Experience Adjustment Clause Samples
The Experience Adjustment clause allows for modifications to contract terms, such as pricing or coverage, based on the actual experience or performance data collected during the contract period. Typically, this clause is used in insurance or service agreements where factors like claims history, loss ratios, or service usage are reviewed periodically to determine if adjustments are necessary. Its core practical function is to ensure that the contract remains fair and reflective of real-world outcomes, thereby allocating risk more equitably between the parties and preventing significant imbalances due to unforeseen circumstances.
Experience Adjustment. In the event that the actual medical loss ratio (MLR) that the INSURER achieves for this Contract is better than eighty five percent (85%), calculated in the same manner as the premium development and allocation methodology utilized in INSURER’s ITN response. INSURER shall return to FHKC a share of the dollar difference between the INSURER’s actual MLR for said period and the projected minimum MLR of eighty five percent (85%) based on the following tiered Experience Adjustment schedule:
A. Tier I: MLR of 84.99 to 82.00 Percent: 50% to FHKC (84.99% to 82.00%)
B. Tier II: MLR of 81.99 Percent or Less: 100% to FHKC (81.99% or less) If INSURER’s actual MLR is less than eighty-five percent (85%) during a Contract Year, but not lower than eighty-two percent (82%), INSURER shall return to FHKC fifty percent (50%) of the difference between the actual MLR and the projected minimum MLR of eighty-five percent (85%), pursuant to sub- paragraph 3-20-3A Tier I. If INSURER’S actual MLR is less than eighty-two percent (82%) during any Contract Year, INSURER shall return to FHKC the sum of the Tier I and Tier II experience adjustment pursuant to sub- paragraph 3-20-3A and B, as follows:
1) fifty percent (50%) of the difference between INSURER’s actual MLR of eighty-two percent (82%) and the minimum MLR of eighty-five percent (85%), and
2) one hundred percent (100%) of the difference between INSURER’s actual MLR and the Tier II maximum MLR of eighty-two percent (82%). INSURER shall provide FHKC with a written copy of its findings for each Contract year by April 1st (first). If any payments are due under this provision, INSURER shall forward such payment within thirty (30) days of its written notification. INSURER may be subject to audit or verification by FHKC or its designated agents. FHKC shall determine the adequacy of the information supplied under this section and whether or not the calculation has been accurately performed. The calculation shall be reported in a format approved by FHKC and FHKC may also request supporting documentation. After receipt of INSURER’S submission, FHKC may request that the calculation also be provided on a county by county basis. INSURER’S submission must include the following minimum information: Insurer Name: Contract Year: Counties Included in Calculation: Total Premiums Paid to INSURER during Contract Year: $ Actual Incurred Claims for Contract Year: $ Medical Loss Ratio Achieved: % Apply adjustment percentage in accordance with Section...
Experience Adjustment. In the event that the medical loss ratio. for this Agreement is better than eighty five percent (85%) calculated in the same manner as the premium development and allocation methodology utilized in AMERIGROUP’s response to the Request for Proposals (RFP), AMERIGROUP shall share equally with FHKC the dollar difference between the actual loss ratio for said period and the predicted eighty five percent (85%). AMERIGROUP shall provide FHKC with a written copy of its findings for each Agreement year by February 1st (first). If any payments are due under this provision, AMERIGROUP shall forward such payment with its written notification. AMERIGROUP may be subject to audit or verification by FHKC or its designated agents. FHKC shall determine the adequacy of the information supplied under this section and whether or not the calculation has been accurately performed in the manner prescribed below. The Calculation shall be illustrated in the following manner:
Experience Adjustment. HEALTH PLANS Effective Dates: October 1, 2003 - September 30, 2005 In the event that the actual experience is less than 85 percent, in the aggregate for both Well Care and HealthEase, HEALTH PLAN shall pay to FHKC one-half of the difference. HEALTH PLAN shall annually provide FHKC with an aggregate experience report no later than March 1st for the prior calendar year. If any payments are due under this provision, HEALTH PLAN shall forward such payment with its written notification. HEALTH PLAN may be subject to audit or verification by FHKC or its designated agents. FHKC is not under any further obligation if the actual loss ratio exceeds 85%. HEALTH PLANS Effective Dates: October 1, 2003 - September 30, 2005 Page 29 of 50 EXHIBIT B ENROLLMENT PROCEDURES 1 All FHKC eligible participants will be provided with necessary enrollment materials and forms from FHKC or its assignee.
Experience Adjustment. To reflect the impact of population morbidity, program changes, fee schedule changes, and COVID-19 impacts that have occurred since CY 2019, we applied an experience adjustment to the CY 2019 encounter data so that the data reflects utilization and cost levels consistent with a SFY 2021 incurred period. This experience adjustment was developed based on a direct comparison of CY 2019 incurred encounters to SFY 2021 incurred encounters. This process was established to enable use of an experience period closer to the rating period and promote transparency related to the impacts of COVID-19 on emerging experience. The SFY 2021 Experience Adjusted data serves as the primary source for modeling the impact of retrospective and prospective program changes. Below we have outlined the steps of our methodology for developing the Experience Adjustment.
Experience Adjustment. In addition to the annual base rate adjustment provided in Paragraph A of this Section III, Landlord reserves the right to increase or decrease the annual base rate per square foot from time to time by the issuance of a revised rate schedule based on Landlord's accumulated experience compiled from the operation of the central cold air distribution system, including increased costs of materials and supplies, costs incurred for governmental impositions and to meet governmental requirements, unusual or extraordinary costs in maintaining or repairing the central plant equipment and distribution system, costs experienced for purchase and installation of new equipment and renovation of existing equipment and the distribution system and costs incurred to utilize and add to the plant equipment and distribution system new technological features. LANDLORD'S TENANT'S INITIALS INITIALS ---------- -------- J.E.S. DD H.T.S. [GRAPH OF BASE RATE CURVE SHEET @4060 HRS. - SCHEDULE A] LANDLORD'S TENANT'S INITIALS INITIALS ---------- -------- J.E.S. DD H.T.S. [GRAPH OF ADJUSTED RATE CURVE SHEET - SCHEDULE B] LANDLORD'S TENANT'S INITIALS INITIALS ---------- -------- J.E.S. DD H.T.S. SOUTH COAST PLAZA DETAILED DESIGN CRITERIA AND STANDARDS FOR LANDLORD'S WORK AND FOR TENANT'S WORK*
Experience Adjustment. In the event that the medical loss ratio for this Agreement is better than eighty-five percent (85%) in the aggregate for both WellCare and HealthEase calculated in the same manner as the premium development and allocation methodology utilized in the insurer’s original rate proposal in its response to the RFP, INSURER shall share equally with FHKC the dollar difference between the actual loss ratio for said period and the predicted eighty-five percent (85%). The INSURER shall provide annually FHKC with a written copy of its findings each year during the term of this Agreement by February 1st. If any payments are due under this provision, INSURER shall forward such payment with its written notification. The INSURER may be subject to audit or verification by FHKC or its designated agents. FHKC shall determine the adequacy of the information supplied under this section and whether or not the calculation has been accurately performed in the manner prescribed below. The Calculation shall be illustrated in the following manner:
A. Total Premiums Paid During Year: $ B. Target Incurred Claims’: 85% of A C. Actual Incurred Claims for Year: $ D. Difference Between Target Incurred Claims and Actual Incurred Claims: $ (Subtract Line C from Line B) E. Amount Due FHKC (50% of Line D): $ ’ The target medical loss ratio for this Agreement and for this calculation is 85%. HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005 1 All FHKC eligible Participants will be provided with necessary enrollment materials and forms from FHKC or its assignee.