DOI Bruce Rauner Governor Anne Melissa Dowling, Acting Director

Medical Loss Ratios

The Medical Loss Ratio (MLR) provision of the Affordable Care Act (ACA), released on November 22, 2010 works in conjunction with the Premium Rate Review Program to increase the value that consumers receive for their health care premium dollars.

Medical Loss Ratio (MLR) refers to the portion of insurance premiums an insurer spends on health care and expenses to improve health care quality. The Affordable Care Act requires that a minimum of 80% (in the small group market) and 85% (in the large group market) of each premium dollar is spent on health care services and health care quality improvement and not on company overhead and administrative costs. The MLR regulations are codified as 45 CFR Part 158.

Insurers failing to meet the applicable MLR standard must pay rebates to consumers beginning in August 2012.

Illinois Guidance

Federal Regulations, Guidance and Reports

NAIC Guidance