Blues and MLR in 2019

Bob Herman at Axios is doing a tremendous job of going through the financial statements of the Blues.  This is a recurring project with a lot of insight.  Overall, they are doing very well in 2018:


  • Cumulatively, those Blues insurers made $8.6 billion in profit during the first six months of this year — a 42% increase from the same period in 2017.

  • The ACA’s individual marketplaces remain profitable for nearly every Blues insurer.


Insurers massively overpriced the 2018 individual market.

I am predicting that there will be significant Medical Loss Ratio (MLR) rebates next summer.  The calculations next summer will look at the MLR calculation for 2016-2017-2018.  2016 was a rough year, 2017 was a profitable but not extraordinarily profitable year.  2018 looks to be an extremely profitable year for at least some Blues.  I think this data assembled by Bob supports the idea that there will be large checks being passed out in several states in the fall of 2019.


9 replies
  1. 1
    Ben Vernia says:

    The Medical Loss Ratio provision is one of the best things about the ACA. Yes, insurance companies profited from the law, but those profits are capped.

  2. 2
    biff murphy says:

    Insurers massively overpriced the 2018 individual market… don’t they always?

  3. 3

    @biff murphy: no, they probably priced 2017 about right and massively underpriced the 2014-2015 individual markets

  4. 4
    MomSense says:

    And all the people who dropped insurance because they couldn’t afford the premiums?

  5. 5

    @MomSense: That is going to be the big question — if/as rates on the off-Exchange market drop, will the people who had to run naked this year go back to the ACA markets?

  6. 6
    daveNYC says:

    Isn’t there an opportunity to game the system here? Overcharge for year X, shove the money into commercial paper or something silly safe (or something not so safe, people being stupid and all), and then pocket whatever was made even after cutting checks for the overcharging? Less of an issue in states with competition, but it could be a thing in some places with less of that sort of thing, like Iowa.

  7. 7

    @daveNYC: Yep — and that exact game is why the naked county problem got solved last year.

  8. 8
    ProfDamatu says:

    @MomSense: I’m sure it will be different in places where the gouging wasn’t quite as extreme, but I’ll be surprised to see a big re-uptake in at least some parts of Virginia. Premiums in my area for the second silver, early 40s patient were $870-$1,000 for 2018. They’d have to be cut in half to make a big difference, I would think, and none of the projections for 2019 have suggested anything like that big of a drop. But we shall see!

  9. 9
    Sam Dobermann says:

    The MLR rebates will bee helpful to those who get them & those who who hear about them. What is worrying is that the creatures running the programs will decide the payments should not be made as they will “hurt” those poor little corporations.

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