Person-to-Person Assistance, Especially Through Agents, Is Vital to Promoting Covered CA Enrollment.

Most of Covered California’s enrollment comes from a range of channels that provide person-to-person assistance to help people enroll. At Covered California, about 40 percent of all enrollment is from consumers who enroll directly through the website (CoveredCA.com) (see Figure 10: Covered California 2017 Enrollment by Service Channel), but most consumers want and need personal assistance with enrolling.

The biggest single channel for enrollment is through Certified Insurance Agents who are paid directly by health plans through commissions. Agents enroll 47 percent of Covered California’s consumers. These are trained and licensed professionals who operate storefronts and do in-person retail sales. It also includes web-based entities. All agents must be certified by Covered California.

Some health plans have decades of experience funding agent channels to attract and enroll consumers. Covered California has successfully
established a variety of programs to promote and partner with agents.  Covered CA Report

Brokers Leave ACA – Obamacare as commissions go unpaid Modern Health Care 4.5.2017

Full Story – CA Health Line 2.18.2016

Covered CA letter to Secretary Burwell 2 pages  pdf

FAQ’s

What does it mean for me to appoint you my agent? Who is responsible to pay your agent fees in that case?

I am happy to appoint you my advisor, I am uncertain if I can afford your rates… please explain how it works. Many thanks.
 

One comment on “Covered CA Protecting Agent Commissions?

  1. Kirk . . .

    Just want to set the record straight.

    Concerning the article referenced below about Executive Director Lee standing up for agents, the article states at one point: “Lee said it has become apparent to him that some insurers are trying to avoid sicker customers by slashing their payouts to agents.”

    While this statement makes for interesting headlines, an act such as this has been unlawful as an identified “discriminatory practice” in the Insurance Code for many years, and it IS NOT HAPPENING in California — not in 2016, not in 2015, or 2014, or in any of the years predating CoveredCA’s operations. It does not affect current agent compensation one iota. Agent compensation was slashed by as much as 75%-80% in direct response to the 80% Medical Loss Ratio embedded in the PPACA. In the years prior to the enactment of the PPACA, health insurance commissions ranged upward of 20%-25% of annualized premiums.

    There is no underwriting of individual health insurance in California. Insurers have no way of identifying “sicker” persons prior to actually encountering their medical expenses, because no health questions are asked during the enrollment process. So there is no way to alter the compensation paid to agents.

    Additionally, agents do not receive differing compensation based on open or special enrollment periods. Only Kaiser pays agents a flat $100 per new enrollment and $0 for renewals, a significant departure from the other players who all pay about 4% of premium for new and renewal business. HealthNet is the only company that first deducts all fees and taxes from premiums prior to calculating commissions, the others pay on the gross commission amount, so while HealthNet pays a 4% commission, it is actually a smaller effective rate compared to the commission practices at the other insurers I represent.

    Perhaps Executive Director Lee can address the Kaiser and HealthNet compensation issues specifically.

    MAX

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