Yes it’s true, starting next year rebate checks will be in the mail. Federal regulations issued on Nov. 22 2010 called the “Affordable care act” required health insurance companies to prove that they spent at least 80% of their collected dollars on medical care and improvement efforts.These regulations force the health insurance marketplace to become more accountable and require that they spend more of their dollars on higher end care. This means that Americans are going to get a better value for all of their hard earned money spent on health care insurance.Basically what these companies are doing with a large part of our consumer dollars is spending it on marketing, exec salaries, overhead and essentially just putting it their pocket. With the Affordable Care Act insurance companies will be required to spend 80 to 85% on actual medical care and quality health care improvement, instead of “administrative costs.”If they fail to comply, these insurance companies will have to provide a rebate check starting in 2012. These new rules will protect millions of Americans and some estimates are projecting that almost 9 million Americans will be eligible for rebate checks in 2012 with a value of almost 1.4 million dollars. The average rebate check will be around $164.This federal regulation is requiring that insurance companies must publicly report how much they are spending on premium medical care, which is great information for all those consumers left in the dark for all these years. After years of input from the different states, public and stakeholders the decision has been made to make health insurance more of a fair process for consumers.This act also requires the (NAIC) National Association of Insurance Commissioners to create uniform procedures and policies in calculating their medical loss ratio’s, which is essentially how much is spent where and what part is being spent on quality medical care for the consumer and if it’s not 80-85% the insurance companies will have to issue a rebate check for the difference.Insurance companies in every state will now be responsible and held financially accountable in protecting the interests of the general public, policy holders and enrolled participants in their respective states.It’s outrageous that in some markets insurance companies spend as little as 60% on direct medical care and health care improvement. As much as 40 cents out of every dollar goes to the “administrative costs” of the health care insurance provider. So where does all this money really go you may wonder?Timothy Jost who is a law professor at Washington and Lee University in VA says he estimates that these insurance companies spend 12% of every dollar that they get on pharmaceuticals and 31% for doctor’s care, and 31% on administrative costs.Hopefully this new regulation will force insurance companies to become more efficient and not raise premiums more than absolutely necessary and if they do then 80-85% of every dollar needs to be on actual care and not into the endless coffers of the insurance companies.
Commercial Bank Loans In Credit Crisis
Commercial bank loans, aka conventional loans, though “beat up” are still available. Yes, pretty much every component of underwriting has tightened, i.e. loan to value, debt coverage ratio, global cash flow, borrower experience, etc but many decent (not perfect) commercial loan requests can qualify and enjoy the benefits. Like low, long term fixed rates, longer amortization schedules and the lowest fees in the business.First of all, what do we mean by commercial bank loans? We’re referring to conventional loans that are funded by banks and are often held onto by the bank. Further these loans are not backed by any type of governmental support, like B and I or SBA loans are. So, because the banks fund and often hold onto the debt, they want to make sure they are decent deals.Commercial Bank LoansWe get a lot of people that contact us with the mind set, “assuming you can’t help me, but thought I’d call anyway.” The key areas that borrowers need to keep in mind is that banks are mostly concerned with the cash flow of their business and what the borrower looks like on a personal cash flow level. This is referred to as Global Income.One solution for many borrowers, that have not already filed their tax returns, is to simply tell their accounts to show as much income as possible. This often can be the cure that borrowers need to better qualify for these superior loans.Also, borrowers need to do a “180″ on their attitude towards banks. Meaning, many banks are now in worse condition than many borrowers. They have cash flow and liquidity issues themselves. In fact, 80% of all commercial banks are pretty much on the sidelines. So just because you get turned down cold by a few banks does NOT mean you can’t find one that is healthy and has a real appetite for your type of loan request.As far as the benefits, borrowers can currently expect low rates in the 6%’s, with amortization schedules from 25 to 30 years. Also, fixed rates on conventional loans can still go up to 10 years, though 7 and 5 years is more common. Further when compared to loans backed by the SBA or USDA loans that have fees of 2 -3% these are very inexpensive with normally only 1%.Though commercial bank loans many have lower loan to value requirements, and increased general underwriting standards they are well worth the effort.