Independence is pleased to announce that we succeeded in achieving a federal Medical Loss Ratio (MLR) below the required minimums for individual, small, and large group fully‑insured QCC, as well as both large group fully insured Keystone Health Plan East and AmeriHealth PA businesses in Pennsylvania. As a result, Independence will issue affected customers a rebate of a portion of paid premiums during the 2019 reporting year.
Check and notification mailing to begin week of September 14
Beginning the week of September 14, Independence will begin to mail impacted customers their rebate check, a required CMS prescribed notice, and an informative cover letter and FAQ. Their affected subscribers will receive the same required CMS prescribed notice CMS prescribed notice and a customized cover letter and FAQ to help them understand MLR regulations and why their employer or plan administrator is receiving a rebate. However, there are two instances when a rebate will be sent directly to the subscriber:
If the policyholder is a non‑governmental ERISA‑exempt plan and Independence did not receive their written assurance verifying they will distribute their refund according to MLR regulations.
If the policyholder has gone out of business and there is no responsible party we can send the check.
In recent years, Independence has implemented several strategies and programs designed to make health care work better in the communities we serve by working together with providers and hospitals to improve the quality and affordability of the care delivered to our members. Our Facilitated Health Networks (FHN) model is one of these solutions, focused on improving the quality while lowering the total cost of care for our customers and members.
Through FHN, we work collaboratively with doctors and hospitals to deliver value‑based programs that drive improved patient care and health outcomes, while reducing costs.
The 2019 MLR percentage thresholds are determined by market segment:
Individual QCC: We achieved an MLR of 75.8 percent — this is below the required minimum of 80 percent.
Small group QCC (2 – 50): We achieved an MLR of 76 percent — this is below the required minimum of 80 percent.
Large group QCC (51+): We achieved an MLR of 81.2 percent — this is below the required minimum of 85 percent.
Large group KHPE (51+): We achieved an MLR of 79.9 percent — this is below the required minimum of 85 percent.
Large group KHPE AmeriHealth PA (51+): We achieved an MLR of 83.5 percent — this is below the required minimum of 85 percent.
To put this into context, an MLR of 80 percent requires Independence to spend 80 cents of every adjusted premium dollar to pay claims, clinical services, and activities that improve the quality of health care for members. By achieving an MLR below the required minimums, we are ensuring policy holders are getting the most value for their premium dollars, while establishing greater transparency and accountability around administrative costs and realizing efficiencies in our operations.
What is the Medical Loss Ratio?
The Affordable Care Act requires that all health insurers spend a percentage of each premium dollar received towards paying claims, clinical services, and activities that improve health care quality for members. This percentage is known as the minimum Medical Loss Ratio.
If a health insurer does not meet this MLR requirement, the insurer is required by law to issue rebates to employer groups and/or plan subscribers. The rebates being issued by September 30, 2020 are based on premiums Independence received in 2019.
As a reminder, fully insured commercial group health plans (grandfathered and non‑grandfathered plans), Federal Employee Programs, individual health plans, and Medicare plans are subject to MLR rules. Self‑funded commercial group health plans are not subject to MLR rules.
Please reach out to your Total Benefit Solutions Inc, Benefit Specialist at (215)355-2121 We have also created small and large group customer versions of this announcement as well as an informative FAQ document to help you notify your customers of the upcoming mailing. The IBC dedicated MLR customer service team will be prepared to help assist customers and subscribers with any MLR rebate related questions and are available via these helplines:
Independence and AmeriHealth PA customers as well as brokers may call 1‑888‑379‑7435 to speak with a dedicated customer service representative about their rebate check, CMS notice, or letter and FAQ.
Independence subscribers may call 1‑888‑745‑2314 to speak with a dedicated member services representative about the CMS notice, letter and FAQ, or if they qualified to receive a rebate check.
AmeriHealth PA subscribers may call 1‑888‑379‑7435 to speak with a dedicated member services representative about the CMS notice, letter and FAQ, or if they qualified to receive a rebate check.
Impacted parties can also visit cms.gov for more information about MLR requirements.