Rebates are coming to millions of Americans as the result of new requirement in the federal health care overhaul.
Although the payout will amount to only $160 per person it is a way to establish oversight within the insurance industry.
Here’s how the new system works: Starting in 2011, insurers were supposed to abide by the new rules. They require insurers in the individual and small group market to keep administrative costs to 20 percent, and to just 15 percent in the large group market. If they don’t, they’re supposed to send out a round of rebates by Aug. 1 of this year. That rebate could take the form of a check or credit card payment, or a reduction in premiums — the rebates will either be distributed to individuals or employers depending on the plan.
Some companies will inevitably comply with the rule, and in turn not be required to pay out rebates. Those that don’t are supposed to report to the federal government by June with their rebate plans.
