By Sam Baker - 06/20/13 03:24 PM EDT
“The healthcare law is providing consumers value for their premium dollars and ensuring the money they pay every month to insurance companies goes toward patient care,” HHS Secretary Kathleen SebeliusKathleen SebeliusRomney: Trump victory 'very possible' Fighting for assisted living facilities The chaotic fight for ObamaCare MORE said in a statement.
The health law requires insurance plans to spend 80 or 85 percent of their premiums on medical costs, leaving only the remaining 15 or 20 percent for profit and administrative expenses. They must pay a rebate if they miss the threshold.
Consumers saved money as insurers changed their premiums to comply with the requirement, HHS said in a report Thursday.
The new rules first took effect in 2011. That year, insurers paid out more than $1 billion in rebates. Last year saw fewer rebates and more up-front savings, according to the HHS report.
Consumers saved $3.4 billion last year as insurance companies lowered their premiums to comply with the new rules. Consumers also received $500 million in rebates from insurers that did not meet the new standards.