BCBSM and BCN Provide Rebates to Small Business Customers

by bcbsm

| 3 min read

Several months after Blue Cross Blue Shield of Michigan announced that we are reducing insurance rates for many of our small employer customers in Michigan, another dose of good news is on the way. Because of lower-than-expected medical costs in 2014, Blue Cross Blue Shield of Michigan and Blue Care Network are able to refund many of our small employers (with fewer than 50 employees) a small percentage of their 2014 premiums. A letter (with a check enclosed) will be mailed to more than 24,000 small employers by September 30 to notify them of a rebate of just under 2 percent of their 2014 premiums paid for BCN and one-tenth of 1 percent of premiums paid for Blue Cross.

Why are Blue Cross and Blue Care Network providing rebates?

Plainly and simply, it’s the law. Months in advance, our actuaries predict the expected use and cost of medical and pharmacy services. Benefit costs are very volatile and should benefit expenses not account for at least 80 percent of the total premium to cover our members’ health costs, we must pay the employer back a percentage under the federal Affordable Care Act law. Under the ACA, 80 percent of a premium must go to health care claims for small group and individual coverage, and 85 percent for large group employer premiums. By this calculation, many of our small group customers qualified for a rebate this year.

What can employers do with the money?

Employers are responsible for using the rebates according to federal law. This may involve applying them to lower future premiums or providing covered employees a portion of the rebate amount.

What factors led to these rebates?

Many factors affect the use and cost of medical services. For example, our unique and comprehensive partnerships with doctors and hospitals – including our Patient-Centered Medical Home and Value Partnerships quality improvement programs – are helping to manage medical trends downward by eliminating unnecessary costs and promoting better health for our members. Innovative products and programs that encourage living healthier also play a role. Our priority is always to provide high-quality coverage that encourages better health with products and programs that will help control health care costs.

We are reducing small employer premiums starting now

There’s more good news for small employers. Blue Cross and Blue Care Network have factored the trend showing lower medical costs trend into premium rates for groups that are renewing their coverage. It’s good news when lower than expected costs allow us to pass along, on average, a 3.3 percent lower premium for Blue Cross small group customers and a less than 1 percent premium increase for BCN small groups that are renewing their coverage in third and fourth quarter 2015. Those average numbers remain favorable for small groups renewing in early 2016. Photo Credit: Scott Lewis

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Blues Perspectives

Oct 25, 2017 at 2:04am

Hi Justin, We’d be happy to provide clarification for any questions you have. Please provide us with your new policy information here: http://miblues.co/1Bb6oI4, and we will reach out directly. Thank you, Taylar


Oct 24, 2017 at 6:58pm

What if you no longer work for the small business and they are not giving you any information on the rebate.

Brenda Sidney

Sep 15, 2017 at 7:08am

Why not send each employee a separate rebate check instead of sending it to employer when employee's the one who spend out of their hard earned money to pay it every month

Brenda Sidney

Sep 15, 2017 at 7:05am

Does the employer pay or match biweekly payments that there employee's pay for there insurance the reason why they don't give there employee's any of the rebate check?

MI Blues Perspectives is sponsored by Blue Cross Blue Shield of Michigan, a nonprofit, independent licensee of the Blue Cross Blue Shield Association