Keeping Insurance Agents and Brokers’ Commissions in the Medical Loss Raito

Bonnie Burns, our Training and Policy Specialist, Stephen Finan and several other advocates serving as consumer representatives with the National Association of Insurance Commissioners (NAIC) co-authured an article urging the NAIC not to endorse legislation that would remove broker and agent commissions from the medical loss ratio (MLR). This is a calculation that has the potential of giving consumers valuable insights about the proportion of their premiums spent on health care costs and improving quality of care compared with administrative expenses, including high salaries and bonuses. The health care reform law requires that 80-to-85% of the money collected by insurance companies be spent on health care services and health care quality improvement. Insurance companies have until next year to comply with this requirement.

Burns and other advocates voice their concern that removing broker and agent commissions would skew the accuracy of this ratio. It would have far-reaching implications for the reliability of the MLR as a measure of a health plan’s value, for the broader goal of improving quality and controlling costs, and for the NAIC itself.

Read the article, “For the NAIC, A Consequential Decision on the MLR (Guest Opinion)” for more details.

Also see the website for more information on the MLR.

Karen Joy Fletcher

Our blogger Karen Joy Fletcher is CHA’s Communications Director. With a Masters in Public Health from UC Berkeley, she is the online “public face” of the organization, provides technical expertise, writing and research on Medicare and other health care issues. She is responsible for digital content creation, management of CHA’s editorial calendar, and managing all aspects of CHA’s social media presence. She loves being a “communicator” and enjoys networking and collaborating with the passionate people and agencies in the health advocacy field. See her current articles.