The health care reform bill passed by the Senate on Christmas Eve includes several improvements advocated by the organizations that represent insurance brokers and advisers in Washington. For the most part, however, those groups remain opposed to the Senate bill — and more so the version approved by the House.

Officials at these organizations — including the National Association of Health Underwriters, the Council of Insurance Agents & Brokers, the Independent Insurance Agents & Brokers of America (Big I) and the National Association of Insurance and Financial Advisors — cite as one of the most important victories the elimination of a provision that would have granted the Secretary of Health and Human Services the power to set commissions for brokers selling in state exchanges. “That provision was particularly onerous,” says Joel Wood, senior vice president of government affairs at CIAB.

Another change in the bill lowered the medical loss ratio from 90% in an earlier draft to 80% for small groups and 85% for large groups. “We’d like to see some further improvement in that ratio, but the 80% and 85% ratios are a step in the right direction,” says Charles Symington, senior vice president of government affairs at the Big I.

In the view of many officials, the public option is “the big enchilada,” and they are pleased that it was dropped from the Senate bill. “That’s something we spent a lot of time on, and other groups did the same,” says Symington.

Other pieces of good news in the Senate bill, according to industry reps, include:

  • * It does not repeal the McCarran-Ferguson Act antitrust exemption for insurers.
  • * The annual cap on flexible spending account contributions is now indexed for inflation.
  • * ERISA protections remain intact.

Nonetheless, the bill still has many downsides, the stakeholders agree. “We worry that there are too many open invitations for employers to scale back or drop coverage,” says CIAB’s Wood. “The insurance market reforms are flawed and will force millions of Americans to pay significantly more for health coverage. We have no problem with subsidies for people who are under-insured or uninsured, but this legislation doesn’t bend the cost curve.”
Adds Diane Boyle, HIA, vice president with NAIFA: “NAIFA’s reform goals have been and continue to be ensuring affordable coverage for all Americans without resorting to new government programs. NAIFA will remain actively engaged and will attempt to further improve the legislation to meet these goals including efforts to remove the new government long-term care program and to further address affordability and sustainability of private insurance choices.”

The Senate bill passed on a 60-39 party-line vote — all Senate Republicans voted against it (save Jim Bunning (R-Ky.), who was absent due to “family commitments”), while all Democrats and Independents voted for it.

Among other things, the bill reflects hostility toward the insurance industry expressed by congressional leaders. “We’re standing up to the greedy insurance companies that deny coverage to the sick,” declared Senate Majority Leader Harry Reid (D-Nev.) after the Dec. 24 vote.

The 2,000-plus page bill now must be reconciled with its House-passed counterpart by a joint House-Senate conference committee. According to news reports, the conferees, consisting of the Democratic leaders of the House and Senate, along with White House chief of staff Rahm Emanuel, will begin their work when Congress returns from their holiday break in early January.

The conferees are expected to meet behind closed doors and face a daunting task — there are significant and highly charged differences between the bills, including provisions regarding abortion coverage, a government-run health plan, an employer mandate and various taxes. Their goal is to hash out a final version of the bill, which must be approved by both houses of Congress, before the president’s State of the Union address Jan. 20.

For their part, though, Senate Republicans will continue their efforts to derail the bill. “This fight is long from over,” vowed Senate Minority Leader Mitch McConnell (R-Ky.) after the vote. “My colleagues and I will work to stop this bill from becoming law.”

This article, written by the editorial staff of Employee Benefits Adviser, was originally posted at

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