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Trade Groups React to NAIC Vote on MLR Exemption

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Insurance agent trade groups today lauded the National Association of Insurance Commissioners for supporting them in their quest for relief from a provision in the healthcare reform law that has seen their healthcare insurance commissions drop precipitously. Last night, the NAIC passed a resolution to request the Department of Health and Human Services to exempt agents’ commissions from medical loss ratio calculations, a requirement put into law by the Patient Protection and Affordable Care Act. The MLR provision has met with staunch resistance from the agency community.

Those commenting included officials of the National Association of Insurance and Financial Advisors, the National Association of Health Underwriters, and the Independent Insurance and Brokers of America, all based in Washington, D.C.

The resolution asks Congress and the Department of Health and Human Services to act promptly in providing an exemption for agent commissions from the medical loss ratio provision of the Patient Protection and Affordable Care Act.

Robert Miller, president of the National Association of Insurance Financial Advisors said state insurance commissioners “took a big step in an effort to undo some of the damage done by last year’s national health care reform law.”

He said the NAIC resolution acknowledges that the Medical Loss Ratio provision of the health care law has destabilized insurance markets and harmed consumers by hampering the ability of agents to act on their behalf.

“It’s now up to our leaders in Washington, either in the administration or Congress, to finally resolve the MLR problem,” he said.

Janet Trautwein, the CEO of the National Association of Health Underwriters, said the NAIC decision “makes great strides” in the battle to ensure all Americans have access to health insurance professionals as they navigate the complicated laws and regulations resulting from the PPACA.

“We hope HHS will heed this recommendation to ‘take whatever immediate actions are available to the Department to mitigate the adverse effects the MLR rule is having on the ability of insurance producers to serve the demands and needs of consumers and to more appropriately classify independent producer compensation in the final PPACA MLR rule’, ” Trautwein said.

In doing so, “HHS will prevent further economic hardships for health insurance agents and brokers so they are able to continue to help American families, businesses and individuals plan for a healthy, financially-sound future,” Trautwein said.

Charles Symington, senior vice president for government affairs for the Independent Insurance Agents and Brokers of America, said that, “We urge Congress and HHS to take note of this important action by the NAIC and move forward with immediate relief from the MLR regulations for agents and brokers.”

He said Congress can provide a permanent and proper fix by removing agent compensation from the MLR calculation, but meanwhile HHS has the power to relieve the downward pressure on agent compensation through regulatory action.


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