Regence to send out rebates

1,600 Clark County members to receive checks averaging $499

By Marissa Harshman, Columbian health reporter

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Hundreds of Clark County residents will receive a welcome surprise in their mailboxes next week.

On Monday, Regence BlueCross BlueShield of Oregon is sending rebate checks averaging $499 to 1,600 of its Clark County members, said Regence spokeswoman Rachelle Cunningham.

Clark County residents who purchase an individual plan from Regence can expect a rebate check worth 8 percent of the total amount they paid in premiums in 2012. The checks will be issued to the policyholder.

The rebates will not be sent to Medicare clients or Regence members who are on group health plans, such as employer-provided plans.

The reason for the rebate checks is a new rule implemented by the Affordable Care Act.

Since 2011, the Affordable Care Act has required health insurers to spend at least 80 percent of premiums paid for individual plans on health care services, such as doctor visits, tests and scans, medication, equipment and hospital bills. No more than 20 percent can be spent on administrative costs.

In Clark County, Regence spent only 72 percent of premiums on health services in 2012. As a result, the federal law requires Regence to issue the rebates by Aug. 1.

The Affordable Care Act has similar requirements for large- and small-group plans. Health care costs must make up at least 80 percent of small-group plan premiums and 85 percent of large-group plan premiums under the Affordable Care Act.

Regence met the thresholds for its small- and large-group plans in Oregon and Washington. It also met the threshold for individual plans elsewhere in Oregon and Washington. Clark County was the only exception, Cunningham said.

"Regence carefully calculates expected claims costs for each pool, with a goal of setting premium that just covers claims and cost of administering plans, in keeping with our nonprofit values," Cunningham said in an email to The Columbian. "Natural fluctuations in demand can result in fewer claims than projected."

For more information on Affordable Care Act rule, visit www.hhs.gov/healthcare/insurance/premiums/value.html.