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CNMI Department of Commerce. Rate Review Office. Background. On March 23, 2010, U.S. President Barrack Obama signed into law US Public Law 111-148:The Patient Protection and Affordable Care Act (“PPACA”).

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cnmi department of commerce

CNMI Department of Commerce

Rate Review Office

  • On March 23, 2010, U.S. President Barrack Obama signed into law US Public Law 111-148:The Patient Protection and Affordable Care Act (“PPACA”).
  • On March 27, 2011, the CNMI Department of Commerce received funding from the US Department of Health and Human Services, Office of Consumer Information and Insurance Oversight to maintain compliance with those sections of the PPACA that added and amended Section 2794 of the Public Health Service Act (“PHSA”).
  • As amended by the ACA, the PHSA directs the Secretary of Health and Human Services, in conjunction with the states and beginning in 2010, to establish a process for the annual review of so-called “unreasonable” premium rate increases in the individual and small group markets
  • The CNMI was given the resources to develop and implement an effective health insurance premium rate review process, as well as to develop a draft statute and accompanying regulations to enable implementation of the rate review process.
effective rate review
Effective Rate Review
  • According to the final rule, HHS determines if a state has an effective premium rate review process based on the following criteria:
  • (1) whether the state receives from health insurance issuers data and documentation sufficient to determine whether a rate increase is unreasonable;
  • (2) whether the state conducts an effective and timely review of the data and documentation submitted by issuers in support of a proposed rate increase;
  • (3) whether the state review examines the reasonableness of the assumptions used by the issuer in developing its rate proposal and the historic data underlying those assumptions and data related to past projections and actual experience;
effective rate review1
Effective Rate Review
  • (4) whether the state review takes into consideration certain specified factors;
  • (5) whether the state applies a standard set forth in state statute or regulation when making the determination of whether a rate increase is unreasonable;
  • (6) whether the state provides access from its website to information regarding proposed premium rate increases, and has a mechanism for receiving public comments on the same.
in the cnmi
In the CNMI
  • The sole statute governing the business of insurance in the CNMI, or the Commonwealth Insurance Act of 1983, provides little to no instruction to either the territorial government or the health insurance issuers as to the process by which the latter is to submit proposed premium rate increases.
  • It simply creates the position of the Insurance Commissioner, within the CNMI Department of Commerce, with the general power and duty to administer the statute and promulgate rules and regulations necessary to effectuate the same
in the cnmi1
In the CNMI…..
  • In terms of substantive instructions to insurers, the statute is only textually developed in the basic areas of whom is qualified to be an insurer, how an issuer goes about applying for a license and/or a certificate of authority to operate as an insurer, and what constitutes prohibited acts in the operation of that business
federal assistance
Federal Assistance
  • To assist the CNMI in implementing the ACA Reforms, HHS provided funding in the form of 3 Grant Cycles
  • Cycle I: Implement an “effective” Rate Review Process

-CNMI Premium Rate Review Process

- CNMI Rate Review Repository Interface and Database System

  • Cycle III: Development of IT Database for Pricing Transparency
premium rate review
Premium Rate Review
  • On March 29, 2012 a Request for Proposals were issued to the Public regarding Development of a Premium Rate Review Process.
  • The contracting team, WPEDG (Washington Pacific Economic Development Group) was given the Notice to Proceed in June 2012 headed by Mr. Juan Carlos Benitez
  • As a result, in December 2012, the team was able to formulate an Effective Premium Rate Review Process
  • IT Contract: Ledge Light Technologies (NJ)
  • Development of Portal and linkage with State Electronic Rate and Form Filing (SERFF)

- Allow CNMI Insurance carriers the opportunity to upload their files for review

- Allow RRO to review documents and make recommendations to Insurance Commissioner

- Allow the Public to make comments on the proposed rate changes submitted by Insurance Carriers

cycle ii enhancement
Cycle II- Enhancement
  • Cycle II: Enhancement of the CNMI Premium Rate Review Process

- Technical Actuarial Services

- Consumer Outreach

- Actuarial Services

- Harmonization

technical services
Technical Services
  • The Insurance Commissioner has identified the need for a Technical Advisor

- Assist CAP and RRO in ensuring the CNMI complies with ALL market reforms of the ACA

- Assist RRO in speeding up the necessary work needed to have office become fully “effective”

- Tentative Date of Hire: Early January

consumer outreach
Consumer Outreach
  • Upon completion of the CRRRIDTS, the RRO will be responsible for informing consumers of Proposed Rate Increases as well as to encourage the Public to provide comments via CRRRIDTS

-Possible launch in mid-late January

- Provide access to the Public regarding carrier submissions

actuarial services
Actuarial Services
  • The need for an Actuary will be more ideal as Insurance Carriers begin filing rates
  • Responsible for review and recommendations to RRO Project Manager
  • Two Phase Project (Dependent on Carrier Submissions)
  • Harmonization Project: Contractor is assessing the feasibility of streamlining processes with the U.S. Territory of Guam

- Most carriers providing Health Insurance in the CNMI also provide services in Guam

- Analyze Guam’s “effective” Rate Review process to possibly sync with CNMI Processes

- Possibility of pooling both populations to lower costs

  • CAHIT: CNMI ACA Health Insurance Team

-SixtoIgisomar, Secretary and Insurance Commissioner

-Reena Patel, Asst. Attorney General (Commerce)

-Charlette C. Borja, Insurance Licensing Spec.

-Kaitlyn Neises-Mocanu, Consumer Advocacy Officer

-Brien S. Nicholas Jr., Project Manager (RRO)

  • On-going Draft Legislations:

- Amendment to CNMI Insurance Code

- CNMI Rate Review Legislation

  • Several Administrative Notices have been issued from the Dept. of Commerce Insurance Section to Insurance Carriers

- Admin Notice: 2013-03: Implementation

- Administrative Notice 2013-04: Early Renewal

- Admin Notice 2013-05: Transitional Policy regarding Individual and Small Group Health Plans


- Admin Notice 2013-06: Grandfathered Plans and Policies in the CNMI

- Admin Notice 2013-07: Rate and Form Filing

Note: Notices may be found on the Commerce Website:

( or CAP Website: (

looking forward
Looking Forward
  • Cycle III Funds from HHS:

- Database Development

- Public Health Records and Statistics

- Pricing Transparency

- Projected Time of Execution: Summer 2015

looking forward1
Looking Forward
  • Upon completion of the Funding Cycles, the Dept. of Commerce plans to continue its efforts through:

- Rate Review Examinations

- Consumer Advocacy and Outreach

- Market Conduct Examinations

- Financial Analyst/Examiner (Solvency)