No loss ratio adjustments for Kan., Okla.

The CMS' Center for Consumer Information and Insurance Oversight has denied Kansas (PDF) and Oklahoma (PDF) their requests for medical-loss ratio adjustments, bringing to eight the number of states that will not receive exceptions to the standard that requires insurance companies to spend at least 80% of premium dollars on medical care.

Kansas had asked that the medical-loss ratio standard—a consumer protection in the Patient Protection and Affordable Care Act—be adjusted so health plans would spend 70% of premium dollars on medical care in 2011, and then gradually move to 73% in 2012 and 76% in 2013.

“With respect to Kansas, based on the information the state provided, we concluded the insurance companies in the individual market are able to meet the 80-20 standard, and, if they're not now, they will be able to do so in the future,” Steve Larsen, director of the CMS' Center for Consumer Information and Insurance Oversight, said during a call with reporters on Wednesday. “We do not conclude that this market would be destabilized,” he said, adding that his office also doesn't foresee any insurance companies withdrawing as a result of the standard.

Similarly, in Oklahoma, issuers made it clear that they would not leave the market, and that they already meet the 80% standard or will in the future, Larsen explained. The state had requested the medical-loss ratio be changed to a threshold of 65% in 2011, 70% in 2012 and 75% in 2013.

Responding to questions, Larsen said his office values the role insurance agents play—both now, and when health reform is implemented fully in 2014. “There may be companies that make a decision to reduce agent commissions,” Larsen said. “That's their decision. I think some companies have exploited the ACA to reduce agent commissions.”