NAIC Makes Progress on Model State Laws – Comments are Welcome – Say Ahhh! A Children’s Health Policy Blog

It’s been a busy few weeks for the National Association
of Insurance Commissioners (NAIC), as they move forward on implementing key
provisions of the ACA.  A summary
of the latest activity – and ways you can get involved – are summarized below.

1. Exchanges. 
The NAIC’s subgroup on exchanges just reported out a model state law providing for the establishment
of an insurance exchange.  The
model will next be considered and voted on by the NAIC’s main health committee
(also called the “B” committee) on Monday, November 22.  States considering the NAIC model
should recognize that it is designed to simply lay out the minimum requirements
of the ACA, and that NAIC decided early on they were unlikely to reach
consensus on tricky policy issues like regulation outside the exchange market,
state benefit mandates, and whether the exchange can actively negotiate with
plans.  It also doesn’t at all
address the very challenging operational issues surrounding the SHOP exchange
and coordination with the state’s Medicaid and CHIP programs.  However, NAIC is going to develop a
series of white papers on a range of issues states may have questions about,
including: governance, financing, the role of insurance agents and brokers, and
transparency.  They also intend to
develop a model law for a regional exchange, which could help smaller and
low-population states pull together a more efficient and sustainable
exchange.   It’s by no means
perfect, but I worked with fellow consumer advocates to improve this model
along the way, and we’re supporting its adoption.  If you want to comment on the model,
email Jolie Matthews at NAIC at [email protected] on or before Friday,
November 19.  

2. The September 23, 2010 patient protections.  A key NAIC task force just adopted a range
of model state laws to implement the ACA insurance provisions that went into
effect on September 23, 2010. 
These are important because in many states they will give the Department
of Insurance the authority it needs to effectively monitor and enforce
insurers’ compliance with the law. 
Just as with the Exchange model, these will be considered and possibly
voted on by the B Committee on November 22.  These include models on:

  • Dependent coverage up to age 26
  • Annual and lifetime limits
  • Free preventive care
  • Elimination of Rescissions
  • Choice of provider
  • Grievances/appeals
  • Guaranteed issue for children under 19

These models are intended to mirror the requirements in
the ACA and the resulting federal regulations.  While the drafting process went relatively smoothly, the
task force was not able to settle a critical issue – whether the ACA’s consumer
protections set a “floor” or a “ceiling” for state regulation.  Consumer representatives and the
insurance commissioners themselves argued that the law allows states to enact
stronger protections if they choose to, but the insurance industry claimed that
the ACA sets a “ceiling” that states can’t go beyond.  Advocates should expect to hear similar arguments from
carriers as these models are considered in the states.  I worked hard with my consumer
representative colleagues to get a number of improvements incorporated into
these drafts, and we are supporting their adoption by the full NAIC.  If you want to comment on any of the
email Jolie Matthews at  
[email protected] by Friday, November 19.

3. Consumer Information.  The NAIC’s Consumer Information Working Group just adopted a
summary of benefits form and accompanying glossary of insurance terms.  It will also be voted on by the B
Committee on Monday, November 22. 
Under the ACA, all health plans will have to provide this form, which
summarizes plan-specific premiums, cost sharing, benefits and any policy
exclusions, to consumers shopping for coverage.  NAIC has been charged with developing the template for this
form and the glossary, and if it is approved by the full plenary of the NAIC
(likely in early December), it will be submitted to HHS and incorporated into a
regulation due out by March 23, 2011. 
Unlike the usual NAIC process, the ACA requires the Consumer Information
group to include non-regulator stakeholders as voting members, including
consumer, insurance industry, and provider representatives.  As a result, the form and glossary were
developed through a painstaking consensus process that involved over 120 hours
of meetings, each lasting from 2-6 hours, including at least 25 conference
calls.  As a member of the working
group, I’d like to think we did a pretty good job with these drafts, but would welcome feedback from any interested parties.  And of course, anyone can provide
comments directly to NAIC by emailing Jennifer Cook at [email protected] or Jane
Sung at [email protected]

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