Over the course of writing several news stories about the MLR I've had the chance to review all of the waiver applications. With the 2012 waiver application season beginning April 1, I thought now would be a good time to offer some advice to state and health plan officials on how to develop a strong case for an MLR waiver:
1. Make sure insurers want/need an MLR adjustment.
When CMS turned down North Dakota's waiver application, it quoted a letter from the state's dominant insurer, Blue Cross Blue Shield of North Dakota, asking the insurance department to withdraw its waiver request.
2. Provide real proof that the MLR will destabilize the individual market.
CMS hears this one a lot. In denying Florida's waiver CMS officials noted that with more than 20 carriers, the state had a very competitive individual health insurance market that would be just fine. Here's the kicker: Most of the insurers in the state already meet the new MLR standards.
3. Don't exaggerate the effects of the MLR.
Lots of states have fretted that the new MLR requirements would force insurers to leave their state. Some even named names. But if you plan to use this reason to win a waiver, make sure your case is solid. The problem is the information can be easily checked.
Wisconsin officials contended that two carriers left the market because of the MLR standards. CMS reviewed the withdrawal letters and noted that the carriers had fewer than 1,000 lives and wouldn't come even be subject to the new requirements.