Today, Congressman Andrews announced that the U.S. Department of Health and Human Services (HHS) recently reported that the Affordable Care Act (ACA) has saved consumers $3.9 billion on their health care premiums last year. Accoring to the report, 220,010 New Jersey residents will receive $10,768,382 in rebates from insurance companies this summer, an average of $104 per family.
Under the ACA, insurers must spend at least 80 cents of every premium dollar collected on patient care and quality improvement. This rule, known as the "80/20" rule, further states that if insurers spend more than 20 percent of the premiums they collect on administrative costs or salaries, they must pay a rebate back to consumers. As a result, an HHS report found that compared to 2011, insurance companies devoted more premium dollars to patient care and less to expenses and red tape in order to comply with the law's requirement. In short, the data in the report show that the law has motivated many plans to lower prices or improve their coverage to meet the new standard.
"People are tired of rising health insurance premiums and this is one more tool the Affordable Care Act has provided to control these costs without jeopardizing quality of care," said Rep. Andrews.
As an original author of the ACA, Congressman Andrews remains committed to ensuring the recent reforms to our nation's health care system will continue to help millions of Americans gain access to quality, affordable health care.