Today’s #HCR Moment: The Rebate Checks

Crossposted from Democratic Convention Watch

Remember the ACA facet which says that health insurers must rebate to policyholders the amount of money policyholders paid in premiums that did not go to health care costs if those costs are less than 80%/85%? The percentage was dependent on whether it was a group or individual policy. Those checks are going to go out soon, and the first paragraph of the attached letter will say:

“This letter is to inform you that you will receive a rebate of a portion of your health insurance premiums. This rebate is required by the Affordable Care Act—the health reform law.”

Kaiser has done some work on the actual numbers:

The largest rebates overall are projected to go to consumers and businesses in Texas (total $186 million) and Florida ($149 million); Hawaii is the only state where no insurer is expected to issue a rebate.

Consumers receiving rebates in the individual market are projected to receive $127 on average, with amounts varying significantly by insurer and state. The average rebates for individual purchasers expected to receive them range from just a few dollars in some states to as much as an average of $305 in Alaska, $294 in Maryland, $243 in Pennsylvania, $241 in Idaho, and $236 in Mississippi.

If you have a WSJ subscription, you can see the full breakdown by type of policy, amount of average rebate and state here.  That chart indicates that the total number of Americans who will receive rebate checks is:

Individual policyholders: 3,360,858
Small Group policyholders: 4,932,786
Large Group policyholders: 7,475,657
Total:  15,769,301

That's almost 16 million people. Trying to find the number of people who have private health insurance is a little tricky. We know that about 87 million people have insurance, but many of them are covered by government programs (Medicare, Medicaid, SChip, military benefits, government workers). Depending on whose statistics you believe, the number of people covered by employer plans runs between 42% and 48%. Thus, the overall conclusion is that as health insurance rates keep climbing, and the number of uninsured keep rising the premium dollars are NOT going to health care costs, but rather to the companies. Which, ahem, now have to send that money back.

So let's recap: the Affordable Health Care Act is working! It's decreasing the amount of money that just gets kept by the insurance companies who keep saying they need to raise premiums to cover costs. (Liars.) This is in addition to the other benefits of covering more people including offspring in their 20's, people with pre-existing conditions, people who don't receive employer benefits and cannot afford individual plans on the open market, plus the decreased Medicare donut hole, and free preventive services. And yet, people seem not to like this, according to most polling. Yet another Ich Kreplach moment, but a win for most Americans nonetheless. 


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