Massachusetts Health Insurance Companies Pay Up for Missing Benchmark
Massachusetts health insurance plans will have to give some 57-million dollars in rebates to customers. State officials announced today the rebates will be delivered to some 50,000 small businesses and another 50,000 residents who buy their insurance on the individual market.
The health plan rebates will come from the Tufts, Harvard Pilgrim, Fallon, and Neighborhood Health Insurance companies. On average, individuals will receive just over $200 and business will receive $936.
Undersecretary of Consumer Affairs Barbara Anthony says the the health plans spent too much on administrative costs, instead of medical care.
"The Legislature said in 2010 that insurance companies had to spend 88 cents of every premium dollar on our health care. And what happened is there were some carriers – I think there were 4 of them - that missed the mark, and they spent less than 88 cents on the dollar for health care costs.”
Insurers say they failed to meet the benchmarks because people visited doctors less than expected in 2011, in response to the slow economy.