- 15,041
At least no more chargebacks. Add the commission to the first month's premium. Due in full and fully earned.
Might Get Lucky Yet ...
- Thread starter stuy119
- Start date
At least no more chargebacks. Add the commission to the first month's premium. Due in full and fully earned.
- 3,384
For IFP you may be correct, but we will have to see. For small group, it may be the different.
CA set up a state exchange back in the 90's called HIPC (Health Insurance Plan of California). It was later changed to PacAdvantage before disolving a few years ago (no major Blue would participate at the rates needed).
HIPC/PacAdvantage orignally did not include agent compensation and groups could elect to use an agent at extra cost. Something like 80%+ of groups elected to use an agent and pay the extra cost in agent comp for the service. HIPC decided that since the vast majority of businesses were using and agent anyway, they would reformat the program to include agent comp.
Our viability is going to be determined by the buying public. They will have to decide, over time, whether they prefer the assistance of a licensed professional or are content to get plan navigation help from community organizations or the Dept of Fish & Game.
If I didn't know better, I'd think that we talked to the same people. I litterally shook my head when I've gotten off of the phone with some of them.
Correct me if I'm wrong, but I was thinking that they would eventually go back to hospital plans and what not, like they used to offer before MM became such a staple item.
The way things are now, I see more uninsured in the future, without a Ma. style State HMO for uninsured.
- Thread starter
- #14
- 1,896
People already think that states are bloated organizations that have terrible customer service, but seem to think that a single-payer system is the way to go. Wat?
It will quickly become evident to taxpayers, small businesses, and individuals that having an agent is in their best interests. Agents pick up their cell phones at 10pm in an emergency, have access to the best/easiest problem-solving materials, and know who to call to make things happen. The government will not, and overloaded insurance carriers won't make their life easy, and will make the government look bad in the process.
It's just up to another generation of carrier execs to realize that we're the engine that drives sales, and not the "shingle" hanging out in front of their offices.
It will quickly become evident to taxpayers, small businesses, and individuals that having an agent is in their best interests. Agents pick up their cell phones at 10pm in an emergency, have access to the best/easiest problem-solving materials, and know who to call to make things happen. The government will not, and overloaded insurance carriers won't make their life easy, and will make the government look bad in the process.
It's just up to another generation of carrier execs to realize that we're the engine that drives sales, and not the "shingle" hanging out in front of their offices.
- 990
The public's problem is that they think of ins. companies as "middlemen."
Without them there is no service, no accountability and no competition. Medical services are paid for in only to 2 ways; by tax or by risk pooling. Why is it so difficult for people to get their minds around this?
Without them there is no service, no accountability and no competition. Medical services are paid for in only to 2 ways; by tax or by risk pooling. Why is it so difficult for people to get their minds around this?
- 901
IMO in the best case scenario where commissions are extracted from MLR calculations, even then, the best we see is like 15% FYC from any major carrier with cutthroat renewals.
Only the podunks will offer 20ish FYC.
Only the podunks will offer 20ish FYC.
- 990
That makes about as much sense as me saying that they will have no cause to change our end of it if the commissions are exempt from MLR?
They are gonna do whatever they can get away with.
Noboby knows. Should be interesting if nothing else.
We'll know by 04/2011.
They are gonna do whatever they can get away with.
Noboby knows. Should be interesting if nothing else.
We'll know by 04/2011.
Just my two cents after reading all of the comments in this thread. By the way, I have been in the employee benefits business for 28 years.
Sorry to say, but I believe the commission payments will be cut back drastically, if not completely. To begin with, the large carriers (Blues, United, CIGNA, Aetna, Humana) view HC Reform as an opportunity for them. Their goal was to commoditize the product, thus eliminating the broker. (See travel agents)
When the MLR's were announced, it was clear that very few carriers could meet these requirements. Guess which 5 could do it easily? Good bye to a number of competitors, such as Princpal Financial. Fight for us? They want commissions to be expenses!
With this competition out of the way, and govt pressure to have a simple menu of plans (Gold, Silver, Bronze) and the Exchanges, health benefits just became a commodity. Commodities do not need sales people because it is a transactional sale.
The CA HIPC model of direct sales failed for a variety of reasons, the two major being; 1) too many options (i.e., not a commodity sale), and 2) lack of ability for purchaser (employer) to get quote quickly and easily.
As for speaking with carrier people, not always a reliable source of information. As for their belief that there will still be a role for agents...what did you expect them to say?
With commissions reduced/gone, a broker who wants to stay in the employee health business needs to either; 1) add a consulting fee--good luck here, or 2) sell self-funding.
As I said earlier, just me two cents.
Sorry to say, but I believe the commission payments will be cut back drastically, if not completely. To begin with, the large carriers (Blues, United, CIGNA, Aetna, Humana) view HC Reform as an opportunity for them. Their goal was to commoditize the product, thus eliminating the broker. (See travel agents)
When the MLR's were announced, it was clear that very few carriers could meet these requirements. Guess which 5 could do it easily? Good bye to a number of competitors, such as Princpal Financial. Fight for us? They want commissions to be expenses!
With this competition out of the way, and govt pressure to have a simple menu of plans (Gold, Silver, Bronze) and the Exchanges, health benefits just became a commodity. Commodities do not need sales people because it is a transactional sale.
The CA HIPC model of direct sales failed for a variety of reasons, the two major being; 1) too many options (i.e., not a commodity sale), and 2) lack of ability for purchaser (employer) to get quote quickly and easily.
As for speaking with carrier people, not always a reliable source of information. As for their belief that there will still be a role for agents...what did you expect them to say?
With commissions reduced/gone, a broker who wants to stay in the employee health business needs to either; 1) add a consulting fee--good luck here, or 2) sell self-funding.
As I said earlier, just me two cents.
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Good post, if it's a commodity with three plan designs all the same across the carriers and a mandate to buy online through an exchange (through federal law), no need for an agent. And it also destroys competition and innovation in the market, but that's another issue.
The arguement I hear for the death of the small group market is that employers will drop coverage since they are no longer required to offer it. They could do that now, I don't believe that's the real threat. The real threat is for blue / gray collar workers (or anyone who will be subsidy eligible) currently getting coverage through a group plan. Even if the employer is paying 50% of the employee cost, the employees may find it less expensive due to income subsidies to purchase in the exchange. It won't take long for employers to catch on and drop their plans. Higher income groups won't be as effected by this, but the rest will.
This could also take effect with large employers with a lower income workforce if their workforce qualifies for substantial subsidies (they can pay the fine and the workers will be fine with the government paying the subsidy). However, that will simply come down the numbers for each group.
A few "X" factors still out there for the health agent:
1. What modifications will take place between now and 2014?
2. Will there be a market for individuals not qualifying for a subsidy in the exchange? Will it be allowed? Will it be a big and profitable enough market?
3. Will comp be provided inside the exchange? (doubt it)
I mostly agree.
No employer is REQUIRED to offer coverage. Current wording says that 50+ who do not offer coverage pays a fine (sliding scale based on number of ee's), 200+ groups must enroll all employees (but employee could opt out), and for groups under 50, exempt from these penalties.
