Insurance Commissioners Try to Define What Constitutes Medical Care

In a follow up to last week’s story on a gathering of Insurance Commissioners meeting in Seattle to determine what constitutes “medical care,” the same media outlet as last time, The Palm Beach Post, has a story entitled, “Patients win first round: Define health care costs with emphasis on care, not profit.” The commissioners filled out the guidelines in the form of “blanks,” which are documents that insurers must file listing all of their expenses so the government can determine the companies’ medical loss ratio. If you recall, the MLR is the portion of money that goes to patient care rather than administrative costs and salaries.

The Affordable Care Act requires that companies maintain an MLR of at least eighty percent in small groups and eighty-five percent in large groups of individually insured customers. While certain commissioners didn’t support The Affordable Care Act, they agreed that customer care and quality of service should take precedent over administrative costs, and in a pleasantly surprising move, released guidelines that are very supportive of their patients.

While commissioners said larger health insurance companies already have am MLR of eighty-to-ninety percent, but smaller companies are still around sixty or seventy percent, if that, and they hope their guidelines indeed make health insurance more accessible. They also didn’t include things like quality control and other administrative costs in their definition of billable medical care. There are critics though. The CEO of America’s Health Insurance Plans, Karen Ignagni, said the commissioners’ proposal “could have the unintended consequence of turning-back-the-clock on efforts to improve patient safety, enhance the quality of care, and fight fraud.”

While this is a valid concern, it’s good to see commissioners taking the time to lay out guidelines that benefit patients rather than companies. Now we’ll see if the Department of Health and Human Services ratifies the guidelines, and if so, where they take them from here. We’ll keep an eye on this interesting story in the future and report back on changes or updates.