2025 -- H 5568
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S T A T E O F R H O D E I S L A N D
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2025
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A N A C T
RELATING TO INSURANCE -- SMALL EMPLOYER HEALTH INSURANCE
AVAILABILITY ACT
Introduced By: Representative Patricia A. Serpa
Date Introduced: February 26, 2025
Referred To: House Corporations
It is enacted by the General Assembly as follows:
SECTION 1. Section 27-50-5 of the General Laws in Chapter 27-50 entitled "Small 1
Employer Health Insurance Availability Act" is hereby amended to read as follows: 2
27-50-5. Restrictions relating to premium rates. 3
(a) Premium rates for health benefit plans subject to this chapter are subject to the following 4
provisions: 5
(1) Subject to subsection (a)(2) of this section, a small employer carrier shall develop its 6
rates based on an adjusted community rate and may only vary the adjusted community rate for: 7
(i) Age; and 8
(ii) [Deleted by P.L. 2021, ch. 88, § 5 and P.L. 2021, ch. 89, § 5.] 9
(iii) Family composition. 10
(2) The adjustment for age in subsection (a)(1)(i) of this section may not use age brackets 11
smaller than five-year (5) increments and these shall begin with age thirty (30) and end with age 12
sixty-five (65). 13
(3) The small employer carriers are permitted to develop separate rates for individuals age 14
sixty-five (65) or older for coverage for which Medicare is the primary payer and coverage for 15
which Medicare is not the primary payer. Both rates are subject to the requirements of this 16
subsection (a). 17
(4) For each health benefit plan offered by a carrier, the highest premium rate for each 18
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family composition type shall not exceed four (4) times the premium rate that could be charged to 1
a small employer with the lowest premium rate for that family composition. 2
(5) Premium rates for bona fide associations except for the Rhode Island Builders’ 3
Association whose membership is limited to those who are actively involved in supporting the 4
construction industry in Rhode Island and members of the greater Providence chamber of 5
commerce shall comply with the requirements of this section. 6
(6) For a small employer group renewing its health insurance with the same small employer 7
carrier that provided it small employer health insurance in the prior year, the adjustment factor for 8
age for that small employer group will not exceed one hundred twenty percent (120%) of the 9
adjustment factor for age for that small employer group in the prior rate year. 10
(b) The premium charged for a health benefit plan may not be adjusted more frequently 11
than annually except that the rates may be changed to reflect: 12
(1) Changes to the enrollment of the small employer; 13
(2) Changes to the family composition of the employee; or 14
(3) Changes to the health benefit plan requested by the small employer. 15
(c) Premium rates for health benefit plans shall comply with the requirements of this 16
section. 17
(d) Small employer carriers shall apply rating factors consistently with respect to all small 18
employers. Rating factors shall produce premiums for identical groups that differ only by the 19
amounts attributable to plan design and do not reflect differences due to the nature of the groups 20
assumed to select particular health benefit plans. Two groups that are otherwise identical, but which 21
have different prior year rate factors, may, however, have rating factors that produce premiums that 22
differ because of the requirements of subsection (a)(6) of this section. Nothing in this section shall 23
be construed to prevent a group health plan and a health insurance carrier offering health insurance 24
coverage from establishing premium discounts or rebates or modifying otherwise applicable 25
copayments or deductibles in return for adherence to programs of health promotion and disease 26
prevention, including those included in affordable health benefit plans, provided that the resulting 27
rates comply with the other requirements of this section, including subsection (a)(4) of this section. 28
The calculation of premium discounts, rebates, or modifications to otherwise applicable 29
copayments or deductibles for affordable health benefit plans shall be made in a manner consistent 30
with accepted actuarial standards and based on actual or reasonably anticipated small employer 31
claims experience. As used in the preceding sentence, “accepted actuarial standards” includes 32
actuarially appropriate use of relevant data from outside the claims experience of small employers 33
covered by affordable health plans, including, but not limited to, experience derived from the large 34
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group market, as this term is defined in § 27-18.6-2. 1
(e) For the purposes of this section, a health benefit plan that contains a restricted network 2
provision shall not be considered similar coverage to a health benefit plan that does not contain 3
such a provision, provided that the restriction of benefits to network providers results in substantial 4
differences in claim costs. 5
(f) The health insurance commissioner may establish regulations to implement the 6
provisions of this section and to ensure that rating practices used by small employer carriers are 7
consistent with the purposes of this chapter, including regulations that ensure that differences in 8
rates charged for health benefit plans by small employer carriers are reasonable and reflect objective 9
differences in plan design or coverage (not including differences due to the nature of the groups 10
assumed to select particular health benefit plans or separate claim experience for individual health 11
benefit plans) and to ensure that small employer groups with one eligible subscriber are notified of 12
rates for health benefit plans in the individual market. 13
(g) In connection with the offering for sale of any health benefit plan to a small employer, 14
a small employer carrier shall make a reasonable disclosure, as part of its solicitation and sales 15
materials, of all of the following: 16
(1) The provisions of the health benefit plan concerning the small employer carrier’s right 17
to change premium rates and the factors, other than claim experience, that affect changes in 18
premium rates; 19
(2) The provisions relating to renewability of policies and contracts; 20
(3) The provisions relating to any preexisting condition provision; and 21
(4) A listing of and descriptive information, including benefits and premiums, about all 22
benefit plans for which the small employer is qualified. 23
(h)(1) Each small employer carrier shall maintain at its principal place of business a 24
complete and detailed description of its rating practices and renewal underwriting practices, 25
including information and documentation that demonstrate that its rating methods and practices are 26
based upon commonly accepted actuarial assumptions and are in accordance with sound actuarial 27
principles. 28
(2) Each small employer carrier shall file with the commissioner annually on or before 29
March 15 an actuarial certification certifying that the carrier is in compliance with this chapter and 30
that the rating methods of the small employer carrier are actuarially sound. The certification shall 31
be in a form and manner, and shall contain the information, specified by the commissioner. A copy 32
of the certification shall be retained by the small employer carrier at its principal place of business. 33
(3) A small employer carrier shall make the information and documentation described in 34
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subsection (h)(1) of this section available to the commissioner upon request. Except in cases of 1
violations of this chapter, the information shall be considered proprietary and trade secret 2
information and shall not be subject to disclosure by the director to persons outside of the 3
department except as agreed to by the small employer carrier or as ordered by a court of competent 4
jurisdiction. 5
(4) For the wellness health benefit plan described in § 27-50-10, the rates proposed to be 6
charged and the plan design to be offered by any carrier shall be filed by the carrier at the office of 7
the commissioner no less than thirty (30) days prior to their proposed date of use. The carrier shall 8
be required to establish that the rates proposed to be charged and the plan design to be offered are 9
consistent with the proper conduct of its business and with the interest of the public. The 10
commissioner may approve, disapprove, or modify the rates and/or approve or disapprove the plan 11
design proposed to be offered by the carrier. Any disapproval by the commissioner of a plan design 12
proposed to be offered shall be based upon a determination that the plan design is not consistent 13
with the criteria established pursuant to § 27-50-10(b). 14
(i) The requirements of this section apply to all health benefit plans issued or renewed on 15
or after October 1, 2000. 16
SECTION 2. This act shall take effect upon passage. 17
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EXPLANATION
BY THE LEGISLATIVE COUNCIL
OF
A N A C T
RELATING TO INSURANCE -- SMALL EMPLOYER HEALTH INSU RANCE
AVAILABILITY ACT
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This act would include members of the greater Providence chamber of commerce in the 1
exclusion of premium rates for the Rhode Island Builders' Association. 2
This act would take effect upon passage. 3
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