Producers to Play Diminished Role in Exchanges

[Dave020]

Watch California carefully. I had lunch with the 'private' exchange in CA today and found out that a part of the new exchange legislation in CA virtually eliminates agents/brokers from the equation and replaces them with non-licensed navigators.

Also, the guy who ran Mass Connector is involved in the CA exchange set up (Kingsdale). Mass pays 0% IFP and 2% group commissions.

 

[AllenChicago]

This http://www.kff.org/healthreform/upload/7962-02.pdf report says that the tax-credit subsidies will be "advanceable".

Rush Limbaugh said last week that the tax credits would be paid directly to the insurance company on behalf of the insured on a month-to-month basis.

I would assume that the Treasury Department would receive a notice from the insurance company stating that the insured has paid their share of the monthly premium. The Treasury would then make a direct deposit to the insurance company for the remainder of the premium.

This whole subsidy business has the potential to be the mother of all nightmares for insurance companies and the insureds. Thousands of medical claims will be denied because the full premium wasn't received in time from one, or both paying parties. Personal misery and lawsuits will increase exponentially.

 

[Ron Van D]

My questions from day on the exchange and tax subsidies is
Will the insured have to pay the premium and then get the tax credit at the end of the year?
Of does the subsidies reduce the premium for the insured?

I have wondered the same thing. My totally cynical take is that it will be a credit. Since most will not be able to afford the premiums, no one will be able to take the credit. Thus, the problem of too many uninsureds will remain. Therefore, the feds will have no choice but to take over the health care system, since, when given the opportunity to play nice, the dirty, rotten insurance companies just gouged the poor.

 

[stuy119]

If it were a monthly subsidy, the IRS would need to verify insurance on a monthly basis. From what I remember reading, the IRS is only checking annually to see if you have insurance under the premise of levying a fine.

No matter how it happens, it's a mess.

And that's truly scary Dave. There are enough insurance agents who don't understand plan design out there, let alone someone who is unlicensed. Hopefully it doesn't become too big of a mess that can't be undone or brought right at some point.

 

[CHUMPS FROM OXFORD]

I always said that the "Public Option" was not our greatest threat. But the "Exchanges" were.

Oddly, Norvax, Quotit and any other major companies that have health quote engines, will be on our side for this battle.

 

[Full Throttle]

It will likely work just like the COBRA subsidy. For small groups with under 20 employees, the carriers in my state charged the non-subsidy portion from the insured and collected the difference from the government. As much as I disagreed with the subsidy program, we had zero issues with claims being denied due to waiting on payment from the federal government.

 

[VolAgent]

This whole subsidy business has the potential to be the mother of all nightmares for insurance companies and the insureds. Thousands of medical claims will be denied because the full premium wasn't received in time from one, or both paying parties. Personal misery and lawsuits will increase exponentially.

I believe you are slightly mistaken. No sane insurer would deny a claim because the Federal Government was slow in paying the subsidy. The PR nightmare alone would prevent it. And despite how much we all hate the government, they have never defaulted on a payment.

 

[Norwayguy]

I'm surprised the States would give up the control it has by using non-licensed Navigators...I wonder if these navigators would be "Appointed" by the carriers and that the appointment fees would flow to the states as they do now.

 

[VolAgent]

I'm surprised the States would give up the control it has by using non-licensed Navigators...I wonder if these navigators would be "Appointed" by the carriers and that the appointment fees would flow to the states as they do now.

Good point. A lot of state jobs and state money depends on license and appointment fees. In this economy, it is hard to believe they'd give that up without a fight.

 

[stuy119]

I'm surprised the States would give up the control it has by using non-licensed Navigators...I wonder if these navigators would be "Appointed" by the carriers and that the appointment fees would flow to the states as they do now.

You're surprised that CA would do that? They haven't shown themselves to make intelligent fiscal decisions over the past 40 years or so, so why start now?

Other states will make licensing mandatory, and then we'll have a giant mess on our hands.