Academy Activities

Academy Senior Health Fellow Cori Uccello has been appointed to the Medicare Payment Advisory Commission (MedPAC). MedPAC is an independent Congressional agency that advises Congress on payments to health plans participating in the Medicare Advantage program and providers in Medicare’s traditional fee-for-service programs. Uccello’s term expires in 2013. The appointment was made by the Government Accountability Office and announced in a May 14 press release.

The Academy's Premium Review Work Group responded on May 14 to a request for comments from the Department of Health and Human Services on Section 2794 of the Public Health Service Act, which was created by the recent enactment of the Patient Protection and Affordable Care Act (PPACA). Section 2794 requires the HHS secretary to work with states to establish an annual review of unreasonable rate increases, to monitor premium increases, and to award grants to states to carry out their rate review processes. On May 8, the work group sent a letter with preliminary thoughts and questions on Section 2794 to the National Association of Insurance Commissioners (NAIC).

The Academy's Medical Loss Ratio Regulation (MLR) Work Group also responded on May 14 to a request for comments from the departments of Health and Human Services, Labor, and the Treasury on Section 2718 of the Public Health Service Act. Section 2718 places new requirements on health insurers with respect to the reporting of medical loss ratios and potential issuance of rebates by insurers in situations in which an insurer's actual MLR is below certain established thresholds. (The comments were submitted May 14 but were not yet available to post online as of press time. Please check the Academy’s health page next week for a copy of the comments.)

The Academy's MLR Work Group provided comments on May 12 to the NAIC in response to its request for input on defining an appropriate way to maintain statistical validity within the rebate process. The work group outlined three potential approaches for maintaining greater validity that could be used independently or in combination: aggregation of multiple blocks of business to enhance credibility, application of adjustments for statistical tolerance, and application of large claim pooling mechanisms.

Regulatory Updates

The Department of Health and Human Services issued an interim final rule on May 5 implementing the Early Retiree Reinsurance Program created under the Patient Protection and Affordable Care Act. The program will reimburse participating employment-based plans for a portion of costs incurred in providing health benefits to early retirees, their spouses, surviving spouses, and dependents. The rules are effective June 1, although HHS will still be accepting comments until June 4.

The departments of Health and Human Services, Labor, and the Treasury issued interim final rules on May 10 that will implement requirements for group health plans and health insurance issuers in the group and individual markets to extend dependent coverage for children under the age of 26, in accordance with provisions of the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act. The rules will apply to group plans and individual and group health insurance issuers for plan/policy years beginning on or after Sept. 23, 2010.

In the News

The Academy's adverse selection concerns regarding the Community Living Assistance Supports and Services (CLASS) Act were included in a question-and-answer piece about the new federal long-term care program in the New York Times' The New Old Age blog on May 3. The Academy's premium estimates for the program also were cited in a related article in the June issue of Kiplinger's Personal Finance.

The Academy Medical Loss Ratio Regulation Work Group's letter to the National Association of Insurance Commissioners regarding potential disruption to the individual health insurance market resulting from new medical loss ratio requirements was the subject of a May 5 National Underwriter Life & Health article. The work group asked regulators to consider options for adjusting the medical loss ratio calculation method for individual market products.

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