State insurance regulators have stuck a stick in a hornet's nest and are now reading the comment letters from the hornets.
The regulators are members of the Regulatory Framework Task Force, part of the Health Insurance and Managed Care Committee at the National Association of Insurance Commissioners (NAIC).
The task force has excited insurance groups, producer groups and consumer groups by posting early draft revisions of the NAIC's Accident and Sickness Insurance Minimum Standards Model Act (Model 170) and the NAIC's Model Regulation to Implement the Accident and Sickness Insurance Minimum Standards Model Act (Model 171).
The NAIC is a voluntary trade group for state insurance regulators. In states that choose to adopt the NAIC's accident and sickness models, the models apply mainly to dental insurance, vision insurance, critical illness insurance, hospital indemnity insurance, short-term health insurance, travel medical insurance and other health-related products that fall outside the scope of the Patient Protection and Affordable Care Act (PPACA) major medical provisions and the major medical provisions in the Health Insurance Portability and Accountability Act of 1996 (HIPAA).
See also: 5 battles over the PPACA-free zone
The new proposed model revisions would exclude group supplemental products other than vision and dental products.
Efforts to increase sales of non-PPACA health products have been popular with insurers, agents and brokers that are leery of the underwriting restrictions and benefits mandates that PPACA has imposed on the major medical market.
In many cases, the non-PPACA products are the types of products that have been clashing with patient groups and consumer groups for decades. Commenting on the NAIC's accident and sickness model revision drafts has given the players a chance to restart old fights.
For a look at five things commenters are saying about the model revision drafts, read on.
1. The American Council of Life Insurers (ACLI): Leave disability insurance alone.
Some interested parties have suggested that regulators should carve disability insurance products out of the accident and sickness models and create a separate category of minimum standards just for them.
Steven Clayburn, a senior director at the ACLI, says the ACLI opposes that idea.
Over the years, drafters of state laws and regulations have assumed that "accident and sickness" standards would apply to disability products and have not always bothered to spell that out, Clayburn writes.
"To carve out disability income insurance from these minimum standards models into its own models would appear to be creating more work for states than has been contemplated," Clayburn says.
2. America's Health Insurance Plans (AHIP): The NAIC has enough health-related subgroups and work groups.
Cindy Goff, a vice president at AHIP, touches on many points in her comment letter. Like Clayburn, for example, she says any new NAIC accident and sickness models should keep disability insurance in the models.
Goff objects to proposals that the NAIC should start a subgroup to create new notice and disclosure requirements for accident and sickness products, or a new work group to set minimum benefit levels for accident and sickness products.
She also objects to the idea that the NAIC needs new teams to consider those proposals.
"Updating the current notices should not require the creation of a new subgroup," she writes.
3. AHIP: The current disclosure requirements for supplementary and voluntary products are fine.
PPACA requires issuers of major medical plans to provide standardized Summary of Benefits and Coverage (SBC) notices.
