Common use of Actuarially Sound Rate Representation Clause in Contracts

Actuarially Sound Rate Representation. The Department represents that actuarially sound Capitation rates were developed by the Department’s contracted actuarial firm and that Capitation rates paid hereunder are actuarially sound. The rates were developed from the Fee-For-Service equivalent values to be consistent with the Federal regulations promulgated pursuant to the Balanced Budget Act of 1997. The Fee-For-Service equivalent values were modified to reflect the following adjustments: (i) completion factors, (ii) inpatient outlier adjustments, (iii) managed care adjustments, (iv) contractual adjustments, (v) trend rates, (vi) administrative allowance, (vii) Third Party liability recoveries, and (viii) PCP management fee adjustment.