North Dakota’s Commissioner Adam Hamm: Consumer Protection Remains Top Priority

North Dakota’s Insurance Commissioner Adam Hamm was appointed to fill the vacancy left by a popular Insurance Commissioner Jim Poolman, who left 17 months early to take a job in the private sector. Amid the flack from Poolman’s early departure, the Republican attorney Hamm also inherited a number of scenarios as a new regulator including a controversial workers’ compensation organization that faces court battles, several key issues connected to life and health particularly affecting the elderly and a hard fought campaign with a Democratic opponent Rep. Jasper Schneider, D-Fargo, who is outspoken in his views. Hamm recently responded to Midwest Editor Sue McKenna’s questions about his new role and what he faces in the future — if elected.

IJ: What focus have you had so far in your role as insurance commissioner?
Commissioner Hamm: When I took the position of insurance commissioner in 2007, I let the citizens of North Dakota know that I was going to focus on consumer protection, competitiveness in markets and ensuring that companies and agents that do business in my state follow the rules and regulations of our Century Code.

Consumer protection is what we do every day in my department. We work to take care of issues between companies and policyholders but when that doesn’t work, we act quickly. Of particular concern continues to be Medicare Part D and Medicare Advantage plans as well as suitability in the sale of products to the elderly. I have increased resources in my divisions that work with these products and expect to do even more in the future.

I have also worked diligently regarding the health insurance market in North Dakota. We have a unique situation in that one company maintains approximately 90 percent of the market share. Not only have I been openly encouraging more competition in the state, but I have focused on thoroughly reviewing all aspects of this insurer and making them accountable for their dominant position within our health care system.

The North Dakota statutes that govern the industry are fairly standard as compared to other states. While I am pleased that I regulate in a state that has not had a tremendous amount of misconduct, fraud and unfair practices, this type of activity still occurs. I have strengthened our enforcement efforts in many ways in the department including hiring new staff in the areas of fraud, taking swift action against any violators, and adopting a more aggressive stance on collecting judgments.

IJ: What background and experience do you bring to the role of insurance commissioner?
Hamm: In addition to being North Dakota’s Insurance Commissioner since 2007, I have been an attorney for the last 10 years. From 1998-2001, I was a Cass County prosecutor. During that time, I prosecuted personal crimes including murder, rape, robbery, and child sexual and physical abuse.

From 2002 until becoming insurance commissioner, I was in private practice in Fargo advocating for North Dakota businesses and individuals. I specialized in commercial litigation, administrative agency law and transportation law.

IJ: Would you like to respond to your opponent’s criticism of the insurance department’s TV/radio ad that aired this summer that accused you of using department funds to further your campaign?
Hamm: Regarding the ad itself, here are the relevant facts: The ad was paid for by a supplemental federal grant that required 50 percent of the funding to be used to target low income Medicare beneficiaries. The insurance department had not planned on getting this funding and, although we help hundreds of low income people every year, we don’t often have the resources to use TV and radio, the two most far reaching forms of media.

The federal program that funded the ad, the Centers for Medicare and Medicaid Services (CMS), thoroughly reviewed our proposal for the grant. The ad cost was approximately one third of the total amount and was explained in detail in the proposal. The ad is running in counties where CMS identified the highest amounts of low income Medicare beneficiaries eligible for the programs.

The insurance department tracks all of its inquiries and knows when Medicare Part D (prescription drug coverage) calls increase and decrease. It is correct that after Nov. 15, the open enrollment period begins and calls increase. However, the other very busy time is when beneficiaries reach the doughnut hole or coverage gap of their Part D plan, now usually in August and September. At that time, they must pay 100 percent of the cost of their prescriptions and the fact is many simply can’t do it. Informing those in need of assistance during this time is very important.

The insurance department and I are extremely proud that we are reaching those in need through this ad. Since it began running, our weekly average number of individuals helped and applications completed increased dramatically.

I knew before the insurance department ad began to air that partisan criticism would predictably come my way. To me, the partisan criticism is worth it if the ad helps North Dakotans who need it.

IJ: What do you think will be some of the biggest issues during the next four years?
Hamm: The cost of insurance, especially health insurance, continues to be a top concern for North Dakotans. As I mentioned, I have devoted a large portion of my staff resources over the past year to monitor this market carefully. Further, while we don’t have the largest percentage of uninsured in our state as compared to others, this is also a concern of mine. I plan to carefully analyze these issues over the next four years.

Another imminent concern from a private-sector business perspective is the monopolistic state-run workers’ compensation agency that still exists in North Dakota. The system is being challenged and there are several different proposals on the table ranging from privatization to a change in corporate accountability. I have suggested that the insurance department, which has never had any regulatory authority over this agency, begin to take on duties related to the agency’s financial analysis, financial examination and market conduct. I believe this brings a new level of accountability to the system and fits well within the duties we currently conduct with other insurance companies. The proposals will be vetted beginning in January 2009, during the legislative session.

I also think the globalization of the industry will challenge all insurance commissioners in the next four years and likely in ways we aren’t even thinking of today. Issues like the threat of federal intervention, potential international accounting standards and market modernization are just the tip of the iceberg.

The national and global economies are presenting the entire industry with challenges and changing the way business has been done at a pace we’ve never experienced. My goal is to ensure that the market is stable in North Dakota, that I have a positive relationship with the companies here and that the changes that occur are for the benefit of the consumers I’ve promised to protect.