The National Association of Insurance Commissioners has approved the financial forms that insurance companies will submit to state regulators and use to calculate their medical-loss ratios.
NAIC overwhelmingly approved the financial forms—called “blanks”—at a meeting in Seattle. Blanks are the actual forms that health insurers will fill out about their financial activities. State regulators will then use the completed forms to determine how much of customers’ premium dollars are being spent by the insurers on medical care.
Starting next year, under the health reform law, insurers are required to spend at least 85% of subscriber premiums on medical costs in large group coverage plans, and at least 80% for individual and small group plans. If they don’t meet these targets, they must give customers a rebate for the difference starting in 2012.
Regulations on this medical-loss ratio provision are expected this fall from HHS. NAIC is providing guidance on the issue, and so the blanks document has been eagerly awaited by insurers and consumer groups. HHS still must certify the blanks document.
NAIC is still putting the details into the final blanks document and will release it on Wednesday, a spokesman said.
America’s Health Insurance Plans, the leading trade group for insurers, warned in a statement that “the current proposal could have the unintended consequence of turning back the clock on efforts to improve patient safety, enhance the quality of care, and fight fraud.”
Health Care for America Now, a consumer advocacy coalition, called the vote “a step toward ending the health insurance companies' stranglehold on our healthcare.”