Final Regulation on Medical Loss Ratio Reporting and Rebates: Good for Consumers

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<p>Last week the U.S. Department of Health and Human Services (HHS) issued final regulations governing the Affordable Care Act's medical loss ratio (MLR) requirements on the percentage of enrollees' premiums that health plans spend on medical care versus administration and profits.</p>
<p>In a <a href="/blog/2011/final-regulation-medical-loss-ratio-reporting-and-rebates-good-consumers">new blog post</a>, The Commonwealth Fund's Sara R. Collins, Ph.D., and Tracy Garber present an analysis of the rule for the MLR provision, which requires plans in the large-employer group market that spend less than 85 percent of their premiums on medical care and quality improvement activities, and plans in the small-employer group and individual markets that spend less than 80 percent on the same, to offer rebates to enrollees based on their 2011 MLR reports. HHS estimates that in 2012, up to 9 million people might be eligible for rebates worth from $600 million to $1.4 billion. </p>
<p>Collins and Garber also provide a table showing the status of state MLR waivers for the individual market, including states' requests for a phase-in of the requirement and HHS's decision on the percentage of premiums carriers are required to spend on medical claims in those states. </p>
<p>"The Affordable Care Act's MLR requirements for health insurance plans are an important way that the law improves the value consumers receive for their health insurance payments and will place downward pressure on premiums over time," the authors write. <br /></p>