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Life Health > Health Insurance > Health Insurance

Rate Regs Nixed In House Health Reform Bill

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WASHINGTON–As health care reform heads for a possible House vote by Sunday, Mar. 21, rate regulation provisions the Obama administration had touted as critical–and industry officials saw as their greatest concern–are absent from the bill the House is considering.

Healthcare insurance industry officials told the National Underwriter the provisions were left out because the Senate parliamentarian ruled that including such a provision would not comply with the so-called Byrd rule.

This rule limits what can be included in legislation that is allowed to pass the Senate only on majority vote through the reconciliation process.

Officials of the Council of Insurance Agents and Brokers lauded the decision.

Joel Kopperud, a director of government relations at the CIAB, said the omission of the rate regulations was “the most significant potential change for our members and was the centerpiece of President Obama’s proposal for what should be included.”

In addition to the rules governing reconciliation with the Senate, “the pragmatics of trying to create a new oversight regime on the fly may have been dissuasive to Democratic leaders,” Kopperud said.

But officials of America’s Health Insurance Plans said there are major gaps in the legislation.

“For health care reform to work, everyone needs to be covered and the growth in health care costs must be brought under control,” said Karen Ignagni, AHIP president and CEO.

“Healthcare reform legislation that does not address underlying medical costs cannot be sustained. Unfortunately, this legislation will drive up health care costs by adding billions in new health care taxes and encouraging people to wait until they are sick before getting insurance.”

Among other provisions critical to the industry, the medical loss ratio in the House bill would be 85% for Medicare Advantage plans. Otherwise, the MLR provisions track with the Senate-passed bill- 85% for plans of more than 100; 80% for small plans.


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