All Companies Writing Accident and Health Insurance and Manage Care Plans in Illinois : COMPANY BULLETIN 2022-07 - ILLINOIS FILING REQUIREMENTS FOR INDIVIDUAL AND SMALL GROUP HEALTH PLANS, ON AND OFF-MARKETPLACE (ON AND OFF-EXCHANGE) AND STAND-ALONE DENTAL PLANS

Springfield Office 320 W. Washington Street Springfield, Illinois 62767 (217) 782-4515 Chicago Office 122 S. Michigan Ave., 19th Floor Chicago, Illinois 60603 (312) 814-2420 Illinois Department of Insurance JB PRITZKER Governor DANA POPISH SEVERINGHAUS Director COMPANY BULLETIN TO: All Companies Writing Accident and Health Insurance and Manage Care Plans in Illinois FROM: Dana Popish Severinghaus, Director DATE: May 4, 2022 RE: COMPANY BULLETIN 2022-07 - ILLINOIS FILING REQUIREMENTS FOR INDIVIDUAL AND SMALL GROUP HEALTH PLANS, ON AND OFF-MARKETPLACE (ON AND OFF-EXCHANGE) AND STAND-ALONE DENTAL PLANS The purpose of this Bulletin is to provide instructions to Issuers seeking certification or recertification of individual and small group plans and Stand-alone Dental Plans (SADP) offered on the Individual and Small Business Health Options Program (SHOP) Marketplace. This Bulletin also applies to those plans offered off the ACA Marketplace (Off-Exchange) in the individual and small group markets for Plan Year 2023. Student health plans are required to meet the standards for individual QHP plans with the exception of filing dates and rating rules. Student Health plans must follow the specific rating and eligibility rules as outlined by CMS for such plans. Note: The issuer deadlines apply to ALL individual and small group health plans, and dental plans offered on and off the Marketplace. Activity Dates Plan and Rate Application and Review Process Deadline for Issuers to Submit Plan Data and Rate Filings to Illinois Through SERFF 5/25/2022 Illinois DOI First SERFF Data Transfer Deadline. 6/15/2022 CMS Reviews Initial Qualified Health Plan (QHP) Applications 6/16/2022 – 7/15/2022 Illinois DOI Second SERFF Transfer Deadline 7/20/2022 CMS reviews Rates Table Template data and resubmitted QHP Application data, and releases results in the PM Community for issuers and states to review 7/21/2022 – 8/12/2022 Issuer Plan Confirmation/Crosswalk Deadline: Issuers complete final plan confirmation and submit final Plan ID Crosswalk Templates in the PM Community* 8/10/2022 – 8/24/2022 Illinois DOI Final SERFF Data Transfer Deadline. Deadline for issuers to submit changes to their QHP 8/17/2022 Page 2 of 6 Applications and to submit marketing URL data in the HIOS Supplemental Submission Module (SSM) CMS reviews QHP Applications and releases results in the PM Community for issuers and states to review 8/18/2022 – 9/12/2022 CMS sends QHP Certification Agreements to issuers 9/13/2022 Illinois DOI Completes CMS Final Plan Recommendations 9/13/2022 – 9/21/2022 QHP Agreement Signing Deadline: Issuers return signed QHP Certification Agreements to CMS 9/13/20202– 9/21/2022 QHP Agreement/ Final Correction Limited Data Corrections Window (Outreach to Issuers with CMS or Illinois DOI Identified Data Errors; Issuers Submit Corrections; CMS Reviews and Finalizes Data for Open Enrollment) 9/15/2022– 9/16/2022 Machine-Readable/URL Deadline: Deadline for issuers’ machine-readable data to be posted and marketing URLs to be live and active 9/21/2022 CMS Releases Certification Notices to Issuers and States 10/4/2022 – 10/5/2022 Anticipated public display of QHP quality rating information 11/1/2022 Open Enrollment Begins 11/1/2022 *Any revised crosswalk submitted to CMS in PM Community, must also be submitted to the state binder in SERFF. Issuers are advised to consult federal regulations, 2023 Letter to Issuers released April 28, 2022, and state law in conjunction with this Bulletin to ensure full compliance. Helpful documents can be found on the Illinois Department of Insurance’s ACA Issuer Homepage. 1. All form filings must be submitted in the format of a complete insurance policy. The Department will not accept matrix insert page filings, riders, amendments, variable language or brackets within individual (including ACA compliant student health plans) and small group filings. Approved filing will only be reopened upon request from CMS. NOTE: Summary of Benefits and Coverage may contain bracketed information per the federal template, and the cover page may include brackets for policyholder name, policy number, product name, effective date of policy and other identifying data. 2. Issuers are prohibited from utilizing misleading plan marketing names on all forms and/or corresponding templates. Specifically, issuers are prohibited from using dollar amount references in plan marketing names and templates. 3. Visit the CMS QHP Certification Website and complete the QHP Application checklist. 4. For 2023 plans, Illinois will require the crosswalk template to be uploaded to the binders. 5. Submit all checklists, templates and supporting documentation in SERFF. 6. Provide a red-lined version identifying the variations in plan benefit design from the plans submitted for the previous plan year for each form filing submitted for recertification. Red-lined versions must be submitted under the supporting documentation tab in the form filing in SERFF. 