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Docket No. INS-06-1030



By Decision and Order dated December 21, 2006, then Superintendent of Insurance Alessandro A. Iuppa denied the request of Anthem Blue Cross and Blue Shield (“Anthem”) for approval of its rate filing for 2007 individual / self-employed employer coverage under the DirigoChoice group product, but granted Anthem an opportunity to submit a revised filing consistent with the findings and conclusions set forth in the Decision and Order, and the attachments thereto. Thereafter, by Decision and Order dated January 4, 2007, Superintendent Iuppa approved revised DirigoChoice individual / self-employed employer rates for implementation by Anthem.

By the December 21, 2006 Decision and Order, the Superintendent granted Anthem’s request to make a later compliance filing to include an adjustment to the approved rates for the savings offset payment (“SOP”) if one is assessed by the Dirigo Health Agency (“DHA”) in 2007. See December 21, 2006 Decision and Oder, Section I at p. 23. DHA has decided to assess an SOP beginning in July 1, 2007. By submission dated April 17, 2007, Anthem filed revised rates that have been adjusted by the amount of the SOP, to be implemented beginning with the July 2007 DirigoChoice individual / self-employed employer renewals.

The spreadsheet included with the April 17 filing calculates in tab “hrg req response 3&4 (modified).” Cell AI21, the third-quarter rate increase, includes a cap of 1.366.1 As a result, adding the SOP does not affect the value in this cell. That means that in order to increase the value in cell W1 to the desired level, the calculated increases for the other three quarters are larger to offset the lack of any increase in the third-quarter rates. However, the tab “compliance filing” increases the rates for both the third and fourth quarters. For purposes of the current filing, the cap should not apply. As explained in the December 21, 2006, Decision and Order, the purpose of the cap was to reflect the maximum increase stated in Anthem’s notice to members. Since the notice reflected increases before application of the SOP, the cap should not apply. Therefore, the cap should be removed in cell AI21 in tab “hrg req response 3&4 (modified)” and the value in cell AQ 17 should then be recalibrated to 1.327. This will reduce the proposed increase in the third- and fourth-quarter rates from the 1.81% reflected in the April 17 filing to 1.61%.

The Acting Superintendent hereby ORDERS:

  1. Approval of the rates filed April 17, 2007, by Anthem Blue Cross and Blue Shield for DirigoChoice individual and self-employed employer members is DENIED. Accordingly, the proposed rates filed by Anthem for DirigoChoice individual and self-employed employer members do not enter into effect.
  2. Anthem is authorized to submit revised rates for review and they shall be APPROVED if the Superintendent finds them to be consistent with the terms of this Decision and Order. Rates approved in this manner are to be effective on such a date as will assure a minimum of 30 days prior notice to certificate holders.

This Decision and Order is final agency action of the Superintendent of Insurance, within the meaning of the Maine Administrative Procedure Act, 5 M.R.S.A. § 8002(4). It may be appealed to the Superior Court in the manner provided for by 24-A M.R.S.A. § 236, 5 M.R.S.A. §§ 11001 through 11008 and M.R. Civ.P. 80C. Any party to the proceeding may initiate an appeal within thirty days after receiving this notice. Any aggrieved non party whose interests are substantially and directly affected by this Decision and Order may initiate an appeal within forty days of the issuance of this decision. There is no automatic stay pending appeal. Application for stay may be made in the manner provided in 5 M.R.S.A. § 11004.

1 The increase for the other three quarters is similarly capped but the calculated increases are not large enough for the cap to come into play.

Dated: April 24, 2007 ___________________________________
Acting Superintendent of Insurance




Last Updated: January 16, 2014