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While roughly 83% of adults in the United States will visit a health care provider in the next year, an estimated
News
7-7-11 Affordable Care Act Update
July 8, 2011
Federal Update
Medical Loss Ratio
Last Thursday, a National Association of Insurance Commissioners (NAIC) task force recommended that the NAIC endorse the Access to Professional Health Insurance Advisors Act (HR 1206), which would take broker and agent commissions out of the medical loss ratio (MLR) calculation created by the Affordable Care Act.
The ACA requires insurers to spend at least 80 percent of their premium revenue on health care claims and quality improvement costs. Beginning this year, insurers who miss the target are required to rebate the difference to policy holders. The minimum MLR is one of the most important short-term consumer protections the ACA provides. Had the provision been in effect for 2010, insurers would have had to rebate almost $2 billion to consumers. Rebates are likely to have been less for 2011, however, because insurers are expected to reduce their premiums or limit premium increases to avoid rebates. There is growing evidence that the MLR is in fact having a positive effect on mitigating health insurance premium increases. The MLR is clearly an important tool for consumers.
The NAIC's Executive Committee meets via teleconference Tuesday to consider its next step. ACS CAN is concerned about the task force’s action and will be reaching out, along with other consumer groups, to committee members to encourage them to require that the NAIC as a whole take up the issue during its national meeting in August. The information the task force collected does not support the NAIC’s earlier recommendation to include broker and agent commissions in the MLR. We will keep you apprised of the outcome of Executive Committee's call as we continue to work with other consumer groups to advocate strongly for a more consumer-friendly NAIC stance on HR 1206.
Read more in Congressional Quarterly.
Menu Labeling
ACS CAN recently submitted comments to the Food and Drug Administration (FDA) on the implementation of the menu labeling and vending machine labeling requirements in the ACA, in response to two proposed rules from the agency. The ACA requires that all restaurants and similar food retailers that are part of a chain of 20 or more provide calorie information for standard menu items on menus and menu boards, and make additional nutrition information available upon request. The ACA also requires vending machine owners or operators of 20 or more vending machines to post calorie information for all items that do not already provide this information on the package that is visible to the consumer prior to purchase. The law prohibits states and localities from enacting stricter requirements for venues or items covered by the federal menu labeling or vending machine labeling law.
ACS CAN supports providing consumers with information to help them make healthy food choices. We supported the proposed rules on both menu labeling and vending machine labeling. However, we also encouraged the FDA to broaden the scope of the menu labeling requirements to include such venues as movie theaters, airplanes, and cafes within general merchandise stores. We also encouraged the FDA to require calorie labeling for alcoholic beverages, which their proposal does not currently mandate. In addition, we recommended that the rule’s preemption provisions be interpreted narrowly, to preserve as much local control as possible over other types of nutrition labeling.
Exchange Regulation Due Out Soon
ACS CAN expects the administration to release a draft regulation governing health benefit exchanges soon. Few details are known about the draft rule, but it is likely to cover a broad spectrum of issues. ACS CAN will review the rule with the same threshold questions in mind that we distributed to Division advocacy staff to use in evaluating state exchange proposals. The threshold questions are attached, as is a preview story in Congressional Quarterly that quotes ACS CAN Senior Policy Director Steve Finan.
State Update
This week, Connecticut's governor signed health insurance exchange legislation, making the state the 11th to establish an exchange since passage of the Affordable Care Act. The others are California, Colorado, Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont, Washington and West Virginia. The governors of Alabama, Georgia and Indiana have issued executive orders creating panels to study exchanges, while the governors of Mississippi, North Carolina, North Dakota, Virginia and Wyoming have all signed bills that allow the legislative process to move forward without yet establishing an exchange.
Read an article about the progress of state exchange legislation from The Hill.
As always, thank you for all you do every day to support laws and policies that help cancer patients and their families.
Christopher W. Hansen
President
American Cancer Society Cancer Action Network (ACS CAN)