July 28, 2021
What to Expect: Affordable Care Act (ACA) 2020 Medical Loss Ratio (MLR) Rebates
Blue Cross and Blue Shield of Illinois (BCBSIL) filed its MLR report with the U.S. Department of Health and Human Services for the 2020 MLR reporting year.
We will provide MLR rebates in the Illinois individual market because we didn’t meet or exceed the ACA’s MLR standard in that market for the 2020 MLR reporting year.
Reminder: What is the ACA’s MLR?
In general, the ACA’s MLR is the percentage of insurance premium dollars that a health insurer spends on health care services and expenses reported as activities to improve health care quality.
MLR standards. The ACA set MLR standards for health insurers. For the 2020 MLR reporting year, the MLR standard for the Illinois:
- Large Group market is 85%
- Individual and Small Group markets is 80%
The ACA’s commercial MLR standards apply to certain fully insured health insurance coverages in the Group and Individual markets. They don't apply to self-insured group health plans (ASO) or to Medicare and Medicaid.
If an insurer’s MLR doesn’t meet or exceed the ACA’s MLR standard in a certain market segment of a state, the insurer may provide MLR rebates in that market.
2020 MLR rebates to be provided by Sept. 30, 2021
If eligible for an MLR rebate for the 2020 MLR reporting year, we will provide MLR rebates by Sept. 30, 2021.
Review sample cover letters and 2020 MLR rebate notices for BCBSIL and the Illinois individual market:
Details about the ACA’s MLR and the 2020 MLR reporting year will be posted at bcbsil.com/mlr.
Key questions about the ACA’s MLR
Q. To which plans do the ACA’s commercial MLR standards apply?
A.
- The ACA’s commercial MLR standards apply to certain fully insured health insurance coverages in the group and individual markets.
- They don't apply to self-insured group health plans or to Medicare and Medicaid.
Q. For purposes of the ACA’s MLR, what types of activities are considered to be quality improvement activities?
A. Among other things, activities to improve quality of care are designed to improve health outcomes for members. For example, these activities may include:
- Enhance patient safety
- Promote health and wellness
- Improve transparency
- Support meaningful use of health information technology, or
- Prevent hospital readmissions
In general, these activities are aligned with criteria developed by professional medical associations, government agencies, accreditation bodies and other nationally recognized health care quality organizations.
Q. Why are you providing MLR rebates in the Illinois individual market?
A. We are providing MLR rebates in the Illinois individual market because we didn’t meet or exceed the ACA’s MLR standard in that market for the 2020 MLR reporting year.
Q. When will any MLR rebates be provided?
A. If eligible for an MLR rebate for the 2020 MLR reporting year, MLR rebates will be provided by Sept. 30, 2021.
Q. How will any MLR rebates be distributed?
A. In general, MLR rebates may be issued in the form of a check or premium credit.
- For MLR rebates provided by check, the check will be included with the MLR notice.
- For MLR rebates provided by premium credit, the amount will be applied as a credit to the balance that is due on the next bill that will be sent to the member after the premium credit amount is determined. If the credit is larger than the amount due on the next bill, the remaining MLR rebate balance will be applied to subsequent monthly bill(s). If the coverage has recently ended, the member may receive a check instead of having a credit applied to the next bill.
Q. If a member is enrolled in auto bill pay, will receiving an MLR rebate via premium credit impact the amount withdrawn from their account?
A. Yes, the premium credit will reduce the amount that is withdrawn for that month. The member will receive a notice that their auto bill pay amount will change.
Q. Where can producers go for more information about 2020 MLR rebates?
A. Retail producers can direct their clients to call member services at 855-310-0570 if they have questions about the ACA’s MLR.
