing showing how many separate rating areas each state and the District of Columbia can have.

CCIIO (pronounced “See-sigh-oh”), the arm of the Centers for Medicare & Medicaid Services (CMS) in charge of implementing many Patient Protection and Affordable Care Act (PPACA) programs that will affect the private health insurance market, put out the list in conjunction with a questionnaire that it will use to implement the PPACA “age curve” provisions.

The PPACA age-curve provisions state that, starting in 2014, a non-grandfathered carrier in the individual or small group markets can charge the oldest insureds only 3 times as much as they charge the youngest adult insureds.

Today, in some states, the maximum age ratio is about 5 to 1.

In a state that wants to use more than one state-defined geographical rating area for the individual market or the small group market, or both, the state will need information for each geographical rating area, according to the age-curve information questionnaire.

CMS has stated in final regulations that a state can divide itself into rating areas based on county boundaries, on three-digit ZIP codes, or on a division between metropolitan statistical areas (MSAs) and other areas.

CMS let a state keep the number of rating areas it established by any law, rule, regulation, bulletin or other executive action before Jan. 1, 2013.

If a state has not officially stated how many rating areas it wants, or it waited until after Jan. 1, 2013, to take action on the issue, the state can have “no more geographic rating areas than the number of MSAs in the state plus one,” officials said.

The jurisdictions that can have just two rating areas are Hawaii, Rhode Island, Vermont, Wyoming and the District of Columbia.