WASHINGTON BUREAU — Health agent groups are urging the U.S. Department of Health and Human Services to take a flexible approach when implementing the minimum medical loss ratio provisions in the new Affordable Care Act.
ACA is the legislative package that includes the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act.
Commenters have submitted more than 100 responses to an initial MLR notice put out by the Centers for Medicare and Medicaid Services, an arm of the HHS.
CMS is supposed to work with state insurance regulators to make sure that insurers spend at least 85% of the premiums collected from large groups and at least 80% of the premiums collected from small groups and individual insureds on medical costs.
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The health agent groups say in their comment letter that they are “extremely concerned” about the possibility that putting a narrow MLR definition in the final regulations would hurt important health plan activities.
“If they are somehow diminished due to narrow MLR definitions and enforcement, the quality of care delivery for consumers will deteriorate and health care costs will surely increase,” the agent groups write in their comment.
A narrow MLR definition could cut spending on health plan activities such as case management, wellness, disease management, and fraud and abuse prevention, the agent groups write.
The agent groups ask HHS to consider NAIC accounting rules relating to “medical loss” when defining “medical loss” in the new regulations, but to widen the definition to reflect congressional intent.
The NAIC MLR accounting standard defines “medical loss” as the value of medical claims an insurer actually pays, or “incurred claims,” plus “contract reserves,” or the amount of money the insurer sets aside to pay future claims.
The new federal minimum MLR law “takes a broader view of MLRs,’ the agent groups write.
The groups note that Congress included the cost of activities that improve health care quality as well as the cost of clinical services in the ACA minimum MLR provision.
The groups that submitted the comment are the Council of Insurance Agents and Brokers, Washington; the Independent Insurance Agents and Brokers of America, Alexandria, Va.; the Council of Insurance Agents and Brokers, Washington; the National Association of Health Underwriters, Arlington, Va.; and the National Association of Insurance and Financial Advisors, Falls Church, Va.
NAHU “strongly believes that health care consumers will best be served by a definition of clinical services and activities that improve health care quality which is comprehensive and inclusive,” NAHU Chief Executive Janet Trautwein told National Underwriter.
The definition needs to be comprehensive and inclusive “so that it adequately accounts for the wide spectrum and types of insurer activities that contribute to better health outcomes and health care delivery and provides a level playing field among different types of insurers and products,” Trautwein said.
CMS officials already have posted dozens of the comments they have received. Many of the comments are more than 10 pages long, and many have been submitted by groups, insurance regulatory agencies or other organizations that have based their recommendations on the results of extensive policymaking processes of their own.
Texas Insurance Commissioner Michael Geeslin, for example, submitted 29-pages of comments.