Scenario B
This scenario explains the effect of premium recalculations on the financial transactions. This scenario explains situations that can arise when initial version(s) of the transactions are in different financial processing steps.
Situation 1: Initial version of the financial transactions is processed and financial message generation is complete
Policy 1002
Policy 1002 has the following properties:
- Policy Code
-
POL1002
- Group Account
-
-
- Collection Frequency
-
2 [1]
- Member
-
2110113 (lives in a state where a regional tax applies)
- Enrollment Product
-
BASIC PLAN with start date 01-Jan-2015
- Add-on
-
Preventive Care with start date 01-Jan-2015
Suppose for this policy the following premium calculation results and financial data exist.
| Scenario A uses percentages to calculate add-on premiums, taxes and surcharges. This scenario only uses a percentage for the regional tax. All other amounts are are fixed amounts. |
Calculation Results
Calculation Result
| Policy Code | Policy Version | Calculation Result Version | Calculation Period | Total Base Premium | Total Adjustment | Total Surcharge | Total Result |
|---|---|---|---|---|---|---|---|
POL0001002 |
1 |
1 |
Jan'15 |
110.00 |
-5.00 |
4.00 |
109.00 |
POL0001002 |
1 |
1 |
Feb'15 |
110.00 |
-5.00 |
4.00 |
109.00 |
Calculation Result Lines
| Calculation Result | Seq. | Input Amount | % | Result Amount | Add-on | Schedule Definition |
|---|---|---|---|---|---|---|
Jan'15 |
1 |
- |
- |
105.00 |
BASIC PLAN Premium |
|
2 |
- |
- |
5.00 |
Preventive Care |
||
3 |
110.00 |
2.5 |
2.75 |
Regional Tax |
||
4 |
- |
- |
-5.00 |
Office Visit Co-payment |
||
5 |
- |
- |
1.25 |
Surcharge |
||
Feb'15 |
1 |
- |
- |
105.00 |
BASIC PLAN Premium |
|
2 |
- |
- |
5.00 |
Preventive Care |
||
3 |
110.00 |
2.5 |
2.75 |
Regional Tax |
||
4 |
- |
- |
-5.00 |
Office Visit Co-payment |
||
5 |
- |
- |
1.25 |
Surcharge |
Financial Data
The financial transactions have been processed to generate the financial message on 08-Jan-2015.
Base Financial Object
| Calculation Period Start Date | Policy GID | Status |
|---|---|---|
01-Jan-2015 |
1002 |
Financial Message Handled |
01-Feb-2015 |
1002 |
Financial Message Handled |
Financial Transaction
| Version | Reversal | Financial Transaction Set | Financial Message Handled Datetime | Financial Message Result |
|---|---|---|---|---|
1 |
N |
Premium Calculation Jan'15 |
08-Jan-2015 |
M |
1 |
N |
Premium Calculation Jan'15 |
08-Jan-2015 |
M |
Now, the member with code 2110113 updates his address, and the new address is effective 01-Jan-2015. For this new address no regional tax applies.
The change of address creates a mutation event with an effective date of 01-Jan-2015. When premium calculation with the input calculation period Feb'15 is performed, the calculation periods Jan'15 and Feb'15 are recalculated. This results in the following new calculation results and financial data.
| The address change is not a change on the policy. The policy version stays 1. |
Calculation Results
Calculation Results
| Policy Code | Policy Version | Calculation Result Version | Calculation Period | Total Base Premium | Total Adjustment | Total Surcharge | Total Result |
|---|---|---|---|---|---|---|---|
POL1002 |
1 |
2 |
Jan'15 |
110.00 |
-5.00 |
1.25 |
106.25 |
POL1002 |
1 |
2 |
Feb'15 |
110.00 |
-5.00 |
1.25 |
106.25 |
Calculation Result Lines
| Calculation Result | Seq. | Input Amount | % | Prorate Factor | Result Amount | Add-on | Schedule Definition |
|---|---|---|---|---|---|---|---|
Jan'15 |
1 |
- |
- |
- |
105.00 |
BASIC PLAN Premium |
|
2 |
- |
- |
- |
5.00 |
Preventive Care |
||
3 |
- |
- |
- |
-5.00 |
Office Visit Co-payment |
||
4 |
- |
- |
- |
1.25 |
Surcharge |
||
Feb'15 |
1 |
- |
- |
- |
105.00 |
BASIC PLAN Premium |
|
2 |
- |
- |
- |
5.00 |
Preventive Care |
||
3 |
- |
- |
- |
-5.00 |
Office Visit Co-payment |
||
4 |
- |
- |
- |
1.25 |
Surcharge |
Financial Data
The system creates a reversal financial transaction for version 1 and financial transaction version 2 for both the calculation periods Jan'15 and Feb'15.
