by Lena Groeger
ProPublica, March 16, 2012, 1:01 p.m.
This summer, health insurance companies may have to pay
more than a billion dollars back to their own customers. The rebate
requirements were introduced as part of the 2010 health-care reform law
and are meant to benefit consumers. But now an insurer-supported Senate
bill aims to roll back the rebate requirements.
Known as the medical loss ratio rule, it’s actually pretty simple. Under the health-care law provision, 80 to 85 cents of every dollar insurers collect in premiums must be spent on medical care or activities that improve the quality of that care. If not, they must send their customers a rebate for the difference. The goal, according to the Department of Health and Human Services, is to limit the money insurers spend on administrative costs and profit.
Known as the medical loss ratio rule, it’s actually pretty simple. Under the health-care law provision, 80 to 85 cents of every dollar insurers collect in premiums must be spent on medical care or activities that improve the quality of that care. If not, they must send their customers a rebate for the difference. The goal, according to the Department of Health and Human Services, is to limit the money insurers spend on administrative costs and profit.
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