The area's three major health plans in 2012 all easily met federal guidelines for how much of their revenues must be spent on medical benefits for their members, the insurers said this week.
Health plans are required under a provision in the federal Affordable Care Act to provide an accounting of how they spend their premium dollars, known as their medical loss ratio, or MLR, data. The most recent filings were due to the federal government on Saturday, and there also are state regulations.
HealthNow New York, the Buffalo-based parent company of BlueCross BlueShield of Western New York; Independent Health Association; and Rochester's Excellus, which operates in the Buffalo area as Univera Healthcare, all met the minimum federal standard of spending on medical care and health services last year.
Overall, Excellus reported that it paid out $3.8 billion in medical benefits for its customers, out of $4.1 billion in after-tax premium revenues collected, or about $330 million more than federal and state requirements.
The federal reporting regulations are broken down into three areas: small group, large group and individual plans.
In the small group commercial pool, for example, which includes businesses with up to 50 employees, the federal standard requires spending at least 82 percent of premiums on medical expenses and claims. Locally, HealthNow spent 98.4 percent of small-group premiums on medical expenses, while Excellus spent 92.5 percent, according to those companies.
For large group coverage, the federal minimum is 85 percent. HealthNow reported spending 91.6 percent of those premiums on medical expenses and Excellus reported spending 92.1 percent.
For those with individual, direct-pay plans, where the federal minimum is 82 percent, HealthNow reported spending 122.5 percent of those premiums on medical expenses and Excellus reported spending 94.9 percent.
Independent Health did not report specific numbers but the health plan said in a statement that the insurer exceeded the federal minimum standards in the three categories.
"Our MLR results demonstrate the company’s efforts to operate as efficiently as possible and that our products are priced appropriately," the statement reads.
Insurers, including some elsewhere in the country, that don't meet the minimum standards are required to issue rebates.
-- Stephen T. Watson