ACA Loss Ratio Rules Hurt Anti-Fraud Effort, Insurers Say

Law360, New York (July 09, 2012, 4:02 PM ET) -- Health insurers' anti-fraud efforts — including combating Medicare and Medicaid fraud — are hampered by rules under the Patient Protection and Affordable Care Act that cap spending on items not directly related to medical services, an industry group told lawmakers on Monday.

Under the ACA's so-called medical loss ratio, insurers of individuals and small businesses must spend at least 80 percent of premiums on therapeutic care and quality improvement measures. For large group plans, the figure climbs to 85 percent.

However, fraud prevention activities are excluded...
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