Members of Congress and state insurance regulators are weighing whether to exempt agent and broker commissions from medical loss ratio calculation.
Under federal health reform insurers must spend 80 percent of individual and small-group premiums and 85 percent of large-group premiums on medical costs. Other expenses, including agent compensation must come from the administrative portion of medical loss ratio and is counted as a non-claims cost.
A House bill to exclude producer commissions from MLR formula has already been endorsed by a number of agent and broker groups. The bill, Access to Professional Health Insurance Advisors Act of 2011, was sponsored by Reps. Mike Rogers, R-Mich., and John Barrow, D-Ga.
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