The Patient Protection and Affordable Care Act saved consumers nearly $4 billion on their insurance premiums in 2012, the Obama administration said Thursday.
The Department of Health and Human Services said that nearly 80 million consumers saved $3.4 billion up front on their premiums as "insurance companies operated more efficiently." Consumers also received $500 million in rebates from insurers that did not meet the new standards under the law.
That savings is due mainly to the medical loss ratio rule, a rule that requires insurance companies to spend 80 percent or 85 percent of their premiums on medical costs, leaving only the remaining 15 percent or 20 percent for profit and administrative expenses. The rule went into effect in 2011.
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