/PRNewswire -- As the insurance industry lobbies state insurance commissioners in Orlando to weaken modest regulations on health insurance premiums, Consumer Watchdog's leaders reiterated their call for President Obama to place a moratorium on premium increases, articulated this week in a Los Angeles Times op-ed.
"Health insurance companies have declared war on President Obama's healthcare plan," argues Consumer Watchdog President Jamie Court, author of "The Progressive's Guide To Raising Hell." "The struggling middle class cannot afford more double-digit premium hikes, and federal law says we are owed an explanation before having to pay them. Obama should forbid premium hikes until the companies comply with pricing provisions of the new federal law."
Read the Los Angeles Times op-ed calling for an executive order freezing rates: http://www.consumerwatchdog.org/patients/articles/?storyId=36580
On Thursday, the National Association of Insurance Commissioners is expected to take a final vote on new health reform rules requiring insurers to spend at least 80-85% of consumers' premiums on health care. State regulators continue to discuss how much information health insurance companies must disclose about unreasonable premium increases.
The insurance industry is pushing a series of last-minute amendments at the meeting of the National Association of Insurance Commissioners this week that would weaken regulation under the health reform law, including measures that would allow them to:
- Maintain low spending on health care in some states if they spend a higher percentage in other states. This "aggregation" of medical spending across states will nullify the new medical spending rules for the very consumers they are meant to help - those whose insurance plans spend too much on administration and profits.
- Artificially boost the amount that insurers report spending on medical care. "Credibility" adjustments are meant to account for fluctuations in health care spending for plans with fewer customers by increasing the reported medical loss ratio. Insurance companies' proposal could allow insurers to get away with intentionally low medical spending, said Consumer Watchdog.
- Falsely identify administrative costs – including broker commissions, fraud prevention, claims handling and denials – as medical spending.
Public scrutiny of unreasonable premiums is the health reform law's only check on rate increases. However, because regulations are still being written, insurance companies are not currently justifying unreasonable increases. President Obama has the obligation to issue an Executive Order freezing premiums until insurers begin complying with the law, said Consumer Watchdog.
"Insurance commissioners have a choice. Send the current modest version of medical spending regulations to HHS, or give insurers free rein to continue spending too much money on bloated profits and paper-pushers and not enough on actual health care," said Carmen Balber, Washington DC director for Consumer Watchdog. "In the meantime, insurers rush to raise premiums now just in case they have to rein in spending tomorrow. President Obama has the power to protect consumers from arbitrary price hikes by freezing premiums until insurers explain how they're spent in the full light of day."
Insurance companies have lobbied to limit the information made public in the rate justification considered by state regulators today. Consumer Watchdog argued for more disclosure to explain how insurers spend customer premiums, including:
- Lobbying expenditures and campaign contributions;
- Advertising and marketing expenditures; and
- Transactions and transfers of funds to affiliates.
Showing posts with label regulations. Show all posts
Showing posts with label regulations. Show all posts
Wednesday, October 20, 2010
Wednesday, July 28, 2010
What Happens Now? Questions on the Passage of the Dodd-Frank Financial Bill
/PRNewswire/ -- The following statement is attributed to Tom O'Grady, CEO, Pro Teck Valuation Services.
Pro Teck Valuation Services applauds the passage of the Dodd-Frank Financial Bill. It incorporates the best of HVCC, provides overdue protections to consumers and limits the financial exposure firms can maintain while investing.
Now comes the hard part.
During the next 90 days the Comptroller of the Currency, Federal Deposit Insurance Corporation, National Credit Union Administration Board and the Federal Housing Finance Agency will be drafting the regulations, rules, interpretive guidelines and general statements of policy - a daunting task. With so many moving parts, interdependencies and constituents, drafting the regulation should prove more difficult than passing the bill.
As an AMC, Pro Teck hopes that common sense prevails while drafting regulation. Most notably, we look forward to clarification on AMC appraiser registration fees and the definition of "customary and reasonable" fees paid to appraisers.
Part of the Dodd-Frank bill was a yearly $25 per appraiser per AMC registration fee (which may be adjusted to a maximum of $50 per appraiser per year). While Pro Teck understands the need to finance the new regulation, the way it is now written looks to be excessive.
Currently there is no cap on the fee an AMC can pay.
