The Affordable Care Act (known to all as “ObamaCare”) contains an 80/20 rule. Your HMO must spend at least 80% of your premium on health care and health-related services, or they must refund the difference to you. Through something known as the Medical Loss Ratio, the average amount your health care provider spent on patient care is calculated for each state. If the average amount your HMO spent falls X% below the 80% target, then each policy covered by that HMO within your state will be reimbursed X% of their respective premiums.
According to the Kaiser Family Foundation:
[C]onsumers and businesses are expected to receive an estimated $1.3 billion by this August in rebates from health insurers who spent more on administrative expenses and profits than allowed by the ACA. The rebates include $541 million in the large employer market, $377 million in the small business market, and $426 million for those buying insurance on their own. Rebates in the group market will generally be provided to employers, and in some cases be passed on to employees as well. The size of the checks will vary, but for many working Americans, they are likely to be the most tangible, and welcome, sign of the law’s benefits.
The size of the checks will vary, but for many working Americans, they are likely to be the most tangible, and welcome, sign of the law’s benefits. TIME provides a partial breakdown of disbursements by state:
|STATE||NUMBER OF RECIPIENTS||TOTAL DISBURSEMENT|
Kathleen Sebelius says it well in her blog post:
When we pay for health insurance, we want to know that most of what we are paying for is for health care, not advertising, executive bonuses or overhead. It’s pretty simple: we want to get a good value for our premium dollars.
We concur Madame Secretary; and those Republicans who want to repeal ObamaCare can keep their Mitts off our money!
Thank you, Mr. President!