MLR and Broker Commissions
|Course Name:||MLR and Broker Commissions|
|Provider Name:||ComedyCE.com LLC|
|CE Credits:||1 hour|
The ACA’s minimum Medical Loss Ratio (MLR) requirement says that insurance companies have to spend 80 to 85% of the premium dollars they collect on medical care or issue a refund to their policy holders. This requirement kicked in back in 2011 and resulted in an immediate cut to broker commissions in the individual and small group markets. Broker bills aimed at excluding broker commissions from the MLR calculation have failed to make it out of committee, so insurance agents have been working harder for less money for the past six years. Recently, though, there has been another round of commission cuts that doesn’t appear to have anything to do with the MLR — instead, it’s aimed at reducing the risk of adverse selection in the individual market. In this class, we’ll review the MLR requirement, examine its impact on broker commissions, and discuss the possible impact on broker commissions, if any, if this requirement is repealed or modified.