As an example, let's say there is an appraiser in California who works with 10 different regional and national AMCs (there are 350 registered AMCs in CA). The government would now receive $250 in fees for that one appraiser. If you estimate that approximately 40,000 appraisers are on at least one AMC panel, the cost to AMCs, including registration fees to comply with various State AMC registration and regulation laws, are likely to be in excess of $10,000,000.
These increased costs of doing business will eventually be passed onto the consumer.
Also in the bill it says that "customary and reasonable" fees will be determined by a study, excluding the fees that are "customary and reasonable" when an appraiser works with an AMC. Because of the reach of national lenders and their need for a national appraisal solution, 70% of appraisals in 2010 are being performed through AMCs.
How can you exclude 70% of the market in a study to determine market rates?
A good AMC adds value by investing in technology, data, quality control and customer service - all leaving the appraiser more time to appraise. AMCs also finance receivables, do all sales and marketing and manage workflow and orders.
Isn't it reasonable that the AMC would share some of the fee for what it provides the client and appraiser?
A recent experience of mine made the absurdity of these provisions come to light. What experience? Buying a dishwasher.
I bought the dishwasher at Sears, but it just as easily could have been Home Depot, Best Buy or any other national chain. I paid Sears the "customary and reasonable" fee to have the dishwasher delivered and installed by a licensed master plumber. The fee was the same as if I went to a plumber myself. The plumber took less from Sears for the customer service, marketing, billing, back office and planning they provide. I'm happy with my dishwasher, the plumber was happy for the business and Sears was happy with the sale.
Now, what if Sears had to register each plumber they use? What if each chain had to do the same? What if the government came in and told the chains how much they had to pay the plumber?
Sears needs the plumbers, so they will pay the added cost, but who is ultimately going to pay? The consumer.
Same is true in this. I know installing a dishwasher and appraising a piece of property are two totally different things, but the free market dynamics, wholesale versus retail, and responsibilities of the contractor and managing companies are the same.
Large national lenders are still going to work with AMCs because most banks do not want to become AMCs. They don't want the added cost, overhead and it's not a core competency. So who is going to pay?
The consumer.
For more than 30 years banks, servicers, investors and independent appraisers have seen the value of doing business with AMCs like Pro Teck. The need is there, the positive track record is clear, yet the bill in its current form does not reflect these truths.
Pro Teck Valuation Services sees the need for AMCs, lenders, appraisers, investors, consumers and the federal government to work together to guarantee efficient and effective commerce. We believe that if those writing the Dodd-Frank regulations share this belief, then common sense will prevail.
Pro Teck Valuation Services applauds the passage of the Dodd-Frank Financial Bill. It incorporates the best of HVCC, provides overdue protections to consumers and limits the financial exposure firms can maintain while investing.
Now comes the hard part.
During the next 90 days the Comptroller of the Currency, Federal Deposit Insurance Corporation, National Credit Union Administration Board and the Federal Housing Finance Agency will be drafting the regulations, rules, interpretive guidelines and general statements of policy - a daunting task. With so many moving parts, interdependencies and constituents, drafting the regulation should prove more difficult than passing the bill.
As an AMC, Pro Teck hopes that common sense prevails while drafting regulation. Most notably, we look forward to clarification on AMC appraiser registration fees and the definition of "customary and reasonable" fees paid to appraisers.
Part of the Dodd-Frank bill was a yearly $25 per appraiser per AMC registration fee (which may be adjusted to a maximum of $50 per appraiser per year). While Pro Teck understands the need to finance the new regulation, the way it is now written looks to be excessive.
Currently there is no cap on the fee an AMC can pay.
As an example, let's say there is an appraiser in California who works with 10 different regional and national AMCs (there are 350 registered AMCs in CA). The government would now receive $250 in fees for that one appraiser. If you estimate that approximately 40,000 appraisers are on at least one AMC panel, the cost to AMCs, including registration fees to comply with various State AMC registration and regulation laws, are likely to be in excess of $10,000,000.
These increased costs of doing business will eventually be passed onto the consumer.
Also in the bill it says that "customary and reasonable" fees will be determined by a study, excluding the fees that are "customary and reasonable" when an appraiser works with an AMC. Because of the reach of national lenders and their need for a national appraisal solution, 70% of appraisals in 2010 are being performed through AMCs.
