Notwithstanding ch. 625, the commissioner shall promulgate rules: (1) Establishing restrictions on premium rates that a small employer insurer may charge a small employer such that the premium rates charged to small employers with similar case characteristics for the same or similar benefit design characteristics do not vary from the midpoint rate for those small employers by more than 35 percent of that midpoint rate. (2) Establishing restrictions on increases in premium rates that a small employer insurer may charge a small employer such that: (a) The percentage increase in the premium rate for a new rating period does not exceed the sum of the following: 1. The percentage change in the new business premium rate measured from the first day of the prior rating period to the first day of the new rating period, or the percentage change in the base premium rate in the case of a class of business for which the small employer insurer is not issuing new policies. 2. An adjustment, not to exceed 15 percent per year, adjusted proportionally for rating periods of less than one year, for such rating factors as claim experience, health status, occupation, and duration of coverage, determined in accordance with the small employer insurer’s rate manual or rating procedures. 3. An adjustment for a change in case characteristics or in benefit design characteristics, determined in accordance with the small employer insurer’s rate manual or rating procedures. (b) The percentage increase in the premium rate for a new rating period for a policy issued before August 15, 1991, does not exceed the sum of par. (a) 1. and 3., unless premium rates are in compliance with the rules promulgated under sub. (1). (3) Requiring the premium rate of a policy issued before August 15, 1991, to comply with the rules promulgated under sub. (1) no later than 3 years after August 15, 1991. (4) Defining the terms necessary for compliance with this section. (5) Ensuring that small employers are classified using objective criteria. (6) Ensuring that rating factors are applied objectively and consistently within a class of business.
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