U.S. health insurers will send out about $330 million in rebates to employers and individuals this summer under President Barack Obama's healthcare law, the U.S. Department of Health and Human Services said on Thursday.
The law, often called Obamacare, requires insurance companies to refund customers when they spend less than 80 percent or 85 percent of healthcare premiums they collect for medical care.
The rebates will go to about 6.8 million people and have a value of about $80 per family. They are to be sent by Aug. 1 either directly to consumers or to the employer providing the health coverage, who is required to pass the savings onto employees, the agency said in a report.
The total rebate figure is less than last year, when the insurers were told to send out $500 million under the law. The decline is a trend that the government said shows that more insurers are charging lower premiums than they would have if the law was not passed.
The healthcare law was passed in 2010 and the medical loss ratio, or MLR, portion of the law was first applied in full in 2011. It limits spending on administrative costs, salaries and bonuses. Other portions of the law went into effect this year, including the creation of exchanges to sell insurance to individuals as well as the expansion of Medicaid.
If insurance companies had maintained the 2011 ratio of premiums relative to the cost of medical care, consumers would have spent $3.8 billion more in additional premiums in 2013, the health agency said.
Florida will receive the most rebates in the country this year, with $41.7 million returned, it said.
(Reporting by Caroline Humer in New York; Editing by Lisa Shumaker)