Groups blast NAIC health plan conduct report delay

The people who speak for consumers at the National Association of Insurance Commissioners are furious about an effort to postpone the first due date for a new market conduct reporting form by three months.

NAIC, a Kansas City, Missouri-based group for state insurance regulators, is holding one of its quarterly in-person meetings in San Diego this week. NAIC's executive committee and its plenary, a body that includes all voting NAIC members, may vote on adding the health market conduct report to the health line of business reporting process at a session Monday.

In the insurance industry, "market conduct" refers to how an insurer treats consumers when it is marketing its products, evaluating applications for coverage, making sales and servicing in-force coverage.

NAIC has spent years developing a new Health Market Conduct Annual Statement, a form that's supposed to collect detailed information about everything from how many enrollees an insurer still has in the "grandfathered" health insurance policies written before the Affordable Care Act came along, to how often the insurer denied claims for in-network care, to how often the insurer took longer than 90 days to pay claims.

The forms could help answer many questions insurance agents and others have had about the effects of the ACA on the U.S. commercial health insurance market, such as how many people have rich platinum-level coverage, how many people have bare-bones bronze-level coverage, and how the claim costs of enrollees with platinum-level coverage compares with the claim costs of enrollees with bronze-level coverage.

Consumer represenatives say any reporting delay will reduce regulators' ability to protect consumers. (Image: Thinkstock)

Reps question deliberation process

NAIC cannot directly set insurance laws or regulations, but U.S. states and territories often adopt NAIC models as is, or adopt the models with minor changes. Some states and territories have laws in place that apply NAIC reporting rule updates to the insurers they regulate automatically.

NAIC has decided that insurers should file their first wave of health market conduct statements in 2018, using data for the 2017 benefits year.

Members of NAIC's market regulation and consumer affairs committee voted June 3, during a conference call meeting, to postpone the due date for the 2017 health market conduct reports to Sept. 30, 2018, from the original due date of June 30, 2018.

NAIC's consumer representatives — the people picked by NAIC to speak for consumers in NAIC proceedings — have written to say that the market regulation committee postponed the 2017 health market conduct report due date without giving the public adequate notice.

"We cannot stress enough the importance of timely adoption of the Health MCAS to ensure reporting of 2017 experience in 2018," the consumer representatives wrote in a letter sent to NAIC's executive committee and to its plenary, the body that includes all voting members of NAIC. "Any delay in adopting the Health MCAS will result in at least the loss of a year's worth of health data for market analysis."

Health insurers need access to the data to protect consumers, the representatives say.

In a presentation for another session, the consumer representatives say many health plan enrollees feel as if the process for resolving complaints is like a maze.

After the end of a phase-in period, the health market conduct statement is supposed to be April 30, the reps add.

Adopting the market regulation committee's change "will set a terrible precedent," the representatives say. "It appears that industry was rewarded not for making a reasoned case in the normal public process, but for lobbying commissioners outside of the NAIC process. Whether this is accurate or not, the message to industry is that they can achieve success by setting up their issues in private conversations with commissioners and avoiding the public review of their proposals by simply not making any comments during the public comment period."

NAIC to Upgrade Market Conduct System

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