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- #31
- 868
He's in S. GA it would be a crystal meth pipe- just to clarify
A Health Insurance Exchange Will End Broker Based IFP?
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Regardless, he's high on something
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Just found this article:
To Play in U.S. Health Reform, Some Insurers May Leave Agents, Brokers Behind
Some U.S. health insurers may leave agents and brokers hanging out to dry as President Barack Obama seeks to slash their administrative expenses -- including commissions -- as one way to control high health care costs as part of his comprehensive proposal to overhaul the health care system, industry watchers say.
The president is committed to tackling health reform this year. The agenda he put forth on the campaign trail to provide coverage for everyone included the creation of a National Health Insurance Exchange to help individuals and businesses buy private coverage or they could enroll in a new, public, or government, health plan.
Members of the Democrat-controlled Congress are expected to draft legislation this summer, and key members of the Senate, including Finance Committee Chairman Max Baucus, D-Mont, embrace the concept of an exchange.
Agents and brokers "are going to get whacked very hard on this," said J.P. Wieske, director of state affairs for the Council for Affordable Health Insurance, Alexandria, Va. The intent of exchanges is "to replace the agents," he said. Most hard hit would be those who work with small businesses, a market where commissions are the highest, Wieske said. Â
The private health insurance industry and agents and brokers are united in opposing the proposed government plan, but an exchange may be a thorn solely in brokers' sides.
Commissions are "an easy target," said Sam Fleet, president and chief executive officer of AmWins Group Benefits, a wholesale brokerage. The average cost of distribution for commercial health plans, including broker fees, sales and marketing, accounts for 30% to 50% of total administration, totaling $23 billion annually, he said.
The exchange would function similar to a Federal Reserve of Health Insurance, setting premiums and telling brokers what they can make, Fleet said. "The translation is, hold on to your commission checks."
According to Fleet, insurers "aren't going to stick up for the broker." For years, they've been writing business direct and selling insurance through the Internet to bypass agents and brokers, he said. Some health insurers with a national presence may think "we may as well go along and get along," echoed Wieske, saying insurers can "live with the exchange."
But Janet Trautwein, chief executive officer of the National Association of Health Underwriters, said she's not sure a national exchange will be the ultimate result of reform. She doesn't think carriers "are about to throw us under the bus." That doesn't mean, however, there won't be pressure on them to reduce administrative fees, especially in the individual and small group market, Trautwein said.
Robert Zirkelbach, a spokesman for America's Health Insurance Plans, the industry trade group, said brokers and agents play a vital role in helping consumers and employers find coverage that is right for them. "As the nation pursues comprehensive health care reform, brokers and agents will continue to play an important role in this process," he said.
Opposing an exchange is Don Hamm, president and chief executive officer of Assurant Health, which specializes in insurance for individuals and small businesses. Independent insurance agents "provide independent, expert advice and individualized solutions to consumers, which is now more important than ever," he said. "It would be a mistake to diminish that important value by implementing a one-size-fits-all connector approach."
NAHU is launching a "major grassroots effort" discussing the value that agents and broker bring to the health care system, Trautwein said. They do more than help someone fill out an application, she said. For small employers, they serve as their human resources department, and a big part of their job is providing service after the sale, Trautwein said.
Nancy-Ann DeParle, director of the White House Office of Health Reform, has said she's not clear about the value of brokers but Trautwein said she hopes her group's campaign will change that view.
Less commissions equals lower ROI, which means Sunmed is going to start another company and say "F" this! I've been doing this for 20 years and I wouldn't mind doing something outside of insurance sales. We might have another year or two to plan for plan "B". I do think the status quo will come to a halt eventually. Disclaimer: MAYBE!
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Just found this article:
To Play in U.S. Health Reform, Some Insurers May Leave Agents, Brokers Behind
Some U.S. health insurers may leave agents and brokers hanging out to dry as President Barack Obama seeks to slash their administrative expenses -- including commissions -- as one way to control high health care costs as part of his comprehensive proposal to overhaul the health care system, industry watchers say.
The president is committed to tackling health reform this year. The agenda he put forth on the campaign trail to provide coverage for everyone included the creation of a National Health Insurance Exchange to help individuals and businesses buy private coverage or they could enroll in a new, public, or government, health plan.
Members of the Democrat-controlled Congress are expected to draft legislation this summer, and key members of the Senate, including Finance Committee Chairman Max Baucus, D-Mont, embrace the concept of an exchange.
Agents and brokers "are going to get whacked very hard on this," said J.P. Wieske, director of state affairs for the Council for Affordable Health Insurance, Alexandria, Va. The intent of exchanges is "to replace the agents," he said. Most hard hit would be those who work with small businesses, a market where commissions are the highest, Wieske said. Â
The private health insurance industry and agents and brokers are united in opposing the proposed government plan, but an exchange may be a thorn solely in brokers' sides.
Commissions are "an easy target," said Sam Fleet, president and chief executive officer of AmWins Group Benefits, a wholesale brokerage. The average cost of distribution for commercial health plans, including broker fees, sales and marketing, accounts for 30% to 50% of total administration, totaling $23 billion annually, he said.
