Gregory Serio, the New York state insurance superintendent, and America’s Health Insurance Plans, Washington, are welcoming the release of the new regulatory modernization “road map” proposal.[@@]
Rep. Richard Baker, R-La., chairman of the Capital Markets Subcommittee of the U.S. House Financial Services Committee, released the long-awaited discussion draft of the road map bill Aug. 20.
The road map bill, officially dubbed the State Modernization and Regulatory Transparency Act, is a “good start” for discussions on modernization of insurance regulation, Serio says. “It shows that they [federal lawmakers] have been listening to what we have to say.”
Serio is one of the state insurance commissioners at the National Association of Insurance Commissioners, Kansas City, Mo., who have been working with Congress to create federal tools that could help modernize state insurance regulation. That road map draft is “a reflection of the series of discussions that have already taken place,” Serio says.
The draft still has to be vetted by the NAIC membership, but it does include many of the initiatives that the NAIC is working on, Serio says.
Serio cites sections that include NAIC work on topics such as speed-to-market initiatives, but he says there are still concerns about the notion of a federal entity regulating insurance. And there are differences about how rates should be regulated, he says.
Serio says a provision in the road map stating that the McCarran-Ferguson Act would continue to be a basis for insurance regulation reflects what Baker and Rep. Michael Oxley, R-Ohio, the House Financial Services Committee chairman, have been saying all along: that the federal government is not looking to replace state insurance regulation.
Serio adds that he does not know how NAIC members ultimately will react to the current version of the road map.
AHIP President Karen Ignagni says the draft does a good job of streamlining the process by addressing external review, speed-to-market and market conduct standards. For instance, she says, AHIP sees an opportunity in creating an “evidence-based” external review system.
“We see it [regulatory modernization] as a balance between product and process standards,” Ignagni says.
Ignagni praises provisions that could help health insurers get products to market more quickly. Her group has an anecdote about a CEO who says getting one product approved took a year.
But, when it comes to health product standards, “there is real utility in local product standards,” Ignagni says.