Compared with medical lines of business, dental products
typically have more predictable claim patterns, lower overall claim dollar
amounts, and much lower risks and severities of catastrophic claims. This
predictability can foster complacency in dental rate-setting. Some companies go
several years without a robust dental rating manual review or refresh.
Companies instead may choose to focus on rating manual updates for higher-risk
lines of business, and insurers may simply “trend forward” their dental rating
manuals year after year without taking a critical look at what they should change.
It’s important to periodically review dental rating
methodologies for actuarial soundness and to maintain competitive rates. If the
starting claim costs and pricing factors in a rating manual are stale, premiums
likewise will be stale and competitive positioning in the market could suffer
as a result.
In this paper, Milliman’s Tom Murawski and Sean Hilton discuss why actuarially sound rating manuals are essential to adequate and competitive pricing of dental insurance rates.
On June 22, the U.S. Senate released its draft of a bill to amend portions of the Patient Protection and Affordable Care Act (ACA), called the Better Care Reconciliation Act (BCRA). The State Stability and Innovation Program (SSIP), part of the BCRA, is a grant program that provides funds directly to insurers as well as to states with the primary goal to stabilize and support the individual market. The SSIP is composed of two distinct parts. The first provides funds for short-term market stabilization programs that will go directly to insurance carriers in the first four years of the program. The second provides funds for the “Long-term SSIP,” which will be allocated to states starting in 2019 to fund various programs.
This paper by Milliman’s Thomas Murawski discusses elements of the SSIP and outlines the details from the draft bill released on June 22.