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Big ‘I’ Provides Comments on New Health Insurance Compensation Disclosure Requirements

The Big "I" and other organizations urged the Department of Labor to adopt a staged enforcement policy for new disclosure requirements.
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big ‘i’ provides comments on new health insurance compensation disclosure requirements

As previously reported, at the end of 2020 President Trump signed bipartisan legislation that included a $900 billion COVID-19 relief package and a $1.4 trillion omnibus government funding package into law.

The omnibus government funding legislation included a provision, Section 202 of the No Surprises Act, which will have a significant impact on health insurance producers and consultants, requiring them to disclose their compensation and other information to group health plan sponsors.

These new requirements are scheduled to take effect on Dec. 27, 2021. Earlier this year, the Big “I" provided a summary of the Section 202 health insurance compensation disclosure requirements.

As a result of this new disclosure requirement, the Big “I" joined with other major producer groups in sending a letter to the Department of Labor (DOL).

In the letter, the groups urged the DOL to consider a staged enforcement policy, so that agents and brokers could provide readily available compensation information before the effective date, along with a description of any additional compensation that is expected to be received in connection with the services being provided to the plan.

Moreover, the groups asked the DOL to implement a nonenforcement policy for the specific and detailed descriptions of the more cumbersome, formula-based compensation arrangements with carriers until 12 to 18 months after the effective date.

Besides the group health plan requirements, Section 202 also requires health issuers to disclose the compensation paid to the agent or broker involved in coverage selection and enrollment to individual health insureds. Earlier this year, the Big “I" participated in a Department of Health and Human Services (HHS) listening session regarding the implementation of the individual market agent and broker compensation requirements established by Section 202(c) of the No Surprises Act.

In addition to participating in the listening session, the Big “I" submitted comments to HHS regarding disclosure requirements that will apply in the individual market. In its comments, the Big “I" reiterated that Congress placed the Section 202(c) disclosure obligations for individual market plans exclusively upon health insurance issuers. Additionally, the Big “I" urged HHS to avoid any outcomes that formally or effectively apply these new mandates to agents and brokers. 

The Big “I" will continue to provide additional information from HHS and DOL as the effective date approaches. 

Wyatt Stewart is Big “I" assistant vice president of federal government affairs.

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Thursday, August 12, 2021
Life-Health