Variable Rates Options

Vary standard rates with variable rate profiles that specify eligibility criteria, calculation method, and how the calculation affects the associated standard rate.

This topic discusses:

• Standard rate

• Variable rate profiles

• Multiple eligibility criteria

• Exclusion from the variable rate

• Treatment rule

• Variable formula

Standard Rate

If a rate doesn't vary based on any factors, define the rate on the standard rate page. For example, if a dental plan rate is a flat amount of 8.00 per month regardless of age or other factors, use a standard rate.

To vary the standard rate, attach variable rate profiles to it.

Variable Rate Profiles

Rates may vary based on certain factors, such as age, smoking status, and compensation amount. You can create a variable rate profile for each rate amount. You can only attach one eligibility profile to a variable rate profile.

Example: If a life insurance plan costs more for a smoker than a nonsmoker, you:

1. Create two eligibility profiles, one for smokers and another for nonsmokers.

2. Create two variable rate profiles and associate each with the corresponding eligibility profile.

3. Specify the rate calculation for each variable rate profile.

Multiple Eligibility Criteria

If a rate varies based on multiple factors, such as age and smoking status, use the same logic to create variable rate profiles and associated eligibility profiles for each set of factors affecting the rate.

This table shows an example of combining two criteria, age and smoking status.

Age	Smoking Status
less than 25	nonsmoker
less than 25	smoker
26 to 40	nonsmoker
26 to 40	smoker

Create the variable profiles first and then add them to the standard rate.

Exclusion From the Variable Rate

You can use the Exclude check box on the eligibility profile to exclude persons who meet the criteria from receiving the variable rate. Excluded persons receive the standard rate. For example, using Smoker as the criteria, exclude smokers from a nonsmoker discount on the standard rate.

Don't mix include and exclude criteria in a single eligibility profile.

Treatment Rule

The treatment rule specifies how the variable profile calculation acts upon the standard rate calculation. Select from these ways to treat the standard rate:

• Multiply by

• Add to

• Subtract from

• Replace

Variable Formulas

To base a variable rate on a complex calculation, you can:

1. Define one or more fast formulas to compute the rate.

2. Associate the formulas with the standard rate.

You can associate either variable rate profiles or variable formulas to a standard rate; you can't associate both.