The influence of the Patient Protection and Affordable Care Act on spending patterns is beginning to be felt by insurers, which could lead to changes in pricing in some area of the U.S.
Reducing the administrative costs that insurers were reporting was a key target of the reform act. It required insurers to focus on their medical loss ratio — insurers either had to spend at least 80 percent of premium revenue on patient care and quality improvement, or rebate the difference.
That got insurers' attention. The Robert Wood Johnson Foundation released a study that showed that, overall, insurers spent 92 percent on patient care — well above the 80 percent target.
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
