Connecticut residents slated to get $13 million from insurers

Beginning in August, nearly 138,000 Connecticut families and individuals will receive a bonus from their health insurance company — thanks to the Affordable Care Act.

Those whose insurers spent too much on administrative cost will receive checks or reductions in premiums that average $168.

This is the result of the so-called 80/20 rule in the Affordable Care Act that prohibits health insurance companies from spending more than 20 percent of what they charge in premium on administrative costs such as salaries, marketing and executive bonuses.

“The 80/20 rule helps ensure consumers get fair value for their health care dolla,” said Secretary of Health and Human Services Kathleen Sebelius.

On June 1, 2012, insurance companies nationwide submitted medical loss ratio reports for coverage provided in 2011 to HHS.

Based on the reports, HHS determined insurance companies that didn’t meet the 80/20 rule owe nearly 12.8 million Americans more than $1.1 billion.

Companies that self-insure, however, are not bound by the 80/20 law, and their employees will not receive any checks or rebates.

Mike Hash, director of HHS’s Office of Health Reform, said a list of the insurers who were the worst offenders of the 80/20 standard is not available because his agency hasn’t processed all the information received by insurers.

The checks will be sent out unless the Supreme Court tosses out the ACA in a ruling expected next week. If the court decides the ACA is unconstitutional, the 80/20 rule will be moot.