Health insurance premiums should go for actual medical care -- not insurers' overhead and profits -- the Obama administration said Monday in rules that for the first time require the companies to give consumers a rebate.
The regulation unveiled by the Health and Human Services Department calls for insurance companies to spend at least 80 cents of the premium dollar on medical care and quality. For employer plans covering more than 50 people, the requirement is 85 cents. Insurers that fall short of the mark will have to issue their customers a rebate.
Part of the new health care law, the rule is meant to give consumers a better deal. Administration officials said it will prevent insurers from wasting valuable premiums on administration, marketing and executive bonuses. "While some level of overhead costs is certainly necessary, we believe they have gotten out of hand," said Health and Human Services Secretary Kathleen Sebelius.
Some lefties will ask me why I would disagree with such a rule. What I think of the rule is irrelevant; what's relevant is the further injection of the federal government into the marketplace, and the power we allow the federal government to usurp from the states and the people (see the 9th and 10th Amendments). I fear the federal government with its firearms and prisons much more than I fear an insurance company.