Obamacare Rule Triggers Huge Rebates

BloombergBusinessweek: “One of the less discussed pieces of the Affordable Care Act is a measure to control insurance premiums by limiting how much companies can spend on stuff other than medical claims. Expenses for marketing, fees to brokers, administrative costs, profits, and the like can’t take up more than 20¢ of each premium dollar (or 15¢ for large-group plans). Any amount collected above that threshold must be returned to customers.”

The medical-loss ratio rule “has resulted in rebates of $1.6 billion to individuals and businesses over the last two years, according to a new tally of federal data from the Commonwealth Fund, a health research foundation.”


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