Individuals and employers are set to receive $1.3 billion in health insurance rebates because of an Affordable Care Act provision, U.S. officials say.
One of the provisions of healthcare reform requires large-group healthcare plans to spend at least 85 percent of the premium dollars they take in on medical claims and not administrative costs, officials, marketing and profits. For individual and small-group markets, insurers need to spend 80 percent of premiums on actual medical care.
An analysis by the Kaiser Family Foundation found consumers and businesses should receive $186 million in Texas and $149 million in Florida. Hawaii is the only state where no insurer is projected to issue a rebate, the analysis said.
Cynthia Cox, a fellow at the Kaiser Family Foundation in Menlo Park, Calif., said the rebates will come Aug. 1 in the form of a check or in premium discounts, allowing consumers to skip a month or two of payments until the debt zeros out, Marketwatch reported.
Nearly one-third of those who buy insurance on their own are expected to receive rebates, compared with 28 percent of the small-group market and 19 percent of the large-group employer markets, the analysis said.
Consumers are estimated to receive $127 on average -- from $305 in Alaska, $294 in Maryland and $243 in Pennsylvania.
If the Supreme Court finds the mandate unconstitutional, the ruling may unravel some or all of the healthcare reform features already in place, Cox said. (c) UPI