Sizing Up Exchange Market Competition
The Medical Loss Ratio provision assures that insurers cannot profit excessively relative to the premiums they charge, but it does not guarantee that insurers will push to get the lowest costs and charge to lowest premiums.
Kaiser Family Foundation analysis of insurance company rate filings to state regulators and data released by the U.S. Department of Health & Human Services, available at: http://aspe.hhs.gov/health/reports/2013/MarketplacePremiums/datasheet_home.cfm.
The HHI is generally calculated as the sum of squares of market share of the 50 largest companies. For example, if a state had five insurance carriers, and one carrier has 60% market share while the others each have 10%, the HHI would be 4,000 (because 60^2 + 10^2 + 10^2 + 10^2 + 10^2 = 4,000).