How can you exclude 70% of the market in a study to determine market rates?
A good AMC adds value by investing in technology, data, quality control and customer service - all leaving the appraiser more time to appraise. AMCs also finance receivables, do all sales and marketing and manage workflow and orders.
Isn't it reasonable that the AMC would share some of the fee for what it provides the client and appraiser?
A recent experience of mine made the absurdity of these provisions come to light. What experience? Buying a dishwasher.
I bought the dishwasher at Sears, but it just as easily could have been Home Depot, Best Buy or any other national chain. I paid Sears the "customary and reasonable" fee to have the dishwasher delivered and installed by a licensed master plumber. The fee was the same as if I went to a plumber myself. The plumber took less from Sears for the customer service, marketing, billing, back office and planning they provide. I'm happy with my dishwasher, the plumber was happy for the business and Sears was happy with the sale.
Now, what if Sears had to register each plumber they use? What if each chain had to do the same? What if the government came in and told the chains how much they had to pay the plumber?
Sears needs the plumbers, so they will pay the added cost, but who is ultimately going to pay? The consumer.
Same is true in this. I know installing a dishwasher and appraising a piece of property are two totally different things, but the free market dynamics, wholesale versus retail, and responsibilities of the contractor and managing companies are the same.
Large national lenders are still going to work with AMCs because most banks do not want to become AMCs. They don't want the added cost, overhead and it's not a core competency. So who is going to pay?
The consumer.
For more than 30 years banks, servicers, investors and independent appraisers have seen the value of doing business with AMCs like Pro Teck. The need is there, the positive track record is clear, yet the bill in its current form does not reflect these truths.
Pro Teck Valuation Services sees the need for AMCs, lenders, appraisers, investors, consumers and the federal government to work together to guarantee efficient and effective commerce. We believe that if those writing the Dodd-Frank regulations share this belief, then common sense will prevail.
Thursday, January 14, 2010
Thousands of Citizens Protest Move to Regulate Internet
10,000 IFL Supporters File Comments with FCC
Regulations Not Necessary to Offer Americans the Open Internet They Already Have.
"Americans are increasingly concerned about government intrusion into nearly every aspect of the economy and their lives," according to Andrew Langer, President of the Institute for Liberty, "and the thousands of citizens who have told the Federal Communications Commission (FCC) to keep its hands off the Internet is proof that the technology sector is no exception."
"Over ten thousand Institute for Liberty supporters have filed comments with the FCC in the past week, opposing FCC regulations claiming to enforce some form of 'network neutrality,' even though we already have a free and open Internet, and there is absolutely no evidence to suggest that freedom and openness is threatened," according to Langer.
Langer concluded that "the FCC should acknowledge that network neutrality regulations are a solution in search of a problem. The American people are awakening to the fact that these so-called 'network neutrality' regulations are part of the radical leftist agenda of organizations such as Free Press, and the more the American people learn about such vast expansions of Federal power, the greater their opposition."
The Institute for Liberty supports keeping the government focused on the primary mission of making sure our nation is safe, while keeping it from unnecessarily interfering in the daily lives of America's entrepreneurs.
-----
www.politicalpotluck.com
Political News You Can Use
Regulations Not Necessary to Offer Americans the Open Internet They Already Have.
"Americans are increasingly concerned about government intrusion into nearly every aspect of the economy and their lives," according to Andrew Langer, President of the Institute for Liberty, "and the thousands of citizens who have told the Federal Communications Commission (FCC) to keep its hands off the Internet is proof that the technology sector is no exception."
"Over ten thousand Institute for Liberty supporters have filed comments with the FCC in the past week, opposing FCC regulations claiming to enforce some form of 'network neutrality,' even though we already have a free and open Internet, and there is absolutely no evidence to suggest that freedom and openness is threatened," according to Langer.
Langer concluded that "the FCC should acknowledge that network neutrality regulations are a solution in search of a problem. The American people are awakening to the fact that these so-called 'network neutrality' regulations are part of the radical leftist agenda of organizations such as Free Press, and the more the American people learn about such vast expansions of Federal power, the greater their opposition."
The Institute for Liberty supports keeping the government focused on the primary mission of making sure our nation is safe, while keeping it from unnecessarily interfering in the daily lives of America's entrepreneurs.
-----
www.politicalpotluck.com
Political News You Can Use
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