Base Financial Object
| Calculation Period Start Date | Policy GID | Status |
|---|---|---|
01-Jan-2015 |
1002 |
Financial Message Handled |
01-Feb-2015 |
1002 |
Financial Message Handled |
Financial Transaction
Input Calculation Period Start Date |
Policy Version |
Reversal? |
Total Amount |
Fin Transaction Version |
Superseded? |
Financial Message Bulking Group |
Financial Message ID |
Financial Message Result |
01-Jan-2015 |
1 |
Y |
-109.00 |
1 |
N |
- |
- |
- |
01-Jan-2015 |
1 |
N |
106.25 |
2 |
N |
- |
- |
- |
01-Feb-2015 |
1 |
Y |
-109.00 |
1 |
N |
- |
- |
- |
01-Feb-2015 |
1 |
N |
106.25 |
2 |
N |
- |
- |
- |
The Financial Transaction Details corresponding to the new financial transactions of the Base Financial Object for the calculation period Jan'15 are as follows:
| Version | Reversal | Component Code | Member Code | Product Code | Amount | Seq. Number | Invoice Indicator | Invoice Line Grouping Indicator | Accounting Detail Grouping Indicator |
|---|---|---|---|---|---|---|---|---|---|
1 |
Y |
BASIC PLAN |
2110113 |
BASIC PLAN |
-105.00 |
1 |
Y |
N |
N |
Preventive Care |
2110113 |
BASIC PLAN |
-5.00 |
2 |
Y |
N |
N |
||
Regional Tax |
2110113 |
BASIC PLAN |
-2.75 |
3 |
Y |
N |
N |
||
Office Visit Co-payment |
2110113 |
BASIC PLAN |
5.00 |
4 |
Y |
N |
N |
||
Surcharge |
2110113 |
BASIC PLAN |
-1.25 |
5 |
Y |
N |
N |
||
2 |
N |
BASIC PLAN |
2110113 |
BASIC PLAN |
105.00 |
1 |
Y |
N |
N |
Preventive Care |
2110113 |
BASIC PLAN |
5.00 |
2 |
Y |
N |
N |
||
Office Visit Co-payment |
2110113 |
BASIC PLAN |
-5.00 |
3 |
Y |
N |
N |
||
Surcharge |
2110113 |
BASIC PLAN |
1.25 |
4 |
Y |
N |
N |
Similar Financial Transaction Details are also created for the Base financial Object for Feb'15 for this policy (GID).
Financial Processing
The financial processing starts by executing Select Financial Transactions into a new Financial Transaction Set. In this example we execute this activity with the parameter Financial Transaction Set Code 'Premium Calculation Feb'15.
| Adding the financial transactions to a new Financial Transaction Set is possible because there is no unprocessed financial transaction that belongs to the same policy and is present in any other open set. |
The system sets the status of the Base Financial Objects to 'Changed'
Base Financial Object
| Calculation Period Start Date | Policy GID | Status |
|---|---|---|
01-Jan-2015 |
1002 |
Changed |
01-Feb-2015 |
1002 |
Changed |
Financial Transaction
| Calculation Period Start Date | Version | Reversal | Financial Transaction Set | Superseded? | Financial Message Handled Datetime | Financial Message Result |
|---|---|---|---|---|---|---|
01-Jan-2015 |
1 |
Y |
Premium Calculation Feb'15 |
N |
||
01-Jan-2015 |
2 |
N |
Premium Calculation Feb'15 |
N |
||
01-Feb-2015 |
1 |
Y |
Premium Calculation Feb'15 |
N |
||
01-Feb-2015 |
2 |
N |
Premium Calculation Feb'15 |
N |
The next activity - Supersede Financial Transaction is then performed on the Financial Transaction Set -Premium Calculation Feb'15. The financial transactions version 1 for all the base financial objects are processed and are already part of the financial message, therefore, they cannot be superseded. So, in this situation, no financial transactions within Financial Transaction Set -Premium Calculation Feb'15 are superseded. At the end of this activity the status of the Base Financial Object is set to Supersede and Reversal done.
