"In the year that he has held the position, Joel Ario has proven himself to be an able administrator and regulator who has fought to protect the rights and needs of consumers," Rendell said in a statement after the confirmation. "I'm glad the Senate has recognized Joel's achievements by confirming to this important position within my administration."
Ario, 54, previously served as the insurance administrator with the Oregon Department of Consumer & Business Services before Rendell tapped him for the post in Pennsylvania. Ario replaced Diane Koken, who held the post for nine years before resigning to serve on the board of Nationwide Insurance. Randy Rohrbaugh served as acting insurance commissioner after Koken's resignation.
Ario's confirmation had been blocked by Republican legislators because of concerns about his close relationship with Rendell and about how he would handle the proposed merger of Independence Blue Cross and Highmark Inc., the state's two largest health insurance companies. The merger would create one of the largest insurance carriers in the United States, and the combined companies would control more than half of Pennsylvania's health insurance market.
Collision industry groups do not expect Ario's appointment to lead to significant changes to the way that the industry interacts with the department.
"We met with former commissioner Koken on several occasions, and she was not very consumer-oriented," says Steve Behrndt, of the Pennsylvania Collision Trade Guild and owner of Crawford's Auto Center in Downington, Pa.
According to Behrndt, his organization has submitted numerous complaints about insurance carriers to the DOI and the state's attorney general over the past several years. The Collision Trade Guild's Web site (www.pctg.org) includes a publicly accessible complaint library indexed by repair shop, insurance company and appraiser.
"I can tell you that the body shops here are not shy about letting consumers know how to make a complaint to the Department of Insurance," says Ron Gallagher, deputy commissioner for producer and consumer services at the DOI. "We get between 50 to 150 complaints a year from consumers dealing with issues within the collision repair marketplace, and most of these are facilitated by the repair shops themselves.
"We recently hired an investigator who was formerly a licensed appraiser to help us with investigating collision repair complaints, and our dialogue with the industry is ongoing," Gallagher says.
He also noted that the type of complaints that the DOI hears has shifted during the past few years.
"Steering was a huge issue a decade ago, but the insurance companies are barred in Pennsylvania from directing a person to a DRP shop," Gallagher says. "Now it's more of a case of economic steering that we hear about. Body shops complain that they are being lowballed by the appraisers. The way the law is written, the carrier has to guarantee that the repair can be made for the appraised amount. What we're hearing from body shops is that they don't believe that the work can be done for that amount in some cases."
In addition to working with the Collision Trade Guild, Gallagher says that the DOI also is working closely with the Society of Collision Repair Specialists (SCRS). Earlier this year, Cindy Fillman, the department's consumer liaison, spoke at the SCRS annual meeting in Philadelphia. Her session specifically covered how repair shops could work with the department to settle consumer complaints.
Ario does have a more consumer-centric background than Koken, who served as the vice president, general counsel and secretary of Provident Mutual Life Insurance Company before being appointed to the commissioner's post. Earlier in his career, Ario worked with Ralph Nader's Public Interest Research Group as a consumer and environmental advocate. Ario is chair of the National Association of Insurance Commissioners (NAIC) Health Committee, and is the former chair of the NAIC Market Regulation and Consumer Affairs Committee.
Ario's primary focus in the past (and one of the reasons Rendell nominated him) has been on health insurance issues. While in Oregon, Ario spearheaded a number of reform initiatives that gave small businesses improved pooling options for health insurance and created more pricing transparency from insurers and hospitals.
