NAIC – Moving Forward on Consumer Protections in the ACA

I have good news for those of us who have been feeling something lacking in our lives lately. You know who you are. You’re deep into ACA implementation but the last few months you’ve felt a void…a sort of emptiness…. You’re just not feeling the love from our federal regulators, as you wait and wait and wait for those promised rules on exchanges, essential health benefits, actuarial value, and the 2014 market rules. They used to say the rules would be out “soon.” That was several months ago. Now they don’t even promise that – they just get a faraway look as they try to avoid your eyes. And “forget” to return your calls.

But – before you seek counseling to process those feelings of neglect, never fear. The National Association of Insurance Commissioners (NAIC) is stepping forward to fill the void – at least partially. Later today their “Regulatory Framework Task Force” is meeting to continue its process of developing model state laws to implement the ACA’s health insurance reforms, including the new prohibitions on health status discrimination and requirements that insurers accept all comers, even those with pre-existing conditions. They will consider and edit two draft model laws – one for the small group insurance market and one for the individual insurance market. Each draft includes the insurance market reforms scheduled to take effect on January 1, 2014 under the ACA, such as:

  • Guaranteed issue and renewal. Requires insurers to issue a policy to all applicants, regardless of health status or risk factors. Requires policies to be renewed, except in cases where the consumer has not paid premiums or moves out of the insurer’s service area.
  • Pre-existing condition exclusions. Prohibits insures from refusing to pay for treatment or services associated with a pre-existing condition.
  • Rating restrictions. Prohibits insurers from charging higher premiums based on health status or gender. Allows premiums to vary only based on family size, tobacco use, and age. Age rating is limited to 3:1.

The NAIC’s consumer representatives have commented extensively on these drafts and recently released a report with recommendations to help guide regulators and lawmakers in consumer-focused implementation of the 2014 reforms. The draft laws also include the ACA’s early market reforms (i.e., coverage for young adults up to age 26, prohibition on rescissions, etc.), which CHIR researchers recently found were being addressed in nearly all 50 states and the District of Columbia.

The Regulatory Framework Task Force is forging ahead, even though the feds haven’t yet issued their proposed rules to implement the new market rules. The issue is simple. States, insurers, and consumers need to know the rules of the road for the new health insurance marketplace. In the absence of any guidance from the federal government, the model state laws adopted by the NAIC will help state legislatures develop the necessary conforming legislation so that insurers know what the rules are and consumers can receive the full benefits of the ACA.

Be sure to check in with CHIRblog to stay posted on ongoing developments at the NAIC and much more in our series on “Implementing the ACA.”