The Affordable Care Act brings an unprecedented level of scrutiny and transparency to health insurance rate increases. Thanks to the law, for the first time ever, insurance companies in all states cannot raise rates without accountability or transparency. 
Before the Affordable Care Act, health insurance companies in many states could raise rates with little or no scrutiny, leaving consumers in the dark.  While many state Departments of Insurance have historically reviewed proposed rate increases to determine if they are reasonable, other states lacked the legal authority to review or reject a proposed rate increase or lacked the resources necessary to effectively review rates.  The Affordable Care Act, through the Rate Review Program, ensures consumers in all states enjoy at least a minimum level of protections by ensuring that significant rate increases in all states are thoroughly analyzed and disclosed to the public.

The rate review programs complement rules in the Affordable Care Act that ensure consumers receive a good value for their health insurance premium dollar and make the insurance marketplace more transparent.  The 80/20 rule requires insurance companies to reveal how much of premium dollars they actually spend on health care and how much on profits and administrative costs such as salaries and marketing.  If insurers do not spend at least 80 percent of premium dollars on actual health care benefits and quality improvement measures, they must refund consumers the difference.

Based on initial findings, the Rate Review Program and the 80/20 rule are helping to slow premium growth and have resulted in real savings to consumers across the country.[1]

  • To date, Americans have saved an estimated $1 billion on their health insurance premiums thanks to rate review.  State-based Rate Review Programs were created or strengthened by the health care law.
  • Additionally, 13 million Americans have benefitted from $1.1 billion in rebates made possible by the 80/20 rule.
  • By holding insurance companies accountable, rate review and the Affordable Care Act’s Medical Loss Ratio policy (or 80/20 rule) have yielded an estimated $2.1 billion in savings to consumers in one year. 

Disclosing proposed increases sheds light on industry pricing practices that many experts believe have led to unnecessarily high premium prices.  This transparency in the health insurance market helps to promote competition, encourage insurers to work towards controlling health care costs, and discourage insurers from charging unjustified premiums. 

The Affordable Care Act brings an unprecedented level of scrutiny and transparency to health insurance rate increases. Thanks to the law, for the first time ever, insurance companies in all states cannot raise rates without accountability or transparency. 
Before the Affordable Care Act, health insurance companies in many states could raise rates with little or no scrutiny, leaving consumers in the dark.  While many state Departments of Insurance have historically reviewed proposed rate increases to determine if they are reasonable, other states lacked the legal authority to review or reject a proposed rate increase or lacked the resources necessary to effectively review rates.  The Affordable Care Act, through the Rate Review Program, ensures consumers in all states enjoy at least a minimum level of protections by ensuring that significant rate increases in all states are thoroughly analyzed and disclosed to the public.

The rate review programs complement rules in the Affordable Care Act that ensure consumers receive a good value for their health insurance premium dollar and make the insurance marketplace more transparent.  The 80/20 rule requires insurance companies to reveal how much of premium dollars they actually spend on health care and how much on profits and administrative costs such as salaries and marketing.  If insurers do not spend at least 80 percent of premium dollars on actual health care benefits and quality improvement measures, they must refund consumers the difference.

Based on initial findings, the Rate Review Program and the 80/20 rule are helping to slow premium growth and have resulted in real savings to consumers across the country.[1]

  • To date, Americans have saved an estimated $1 billion on their health insurance premiums thanks to rate review.  State-based Rate Review Programs were created or strengthened by the health care law.
  • Additionally, 13 million Americans have benefitted from $1.1 billion in rebates made possible by the 80/20 rule.
  • By holding insurance companies accountable, rate review and the Affordable Care Act’s Medical Loss Ratio policy (or 80/20 rule) have yielded an estimated $2.1 billion in savings to consumers in one year. 

Disclosing proposed increases sheds light on industry pricing practices that many experts believe have led to unnecessarily high premium prices.  This transparency in the health insurance market helps to promote competition, encourage insurers to work towards controlling health care costs, and discourage insurers from charging unjustified premiums.