Frequently Asked Questions (FAQ's) for Employees

Overview


5.1 Q: What is the Affordable Care Act?

A. The Affordable Care Act is a shortened name for the Patient Protection and Affordable Care Act (PPACA), a federal statute signed into law in March 2010 and commonly referred to as “health care reform.”

5.2 Q. What does “Medical Loss Ratio” mean?

A. The Medical Loss Ratio, or MLR, is the percentage of the total premium dollars received by a health insurance plan that is spent on health benefits (including claims and health improvement programs) for the plan’s customers in a particular state. For example, if an insurance company sold a plan called an “Individual Medical Red Plan,” and received $1,000,000 in premium payments from all customers with that plan in the previous year in that state, and paid out $800,000 in claims and other health benefits for that plan in the previous year in that state, the MLR would be 80% ($800,000 ÷ $1,000,000). The MLR consists of dollars spent on health benefits. Other costs incurred by the insurance company – administration, employee salaries, marketing, etc. – do not count toward the MLR.

General


5.3 Q. Who is getting a rebate?

A. Eligible policyholders (individuals and group employers) with active coverage in the previous year, by insurance plans subject to the Affordable Care Act, will receive health care reform rebates if the insurance company didn’t meet the minimum Medical Loss Ratio (MLR) for that year. In general, the minimum MLR threshold is 80% for individual and small group customers.

5.4 Q. What types of health insurance does the MLR rule apply to?

A. The MLR rule applies to major medical insurance plans for individuals, families, large groups and small groups, as dictated by health care reform.

5.5 Q. What types of health insurance are not affected by the MLR rebate?

A. The MLR does not apply to short-term (temporary) medical plans, self-funded group plans, supplemental coverage plans or fixed-benefit plans such as Assurant Health AccessSM.

5.6 Q. Do other health insurance companies have to send rebates?

A. All health insurers in the United States that sell plans subject to the Affordable Care Act have to send rebates by September 30 each year if those plans didn’t meet MLR requirements for the previous year.


5.7 Q. Where can I find more information about the MLR?

A. The federal government has set up a website: https://www.healthcare.gov/health-care-law-protections/rate-review/ Diagonal Arrow

5.8 Q. How do I know if our plan is an ERISA plan?

A. Our assumption is that you are an ERISA group and we are following the ERISA guidelines. The only exception is if you are part of a church group.

5.9 Q. My previous employer went out of business. How will I get my rebate?

A. We are required to send all rebates to the employer at the last known address, regardless of the current status of the company. If the rebate is returned to us because the employer went out of the business, we will redistribute it equally to all employees who had medical coverage under the plan in the previous year.

Not Sure If Employer Received Rebate


5.10 Q. I didn't receive a rebate. When will I receive it?

A. Either the minimum MLR threshold for your group plan was satisfied and thus no rebate was issued or your employer has not distributed the rebates yet. The majority of rebates for group major medical coverage were issued to employers for distribution or application to future premium. Please contact your employer to find out if the rebate has been distributed or will otherwise be applied to your premium.

5.11 Q. My former employer may be getting a refund. As a former employee, am I entitled to a portion of the rebate?

A. Contact your former employer directly to find out how any rebate will be used. You can also contact the Department of Labor's Employee Benefits Security Administration at 866.444.3272 or review the technical guidance on this issue on the Department of Labor website at https://www.healthcare.gov/health-care-law-protections/rate-review/ Diagonal Arrow.

Rebate Distribution


5.12 Q. If my employer receives a rebate, are they required to give a portion to me?

A. Some or all of the refund may be an asset of the plan, which must be used for the benefit of the employees covered by the policy. Contact your employer directly to find out how any rebate will be used. You can also contact the Department of Labor's Employee Benefits Security Administration at 866.444.3272 or review the technical guidance on this issue on the Department of Labor website at www.dol.gov/ebsa/newsroom/tr11-04.html Diagonal Arrow.

5.13 Q. What are the rules that the employer must follow in distributing the funds?

A. For most group plans, the employer or group policyholder must distribute part or all of the rebate in one of two ways: either by applying it to the premiums for the upcoming year, or by distributing cash rebates to employees or subscribers that were covered by the plan in the year on which the rebate is based. For additional information, please contact your employer. For general information, you may call the Department of Labor’s Employee Benefits Security Administration at 866.444.EBSA or review the Department’s guidance on this issue on its web site at http://www.dol.gov/ebsa/newsroom/tr11-04.html.

5.14 Q. How is Assurant Health going to make sure employers follow MLR requirements in distributing the rebates?

A. The employer is required under federal law to use the rebate in a specific manner. Assurant Health has no authority to regulate their compliance to federal law. For specifics on how the rebate will be used, please contact your employer. For general information, you may call the Department of Labor’s Employee Benefits Security Administration at 866.444.EBSA or review the Department’s guidance on this issue on its web site at http://www.dol.gov/ebsa/newsroom/tr11-04.html Diagonal Arrow.

5.15 Q. What are my rights regarding the rebate from my employer?

A. For general information about your rights regarding the rebate, you may contact the Department of Labor’s Employee Benefits Security Administration at 866.444.EBSA or review the Department’s guidance on this issue on its web site at http://www.dol.gov/ebsa/newsroom/tr11-04.html Diagonal Arrow.

5.16 Q. If I quit my job or was fired, is my former employer required to give me any portion of the rebate?

A. For most companies, per federal regulation, the employer must distribute the rebate in one of two ways, at their option: Reducing premium for the upcoming year, in which case subscribers who were covered by the health insurance on which the rebate is based but are no longer employed there would not benefit; or providing a cash rebate to subscribers who were covered by the health insurance on which the rebate is based. For specifics on how the rebate will be used, please contact your former employer. For general information, you may call the Department of Labor’s Employee Benefits Security Administration at 866.444.EBSA or review the Department’s guidance on this issue on its web site at http://www.dol.gov/ebsa/newsroom/tr11-04.html Diagonal Arrow.

5.17 Q. Why did the check go to my employer?

A. In general, health care reform regulations require that the check go to your employer.

The Following Only Apply To Church Employees


5.18 Q. My rebate was very small. Why did you send rebates for small dollar amounts?

A. Per health care reform, any rebates of $5 or more for individuals and $20 or more for employers are being sent to the customers.

5.19 Q. I am no longer insured by your company. Why did you send me this rebate?

A. The rebates are based on the previous year's coverage. Anyone who had coverage any time during the previous year may qualify for a rebate, regardless of current customer status.


5.20 Q. Will I receive a rebate next year?

A. At this time, we aren’t able to determine if you will receive a rebate next year or not. Future rebates are based on claims paid and premium received for each year in a particular state and won’t be known until July of the following year.

5.21 Q. I received someone else’s check. What should I do?

A. All inquiries must be submitted in writing to PO Box 624, Milwaukee, WI 53201-0624.

5.22 Q. My check was lost, stolen or thrown away. How can I get a replacement?

A. All inquiries must be submitted in writing to PO Box 624, Milwaukee, WI 53201-0624.

5.23 Q. Don’t you owe me interest on this?

A. The U.S. Department of Health and Human Services (HHS) does not require that insurers pay interest on rebates.

Taxes


5.24 Q. Do rebate recipients have to pay taxes on the rebate?


A. Generally, it depends on if premium payments were made pre-tax or after-tax. The IRS has a web page with details: http://www.irs.gov/newsroom/article/0,,id=256167,00.html Diagonal Arrow

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