HUGE? NAIC Task Force Votes in Favor of Brokers

[Yagents]

If it's us vs. Obama's bully pulpit, we LOSE

Still, the pending legislation — H.R. 1206, the Professional Health Insurance Advisors Act of 2011, introduced by Rep. Mike Rogers (R-Mich.) — isn't likely to pass, according to Citigroup Global Markets analyst Carl McDonald. The Obama administration wants to put out news releases showing the amounts of rebates, he told attendees at a June 23 AIS webinar on the MLR rules. And the benefits from exempting broker pay in MLR calculations would go mainly to the "bottom line of insurers," something it doesn't want to see.
Consumer Groups Slam NAIC Vote for Brokers | AIS Health

 

[stuy119]

Scratch that:

PPACA: NAIC Ices Agent Comp MLR Exclusion Effort - Regulatory,Legislative and Tax Issues - Life and Health Insurance News

The National Association of Insurance Commissioners (NAIC) has backed away from the idea of supporting a congressional bill that could exclude insurance agent compensation from medical loss ratio (MLR) calculations.

The NAIC, Kansas City, Mo., considered a proposal to support the bill, H.R. 1206, todayduring a plenary conference call.

The plenary is an assembly that includes all voting members of the NAIC.

California Insurance Commissioner Dave Jones and several other commissioners expressed opposition to the H.R. 1206 support proposal.

Jones asked Kevin McCarty – the Florida insurance commissioner and the head of a task force that approved the H.R. 1206 support proposal – whether the task force vote represents NAIC policy. McCarty, the NAIC president-elect, said it does not.

McCarty and other H.R. 1206 supporters ended up not pursuing a plenary vote.

 

[Dave020]

This is why I voted for Bronstein.

 

[Yagents]

What the hell does this mean? Is this a huge setback?

McCarty and other H.R. 1206 supporters ended up not pursuing a plenary vote.

 

[Dave020]

What the hell does this mean? Is this a huge setback?

McCarty and other H.R. 1206 supporters ended up not pursuing a plenary vote.

Yes it is a huge setback considering the resolution had some steam last week. This means NAIC will not even consider removing agent comp from the MLR.

 

[pahealthquotes]

what a cluster phuck.. unreal

 

[Yagents]

I'm startin' to think this is a blessing in disguise, and goes in the category of "be careful what you ask for". If commish was removed from MLR, things would not get better:

1. Ins Co's profits would go up b/c they keep more of the 20%, they definitely wouldn't lower premiums

2. Our commish would then be paid out separate from the premium, meaning more transparency and cost to the consumer. Vs being buried now.

3. Who would set the commish rate? it could be a race to the bottom if agents are bidding against each other. I would rather let the insurance companies compete for our business by eliminating waste, and realizing we are a more efficient distribution force, and keep commish the same or higher than now.
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UPDATE from NAIC and NAHU:

