Theargument then goes that the only way carriers can increase theirlevel of profit is to "allow" (or some say "intentionally drive")total costs/premiums to increase. (Photo: Shutterstock)
I can't even begin to count the number of times I've read onLinkedIn or heard in live presentations that the BUCAH carriers areactually incentivized to have rates/costs go up.
The argument is based on the ACA's MLR provision that requiresthat carriers spend at least 80 percent (individual and smallgroup) or 85 percent (large group) of collected premiums on claims.That means that the carriers are limited to between 15 percent and20 percent of collected premiums to cover their administrationcosts, including their profit.
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