Ins 8.11(3)(i)(i) “Incurred” means to have provided or furnished a service or item to an employee or dependent covered under an employee health care benefit plan for which a charge for a covered expense is made.

Ins 8.11(3)(j)(j) “Maximums” means the largest total amount of claims per person established by the employee health care benefit plan which the county or school district is obligated to pay.

Ins 8.11(3)(k)(k) “Paid basis” means the application of a claim payment to the aggregate deductible for the benefit period in which the payment is actually made, regardless of when the claim is incurred.

Ins 8.11(3)(L)(L) “Quota share reinsurance” means insurance purchased for the employee health care benefit plan which pays the plan a predetermined fixed percentage of each claim.

Ins 8.11(4)(a)(a) Excess or stop-loss insurance required by s. 120.13 (2) (c), Stats., shall provide coverage for all claims incurred during the term of the policy or contract at a level at which an actuary has certified that the probability that aggregate claims will exceed 125% of expected claims is less than 5%.

Ins 8.11(4)(b)(b) Each employee health care benefit plan shall be covered by one excess or stop-loss insurance policy that satisfies par. (a), regardless of the number of counties or school districts participating in the plan.

Ins 8.11(4)(c)(c) Notwithstanding par. (a), a county or school district that self-insures employee health benefits under a plan in which an actuary has certified that the probability that aggregate claims will exceed 125% of expected claims is less than one-half percent need not purchase excess or stop-loss insurance.

Ins 8.11(5)(b)(b) Upon termination for any reason of an excess or stop-loss insurance policy that provides coverage on a paid basis, the policy shall apply all claims incurred but not paid prior to the termination of the policy to the aggregate deductible of the benefit period in which the service or item was provided or furnished to an employee or dependent under the self-insured employee health care benefit plan.

Ins 8.11(6)(a)(a) Every county or school district with a plan that is subject to s. 120.13 (2) (c), Stats., shall file with the commissioner of insurance within 30 days after the effective date of the self-insured employee health care benefit plan, every 3 years thereafter and whenever a material change occurs to the plan, an actuarial certification that includes information on:

Ins 8.11(6)(a)2.2. A description of the plan’s coverage including but not limited to an outline of benefits provided, deductibles, coinsurance, maximums and quota share reinsurance, if any.

Ins 8.11(6)(a)4.4. Except for a county or school district with a plan subject to s. 641.08, Stats., a copy of the excess or stop-loss insurance contract and of the plan for self-insuring.

Ins 8.11 NoteNote: A county or school district with a plan subject to ch. 641, Stats., must already file this information with the commissioner.

Ins 8.11 NoteNote: Chapter 641, Stats., was repealed by 2003 Wis. Act 261.

Ins 8.11(6)(b)(b) The actuarial certification required in par. (a) may be filed by an actuary employed by the excess or stop-loss insurer or by an actuary independent of the excess or stop-loss insurer.

Ins 8.11(6)(c)(c) Two or more counties or 2 or more school districts that jointly establish an employee health care benefit plan shall designate the individual who will file the actuarial certification required in par. (a). Only one actuarial certification shall be filed for the plan.

Ins 8.11 NoteNote: The commissioner of insurance will utilize the following tables to evaluate actuarial certifications for accuracy and compliance with this section. The following example illustrates the application of the tables. This example only gives a basic description of how to use the following tables. It may be necessary to extrapolate or interpolate from the information given in the tables in order to apply the tables to a particular plan. An actuary or other qualified person should be consulted to be certain that a plan meets the requirements of sub. (4). Also note that no table provides a description of dental or vision plan benefits. Under sub. (4) (c), many dental or vision plans may not need to purchase stop-loss insurance.

Ins 8.11 NoteAssume a school district has a self-insured employee health care benefit plan that covers 250 employees and family members. The plan offers individual specific stop-loss of $25,000 and provides benefits with a $500.00 deductible per person, 80% coinsurance and $1,000.00 out-of-pocket limit per person.

Ins 8.11 NoteThe plan’s stop-loss coverage and benefit package are the same as that used in Table 7. Therefore, use Table 7 for determining whether the plan meets the requirements in sub. (4).

Ins 8.11 NoteIn Table 7, use the 125 percent of mean line. Since sub. (4) (a) deals with “125% of expected claims,” refer to the 125% of mean line when using any of the tables.

Ins 8.11 NoteTo determine whether the probability that aggregate claims will exceed 125% of expected claims is less than 5%, subtract the decimal numbers shown in the tables from the number “1”. For example, for a plan offering the benefits described in Table 7 and having 25 employees, the probability that aggregate claims will exceed 125% of expected claims is 28% (1 minus .72= .28). It is 26% for 50 employees (1 minus .74), 23% for 100 employees (1 minus .77), etc.

Ins 8.11 NoteIn this example, the plan covers 250 employees. Table 7 shows that at 250 employees, the probability that aggregate claims will exceed 125% of expected claims is 18% (1 minus .82).