Some U.S. health insurers clearly had disappointing results in 2014.
Some insurers said they were doing fine, and the biggest insurers reported solid 2014 profits.
The apparently conflicting reports have raised questions about just how well, or how poorly, health insurers did in 2014, especially in the individual health insurance market, which was directly affected by new Patient Protection and Affordable Care Act (PPACA) benefits mandates and underwriting restrictions starting in 2014.
Mark Farrah Associates (MFA) has now published a review of 2014 medical loss ratio (MLR) data that implies that carriers in some states might have done a good job of setting premiums at a high enough level to generate underwriting gains.
PPACA now requires carriers to spend 85 percent of large-group health revenue, and 80 percent of individual and small-group revenue, on health care and quality improvement efforts. Carriers that miss the mark, and earn what the government views as being too big of a profit margin, must send rebates to the enrollees.
Nationwide, the rebate total for all types of health coverage increased 42 percent between 2013 and 2014, to $478 million, according to the MFA analysts.
The size of the average rebate paid increased to $129, from $80.
MFA analysts did not calculate separate totals for the individual, small-group and large-group markets, and they did not try to distinguish between MLRs for grandfathered coverage, fully PPACA-compliant coverage or other types of coverage.