Florida Insurance Commissioner Kevin McCarty Prevails in Securing Resolution to Ensure Continued Consumer Access to Professional Health Insurance Producers

Commissioner Kevin McCarty, incoming President of the National Association of Insurance Commissioners (“NAIC”), secured passage of a resolution by the NAIC urging Congress to take action amending the Medical Loss Ratio (“MLR”) provisions of the Patient Protection and Affordable Care Act (“PPACA”) and requesting the Department of Health and Human Services (“HHS”) to take immediate actions available to the Department in order to preserve consumer access to agents and brokers.

Insurance producers, agents and brokers provide a wide range of services to consumers that are invaluable. Such services include, but are not limited to, guidance regarding benefit and contribution arrangements to ensure compliance with applicable state/federal laws and regulations, on-site assistance to aid in employee benefit communication, and advocacy for employees through the health insurance claim process. The services are essential to the protection of consumer rights. Adverse effects of MLR requirements on insurance producers threaten to disrupt the continued service provided by insurance producers to consumers. Concern over the disruption of the insurance market, due to the MLR requirements, has sought several insurance commissioners to request MLR adjustments for their individual markets. Obtaining such an adjustment is a very complicated process.

The PPACA directs the NAIC to develop standardized definitions and methodologies to be used to implement the MLR requirements. The NAIC has consistently expressed its concern regarding the adverse effects of the MLR requirements on insurance producers and their ability to continue providing consumers with advocacy and service customarily provided. In November 2010 the NAIC established the Professional Health Insurance Advisors Task Force to review the MLR requirements and recommend options for addressing the negative impacts.

The NAIC’s resolution urges Congress to expeditiously consider legislation amending the MLR provision of the PPACA in order to preserve consumer access to agents and brokers. Additionally, the resolution requests HHS to take immediate actions to mitigate the adverse effects the MLR rule is having on the ability of insurance producers to serve the demands of consumers. Potential options identified for HHS’s consideration are:

• approving state MLR adjustment requests;
• placing an immediate hold on implementation and enforcement of the MLR requirements; and
• consider the NAIC’s finding that a significant portion of insurance producer activities are dedicated to consumer advocacy and service and classify an appropriate portion of producer compensation as a health care quality expense for purposes of the PPACA

National Association of Insurance and Financial Advisors-Florida lobbyist, Tim Meenan, commended Commissioner McCarty for pursuing the resolution and as it advocates action on behalf of insurance producers as well as consumers.