Medical Loss Ratio Rebates
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This section includes information about income received from Medical Loss Ratio Rebates (MLR).
Policy
Medical Loss Ratio Rebates (MLR) are provided to customers of an insurance company when the insurer fails to spend 80% or 85% of premium dollars on medical care.
MLR’s are countable as a resource when reported.
Countable income is used to determine an income budget. (See Income Budgeting to see how FAA determines the income budget.) FAA needs to know about income that is both countable and not countable to determine whether a budgetary unit’s income is exceeding their expenses. (See Income Eligibility for more information about how FAA uses countable and not countable income.)
Verification
The participant has the primary responsibility for providing verification. (See Participant Responsibilities – Providing Verification for additional policy.)
For NA, income is required to be verified for all of the following before eligibility is determined:
●When reported on a new application, during the interview of a new application, or changes reported before the eligibility determination of a new application.
●For changes reported after an eligibility determination of a new application (e.g., a renewal application, mid approval contact, etc.) and any of the following apply:
The source of the income has changed.
The income is questionable(g) or unclear(g).
The reported income amount has changed by $51 or more.
The previous verification in the case file is more than 59 calendar days(g) old.
For CA, all income is required to be verified before determining eligibility.
Examples of verification that can be used for medical loss ratio rebates include, and are not limited to, any of the following:
●Copy of checks when the gross rebates are listed.
●A statement or collateral contact with the agency or payer providing the income
Legal Authorities
7 CFR 273.9(c)(8)
45 CFR 261.31(b)(1)
last revised 10/27/2025 effective 09/02/2025