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<\/a><\/p>\nBy: James LaCorte<\/p>\n
Where does my health insurance premium<\/a> really go? Health insurance customers often ask a simple question about the premium they pay every month:<\/p>\n Where does my premium dollar go? They\u2019re usually not asking for a quick tutorial on how insurance works: Most people understand that everyone pays into a pool, and only those who need medical care take money out in the form of health care claims. What many of these folks really are asking is how much of that money actually pays for health care and how much goes toward running an insurance<\/a> company \u2014 or toward profits.\u00a0 <\/span>Fair question.\u00a0 <\/span>Blue Cross and Blue Shield of North Carolina<\/a> (BCBSNC) paid $5 billion in claims in 2013. Recently we announced that we spent almost 86 cents of every premium dollar paying for our customers\u2019 health care \u2013 doctor visits, surgery, tests, medicine, eyeglasses, etc.<\/p>\n Our non-medical spending largely goes toward customer service and technology. We are also a full-taxed company. In 2013, we paid out more than $100 million in local, state and federal taxes.<\/p>\n The medical loss ratio requirement (MLR), created by the Affordable Care Ac<\/a>t in 2010, is aimed at preventing insurance companies from spending excessively on administration (including salaries) and other routine business costs. It requires insurance companies to use 80 cents out of every premium dollar from individual and small group customers to pay customer claims and support activities that improve the quality of care. (The requirement is 85 cents for large group customers.) BCBSNC<\/a> has exceeded that standard for years, even before it was the law. In 2012, BCBSNC paid $260 million more toward health care expenses than was required by the federal government. We don\u2019t have the dollar figure for 2013 yet, but we anticipate that it will be similar.<\/p>\n The MLR requirement means that health insurers<\/a> can\u2019t just increase rates as a way to increase profits. If our spending on medical care falls below those minimum percentages, then we are required to refund the extra money to our customers. Some of our competitors have been forced to do that.<\/p>\n We know it\u2019s frustrating to pay a lot for health insurance<\/a>: We also know we must to do our part to rein in our own expenses. Believe me, we don\u2019t like selling a product that can be difficult to afford. We think the best way to work toward more affordable health insurance is to keep our focus on where the majority of the money goes \u2013 health care expenses. That\u2019s why we work every day to build new collaborations with hospitals and doctors who share our goal of providing top quality health care as efficiently as possible.<\/p>\n Gerald Petkau- Chief Financial Officer, BCBSNC<\/p>\n For more information on health insurance coverage in North Carolina<\/a>, please visit our website at www.nchealthplans.com<\/a> or call our toll free number 888-765-5400 and speak with one of our professional agents. Our agency provides coverage for health insurance in North Carolina through Blue Cross Blue Shield of North Carolina (BCBSNC). <\/a>It would be our pleasure to help you navigate through the Health Care Reform<\/a> changes in accordance with the new regulations of Obama care<\/a>. Call us for details.<\/p>\n","protected":false},"excerpt":{"rendered":" Posted April 14, 2014 – Blue Cross Blue Shield- Health Care Reform Blog By: James LaCorte Where does my health insurance premium really go? Health insurance customers often ask a simple question about the premium they pay every month: Where does my premium dollar go? They\u2019re usually not asking for a quick tutorial on how […]<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[560,14],"tags":[525,23,405,554],"class_list":["post-4497","post","type-post","status-publish","format-standard","hentry","category-affordable-care-act-aca","category-bcbsnc-insurance","tag-affordable-care-act","tag-bcbsnc","tag-health-insurance-premiums","tag-premiums"],"_links":{"self":[{"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/posts\/4497","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/comments?post=4497"}],"version-history":[{"count":3,"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/posts\/4497\/revisions"}],"predecessor-version":[{"id":4501,"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/posts\/4497\/revisions\/4501"}],"wp:attachment":[{"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/media?parent=4497"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/categories?post=4497"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nchealthplans.com\/news\/wp-json\/wp\/v2\/tags?post=4497"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}