Medical loss ratios (MLRs), those metrics used by insurance companies to gauge medical costs as a percentage revenues from premiums, will be attracting some attention this week thanks to a provision in the recently passed reform bill that will allow a third party to be instrumental in determining how much insurers can ultimately spend on those admin costs — influencing profits in the process. That third party — the National Assn. of Insurance Commissioners (NAIC) — could have far-reaching authority in determining Insurance’s role in final implementation of the healthcare reform law come 2014.

HHS Sec’y Kathleen Sebelius could be at the mercy of the NAIC with respect to these new rules, creating disquietude among top Dems who favored reform with as little corporate influence as possible. Although the federal government has final say over where MLRs begin and end, states’ insurance commissioners actions will give lobbyists and insurers alike time to affect ultimate MLR regulations under reform law. Expect a mildly bumpy road at the hands of Insurance — which desires as little distance as possible between administrative quotas and earnings. | LINK

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