The Maryland Insurance Administration will hold a public hearing to discuss the reserve levels of Owings Mills, Md.-based CareFirst and its Group Hospitalization and Medical Service’s subsidiary Nov. 19.

The hearing will be held more than two weeks after state regulators are scheduled to release a report (Nov. 4) prepared by Invotex Group, an actuarial firm hired by the agency to look at the methodology and size of the insurer’s surplus.

A similar review was recently completed in Washington, D.C., with regulators there postponing a determination on whether GHMSI’s reserves are “unreasonably large” under District law, requiring a return of premium dollars.

Last month, District regulators announced they would delay their verdict until the end of the year to take Maryland’s findings into consideration following two days of testimony from the insurer’s representatives and others.

Ralph S. Tyler

GHMSI, with a current reserve of $687 million, covers about 150,000 policyholders in the District, 700,000 in Maryland and 300,000 in Northern Virginia.

“As a standard part of our regulatory function of protecting consumers, we want to ensure that CareFirst is financially viable today and into the future for its policyholders,” Maryland Insurance Commissioner Ralph S. Tyler said in a statement. “This review of CareFirst surplus will offer a valuable framework for looking at the financial status and operational conditions of the company and better guidance on future decisions regarding oversight of this unique company.”

The MIA said the review of CareFirst and GHMSI reserves was commissioned to evaluate whether current statutory reserve requirements are adequate to protect policyholders and to recommend a regulatory framework for reviewing and determining when the surplus for both companies on an individual or consolidated bases has become excessive.

The hearing will be held Thursday, Nov. 19, at 9 a.m. in the MIA Hearing Room at 200 St. Paul Plaza in Baltimore, Md. The hearing will include a presentation by Invotex Group on its report with representatives from CareFirst and the public able to respond.