In brief: The federal government has rejected a waiver request by the State of Texas to be excluded from the new law limited health insurance profits.
The full story
The law, which began this year as part of the Affordability Care Act, requires insurance companies to spend no less than 80% of their revenue on providing health care or health improvement programs including payouts and no more than 20% on overhead and salaries.
Companies who, at the end of the year, have collected more than paid out are required to issue refunds to their policy holders.
Texas claims that their insurance market will be destabilized by the new law and is part of a lawsuit now in the Supreme Court contesting the Affordability Act as unconstitutional. Despite this, the federal government denied the request for a waiver from the rules for the year, forcing Texas to comply or be in violation of federal law.
Summing up
Texas is the ninth state requesting a waiver that has been denied.
Photo credits: Stock
