Florida Insurance Commissioner Kevin McCarty, along with lead regulators from more than two dozen other states, recently voted unanimously to approve the NAIC’s recommended language for the Medical Loss Ratio (MLR) definition under the federal Affordable Care Act.
Because of the way medical defenses are defined, health insurance agent premiums were not included in the definition of medical losses. But McCarty has said that an immediate adoption of the MLR ratios without accommodating the needs of health insurance agents will negatively impact the selection process for health insurance in the small group and individual markets.
“With the passage of federal health care reform, the healthcare insurance system has become even more complex,” McCarty said in a statement. “Although it is not considered a ‘medical expense,’ trained healthcare agents must remain an integral part of the health insurance process by helping businesses and families tailor healthcare insurance plans to meet their individual needs.”
McCarty co-sponsored a resolution that was adopted by the NAIC demonstrating the NAIC’s commitment to keeping agents as an integral part of the health insurance selection process for small businesses and individuals. Florida also sponsored a charge adopted by the Health Insurance and Managed Care (B) Committee, instructing the NAIC to continue to work on other methods, possibly through a model law or statute, which will retain the role of health insurance agents within the framework of the federal law, and within the framework of the MLR definition.
Florida’s Office of Insurance Regulation has scheduled another hearing to discuss the MLR issue in Tallahassee for September 24. Information gained in the hearing will be used to create legislation that preserves the role of health insurance agents in Florida.
However, although the NAIC has adopted MLR language, the question still remains about the implementation date. The NAIC is recommending a three-year transition period for implementing the MLR standards under the federal law to minimize disruption in the marketplace. McCarty supports this transition period. A transition period may also give the NAIC, the department of Health and Human Services, and the state of Florida time to adequately resolve the health insurance agent issue prior to full implementation of the MLR standards.