Medical Loss Ratio (and I am at loss)

July 21, 2012 5:46 PM

What am I supposed to do with Medical Loss Ratio notice from the insurer?

My health insurance provider is Oxford (United Healthcare) in NY. I just got a notice from them that I am eligible for Medical Loss Ratio (so I presume some kind of refund?) This is the notice

Can anyone tell me what do I do exactly?

Thanks in advance.

P.S. The letter is actually dated 13th July, posted on 18th July, I received on 21st July and I have only couple of days so that they receive the required paperwork by 1st August...B@$***** or any other word from your book..

posted by zaxour to Law & Government (12 answers total)

The notice is required by ACA (aka Obamacare). You can't understand it, which is understandable.

Great.

Your specific notice means you will not get a refund or rebate. You could just throw it away.
posted by caclwmr4 at 5:55 PM on July 21, 2012

Best answer: It looks to me like you don't have to do anything but wait for your check. But don't get too excited -- the last MLR refund I saw on the Internet was for $1.07.
posted by gerryblog at 5:56 PM on July 21, 2012

Or maybe caclwmr4 is right and you don't even get that much. Googling for "met or exceeded" I've seen people using it in exact opposite ways: to describe the condition that leads to a refund and to describe the condition that doesn't. What a mess.
posted by gerryblog at 5:57 PM on July 21, 2012

Best answer: The way I read this, the insurance company must have a MLR of at least 80% (first paragraph). If they don't, they must rebate money to the people carrying the insurance by Aug. 1 (second paragraph). Your insurance company had an MLR of at least 80% so this letter is just an FYI (third paragraph). Nothing for you to do.
posted by Houstonian at 6:06 PM on July 21, 2012 [1 favorite]

Let me add on to my first comment:

I think the notice you received is legally required and what you get when no refund/rebate is required under ACA.

Why it doesn't say exactly that, or something understandable, is a shame.
posted by caclwmr4 at 6:07 PM on July 21, 2012

I'm in HR. All my covered employees got this notice this week. Houstonian is correct.

For future readers, here's the deal. If your insurance company spent less than 80% of the total cost of your coverage on anything other than actual healthcare reimbursements (i.e., limo rides to and from the office for VPs at BCBS, or whatever) they have to give back the difference, in the form of cash reimbursements, partial or full forgiveness of current payments, or lowered cost of future coverage.

That said, your company most likely pays a SIGNIFICANT portion of your healthcare. You will only see that difference. If your company pays, say, 60% of your $200 monthly insurance cost, then you'll get 40% of the refund.

And, guess what? It's taxable, since you most likely paid your portion of your insurance pretax.
posted by pomegranate at 6:33 PM on July 21, 2012 [1 favorite]

Why would the rebate be taxed? The portion the user pays is paid with taxed dollars. The rebate should come with a tax rebate.
posted by caclwmr4 at 7:37 PM on July 21, 2012

I got the same letter (from a different insurer) a few weeks ago. Similar to mine, it simply indicates that your provider paid enough actual health care claims / costs that it is not required to issue any refunds to its members (e.g. you). You don't need to do anything, and you won't be getting anything else, refund or otherwise. It's just a required notification.

pomegranate spelled it out pretty well. caclwmr4, I don't see any reason why a rebate wouldn't be taxed. The portion the user pays is usually paid PRE-tax, as pomegranate said - at least, any medical premium I have ever paid has been pre-tax. If I were to get some of that money back, it should be taxed since it wasn't taxed originally.
posted by SquidLips at 7:57 PM on July 21, 2012

I got more than a $1 back, in fact, I just got a check in the mail for $100! My insurance company, GoldenRule, spent only 72.6% of a total of $125,907,667.00 in premium dollars on health care and activities to improve health care quality, so they had to refund 7.4% of my health insureance premiums back to me. I am happy about it.
posted by pelican at 9:04 PM on July 21, 2012

Response by poster: Thanks folks but to those of you who say that I don't need to do anything, why Oxford wants me to submit documentation then?
posted by zaxour at 4:21 AM on July 22, 2012

Best answer: Oxford does not want you to submit documentation. Take a look again: "No later than August 1, 2012, health insurers must send..." Oxford is the insurer. You are the insured.
posted by Houstonian at 5:32 AM on July 22, 2012 [1 favorite]

Response by poster: Finally, had a word with Oxford's dedicated team for this business. I made a mistake in interpretation that I need to send document (yes, I panicked). This is the notice that is required by new healthcare law and is sent to EVERYONE.
If anyone is to get a refund, will be sent to the one who pays the premium. So for Mrs. Zaxour, her employer gets a refund (if eligible) and for me and DS, we will get it, again, if we are eligible.

Thanks again to everyone who chimed in.
posted by zaxour at 11:13 AM on July 24, 2012