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CCH® BENEFITS — 09/02/10

NAIC Approves Form For Medical Loss Ratio Reporting

from Spencer’s Benefits Reports: The National Association of Insurance Commissioners (NAIC) Executive Plenary Committee has approved final implementation of a medical loss ratio (MLR) “blanks” to implement Public Health Service Act 2718 as added by the Patient Protection and Affordable Care Act.

Blanks are the actual forms submitted by insurance companies to report financial information to state regulators. Regulators will then review this data to calculate the required medical loss ratio and any rebate required under the new federal law.

The instructions on the form could change, depending on the definition of medical loss ratio that the NAIC eventually adopts and has certified by the secretary of the Department of Health and Human Services.

America’s Health Insurance Plans (AHIP) has criticized the proposal for failing to include fraud prevention and detection.

AHIP has recommended the following to the NAIC:

• “Structure the quality framework in a way that allows for the recognition and encouragement of new quality and care improvement initiatives and does not limit permissible programs to those that are currently in the market today.
• “Reconsider the exclusion of fraud prevention and detection because of its importance to the vital and universally recognized goals of improving health care quality and patient outcomes. Currently, retrospective review is excluded, yet it is a key tool in targeting the dangerous overutilization of services, falsification of medical records, and medical identity theft.
• “Reconsider the exclusion of costs associated with the ICD-10 implementation. The effort to convert to ICD-10 codes will improve the ability of health plans to share clinical data among clinicians for quality improvement and care coordination activities, thereby promoting a better understanding of diagnoses and procedures at institutional settings of care to allow better treatment and quality improvement.
• “Reevaluate the exclusion of concurrent utilization review and the implications this will have on programs designed to improve patient safety and to assure that consumers receive the right care, at the right time, and in the right place. These tools play an important role in addressing growing concerns over variations in imaging use across geographic regions and the potential overuse of imaging services.
• “Reevaluate the exclusion of individual coverage from the wellness and health promotion guidance. The new legislation envisions a transition to wellness-centered care and calls for a pilot wellness program in the individual market. Therefore, it would appear to be inconsistent to prohibit incentives from being offered to consumers purchasing coverage on their own at the same time they are offered to employers in small and large groups.
• “Adopt a standard methodology to address needed MLR transition rules to promote stability of health plan choices in the individual and small group markets and avoid a potential disruption of coverage for millions of Americans prior to implementation of the 2014 market reforms.”

For more information on the NAIC proposal, visit http://www.naic.org/index_health_reform_section.htm.

For more information on AHIP, visit http://www.ahip.org.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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