Virginia health policy holders to get $43.1 million in rebates
- June 21, 2012
Some 376,000 families in Virginia will receive health insurance rebates averaging $115 apiece this summer, according to the U.S. Department of Health and Human Services.
The rebates, totaling $43.1 million, are the result of premium overcharges as determined by the federal health care law.
The U.S. Supreme Court is expected to rule on the constitutionality of the law, the Affordable Care Act passed by Congress in 2010, before the end of June.
The law’s “80/20 rule” requires insurance companies to spend at least 80 percent of consumers’ premium dollars on medical care and improvements in the quality of care. Insurers can spend the remaining 20 percent on administrative costs, including salaries, sales expenses and advertising.
Insurance companies that do not meet the 80/20 standard are required to provide their customers a rebate for the difference no later than Aug. 1. The 80/20 rule is also known as the Medical Loss Ratio (MLR) standard,
Virginians owed a rebate will receive it one of the following ways:
• a rebate check in the mail;
• a lump-sum reimbursement to the same account that is used to pay the premium if by credit card or debit card;
• a reduction in their future premiums; and
• their employer providing one of the above, or applying the rebate in a manner that benefits its employees.
Consumers will also receive a notice from their insurance company informing them of the 80/20 rule, whether their company met the standard, and, if not, how much of a difference between what the insurer did or did not spend on medical care and quality improvement will be returned to them.
Information about the rebates and the 80/20 rule will be posted on the website http://www.HealthCare.gov.