Newly proposed federal rules require certain insurers to disclose what they pay agents and brokers who help people select health insurance and share data on air ambulance services.
The first part of the proposed rules focuses on the compensation insurers provide their brokers.
Brokers help consumers and employers navigate the health plan options available to them and select one that works for their needs. In turn, payers pay brokers a commission, ranging from about $25 in Minnesota to less than a dollar in Virginia for brokers in the individual market, according to 2020 data from the Kaiser Family Foundation. Some experts believe this can influence the plans that brokers recommend.
If finalized, the new rules, proposed by Departments of Health and Human Services, Labor and Treasury, along with the Office of Personnel Management, would mandate that insurers offering individual and short-term, limited-duration coverage must disclose to policyholders the rates they pay to brokers.
The rules also include a provision requiring the above-mentioned payers to report to HHS the total amount of direct and indirect compensation they paid to brokers for the preceding year.
The second part of the proposed rules requires payers and providers of air ambulance services to submit data for each air ambulance claim they receive or submit.
Air ambulance services are a common root cause of large and unexpected medical bills. In about 69% of instances where privately insured patients used air ambulance transport in 2017, the provider of the transportation was out-of-network resulting in thousands of dollars in fees, according to a 2019 study by the Government Accountability Office.
“The air ambulance industry is a highly consolidated market that often leads to surprise bills for patients,” said HHS Secretary Xavier Becerra, in a news release. “Today’s proposed rules are part of the Biden-Harris Administration’s agenda to protect patients from unreasonably high costs and make healthcare more affordable.”
The government plans to use the data collected on air ambulance services to produce a publicly available report that “is expected to help shed light on the drivers of the high costs of these services,” according to a fact sheet released by HHS’ Centers for Medicare & Medicaid Services.
If finalized, the broker rate disclosures and air ambulance reporting requirements would generally apply to contracts executed after Dec. 27.
The comment period for the proposed rules extends until Oct. 18.
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