Florida Gov. Rick Scott (R) tried to cheat the families of his state out of $145 million in health insurance rebates, and the Obama administration said no. By rejecting Florida's bogus attempt to be exempted from a consumer protection in the Affordable Care Act (ACA), the administration sent a clear message to health insurance companies that their days of ripping off consumers are over.
This is a big deal. Gov. Scott, a health care tycoon himself, wanted his state to get a pass on federal rules that would require insurance companies to send $145 million in premium rebates to families over the next three years. Scott's plan would hand over the money to Wall Street-run insurance companies instead of Florida's hard-working families -- a typical 1% maneuver. But they were defeated by a good law and because the U.S. Department of Health and Human Services (HHS) enforced it in a fair and reasonable way.
Consumers in Florida won today because of one of the best and possibly least known provisions in health care reform called the Medical Loss Ratio (MLR). Under this rule, health insurers that fail to spend at least 80% of your premiums on actual health services must give the difference back to consumers. Meeting this standard requires insurance companies to become more efficient, to keep less money for profits and CEO salaries and to set their rates accordingly. It says that people paying premiums should get more value for their money.
The goal is to hold insurance companies accountable by charging fair rates or paying consumer rebates.
Florida asked HHS to let insurers keep padding their premiums with administrative excess. Health Care for America Now and other consumer groups formally objected to Florida's request, pointing out that it was based on evidence assembled at a public hearing last year that was rigged by the Scott administration to exclude consumer participation. The state presented no credible evidence to back up Scott's assertion that health insurance companies would abandon the market if the request were denied.
The MLR standard is just one recent example of how the ACA is making a huge difference in the lives of America's families. This week the administration announced that 2.5 million young people gained coverage because the health care law allows young adults to remain on their parents' health insurance until age 26. Last week we learned that the law has saved 2.7 million seniors $1.5 billion on their prescription drugs and delivered preventive medical services to 24 million Medicare enrollees at no out-of-pocket cost to them. Thanks to the law, children can no longer be rejected by insurers because of pre-existing conditions, insurers must end lifetime limits on care and small businesses are receiving job-creating tax credits. These are only some of the ways the health care law is working.
These are the consumer protections and benefits the Republicans are trying to take away from consumers as part of their relentless assault on America's middle class. The GOP and their special interest campaign contributors want to put the insurance companies back in charge of our health care and let them jack up rates and deny our care whenever they please. They'd like to eliminate Medicare and Medicaid as we know them and leave children, seniors and people with disabilities to fend for themselves.
There are two clear sides in the health care wars, and when the Republicans and the insurance companies win, America's seniors and families lose. Because of the health care law, today the people scored a victory over insurance company greed.