This latest rebate is part of the Baker Administrations cost containment initiatives
The Massachusetts Division of Insurance announced this week that through its latest cost containment efforts it will be rebating individual consumers as well as small group employers approximately $3.4 million. The rebates will come from two of the state’s health insurers.
These rebates demonstrate our commitment to protect consumers,” said Division of Insurance Commissioner Daniel Judson. “We’re seeing more claims being covered and in cases where consumers have paid more than their share, they’re getting a refund.”
Exact amounts of the rebates to be doled out will be based upon the carrier and plan that a business or individual purchased. The $3.4 million amount was determined by the Division in conjunction with the insurance carriers and were calculated as of July 31st.
According to the Division, the rebates reflect a portion of the difference between the premium charged and the actual expenditures on healthcare costs by an insurance carrier in 2014. Under Massachusetts law, health insurance carriers must spend at least 89 percent of the dollars they collect from premiums on medical costs. Those insurers that spend less than this amount must rebate a proportional amount back to the policyholder, albeit an individual or a small employer policy holder. The rebate amount for 2014 is lower than prior years due to the fact that almost every carrier this year paid out more than 89 cents of every premium dollar on health care claims.
As for 2014 rebates, the two carriers paying rebates this year are Tufts Associated HMO and BMC Healthnet Plan. Those individuals who purchase their own health insurance as well as those employers who purchase in the small group market are eligible to receive payments. The rebates will either be paid directly or credited towards the cost of future premiums.
“Our agencies work to protect consumers, and I’m proud of the work the Division of Insurance has done to secure these rebates for consumers and small businesses,” said Undersecretary of Consumer Affairs and Business Regulation John Chapman. “With national health care costs on the rise it’s critical for the Division of Insurance to make sure Massachusetts small businesses and consumers are getting their money’s worth.”
