Crains Article on Broker Commissions Cuts

Crains Article on Broker Commissions Cuts

by | Nov 12, 2012 | Health Care Reform, Health Exchanges, Individual Exchanges, PPACA, SHOP Exchanges, Small Business Group Health, State Exchanges

Crains Article on Broker Commissions Cuts

Crains Brokers’ Commissions Face Uncertain Future. A quick comment on our quote in Crains “Crains Brokers’ Commissions Face Uncertain Future” today.  Insurers are indeed cutting back on services resulting in cost containement measures such as layoffs, outsourcing and significant broker commissions cuts.

A significant negative  development  is the NYS decision to not allow licensed Agents/Brokers in the Individual Exchange.  Many States such as Massachusettes, the inspiration for Health Care Reform, use a Connector which is  an Exchange or an independent state agency that helps Massachusetts residents find health insurance coverage and avoid tax penalties.   Instead NYS will allow Agents/Brokers to only work in the Commercial Exchange known as SHOP.  HealthPass is a good pre-cursor of the SHOP Exchange offering Small Businesses a Defined Contribution Health Plan of full options form Health Insurance, Dental, Vision to  Term Life Insurance and Disability.

The Individual Exchange will work with an “Assitor” or “Navigator”.  In NYS  Government and Non-Profit Agencies will comprise the “Navigator” which will only be allowed to operate in the Individual Exchange.  By design an income subsidy will only pass through this Individual Exchange an not on the SHOP Exchange.  Example:  a $50,000 Family Household of 4 can get approximately 80% credited.

The Federal Gov has  already spent $2.2 Billion on State Exchanges. And this figures does not include remaining States as there are only 19 States working on an Exchange for 2014.  The Exchanges will be built up for 2 years and then must be fully independent by 2016.  If 88% of small groups coverage purchased by Brokers acc. to Bostons Wakely Report in research study- Role of Producers and Other Third Party Assisters in New York’s Individual and SHOP Exchanges the distribution infrastructure is already there.  Access to care is not the difficulty in finding a plan its the very cost of the plan!  Why then does NYS decide to spend on building up new infrastructures? AgentsBrokers can easily outreach and council to uninsured as well.  In fact many small businesses such as construction, consulting services and dining have many uninsured that an Agent/Broker already has a relationship with.

Despite all this and the rapid changes in reshaping health care we remain optimistic and look forward to taking on a greater role in health care reform.
With more choice, our groups and their employees will need more direction, allowing brokers to take on more of a consultative role. Healthcare plans are not a simple purchase and one plan doesn’t fit all. By delivering the latest cutting-edge benefits technologies, continued consumer focus approach and leveraging our long time relationships with Benefits/HR/Payroll partners our role will be pivotal in being part of the solution.

Pulse Nov 2012 Quote MMS

 

 

Is NY Small Biz healthcare ill?

Is NY Small Biz healthcare ill?

by | Jan 8, 2012 | Health Care Reform, healthcare, NY News, Small Business Group Health, State Exchanges

In the wake of Empire Blue Cross’s recent major SMB changes the 2 new Crains article below point to the early shake up results.

Tough Decisions on Health Coverage

Insurance Good Luck

Empire’s  Small Group “simplification”  did indeed  cause groups to escape Empire’s rate increases and reduced plan selections.  Additional, not mentioned in the article was that groups are facing plan modifications such as Rx changes switch to % from fixed $ copay and loss of Walgreen/Duane Reades chains.  By being the largest insurer on the block heavy provider negotiations have been de rigieur as evidenced by loss of Westchester Medical Center for 14 months and counting.

Groups have been fortunate to find comparable alternatives despite these changes but we see little public evidence of concern form NYS legislature.  We are not seeing the long term vision to open up markets to strong national insurance competitors.  On the contrary we have deep concerns of allowing  the past 2 non-profits of GHI and HIP merger and latest talks of going for profit.

Lastly, the article makes mention of possible “Health Exchanges” entering the market and lowering rates.   Where is there  evidence  of this decrease?  I’m not seeing why an insurer working in an oligopoly environment with price controls would be motivated to lower rates.  Would Con Ed or Blue Bell lower rates in the 70s because now SMB can shop online??