The exchange would function similar to a Federal Reserve of Health Insurance, setting premiums and telling brokers what they can make, Fleet said. "The translation is, hold on to your commission checks."
According to Fleet, insurers "aren't going to stick up for the broker." For years, they've been writing business direct and selling insurance through the Internet to bypass agents and brokers, he said. Some health insurers with a national presence may think "we may as well go along and get along," echoed Wieske, saying insurers can "live with the exchange."
But Janet Trautwein, chief executive officer of the National Association of Health Underwriters, said she's not sure a national exchange will be the ultimate result of reform. She doesn't think carriers "are about to throw us under the bus." That doesn't mean, however, there won't be pressure on them to reduce administrative fees, especially in the individual and small group market, Trautwein said.
Robert Zirkelbach, a spokesman for America's Health Insurance Plans, the industry trade group, said brokers and agents play a vital role in helping consumers and employers find coverage that is right for them. "As the nation pursues comprehensive health care reform, brokers and agents will continue to play an important role in this process," he said.
Opposing an exchange is Don Hamm, president and chief executive officer of Assurant Health, which specializes in insurance for individuals and small businesses. Independent insurance agents "provide independent, expert advice and individualized solutions to consumers, which is now more important than ever," he said. "It would be a mistake to diminish that important value by implementing a one-size-fits-all connector approach."
NAHU is launching a "major grassroots effort" discussing the value that agents and broker bring to the health care system, Trautwein said. They do more than help someone fill out an application, she said. For small employers, they serve as their human resources department, and a big part of their job is providing service after the sale, Trautwein said.
Nancy-Ann DeParle, director of the White House Office of Health Reform, has said she's not clear about the value of brokers but Trautwein said she hopes her group's campaign will change that view.
Less commissions equals lower ROI, which means Sunmed is going to start another company and say "F" this! I've been doing this for 20 years and I wouldn't mind doing something outside of insurance sales. We might have another year or two to plan for plan "B". I do think the status quo will come to a halt eventually. Disclaimer: MAYBE!
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- 2,908
I think many Brits would remind us that the goal should be to get good health care for the population, not just to get a government health care system. One does not necessarily guarantee the other.
- 6,013
True that . . .
Also - do the other rail monkeys - not high on anything but life. The way things are now - the average person making a median income with health issues can't get affordable coverage.
Even though I'm an agent - I'm all for the little guy being able to getting a crown or an X-ray and not having to settle for an extraction or hobbling around . . .
As always - the rich get richer.
By the way - I hope Obama can fix the mess our country is in. If not - I vote for C Rice . . .
Tom
- Thread starter
- #35
- 868
I trust my intuition when it comes to my business and my trading and 9 times out of 10 my intuition is right.
I started this thread because i know the exchange is the greatest threat to the broker; not GI and not mandates. As brokers we have neglected this truth. The companies wont stand up for the middlemen and no matter how much we sell for them if they can go direct with 75% of the current volume they will because they feel the exchange will bring them a bonanza of business.
I started this thread because i know the exchange is the greatest threat to the broker; not GI and not mandates. As brokers we have neglected this truth. The companies wont stand up for the middlemen and no matter how much we sell for them if they can go direct with 75% of the current volume they will because they feel the exchange will bring them a bonanza of business.
My two cents, worth every penny...
First, make health insurance like car insurance. Mandatory. Those who choose to break the law can visit a county clinic. We'll then have a record who needs to get a plan.
Second, make health insurance guaranteed issue. Since health insurance would be mandatory, the healthier population would help to spread the risk.
Third, simplify the payment system by using individual plans for all, allowing for national plans, and allowing for list-billing by employers. Also allow employers to pay a portion of individual health plans. Let employers compete with each other for the best employees by paying a higher percentage of the plan, as they can afford.
Fourth, take the ten ka-zillion dollars the government has set aside for health care and (1) establish 100% electronic medical information systems from coast to coast - we're currently at about 14% - including software, hardware & maintenance, (2) increasing scholarships to medical schools to decrease money owed later, and (3) requiring new physicians to spend their first two or three years in county clinics to pay off their education.
Fifth, allow the insurance companies to make prevention and personal responsibility a pocketbook issue by rewarding/penalizing people based on their behaviors and health results.
And sixth, speaking of results, do the same kind of rewarding/penalizing to physicians based on results. The faster the physician produces a positive outcome, the more they'll make. The more they kick the can down the road by prescribing worthless drugs and running too many tests, the less they'll make.
Either that, or let Mommy Government take care of us all.
First, make health insurance like car insurance. Mandatory. Those who choose to break the law can visit a county clinic. We'll then have a record who needs to get a plan.
Second, make health insurance guaranteed issue. Since health insurance would be mandatory, the healthier population would help to spread the risk.
Third, simplify the payment system by using individual plans for all, allowing for national plans, and allowing for list-billing by employers. Also allow employers to pay a portion of individual health plans. Let employers compete with each other for the best employees by paying a higher percentage of the plan, as they can afford.
