This bill amends the minimum loss ratio requirements for health benefits plans in the individual and small employer markets in New Jersey. It establishes that the minimum loss ratio of 80% must be calculated based on a three-year rolling average, which includes data from the previous calendar year and the two years preceding it. Additionally, the bill mandates that health insurance carriers must report their loss ratios annually and issue dividends or credits to policyholders if they fail to meet the minimum loss ratio requirement. The bill also requires the Department of Banking and Insurance to create regulations that specify how these calculations and reporting should be conducted.

Key provisions of the bill include the requirement for the numerator of the minimum loss ratio to consist of claims paid and expenditures for health care quality improvement. It also stipulates that adjustments related to transitional reinsurance programs and risk adjustments must be accounted for in the calculations. Furthermore, any new or increased state and federal taxes or assessments initiated after the bill's enactment will be excluded from the premium calculations for the minimum loss ratio. Overall, these changes aim to ensure that a larger portion of premium dollars is directed towards patient care rather than administrative costs.

Statutes affected:
Introduced: 17B:27A-9, 17B:27A-25