Health Care or Your Money Back, Part 2 - Families Usa Skip to Main Content

Health Care or Your Money Back, Part 2

By Sarah Bagge,


Two months ago we wrote about the estimated impact of an exciting new consumer protection that ensures that the money we pay for health coverage is put to good use. The final numbers are in, and nearly 13 million Americans whose insurers spent too much on non-health-related costs will be getting their money back.

This provision is a good example of how the Affordable Care Act makes health coverage both more affordable and easier to understand. Because of the health care law, health insurers must now use at least 80 percent of their earnings from premiums for actual medical care or quality improvements and spend 20 percent or less on administrative costs like marketing and salaries. Insurers that don’t follow the 80/20 rule have to return the money, in the form of a rebate, to the families and employers who bought their insurance.

The first rebates are being issued this summer and add up to more than a billion dollars. The 12.8 million Americans in underperforming plans will receive an average of $151 per household. In some states average rebates will be much higher. Check out what consumers in your state will be getting back.

In addition, all consumers with health coverage will receive a letter explaining the 80/20 rule and how their health plan performed in the past year. Thanks to the Affordable Care Act, all consumers can make sure they are getting good value for their money when they buy health coverage.