Insurance Companies are now required to  at least spend 80 percent of premium dollars on medical services.  If they don't, they have to give refunds.
^{(health care.gov)} This is expected to be 1.3 Billion in 2012!^{LATimes 4.27.2012}

The Medical Loss Ratio (MLR) requirements of Patient Protection and Affordable Care Act (PPACA) ENSURES THAT YOU GET VALUE FOR YOUR PREMIUM PAYMENTS

Blue Shield is voluntarily limiting net income to 2% and giving refunds.

Health Care Costs 101 chcf.org/	UHC 2 Page Summary

General highlights of the regulations include:

• Rate Increases must be certified by an Actuary ^{CA SB 1163}
• MLR (Medical Loss Ratio) rebates will be sent to policyholders, which include employers or employee organizations as well as individual plan policyholders.
  • Insurers may distribute rebates to employers; in turn, employers would need to issue rebates to employees, based on employee contributions.
• Policyholders are potentially eligible for a rebate determined on a "block" basis. The "block" is defined by:
  • Organization size (individual; small or large employer group)
  • Legal entity issuing coverage
  • State of issuance
  • Limited medical and expatriate international plans handled separately
• Small group is defined as 2-50 employees unless a state defines it differently until at least 2016.
• For the 2011 reporting year, issuers of limited medical (mini-med) and expatriate international plans are subject to separate calculation rules.
  • The plan's numerator of the total claims incurred and expenditures for activities that improve health care quality would be multiplied by two.
  • Carriers will be required to complete additional quarterly reporting through 2011.
  • After reviewing this additional reporting, these adjustments will be revisited by the Secretary for 2012 and beyond.
• Broker commissions will be included in the MLR calculation.
• Non-U.S. insurance companies do not file MLR.

A preliminary analysis of the regulation and the data from this survey support four key points:

• Initial compliance costs (especially accounting, auditing, and contracts with providers and employers) will likely exceed the estimates that accompanied the regulation by a substantial amount for many health plans.
• Plans serving the individual and small-group markets are the most likely to be affected.
• There is no guarantee that the federal MLR rule will lower health costs and premiums. In fact, the incentives under the rule may lead to higher administrative costs, higher-cost benefits, and higher premiums.
• The rule could reduce the number of health plans competing in some markets. ^{ahip hi wire.org}

The rate review process

Consumer Links

hhs.gov.

health care.gov

CIGNA's informed on reform.com

Blue Cross Memo on MLR - Medical Loss Ratio's 12/3/2010

Health Net Renewal Guide

Section 2718 900 pages

CA DOI Health Insurance Rate Filings

Steve's Highlights of Blue Cross 7.2012 Small Group Filing

Plain Language Rate Filings

Technical Links

Subpart B--CALCULATING AND PROVIDING THE REBATE

Subpart C - Potential Adjustment

Subpart D--HHS ENFORCEMENT

Subpart E--ADDITIONAL REQUIREMENTS ON ISSUERS

Subpart F--FEDERAL CIVIL PENALTIES

Bookmarks

Rate Review