Small Group News
Published August 10, 2020
We’re required to send this rebate to the employer or group policyholder. All subscribers (your clients employees) under this plan will receive a letter explaining the Medical Loss Ratio calculation as well. We expect these rebates to be mailed by September 21, 2020.
The Affordable Care Act requires Premera to rebate part of the premiums received if it doesn’t spend at least 80 percent of the premiums it receives on health care services (such as doctors and hospital bills) and activities to improve health care quality (such as efforts to improve patient safety). No more than 20 percent of premiums may be spent on administrative costs (such as salaries, sales, and advertising). This requirement is referred to as the “Medical Loss Ratio” standard or the “80/20 rule.” The 80/20 rule in the Affordable Care Act is intended to ensure that consumers get value for their health care dollars. You can learn more about the 80/20 rule and other provisions of the health reform law.
What the Medical Loss Ratio Rule means to you
The Medical Loss Ratio rule is calculated on a state-by-state basis. In Alaska, Premera doesn’t expect to meet the Medical Loss Ratio standard for 2019. Since it missed the 80% target of premium it receives, Premera must rebate a percentage of the total health insurance premiums paid by the employer and employees in your group health plan.
Need more information?
If you have any questions about the Medical Loss Ratio and your health insurance coverage, contact Premera Blue Cross toll-free at 800-809-9361 (TTY: 711) Monday through Friday, 8 a.m. to 6 p.m. Pacific Time, or visit us at Premera.com.