You could profit off your health insurance

In yet another part of the new health-care law that favors consumers, insurance companies will be forced to spend a minimum of the premium you pay on health care and quality. For smaller companies the figure is 80 cents on the premium dollar. For employer plans covering over 50 people, the requirement is 85 cents. This is similar to a law passed a few years ago requiring charities to spend a minimum of your donations on the cause for which they are collecting.

If the insurer fails to meet the minimum, they will be forced to issue rebates to customers. The idea is to encourage better health care over excess spending on administration, marketing and executive bonuses by the insurance company. Some insurers are already complaining, which might indicate an inequality in paid premiums on their part to health care delivered.

Others are threatening to stop offering insurance to the individual market, with Georgia, Iowa, Maine and So. Carolina afraid this could lead to loss of coverage. But industry analyst, Les Funtleyder, says Health and Human Services has considerable latitude in making adjustments for insurers’ marketing needs. It would seem that the consumer can expect a higher quality of health care with this new ruling since many plans only spend from 60 to 80 cents on the dollar.

The new rule goes into effect January 1, and in 2012 up to 9 million customers could get rebates averaging $164. It’s nice to know for once that the consumer is getting a break with the greedy health insurers paying the bill. It is also pathetic that this must be done to keep these companies honest. The $164 could be a discount on premiums or payment direct to policyholder.

In the future, customers can shop for health insurance using this new gauge of just how well insurers pay benefits, but must be mindful of the new jargon. The ratio companies spend on care is “medical loss ratio.” They’ve known this all along but as long as they were able to get away with spending only 60 percent of your premium on your health care, the greedy ones did it.

And remember, the Republicans have said repeatedly that they would repeal the health care act.

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