Organizers of the new health insurance “Navigator” programs will probably have to reach out to traditional health insurance agents and brokers to make the programs successful.
Exchanges Subgroup officials at the National Association of Insurance Commissioners (NAIC), Kansas City, Mo., make that case in a draft white paper discussing the roles of Navigators and producers in the new health insurance exchange distribution system that could be created in 2014 by the federal Patient Protection and Affordable Care Act (PPACA).
Republicans are trying to block implementation of PPACA.
If the health insurance exchange provision, the Navigator program provision and related provisions take effect as written, PPACA will create a new health insurance purchase tax subsidy program in 2014. Consumers and small groups will be able to use the subsidies to buy health coverage through the health insurance exchanges.
A state could choose to have one or more exchanges within its borders, participate in a multi-state exchange program, or let the federal government take charge of its exchange program.
The Navigators are supposed to be nonprofit, impartial advisors who will help individuals and small employers compare exchange health coverage options and sign up for coverage.
PPACA states that the Navigators could include a wide variety of organizations, such as trade, industry, consumer or professional organizations. The Navigators also could be licensed insurance agents or brokers, Exchanges Subgroup officials note in the draft.
When states are implementing the Navigator program, they must consider the role that producers will play in organizing and running exchanges, and also how the producers will interact with the Navigators, officials say.
“There are many issues in this regard, but experience has shown that all issues must be considered with the firm belief that producers are crucial players in the success or failure of an exchange,” officials say. “Producers have a significant relationship of trust with the individuals covered by the small employer insurance market. There are also segments of the individual market that are better reached and represented by producers rather than consumer and industry groups.”
Relying on the existing producer system can also help exchanges save on overhead, officials say.
One question will be how working, commission-based producers can be paid to serve as Navigators, officials say.
One possibility is that employers could pay producer-Navigator
commissions for their employees, and some states might have to update their laws to allow that, officials say.
That approach might be especially useful if a small employer with an agent or broker decides to have employees get their coverage from the exchange system, officials say.
To let individuals who are or have been traditional insurance producers, exchanges and their regulators will have to develop guidelines for addressing concerns about inherent or potential conflicts of interests, officials say.
Officials add that someone must decide whether state insurance regulators should license or certify the Navigators. Otherwise, the Navigators may have trouble getting errors and omissions insurance, officials say.
“Depending on the scope of a Navigator’s role in assisting consumers in getting the coverage that is most appropriate for them, and then assisting them further in claims resolution matters, a consumer who is harmed by a Navigator’s error or omission should have some recourse,” officials say.
Subgroup officials also have developed a separate white paper on exchange system funding.
Operating costs for an exchange may range from a few million dollars per year to $50 million per year, and one possible way to fund those costs might be to sell advertising space on exchange websites, officials say.