FAQ's for Individuals - I received a rebate
1.0 Q: If my plan has terminated, why am I receiving a rebate check?
A. The rebates are based on your previous year coverage. Eligible policyholders with active coverage in the previous year will receive rebates if the insurance company didn’t meet the minimum Medical Loss Ratio (MLR) for that year.
1.1 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.”
1.2 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.
1.3 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.
1.4 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.
1.5 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.
1.6 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.
1.7 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/
1.8 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 August of the following year.
1.9 Q. I received someone else’s check. What should I do?
A. Please contact us at 800.392.1816.
1.10 Q. My check was lost, stolen or thrown away. How can I get a replacement?
A. Please contact us at 800.392.1816.
1.11 Q. How can I find out exactly how my rebate was calculated?
A. Your rebate was calculated based on your medical premiums paid to Assurant Health for health insurance applicable to the period of coverage from January 1 through December 31 of the previous year.
Any premiums due for non-medical benefits, like Life, Dental or Accident coverage, were not included in this calculation.
The calculation from Health and Human Services adjusts your medical premium to subtract any Federal or State taxes, assessments, and licensing or regulatory fees we were required to pay.
This amount is multiplied by the percentage indicated in the letter that accompanied your rebate check.
An additional adjustment is required for the overall state rebate amount.
These calculations comply with Federal guidelines and were submitted to Health and Human Services for review.
1.12 Q. How does an individual's claims activity affect individual rebates?
A. Rebates are not based on the personal claims activity of any individual. Rebates are based on overall health care claims activity that occurred in the previous year and if applicable in additional previous years for everybody in the state with the type of insurance policy to which the rebate applies.
1.13 Q. Why did my state apply for a lower ratio? This impacts my rebate.
A. Some states were concerned that meeting the 80% Medical Loss Ratio standard would destabilize the individual health insurance market and provide fewer choices for their residents. More information can be found here: https://www.healthcare.gov/health-care-law-protections/rate-review/
1.14 Q. Does the government calculate Assurant Health’s MLR, or is it calculated by Assurant Health?
A. Assurant Health calculates the rebate based on claims paid and premium received. We report this information to the U.S. Department of Health and Human Services (HHS) based on the guidelines they provide.
1.15 Q. Whether or not I receive a rebate, and how much that rebate is, is dependent on the group of policies that my policy is a part of. How is that group determined?
A. Parameters include: Whether your policy is individual medical, small group or large group coverage. The state in which the policy is issued. The legal entity that underwrites and issues the policy — Assurant Health is the brand name for insurance underwritten and issued by Time Insurance Company, John Alden Life Insurance Company and Union Security Insurance Company.
1.16 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.
1.17 Q. I moved to another state, why was my rebate based on my old address?
A. Per health care reform, rebates are based on the state in which the policy is issued, not where the policyholder lives or works.
1.18 Q. I had two policies with you last year. Why did I only receive one rebate?
A. Whether or not a rebate is sent for a given policy is dependent on several parameters, including:
Whether your policy is individual medical, small group or large group coverage
The state in which the policy is issued
The legal entity that underwrites and issues the policy — Assurant Health is the brand name for insurance underwritten and issued by Time Insurance Company, John Alden Life Insurance Company and Union Security Insurance Company
Another possibility is the policy for which you did not receive a rebate satisfied the minimum MLR requirements.
1.19 Q. Why did I receive multiple checks?
A. You received multiple checks if you had multiple active policies subject to the MLR in the previous year, and the minimum MLR threshold was not satisfied with respect to more than one of those policies.
1.20 Q. Who are you sending the rebate to?
A. Rebates are being sent to the primary insured on the policy, unless the primary is less than 18 years of age. If the primary insured is less than 18 years of age, the rebate is being sent to the payor listed on the policy.
1.21 Q. I’m the payor for the policy. Why wasn’t the rebate sent to me?
A. The policy is owned by the primary insured. Once premiums are paid, they become a part of the policy, and any rebate or refund is directed to the policy owner if 18 years of age or older. If the primary insured is under 18 years of age, the refund will go to the payor.
1.22 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.
1.23 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 (if the MLR minimum threshold was not satisfied), regardless of current customer status.
1.24 Q. Why did I receive a separate rebate from my state? How is this different from the rebate you sent me?
A. The MLR rebate dictated by health care reform is a federal law. However, some states also have similar rebate provisions that are calculated independently from the federal rebate.
1.25 Q. Why didn't you just credit this to my premium?
A. We surveyed our customers and found that most would prefer a refund instead of a credit toward their premium. In addition, this is your money and we wanted to put this in your hands and give you the option of using it as you choose.
1.26 Q. How did the premium that I paid impact the rebate amount?
A. The premium is only one piece of the rebate calculation; there are many other factors. This rebate amount is based on premium for coverage for the period of January 1 through December 1, of the previous year.
MLR Premium includes premiums due for the following:
Any fees, such as Administration Fees
Refunds for premium corrections for medical coverage in the previous year paid or credited prior to March 31 of the current year.
Does not include federal MLR rebates or state rebates received in the previous year or premium due for:
Supplemental Coverage such as Dental, Accident, Critical Illness, etc.
Short Term Medical
Fixed Benefit Health Plans
Once Assurant Health has calculated your premium due, we make a final deduction to account for State and Federal taxes. (Deductions vary by state.) The final amount is your MLR Premium. This calculation is performed in accordance with health care reform MLR requirements.
1.27 Q. Do rebate recipients have to pay taxes on the rebate?
A. The IRS has a web page that may assist you in answering this question: http://www.irs.gov/newsroom/article/0,,id=256167,00.html
. However, we recommend that you consult with your tax advisor for purposes of making this determination.