TALLAHASSEE, Fla. –Today the Office of Insurance Regulation (Office) conducted a joint public hearing with the Florida Health Insurance Advisory Board (FHIAB) to review the impact of the federal Medical Loss Ratio (MLR) requirements. The medical loss ratio requirements, which come into effect on January 1, 2011, require health care insurance companies nationally to utilize a specific percentage of the premium dollar for medical coverage.
"I am concerned that the Medical Loss Ratio requirements included in the Affordable Care Act could cause disruptions in the Florida health insurance marketplace," remarked Commissioner McCarty. "I am especially concerned about how the MLR requirements will affect the role of health care agents who are critically necessary to help consumers in this increasingly complicated health care landscape."
Florida Insurance Commissioner Kevin McCarty was one of 34 insurance commissioners from around the nation to meet with President Obama on this issue at the White House on September 22, 2010.
The hearing this morning in Tallahassee was very different from a public hearing held in Orlando on May 4, 2010 as the participants had received additional guidance from the Department of Health and Human Services (HHS) as to the interpretation of the law. In addition, the hearing held today was an evidentiary hearing that included putting participants under oath. The purpose was to gather concrete information that could be potentially be used if the Office makes an official petition for a waiver to HHS Secretary Kathleen Sibelius. The official record will remain open, and the Office will continue to accept written testimony through October 8.
During the hearing several members of industry testified including representatives from Aetna, AvMed Health Plans, Golden Rule (a subsidiary of UnitedHealthcare), and U.S. Health Plans. Their testimony was relatively consistent remarking that the MLR requirements scheduled to be implemented in January would create impediments to new competitors, a misalignment of costs (as individual health plans are more expensive in earlier years), and significant disruptions in the marketplace.
Some agent groups, including a representative from the National Association of Insurance and Financial Advisors, also testified and warned the new MLR requirements would cause an exodus of agents from the marketplace leaving consumers without competent financial advisors to assist consumers to understand changes in the health care system. Finally, there were consumer advocate groups there, including a representative of the Florida Alliance for Retired Americans, who encouraged the group to implement the MLR requirements as Congress intended since they could be an important tool to help control health care costs.
After the break, the FHIAB conducted its regular business, which included FHIAB's adoption of a resolution to request a waiver from HHS regarding the implementation of the MLR requirements on January 1, 2011. The meeting also included an update on the federal health care legislation by Florida Deputy Insurance Commissioner Mary Beth Senkewicz, and approval of the 2009 FHIAB Report
that summarizes the status of the Florida health care marketplace.
About the Florida Health Insurance Advisory Board (FHIAB)
The Florida Legislature established the Board in 1992 to promote the availability of health care coverage to small employers. In 2005, the Board’s responsibilities expanded to include an advisory role on health insurance issues to executive departments in Florida and the Florida Legislature. Insurance Commissioner Kevin McCarty is the chairman of the FHIAB. For information about the FHIAB, please visit http://www.floir.com/Sections/LandH/FHIAB.aspx