By Sam Baker - 06/02/11 09:16 PM EDT
Rep. Mike Rogers (R-Mich.) has sponsored a bill to excude brokers’ commissions from insurers’ calculations. Trautwein testified Thursday that because agents are mostly self-employed and are hired by consumers, rather than insurance carriers, their commissions shouldn’t be considered administrative expenses.
Rep. Henry Waxman (D-Calif.) said brokers provide a valuable service but that carving out their commissions “in effect means increasing premiums and overhead expenses for the consumer.”
The National Association of Insurance Commissioners is debating whether to endorse the Rogers bill.
Three states — Maine, Nevada and New Hampshire — have received adjustments from the MLR rules. The healthcare law requires insurers to spend 80 percent of their revenues on medical costs but lets HHS modify that standard if imposing it immediately would destabilize the state’s insurance market.