The former head of the agency overseeing implementation of the health care reform law disagreed with state officials Friday over the need for insurance agents to be involved in the purchase of health insurance once the exchange system kicks in come January.
“The beauty of the exchange system is that if it works, you don’t have to use an agent,” said Jay Angoff, the first head of Office of Consumer Information and Insurance Oversight at the Department of Health and Human Services in comments at a panel discussion over how the states are faring in implementing the law.
“You can go directly to the Internet, you don’t have to use an agent, and if you want to use an agent you can, but you don’t have to,” Angoff said.
“I would hate for exchanges to build in the extra expense that requires people to use an agent that raises the price of insurance to be more than it should be based on the electronic system,” Angoff said.
Mila Kofman, executive director of the Washington, D.C., Health Benefit Exchange and former Maine insurance commissioner, and Rep. George Keiser, R-N.D., and former president of the National Conference of Insurance Legislators, disagreed.
Kofman replied to Angoff by saying that under the exchange being created by the District, consumers and small businesses can purchase health insurance without using the exchanges, and that D.C. residents and businesses won’t be charged for using agents to get help. “The cost is built into the price health insurers charge, and is based on a per-member, or per-month fee,” she said.
“We believe strongly, and we are different from other states, in maintaining the integrity and value of the agents and brokers, who are licensed, regulated and knowledgeable about health-care sales, as we about implementing the exchange in North Dakota,” Keiser said.
“In the District, which is pretty similar to North Dakota, we are relying heavily on the insurance agents and brokers, building them into our information technology for the exchanges, so a consumer using our online application system who wants to talk to a broker, have questions about the different policy choices available to them, they can just click on the button and choose among licensed, trained health-care insurance brokers for help,” Kofman said.
Angoff, now in private practice in the district as a partner at Mehri & Skalet in Washington, D.C., was the first head of the Office of Consumer Information and Insurance Oversight at the Department of Health and Human Services.
He left the agency last fall.
The different views on how states are implementing the exchanges and the role they foresee for agents and brokers in the exchange took place during a National Press Club Newsmakers program: Obamacare on the Ground, How is the Affordable Care Act Taking Shape in the States?
The law, the Patient Protection and Affordable Care Act (PPACA) mandates establishment of health insurance exchanges in every state by Oct. 1.
The system goes into effect Jan. 1.
The law requires every exchange – whether state-based or federally-operated – to have a navigator program.
The law says that navigators must comply with any licensing, certification or other standards required by states.
At the same time, NCOIL, which held its spring meeting over the weekend, adopted a resolution urging local policymakers to establish a state-based regulatory framework for navigators and in-person assisters that would ensure a strong role for agents.
The resolution urges states to utilize their authority to ensure that navigators are subject to the jurisdiction and oversight of state officials, and was lauded by officials of the Independent Insurance Agents and Brokers of America (IIABA).
“The IIABA welcomes NCOIL’s recommendations concerning navigators and strongly agrees that states are best suited to oversee this new category of entity and protect consumers,” said Wes Bissett, IIABA outside senior counsel, government affairs. “Ensuring that there is proper scrutiny over navigator qualifications and behavior is good public policy.”
In their comments at the NPC Newsmakers event, Keiser and Kofman agreed.
“We have grave concern in North Dakota about creating thousands of navigators out there that were offering an additional service, such as AARP, Chambers of Commerce, labor unions, who did not understand insurance but were out there giving insurance advice with no ability to control once it got out of the box,” Keiser said. “They have no regulatory authority,” Keiser said.
“So we felt strongly that we should maintain the integrity of the 21,000 insurance agents and brokers in our state,” Keiser said. “It wasn’t fence-building. We believe that providing advice on health insurance is extremely important.”
Keiser said North Dakota provided a commission structure within the federal exchange it will use so that agents can be compensated, but acknowledged that that doesn’t mean that citizens can’t still independently use the exchange.”
Kofman said one aspect of her job is helping people determine whether they are eligible for Medicaid and to figure out whether they are eligible for premium tax credits. “We are focused on the brokers to help people figure out what is the best health plan option that is best for that family or that small business,” she said.
She called it a “two-pronged approach.”
Kofman said that, “We realize health insurance is very complicated, it not like buying a car, you can’t kick it or test-drive it for a short period, and know ahead of time if it is going to work for you. So we are relying on the expertise of professionals.”
She said their help “is going to be critical to help consumers who may have never been insured before, or who may not have ever used a health insurance agent when they were insured to make the best possible health insurance decisions.”
Kofman said that, “Moreover, we view our brokers as experts available to help people after they enroll. There are always issues, for example, sometimes you get your medical cards late, they don’t always arrive on time, or a claim is denied, so we view our brokers as expert people who help consumers even after enrollment.”
At the same meeting, Sen. Neil Breslin, D-N.Y., said that in New York, “We are trying to make sure that navigators are objective, don’t have an interest, are not likely to be questioned on the advice they give.”
So far, he said, “that seems to be working well.”
In general, he said New York is seeking to make that navigators are giving people advice as to what is the best health-care plan, and that the is given by people who can be objective when they give that advice, there are no conflicts of interest and they act to ensure that the right decision is made.”