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The National Association of Insurance Commissioners has adopted model language designed to provide guidance to individual states establishing health insurance exchanges as required under health reform.
The Department of Health and Human Services has issued guidance for the exchanges’ technology platforms “to make them simple and seamless in identifying people who qualify for tax credits, cost sharing reductions, Medicaid or the Children's Health Insurance Program (CHIP).”
As for the model legislation developed by NAIC, the intent was not to provide a rigid, one-size-fits-all structure for how to establish the exchanges, but rather a broad framework under which state legislatures can start to move the process forward while taking into account the breadth of state regulations and laws, officials said.
“It is important for us to provide this model in time for 2011, as not all state legislatures are in session every year, but it is a year when all will be in session,” said Michael T. McRaith, director of the Illinois Department of Insurance. “What we do not attempt to do with the model law is reconcile the conflicting public policy decisions that individual states will have to make. We want to assure maximum state flexibility."
According to Rosemarie Day, president of Day Health Strategies and former deputy director and COO of the Commonwealth Health Insurance Connector Authority, the insurance exchange set up in Massachusetts, it’s imperative that states get their efforts under way in 2011 in order to meet the Jan. 1, 2014 deadline.
“The reality is that state exchanges need to be operational by mid-2013, and there’s so much IT work and market coordination to do, state exchanges will need as much time as possible to complete this,” Day said. “They can’t get started without state legislation, so the sooner the better.”
The HIE model framework was passed during a conference call of the NAIC Executive Committee. The NAIC intends to draft similar model legislation for multi-state and regional insurance exchanges in early 2011.
Other measures passed during the conference call included:
• Model language to assist states as they bring their laws into compliance with regard to early implementation provisions of federal healthcare reform;
• The Rate Filing Disclosure Form and Project Summary and Standard Definitions and Summary of Benefits Coverage that gives additional guidance to the Department of Health and Human Services as it implements provisions of healthcare reform;
• An updated model bulletin on the Use of Retained Asset Accounts to ensure consumers are protected and that these types of settlements are appropriately used; and
• The revised Insurance Holding Company System Regulatory Act and Insurance Holding Company System Model Regulation with Reporting Forms and Instructions that collectively provides state regulators with important new tools for evaluating risks within insurance groups.
These measures are in addition to the work NAIC had completed over past year, during contentious debates surrounding medical loss ratio and its recommendations to the Department of Health and Human Services.
“Our work is a fitting capstone to a year of tremendous effort and collaboration,” said Jane L. Cline, NAIC president and West Virginia insurance commissioner. “The work we have done in healthcare, recommendations on the use and disclosures for retained asset accounts and changes to the Holding Company Model Act demonstrate this organization’s commitment to consumer protection within the context of stable markets and effective regulation.”
