Understandably, there has been a lot of concern and many questions and a bunch of worry over the NAIC’s recent decision to not make a pronouncement in its current recommendations about how NAIC thinks agents commissions should be treated for the purposes of a carrier complying with the new medical loss ratio requirement.
As the new preacher told his elders, I can preach it flat or I can preach it round. That’s one of the cosmic niceties about legislation — there can be different interpretations of one relatively simple statement. On this commission and MLR issue, that agents commissions were not addressed in the NAIC recommendations may not necessarily be bad. or good. We all know there are lots more innings left in this game, quarters left to be played, cheap beer to be swilled, jokes to be told, analogies to be conjured up, so it’s probably premature to speculate.
Lots of times in legislation it’s good when a bill or an administrative rule is silent on a matter — that gives the world maximum wiggle room. OR a huge gray area that is left up to debate. Which of those it is for someone depends on what side of the question he is on.
I sometimes prefer silence, to a hardcore declaration, which, in this case, could have been bad for agents and brokers. in the absence of some definitive statement or recommendation going back to the administration on this matter and if that’s really how the tea leaves ultimately are read, CMS might end up making the call or it possibly could end up back in Congress.
Another possibility is also that the question could be left up to each state, at the regulatory and legislative levels. i really don’t mind that possibility, as TAHU has a good chance of being persuasive at those venues — especially if all TAHU members are fully engaged. i always prefer for austin to call the shots, versus washington.
Let me share a philosophical story about Sherlock Holmes and Dr. Watson that is just like the question on pass-throughs.
“I see millions of stars, Holmes,” says Watson.
“And what do you conclude from that, Watson?”
Watson thinks for a moment. “Well,” he says, “astronomically, it tells me that there are millions of galaxies and potentially billions of planets. Astrologically, I observe that Saturn is in Leo. Horologically, I deduce that the time is approximately a quarter past three. Meteorologically, I suspect that we will have a beautiful day tomorrow. Theologically, I see that God is all-powerful, and we are small and insignificant. Uh, what it does it tell you, Holmes?”
“Watson, you idiot! Someone has stolen our tent!”
It just depends on how you look at it. at least for now.
-Lee Manross is the registered lobbyist for TAHU.