Rebate Checks for Premera Individual Plan Members | Producer (2024)

FAQs

Why did Premera send me a check? ›

But why? These rebates are thanks to the Medical Loss Ratio (MLR) provision in the Affordable Care Act. It requires health insurance carriers to refund members part of premiums received if they do not spend the required percentage on health care services, such as doctor and hospital bills.

Rebate Payment Logistics

Rebates or rebate notices are mailed out by the end of September and the federal government will post a summary of the total amount owed by each issuer in each state later in the year. Insurers in the individual market may either issue rebates in the form of a check or premium credit.

The MLR rules for individual and group health insurance took effect in 2011. The first rebate checks were issued in the fall of 2012.

In general, rebates are taxable if you pay health insurance premiums with pre-tax dollars or you received tax benefits by deducting premiums you paid on your tax return. Talk with your tax preparer to determine if you need to report your rebate as income when you file your next tax return.

Some insurance companies pay the subscriber directly when the provider is not in network. There are several things you can do with the check. You can deposit it and pay for the care with a personal check or credit or debit card.

Checks can be used to make bill payments, as gifts, or to transfer sums between two people or entities. They are generally seen as a more secure way of transferring money than cash, especially with large sums.

Once you receive an MLR rebate check, the clock is ticking. If you haven't taken steps to use it within three months, the portion that is a plan asset must be held in trust.

Rebates are an incentive program in which a supplier offers their customers a monetary reward for reaching designated purchasing goals. After the target specified in the agreement is met, customers can claim a percentage of the purchase price back for a better deal on their order.

In the insurance business, rebating is a practice whereby something of value is given to sell the policy that is not provided for in the policy itself. An example of rebating is when the prospective insurance buyer receives a refund of all or part of the commission for the insurance sale.

Taxes 2023: IRS says California, most state tax rebates aren't considered taxable income - CBS News.

Can an employer keep a MLR rebate? ›

So, for example, if plan participants contribute 30% of the premium, then 30% of the rebate must be used for the benefit of plan participants. Employers may keep the portion of the rebate that relates to employer contributions; the employer portion of the rebate is simply returned to the employer's general assets.

Both rulings highlight a fundamental principle: rebates that effectively reduce the purchase price of a product or service are not to be treated as taxable income. For taxpayers, this means that such rebates lower the out-of-pocket costs for certain purchases without increasing their tax liabilities.

Under the settlement agreement, which resolves the lawsuit with no admission of liability, Premera will pay $32 million to a fund that will pay the costs of recovery to class members, attorney's fees, and costs.

Premera Blue Cross is a not-for-profit Blue Cross Blue Shield licensed healthcare company that offers health plans in Washington state and Alaska.

Return completed form and all attachments to Premera Blue Cross, PO Box 91059, Seattle, WA 98111-9159. You may submit electronically through a secure email box by signing in to your secure account at premera.com. If you have any questions, call the customer service number on the back of your member ID card.

With an HSA plan, preventive services are covered in full. That means there is no out-of-pocket cost to you for qualified preventive services, screenings, and certain generic prescriptions. You pay the full cost for nonpreventive care and prescriptions until you reach your plan-year deductible.