TX Strikes Out on MLR Waiver Request

Margaret Dick Tocknell, for HealthLeaders Media , January 30, 2012

The CMS letter announcing the decision noted that Texas has a state-operated high-risk pool that provides guaranteed coverage to Texas residents with qualifying medical conditions. "We conclude that the remaining insurers in Texas' robust individual market and the Pool would be able to offer comparable products to the enrollees of any withdrawing issuer," says the letter.

A statement on the TDI web site says, "In denying Texas' application, HHS stated that it took into account each carrier's MLR and profitability…and asserted that few issuers are reasonably likely to exit the individual market in Texas. The department's application clearly showed otherwise.

Of the 34 Texas carriers subject to the law, 23 will pay rebates based on 2010 data; at the 80% MLR threshold, these rebates will absorb the net underwriting profit for the entire individual market.

"HHS' decision does not allow sufficient time for carriers to adjust their operating models, nor does it contemplate the effects on small and mid-level carriers that lack the resources and administrative economies of scale to compete in the individual market under PPACA. A reasonable, responsible phased-in approach would still have afforded rebates to Texas consumers without risking disruption, dislocation and withdrawal of carriers in the individual market. The department will continue to work to ensure the availability of high-quality, high-value health insurance to this important underserved segment of the market."

Texas officials now have 10 days to appeal the CMS decision. Officials at the Texas DOI did not reply to questions regarding any appeal prospects.

1 | 2 | 3 | 4

Comments are moderated. Please be patient.

1 comments on "TX Strikes Out on MLR Waiver Request"

Robert Luedecke, MD (2/3/2012 at 10:32 AM)
It is no secret that Governor Perry is opposed to any idea introduced by Democrats. The Texas Medical Association has been trying for many years to get exactly this sort of transparency in the insurance industry. This legislation is a major good for all the people of Texas in giving them more information to help the free enterprise system work more efficiently and should be implemented without delay.




FREE e-Newsletters Join the Council Subscribe to HL magazine


100 Winners Circle Suite 300
Brentwood, TN 37027


About | Advertise | Terms of Use | Privacy Policy | Reprints/Permissions | Contact
© HealthLeaders Media 2016 a division of BLR All rights reserved.