Aetna: Medical Loss Ratio (MLR)

The Minimum Medical Loss Ratio (MLR) provision of the Affordable Care Act sets minimum percentages that health plans must spend on medical costs and quality improvement activities. Insurers file reports with the federal government detailing where they met the minimum, where they didn’t, and how much they will pay their insured customers in rebates. Aetna announced that this year they will pay out $15 million for the 2014 experience year.  Aetna stated that “This total is significantly lower than last year and is a clear indication that we met our goal—to price our business so that we deliver the greatest value to our customers, remain competitive in the market and grow our business.”

In this fourth year of MLR reporting, Aetna’s rebates represent 0.06 percent of the premiums we collected stating “The rebates we are paying are modest, and most policyholders/employers won’t receive a rebate at all.”

What happens next?

By September 30, Aetna will send notices to all subscribers and policyholders/employers of plans due a rebate for Aetna, Innovation Health and Coventry Health Plans. In most cases, for group plans, policyholders (plan sponsors/employers) will receive the plan’s rebate. In certain circumstances, the government has directed that the rebate go directly to subscribers of the group policyholders (e.g., terminated plans where we cannot locate the policyholders). The amount of the check will depend on the total premiums paid by the customer in 2014.


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The information provided is for informational purposes only and does not constitute legal advice. The information above contains only a summary of the applicable legal provisions and does not purport to cover every aspect of any particular law, regulation or requirement. Depending on the specific facts of any situation, there may be additional or different requirements. This is to be used only as a guide and not as a definitive description of your compliance obligations.