First Uniform-Licensing Bill Passes.

Kentucky passes uniform agent licensing; HIAA worries that reporting medical errors will spawn lawsuits; prescription drug bill may pass.

Kentucky's Legislature has passed an agent-licensing law, making it the first of 29 states needed to do so to head off federal intervention. The bill moves on to Gov. Paul Patton, who is expected to sign it, said Roger Snell of the Kentucky Insurance Department.

Kentucky's bill is similar to the model law adopted by the National Association of Insurance Commissioners in January with some "minor" amendments, Snell said.

The NAIC's Producer Licensing Model Act is designed to help standardize how insurance agents are licensed across the United States, so that an agent licensed in one state can do business in other states without going through the licensing process again for each state. Licensing laws for resident agents vary from state to state.

When the federal government passed the Gramm-Leach-Bliley Act last fall, revamping financial services and setting requirements for uniform-licensing provisions, it started the clock for insurance regulators. State legislatures have three years to adopt a law that allows for uniform laws across the state or reciprocal laws that recognize other states' provisions. At least 29 states must pass such laws within three years.

If states don't get it done, the National Association of Registered Agents and Brokers provision within Gramm-Leach-Bliley will mandate uniformity. It will take regulatory control from state insurance commissioners and put it in the hands of the federal government.

HIAA: Medical-Error Bills Must Try to Curb Litigation 

Proposals to require the reporting of medical errors that kill or seriously injure patients must include changes to curtail malpractice suits, the head of the Health Insurance Association of America said.

Any proposal involving the reporting of medical errors must consider "broader legal reform that would eliminate lawsuit abuse," HIAA President Chip Kahn said in a statement. "Furthermore, proposals intended to reduce medical errors must not impose unworkable and unnecessary paperwork burdens and administrative hassles for patients, hospitals, physicians, health plans or insurers."

HIAA supports efforts for detecting and reporting medical errors, the sharing of information on medical errors among hospitals and physicians and adopting "systemic reforms that will reduce medical errors in the future," Kahn said.

But proposals calling for mandatory reporting of medical errors "cannot be offered in a vacuum[ldots]without addressing lenient medical-malpractice laws and our nation's current litigious legal environment," he said.

U.S. Prescription Drug Coverage May Become Reality

Rep.Tom Bliley, R-Va., chairman of the House Commerce Committee, predicted passage of prescription drug legislation that would cover elderly Americans and offer subsidies for those who can't afford the drugs.

Bliley, who has announced his plan to retire, told business executives at a breakfast hosted by the U.S. Chamber of Commerce in late March that Congress could have the legislation ready this spring, leading to final passage this election year.

How the federal government finances the prescription drug coverage is still up in the air, a commerce committee staff member said. It may do so under Medicare or allow private insurers into the program. Such details are yet to be discussed.

Earlier, Citizens Against Government Waste released a report that opposed adding prescription drug benefits to Medicare. The addition would smother private insurance coverage, it said. Making all Medicare beneficiaries eligible for prescription coverage would "suck the air Out of the private insurance market just as conventional Medicare aborted the development of private medical and hospital insurance for Americans aged 65 and older," the report said.

But an actuary has told the Senate Finance Committee that private-sector management techniques for drug coverage could become a major tool in the integration of prescription drug coverage with Medicare.

Carol McCall, executive vice president for managed care at Allscripts Inc. in Chicago and a member of the American Academy of Actuaries Medicare Reform Task Force, cautioned that changes should be carefully thought out, given the potential costs. "If Medicare prescription drug coverage is enacted, Congress should consider allowing pharmacy benefit managers to participate," McCall said.

These managers, of which Allscripts is one, are fiscal intermediaries that administer pharmacy benefits for employers, health insurers and health maintenance organizations.

McCall, who wasn't testifying on behalf of the Academy of Actuaries, cited a recent Kaiser Family Foundation report that said pharmacy benefit managers administer 71% of prescription drug purchases at retail pharmacies covered by private, third-party payers.

Meanwhile, House Speaker J. Dennis Hastert, R-Ill., said he might form a prescription drug task force to speed legislation to the House floor.