Final Medical Loss Ratio Rule Rebuffs Insurance Agents

[ProSense]

Source: Kaiser Health News

The Obama administration issued a rule today that is sure to disappoint insurance agents: Fees paid to brokers and agents won’t count as medical care, under limits imposed on insurers in the 2010 federal health law.

That’s key because under the health law, insurers must spend at least 80 percent of their premium revenue on medical care and quality improvement – or issue rebates to consumers. The target is 85 percent for large-group issuers.

Brokers had lobbied hard to have their fees exempted from the calculation of administrative costs, which also includes such expenses as marketing and executive salaries, saying that without such a move, commissions will be cut and agents could lose their jobs, leaving consumers without as much access to brokers who help them choose health insurance.

But consumer advocates fought the move, saying commissions are clearly administrative costs and removing them would make it easier for insurers to avoid paying the required rebates to consumers. Those rebates will go out next year to individuals and small-business policyholders whose insurers fail to hit spending targets this year. The rebates could come in the form of reduced premiums.


Read more: http://capsules.kaiserhealthnews.org/index.php/2011/12/final-medical-loss-ratio-rule-rebuffs-insurance-agents/

[dipsydoodle]

1. Good

.

[Schema Thing]

2. nice, especially since the health care act makes sales agents irrelevant

One website leads you to all the information on health insurance available, nicely formatted and including cost.

[SkyDaddy7]

3. There are many things I like...

about the new health care law...The Affordable care Act. It might not be Single Payer or have a PO but it is leaps & bounds better than what we had! This is a vast improvement that could be improved upon...Especially if it survives the SCOTUS & shows noticeable improvements which it already has.

If the SCOTUS votes the mandate down then we return to what we had & that would really suck!

[Hoyt]

4. The next to whine will be execs. Loss Ratio cap is as important to HCR as abolishing pre-existing.

Sure, single payer and PO would have been better -- but the reform enacted is much better than status quo. The Exchanges are the other twist that will improve the system. Obviously, subsidies need to be set to really help those on lower end of income scale.

[FrenchieCat]

5. An important ratio that will reduce health cost in a long run......

And that was one of the larger point of the reform.....

[Turbineguy]

6. My Daughter had her own Medical insurance.

She's young, it was about $70 per month. It was an HSA policy. The employer wanted to provide health insurance for the employees. I suggested they pay my daughters plan and contribute $100 per month into her HSA, saving themselves about $120 per month. Their broker said that was "impossible". It had to be all the employees or none.