"There are two Affordable Care Acts. There's the legislation passed by Congress in 2009, and then there's the mythical Affordable Care Act – the perfidious 'government takeover' decried and demagogued by so many conservatives (and quite a few liberals). The former is quite popular, the latter gets decidedly mixed reviews."
How the Senate Health Care Bill Would Eliminate High-End Plans
"By establishing both an excise tax on high-value health plans and a minimum MLR, the bill creates an implicit maximum legal premium that insurers can charge. With an 85 percent MLR and a 40 percent excise tax on the 'excess' premiums, simple algebra shows that if the premium exceeds 1.6 times the taxable threshold, then it is impossible for insurers to both meet the required medical loss ratio and pay the excise tax.
This implies a maximum legal premium of $13,600 for single policies, assuming an $8,500 threshold. At that level, the premium would be entirely consumed by claims and the excise tax, leaving the insurer no funds to pay other taxes or administrative costs, let alone profit."
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