The next step is to Generate Financial Message. In this example we run the Generate Financial Message activity on 08-Feb-2015.
The Financial Transaction Process Data does not specify a financial message bulking group. Therefore the system groups the financial transactions related to a Policy into one message. The financial transactions of Jan'15 and Feb'15 are grouped into one financial message. The contents of the various parts of the financial message are as follows
Financial Message
The contents of the various parts of the financial message are as follows:
Financial Message
| Job ID | Message Date | Message Bulking Group |
|---|---|---|
132532 |
08-Feb-2015 |
1002 |
Financial Message - Invoice
There is no invoice bulking group specified, so only one invoice is created. The invoice amount is the sum of all the invoice lines.
| ID | Invoice Type | Invoice Amount |
|---|---|---|
89071 |
Standard |
-5.50 |
Financial Message - Invoice Line
For each financial transaction detail, an invoice line is created
| Invoice Line ID | Line Number | Line Type | Amount |
|---|---|---|---|
123587 |
1 |
ITEM |
-105.00 |
123588 |
2 |
ITEM |
-5.00 |
123589 |
3 |
ITEM |
-2.75 |
123590 |
4 |
ITEM |
5.00 |
123591 |
5 |
ITEM |
-1.25 |
123592 |
6 |
ITEM |
105.00 |
123593 |
7 |
ITEM |
5.00 |
123594 |
8 |
ITEM |
-5.00 |
123595 |
9 |
ITEM |
1.25 |
123596 |
19 |
ITEM |
-105.00 |
… |
… |
… |
… |
123603 |
26 |
ITEM |
-5.00 |
123604 |
27 |
ITEM |
1.25 |
Financial Message - Accounting Details
| Accounting Detail ID | Ledger ID | Accounting Date | Amount |
|---|---|---|---|
8719064 |
32423432 |
01-Feb-2015 |
-105.00 |
8719065 |
32423432 |
01-Feb-2015 |
-5.00 |
8719066 |
32423430 |
01-Feb-2015 |
-2.75 |
8719067 |
32423431 |
01-Feb-2015 |
5.00 |
8719068 |
32423430 |
01-Feb-2015 |
-1.25 |
8719069 |
32423432 |
01-Feb-2015 |
105.00 |
8719070 |
32423432 |
01-Feb-2015 |
5.00 |
8719071 |
32423431 |
01-Feb-2015 |
-5.00 |
8719072 |
32423430 |
01-Feb-2015 |
1.25 |
8719073 |
32423432 |
01-Feb-2015 |
-105.00 |
… |
… |
… |
.. |
8719080 |
32423431 |
01-Feb-2015 |
-5.00 |
8719081 |
32423430 |
01-Feb-2015 |
1.25 |
As the final step of creating the financial message, the system updates Financial Transaction Detail Process Data with the details of the invoice id, invoice line id and accounting detail id. The system also updates the Financial Transaction Process Data with the financial message creation datetime and financial message result.
The tables below show the results of the two calculation and financial processing rounds.
Base Financial Object
| Calculation Period Start Date | Policy GID | Status |
|---|---|---|
01-Jan-2015 |
1002 |
Financial Message Handled |
01-Feb-2015 |
1002 |
Financial Message Handled |
Financial Transaction
| Calculation Period Start Date | Version | Reversal | Financial Transaction Set | Superseded? | Financial Message Handled Datetime | Financial Message Result |
|---|---|---|---|---|---|---|
01-Jan-2015 |
1 |
N |
Premium Calculation Jan'15 |
N |
08-Jan-2015 |
M |
01-Jan-2015 |
1 |
Y |
Premium Calculation Feb'15 |
N |
08-Feb-2015 |
M |
01-Jan-2015 |
2 |
N |
Premium Calculation Feb'15 |
N |
08-Feb-2015 |
M |
01-Feb-2015 |
1 |
N |
Premium Calculation Jan'15 |
N |
08-Jan-2015 |
M |
01-Feb-2015 |
1 |
Y |
Premium Calculation Feb'15 |
N |
08-Feb-2015 |
M |
01-Feb-2015 |
2 |
N |
Premium Calculation Feb'15 |
N |
08-Feb-2015 |
M |
Situation 2: Initial version is superseded, financial message is yet to be generated
In the above situation, we processed the financial transactions created by the premium calculation for input calculation period 01-Jan-2015 and we generated the financial message.
