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Life Health > Health Insurance

On the Third Hand: Data

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Kev Coleman is the kind of company starter who could cause nightmares for some health insurance agents and brokers in the world of the Patient Protection and Affordable Care Act (PPACA) and cure headaches for others.

The new PPACA health insurance exchanges are supposed to help individuals and small groups find health coverage as easily as they would buy airline tickets through Travelocity or TravelHero.

Coleman’s startup, HealthPocket Inc., runs — a website that tries to present the same kind of health insurance plan coverage and price information that the government’s site provides in a simpler, more convenient, easier-to-use, better-marketed format., for example, gave me very detailed plan availability information for Hoboken, N.J., but getting to the results took many, many clicks.

To get a rough idea of what plans in Hoboken cost through, all I had to do was enter my ZIP code.

While waiting for the PPACA exchanges and market rules to get going, “the key question for us is how consumers will respond,” Coleman said. “Health insurance is a topic consumers research only when they have to.”

To get consumers to take advantage of the new options that are supposed to be available through PPACA, someone — health insurers, the exchanges, the government, existing private exchanges, startups like HealthPocket, or, of course, traditional health insurance agents and brokers — have to get consumers to learn about the available options, understand the options, and make choices.

For traditional health insurance producers who’ve been making a living by simply providing the kind of information that provides and sliding a paper form in front of consumers’ faces, the future might be difficult.

Exchanges have talked about wanting to help the kinds of consumers who have no idea how to get Travelocity to work by sending out “assisters” who might make just $50 per application. Most health producers seem to turn green at the idea that anyone will have the energy to help those befuddled consumers sign up for coverage for $50 per head.

But, for those befuddled consumers, the question is where the money to pay for better service will really come from.

My sense is that most of the producers who read are on a higher plane of producer existence and that they actually provide much more sophisticated services: Information about federal and state laws and regulations; information about market trends; and, most importantly — either through open expression of opinions or subtle shading of their voice — clues about who actually pays on time, who gives policyholders and doctors too much grief, and who is, to be brutally honest, a little shaky.

My father, for example, is a travel agent who had to change the scope of his business because of that wondrous Travelocity.

He’s not really any better than Travelocity at knowing how much a particular airline ticket will cost — but he’s a lot better at warning customers which airline is discounting tickets sharply because its pilots are about to go out on strike.

On the one hand, I think that’s probably the real answer for producers wondering, “What will happen to me in PPACA World?”

Producers who simply bring Excel pricing spreadsheets to life will either have to figure out how to enroll large numbers of poor people very quickly (maybe through tables at supermarkets, or drug stores?), or else moving away from selling major medical coverage.

On the other hand, producers who know the kinds of stuff that could never dare put in its data, and HealthPocket would have no way whatsoever of finding out in the first place, may view the exchange website, or a company like HealthPocket, as a tool for educating clients enough about the basics that the conversation can move on to more sophisticated topics.

On the third hand, knowing the complicated reality that lies behind the spreadsheets takes some investigating, and people tend  to hate investigators.

In the long run, maybe the real challenge great producers will face is not so much competing with the exchange websites and HealthPocket sites of the world, but being clear enough that they give clients an accurate view of reality, but subtle and polite enough that regulators can’t crack down on them for being website.

A few years ago, doctors lobbied hard against health insurance provider network contract “gag clauses” that limited their ability to talk about health insurance plan rules and practices.

Maybe health insurance producers need to prepare for having to fight battles to protect their ability to give clients honest assessments of insurers, plans, exchanges and provider networks.

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