As Senate debate on healthcare reform began, the bill being considered - before any amendments were offered - contained no provision to repeal the limited antitrust exemption under the McCarran-Ferguson Act for health insurers. Press reports indicated that conservative Sen. Ben Nelson (D-Neb.), a former insurance commissioner and NAIC official, got it removed before he agreed to support letting debate proceed. But on December 1, Sen Patrick Leahy (D-Vt.) filed the Health Insurance Industry Antitrust Enforcement Act of 2009 as an amendment to the Patient Protection and Affordable Care Act. The legislation, which is cosponsored by 18 Senators,would repeal the antitrust exemption for health insurance and medical malpractice insurance providers.

The ability of agents and brokers to continue to sell and service health insurance policies through the proposed health insurance exchanges was weakened. The initial bill preserves the ability of agents and brokers to participate, but then adds some troubling provisions that make us suspect some of the bill’s backers may want to exclude them at some point.

“Unlike the health care bill passed by the House, the Senate bill weakens the position of agents and brokers,” said PIA National Director of Federal Affairs Mike Becker, quoted in the National Underwriter’s article about the agent provisions. “It invests in one federal bureaucrat—the secretary of the Department of Health and Human Services—the authority to decree how much agents and brokers could be paid for selling policies offered through state exchanges.”

“It specifically allows for unlicensed individuals to serve as ‘navigators’ in competition with licensed agents and brokers,” Becker said. “PIA will work to have this bill amended to better protect the interests of agents and brokers.”

The bill stipulates that the HHS secretary is required under these provisions to “establish procedures under which a state may allow” (but is not required to permit) “agents and brokers to enroll individuals” in exchange plans. The bill also requires the secretary of Health and Human Services to promulgate regulations that would apply to the state exchanges to ensure that any Navigator “is qualified, and licensed if appropriate” [our emphasis added].

In addition, the bill indicates that the Secretary of Health and Human Services would have the authority to issue “rate schedules for broker commissions paid by health benefits plans offered through an exchange,” rather than permitting such commissions to be negotiated in the marketplace.

What It Means to Agents:  As this bill is debated, it will be open to amendment on the Senate floor. PIA will work to better protect the interests of agents and brokers. We will also work to prevent any repeal of McCarran-Ferguson.

Agents Cite Major Objections To Senate Health Reform Bill (National Underwriter 11/30)

NCOIL Passes Resolution to Preserve Agents’ Role in Health Insurance

December 2, 2009