The National Association of Insurance Commissioners on Tuesday passed a resolution urging the Department of Health and Human Services to take action to preserve the role of professional health insurance agents and brokers as advisers and advocates. The National Association of Health Underwriters praises the NAIC for the move.

“This action taken by the NAIC 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 Patient Protection and Affordable Care Act,” says Janet Trautwein, CEO of NAHU. “The commissioners recognize the ‘essential’ role health insurance professionals play in protecting the health and financial well-being of Americans, as well as how the ill-advised medical loss ratio measures prevent these licensed professionals from effectively assisting consumers in making educated decisions about their coverage needs.

The Obama administration issued the medical loss ratio rule exactly one year ago Tuesday that requires health insurers to keep control of their overhead costs. Under the rule, insurers must spend 80% of a consumer’s premium dollar on improvements in quality of care and direct care for patients while employers covering more than 50 people must pay 85%. That leaves less than 20% for administrative costs such as professional health insurance agents and brokers.

Texas Insurance Commissioner Eleanor Kitzman recognized the importance of the issue but has concerns. "While I support the goal of the NAIC resolution and believe consumers need the qualified assistance of health insurance agents and brokers now more than ever, I do not believe this resolution is the best way to ensure that agents and brokers are able to continue to provide valuable services to consumers. In a market with more than 30 small- and medium-sized health insurance carriers, agents are critical to promoting a competitive market and ensuring that consumers obtain the coverage that best suits their needs." 

Kitzman adds that it's unfortunate that consumers are being put in a "no-win situation and are being forced to navigate an overly and unnecessarily complex system without the benefit of expert, trusted advisers." 

“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.’ 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,” adds Trautwein.

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