When the Affordable Care Act was initially passed, there was quite a bit of concern on the part of insurance brokers and agents throughout the country. How would this effect the industry? What would be the impact on business and commissions?
The Act calls for “Navigators” to help educate the public and provide impartial information on plans. A big worry that arose is the qualifications of these Navigators asking the question whether consumers would be put at risk by having unlicensed, minimally-trained Navigators in place performing part of the function that has traditionally been done by agents and brokers.
To prevent this from happening, the National Association of Insurance Commissioners (NAIC) just passed a resolution recognizing brokers’ and agents’ roles in the country’s health care delivery system. This will limit the Navigator’s role to directing Exchange consumers to government agencies and licensed insurance professionals.
The recognition by the NAIC of this important function by agents and brokers is a true testament to the critical role that they play in being the “trusted advisor” to the millions of business owners and individuals in the purchasing of their health insurance.
But, can the limitation on Medical Loss Ratio (MLR) in the new law co-exist with providing adequate compensation to brokers and agents to continue their important role? The National Association of Health Underwriters (NAHU) thinks it can and recognizes the need for a proper balance. Supported by many other constituencies, NAHU is also asking the NAIC to exclude money distributed to brokers as a component of the final MLR calculation to further insure that these ratios are not compromised.
While their support is gaining momentum, it still has a long way to go before the NAIC agrees to exclude broker commissions (or some portion thereof) from the MLR calculation. Without such exclusion, the result may lead to lower broker and agent commissions, further resulting in brokers leaving the market or asking their clients to pay a separate fee for their services.
While we work with NAHU and the NAIC on determining the final regulatory MLR definition, we are confident that the successful time-tested system of brokers and agents as “trusted advisors” will continue to serve our clients well.
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Fellow Agents. The insurance
Fellow Agents.
The insurance companies have always wanted to do without us, and the government has decided we are all crooks. Our agency is a family business and 4 years ago, 90%+of our revenue came from health commissions. Seeing the handwriting on the wall we began to diversify. We are now down to 50% health and have made up the difference with P&C. We layed off most of our employees got lean and, are now prospering again. I no longer buy health leads or adrvertise health since I can't predict income. All of my health business is word of mouth. I spend the lead money on Home owners and try to write commercial policies of of it. It seems to be working well. I hope this all works out for agents, as I prefer the health industry and have 20 years experience in it.
However. I think that if you are still depending on health insurance sales for your income, you had better start looking for something else.
Bill Hall Sr.
Has anyone noticed that in
Has anyone noticed that in 2014 when the exchanges are created the small business tax credit will only be offered to small businesses that purchase health insurance coverage through a health insurance exchange! This is ridiculous. The governmen is bribing small business owners to get their health insurance through the exchange...where does that leave private health insurance companies?
This looks to me like the government is trying to force private insurance companies to lose so much participation that they will no longer be able to afford to stay in business. How can a private health insurance company be expected to keep premiums down when they will be losing a large segment of their business. They will be forced to increase prices, therefore more businesses will be forced to purchase health insurance from the exchanges, because they will not be able to afford the increasing health insurance premiums from private insurance companies, and private insurance companies will be forced out of business.
The government is pretending to want to help Americans, but they are taking away our freedom of choice, not to mention the thousands of people that will be out of work due to this. Wouldn’t it make more sense for the government to offer a tax credit to businesses regardless of where they get their insurance???
The Health Insurance Exchange
The Health Insurance Exchange will consist of all commerical insurance companies that you see now. Therefore, they will not go out of business. This is why their stock has gone up. It would cost the country too much money to put these companies out of busines.
The resolution may state that
The resolution may state that it's intent is to protect the consumer, but the way I read it, it's purpose is to protect the agent and broker.
The purpose of the exchange is to make product and pricing transparent enough for the average consumer to understand and make an educated decision as to which insurance plan to purchase.
Value is in the eye of the consumer. If the services you provide added or enhanced value, then consumers and insurers should be willing to pay for them.
The industry would be better off adopting fee for service methods of compensation. Services may include client retention fees, adoption of wellness and preventative care programs, enrollment in smoking cessation, weight loss and exercise plans.
Thanks for letting me add my 2 sense.
Bruce Silver
Employers Rx LLC
The CURE for your employee management headaches
http://employers-Rx.com
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