Nobody's good at breaking bad news, though lobbyists might be worst of all. Amid all the post-election punditry, crickets were the only sound that could be heard on the subject of legislation that would carve out agent/broker compensation from the minimum medical loss ratio requirement under the Affordable Care Act.
If you’re looking to Congress to restore health insurance commissions to their pre-Obamacare days, you’re not going to be happy. Lobbyists can do much to influence the benefits marketplace for agents and brokers and clients, but rolling the president of the United States and the Senate majority leader aren’t on our can-do list.
Here’s the deal: Many provisions of the Affordable Care Act egregiously undermine the employer-sponsored health insurance market. None take such specific aim at brokers as the MLR ratio, which requires that health plans pay out most of their premiums for healthcare—80% for groups up to 100 employees and 85% for groups of more than 100. This means profits, administrative costs, and marketing costs all have to be contained within 15% to 20%. During legislative consideration of the act, some Democrats wanted the number to be 10%.
We and our allies within the agent/broker community went to work to exempt producer compensation from the MLR calculation. We found two excellent champions in the House of Representatives—Mike Rogers, R-Mich., and John Barrow, D-Ga.—to author legislation on the subject. In the Senate, we persuaded Mary Landrieu, D-La., and Johnny Isakson, R-Ga., to do the same. We lined up nearly 200 co-sponsors in the House. We created a perception that this was a winnable issue. After all, congressional Democrats may disdain insurance companies, but everybody tries to please insurance agents and brokers.
The effort, however, was predicated on the GOP reclaiming control of the Senate. This was a pretty good bet a year ago, as Democrats were defending 23 seats in the 2012 election and Republicans were defending only 10—in a lousy economy with a cranky electorate. When the dust settled on Nov. 7, though, Democrats had picked up two seats in the Senate.
Sure, it was a status quo election, but the Senate outcome was devastating—a combination of bad luck, political miscalculations, and a bevy of Tea Party–backed losers. Maybe the Lord was speaking to Todd Akin and Richard Mourdock, but He wasn’t leading them to victory.