Broker Message From EmblemHealth

JUNE 27, 2013

Notifying Policyholders About MLR Requirements and Rebates

The federal Affordable Care Act's Medical Loss Ratio (MLR) provision requires health insurers to spend most of the premiums they receive on medical care and activities that improve the quality of care. If the insurer's costs are lower than the minimum required to be spent on these services, the insurer will issue policyholders a rebate. This rebate will be based in part on whether the recipient is classified as a small or large group (as defined by the federal government) or as an individual (including sole proprietors). In addition, the MLR rebate issued depends upon the policyholder's specific plan.

On or about June 26, 2013, we will be mailing letters to all EmblemHealth individual and group policyholders who will be receiving a rebate from their plan. The links below reflect samples of our communications to policyholders.

Below are answers to questions you or your clients may have about the MLR requirements and eligibility for a rebate:

Q: Who is affected by the MLR requirements?
A: : Only groups and subscribers who are receiving a rebate will be mailed a letter. This year, only GHI HMO large groups and subscribers (including FEHBP, NYSHIP and City of New York) and GHI HMO large group COBRA subscribers will receive a rebate.

Q: Is a group that no longer has coverage still eligible for the rebate?
A: Yes. If a group paid premiums during the 2012 MLR reporting year and EmblemHealth did not spend the required minimum threshold on health care services, the group may qualify for a rebate.

Q: What factors determine whether a policyholder is eligible for a rebate?
A: For small groups and individuals in New York State the health insurer must spend at least 82 percent of the premiums it receives on health care services, including doctor bills, hospital bills, activities to improve health care quality and patient safety; only 18 percent can be spent on administrative costs. For large groups the health insurer must spend at least 85 percent of the premiums received on health care services; only 15 percent can be spent on administrative costs. For more information on MLR requirement, please visit:

Q: Is a group required to have a specific number of employees to be eligible for the rebate?
A: Yes. The rebate calculation takes into consideration premiums spent on health care and the group's classification as small (2-50) or large (51+).

Q: Are self-funded plans subject to MLR reporting and rebate requirements?
A: No. A self-funded plan, also known as a self-insured plan, is not a health insurance issuer. As a result, it is not subject to the MLR requirements.

We are pleased that the number of rebates is minimal and our competitive pricing appropriately reflects medical costs in the region.

If you have any questions, please contact your EmblemHealth representative.


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Group Health Incorporated (GHI), GHI HMO Select, Inc. (GHI HMO), HIP Health Plan of New York (HIP), HIP Insurance Company of New York and EmblemHealth Services Company, LLC are EmblemHealth companies. EmblemHealth Services Company, LLC provides administrative services to the EmblemHealth companies.

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