Rebates generated by medical loss ratio provision
The Department of Health and Human Services (HHS) has announced that U.S. health insurance consumers are due to receive significant rebates in the coming months. The agency claims that millions of people throughout the country are eligible to receive $1.1 billion in health insurance rebates this year. The rebates are linked to the failure of several insurance companies who were unable to meet a federal standard imposed by the Affordable Care Act. The standard is often referred to as the medical loss ratio.
Provision aims to provide consumers with adequate medical care
According to the medical loss ratio provision of the health care reform law, insurance companies are required to return money to consumers if they are unable to spend at least 80% of the money they collect in premiums on medical care. According to the HHS, many of the country’s health insurance companies have fallen short of the standard. These companies will be held responsible for issuing the health insurance rebates that could help offset the financial burden of insurance coverage.
Rebates may vanish if Affordable Care Act is struck down
There may be a problem, however. If the Supreme Court determines that the Affordable Care Act is unconstitutional and dismantles the law entirely, consumers may never see the money from their health insurance rebates. Insurance companies would not be required to comply with the provisions of the health care law because of its unconstitutional status, thus will not be required to issue these rebates. If the law is upheld, consumers can expect to see their rebates come in a variety of forms. Some will receive checks in the mail, while others will see their rebates credited toward their premiums.
HHS to push for the issuance of health insurance rebates
The uncertain future of the Affordable Care Act has caused some turmoil in the country’s health insurance industry. The HHS claims that it will push for the delivery of health insurance rebates despite this turbulence, as long as the Affordable Care Act remains in effect.