2023 Medical Loss Ratio (MLR) Information

What is the Medical Loss Ratio rebate?

Under the Affordable Care Act (ACA) and state law, insurers are required to spend a certain percentage of premium payments on medical care and healthcare quality, known as the medical loss ratio (MLR). Massachusetts has the highest MLR standard in the country, requiring 88 percent of premiums to be spent on healthcare services for individual and small groups and 85 percent for large groups. It does not apply to self-insured plans.

The MLR rebate is based on a three-year average, with the current year’s rebates representing performance from 2021 - 2023. 

Who will receive rebates for 2023?

Mass General Brigham Health Plan will provide rebates for fully insured plans offered to individuals and small employer groups with 1-50 employees (also called the merged market). For these plans, Mass General Brigham Health Plan's MLR of 86.1% was lower than the required threshold, so we are rebating the difference back to policy holders.

For large employer group plans, Mass General Brigham Health Plan met the minimum threshold, so no rebates are required. 

How will the rebates be provided?

Many of our small employers purchase their insurance directly through Mass General Brigham Health Plan. Small employers and individuals can also purchase their Mass General Brigham Health Plan insurance through intermediaries such as HSA Insurance (HSA) and the Small Business Service Bureau (SBSB) or through the Massachusetts Health Connector. Here is how rebates will be provided:

• Rebate checks will be provided by Mass General Brigham Health Plan to small employer groups who purchase their coverage directly from Mass General Brigham Health Plan.
• Rebate checks will be provided by Mass General Brigham Health Plan to individuals and small employer groups who purchase their coverage through the Massachusetts Health Connector.
• Rebate checks will be provided by the Small Business Service Bureau (SBSB) to individuals and small employer groups who purchase their coverage from SBSB.
• Premium credits will be provided by HSA Insurance (HSA) to individuals and small employers who purchase their coverage through HSA and are active clients. Rebate checks will be provided by HSA to individuals and small employers who purchase their coverage through HSA but terminated their coverage.

Can you share sample notices?

Yes. Here is a sample subscriber notice and a sample small employer group notice.

When will rebates be provided?

Rebates and notices will be sent by September 13, 2024.

Will subscribers be notified if their employers are receiving a rebate?

Yes. Subscribers whose employers are receiving a federal rebate will receive a notice in the mail postmarked by September 13, 2024.

What responsibilities does an employer have if they receive a rebate?

Employers may have fiduciary responsibilities regarding use of this MLR rebate. For general information on the usage of this rebate, you may contact the U.S. Department of Labor (DOL) at (866) 444-3272 or review their guidance on this issue in this document: https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/mlr-insurance-rebate.pdf. Employers also should consult with their benefit or legal advisor about this rebate.

Are employers who are not receiving a rebate getting notified?

No, only employers who will be receiving an MLR rebate for 2023 will be notified.

Could rebates affect taxes for employers and/or individuals?

Yes, rebates may have a tax impact both to employers receiving rebates and to individuals. You may want to consult with your financial and tax advisors regarding the tax impact of the rebate or contact the IRS at (800) 829-1040 or visit https://www.irs.gov/newsroom/medical-loss-ratio-mlr-faqs.