In the health care reform law, there are new minimum medical loss ratios. The staff report indicates that the insurance industry is dealing with the impact of the new minimum medical loss ratio requirements, and some might shift administrative expenses to the category of medical expenses.

Chairman Rockefeller said about the report, "Given the industry's track record, the Commerce Committee will continue to monitor medical loss ratios for as long as necessary. And consumers can rest assured that our watchful eye will require health insurance companies to comply with the law by actually spending more money on patient care - not doing all they can to cut corners and cook the books."


Meanwhile, the House Energy and Commerce Committee canceled a hearing on health care reform and its effect upon large employers. The Hearing was to be held April 21. Chairs Rep. Henry Waxman (D-CA) and Rep. Bart Stupak (D-MI) stated in a letter to the Members of the Subcommittee on Oversight and Investigation that the cancellation is due to the request of several companies who had been invited to testify. These companies had asked for more time for the reform implementation to be performed before holding a hearing.

Waxman and Stupak state that several companies and their representatives feel that the new law "could have beneficial impacts on large employers if implemented properly." For example, John Castellani, president of the Business Roundtable, told the subcommittee's staff, "if implemented right, the law has the potential to make employers and employees better off because it could bend the cost curve."

Waxman and Stupak also note that the companies have acknowledged that they will be affected by many of the new law's provisions, some of which impose costs, e.g. ending the tax deductibility of the government subsidy for providing retiree prescription drug coverage. Other provisions, such as the coverage of the uninsured, may reduce employer health care costs. But in general, the stakeholder companies and associations don't feel at this time that they can accurately weigh the benefits and detriments of the law.

Waxman and Stupak conclude that the subcommittee will "closely monitor the implementation of the new law and will schedule hearings on the impact of the law as appropriate."

Finally, Senator John McCain (R-AZ) and other Senators are asking the Department of Health and Human Services' Inspector General Daniel R. Levinson some pointed questions regarding the potential for fraud and abuse in the new health care reform law. In a letter to Levinson, the Senators state, "We are gravely concerned that the loss and abuse of taxpayer dollars due to waste and fraud could increase under the new health law. We believe this concern is well placed, as our largest federal health care programs, Medicare and Medicaid, are already rife with waste fraud and abuse."

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