31.12.08.04

.04 Annual Rate Schedule.

A. Each year, beginning with January 1, 2010, each health maintenance organization shall develop an annual rate schedule for each geographic area.

B. The annual rate schedule required by §A of this regulation shall include a rate for each occurrence of a CPT code or HCPCS code that describes covered services for each type of similarly licensed provider in the same geographic area derived in accordance with the formula specified in §C of this regulation.

C. The rate in the annual rate schedule for each CPT code or HCPCS code shall be developed as follows:

(1) For each type of similarly licensed provider, the rate paid for the CPT code or HCPCS code shall be equal to the total amount allowed for the occurrences of the CPT code or HCPCS code to participating providers who are similarly licensed providers in the same geographic area during the reference year divided by the total number of occurrences paid for the same CPT code or HCPCS code to participating providers who are similarly licensed providers in the same geographic area during the reference year.

(2) For any new CPT code or HCPCS code, the rate paid for the CPT code or HCPCS code shall be equal to 125 percent of the rate paid to a similarly licensed provider in the same geographic area.

D. By not later than December 31 of each year, each health maintenance organization shall provide written certification to the Insurance Commissioner, signed by an individual with the authority to bind the health maintenance organization that the:

(1) Annual rating schedule applicable to the year in which the certification is made is, to the best of that individual's knowledge, information, and belief, compliant with this regulation; and

(2) Individual making the certification has undertaken an adequate inquiry to make the required certification.