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WellPoint, others may need relief from law's spending mandate

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The U.S. health overhaul’s mandate that insurers spend 80 percent of premiums on medical care may need to be loosened to keep companies from abandoning the market for people who buy coverage on their own, state regulators said.

Lowering the requirement in some states “may be desirable” at least until 2014, when other provisions in the health-care law will make it easier to find insurance, according to a draft report released Monday by the National Association of Insurance Commissioners. The group of state regulators is expected to send a final recommendation on the rules to U.S. officials by June 1.

The health law passed by Congress in March will force insurers, led by Indianapolis-based WellPoint Inc. and Aetna Inc. of Hartford, Conn., to give rebates to customers next year if companies don’t meet the medical-spending minimums. The commissioners’ draft report said the rule may be too strict for some individual policies, where marketing and administrative costs tend to be higher.

The disruption would depend on “the extent to which issuers would be unable or unwilling to meet the standards, and would therefore withdraw from the market and terminate existing policies,” the memo said. “In the worst case, this could lead to a lack of available coverage.”

Starting in 2014, insurance companies will be banned from denying customers based on their health, and states will open online “exchanges” to assist consumers in buying policies. Until those provisions begin to assist buyers, reducing the medical-cost requirement “in many states” may be the best solution, the report said.

The health-care legislation allows for the suspension of the 80 percent standard if it would destabilize the individual insurance market. The U.S. Department of Health and Human Services is expected to propose the final regulations later this year.

The memo, written by Rick Diamond, an actuary with the Maine Bureau of Insurance, said most insurers will meet the requirement for large- and small-group policies. Compliance will be easier because the law lets companies subtract state taxes on premiums while including as medical costs a range of “activities that improve health-care quality,” the memo said.
 

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  1. Really, taking someone managing the regulation of Alcohol and making himthe President of an IVY Tech regional campus. Does he have an education background?

  2. Jan, great rant. Now how about you review the report and offer rebuttal of the memo. This might be more conducive to civil discourse than a wild rant with no supporting facts. Perhaps some links to support your assertions would be helpful

  3. I've lived in Indianapolis my whole and been to the track 3 times. Once for a Brickyard, once last year on a practice day for Indy 500, and once when I was a high school student to pick up trash for community service. In the past 11 years, I would say while the IMS is a great venue, there are some upgrades that would show that it's changing with the times, just like the city is. First, take out the bleachers and put in individual seats. Kentucky Motor Speedway has individual seats and they look cool. Fix up the restrooms. Add wi-fi. Like others have suggested, look at bringing in concerts leading up to events. Don't just stick with the country music genre. Pop music would work well too I believe. This will attract more young celebrities to the Indy 500 like the kind that go to the Kentucky Derby. Work with Indy Go to increase the frequency of the bus route to the track during high end events. That way people have other options than worrying about where to park and paying for parking. Then after all of this, look at getting night lights. I think the aforementioned strategies are more necessary than night racing at this point in time.

  4. Talking about congestion ANYWHERE in Indianapolis is absolutely laughable. Sure you may have to wait in 5 minutes of traffic to travel down BR avenue during *peak* times. But that is absolutely nothing compared to actual big cities. Indy is way too suburban to have actual congestion problems. So please, never bring up "congestion" as an excuse to avoid development in Indianapolis. If anything, we could use a little more.

  5. Oh wait. Never mind.

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