Tag Archives: Esther Blount

MLR rebate considerations for ACA health plans

Many issuers faced financial challenges in the individual market in the first few years of the Patient Protection and Affordable Care Act (ACA). The continually changing landscape made it difficult to keep up even after significant rate increases, and issuers repeatedly reported medical loss ratios (MLRs) well above sustainable targets.

As experience emerges for plan year 2018, the tides are changing. A number of issuers filed rate decreases across the marketplace for plan year 2019 and new market entrants are appearing once again, a sign of a more stable market with potential for profitability. MLRs are projected to approach, and potentially to drop below, the 80% threshold for the individual market, on average. As the average MLR continues to decrease, the portion of ACA issuers below the MLR threshold continues to increase.

As MLRs decrease, individual ACA issuers need to start thinking about something that has been mostly irrelevant for them until now—MLR rebates. Although MLR rebate requirements have applied in several markets since 2011, the individual ACA market is unique in that high MLRs have prevented rebates from entering the equation for the majority of issuers since the ACA’s inception.

MLR rebates were introduced in the ACA market with the goals of stabilizing the market and providing customer protection by returning money back to policyholders when an issuer’s MLR reflects high profitability, administrative inefficiencies, or low claim levels not otherwise reflected in premium.

To learn more about MLR considerations for the 2018 reporting year and how to plan for 2019 and beyond, read this paper by Milliman’s Esther Blount, Michelle Klein, and Alison Fasching.

Consumer transparency issues in an evolving individual health insurance market

Consumers in the individual and small group health insurance markets want to understand the future of their health insurance. This paper by Milliman actuaries Esther Blount and Andrew Bourg highlights the steps the Patient Protection and Affordable Care Act (ACA) has in place to promote consumer knowledge in the individual market and the pros and cons of removing such initiatives.

Reducing CSR-related cash-flow strain

Disparities in results between the cost-sharing reduction (CSR) advance payment formula and the actual CSR payment can strain an insurer’s cash flow. Insurers can request a revised payment from the U.S. Department of Health and Human Services (HHS) if they can demonstrate a substantial difference during the plan year supported by an actuarial certification. In this paper, Milliman consultants Esther Blount, Frederick Busch, and Scott Weltz discuss what is required to receive more accurate payments throughout the year.