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Medical Loss Ratio

Today, many insurance companies spend a substantial portion of consumers’ premium dollars on administrative costs and profits, including executive salaries, overhead, and marketing.  Under the Affordable Care Act, consumers will receive more value for their premium dollar.  New regulations require health insurers to spend 80 to 85 percent of consumers’ premiums on direct care for patients and efforts to improve care quality, rather than on administrative costs, starting in 2011.  If they don’t, the insurance companies will be required to provide a rebate to their customers starting in 2012.

The Affordable Care Act allows the Secretary to adjust the medical loss ratio (MLR) standard for a State if it is determined that meeting the 80 percent medical loss ratio standard may destabilize the individual market.  In order to qualify for this adjustment, a State must demonstrate that requiring insurers in its individual market to meet the 80 percent MLR has a likelihood of destabilizing the individual market and could result in fewer choices for consumers.  This HHS Bulletin describes the method and format States must use in order to apply for an MLR adjustment.  Applications must be submitted by email to

A State’s request for an adjustment to the MLR standard is a public document. The Secretary invites public comment regarding a State’s request.  However, public comments must be submitted within 10 calendar days of HHS posting a State's complete request online.  The public comment period is designed to give all interested parties full opportunity to present relevant information to the Secretary, which will be considered in making a timely determination on whether an adjustment to the statutory MLR standard is justified for the State applicant’s individual market. 

This page contains State applications for an adjustment to the MLR standard for the individual market.  When an application is deemed complete, the webpage will be updated to reflect the deadline for public comment on the State’s application. All public comments must be submitted electronically by midnight on the 10th calendar day after the posting of a complete State request.

To submit a comment regarding a State's adjustment application, please email  Please include the relevant State applicant in the email subject line.

State Requests for MLR Adjustment:

  • Maine (application complete, public comments due February 5, 2011)
  • New Hampshire (undergoing review for completeness, public comments due TBD)
  • Nevada (undergoing review for completeness, public comments due TBD)
  • Kentucky (undergoing review for completeness, public comments due TBD)