A new report estimated insurance consumers benefited from $1.5 billion in either rebates or reduced costs last year, due to requirements of the healthcare overhaul. But insurers warned that money could have funded anti-fraud and quality-improvement programs.
Research supported by the Commonwealth Fund, which backed the Patient Protection and Affordable Care Act, concluded that the law's medical loss-ratio requirements implemented in 2011 provided big savings—mainly in the individual insurance market.
Individual market policyholders had “substantially reduced premiums” due to the law's requirement that insurers spend at least 80% of premium dollars on direct healthcare or quality-improvement activities, or else pay a rebate to their customers, according to the report. Those requirements led administrative costs to drop in 39 states, medical loss ratios to improve in 37 states, and operating profits to fall in 34 states, according to the report.