The Indiana Department of Insurance say nearly 10 percent of the state’s health insurance carriers have withdrawn from Indiana because of a requirement in the Affordable Care Act. That requirement is the medical loss ratio (MLR) for individual medical health insurance. According to Affordable Care Act, insurance companies must spend 80 percent of premiums on customers’ claims. According to Insurance Journal, the Indiana Department of Insurance said many of the state’s health insurance carriers have left Indiana because of the MLR requirement.
Indiana Insurance Commissioner Stephen W. Robertson has announced he is seeking a waiver on behalf of Indiana from that part of the law. Indiana is requesting permanent relief from the 80 percent MLR requirement for consumer driven health plans (CDHPs). CDHPs have higher deductibles than traditional health insurance, but consumers enjoy lower monthly premiums in return.
The Commissioner proposed an alternative approach to implement MLR. In 2011, 2012, 2013 and 2014 MLR will be phased-in at 65 percent, 68.75 percent, 72.5 percent, 76.25 percent and 80 percent, respectively. The waiver is requested through Jan. 1, 2015, because of the carriers’ practices of maintaining the same premium — typically one year — for an individual consumer. Read more.
Meanwhile, Kentucky Insurance Commissioner Sharon Clark has also requested permission to delay the implementation of the medical loss ratio requirement in her state because there are too few insurance carriers in Kentucky. According to Kentucky.com’s Daily Business Report, Clark said too few companies offering policies in the state would disrupt the market and increase insurance costs for customers. “My main motivation was to give them an adjustment period so we would not lose more companies,” Clark said. “One of the best things that we can do is provide choice. Read More