Rep. Ron Kind Praises the Affordable Care Act for Saving Consumers a Total of $3.9 Billion on Premiums in 2012

Press Release

Rep. Ron Kind (D-WI) responded to a recent Health and Human Services (HHS) report finding that 77.8 million consumers nationwide saved $3.4 billion up front on their premiums as insurance companies operated more efficiently under the Affordable Care Act (ACA), and that consumers will benefit from $500 million in rebates thanks to ACA reforms.

"This is more proof that the Affordable Care Act is starting to deliver the health care reform that we need to rein in costs while providing the care that people need," said Rep. Kind."These are the kinds of tangible results that we'll be seeing more of as the ACA continues to take effect."

The study determined that insurers will return more than $500 million to more than 8.5 million health insurance customers across America, thanks to an ACA requirement that carriers spend at least 80 cents of every premium dollar on medical care instead of administrative costs. More than 140,000 Wisconsin residents will benefit from over $3.5 million in rebates from insurance companies this summer, averaging $46 per family, thanks to the health care reform law.

To stabilize premium rates, 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 administration and profits, they owe rebates back for the difference. Insurance companies that do not meet the standard will send consumers a notice informing them of how much the insurer did or did not spend on patient care or quality improvement, and how much will be returned to them as a rebate.

"Families in Wisconsin and across the country are benefitting from the Affordable Care Act," concluded Kind. "This new standard is increasing transparency and accountability, promoting better business practices and competition, and ensuring that health care consumers get real value for their health care dollars. But more work needs to be done to deliver better quality care at a better price."

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