Colorado residents to receive $27.5 million in insurance rebates
Rebates will average $227 for 121,000 Colorado families.
U.S. Health and Human Services Secretary Kathleen Sebelius on Thursday announced that the rebates would come as a result of the Affordable Care Act's 80/20 rule. The rule requires that insurance companies spend at least 80 percent of consumers' premium dollars on medical care and quality improvement.
The remaining 20 percent can be spent on administrative costs, such as salaries, sales and advertising. Companies that do not meet this requirement must provide their customers a rebate for the difference no later than Aug. 1.
Those receiving rebates will see either a rebate check, a lump-sum reimbursement to the account used to pay premiums, reduction in future premiums or distribution of the rebate by their employer.
Consumers will receive notice from their insurance company informing them about the rule and whether the company met the standard.
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