[Congressional Record Volume 155, Number 139 (Wednesday, September 30, 2009)]
[Senate]
[Pages S9983-S9984]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. FRANKEN (for himself, Mr. Rockefeller, Mr. Whitehouse, and 
        Mr. Sanders):
  S. 1730. A bill to provide for minimum loss ratios for health 
insurance coverage; to the Committee on Health, Education, Labor, and 
Pensions.
  Mr. FRANKEN. Mr. President, I am pleased today to introduce the 
Fairness in Health Insurance Act. This bill will hold health insurance 
companies accountable by requiring that at least 90 percent of your 
premium dollars go toward health services, not profits or 
administrative waste. As we move forward in health reform, it is 
essential that health insurance companies know that their top priority 
must be serving beneficiaries, not taking care of shareholders or CEOs.
  This bill is inspired by the unique culture of health care in 
Minnesota, which includes the Mayo Clinic, cooperative models like 
HealthPartners, and visionary public health leadership from State 
legislators. Heath care in our State is also distinguished by the fact 
that 90 percent of Minnesotans are served by a nonprofit health plan. 
These plans outperform their national peers and are able to put 91 
cents of every premium dollar toward actual health care services.
  In other plans throughout the nation, though, you may find less than 
60 percent of your premium is put toward health care; the rest is for 
overhead, marketing and profits. By taking the profits out of the 
health insurance industry, Minnesota health plans do a better job 
helping our residents to live healthier, longer lives. The Fairness in 
Health Insurance Act will help us hold all health plans to the same 
standards we've set in Minnesota by requiring that 90 percent of 
premium dollars actually pay for health services.
  But while millions of Americans struggle to pay for health care, 
insurance executives continue to make obscene salaries. Last year, 
three top health insurance executives saw boosts in their total 
compensation--some of them making almost $10 million. I believe in fair 
competition but I do not support companies making obscene profits off 
of health care. The Fairness in Health Insurance Act will force 
insurance companies to prioritize health services for beneficiaries 
over bonus packages for CEOs.
  In fact, the current reality is that most of us don't know where our 
health insurance premiums go. It's challenging enough to understand a 
billing statement from your health insurance company, much less track 
where your money is being spent. The Fairness in Health Insurance Act 
also requires transparent reporting of how health insurance companies 
are spending your money. This transparency is especially important as 
we move to cover all Americans in health reform. Clear reporting will 
help us hold insurance companies accountable for every dollar we invest 
in health insurance.
  Now, although Minnesota outperforms most states in health care, I 
know we can continue to do better as well. When I talk with 
Minnesotans, I hear again and again that people are living in fear 
about health care. They are afraid of losing their health insurance, or 
worried about getting sick and going bankrupt. The reality is that 50 
percent of bankruptcies today are caused by health costs and 80 percent 
of these Americans actually have health insurance.
  Passing national health reform this year is my top priority because I 
have listened to Minnesotans across the State. They have told me, loud 
and clear, that the current health insurance system is not working for 
them. The Fairness in Health Insurance Act of 2009 is an important part 
of my health reform strategy that also includes cost containment, 
simplifying paperwork, focusing on prevention, pushing for a public 
option and making

[[Page S9984]]

sure that all Americans have access to affordable, secure health 
insurance.
  I urge my colleagues to work with me to ensure that these commonsense 
strategies are included in our health reform bill when it comes to the 
floor. Taken together, these elements will bring our country into a new 
era in which high-quality--and affordable--health care is a reality for 
all Americans.
  Mr. President, I ask for unanimous consent that the text of the bill 
be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1730

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Fairness in Health Insurance 
     Act''.

     SEC. 2. REQUIREMENT OF MINIMUM LOSS RATIO OF 90 PERCENT FOR 
                   HEALTH INSURANCE COVERAGE.

       (a) In General.--A health insurance issuer shall not offer 
     health insurance coverage unless the issuer demonstrates that 
     such coverage has a medical loss ratio of at least 90 
     percent.
       (b) Medical Loss Ratio.--
       (1) In general.--In this section, the term ``medical loss 
     ratio'' has the meaning given such term by the Secretary of 
     Health and Human Services. The Secretary shall establish a 
     uniform definition of medical loss ratio and methodology for 
     determining how to calculate the medical loss ratio. Such 
     methodology shall take into account the circumstances of 
     different plans and activities related to health services 
     such as chronic disease management and quality assurance.
       (2) Report.--Not later than December 31, 2010, the 
     Secretary of Health and Human Services shall publish a report 
     that describes the definition developed under paragraph (1) 
     and the elements with respect to such definition.
       (c) Transparency.--
       (1) Submission of data.--Beginning in plan year 2011, a 
     health insurance issuer shall provide the Secretary of Health 
     and Human Services with data to enable the Secretary to 
     determine whether the issuer is in compliance with subsection 
     (a) with respect to health insurance coverage offered by such 
     issuer.
       (2) Development of elements and definitions.--Not later 
     than December 31, 2010, the Secretary of Health and Human 
     Services shall develop, publish in a report, and implement 
     the standardized data elements and definitions to be used by 
     health insurance issuers in the reporting of data necessary 
     for the calculation of the medical loss ratio under paragraph 
     (1).
       (d) Rebates.--Each health insurance issuer that offers 
     health insurance coverage shall provide that for any plan 
     year in which the coverage has a medical loss ratio below 90 
     percent, the issuer shall provide, in a manner specified by 
     the Secretary, for rebates to enrollees of payments 
     sufficient with respect to such loss ratio.
       (e) Enforcement.--The Secretary shall promulgate 
     regulations for enforcing the provisions of this section and 
     may provide for appropriate penalties.
       (f) Definition.--In this section, the terms ``health 
     insurance coverage'' and ``health insurance issuer'' shall 
     have the meanings given such terms in section 2791 of the 
     Public Health Service Act (42 U.S.C. 300gg-91).
                                 ______