The Michigan Office of Financial and Insurance Regulation is asking for comments about how the new federal medical loss ratio (MLR) rules might affect individual consumers, insurers and agents.
Comments are due 5 p.m. Dec. 10, and they “should be brief, specific, focused on the Michigan health insurance marketplace,” Michigan office officials say in a notice about the MLR request for comments.
The U.S. Department of Health and Human Services (HHS) released the minimum MLR interim final regulations Nov. 22.
The regulations implement provisions in the Affordable Care Act, the legislative package that includes the Patient Protection and Affordable Care Act (PPACA), that will require that 85% of large group premium revenue and 80% of individual and small group premium revenue go to medical care and quality improvement efforts. Starting in 2012, plans that miss the mark are supposed to send customers rebates.
The PPACA rules will let HHS officials adjust the minimum MLR percentage with “respect to a State if [HHS] determines that the application of such 80 percent may destabilize the individual market in such State,” Michigan officials note.
Only a state insurance regulator can ask HHS for an MLR adjustment, and a state regulator who is asking for an adjustment must provide data supporting the request and a proposal for an alternative ratio, officials say.
“Only the 80% ratio may be adjusted and only when the 80% ratio
‘may destabilize the individual market’ in the state requesting the exemption,” officials say. “The exemption is not a waiver of all loss ratios.”
The adjustments will be granted on a state-wide basis, and not to individual insurers, officials say.