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Medical Loss Ratio

Starting with contract year 2014, Medicare Advantage (MA) organizations, Part D prescription drug plan sponsors, and cost plans are required to submit a medical loss ratio (MLR) report to CMS on an annual basis.  The purpose of this page is to share information relating to the MLR reporting process.

Overview

The Affordable Care Act of 2010 amended section 1857(e) of the Social Security Act ("the Act") to add new MLR requirements for MA plans.  A plan’s MLR is reported at the contract level and is expressed as a percentage, generally representing the percentage of revenue used for patient care, rather than for such other items as administrative expenses or profit.  Because section 1860D-12(b)(3)(D) of the Act incorporates by reference the requirements of section 1857(e), the new MLR requirements also apply to Medicare Part D.  The MLR requirements for MA organizations and Part D sponsors have been codified in the regulations at 42 CFR Part 422, Subpart X, and 42 CFR Part 423, Subpart X.

For contracts beginning in 2014 or later, MA organizations, Part D sponsors, and cost plans are required to report their MLRs and are subject to financial and other penalties for failure to meet the statutory requirement that they have an MLR of at least 85 percent (see §§422.2410 and 423.2410).  The statute imposes several levels of sanctions for failure to meet the minimum MLR requirement, including remittance of funds to CMS, a prohibition on enrolling new members, and ultimately contract termination.  The minimum MLR requirement creates incentives for MA organizations and Part D sponsors to reduce administrative costs and helps to ensure that taxpayers and enrolled beneficiaries receive value from Medicare health plans.

CY 2017 MLR

CY 2017 MLR Report Workbook and Instructions

Memoranda and other guidance:

CY 2016 MLR

CY 2016 MLR Report Workbook and Instructions

Memoranda and other guidance:

CY 2015 MLR

CY 2015 MLR Report Workbook and Instructions

Memoranda and other guidance:

CY 2014 MLR

CY 2014 MLR Report Workbook and Instructions

Memoranda and other guidance:

Part C and Part D MLR data:

  • Public Use File for CY 2014 - This release contains data submitted by MAOs, Part D sponsors, and cost plans in their CY 2014 MLR reports.

MLR Reporting Q&A

CMS responds to questions submitted to the "MLR Report" mailbox.  The following document is a collection of our responses to questions we have received:  

CMS Guidance Regarding MLR Reporting Requirements: Q&A (last updated: 10/19/2015)

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