Key takeaways
- Regression models predict expected claims cost by member group, plan design and region from the claims, enrollment and plan data you already hold.
- A second model estimates how price changes move plan choice and renewal, so pricing and retention are set together.
- Every model is explainable, with reason codes and model documentation your actuaries can review and defend.
- Your actuaries still set and sign every rate; the models give them a faster, better-tested starting point.
Every rate cycle starts from a spreadsheet
Price a plan too high and members move to a competitor at renewal. Price it too low and you attract risk the premium does not cover.
Your actuaries rebuild pricing models by hand each cycle, often with a few trusted variables and a lot of manual adjustment. That limits how many plan designs, regions and member groups they can test before the filing deadline.