A major new health care and health insurance cost control bill still includes a long agent and broker compensation provision — but senators don’t seem to be eager to talk about it.
The Senate Health, Education, Labor and Pensions Committee held a two-hour hearing on the Lower Health Care Costs Act bill draft Tuesday.
Senate HELP Chairman Lamar Alexander, R-Tenn., and the highest-ranking Democrat on the committee, Sen. Patty Murray, D-Wash., filed the bill later in the day. The bill now has a bill number: S. 1895.
Alexander and Murray said the Senate HELP Committee will vote on S. 1895 June 26.
The senators and witnesses at the health bill draft hearing talked about the surprise medical bills insured patients often get, even when they try to get care from in-network doctors and hospitals.
Participants also talked about air ambulance costs, telemedicine programs and insulin costs.
The producer comp disclosure provision came up just once: when Marilyn Barlett, an accountant, was talking about her experience with trying to cut costs at Montana’s state health plan.
Bartlett said she tried to find and act on every possible opportunity to cut costs.
She replaced the plan’s pharmacy benefits manager; kicked a popular, but expensive, drug store chain out of the plan network; and hired a health plan administrator to help Montana cope with huge variations in hospital service prices, by negotiating plan-specific rate deals with all Montana hospitals.
“We are now paying a transparent and fair price, and this change on its own saved millions for our health plan,” Bartlett said.
Bartlett also looked hard at Montana’s relationships with health plan brokers and consultants.
“The current system is flawed,” Bartlett said. “The broker consultant acts as the buyer’s agent, but most often is paid by the seller through confidential agreements.”
Other Montana officials “found up to 17 undisclosed revenue streams for brokers, consultants, TPAs [third party administrators], associations, and other costs within employer plans,” Bartlett said.
Bartlett acknowledged that she needed help from a consultant to overhaul the Montana plans. She said she contracted with a consultant that allows only for direct compensation to the consulting firm from the client plan.
“Compensation disclosure for brokers and consultants is a good step,” Bartlett said.
Federal law should also require compensation disclosure for all third parties that provide products or services to a plan, Bartlett said.
No other witnesses or senators talked about the producer comp disclosure provision. No senators asked Bartlett about her comments on produceer comp disclosure. One senator asked her about telemedicine program support for rural areas, and another asked her about air ambulance service costs.
The S. 1895 Comp Disclosure Provision
Section 308 of S. 1895 would require “disclosure of direct and indirect compensation for brokers and consultants to employer-sponsored health plans and enrollees in plans on the individual market.”
Firms serving group health plans would have to send the sponsors fiduciary compensation reports. The compensation reports would have to list the services provided and the firm’s compensation sources.
In the individual market, health coverage issuers would be responsible for providing the producer compensation reports.
A copy of S. 1895 is available here.
Links to hearing resources, including a video recording of the hearing, are available here.
— Read Lamar Alexander Won’t Run for Re-Election in 2020, on ThinkAdvisor.