Adoption Premium Calculation Using Age-based Pricing

If the age-based pricing rule is effective for the health plan, the system identifies a list of members which are eligible for premium calculation in an individual membership using the fully insured pricing business rule. To identify whether the eligible adopted person should be offered adoption gift days, the system refers the adoption business rule stamped against the individual membership to derive the following parameters:

  • Gift Days Applicability

  • Gift Days

Once the eligible members for premium are identified, the system derives the base fee and applicable modifier fee for each eligible member based on its age from the age-based pricing rule. The system creates a timeline for each month from the month the adopted person is enrolled to the individual membership. For example, if the adopted person is enrolled on 01-Jun-2026 in an individual membership which is effective from 01-Jan-2026 to 31-Dec-2026, the system creates one timeline for each month starting from 01-Jun-2026 to 31-Dec-2026. The system then checks whether any adoption business rule is derived for the individual membership. If so, the system checks whether the Gift Days Applicability parameter in the adoption business rule is set to Y. If the Gift Days Applicability parameter in the adoption business rule is set to Y, the system derives the adoption gift days from the adoption business rule and does not calculate the premium for the gift period.

For example, if the adopted person with the adoption date set to 01-Jun-2026 is enrolled to an individual membership on 15-Jun-2026 and the adoption gift days is set to 30, the system considers 01-Jun-2026 to 30-Jun-2026 as the gift period (i.e., adoption date + gift days) and does not calculate premium for the eligible adopted person. In this case, the adopted person’s premium is not charged for 15 days starting from 15-Jun-2026 to 30-Jun-2026. This is because the adopted person gift days are offered from the adoption date and not from the enrollment start date. However, the premium will be charged for the adopted person from July 2026 onwards for each timeline.