Rockefeller MLR Report & Public Comments to HHS

[TXINSURANCE]

If anyone would like to write an angry letter how 80% MLR on the individual market is absurd, here is your chance:

Request for Comments Regarding Section 2794 of the Public Health Service Act


In addition today this interesting report from Jay Rockefeller, this is almost a downright attack on Wellpoint at times, unbelievable. Either way I will save the rant, I am posting this because the data was rather interesting:

http://commerce.senate.gov/public/?a=Files.Serve&File_id=d20644bc-6ed2-4d5a-8062-138025b998ef 

 

[J.R.]

The 80% MLR isn't what concerns me the most, it's HOW IT'S CALCULATED.

I've read article after article illustrating that Carrier X is at 70%, Carrier Y is at 75%, but nobody goes into the DETAILS. It's interesting that all these requirements were put into the bill and NOW they are trying to figure out how to calculate everything. Pardon me, but how the hell did you come up with 80%/85% then. Anybody catch the Frontline show last night?

 

[TXINSURANCE]

Actually the original plan was 90% MLR. Why is no one challenging the constitutionality of the MLR? Not sure the basis, but it certainly seems rather un-American to limit only a few companies (the smaller companies will be toast in the next few years) to a few percent profit at best.

Salpro - The old MLR formula is out the window, the new formula is being written by HHS after public opinion window - which is largely for show I presume.

What is to stop them from increasing MLR to 90% later? 95%? Remember the top tax bracket under carter was 95%! Seems laughable now - but don't put anything past these people.

The real losers are the consumers. Yes the system had major problems. A national risk pool and increased subsidies on very poor could have solved a lot of these issues. You are going to see plan innovation and technology take a major hit. Agents will thin out big time - I won't even speculate on that on this post.

We can only pray the MLR gets loosened with some lobbying or funky math, although if you read this report - they are already slamming Wellpoint for re classifying costs. These people are very angry at capitalism make no mistake about it.

Where is Winter? ME had fantastic MLR percentages on this report! LOL.

 

[0b1kanobee]

I'm really not to stressed about it as I was. Realize that these corporations are the kings of fuzzy math when they want to be. Yes the government has it's own version but these companies can mathmatically and lobby over this hurdle. Your talking about a bunch of math geniuses that work for insurance companies and you will always have to have angent, at least for the next 12 to 15 years is my guess. By then, a lot of jobs will no longer be needed. Change us a coming and a lot of it will be due to technology. We are already feeling the effects of work being done by China verses in our own backyard and India with the other. If you haven't been affected by it then you have your head stuck in the sand.

 

[Winter_123]

you will always have to have angent, at least for the next 12 to 15 years is my guess. .

Or 12 to 15 months, whichever comes first.

 

[somarco]

The private sector cannot compete with the government that get's to make up their own rules and play with OPM to pay the bills.

But . . . if there is a change of power in DC, and a change in philosophy, this thing can be choked off at the source.

 

[Norwayguy]

Where is Winter? ME had fantastic MLR percentages on this report! LOL.

Yeah I saw that 95% MLR for indvidual in Maine and maybe that explains why we have no carriers in the Indvidual Market up here....Also ask any policyholder in Maine if rates are too high and they will say yes....well with Maines MLR already above federal requirements I would say we will not see any decrease in cost here in Maine.

 

[TXINSURANCE]

Your talking about a bunch of math geniuses that work for insurance companies and you will always have to have angent, at least for the next 12 to 15 years is my guess.

You may be in for a surprise later this year.

I have been on calls for 3 weeks straight and have a pretty solid picture of what is in the works for 4th quarter 2010 and 1st quarter 2011.

Yes agents will be around. The big issue is if the MLR will be loosened or what math formula will be specifically allowed. It is the difference between 4 to 6% commission and 8 to 10% (that's about tops if I had to guess based on today's data available...).

Also beware this MLR does not appear to allow for any grandfathering. Do not assume your existing block is "safe" and only new business effected. Read your carrier contracts. This is one of the biggest points our so called "lobbying" groups should be on top of.

Most allow for commission changes on existing business with a small notice. I am not in the position to mention names, you can get your contracts and skim them yourself.

At this point it is largely a waiting game to see what HHS rules. While I am optimistic, I am also REALISTIC. The head of HHS works for who? Yeah - you guessed it. The law says 80% MLR (Individual) do not think with funky math this is going to go to 70 or 75% needed to maintain large agent commission contracts, I am sorry I do not see that happening.

Waiting game. Wait and see. Adjust accordingly.

 

[Winter_123]

Yeah I saw that 95% MLR for indvidual in Maine and maybe that explains why we have no carriers in the Indvidual Market up here....

As discussed, the state drove out all the competition and then argues along with Obama that we need a public option because there is no competition.

What's wrong with that picture class?

Same two-step that will be used to continue to promote single payer and fed intervention: "We gave the insurance companies a change to reduce rates but they wanted to cherry pick.where they did business and who they did business with."

 

[djs]

Interesting article.

They work hard to point out 'For Profit' carrier medical loss ratios, but I see nothing about non-profit carriers. Why this glaring ommission?

The reclassification is on things that probably should be counted. Of course, there has been no standard on how MLR has been reported previously, so the numbers are somewhat meaningless. It will make a good soundbite in the future though, You will hear: "Insurance companies have gone from paying 75% of premiums to 85% of premiums in claims, based on the implementation of Obamacare".

Looking at what was 'reclassified', quoting the article above:

Both insurance companies and industry analysts have started recognizing that the​

implementation of the PPACA's "quality of care" expense catego​

ry will have a major impact on
the insurance industry's bottom line over the next several years. A recent announcement about
accounting changes by insurance giant WellPoint is a first indication of how for-profit insurers
will approach this issue. In the company's most recent investor call, WellPoint executives
announced that the company has started "reclassifying" certain expenses that the company had
traditionally classified as administrative expenses. This reclassification involved expenditures
on the following items:​

​

"Nurse hotline";​

​

"Health and wellness, including disease management and medical management"; and​

 "Clinical health policy."12

If health and wellness doesn't count towards MLR, then there may be a problem with the 80%/85% numbers.

The report clearly doesn't like Anthem/Wellpoint.

When will there be a taxpayer benefit ratio (TBR) imposed on the federal government spending?

Dan
- - - - - - - - - - - - - - - - - -
By the way, has anyone bothered to do a study of the coorelation between MLR and premiums? The implicaton would be that since Maine has a 95% individual MLR, that they would have the lowest premiums. Is that even close to true? Is there to many other things that muddy the water?

Dan