Are You Getting a Health Insurance Premium Rebate?
Back in April, I mentioned that some of us might be getting rebates from our health insurance companies because of The Affordable Care Act’s provision that required health insurance companies to spend at least 80 to 85 percent of health insurance premium dollars on actual medical care, and not on administrative costs. If they didn’t do that, they would be required to give customers the difference.
It looks like I’ll be getting some money back, and I’m curious to know if others have been receiving letters as well. I’m not sure how much the check will be, but I’ll be sure to post it once I receive it in the mail. It could be pennies, or tens of dollars—who knows! To be continued.
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Previously on The Billfold
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I got $23.48 back from one of my two insurance companies for 2011, Golden Rule, to whom I paid $120/month for extremely minimal coverage for two months because I found a lump in my breast and applied for individual health insurance before getting it checked out (thus making me wait two more months before I could learn that I was fine). Then I got a job that subsidized health insurance, and they wrote to inform me that they did not owe me a rebate, by a pretty health margin. I didn’t have health insurance at all for the first 8.5 months of 2011, or most of 2010 either.
I got my letter in late May, and my check in early June. I got the letter from the other insurance company just a couple of days later. Sounds like Florida actually led the way in exactly one item relating to the ACA… heh.
Nope. My insurance plan is changing next year (getting worse) because it was a “Cadillac plan.” CONFLICT! Support Obamacare, but am sad about losing my great insurance plan for mediocre and more expensive insurance plan!
You can find the average rebate per subscriber here if you can’t bear to wait. Also note that checks only go to people with individual health insurance; if you are on an employee/group plan, the company gets to decide how to spend it (though it has to benefit the employees — they can apply it towards premiums, lower copays, or send out checks). I’ve just emailed HR to ask what they intend to do with ours.
@stuffisthings I was wondering about the situation where companies are paying for health insurance. I’m interested to know what HR’s response to you is!
@redheaded&crazy Unfortunately she’s out of the office today. I looked up my plan and if we are on the small group plan, which I doubt, then our average rebate per subscriber would be $207. If we’re on the large group plan it would be just $22.
Generally, group plans for employers have much lower overhead (because they don’t screen each person) so the rebates will be lower.
@stuffisthings I’m not sure what the exact amount of our rebate was but my boss waived the employee contribution during our last pay period. For me, that was $42.58 which I’m pretty sure is more than what my share of the refund was. My boss is a super nice guy. Not always the best business man, but a super nice guy :)
@stuffisthings Hmm, all that says for my insurance company (Kaiser Permanente) is “Not Applicable,” so I’m not sure what that means, because it does meet the standards. Maybe I’ll bug HR about it.
I got this letter last week and was very excited, until I got to the part where it said, “In your state, [Insurance Company] did not meet the 80/20 standard. In 2011, [Insurance Company] spent only 80% of a total of [giant number] in premium dollars on health care and activities to improve health care quality. Since it missed the 80 percent target by 0% of premium it receives, [Insurance Company] must rebate 0% of the total health insurance premiums paid by the employer and employees in your group health plan.”
Nonsensical and disappointing!
I have no idea what the average premiums people pay are, but it seems to me that some people could stand to get a decent amount of money back. Then again, I imagine the way it’s supposed to work is that people paying higher premiums are supposed to be the people who would use the health care system more.
@redheaded&crazy That’s true for individual plans, and that is where people should see the biggest rebates. Group plans are cheaper to administer and are designed to spread risk evenly, so everyone pays the same, though people pay more for family plans. Generally the larger your premium, the larger the rebate, all other things being equal. For instance, say your annual premium is $2,000 and your insurance company spent 30%. You would get 30% – 20% = 10% of $2,000 = $200 back. If you had the same insurance company and your premium was $1,500, you’d get $150 back. And so forth.
@stuffisthings If they spent 30% and they are supposed to spend 80% shouldn’t you get 50% back? (sorry, I obviously don’t really understand how this works) (and i appreciate you explaining it even though it doesn’t affect me!)
@redheaded&crazy Sorry I meant they spent 30% on administration, marketing, etc., meaning they spent 70% on health costs (instead of the required 80%).
@stuffisthings ohhh got it. thanks!
Hey, I’m on Oxford and they told me that they had met the requirements (in New York at least). I got the letter a few weeks ago. I pay through the roof too, I was totally expecting money back.
Mike, I just read your letter more closely and it sounds like you are on a group plan, so the money will go to your employer, not you. I think you should have an Awl pizza party!
@stuffisthings The plan is from my old company, and since I don’t work there anymore, the letter says that the company must “provide a cash rebate to employees or subscribers that were covered by the health insurance on which the rebate is based.” But maybe I’ll throw a pizza party anyway. $1 slices for everyone!
@Mike Dang GET A KNIFE JUGGLER
I got $16.33 back from Blueshield CA last week. I’m rich!
Until a week ago, I was under the foolish assumption that the 80/20 rule applied to each individual’s premium dollars, and not the entire group of individual policy holders. I’m about as stupid as that $2.50 check from Anthem collecting dust on my desk.
Got a whopping $0.94 check from Anthem Blue Cross. This rebate is a joke.
I feel like a baller, I got $130 check! What does that mean? Humana is particularly wasteful? I pay way too much for my high deductibale indiviudal plan (yay having two part time jobs so no work insurance!) What was even better is that I got the check before I had any idea this was a thing and they sent the letter explaining it a week later. All it said was “here is your refund required by the Adordable Care Act.” I was just like “thanks Obama!”
HR sent out some kind of notice. i think instead of us employees getting checks, my company is getting the money and they said they are in the middle of negotiations for 2013 rates, which the insurers are hiking up, so they’ll likely be using the rebate money to offset the increase to our premiums.