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Watchdogs Back LTC Safeguards

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National Association of Insurance Commissioners members have thrown their support behind a federal bill that would strengthen protections for long term care policy holders.

In a letter to Senator Herb Kohl (D-Wisc.), Chair of the Special Committee on Aging, the NAIC backed amendments to a bill, S. 1177, that would improve disclosure, producer training, consumer education and information, and rate stability for LTC insurance.

The language, drafted by Kohl, is being proposed as an amendment to the bill, a health care reform measure introduced by Senator Ron Wyden (D-Ore.)

“In consultation with consumer representatives, the long-term care insurance industry and other stakeholders, the NAIC has developed model laws and regulations that provide extensive consumer protections to long term care insurance policyholders,” NAIC president and New Hampshire Insurance Commissioner Roger Sevigny wrote to Kohl. The amended bill “would update federal consumer protection standards and institute a formal process for incorporating new NAIC-adopted protections in tax-qualified and Partnership plans.”

The NAIC recently completed standards for external review of insurers’ denials of LTC claims, Sevigny noted in the letter.

“We also agree that both federal and state officials need to remain vigilant in monitoring the long term care insurance marketplace,” commented Sean Dilweg, vice chair of the NAIC senior issues task force and Wisconsin Insurance Commissioner.

Among its provisions, S. 1177, the Confidence in Long Term Care Insurance Act of 2009, would require the Secretary of Health and Human Services to ask the NAIC to review LTC insurance markets every 5 years, including data on complaints, cancellations, and premium rate increases.

It would also provide for a Web-based listing of information consumers could use to compare various LTC insurance policies with different benefits and features, including state partnership policies.

The bill would also require states offering partnership polices to establish rating standards for all insurers selling such policies in the state that provide no less protection to consumers than those in the premium rate increase standards specified in NAIC model regulations.