Printed from BusinessInsurance.com

Insurance agents disappointed by health care reform law ruling

Posted On: Jun. 28, 2012 12:00 AM CST

Insurance agents disappointed by health care reform law ruling

WASHINGTON—Some groups representing insurance agents expressed disappointment with the Supreme Court's decision to uphold the Patient Protection and Affordable Care Act.

“The Big 'I' is disappointed with the U.S. Supreme Court's decision to uphold the PPACA,” Robert Rusbuldt, president and CEO of the Alexandria, Va.-based Independent Insurance Agents & Brokers of America, said in a statement. “Our association, economists and other industry leaders and experts agree that many of the provisions in the PPACA are causing more harm than good.”

The association said it will continue working with Congress to repeal portions of the law, such as the medical loss ratio provision of the law that remains intact with the high court's ruling.

Under the health care reform law, health insurers must spend at least 85 cents of every premium dollar collected on health care in the large-group market and 80 cents in the individual and small-group markets.

Agent and broker groups have tried to have their commissions excluded from the requirement, and the National Assn. of Insurance Commissioners late last year bolstered its case with a recommendation that the commissions be carved out.

“The PPACA's MLR provisions threaten the livelihoods of health agents and brokers and establish perverse incentives that make it challenging for smaller insurers to enter the marketplace,” said Charles Symington, the group's senior vp-government affairs.

“These MLR requirements have produced cuts in agent compensation of up to 50% in some areas of the country” and made it challenging for agents to provide quality service “at a time when such assistance is needed more than ever,” he said.

%%BREAK%%

The Alexandria. Va.-based National Assn. of Professional Insurance Agents also expressed disappointment with the decision.

“It is unfortunate that the Supreme Court upheld a bill that has been widely criticized by the public and the insurance industry,” Andrew C. Harris, president-elect of the association, said in a statement. “We urge all states to now deal with the issue of insurance exchanges in a manner that guarantees the right of insurance consumers to rely on the expertise of licensed professionals as they make important decisions about their health insurance coverage.”

Deciding vote surprising

The president of the Washington-based Council of Insurance Agents & Brokers looked toward the November elections.

“The decision today was extremely surprising to all insofar as Justice (Anthony) Kennedy was not, in fact, the deciding vote, and Chief Justice (John) Roberts was,” council President Ken A. Crerar said in an email. “In the end, however, it is clear that the issues surrounding the Affordable Care Act will be resolved in the November elections.”

Read the Supreme Court's entire decision.

PLUS: Read Business Insurance's complete coverage of the Supreme Court health care decision.