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Culp-Ressler reports: "Millions of Americans can expect to get a refund from their insurance companies this year, at an average of about $80 dollars per family, thanks to a little-known Obamacare provision that's helping people save money on their premiums."

Obamacare is saving Americans money. (photo: Shutterstock)
Obamacare is saving Americans money. (photo: Shutterstock)


Obamacare Has Helped Americans Save Nearly $2 Billion on Their Insurance Premiums

By Tara Culp-Ressler, ThinkProgress

25 July 14

 

illions of Americans can expect to get a refund from their insurance companies this year, at an average of about $80 dollars per family, thanks to a little-known Obamacare provision that’s helping people save money on their premiums. According to a new report released by the Health and Human Services Department on Thursday, Americans across the country have received a total of $1.9 billion dollars in rebates since this provision first took effect in 2011.

Obamacare’s medical loss ratio provision — which is also frequently referred to as the “80/20 rule” — requires insurers to spend at least 80 percent of every American’s premium costs on their medical care, rather than on the company’s own profits or administrative overhead. If insurance companies don’t hit the right balance, they have to issue a refund check to their customers to make up for it.

According to HHS’s calculations, 6.8 million Americans will save $330 million in refunds this year because of the 80/20 rule. Insurance companies are required to provide those reimbursements by no later than the beginning of August. Not everyone will actually receive a physical check in the mail; insurers are allowed to apply the reimbursements to future premiums, so the savings could show up that way.

In a press release announcing the new data, HHS Secretary Sylvia Burwell said that the health reform law is giving Americans a “better value for their premium dollars.” The whole point of the 80/20 rule is to encourage insurance companies to operate more efficiently and cut down on their overhead — and it’s slowly working. The portion of premium dollars allocated to insurers’ profits and administrative costs dropped from 15.3 percent in 2011 to 11.7 percent in 2013.

HHS estimates that if insurers weren’t making those type of changes, Americans would have likely paid about $3.8 billion in additional premiums in 2013. Altogether, since the medical loss ratio took effect three years ago, the administration calculates that it’s averted $9 billion dollars worth of unnecessarily high insurance premiums.

The 80/20 rule isn’t the only Obamacare provision that seeks to keep premium costs affordable. The health law also extends federal subsidies to help Americans purchase plans on the individual market in the new state-level insurance exchanges, something that allows millions of people to buy health care for less than $100 each month. However, under a lawsuit against the health law that could make its way up to the Supreme Court, those subsidies could be put into jeopardy in the majority of states in the country. If that happens, insurance premiums could increase by about 75 percent.

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-1 # nice2bgreat 2014-07-25 12:31
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There sure is great effort to sell Obamacare as a success, without discussing actual health care, whether it is numbers of people signed up for Obamacare (INSURANCE) -- under threat of fines or jail -- vs. the number of projected signups, the percentage increase of signups ... since 2009 ..., and now the savings of nearly $2 billion.

None of these figures accurately assesses costs, effectiveness, nor whether people have truly affordable access to actual health care.

Deductibles, co-pays, and bureaucracies all effect whether the system is used and provides actual health care. Reports like these are simply statistical devices to create an illusion health care.

To discuss front-end savings, as if deductibles, co-pays, and tax subsidies in the middle and at the end, are not financial burdens that offset initial insurance premiums, is just dishonest.

I am not suggesting that some people are not better off at the moment, but on the whole, it is far too early to assess the benefits of the ACA vs. problems associated, using statistics like these; nor do success stories suggest that the ACA is vindicated for the long-term.

These deceptive and irrelevant report statistics are little more than for feeding talking points to Democratic operatives and apologists.

All these strangely inconsequential statistical "successes" are nothing more than attempts to control the political message in the run-up to the General Elections in November, and likely into 2016.
.
 
 
+5 # Urbancurmudgeon 2014-07-25 13:10
nice2bgreat may be right about it being too early to evaluate Obamacare but if he is, then how about the scurrilous right-wing detractors who have been telling us how it is a disaster ever since it became law. If he is correct about the Democrats only using these statistics to make political points then what about the lies and innuendos spread by such idiots as Ted Cruz, Mitch McConnell and the like, none of which had any basis in truth and all of which were just right-wing political talking points.

Maybe the bottom line should be whether or not the average Joe is better off with Obamacare than he was before it existed. Interestingly enough 78% of Democrats think so and bizarrely 74% of Republicans do too.

So how about the Right dropping all the political BS and backing off, so the American people can get a break from their inept attempts to destroy the country, in order to attain their own selfish, greedy goals.
 
 
+1 # Urbancurmudgeon 2014-07-25 13:10
nice2bgreat may be right about it being too early to evaluate Obamacare but if he is, then how about the scurrilous right-wing detractors who have been telling us how it is a disaster ever since it became law. If he is correct about the Democrats only using these statistics to make political points then what about the lies and innuendos spread by such idiots as Ted Cruz, Mitch McConnell and the like, none of which had any basis in truth and all of which were just right-wing political talking points.

Maybe the bottom line should be whether or not the average Joe is better off with Obamacare than he was before it existed. Interestingly enough 78% of Democrats think so and bizarrely 74% of Republicans do too.

So how about the Right dropping all the political BS and backing off, so the American people can get a break from their inept attempts to destroy the country, in order to attain their own selfish, greedy goals.
 
 
-1 # Yachtsman 2014-07-25 14:14
Isn't the refund the insurers are required to pay to their customers a refund of premiums already paid to the insurance companies? If that is the case, then it’s not really a NET savings for anyone. It just means the patients will be paying less than they had originally thought, but there’s no real savings there. It’s like those taxpayers who think they’re getting a gift from the IRS when they get their annual tax refund!! It just means they had too much of their incomes deducted by the IRS in the first place. The real way to determine if there is any savings is to compare the final premium paid (after deducting the refund) to the premiums paid before Obamacare – assuming, of course that the benefits/covera ge the patients receive are equal.
 
 
+1 # julieziesman 2014-07-25 14:27
How much out of every dollar that you pay in health insurance premiums do you want to go to your health care services? Thanks to the Affordable Care Act (Obamacare) there are requirements that prevent excessive overhead costs or profits. One of the intents of the law is to bring down health care costs.
The 2011 rule states that policies covering individuals or small businesses can only spend up to 20 percent on administrative costs or profit. Large group plans can only spend up to 15 percent of premiums on administrative costs or profit. Wellmark Blue Cross and Blue Shield individual health insurance policy holders were rebated $652,000 from their Wellmark Health Plan of Iowa. Coventry is paying more than $1.1 million to employers who paid for group insurance policies in Iowa.
With rebates and other requirements in the law, health care costs have steadily declined since the 2011 Affordable Care Act was implemented.
 
 
-2 # LAellie33 2014-07-27 15:50
WOW! If I didn't know better I would swear this was The Fox & Freaks Lie, Misinformation, and fear-mongering hatred site. The ACA or Obamacare, one and the same, is the long overdue affordable healthcare desperately needed by all Americans (except of course the greedy millionaires and billionaires who would rather see Americans starve to death, and die because they couldn't see a doctor -- than take away a penny of the big corporations profits. America the Exceptional has become America the UNexceptional thanks to the greedy, corrupt bastard Kochroach brothers and their ilk. AMERICANS: WAKE UP & VOTE DEMOCRAT BLUE ON EVERY RACE. ON EVERY BALLOT.
 

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