Texas: Hold on to your ten gallon hats, folks: $92 million in MLR rebate payments isn't even half of the story.

MLR rebate payments for 2018 are being sent out to enrollees even as I type this. The data for 2018 MLR rebates won't be officially posted for another month or so, but I've managed to acquire it early, and after a lot of number-crunching the data, I've recompiled it into an easy-to-read format.

But that's not all! In addition to the actual 2018 MLR rebates, I've gone one step further and have taken an early crack at trying to figure out what 2019 MLR rebates might end up looking like next year (for the Individual Market only). In order to do this, I had to make several very large assumptions:

  • First, I assumed total enrollment for each carrier remains exactly the same year over year.
  • Second, I assume the average 2019 rate changes I recorded for each carrier last fall are accurate.
  • Third, I assume 2019 is seeing a 5% medical trendline on average...that is, that total 2019 claims per enrollee will be 5% higher than 2018's.

All three of these are very questionable, of course, but they at least provide a baseline.

All that being said, here's what the payments for 2018 going out this month look like in Texas:

Whew! Nearly $92 million in MLR rebate payments are being paid out by Texas carriers this month, with over 81% of it coming from a single company: Health Care Service Corp, aka Blue Cross Blue Shield of Texas. Furthermore, all of BCBS's $75 million is going to Individual Market enrollees specifically, along with another $5 million from several other carriers, for a grand total of over $80 million going out to 592,000 Individual Market members...averaging around $136 apiece.

HERE'S WHERE IT GETS REALLY MIND-BLOWING, THOUGH: Check HCSC's MLR percentages below: 93.2% in 2016; just 72.3% in 2017; and a mere 66.9% in 2018. With 2016 dropping off and with HCSC only reducing rates 6.5% this year, it's possible that they could end up having to pay out as much as $216 million all by themselves. Combined with other carriers, Texas MLR rebates alone could conceivably break a quarter of a billion dollars next year. 

AGAIN: There's absolutely no guarantee that things will play out this way. It's possible that none of these carriers will make MLR payments next year, or only some of them will, or the amounts will be smaller. These 2019 projections are pure speculation on my part based on a number of big assumptions.