I just want to note one fly in the ointment that hasn't gotten a lot of press, in terms of the national insurance market. My concern is that sooner or later the Supreme Court will put us in the same situation we are with credit cards today: that the laws of the incorporating state of the issuer govern all aspects of the contract.

It is my understanding that, at least prior to the adoption of national legislation, that may not be entirely true in the case of "surplus lines" from "non-admitted carriers," as a general proposition. By example, see links to the following web pages of The Surplus Line Association of California:

"Non-Admitted Does Not Mean Non-Regulated" http://www.sla-cal.org/publications/pb_nonadmitted.html

and "Don't Worry -- Non-admitted Does Not Mean Non-regulated" http://www.sla-cal.org/publications/...doesntmean.pdf

But how this works now out in practice is another thing indeed. See, eGlobalHealth Insurers Agency, LLC, "Differences between Admitted U.S. Insurance & Surplus Lines International Medical Insurance Programs & What it means to you" at http://www.eglobalhealth.com/Pre-exi...formation.html and in particular, the following:

. . . Admitted policies are approved by U.S. regulators and the policy definitions & contract wording need to conform to strict standards set forth by U.S. regulators, state by state (there are a few states in the US -- ie; NY for one -- that are very strict and may not even allow certain US insurance companies to provide insurance in that particular state). Non-admitted carriers (ie; Surplus Lines like Lloyds of London, etc) are not required to follow any particular US or State regulations. One case in point, the Pre-existing language can be very different between an Admitted and Surplus Lines health insurance program. As a result, admitted wording tends to be more consumer friendly. Even though you may very well pay more for an admitted plan, it could end up being that you could, in certain circumstances, pay more in the long run, especially if you thought your pre-existing ailment or condition would be covered under your plan and it turns out it is excluded due to specific language or exclusionary riders placed on the policy prior to your acceptance in the program.

And note well: a "non-admitted carrier" doesn't have to be from overseas, it can just be from another state and has chosen not to be licensed as an "admitted carrier." where you live. Thereby exempting itself from a substantial part from your state's insurance regulation.

So, is there is any specific language in the legislation pertaining to the right of an individual state to regulate health insurance purchased in the "national market place" created by Healthcare Reform (whatever its formal title) or whether, merely through the creation of a national insurance market as a creature of federal statute, that alone may be seen as an "occupation of the field" pre-empting the laws and regulations of any state except that in which the carrier is domiciled?

In this regard, we are guided by the Supreme Court's decision in Marquette Nat. Bank of Minneapolis v. First of Omaha Service Corp. (439 U.S. 299), a unanimous 1978 decision holding that state anti-usury laws regulating interest rates cannot be enforced against nationally-chartered banks based in other states. In that opinion Justice William Brennan (of all people) wrote that it was clearly the intent of Congress when it passed the National Banking Act that nationally-chartered banks would be subject only to federal regulation by the Comptroller of Currency and the laws of the state in which they were chartered, and that only Congress or the appropriate state legislature could pass the laws regulating them. Full text of opinion at: http://caselaw.lp.findlaw.com/cgi-bi...=439&invol=299

And from which followed the "race to the bottom" to see which states would offer the least demanding set of regulation, including the de facto abolition of usury laws.

So the question becomes what "intent" - with respect to the ability of individual states to regulate the health insurance sold within its borders - will be found in the present legislation? If anyone has an understanding of the legislation on this point, I would love to know about it.

Mike