Franken, Rockefeller Secure Medical Loss Ratio Provision in Manager's Package

Press Release

Insurance Companies Will Have to Spend More on Care for Families, Less on Profits

U.S. Sens. Al Franken (D-Minn.) and Jay Rockefeller (D-W.Va.) have hailed the inclusion in the manager's amendment of a provision that requires health insurance companies to put 85 percent of premiums (85 percent in the large group market, 80 percent in the small and individual group markets) toward actual health services, not administrative costs, marketing campaigns, or profits. This provision is a permanent requirement modeled on the Franken-Rockefeller Ensuring Value for Premiums Act.

"Advocates have been trying to get these profit restrictions in place in many states, often with limited success. While I remain deeply disappointed that the public option is not part of this bill, this potent measure Senator Rockefeller and I have been fighting for will limit insurers' profits and put the brakes on skyrocketing insurance premiums," said Sen. Franken.

"Senator Franken and I have been fighting to make sure health insurance companies spend more of their premium dollars on actual health care--not excessive corporate salaries," said Sen.Rockefeller, who chairs the Senate Commerce Committee and has spearheaded investigations into health insurance company spending. "Gone are the days of health insurance companies running rampant without oversight and accountability -- now they must be accountable to consumers and spend more of their hard-earned dollars on actual health care and not on filling their coffers. Even though we were not able to secure a public option, this legislation achieves significant private health insurance industry reform."

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