Reid: New Rule Ensures Premiums Pay For Health Care, Not CEO Salaries
November 22, 2010
Washington, D.C. – Nevada Senator Harry Reid made the following statement on a rule issued today by the Department of Health and Human Services, requiring health insurance companies to spend 80 to 85 percent of premiums on health care and quality improvements for patients.
“This provision is another example of how the new health insurance reform law is working for Nevada families. Nevadans work hard so their families can have access to quality health care. These new rules ensure that their hard-earned money is spent on health care, not to cover insurance executive salaries and marketing costs. The health reform law, and rules like this, were designed to create a quality health care experience and ensure that consumers are getting their money’s worth out of their health insurance. I will continue to work with Nevada experts to ensure this rule and the other provisions of the Affordable Care Act continue to benefit Nevada consumers and patients.”
According to the U.S. Department of Health and Human Services, the new medical loss ratio rules will help consumers by establishing greater transparency and accountability, ensuring Americans receive value for their premium dollar, and providing rebates to consumers. This new rule will go into effect in 2011. Insurers who have not redirected premiums so that at least 80 percent goes to customer care will be required to provide a rebate to their customers starting in 2012.
For more information about these new rules, consumers can read the following fact sheet prepared by the Department of Health and Human Services at http://www.healthcare.gov/news/factsheets/medical_loss_ratio.html.