Consumers in the state will be issued the rebates in some form by August 1 by their insurers.
According to the latest data from the U.S. Department of Health and Human Services, Massachusetts insurance customers who purchased or renewed their health plans in 2013 were able to save $4.1 billion on their premiums, that year.
This year, the health care reform will bring over $15 million in refunds to those same consumers.
The Massachusetts insurance rebates will be the second largest among all of the states in the country. The average family will receive about $133. The national average, on the other hand, will be about $80, as 6.8 million people split $332 million in refunds. The state that has the largest refunds headed to health plan owners is Florida, where the total amount to be refunded to residents of the state will be $41.5 million.
Even though almost Massachusetts insurance covers nearly every resident of the state, costs still lead to financial struggle.
An estimated 1 in four people in Massachusetts still struggle with financial issues as a result of the high costs related to health care. This, regardless of the fact that nearly everybody in the state has some form of health plan.
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The Affordable Care Act’s Medical Loss Ratio was put into place in 2011 and requires that in the individual and small group market, a minimum of 80 percent of premiums must be spent on providing consumers with medical care or on improving the quality of health care. In the large group market, that figure changes to 85 percent.
A statement released by Sylvia M. Burwell, the Secretary of Health and Human Services, said that “The 80/20 rule is bringing transparency and competition to the insurance market, ensuring that consumers are continuing to receive value for their premium dollars,” adding that “Standards like these created under the health care law are providing Massachusetts residents with immediate savings and are helping to keep costs down over the long-term.”
As Massachusetts insurance companies spent over the allowable amount, the excess is now being refunded to consumers who had been paying premiums for their health plans.