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Committee Chairmen Call for Health Care Law Waiver

August 04, 2011

Today U.S. Rep. Dave Camp (R-MI), Chairman of the House Ways and Means Committee and U.S. Rep. Fred Upton (R-MI), Chairman of the House Energy and Commerce Committee, wrote to Health and Human Services Secretary Kathleen Sebelius urging HHS to provide 340,000 consumers in Michigan’s individual health insurance market a waiver from the onerous medical loss ratio (MLR) requirements enacted under the Democrats’ health care law.  

The two Chairmen, whose committees share jurisdiction over health care, wrote that the health care law’s misguided MLR mandate violates President Obama’s long repeated promise that “if you like the plan you have, you can keep it.”  As a result, the waiver is necessary to provide a short-term reprieve from one of the law’s provisions that harm residents of Michigan.  Citing evidence provided by Michigan’s Office of Financial and Insurance Regulation (OFIR), the Chairmen noted that as many as eight companies in Michigan could either leave the market or significantly limit their plan offerings due to the law’s requirement that insurers be able to meet the 80 percent MLR threshold, creating a level of disruption that would quickly destabilize the market and threaten the ability of insurers to continue offering plans to Michigan residents.  

The Chairmen wrote:

“While approving Michigan’s application will not solve the fundamental flaws in the Democrats’ health care law, on behalf of Michigan constituents, we believe it is important to voice our strong support for steps that can limit the damage inflicted on consumers as a result of this misguided law.

“The federally imposed MLR requirements will reduce consumers’ ability to choose the health plan that best meets their needs and risks disrupting the health insurance coverage of tens of thousands of Michigan residents…

“In Michigan seven health plans insure almost 90 percent of consumers in the individual insurance market, totaling 305,003 people in 2010.  Based on 2010 data, only two of the seven health plans would be able to meet the 80 percent MLR threshold and combined the seven plans would have had a net estimated loss of $30.9 million in 2010 if forced to comply with the MLR requirements.”

Read the full text of the letter here.