Q: How will the new healthcare reform law affect health insurance companies?

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Answer:

The law substantially impacts health insurers. Some of the effects include:

- Changes to the way insurance plans do business: Insurers are now required to offer health insurance plans to individuals and small groups on a community-rated basis. The law states that they cannot exclude individuals with pre-existing conditions.

- Requirements to meet financial standards: For large health groups and Medicare, the law requires that insurers spend at least 85 percent of the premiums they receive from customers on medical care, not salaries and company expenses. For small groups and individuals, the law requires that health insurance companies spend 80 percent of the premiums they receive on medical care. This limits the insurance companies’ abilities to earn profits.

- Changes in regulations: The health insurance exchanges impose requirements on insurers to meet specific standards and rates for their customers. Insurance companies will have to comply with these new rules.

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Meet the experts to answer the commonly asked questions to help you understand the Health Care Exchange

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Linda V. Tiano

Member of the Firm at Epstein, Becker, and Green in Washington, DC and New York

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David Randall

Senior Vice President of Strategic Planning and Business Development at the University of Alabama at Birmingham Health System.

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Marti Lolli

Director of Health Care Reform at Priority Health in Michigan.

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