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October 07, 2010 at 08:00 PM
Members of the Life and Health Actuarial Task Force (LHATF) have approved a draft model that could be used to implement the new Affordable Care Act minimum medical loss ratio (MLR) provisions.
The proposed model, which would serve as a template for creating a Regulation for Uniform Definitions and Standardized Rebate Calculation Methodology for Plan Years 2011, 2012 and 2013, would help states implement provisions in the Patient Protection and Affordable Care Act (PPACA), an Affordable Care Act component, that will require that the minimum amount of health coverage revenue going to medical care and quality improvement efforts be 80% for individual and small group coverage and 85% for l
arge group coverage.
Carriers that fail to spend enough revenue on health care and quality improvement are supposed to send rebates to customers.
Regulators and interest groups have engaged in vigorous debate about the precise definitions to be used in the minimum MLR model.
One term that has been the subject of intense scrutiny has been “taxes.”
In the draft approved by the LHATF, a panel at the National Association of Insurance Commissioners (NAIC), Kansas City, Mo., drafters say the phrase “Federal and State taxes and licensing or regulatory fees” refers to “those taxes and licensing or regulatory fees as defined in Appendix C and derived from the NAIC Supplemental Health Care Exhibit as adopted by the
