Duke de Haas “blogs” from the NAIC meetings in New Orleans, LA
1. Hurricanes (or Tornadoes)
The severe weather across the Midwest was a grim reminder of the importance of the insurance industry to the lives of everyone in America. As the National Association of Insurance Commissioners (“NAIC”) attendees listened to the wife of South Dakota Insurance Director Merle D. Scheiber sing the National Anthem in New Orleans, the recent tornadoes across the south and Midwest, as well as Louisiana Insurance Commissioner Jim Donelon’s opening remarks regarding Hurricanes Katrina and Rita in 2005, reminded everyone of how important insurance is to all of our lives. As the NAIC meetings progress, and as industry and regulators grapple with national and international issues, the weather helped remind everyone of the importance of keeping the focus squarely on how insurance affects all facets of our lives.
2. Missing in Action
The weather caused the absence of Missouri Insurance Director John Huff. As the representative of the NAIC to the Financial Stability Oversight Council, Director Huff’s absence seemed to leave a void as far as the states’ link to Washington, DC. It was not the only void, however, as the Federal Insurance Office’s (“FIO”) failure to release its long-awaited report on the state of insurance regulation in the United States passed the one-month mark. While the states often used the word “partnership” in discussing their relationship with the federal government, there are undoubtedly a number of states who wait for the report with a mixture of anticipation and dread. Perhaps to fill the vacuum, the NAIC issued its interactive annual report entitled “The Home of U.S. Insurance Regulation” during the conference.
3. Soon’s the Word
The NAIC hosted a second Health Insurance Exchange Forum the day before the NAIC meetings officially began, and the opening day of the NAIC meetings included a meeting of the Health Insurance and Managed Care (B) Committee Exchanges Subgroup. However, despite the presence of US Department of Health and Human Services (“HHS”) and US Center for Consumer Information and Insurance Oversight (“CCIIO”) officials, the answers received by many state insurance regulators to their detailed questions on provisions of the Patient Protection and Affordable Care Act and accompanying regulations were generally vague and inconclusive. As the word “soon,” became a four-letter word in more ways than one, it has become readily apparent to a wider audience that the complexity of the federal health care reform law is slowing down the pace of change at all levels of government. The clarity that industry, regulators, and consumers need will hopefully be arriving “soon.”
4. G is for Global
The financial services industry has always seemed to be several steps ahead in the globalization race, but the NAIC meetings increased focus on international issues, as well as the increased interest, are impressive to behold. Whether due to the natural course of events, the pressures brought about by industry, threatened federal legislation, or the new FIO, the NAIC and the states appear to be increasingly focused on international insurance issues, which is good news for the industry and consumers in the US and around the world. With former NAIC President and Iowa Insurance Commissioner Susan Voss leading the charge (with poems to boot), the quiet work done by the late Virginia Insurance Commissioner Al Gross and others appears to be coming to fruition.
5. New Blood
State insurance regulators welcomed several new members to their ranks, including Andrew Boron, the new Director of the Illinois Department of Insurance, who was recently appointed by Illinois Governor Pat Quinn. Also, Ken Kobylowski was nominated by New Jersey Governor Chris Christie to be Commissioner of the New Jersey Department of Banking and Insurance. In Oregon, Lou Savage was appointed acting Administrator of the Oregon Division of Insurance, replacing Teresa Miller, who moved on to bigger, if not better, things as a CCIIO senior adviser. Additionally, Gwen Fuller McGriff was appointed to serve as acting Director of the South Carolina Department of Insurance, and last, but not least, Sixto Igisomar was confirmed as the Northern Mariana Islands Secretary of Commerce, with responsibilities including banking and insurance.
6. Washington Update
In addition to the usual excellent update provided by NAIC staff, state regulators and guests heard from Senator David Vitter (R-LA) at the NAIC Government Relations Leadership Council meeting on the situation in Washington, DC. While little seems to be moving in the current environment of partisanship and election year fever, he stated that the Republicans were focused on Dodd-Frank rollback and government sponsored enterprise reform. He seemed somewhat more optimistic about the chances of reauthorization of the national flood insurance program occurring this year. Two questions from the insurance commissioners were noteworthy. First, Commissioner Susan Voss from Iowa requested that the folks in Washington become less bank-centric in their decision making on systemic risk and other associated issues. Second, and perhaps more ominously for the normally polite atmosphere that reigns at most NAIC meetings, Commissioner John Doak of Oklahoma mentioned a resolution he is circulating that would state the NAIC’s objection to certain recent contraceptive coverage decisions made by the Obama administration.
7. Resolution Fails to Get Past First Base
On March 6, 2012, the final day of the conference, the last item on the Joint Executive (EX) Committee and Plenary agenda was a resolution presented by Oklahoma Insurance Commissioner John Doak. The resolution was drafted to be an NAIC resolution and would have provided that “The NAIC cannot support any legislative action that would deny citizens constitutionally protected religious rights.” The resolution appeared to be a reaction to HHS’ recent decision to require most health insurance plans to cover preventive services for women, including recommended contraceptive services, without charging a co-pay, co-insurance or a deductible, despite the outcry from a number of organizations that such requirement impinged on religious freedom. Those expecting a hearty debate on the proposed resolution from the insurance commissioners, however, were disappointed. When Commissioner Donelon (sitting in the absence of NAIC President and Florida Insurance Commissioner Kevin McCarty) asked for a second on Commissioner Doak’s motion to consider the proposed resolution, the cavernous room became silent. Hence, the resolution failed.