SAN FRANCISCO–The nation's insurance regulators who revised their process to ensure model laws they promote have more success in state legislatures have discovered that their effort needs some fine tuning.

At their plenary session here on Monday, commissioners found they were in disagreement on just what it meant when a commissioner cast a vote to approve a model law.

In the past, passage of an NAIC model took a simple majority. But when the organization found that models they approved were frequently going nowhere in the nation's legislatures they raised the requirement for approval to two-thirds of NAIC membership. The members hoped the move would spell more success in state legislatures if there was more backing from the start.

The exact importance of a vote came into question when commissioners were asked to approve a model that revised the NAIC's Long Term Care Insurance Model Act provisions for claim denials.

One commissioner said he thought there should be two votes: one to approve the model, and the other signifying a commissioner would work to secure its passage. While he personally favored the model that was up for a vote, he said he had too many other items to push for in his legislature to signify he would be promoting it with his lawmakers.

NAIC President Sandy Praeger, the Kansas insurance commissioner, said that two votes were not needed and it was understood that support meant pushing for a model within the commissioner's available time frame.

Maine Insurance Superintendent Mila Kofman said she would vote against the measure because her state already had a stronger measure than the model. If the NAIC intended to achieve uniformity for insurers with its models, that would mean some states would have to enhance their law and states like Maine would have to lower standards, she reasoned.

Pennsylvania Acting Insurance Commissioner Joel Ario, whose Health Insurance and Managed Care Committee created the model at issue, said the changes to achieve uniformity that Ms. Kofman spoke of were “true in an ideal world,” but insurers would be willing to accept the model as a ceiling.

Virginia Commissioner Alfred Gross said, however, that in his view the commissioners were “not voting a general concept. We're voting to make an effort to change the law, and Virginia already has a stronger law.”

Montana Commissioner John Morrison noted, however, that the NAIC had a history of creating models “followed by inaction.” If the membership wanted to see the basic objectives in the model for long-term care carried out across the country, “vote yes,” he said.

Mr. Gross said that what the NAIC was doing, if it was not looking to expect uniformity with the model, was “starting to fudge. We need to clarify our procedures.”

When the vote was initially taken there were 32 yes votes, four no and a raft of abstentions. At that point, Commissioner Ario commented that the abstentions amounted to a no vote since the measure did not have the required number for passage. He asked for the abstainers to reconsider and eventually the model drew 40 yes votes for passage.

Florida Commissioner Kevin McCarty said in the case of the model law at hand “where we already have a model,” he suggested that a different voting requirement might be in order where national uniformity was needed. In some cases, laws “need to be virtually identical. That's not the case here.”

Commissioner Ario declared that the NAIC language on voting “needs some fudge in it.”

“We'll work on language [in the future],” Commissioner Praeger declared.

NAIC needs a designation of those items where the goal is complete uniformity, added Mr. Morrison.

Special Reports /

NAIC Considers What A Vote Really Means

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