Now, if the premium calculation for input calculation period Feb'15 is executed before the financial transactions for premium calculation for input calculation period Jan'15 are processed by the Generate Financial Message activity, then the following situation arises.
Base Financial Object
| Calculation Period Start Date | Policy GID | Status |
|---|---|---|
01-Jan-2015 |
1002 |
Supersede and Reversal Done |
01-Feb-2015 |
1002 |
Supersede and Reversal Done |
Financial Transaction
| Calculation Period Start Date | Version | Reversal | Financial Transaction Set | Superseded? | Financial Message Handled Datetime | Financial Message Result |
|---|---|---|---|---|---|---|
01-Jan-2015 |
1 |
N |
Premium Calculation Jan'15 |
N |
||
01-Jan-2015 |
1 |
Y |
N |
|||
01-Jan-2015 |
2 |
N |
N |
|||
01-Feb-2015 |
1 |
N |
Premium Calculation Jan'15 |
N |
||
01-Feb-2015 |
1 |
Y |
N |
|||
01-Feb-2015 |
2 |
N |
N |
In order to process the new financial transactions, they must be added to a Financial Transaction Set.
It is not possible to put the financial transaction version 2 and the reversal financial transaction of version 1 for the Jan'15 and Feb'15 into a new Financial Transaction Set. There are unprocessed financial transactions in the Financial Transaction Set - Premium Calculation Jan'15 for the same policy. Therefore we run the activity 'Select Financial Transaction into existing Set' within the context of Financial Transaction Set - Premium Calculation Jan'15 to add the new financial transactions to it.
After running this activity, the financial transaction version 2 and reversal financial transaction of version 1 are now part of the Financial Transaction Set - Premium Calculation Jan'15 and the Base Financial Object’s status is set to 'Changed'.
Base Financial Object
| Calculation Period Start Date | Policy GID | Status |
|---|---|---|
01-Jan-2015 |
1002 |
Changed |
01-Feb-2015 |
1002 |
Changed |
Financial Transaction
| Calculation Period Start Date | Version | Reversal | Financial Transaction Set | Superseded? | Financial Message Handled Datetime | Financial Message Result |
|---|---|---|---|---|---|---|
01-Jan-2015 |
1 |
N |
Premium Calculation Jan'15 |
N |
||
01-Jan-2015 |
1 |
Y |
Premium Calculation Jan'15 |
N |
||
01-Jan-2015 |
2 |
N |
Premium Calculation Jan'15 |
N |
||
01-Feb-2015 |
1 |
N |
Premium Calculation Jan'15 |
N |
||
01-Feb-2015 |
1 |
Y |
Premium Calculation Jan'15 |
N |
||
01-Feb-2015 |
2 |
N |
Premium Calculation Jan'15 |
N |
Next, we run the activity Supersede Financial Transaction within the context of the Financial Transaction Set - Premium Calculation Jan'15. The activity supersedes the financial transaction version 1 and the reversal financial transaction of version 1, that is their Indicator Supersede is set to Yes. The activity sets the Base Financial Object status to 'Supersede and Reverse Done'.
Base Financial Object
| Calculation Period Start Date | Policy GID | Status |
|---|---|---|
01-Jan-2015 |
1002 |
Supersede and Reverse Done |
01-Feb-2015 |
1002 |
Supersede and Reverse Done |
Financial Transaction
| Calculation Period Start Date | Version | Reversal | Financial Transaction Set | Superseded? | Financial Message Handled Datetime | Financial Message Result |
|---|---|---|---|---|---|---|
01-Jan-2015 |
1 |
N |
Premium Calculation Jan'15 |
Y |
||
01-Jan-2015 |
1 |
Y |
Premium Calculation Jan'15 |
Y |
||
01-Jan-2015 |
2 |
N |
Premium Calculation Jan'15 |
N |
||
01-Feb-2015 |
1 |
N |
Premium Calculation Jan'15 |
Y |
||
01-Feb-2015 |
1 |
Y |
Premium Calculation Jan'15 |
Y |
||
01-Feb-2015 |
2 |
N |
Premium Calculation Jan'15 |
N |
The Generate Financial Message activity only considers the (not superseded) financial transactions version 2 for financial message generation. In this example we run the Generate Financial Message on 08-Feb-2015. The contents of the various parts of the financial message are as follows:
Financial Message
| Job ID | Message Date | Message Bulking Group |
|---|---|---|
132533 |
08-Feb-2015 |
1002 |
Financial Message - Invoice
There is no invoice bulking group specified, so all financial transactions are grouped in one invoice. The invoice amount is the sum of all the invoice lines.