Fourth, take the ten ka-zillion dollars the government has set aside for health care and (1) establish 100% electronic medical information systems from coast to coast - we're currently at about 14% - including software, hardware & maintenance, (2) increasing scholarships to medical schools to decrease money owed later, and (3) requiring new physicians to spend their first two or three years in county clinics to pay off their education.
Fifth, allow the insurance companies to make prevention and personal responsibility a pocketbook issue by rewarding/penalizing people based on their behaviors and health results.
And sixth, speaking of results, do the same kind of rewarding/penalizing to physicians based on results. The faster the physician produces a positive outcome, the more they'll make. The more they kick the can down the road by prescribing worthless drugs and running too many tests, the less they'll make.
Either that, or let Mommy Government take care of us all.
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Mac -
You are drinking the kool-aid. To make it work, you have to actually fix some of the problems, not just put a little bandaid on things (scholarships doesn't reduce health care costs, it moves the cost).
Also, having insurance to protect yourself driving your car is NOT MANDATORY. I wish people would get this correct. Driving is a privilege, if you want to drive, you have to show financial responsibility in case you damage someone else. Nobody (but you and the bank) care about the damage you do to your car.
Despite popular belief, electronic medical records cost money, not save money. Try running a paperless office, you'll quickly realize this. There are benefits, but, it's not the panacea to fix the costs of healthcare.
Ironically, taking medicare out of the equation would help lower health care costs for most Americans.
Mandates also raise the costs of healthcare for all, but it does spread the cost out more. I guess it depends if you are concerned about the overall dollars or just your share of the dollars.
Either way, it will be interesting.
Dan
You are drinking the kool-aid. To make it work, you have to actually fix some of the problems, not just put a little bandaid on things (scholarships doesn't reduce health care costs, it moves the cost).
Also, having insurance to protect yourself driving your car is NOT MANDATORY. I wish people would get this correct. Driving is a privilege, if you want to drive, you have to show financial responsibility in case you damage someone else. Nobody (but you and the bank) care about the damage you do to your car.
Despite popular belief, electronic medical records cost money, not save money. Try running a paperless office, you'll quickly realize this. There are benefits, but, it's not the panacea to fix the costs of healthcare.
Ironically, taking medicare out of the equation would help lower health care costs for most Americans.
Mandates also raise the costs of healthcare for all, but it does spread the cost out more. I guess it depends if you are concerned about the overall dollars or just your share of the dollars.
Either way, it will be interesting.
Dan
- 4,096
The health insurance exchange is for the 2-10 life group. That is what I have been told from a state president of National health Insurance company.
There will still be commissions but it will be regulated by the Gov. much like Medicare Advantage plans.
So if you have a large block of small groups like I do the threat is very real.
The exchange will have set rates for coverage with no underwriting. So even if you have a private small group plan in place your employees can elect to take the exchange plan.
The lobbyists are currently trying to have the exchange for group 2-5 lives (micro groups)
At this point this exchange is going to happen at what level we dont know yet.
I was told the individual market will not be effected by the exchange and that the exchange is only for small group.
The Individual market is going to give premium assitance and GI.
The exchange is really going to knock down brokers that have large blocks of micro groups.
We are going to end up making less. If the health care industry as a whole is going to reduce cost by 2 trillion in the next 10 years everyone associated with health care will make less. Hospitals, Doctors, Lawyers, Insurance Companies, Agents, Durable medical, and so on.
There will still be commissions but it will be regulated by the Gov. much like Medicare Advantage plans.
So if you have a large block of small groups like I do the threat is very real.
The exchange will have set rates for coverage with no underwriting. So even if you have a private small group plan in place your employees can elect to take the exchange plan.
The lobbyists are currently trying to have the exchange for group 2-5 lives (micro groups)
At this point this exchange is going to happen at what level we dont know yet.
I was told the individual market will not be effected by the exchange and that the exchange is only for small group.
The Individual market is going to give premium assitance and GI.
The exchange is really going to knock down brokers that have large blocks of micro groups.
We are going to end up making less. If the health care industry as a whole is going to reduce cost by 2 trillion in the next 10 years everyone associated with health care will make less. Hospitals, Doctors, Lawyers, Insurance Companies, Agents, Durable medical, and so on.
- 2,908
True in regard to the exchange applying to groups. However this is just a terminolgy thing in the end. It is inconceivable that the government will not set criteria for individual plans to qualify for subsidy or tax credit. Simply because the individual plans may not fall within the exchange for groups does not mean that criteria will not be set for such plans, or "creditable plan" as I call them until we see what Obama's term will be.
And although agents may have some piddling involvementwith the individual plans as well, as a practical matter they will be guaranteed issue and only a nit-wit would pick a plan that does not qualify for subsidy or tax credit. So consumers can very easily find their own way.
- 9,744
Be careful. This person (unless on one of the Congressional committees) doesn't know anything more than the rest of us. As a matter of fact, most of the nitwits in HO know a good deal less.
Doesn't make sense.
You really believe this?
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