The National Association of Insurance Commissioners (NAIC) should resist the urge to water down a minimum medical loss ratio model draft, according to the people who represent consumers in NAIC proceedings.
The consumers reps and others have respounded to a request by the Health Insurance and Managed Care Committee at the NAIC, Kansas City, Mo., for comments on a draft of a minimum medical loss ratio (MLR) definitions and calculation methods model regulation that was developed by the NAIC’s Life and Health Actuarial Task Force (LHATF).
The proposed model, which would serve as a template for creating a Regulation for Uniform Definitions and Standardized Rebate Calculation Methodology for Plan Years 2011, 2012 and 2013, would help states implement minimum MLR provisions in the Patient Protection and Affordable Care Act (PPACA), an Affordable Care Act (ACA) component.
The provisions will require that the minimum amount of health coverage revenue going to medical care and quality improvement efforts be 80% for individual and small group coverage and 85% for large group coverage.
Carriers that fail to spend enough revenue on health care and quality improvement are supposed to send rebates to customers.
Regulators and interest groups have engaged in vigorous debate about the precise definitions to be used in the minimum MLR model.
One term that has been the subject of intense scrutiny has been treatment of sales commissions to be paid to agents and brokers.