What is Medical Loss Ratio?

Medical Loss Ratio (MLR) is the percentage of premium dollars that health insurance companies must spend on medical care and quality improvement activities rather than administrative costs, marketing, and profits. Under the Affordable Care Act, insurers must spend at least 80% of premiums on medical care for individual and small group plans, and 85% for large group plans. If insurers fail to meet these thresholds, they must provide rebates to policyholders.

Why medical loss ratio matters

• Ensures value: Guarantees most of your premium dollars go toward actual healthcare services
• Generates rebates: You may receive money back if your insurer spends too much on administration
• Promotes efficiency: Encourages insurers to minimize overhead and focus on healthcare delivery

How Solace can help

A Solace advocate can help you understand MLR requirements, determine if you're eligible for rebates, and ensure you receive any payments due. Advocates can also explain how MLR affects your premium costs and coverage options.