NAIC Blasts Health Czar

The Association of State Insurance Commissioners are coming out against the centralization of healthcare the House is proposing. They argue that the proposed Health Choices Adminstration "would merely add more regulation and cost without enhancing consumer protection.” Are they listening?

Posted on lifeandhealthinsurancenes.com

By ARTHUR D. POSTAL Published 7/16/2009

WASHINGTON BUREAU -- The National Association of Insurance Commissioners is asking the leaders of 3 House committees to give up the idea of creating a separate federal agency with strong powers to oversee health delivery.

The proposal is in Section 141 of the “committee print” of H.R. 3200, “America’s Affordable Health Choices Act,” the health system bill now being marked up in the House.

The provision would create the Health Choices Administration, an independent federal agency headed by a commissioner appointed by the president.

The HCA would have market conduct oversight authority as well as authority to establish standards for operation of the public health coverage plan that is part of the House bill.

The HCA also would have authority to establish standards for qualified private plans and oversee the health insurance exchange that would serve as an Internet-based clearinghouse for health insurance information and choices.

The House Ways and Means Committee is meeting today to mark up the finance-related sections of H.R. 3200.

The House Energy and Commerce and Education and Labor Committees will mark up their portions of the bill next week.

The plan is to have the bill ready for floor action by next Thursday.
In a letter sent to the chairmen and highest-ranking members of each of the House committees drafting the final bill, Sandy Praeger, the Kansas insurance commissioner and chairman of the Health Insurance and Managed Care Committee at the NAIC, Kansas City, Mo., argues that the HCA would merely add more regulation and cost “without enhancing consumer protection.”

Praeger cites what she says are the “egregious failures” created by the inability of the federal Centers for Medicare and Medicaid Services to properly oversee marketing of Medicare Advantage plans.

Reliance on federal Medicare Advantage oversight left “millions of seniors exposed to deceptive, fraudulent and abusive sales tactics that would have been prevented had the states been allowed to act,” Praeger writes.
The NAIC believes that a single federal blueprint is unlikely to be effective in every state because “health care delivery systems, demographics, rural and urban mix, economies and labor markets are distinctive and regulations that fail to take those distinctions into account will damage markets and consumers,” Praeger writes.

The House bill would give the proposed HCA director no guidance about the content of health coverage standards, “making it probable that these standards would change dramatically with each new administration,” Praeger writes.

Praeger also warns that healthy consumers may opt to pay the modest annual penalty the bill would impose on individuals without acceptable health coverage rather than pay much more to buy health insurance.
That would cause “adverse selection that increases the cost of coverage for all and defeating the purpose of the requirement that all Americans obtain coverage,’ Praeger writes.