Report from Commonwealth Fund shows that the health insurance industry is faring well
A new report from the Commonwealth Fund shows that the health insurance industry is doing quite well. There have been concerns that the insurance industry in the United States may suffer as a result of the Affordable Care Act. The legislation was signed into law in 2010 and some insurers had expressed worry over some of the provisions of the federal law. These concerns had to do with how the law would affect the way they do business as well as the increased costs they would face due to new regulations.
Provisions of the Affordable Care Act are not as damaging as had been feared
Over the past few years, fears regarding the Affordable Care Act have diminished. Several health insurance companies have seen their stock prices skyrocket and more companies have acquired policyholders than they had in the past. The report suggests that insurance companies are making more money, despite the fact that they are no longer allowed to deny coverage to those with pre-existing medical conditions and they are spending more money on complying with federal insurance regulations.
$5 billion in consumers savings have been generated by the Affordable Care Act
The report from the Commonwealth Fund shows that the Affordable Care Act has also generated some $5 billion in consumer savings over the past three years. Insurers have also had relatively little trouble complying with one of the provisions of the Affordable Care Act, known as medical loss ratio. According to federal law, insurers must spend no less than 80% of the money they collect from premiums on improving health care for consumers. If insurers do not meet this requirement, they must provide refunds to their policyholders. In 2013, insurers refunded some $325 million, which is less than one-third of the amount that insurers had to refund in 2011.
More consumers get access to health insurance coverage
The health insurance industry appears to be doing very well as a result of the Affordable Care Act. The federal law has not only helped the industry perform better, of course, as it has also brought more benefits to consumers. More people in the United States now have access to health insurance coverage, which they had lacked in the past.