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Medical Loss Ratio (MLR) Carrier Update

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The Affordable Care Act (ACA) requires health insurers and their health plans to provide information on the portion of premium dollars spent on members’ health care services and quality improvement, known as the Medical Loss Ratio (MLR).

In the Small Group market, the law requires an MLR of 80%. That is, at least 80% of premium dollars must be spent on health care-related expenses, and no more than 20% of premium dollars may be spent on administrative expenses.  In the Large Group market, the MLR rises to 85%.

If a fully-insured health plan spends less than 80% or 85% of premium revenue on member services, it is required to provide a rebate to its members. (Note that MLR requirements do not apply to employers with self-funded plans, where the employer is responsible for payment of covered claims.)

MLR rebates are paid according to calendar year, and must be distributed by 9/30 of the following year, if applicable. Refer to W&B’s Newsroom Blog post on what to do with Medical Loss Ratio Rebate Checks in 2021 for more information on MLR requirements and rebates.

Listed below is MLR information for 2021, as provided by Word & Brown’s carrier partners. Note that this information is subject to change, and some carriers’ information is still pending. This column will be updated as more information becomes available.

Note: Information is current as of September 2021.


CARRIER
 WILL YOU BE ISSUING A MEDICAL LOSS RATIO (MLR) REBATE IN 2021 (FOR THE 2020 PLAN YEAR)? IF SO, WHAT IS THE EXPECTED DATE?
Aetna (CA) MLR rebates will be issued for eligible Aetna segments. Rebates will be distributed no later than September 30, 2021. Physical checks will be mailed to the plan sponsor, and in some cases rebates may be distributed to members directly.
Allstate Benefits (formerly National General) (CA and NV) As an ERISA product, Level-Funded Plans do not participate in the MLR regulations.
Anthem Blue Cross (CA) Anthem Blue Cross groups will receive 2020 Medical Loss Ratio (MLR) rebates this year. Rebates were mailed by the end of August 2021.
Anthem Blue Cross Blue Shield (NV) Anthem Blue Cross Blue Shield will not be issuing a rebate to Nevada customers for the 2020 plan year.
Blue Shield of California (CA) Blue Shield of California will not be issuing a rebate for the 2020 plan year.
CalCPA (CA) As a Multiple Employer Welfare Arrangement (MEWA) health plan, CalCPA Health does not have to comply with the MLR portion of the ACA.
Cigna + Oscar (CA) N/A. Cigna + Oscar did not have plans in California for the 2020 plan year.
Cigna (CA) Cigna will not be issuing an MLR rebate for the 2020 plan year.
Health Net (CA)
  • For California Individual and Large Group HMO and PPO Plans in 2020, Health Net met or exceeded the Medical Loss Ratio (MLR) standards.
  • For California Small Group Plans in 2020, Health Net Life Insurance Company (PPO) met or exceeded the 80% MLR standard.
  • For California Small Group Plans in 2020, Health Net of California, Inc. (HMO) did not meet the 80% MLR standard; the company will be issuing a check no later than September 30 (following the end of the MLR reporting year), or applying a premium credit toward the group’s first premium due on or after September 30 (following the MLR reporting year).
Kaiser Permanente (CA) California Kaiser Permanente’s Individual, Small Group, and Large Group plans satisfied the required standards for 2020. Therefore, Kaiser Permanente will not be required to issue any Affordable Care Act MLR rebates for 2020 experience.
MediExcel Health Plan (CA) MediExcel will not be issuing an MLR rebate for the 2020 plan year.
Oscar (CA) Oscar will not be issuing an MLR rebate for the 2020 plan year.
Prominence and Prominence Association Health Plans (Nevada) Prominence will not be issuing an MLR rebate for the 2020 plan year.
Sharp Health Plan (CA) Sharp Health Plan will not be issuing an MLR rebate for the 2020 plan year.
 
SIMNSA (CA) Because SIMNSA is a Mexican HMO, the MLR rebate does not apply. The state of California rule specifically applies to plans that contract for health care coverage in California; however, SIMNSA does not provide such coverage and only sells products that provide coverage in Mexico.
Sutter Health Plus (CA) Sutter Health Plus will not be issuing an MLR rebate for the 2020 plan year.
UnitedHealthcare (CA) UnitedHealthcare will be issuing an MLR rebate to eligible groups. The amount of the rebate varies by group. Rebates will be issued by check no later than September 30, 2021.
Western Health Advantage (CA) Western Health Advantage has met the MLR requirement and will not be issuing a rebate for the 2020 plan year

 
Other useful information is contained in an MLR column from September 2021, authored by Paul Roberts, Word & Brown’s Director of Education and Market Development.

If you have any MLR questions, contact your WBCompliance team by telephone or email. You can call 866-375-2039, or send an email to ComplianceSupport@wordandbrown.com.


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