Medical Loss Ratio

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The Affordable Care Act requires health insurers in the individual and small group markets to spend at least 80 percent of the premiums they receive on health care services and activities to improve health care quality (in the large group market, this amount is 85 percent). This is referred to as the medical loss ratio (MLR) rule or the 80/20 rule. If a health insurer does not spend at least 80 percent of the premiums it receives on health care services and activities to improve health care quality, the insurer must rebate the difference.

Based on the information that we submitted to the Kansas Insurance Department and the U.S. Department of Health and Human Services, the Blue Cross and Blue Shield of Kansas MLR ratios by line of business for 2019 were:

Individual business       88.3 percent
Small group business   91.6 percent
Large group business   91.4 percent

The employees of Blue Cross and Blue Shield of Kansas are proud to be good stewards of our members’ premium dollars and we work hard to keep our administrative costs as low as possible. This effort means that we have, for many, many years, operated our business well within the MLR guidelines established by the Affordable Care Act.