State regulation of Insurance has been the norm almost exclusively. Insurance Companies are rarely subject to specific Federal regulation. See generally DENNIS J. WALL, 2 LITIGATION AND PREVENTION OF INSURER BAD FAITH § 9:16, "Statutory Preemption of the Common Law and of Other Statutory Causes of Action" (Third Edition and 2012 Supplement, West Publishing Company).
That is about to change.
Federal multistate Health Insurance Plans will be regulated by Federal Health Insurance standards. This is a new development. Federal Insurance Law will preempt conflicting State Health Insurance rules. It is not a new development for Federal Law to preempt conflicting State Laws; it is a new development for there to be such a thing as Federal Insurance Laws.
Federal Health Insurance Plans will be eligible for the new Health Insurance Exchanges being set up in the States under the Affordable Care Act, regardless of whether the Federal Plans meet State Health Insurance rules. Robert Pear, "U.S. Prepares to Sponsor Health Insurance Plans" p. 23, col. 1 (New York Times Nat'l ed., Sunday, October 28, 2012).
The Federal multistate Health Insurance standards have not, however, been made public. The National Association of [State] Insurance Commissioners, or "NAIC," has publicly announced its concern over these unknown rules. See generally the Health Insurance and Managed Care (B) Committee page on the NAIC website for general information about the Committee formed by the NAIC for this purpose. The Office of Personnel Management ("OPM") is the Federal agency empowered to issue the new rules. OPM has not released them. See the OPM Healthcare and Insurance page, for general information offered by OPM on those subjects without specifics addressing the new Plans.
However, it is publicly reported that:
- OPM will negotiate the premiums and benefits.
- OPM is "the agency that arranges health benefits for federal employees."
- The Federal multistate Health Insurance Plans will be offered "to individuals and small employers" through the Health Insurance Exchanges being set up in the States under the Affordable Care Act.
This may not be the same thing as the public option for Health Insurance. We do not know. We may know more when the OPM issues Federal rules and regulations for comment, which ought to describe these Federal multistate Health Insurance Plans with more details than we have now.
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