Reports are that some the biggest American health insurers are now busy changing their accounting practices mainly to try and book the administrative costs as medical costs with the aim to try and cope up with all the industry reforms that are expected once the healthcare law is completely implemented.

It is no secret that the expenditure of insurers would rise a lot once the law is put into practice, and the companies are therefore trying their very best to try and tackle all the costs, which could hurt them quite a lot, especially since the industry just recently managed to shake off all the recession effects.

Under the new healthcare law, which was passed in March, insurers are required to adjust their spending habits in order to meet the new requirements, say for example, large group plans need to spend a minimum of 85 cents of every premium Dollar which is paid to them on actual medical care instead of administrative costs, and individual and small groups, on the other hand, must spend 80 cents in all of a Dollar.

"The insurance industry is beginning to consider the financial impact of the new federally required (medical) loss ratio requirements, including questionable changes in their accounting practices", said the Democratic-led Senate Committee on Commerce, Science and Transportation.

As of now, insurers end up sending less than what they would be shelling out once the bill is completely implemented and we think it a smart thing that the companies have already started adjusting their costs accordingly.

There is, however, one little downside to it. Insurers are currently working by estimates which could later end up hurting them. This should be kept in mind by them while calculating.