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A central consumer protection in the health reform bill is set to take effect Jan 1: Health insurers will have to spend at least 80 cents of every dollar we pay in premiums on actual medical care. That means less money goes to executive salaries and paper-pushers whose only job is to deny you benefits, and more to pay the bills when you get sick. This has been one of the most talked-about provisions of the new law, and is a critical consumer protection that will help ensure we get the health care we pay for. 

How is it then that the health insurance industry is acting like regulations to implement the rule are coming out of left field?

The National Association of Insurance Commissioners is writing the first draft of rules for how insurers calculate their spending on health care, and they're just a week away from finalizing them after more than five months of debate. But yesterday, on a last-minute call that seemed to be arranged specifically to give insurers a platform to make their case, the industry made out as if they'd been ambushed.

Hardly. The insurance industry spent the last five months flexing its considerable lobbying muscle to water down the rules on health care spending. (As a side note they should really have to disclose how much money they're paying lobbyists to influence these regulations.) They've tried to label everything except the kitchen sink as medical care or improving health. I'm waiting for them to throw in the sink - after all, patients might take their pills there. Every overhead cost they falsely call health care spending is another dollar they shift to profit instead of spending it to make their customers well. Give the industry enough exclusions, and insurers can make it look like they're spending a whole lot more on health care without changing they way they do business at all. On yesterday's call, the same issues we've been debating for months were brought back as new concerns. 

The insurance industry has won and lost battles over this regulation, so it doesn't surprise me that they're still arguing for loopholes. It doesn't even surprise me that they're arguing for the same loopholes. But the indignation that the rules were moving too fast was completely disingenuous.

Insurance companies and their allies have been the overwhelming voice lobbying the NAIC during the drafting process. On yesterday's call, just one consumer rep, Tim Jost, got the Herculean job of rebutting four other speakers who were allotted time to attack the proposal from all sides. While this special call gave industry critics a platform to complain, consumer groups didn't get the same soapbox. And believe me when I say the regulation could use a lot of fixing from the consumer standpoint.

In addition to arguing for enough loopholes and exceptions to make the health spending requirements meaningless, insurers want the NAIC to step way outside
its legal jurisdiction and delay implementation of the rule entirely. They're yelling the sky is falling and hoping regulators will cave. Add to that an outrageous, barely-veiled threat by the speaker
from Aetna (representing the big five insurers including Cigna, UnitedHealthcare,
Humana and Wellpoint) that the industry will take the rules to court if it
doesn't get its way. HHS and regulators should call their bluff.