MCMURRAY, Pa.--(EON: Enhanced Online News)--On November 18, 2016, the Department of Health and Human Services (HHS) released the 2015 Medical Loss Ratio (MLR) data. In the latest Healthcare Business Strategy report, Mark Farrah Associates (MFA), www.markfarrah.com, summarized key findings found within the MLR report. The brief focuses on health plan performance as it relates to the Medical Loss Ratio, and the related rebates due to consumers.
“A Brief Analysis of the 2015 Medical Loss Ratio and Rebates Results”
The Affordable Care Act’s (ACA) MLR provision requires health insurers who fail to spend specified percentages of their health care premium income to pay their customers rebates. The goal of this provision is to curb the growth in health care premiums while ensuring that plans are adequately covering healthcare expenses. In 2014 health plans reimbursed customers $469 million. For 2015, health plans showing improved management of their MLRs reimbursed customers $397 million, equating to approximately $138 per benefiting family.
Aggregated MLR premiums and rebate figures were assessed for all health plans that reported doing business in each state. For 2015, Florida led the country with approximately $47 million in total MLR rebates paid to customers, followed by New York. Though Mississippi paid $16 million in rebate disbursements in 2015, which was considerably lower than the other top states, the total amount of Mississippi’s rebates continue to represent a much higher percentage of rebates to total adjusted premiums at .93 percent. This generally indicates that health plans in the state spent less on medical and health care quality improvement costs as compared to premiums charged.
In addition, MFA assessed the Adjusted Premiums, MLR Rebates and Weighted Average MLRs within the Individual, Small Group and Large Group comprehensive market segments for leading health companies. 2015 MLR Rebates paid for the Individual segment were $107 million which is .2% of the $68 billion collected in premiums. MLR Rebates for the Small Group segment were $154 million, or .22%, of the $68.2 billion for that segment. Rebates for the $201 billion Large Group segment were $136 million. Overall, the rebates paid to consumers were a relatively small portion of industry premiums.
Subscribers to Mark Farrah Associates' Health Coverage Portal and the SHCE and MLR Data have access to this dataset with the benefit of NAIC company codes mapped to HIOS codes used for government reporting by health plans. MFA will continue to analyze and report on important ACA related topics with valuable insights about the health care industry in future Healthcare Business Strategy reports.
To read the full text of "A Brief Analysis of the 2015 Medical Loss Ratio and Rebates Results", visit the Analysis Briefs library on Mark Farrah Associates' website.
About Mark Farrah Associates (MFA)
MFA is a leading data aggregator and publisher providing health plan market data and analysis tools for the healthcare industry. Committed to simplifying analysis of health insurance business, our products include Medicare Business Online™, Medicare Benefits Analyzer™, Health Coverage Portal™, County Health Coverage™, and Health Plans USA™.