Agents vs. The Exchange

Assuming Obamneycrap survives, in 2014 consumers will be expected (told) to buy health insurance through an exchange. Agents have already taken a 50% or higher pay cut on health insurance and many have either left the industry or moved on to other, more profitable lines of coverage. Those that are hanging on in hopes of better times may be disappointed.

LifeHealthPro, an industry publication, has this interesting article on the future of exchanges and how the agent may, or may not, have a place come 2014.

Under the final rule, states will also be allowed to:

• allow agents and brokers to assist qualified employers and employees (as well as individuals) in enrolling in exchange plans (known as “qualified health plans (“QHPs”), and in submitting applications for premium tax credits and cost-sharing subsidies to help individuals pay for their insurance

• allow agents and brokers to participate in the “Navigator” program that is specifically designed to educate the public about exchanges and assist with enrollment

• display information about agents and brokers on the websites that exchanges will be required to set up to serve as an access portal for the public

Supposedly there are several agent associations and even some insurance commissioners petitioning HHS to allow agents to continue to act as advisers for those seeking health insurance.

Then there is the issue of compensation . . .

In light of the recent termination of agent compensation for referrals to PCIP I am (for obvious reasons) skeptical of any income from health insurance activity in 2014 and later.

Even if agents are allowed to participate, there are still some excruciating requirements for those who want to press forward.

If a website of an agent or broker is used to complete the QHP selection, the website must meet certain minimum requirements.

The private website must: meet all disclosure standards and QHP display requirements regarding standardized comparison information and accessibility (e.g., plain language and accessible, timely disclosures), provide consumers the ability to view all QHPs offered through the exchange; not provide financial incentives, such as rebates or giveaways; and display all QHP data provided by the exchange, these lawyers say.

The private website must also maintain audit trails and records in an electronic format for a minimum of 10 years; and provide consumers with the ability to withdraw from the process and use the exchange website instead at any time.

These lawyers note that all agents and brokers enrolling qualified individuals in QHPs or assisting individuals applying for advance payments of the premium tax credit and cost-sharing reductions must enter into and abide by an agreement with the exchange.

At a minimum, the lawyers say, the agreement must require agents and brokers to register with the exchange in advance of enrolling any individuals in QHPs; receive training regarding the range of QHP options and insurance affordability programs; and comply with the Exchange’s privacy and security standards.

Agents and brokers enrolling or assisting individuals through the exchange must comply with all state laws related to agents and brokers, including laws related to confidentiality and conflicts of interest, these lawyers said.

Uh, thanks, but no thanks.