7. Associate all relevant filings in the SERFF binder including but not limited to form, rate, external review, and network adequacy filings. 8. Previously filed Network Adequacy filings may be associated in the binder however, all plans must demonstrate compliance with the mental health/substance use disorder access to care guidelines found in 215 ILCS 124/10(d-5), effective 1/1/2022. The Department requires full updated network adequacy filings to be submitted. 9. Network Adequacy County Facilities Collection Template - This excel document must be accurately completed for each applicable network(s) that the plan intends to service. Data collected will identify specific contracted Hospital and Mental Health Facility information for each respective county the plan Page 3 of 6 intends to service. This document must accompany the Network Adequacy filing. Visit the Accident & Health Checklists section of the Department’s website to access and complete the template. 10. Service Area Exemption: Issuers that fail to offer coverage to an entire rating area must obtain an exception from the Department. (See QHP Service Area Exception Form) The Issuer must provide service area maps to show compliance with the service area requirement. 11. Issuers who are not able to comply with the network adequacy standards for time and distance and provider ratio are required to complete the Network Adequacy Exception Form with specific details pertaining to the known deficiency for the Department’s review and consideration. Note: Pursuant 215 ILCS 124/10(g) no exceptions may be granted for the requirements set forth in ILCS 215 124/10(d-5), but issuers should still identify deficiencies. 12. Remit the fee of $3,000.00 for certification of each new QHP plan and $1,500.00 for recertification for each existing QHP plan via EFT in SERFF binder filings at the time of binder submission. 13. For Plans that will be discontinued or modified, Issuers must submit the appropriate letters or notifications pursuant to 215 ILCS 97/60 no later than July 1, 2022. 14. NEW for PY 2023 off exchange only ACA compliant plans in the individual and small group markets. Issuers must submit an off exchange only binder with all off exchange only plans following the requirements outlined in this bulletin. 15. Every plan listed on the Plans & Benefits Template that the Issuer intends to market as an HDHP or for use with an HSA must have “HSA-Eligible” checked on the template. No plan with a flat-dollar copayment structure for the entire prescription drug benefit as described in 215 ILCS 134/45.3 may be marketed as an HDHP or have the “HSA-Eligible” field checked on the template. Pursuant to the Final Notice of Benefit and Payment Parameters for 2023, standardized plan options do not include HSA- eligible HDHPs. Issuers may be required to attach other checklists and/or supporting documentation templates, as indicated by the ACA Individual, Small Group, and Catastrophic Checklists. Maximum Annual Limitation on Cost Sharing for Plan Year 2023 Individual Coverage Family Coverage Health Plans $9,100 $18,200 SADPs $375 $750 Exhibit 1: 2023 Health Plans Filing Requirements – Form and Binder Required Submission Via SERFF Federal Required Templates On/Off- Exchange Off- Exchange Location All Applicable templates/documents listed on the CMS Certification Checklist Yes Yes* (New) Binder * Illinois Required Documents ACA Individual, Small Group, and Catastrophic Checklist Yes Yes Form filing ACA Individual and Small Group SADP Checklist Yes Yes Form filing Network Adequacy and Transparency Checklist (not applicable to SADPs) Yes Yes Network Adequacy Filing Page 4 of 6 Mental Health Parity Supporting Documentation Template (does not include SADP) Yes Yes Form Filing Proposed Enrollment Template Yes Yes Binder External Review Checklist (Not applicable to SADPs) Yes Yes External Review Filing QHP Rates Guidance: New for the 2023 plan year, the Centers for Medicare & Medicaid Services (CMS) and the National Association for Insurance Commissioners (NAIC) have established a system connection between the System for Electronic Rates & Forms Filing (SERFF) and the Health Insurance Oversight System Unified Rate Review (HIOS URR) module. If the issuer entered a rate filing submission into HIOS OR SERFF prior to 3/25/22 then they will need to do all updates for Illinois in the legacy portion of SERFF and all updates for CMS directly in HIOS for that submission. In this case, issuers cannot update the submission using the new SERFF to URR Transfer process. All new filings created AFTER 3/25/22 should have been submitted using the new SERFF to URR Transfer Process. This is done by using the new URRT Tab in SERFF. If an issuer enters their rate submission incorrectly through HIOS instead of SERFF, CMS will deactivate that submission and notify the issuer that it must be entered through the SERFF Transfer Process. Two tutorial videos are below: • URRT tab/filing submission (17 minutes)  https://naic.webex.com/naic/ldr.php?RCID=8fdd279b684dd81e95f1ed6576bdee6d • URRT Responses/Amendments (6 minutes)  https://naic.webex.com/naic/ldr.php?RCID=dc62c787e0658801e981c296b1bdfe52 1. The Department will allow carriers to modify their individual and small group rate filings through July 8, 2022 to reflect updated assumptions related to risk adjustment. Other types of changes or changes after this date will be allowed at the discretion of the Department. All documents that change will need to be resubmitted in redline format to allow for a more efficient review. 