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You are here: Home . bulletins . 2011 . cc18

COMMISSIONER'S BULLETIN # B-0018-11

April 20, 2011


To: ALL INSURANCE COMPANIES LICENSED TO WRITE HEALTH COVERAGE IN THE STATE OF TEXAS AND ALL HEALTH MAINTENANCE ORGANIZATIONS (HMOs)


Re: DATA CALL REGARDING MEDICAL LOSS RATIO (MLR) STANDARDS FOR INDIVIDUAL, ASSOCIATION, AND SMALL EMPLOYER MARKETS PURSUANT TO 45 C.F.R. PART 158, SUBPART C

The purpose of the attached data call is to collect data from insurance companies and HMOs that provide health coverage subject to the requirements of the Patient Protection and Affordable Care Act in the individual and small group markets. The data collected will enable the Texas Department of Insurance (Department) to determine whether to request an adjustment to the MLR standard pursuant to the United States Department of Health and Human Services (HHS) regulations located at 45 C.F.R. 158, §§158.301-158.350.
To comply with rebate requirements, §2718 of the Public Health Service Act (codified at 42 U.S.C. §300gg-18) requires health insurance issuers in the individual and small group market to spend at least 80 percent of each premium dollar on reimbursement for clinical services or for activities that improve health care quality. Pursuant to §2718, the HHS Secretary has adopted regulations that permit a state insurance commissioner to request an adjustment to the MLR requirement in regard to individual coverage for up to three years. Such a request must be supported by information about how the insurance market is organized and functions in the state and an assessment of how best to address any risk of destabilization through an adjustment of the MLR standard. The information obtained will enable the Department to evaluate the impact of the MLR and assess whether an adjustment is appropriate.
Although the federal regulation only addresses a potential request for adjustment for the individual market, the Department is interested in any impact the MLR requirement may have on the small group market and has determined that information concerning this market is also relevant to a possible proposal for adjustment. In addition, the Department believes the MLR adjustment should incorporate a broader phase-in on a national level, and thus, is collecting nationwide data through this data call. This MLR Adjustment Data Call is issued subject to the provisions of §38.001 of the Texas Insurance Code and pursuant to 45 C.F.R. 158, §§158.301-158.350.
For the period of January 1, 2010 through December 31, 2010, Texas requests the data as outlined in the attached data call. Insurance companies and HMOs should access the data entry form and instructions from the Department's website at www.tdi.state.tx.us/health/datacall.html and described as "Data for Potential MLR Adjustments".

The deadline for submitting the requested information is May 4, 2011. The Department appreciates the assistance of the insurance and HMO industry.
If you have any questions concerning the information presented in this bulletin, please contact LIFEHEALTH@tdi.state.tx.us.

Mike Geeslin
Commissioner of Insurance



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