3,360,858 Americans to Receive Health Insurance Rebate

The Affordable Care Act requires insurance companies offering policies to individuals and small businesses to spend at least 80 percent of premium income on health care claims and efforts to improve quality of care. Insurers that fail to comply are required to issue consumer rebates by August.
That means 3,360,858 Americans enrolled in individual health insurance plans will receive a refund averaging approximately $126 from their insurers (with a total amount of $426,192,338 worth of rebates), according to a recent report from the Kaiser Family Foundation. These refunds will put real money in the hands of real people, providing another tangible benefit of the Affordable Care Act for health care consumers across America.

However, the 80-20 provision, referred to as Medical Loss Ratio in the law, is impacting
other health care consumers as well. The presence of the 80-20 threshold and corresponding rebates from insurers that fail to meet it is providing an incentive for insurers to seek lower premium increases and improve their delivery of health coverage. Premium dollars that might otherwise have been spent on administration or marketing are now being directed to providing health care benefits.

The 80-20 provision will not control rising health insurance premiums by itself. But it is helping ensure that consumers and businesses receive greater value for their premiums. Contact your insurer or state insurance commissioner to determine if you’re eligible, and remember, whether or not you receive a rebate, the Affordable Care Act is helping hold the line on the cost of your health insurance.

To view the report and individual state figures go to:
http://www.kff.org/healthreform/upload/8305.pdf

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