Regulators should make room for anti-fraud efforts when adding up medical costs, according to the Coalition Against Insurance Fraud.
The CAIF, Washington, and another group, the National Insurance Crime Bureau, Des Plaines, Ill., make that argument in a comment letter submitted to the National Association of Insurance Commissioners, Kansas City, Mo.
The NAIC has been developing advice for the officials at the U.S. Department of Health and Human Services who are responsible for implementing the minimum medical loss ratio provisions in the Affordable Care Act – the legislative package that includes the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act.
Starting Jan. 1, 2011, the minimum ratios are supposed to be 85% for large groups and 80% for small groups and individuals.
The ACA provision states that health insurers can include the cost of health quality improvement efforts in the medical cost total.
The CAIF – a group that includes representatives from life insurers and groups such as the Consumer Federation of America, Washington, as well as property-casualty insurers – and the NICB, a group that fights automobile theft fraud, say the new minimum MLR rules should treat anti-fraud efforts as quality-improvement efforts.
“Excluding anti-fraud expenses by insurers in the medical loss ratio would discourage insurers from investing in anti-fraud activities, which would be counter to long-held public policy that encourages insurers to develop effective programs to combat fraud,” the CAIF and the NICB write in their comment letter.