2. Since July 1, 2019, it has been illegal in Illinois to sell tobacco products to individuals under 21 years of age. Accordingly, premium rates for consumers in this age group should not include a tobacco load. 3. Actuarial memorandums must include an estimate of the impact of an American Rescue Plan Act (ARPA) subsidy extension on Plan Year 2023 proposed rates, if any. 4. Actuarial memorandums must break out separately the assumed impact of the end of the Public Health Emergency (PHE) on the Plan Year 2023 proposed rates, if any, and provide both quantitative and qualitative support for the assumed impact. 5. Actuarial memorandums must include the commission schedules and any recent or anticipated changes thereto. 6. Carriers offering QHPs in the individual market are encouraged (but not required) to load the expected costs of missing CSR payments from the federal government onto just their on-exchange Silver plans and to also offer off-exchange only Silver plans without this load. Please address the issue of CSR loads in the actuarial memorandum. Induced Demand Guidance for the 2023 ACA Illinois Rate Filing Process: One of the larger variations seen in the development of ACA rates in the Illinois market is the induced demand component that is attributed to plans. As such, the Illinois Department of Insurance is issuing guidance for the Page 5 of 6 2023 ACA Rate Filings. Below are the items that the Illinois Department of Insurance is asking carriers to provide with the development of the 2023 ACA Rates: • Stand-alone Induced Demand Factors – The induced demand factors should be provided for each plan as a separate and stand-alone factor. • Quantitative and Qualitative Support – Provide both quantitative support for the development of the induced demand factors as well as qualitative support to explain the process and the reasoning behind any quantitative assumptions. For any assumptions or calculations that are the result of internal/external models, carriers should be prepared to demonstrate and explain both the methodology and the results behind each model output. Additionally, carriers should provide support to demonstrate that the proposed induced demand factors do not reflect the impact of morbidity differences between the members expected to enroll in each plan or set of plans. • Historical Induced Demand Factors – Provide a table listing the minimum, maximum and average (weighted by plan membership) induced demand factor by metal level for the most recent 3 years (2021, 2022 and 2023). COVID-19 Guidance for the 2023 ACA Illinois Rate Filing Process: • Historical Experience Adjustment – Actuarial memorandums must include a description of how the historical base experience base experience was adjusted in order to remove the effect(s) that COVID may have had on the claims experience in that year. In providing its description, the carrier should make sure to include the adjustment that was applied to the historical base experience, as well as both quantitative and qualitative support for the adjustment. • Prospective Adjustment - Actuarial memorandums must include the carrier’s anticipated impact of COVID on the 2023 claims experience, if any, relative to if COVID did not exist. To the extent the anticipated effect of COVID on claims in aggregate for 2023 is different than 0.0% (i.e., no impact), carriers must break-out separately and provide quantitative support for each of the following items: COVID vaccine costs, COVID testing costs, Other COVID-related costs (please include a description of what is included in Other if different from 0.0%). Other Rate Adjustment Factors: • American Rescue Plan Act (ARPA) • Extended Special Enrollment Period • Risk Adjustment Data Validation (RADV) If any of the above “Other Rate Adjustment Factors” apply, please provide narrative and quantitative support detailing all assumptions as well as explain where the adjustment is applied. Exhibit 2: 2023 Health Plans Filing Requirements – Rates Required Submission via SERFF Federal Required Templates On-Exchange Off- Exchange Location QHP Rating Module Documents • Rates Table Template • Business Rules Template Yes Yes Rate filing & Binder Unified Rate Review Template Yes Yes Rate Filing & Binder Illinois Required Documents Page 6 of 6 Health Premium Rate checklist Yes Yes Rate Filing & Binder Proposed Enrollment Template Yes Yes* (New) Rate Filing & Binder *Beginning for Plan Year 2023 submissions, the Department requires issuers to submit the applicable federal QHP templates for all off-exchange only non-QHP individual and small group filings via a separate off-exchange only Binder submission.