MCMURRAY, Pa.--(BUSINESS WIRE)--In the latest Healthcare Business Strategy report, Mark Farrah Associates (MFA), www.markfarrah.com, summarized key findings from the 2016 MLR report released on December 28, 2017 by the Department of Health and Human Services (HHS). The brief focused on health plan performance as it relates to the Medical Loss Ratio, and the related rebates due to consumers.
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 rebates to their customers. The goal of this provision is to curb growth in health care premiums while ensuring that plans are adequately covering health care expenses. In 2015 health plans reimbursed customers $406 million. For 2016, health plans reimbursed customers $451 million, equating to approximately $113 per benefiting family.
Aggregated MLR premiums and rebate figures were assessed for all health plans that reported doing business in each state. For 2016, Florida led the country with nearly $70 million in total MLR rebates paid to customers, followed by Maryland. The total amount of Maryland’s rebates represented a high percentage of rebates to total adjusted premiums at .86%, up from .69% in 2015. This may indicate that health plans in Maryland spent less on medical and health care quality improvement costs as compared to premiums charged.
MFA also assessed Adjusted Premiums, MLR Rebates and Weighted Average MLRs within the Individual, Small Group and Large Group comprehensive market segments for leading health companies. 2016 MLR Rebates paid for the Individual segment were $102 million, which is .14% of the $74 billion collected in premiums. MLR Rebates for the Small Group segment were $153 million, or .22%, of the $69.5 billion for that segment. Rebates for the $205 billion Large Group segment were $190 million.
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 "The 2016 Health Insurance Medical Loss Ratio and Rebates Results: A Brief Summary," 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™.