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Sebelius: CT Residents to Benefit From Rebates

WASHINGTON, D.C. — Health and Human Services Secretary Kathleen Sebelius on Thursday announced that 47,593 Connecticut residents will benefit from more than $5 million in rebates from insurance companies this summer, averaging $168 per family.

This is all due to the Affordable Care Act, federal officials said in a press release.

According to the release,  77.8 million American consumers saved $3.4 billion up front on their premiums as insurance companies operated more efficiently.  Additionally, consumers are expected to save $500 million in rebates, with 8.5 million enrollees due to receive an average rebate of around $100 per family.

How did this come about?

Created under the Affordable Care Act, the Medical Loss Ratio standard (also known as the “80/20 rule”) requires insurers to spend at least 80 cents of every premium dollar on patient care and quality improvement.  If they spend an excessive amount on profits and red tape, they owe rebates back for the difference no later than August 1, 2013.

“This new standard is increasing transparency and accountability, promoting better business practices and competition among insurance companies, and ensuring consumers receive value for their premium dollars,” Sebelius said.  “Today’s announcement shows that more Connecticut residents are benefiting from the tools created under the Affordable Care Act to keep consumer costs down.”

Officials said that other Connecticut residents will see their value reflected through rebates later this summer.

Connecticut residents owed a rebate will see their value reflected in one of the following:

  • a rebate check in the mail
  • a lump-sum reimbursement to the same account that they used to pay the premium if by credit card or debit card
  • a reduction in their premiums
  • their employer using rebates to improve their health coverage.

Insurance companies that do not meet the standard will send consumers a notice informing them of the rule  The notice will also let consumers know how much the insurer did or did not spend on patient care or quality improvement, and how much of that difference will be returned as a rebate.

For an overview of insurers’ MLR data in 2012, please visit: Loss Ratio

For more information on the MLR provision in the Affordable Care Act:


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