Respectfully Submitted by Lawrence Rafferty (rafflaw)-Guest Blogger
I have to admit that I was not aware that the Affordable Care Act, or Obamacare, as its detractors call it, mandates that the insurance companies who don’t spend at least 80% of premium money on actual medical care expenses, must send rebates to policy holders. “But the rebate provision of the law — the fruits of the so-called “80/20 rule” — is about to kick in big time, as millions of Americans receive rebate checks or premium reductions from insurance companies who have failed to spend enough on patient care. This cash could be a true game changer in public attitudes about whether the law actually is beneficial and good public policy. The rebate provision of the law has been known and discussed in health care policy circles for months, but has largely flown below the radar in the political world and for voters—until now.” Time
These rebates or premium reductions could not only be a big financial benefit to millions of policy holders, it could also be a big political boost for the Obama Administration in its attempts to convince the public of the many benefits provided by the Affordable Care Act (ACA). Now that I know that the ACA will provide these rebates, just how much money are we talking about? The Time Magazine article linked above quotes a Kaiser Family Foundation study that suggests that big dollars are involved here. “This analysis looks at the latest estimates provided by insurers to state insurance commissioners.The analysis finds that consumers 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.Rebates are expected to go to almost one-third (31%) of consumers in the individual market. Among employers, about one-quarter (28%) of the small group market and 19% of the large group market is projected to receive rebates. The share of consumers in the individual insurance market expected to receive rebates ranges from near zero in several states to as high as 86% in Oklahoma and 92% in Texas. “ KFF
$1.3 Billion dollars is a significant amount that will be soon heading to the pockets of millions of policy holders. I was especially interested in the states like Texas and Oklahoma where almost every policy holder in the respective states will be receiving a rebate. Would it be a fair question to ask what are Texas and Oklahoma not doing to protect its citizens from insurance companies who may be pocketing more money and providing less care per health care dollar?
The ACA is a complicated law and it wasn’t the single payer plan that I was hoping and working for, but it has already helped millions by mandating that children can stay on Mom and Dad’s policies longer and by protecting patients from being denied coverage for pre-existing health issues. Now that the 80/20 rule rebates are about to kick in, millions more people will feel a real benefit in their pocketbooks thanks to the ACA. Now, if we can just get the Supreme Court to forget its partisan ways, maybe all of us can begin to benefit from the Affordable Care Act. What do you think of the Affordable Care Act and the 80/20 requirement? Will the rebate checks and premium reductions mandated by the bill have an impact on people’s lives and their opinions of the Act? If you have time on this beautiful Mother’s Day, let us know what you think. By the way, Happy Mothers Day!
Additional source: Raw Story
Link to the full Act: Health Care.Gov