An Explanation of the Healthcare 80/20 rule – From FHF Jefferson

The Greater New Orleans Foundation says: You are Getting a Better Value for Your Health Care Dollar: The new health care law created the 80/20 rule, which requires that health insurers spend at least 80 percent of your health care premiums on health care or improvements to care or they must refund you the difference. This is also known as the medical loss ratio. In Louisiana, 75,500 residents will benefit from a total of $4.1 million in rebates this summer. Overall, 12.8 million Americans will be benefiting from $1.1 billion in rebates from insurance companies this summer. Learn more about this announcement at the Greater New Orleans Foundation website. %%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%% FOR IMMEDIATE RELEASE June 21, 2012 Contact: HHS Press Office (202) 690-6343 Health care law saves consumers over $1 billion Health care law provides rebates to more than 12 million consumers Today, Health and Human Services (HHS) Secretary Kathleen Sebelius announced that 12.8 million Americans will benefit from $1.1 billion in rebates from insurance companies this summer, because of the Affordable Care Act’s 80/20 rule. These rebates will be an average of $151 for each family covered by a policy. The health care law generally requires insurance companies to spend at least 80 percent of consumers’ premium dollars on medical care and quality improvement. Insurers can spend the remaining 20 percent on administrative costs, such as salaries, sales, and advertising. Beginning this year, insurers must notify customers how much of their premiums have been actually spent on medical care and quality improvement. Insurance companies that do not meet the 80/20 standard must provide their policyholders a rebate for the difference no later than Aug. 1, 2012. The 80/20 rule is also known as the Medical Loss Ratio (MLR) standard. “The 80/20 rule helps ensure consumers get fair value for their health care dollar,” Secretary Sebelius said. Consumers owed a rebate will see their value reflected in one of the following ways: .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 future premiums; or .their employer providing one of the above, or applying the rebate in a manner that benefits its employees. Insurance companies that do not meet the 80/20 standard will send their policyholders a rebate for the difference no later than Aug. 1, 2012. Consumers in every state 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 difference between what the insurer did or did not spend on medical care and quality improvement will be returned to them. For the first time, all of this information will be publicly posted on this summer, allowing consumers to learn what value they are getting for their premium dollars in their health plan. For many consumers, the 80/20 rule motivated their plans to lower prices or improve their coverage to meet the standard. This is one of the ways the 80/20 rule is bringing value to consumers for their health care dollars. For a detailed breakdown of these rebates by state and by market, please visit: For the text of these proposed notifications, please visit: For more information on the MLR provision in the Affordable Care Act: For more information on how the Affordable Care Act is creating a transparent market for health insurance, visit:


About watchdogofladisability

Hi, My name is Jason W. Weill and I am a 2007 graduate of the University of Louisiana at Lafayette as well as an individual diagnosed with Asbergers Syndrome, an Autism Spectrum Disorder. I created Watchdog of La Disability because I am a non-partisan watchdog who not only holds our leaders accountable in Baton Rouge but also turns heads. Watchdog of La Disability will also focus on important Disability related issues using the most powerful media sources in TV,Print, and Radio: KTBS-TV Shreveport, WWL AM/FM/TV New Orleans along with the Times Picayune Newspaper and WAFB-TV along with the Advocate in Baton Rouge. I hope you find my Watchdog side to be of use because being a watchdog means being fair to both sides and holding anyone accountable who decides to take avantage of the disabled.
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