June 21 -- The Centers for Medicare & Medicaid Services (CMS), Health and Human Services (HHS) invites comments by August 21, 2023 regarding the renewal of CMS–10418: Medical Loss Ratio Annual Reports, MLR Notices, and Recordkeeping Requirements.
Under section 2718 of the Affordable Care Act and implementing regulation at 45 CFR part 158, a health insurance issuer (issuer) offering group or individual health insurance coverage must submit a report to the Secretary concerning the amount the issuer spends each year on claims, quality improvement expenses, non-claims costs, Federal and State taxes and licensing and regulatory fees, the amount of earned premium, and beginning with the 2014 reporting year, the amounts related to the transitional reinsurance and risk adjustment programs established under sections 1341 and 1343, respectively, of the Affordable Care Act. An issuer must provide an annual rebate if the amount it spends on certain costs compared to its premium revenue (excluding Federal and States taxes and licensing and regulatory fees) does not meet a certain ratio, referred to as the medical loss ratio (MLR).
Each issuer is required to submit annually MLR data, including information about any rebates it must provide, on a form prescribed by CMS, for each State in which the issuer conducts business. Each issuer is also required to provide a rebate notice to each policyholder that is owed a rebate and each subscriber of policyholders that are owed a rebate for any given MLR reporting year. Additionally, each issuer is required to maintain for a period of seven years all documents, records and other evidence that support the data included in each issuer's annual report to the Secretary.
The following information collections are included in this request:
Annual Report. Under 45 CFR §158.110, issuers are required to submit an annual data report to the Secretary by July 31 of the year following the end of an MLR reporting year. Sections 158.120 through 158.260 set out the data requirements for this report. In addition, under 45 CFR §158.260, each issuer must also submit a report to the Secretary concerning the rebates provided to and on behalf of enrollees. Section 158.260 requires that this report be submitted with the annual report under §158.110.
Notices. As specified in 45 CFR §158.240(a), an issuer must provide rebates to enrollees and policyholders on behalf of enrollees when the issuer’s MLR does not meet the applicable minimum MLR standard. Section 158.250 requires an issuer to provide information in the form of a rebate notice to policyholders who are owed a rebate and subscribers whose policyholders are owed a rebate. As also provided in 45 CFR §158.250, CMS has developed a standard form for the rebate notice that each issuer must send by September 30 of the year following the reporting year for which policyholders are entitled to a rebate. The standard rebate notices were approved by OMB Control Number 0938-1164. This information collection makes minor revisions to these notices to improve readability and update the references to dates, website addresses, and annual report line numbers.
Recordkeeping. The MLR regulations contain two recordkeeping requirements. Section 158.502 requires an issuer to maintain all documents and other evidence necessary to enable CMS to verify that the data submitted by the issuer is in compliance with 45 CFR Part 158, including all documents, records, and other evidence used to calculate the MLR and any rebates, and that any rebates owing in accordance with 45 CFR Part 158 are provided. Section 158.501 requires an issuer to preserve and maintain all such documents, records, and other evidence for the MLR reporting year as well as six prior years unless a longer period is required under §158.501.
The data collection of annual reports provided by an issuer for each State’s individual, small group, and large group markets will be used by CMS to ensure that consumers are receiving value for their premium dollar by calculating each issuer’s MLR and any rebate payments due for the respective MLR reporting year, as well as verifying the provision of any rebates and rebate notices. As required by section 2718(a) of the PHS Act, CMS intends to publish issuers’ annual reports on its internet website.
Medical Loss Ratio Search Tool:
https://www.cms.gov/cciio/mlr
Draft data collection instruments and technical documentation:
https://www.cms.gov/regulations-and-guidancelegislationpaperworkreductionactof1995pra-listing/cms-10418
FRN:
https://www.federalregister.gov/d/2023-13103