Who gets health insurance rebates?

Rebates totaling $1.3 billion from health insurance companies should go to more than 3 million individual policyholders and thousands of employers this year, a report from the Kaiser Family Foundation shows.
By The Associated Press Published: April 27, 2012
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Rebates

Rebates from health insurance companies should go to more than 3 million individual policyholders and thousands of employers this year, a report from the Kaiser Family Foundation shows. Here's how President Barack Obama's health care law works:

• Insurers covering individual consumers and small employers must spend at least 80 percent of the premiums they collect on medical care and quality improvements. The benchmark is 85 percent of premiums for insurers covering large employers.

• Companies must provide rebates if they do not meet those standards.

Who gets rebates?

• Almost one-third of consumers in the individual market will get rebates averaging $127. These are consumers who are not covered by an employer and purchase their policies directly from an insurance company.

• Average amounts will vary significantly by state. The highest will be paid to consumers in Alaska (average of $305), Maryland ($294) and Pennsylvania ($243). On the opposite side of the scale, no individual market insurers in Hawaii, Maine and Washington, D.C., expect to issue

rebates.

• Nationwide, rebates to individual consumers will total $426 million.

• In the small employer market, 146 insurance plans covering nearly 5 million workers and dependents will issue $377 million in refunds. Employers do not have to pass those on to workers. They also can opt for a discount on next year's premiums.

• In the large employer market, 125 plans covering 7.5 million workers and dependents will issue $541 million in rebates.