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4 Ways to Boost Your MLR Waiver Request's Chances

Margaret Dick Tocknell, for HealthLeaders Media, February 29, 2012

In mid-February the Centers for Medicaid & Medicare Services wrapped up its work on the 2011 medical loss ratio waiver requests by denying Wisconsin's waiver request and partially granting North Carolina's.

The MLR, mandated by the Patient Protection and Affordable Care Act, requires that health insurers spend no more than 20% of their annual premium dollars for individual and small group policies on administrative expenses beginning in 2011. Large groups are restricted to 15%. Plans that don't meet the MLR standard must provide a rebate to their customers.

There's big money involved—about $323 million in the first year alone—according to federal officials. Insurers are expected to pay the first round of rebates by due to be paid by August 1st.

At the behest of health insurers, several states took a stab at getting the MLR requirement delayed or reduced to give payers time to adjust to the new MLR reality. In case you're keeping track, here's the scorecard:

  • Only 17 states and Guam filed MLR waiver requests in 2011
  • CMS granted waiver requests for Georgia, Iowa, Kentucky, Maine, Nevada, New Hampshire and North Carolina.
  • It denied waivers for Guam and Delaware, Florida, Indiana, Kansas, Louisiana, Michigan, Oklahoma, North Dakota, Texas and Wisconsin.
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