Love it or hate it, the Affordable Care Act has sparked a great deal of debate within the health care industry. One section of the Patient Protection and Affordable Care Act (PPACA) that has proven to be particularly problematic is a provision establishing Medical Loss Ratio (MLR) benchmarks for health insurance carriers. Several congressional bills have been filed in an attempt to remedy the situation.
U.S. Congressional House Subcommittee Holds Hearing on Medical Loss Ratios – Concerns Expressed about Broker Role
Last Thursday, the U.S. House of Representatives Small Business Subcommittee on Investigations, Oversight and Regulations held a hearing on the issue of the Medical Loss Ratio (MLR) in Washington, D.C. Titled “New Medical Loss Ratios: Increasing Health Care Value or Just Eliminating Jobs?,” the hearing was a forum for views on how the MLRs mandated by the Patient Protection and Affordable Care Act (PPACA) could impact the health care insurance industry. Most individuals testifying expressed concerns about how the MLR formula as currently structured could greatly hinder the ability of brokers and agents to support consumers and business owners when purchasing health insurance.
Medicare to Cover Preventive Services to Reduce Obesity: Prevention and Wellness Programs Gaining Momentum in Private and Public Sectors
Late last month, the Centers for Medicare and Medicaid Services (CMS) announced that the Medicare program will cover preventive services in an effort to combat obesity. In the past year, the federal government has launched a number of programs and funding initiatives to address the growing waistlines of Americans of all ages. The goal is to help us to live longer and healthier lives – along with reducing the cost associated with treating disease and managing chronic illness. Many of these campaigns have been fueled by the Patient Protection and Affordable Care Act (PPACA). These efforts mirror recent trends by health insurers and employers in the private sector to promote health and wellness.
The Department of Health and Human Services (HHS) just released its final Medical Loss Ratio rule, and the outcome does not bode well for the broker/agent community. In the ruling HHS has rejected the NAIC recommendation to exclude broker/agent fees from insurance companies’ allowed administrative costs.
Under the rule beginning this year, individual and small group market insurance plans will be required to spend 80% of the premiums on medical care and health care improvement. Only the remaining 20% will be allowed towards administrative costs. Much the same, large group plans will have an 85% of premium requirement.
Last week, BenefitMall reported on a hotly debated resolution adopted by the National Association of Insurance Commissioners (NAIC) to adjust the Medical Loss Ratio (MLR) formula to recognize the role of professional health agents and brokers. (To read the blog, click here).
One of the more positive aspects of the Patient Protection and Affordable Care Act (PPACA) was the authorization of a federal tax credit for small business owners who offer health insurance benefits to their employees. This tax credit potentially is worth a great deal of money to small business employers. Despite the potential for significant cost savings, efforts to promote the Small Business Health Care Tax Credit to small businesses have missed the mark.
The resounding cry of three state Medicaid directors at a recent roundtable focused on concerns related to the financing of state Medicaid and welfare programs. The directors participated in panel discussion held during the American Health Insurance Plan’s (AHIP) annual Medicaid Conference in Washington, D.C.
CMS Head Touts the Need for a Comprehensive Strategy to Support Medicare: Calls for Partnership with the Private Sector
In a keynote address delivered at the American Health Insurance Plan’s (AHIP) annual Medicare Conference on September 12, Donald M. Berwick, MD, administrator for the Centers for Medicare & Medicaid Services (CMS), addressed a number of issues associated with the long-term financial health of the Medicare Program.
His 45-minute speech centered on the need to address the rising costs required to fund the federal program supporting American seniors and a few special populations. In a humorous moment, Dr. Berwick noted that he just celebrated a big birthday last week and is now eligible to become a Medicare beneficiary himself, which has added some urgency to the matter.
Insurance Regulators Tout Strength of State-Based Insurance and Financial Regulation on Capitol Hill
With all the focus at the federal level on health care reform and budget spending shortfalls, a recent congressional hearing reminds us of the importance of state-based insurance regulation. The hearing focused on several financial technical provisions that don’t always impact brokers directly. However, an indirect relationship exists between the stability of health insurance offerings and the financial systems used to support and underwrite those offerings.
Last month, the NAIC published a brief video to help answer questions posed by consumers regarding the Patient Protection and Affordable Care Act (PPACA). Brokers and agents may want to use this video as a reference tool for their clients. Subjects covered by the video include:
- Individual and employer mandates
- Pre-existing conditions
- Healthcare exchanges
- Preventive care measures
- Medicare. 
to view the video.