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#61
07-25-2014, 07:55 PM
 Actuary1129 SOA AAA Join Date: Mar 2013 College: Bates College Alumni Posts: 6

Quote:
 mathmajor, where are you getting 256.96? The HMO high P0002 net claim PMPM I see given is \$177.33. Consequently I'm getting a much lower manual claim PMPM.
\$256.96 is the expected claim cost PMPM for 2011 taken from the earlier case study work, divided by the target loss ratio.
#62
10-07-2014, 06:35 PM
 UFActuary Member Join Date: Jul 2005 Posts: 3,431

I think you might want to calculate Ben factor for adjusted Plan0001 starting from the original Plan0001

That would mean find factor relative to old plan 0001 and then multiply this by the .85 benefit factor to get the change from high cost plan....instead of take direct relativity from new plan to high plan

Reason I might do this...as opposed to ignoring the original plan 0001 completely
is to account for plan design dollar amounts like Rehab that we didn't use in cost model and that we can assume is imbedded in the plan0001 Ben factor and not that high plan
#63
01-14-2015, 04:04 PM
 Atropellador Member Join Date: May 2008 Posts: 7,034

Quote:
 Originally Posted by Sir Deicide We don't know what the experience period is, we don't know if provider discounts have changed, and the copay assumptions are variable.
Yeah, I don't see how I can glean the information I need to set a reliable experience rate from the \$186.23 PMPM figure, when we have no idea what discounts the incumbent carrier was getting.

Maybe the prospect is a high-morbidity group, but the carrier got deep discounts.

Maybe they are young, healthy people, but the carrier is a little TPA with a rental network that has to pay at or near the chargemaster price.

CRIC needs to charge a higher premium in the first case than in the second.
#64
01-14-2015, 05:38 PM
 Atropellador Member Join Date: May 2008 Posts: 7,034

Where are Meanie506 and mathmajor getting the 0.95 size factor applicable to the manual rate for a 2000-member group? I can't find it in the course materials.
#65
01-14-2015, 06:41 PM
 Actuarialsuck Member Join Date: Sep 2007 Posts: 6,147

Quote:
 Originally Posted by Atropellador Where are Meanie506 and mathmajor getting the 0.95 size factor applicable to the manual rate for a 2000-member group? I can't find it in the course materials.
On the "Data2-BenefitIndex" tab, doesn't it have a table that says:

Size Factor Scale
Size Factor
>1,000 0.95
300-1,000 0.98
100-300 1
51-100 1.02
<50 1.1
__________________
Quote:
 Originally Posted by Buru Buru i'm not. i do not troll.
#66
01-14-2015, 10:18 PM
 Atropellador Member Join Date: May 2008 Posts: 7,034

Ah, yes, thanks. I was thinking it was off with the starting manual rate, and read right past that.
#67
02-09-2015, 04:57 PM
 actuary2015 SOA Join Date: Nov 2014 Posts: 11

I got the following numbers:

My manual premium seems to be much lower than what most people have posted above...
1. started off with the \$177.33 given for P0002
2. adjusted for benefit design - first by 0.85 to P0001, then by a factor to reflect the difference in claims cost in the cost model for P0001 and the new plan => overall factor of 0.80
3. multiplied by size factor of 0.95
4. divided by 85% target loss ratio
(assumed the cost model provided was for 2011 and therefore no trend adj required)

My experience premium seems to be consistent with what others have got.

Anyone else getting similar numbers to mine?
__________________
1) Health Foundations 2) Pricing, Reserving & Forecasting 3) Financial Economics 4) DMAC 5) FAC

Last edited by actuary2015; 02-09-2015 at 05:45 PM..
#68
03-27-2015, 12:15 PM
 doublebourbon SOA Join Date: Feb 2010 Posts: 7

I'm struggling with the experience PMPM, particularly in getting the benefit factor for the new plan.

1) Copy P0002 model and adjust copay/utl for old plan
-Hospital Inpatient to \$350 (no utl impact)
- Hospital Outpatient to \$150 (no utl impact)
- ER remains at \$100 (no utl impact)
- Physician goes to \$15/\$25 at 70%/30% to come out to \$18 (reducing Office Visits and Other by 80 visits)
- Rx to \$10/\$40 at 70%/30% to come out to \$19 (reducing Scripts/1000 by 625)
- Gross PMPM Cost = 201.79
2) Copy P0002 model and adjust copay/utl for new plan
-Hospital Inpatient to \$500 (no utl impact)
- Hospital Outpatient to \$250 (no utl impact)
- ER to 250 (reduce cases/1000 by 20)
- Physician goes to \$20/\$40 at 70%/30% to come out to \$26 (reducing Office Visits and Other by 208 visits)
- Rx to \$15/\$50 at 70%/30% to come out to \$25.50 (reducing Scripts/1000 by 1437.50)
- Gross PMPM Cost = 194.81
3) Benefit Factor = 194.81 / 201.79 = 0.9654

What am I missing? Why is my factor higher than everyone elses?
#69
03-27-2015, 12:43 PM
 Atropellador Member Join Date: May 2008 Posts: 7,034

Quote:
 Originally Posted by doublebourbon 3) Benefit Factor = 194.81 / 201.79 = 0.9654 What am I missing? Why is my factor higher than everyone elses?
By ratio'ing gross PMPM cost rather than net PMPM cost, you are capturing only the effects of the induced utilization, not the direct effects of the changes in cost sharing.
#70
03-27-2015, 01:02 PM
 doublebourbon SOA Join Date: Feb 2010 Posts: 7

Quote:
 Originally Posted by Atropellador By ratio'ing gross PMPM cost rather than net PMPM cost, you are capturing only the effects of the induced utilization, not the direct effects of the changes in cost sharing.
The benefit factor I get from net costs is 0.8599. Which after 11% trend and 85% MER, results in \$209 PMPM for 2011. Still less than what others have recently posted but I guess that's what I'll go with.

Thank you.