The medical loss ratio (MLR) is the most important aspect of healthcare reform. This interpretation of this law is going to determine if the private industry stays in business. The one positive thing is the NAIC is in charge of interpreting the MLR.

The National Association of Insurance Commissioners was charged by Congress with considerable implementation responsibilities relative to PPACA, and NAHU continues to work with state regulators and the NAIC on a weekly basis on implementation issues of concern to health insurance agents and brokers. The primary issue the NAIC is currently working on of key interest to NAHU and its members is the crafting of definitions relative to what health insurance services will be covered by the PPACA’s minimum loss ratio (MLR) requirements.  

The law gives the NAIC until December 31 to craft the MLR definitions, but HHS has requested that the NAIC complete its work early so that necessary regulations relative to MLR implementation can also be developed. HHS originally asked that the NAIC complete its work by June 1, but the NAIC rejected the timetable, stating it was too tight. Initially, the NAIC said they hoped to get their final work product to HHS by the end of July. However, during a conference call yesterday, Commissioner Steve Ostlund, chair of the NAIC’s Accident and Health Working Group, which is the primary committee within the NAIC working on the definitions, backed away from the end-of-July timeframe. While he was clear that the group will finish its work well in advance of December 31, he refused to specify exactly when they will finish. 

The NAIC committees addressing this issue meet via conference call on at least a weekly basis, and the group is holding an interim meeting on the MLR issue in Washington the week of July 18. The NAIC will also hold their regularly scheduled meeting in Seattle from August 14-17, and NAHU will continue to be an active participant in all of these calls and meetings. Our most recent letter to the NAIC on the MLR issue was sent in conjunction with the entire Agent/Broker Alliance and can be found here.

In addition to the MLR issue, the NAIC is also charged with crafting a sample of the notice all health insurers must send to customers by March 2012 outlining plan benefits and costs. The goal of the NAIC committee is to translate complicated insurance-related terms and benefit information into summaries that can be easily digested by consumers. PPACA required the NAIC committee to be made up of not just insurance regulators, but also interested parties like insurers and consumer groups. NAHU CEO Janet Trautwein was appointed by the NAIC as one of the statutory working group’s formal members to represent the interests of health insurance agents and brokers.

The law gives the NAIC group until March 2011 to craft their sample forms, and the committee has begun meeting on a biweekly basis to accomplish that task. As with the MLR definitions, HHS has requested that the committee finish its work early—by the fall of 2010. NAHU will keep you apprised of the committee’s progress on the sample notices via future editions of Washington Update.