Question: Underwriting Costs & The New MLR Rules.

AllenChicago

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Our agency is noticing a rather sizable decline in the number of Attending Physician Statements and Physicals being ordered by our primary health insurance company (IHC/IAC) over the past 30 days. Underwriting approval has always been stellar, but it's now coming faster than ever...

QUESTION:
Is the cost of underwriting an applicant subject to the 15%/20% Administrative-Cost side of the MLR calculation for health insurers? I'm getting the impression from the way underwriting is being streamlined that they are, but I would like to know what my esteemed forum colleagues think.

Thanks in advance for any knowledge-based feedback. Success and happiness to each of you in 2011! :1biggrin:

-Allen in Chicagoland
 
Thank-you for the confirmation! This is one aspect of the MLR I have no problem with...LOL.
 
Underwriters are getting scarce so the ones that are left are working in a hurry to get the app through. Once guaranteed issue comes along who needs em except for check for fraud?
 
Anthem has been cranking out apps without APS left and right. Other companies still seem to be ordering plenty of them though.
 
Once guaranteed issue comes along who needs em except for check for fraud?

It is my understanding that Only the State Exchanges will provide guaranteed issue, at a set price determined by age. But that price will be very high...like we see in Massachuttes now. Premium subsidies will be available for people who buy on the exchange, but the premium will be so costly, that the relatively healthy folks will be better off on the open market. Certainly those who earn $50K or more will be better off.
 
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