The National Association of Insurance Commissioner (NAIC) is a self-regulatory body comprised of state insurance regulators from virtually every U.S. jurisdiction. The NAIC closely monitors the marketplace, the insurance industry, and legislation pending in the various state legislatures. State regulators serve on various committees and task forces and propose model legislation and regulations that states are required to adopt within a certain period for each state to receive NAIC accreditation. The NAIC announced its agenda for 2018. Below is an excerpt from that agenda, which addresses senior issues and outlines NAIC initiatives and goals relating to the senior segment of our population.
In 2018, the Senior Issues (B) Task Force will:
- Develop appropriate regulatory standards and revisions, as necessary, to the NAIC models, consumer guides, and training material on Medicare supplement insurance, senior counseling programs, and other insurance issues that affect older Americans.
- Continue to monitor and work with federal agencies to advance appropriate regulatory standards for Medicare supplement and other forms of health insurance applicable to older Americans.
- Review the Medicare Supplement Insurance Minimum Standards Model Act (#650) and the Model Regulation to Implement the NAIC Medicare Supplement Insurance Minimum Standards Model Act (#651) to determine if amendments are required due to federal law changes, and revise if necessary.
- Monitor the Medicare Advantage and Medicare Part D marketplace; assist the states, as necessary, with regulatory issues; and maintain a dialogue and coordinate with the U.S. Centers for Medicare & Medicaid Services (CMS) on regulatory issues, including solvency oversight of waived plans and agent misconduct.
- Monitor and assist the states in the implementation of changes to Model #651 to modernize the Medicare supplement market, as approved by the NAIC membership in March 2007 and as required by the federal Medicare Improvement for Patients and Providers Act of 2008 and the federal Genetic Information Nondiscrimination Act of 2008.
- Continue to monitor the changes in the Medicare supplement insurance market and assist the states with implementation of amendments to Model #650 and Model #651 due to federal statutory changes.
- Provide the perspective of state insurance regulators to the U.S. Congress, as appropriate, and CMS on insurance issues, including those concerning the effect and result of federal activity on the senior citizen health insurance marketplace and regulatory scheme.
- Review and monitor state and federal relations with respect to senior health care initiatives and other impacts on the states. Work with federal agencies as appropriate.
- Work with CMS to revise the annual joint publication Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare.
- Monitor developments concerning the State Health Insurance Assistance Programs (SHIPs), including information on legislation impacting the funding of SHIPs; provide assistance to the states with issues relating to SHIPs; support a strong partnership between SHIPs and CMS; and provide the perspective of state insurance regulators to federal officials, as appropriate, on issues concerning SHIPs.
- Assist the states and serve as a clearinghouse for information on Medicare Advantage plan activity.
- Monitor and maintain, in accordance with changes to Model #651 approved by the NAIC membership in March 2007, a record of state approvals of all new or innovative benefits in Medicare supplement insurance for use by state insurance regulators and others.
- Review, in accordance with changes to Model #651, approved by the NAIC membership in March 2007, state-approved new or innovative benefits, and consider whether to recommend that they be made part of standard benefit plan designs in the model regulation.
- Develop appropriate regulatory standards and revisions, as necessary, to the NAIC models, consumer guides, and training material on long-term care insurance. Work with federal agencies as appropriate.
- Continue to study and evaluate evolving long-term care insurance product design, rating, suitability, and other related factors. Review the existing Long-Term Care Insurance Model Act (#640) and the Long-Term Care Insurance Model Regulation (#641) to determine their flexibility to remain compatible with the evolving delivery of long-term care services and changing long-term care insurance marketplace.
- Monitor and provide assistance to the states on the implementation of the 2000 and 2014 amendments to Model #641 related to rating practices, as well as the model bulletin adopted by the NAIC membership in December 2013 regarding alternative filing requirements for long-term care premium rate increases.
- Examine whether there is anything the NAIC can or should do to address possible long-term care insurance reserve deficiencies and rating issues, such as mitigation against rate increases and death spirals.
- Explore options, in line with the current Model #640 and Model #641, where appropriate, and monitor efforts to ensure the fair or equal treatment of policyholders, including those in situations where policyholders live in multiple states.
- Examine how regulators should treat the spin-off or transfer of closed blocks of long-term care insurance business to another entity, including process issues related thereto.
- Examine examples of health-related financial exploitation of seniors and work with other NAIC committees, task forces and/or working groups on possible solutions.
The Long-Term Care Benefit Adjustment (B) Subgroup will:
- Determine what contractual authority is required to make a benefit change to a long-term care insurance policy, including as an alternative to a rate revision.
- Evaluate whether reduction of daily benefits, upon the elimination of inflation protection pursuant to a contractual provision, is reasonable.
- Evaluate the sufficiency of disclosure requirements associated with policy provisions to reduce benefit amounts.
- Determine what actuarial equivalence is appropriate for benefit change proposals and recommend related disclosure improvements.
The Long-Term Care Innovation (B) Subgroup will:
- Examine the future of financing long-term care given the significant impact of long-term care costs on state budgets through state Medicaid programs, including an assessment of the role the private market should play.
- Review the number of alternative product structures being developed and, in some cases, sold by companies (e.g., long-term care/life combination products, term products, and universal long-term care policies). Consider whether these are viable alternative products and what other types of products may assist in financing long-term care costs. This does not include an examination of rating issues facing the legacy long-term care insurance products.
- Examine whether amendments are needed to current NAIC models and/or regulations, whether there is a need for new models or regulations to accommodate a changing market, or whether federal action may be necessary and should be encouraged.
- Discuss the legal and regulatory barriers that may need to be overcome to improve the functioning of the private long-term care insurance market to assist in financing long-term care needs.
- Consider the pricing issues with any potential new long-term care financing products and whether the pricing of these products create a stable market.
- Work with private insurance companies, consumers, and consumer advocates about the future role of insurance in financing long-term care given the history of long-term care insurance over the past few decades, including the role they see for the private market and the types of products that are most appealing to them.
The Short Duration Long-Term Care Policies (B) Subgroup will:
- Create a model to address long-term care (LTC) products of short duration that are excluded from Model #640 and Model #641 but do not quite fit under the Accident and Sickness Insurance Minimum Standards Model Act (#170) and the Model Regulation to Implement the Accident and Sickness Insurance Minimum Standards Model Act (#171).
The Long-Term Care Shopper's Guide (B) Working Group will
- Revise and update A Shopper's Guide to Long-Term Care Insurance.
Bressler’s Insurance Practice Group regularly participates in NAIC meetings and events and is closely monitoring senior protection issues. Questions could be directed to Cynthia J. Borrelli or Michael Morris.