| ID | Invoice Type | Invoice Amount |
|---|---|---|
89071 |
Standard |
212.50 |
Financial Message - Invoice Line
For each financial transaction detail, an invoice line is created
| Invoice Line ID | Line Number | Line Type | Amount |
|---|---|---|---|
123592 |
1 |
ITEM |
105.00 |
123593 |
2 |
ITEM |
5.00 |
123594 |
3 |
ITEM |
-5.00 |
123595 |
4 |
ITEM |
1.25 |
… |
… |
… |
… |
123599 |
12 |
ITEM |
1.25 |
Financial Message - Accounting Details
| Accounting Detail ID | Ledger ID | Accounting Date | Amount |
|---|---|---|---|
8719064 |
32423432 |
01-Feb-2015 |
105.00 |
8719065 |
32423432 |
01-Feb-2015 |
5.00 |
8719066 |
32423431 |
01-Feb-2015 |
-5.00 |
8719067 |
32423430 |
01-Feb-2015 |
1.25 |
… |
… |
… |
… |
8719071 |
32423430 |
01-Feb-2015 |
1.25 |
After creating the financial message, the system updates the Financial Transaction Detail Process Data with the invoice id, invoice line id and accounting detail id. The system also updates the financial message handled date and time and financial message result on the Financial Transaction Process Data.
Base Financial Object
| Calculation Period Start Date | Policy GID | Status |
|---|---|---|
01-Jan-2015 |
1002 |
Financial Message Handled |
01-Feb-2015 |
1002 |
Financial Message Handled |
Financial Transaction
| Calculation Period Start Date | Version | Reversal | Financial Transaction Set | Superseded? | Financial Message Handled Datetime | Financial Message Result |
|---|---|---|---|---|---|---|
01-Jan-2015 |
1 |
N |
Premium Calculation Jan'15 |
Y |
08-Feb-15 |
S |
01-Jan-2015 |
1 |
Y |
Premium Calculation Jan'15 |
Y |
08-Feb-15 |
S |
01-Jan-2015 |
2 |
N |
Premium Calculation Jan'15 |
N |
08-Feb-15 |
M |
01-Feb-2015 |
1 |
N |
Premium Calculation Jan'15 |
Y |
08-Feb-15 |
S |
01-Feb-2015 |
1 |
Y |
Premium Calculation Jan'15 |
Y |
08-Feb-15 |
S |
01-Feb-2015 |
2 |
N |
Premium Calculation Jan'15 |
N |
08-Feb-15 |
M |
Situation 3: Initial version is added to a Financial Transaction Set, the activities to follow are yet to be executed
The financial message generated in this situation for the policy POL1002 will be the same as in the situation 2. In this situation, the financial transaction version 2 and reversal financial transaction corresponding to version 1 must be added to the Financial Transaction Set - Premium Calculation Jan'15 as there are unprocessed financial transactions that belong to the same policy (GID) already present in this set.
In situation 2, if there are superseded transactions when new financial transaction are being added to the set, then the indicator supersede is reset for all those financial transaction traversing backward from the current version of the financial transaction up to the financial transaction with the financial message mandatory indicator set to Y or the financial transaction that was handled by the generate financial message activity - whichever one comes first. This step is not applicable for situation 3 as the initial financial transactions have not been processed by the Supersede Financial Transaction activity yet.
Situation 4: Initial version is not yet added to a Financial Transaction Set
In this situation the financial message for the policy POL1002 will be similar to the one generated in Situation 2. However, the difference with respect to situation 2 is that the financial transactions can be added into any existing open Financial Transaction Set or a new Financial Transaction Set. Adding financial transactions into a new Financial Transaction Set is not possible in situation 2.