http://images.magnetmail.net/images/clients/NAHU_2/attach/floir.pdf

Dear NAHU Members,
I just wanted to update all of you about the National Association of Insurance Commissioners (NAIC) activity that occurred yesterday regarding the MLR issue. As Florida Insurance Commissioner Kevin McCarty said in a statement issued yesterday, "There have been some inaccurate statements reported in the press regarding the NAIC's Executive Committee meeting." Some of our members have understandably expressed concern to us about the confusing news stories they have seen, so we want to make sure our entire membership has heard the facts of the matter.
As we mentioned in Monday's Washington Update, the NAIC held a plenary committee call yesterday afternoon. The Plenary Committee is comprised of all of the commissioners and chaired by NAIC President and Iowa Insurance Commissioner Susan Voss. The committee held scheduled votes on several items, and it also heard a scheduled REPORT from Commissioner McCarty on the activities of the Professional Health Insurance Advisors Task Force's recent endorsement of H.R. 1206, the bipartisan federal bill to remove agent and broker compensation from the MLR calculation. The Plenary Committee was never scheduled to vote on the endorsement yesterday, and so no vote was ever called. Please keep in mind that just because no vote was planned for yesterday that does not mean that there will not be further NAIC action on this issue in the future.
Also, much has been made by a question posed by the California commissioner to Commissioner McCarty during the call about whether or not the Task Force's vote meant that the entire NAIC endorsed H.R. 1206. Commissioner McCarty answered that question honestly by saying, no it does not. The task force doesn't speak for the NAIC as a whole, but its policy endorsement is a very significant step.
As Commissioner McCarty noted on the call, potential options for future NAIC action include consideration by the NAIC'S Government Relations (EX) Leadership Council (GRLC), which does has the ability to make legislative endorsements for the whole organization, or sending the matter to the NAIC's plenary committee, so that all commissioners may vote. It is up to the NAIC's Executive Committee to decide which path the NAIC will take. The NAIC as a whole almost never endorses federal legislation, particularly controversial health policy legislation. Their leadership is trying to figure out the best way to handle this within their own committee structure and they do not want to rush the process. We at NAHU respect and appreciate that position.
Like NAHU, in addition to considering federal legislation, the NAIC also publicly committed to working with HHS on a parallel track to address the agent/broker compensation issue on a regulatory basis. The NAIC's ongoing efforts in this area were discussed at length on yesterday's call. Many commissioners feel that the fastest path to MLR relief rests with HHS, both since the secretary has a great deal of statutory authority over PPACA implementation and since the current Congress hasn't been quick to pass legislation lately on any matter. NAHU agrees. That is why we have asked Secretary Sebelius to either amend the current interim final rule interpreting the MLR requirement to properly classify agent and broker commissions as pass-through amounts and to exclude them from the overall MLR calculation, or issue an immediate hold on implementation and enforcement until these matters can be resolved by HHS and the states and/or Congress. That's also why we truly appreciate the NAIC's efforts to encourage an immediate regulatory solution through HHS.
What happened yesterday at the NAIC wasn't a surprise, nor was it an unwelcome development. The insurance commissioners continue to work towards a resolution of this critical issue, as does NAHU, our fellow agent organizations and other coalition partners. Our efforts on the Hill and with HHS remain as steadfast as ever. We ask that all of our members keep up outreach with state insurance regulators, so that they will continue to support the valuable role that health insurance agents and brokers play in the private health insurance marketplace. We also strongly encourage all members to ask your lawmakers to join on to H.R. 1206. We now have more than 100 co-sponsors thanks to your hard work, but we are always looking for more!
If you have any questions about our government relations activities, or need more information, please do not hesitate to contact us.

 

[Yagents]

I found our biggest fan in this video. She mentions inevitable demise of the agent, and MLR consumer rebates vs agent commissions. 5 minutes of joy awaits you:
Medical Loss Ratio: What Does It Mean For Consumers And Brokers? - Kaiser Health News

 

[pahealthquotes]

Florida Office of Insurance Regulation Statement:​

There have been some inaccurate statements reported in the press regarding the NAIC's Executive
Committee meeting today. No vote was scheduled for the support of the Rogers' bill, therefore, there
was no delay in taking a vote as reported by some news outlets. Commissioner McCarty has not
changed his position, and continues to support the bill sponsored by Mike Rogers, which would remove
sales agents' fees from the administrative costs of insurers for calculation of the medical loss ratio
(MLR).
In the meeting today, the Commissioner offered his report on the task force's support for the Rogers'
bill, and also reported that the task force is continuing to work with all interested parties and HHS to
evaluate the possibility of a compromise that would result in a more timely result than pursuing a
change in the MLR. Commissioner McCarty continues to support the underlying purpose of the Rogers'​

bill, which is to maintain the role of agents, and fair compensation for health insurance agents.

 

[Yagents]

Looks like the squeaky wheel got oiled....check

Politico Pro: Broker Bill Fades For NAIC
It's looking less likely that the National Association of Insurance Commissioners will endorse legislation pulling brokers' commissions out of the medical loss ratio formula, according to those watching the issue closely. The group's executive committee last month decided to put off further action on whether to endorse a bill from Reps. Mike Rogers (R-Mich.) and John Barrow (D-Ga.) to remove broker fees from the MLR calculation for administrative expenses. And before this week's NAIC conference was canceled because of Hurricane Irene, those deeply involved in the broker issue were only expecting the MLR issue to come up in passing — a far different attitude than the insurance commissioners" March meeting. A spokeswoman for Florida Insurance Commissioner Kevin McCarty, chairman of the NAIC's Professional Health Insurance Advisors Task Force and one of the broker bill's biggest advocates, said no major action was planned for the conference (Millman, 8/29).

GAO: Health Law's MLR Provision Will Negatively Affect Insurance Broker Commissions.

The Hill (8/30, Baker) "Healthwatch" blog reports that although a "controversial piece" of the health-reform law is starting to "save consumers money," medical-loss-ratio (MLR) provision could potentially leave the public "fewer plans" form which to choose, according to a Government Accountability Office report released Monday. Moreover, although consumer advocates argued that the projected impact of MLR has been "overstated," the GAO report "seems to support" insurance agents and brokers warnings that the provision "will hurt them." Brokers are concerned insurance companies "will cut commissions and redirect that money toward their own bottom lines"; and the GAO "said 'almost all' of the insurers it interviewed are cutting commissions."