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On the Third Hand: Broker skin

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An idea: Maybe Gary Cohen, the director of the Center for Consumer Information & Insurance Oversight (CCIIO), should seek the statutory authority to give the agents and brokers who sell health insurance exchange (HIX) plans HIX stock, or, if that’s not politically physical, HIX phantom stock.

Whether producers actually own shares that trade under the symbol NYSE:HIX or Nasdaq:GARY, or they just have contracts that give them a sliver of the HIX system operating profits, giving the producers a stake in HIX would suddenly give them a new reason to care about the HIXen (HIXes? HIXi?); a way to get their brains around how the HIX works; a financial reason to want the HIXen to succeed; and an incentive to enroll eligible people in the HIXen, or at least work to maximize the effectiveness of whoever it is doing the enrollment.

That thought came to mind as I was watching Web videos of Cohen and U.S. Health and Human Services (HHS) Secretary Kathleen Sebelius trying to play hearing chess with members of Congress during an endless succession of HHS budget hearings.

Republicans haven’t been able to stop HHS from implementing the Patient Protection and Affordable Care Act (PPACA) through lawsuits or repeal bills. The current strategy seems to drag Cohen and Sebelius into so many hearings that eventually they will say something stupid, vomit or burst their bladders on camera and will have to suspend implementation just because going ahead would remind the public of the embarrassing video.

I have no idea whether the PPACA exchanges or other PPACA provisions will work. I think that some of the so-called PPACA “reports” that the HHS planning arm and think tanks that are officially completely neutral but write like alumni of the North Korean Propaganda Correspondence school (click here and search for “marketplace”) produce are pretty infuriating. When PPACA backers write such blandly positive, complication-ignoring “reports,” it feels as if they are trivializing what they are doing and mocking the American people. It feels as if they think we’re too stupid to notice that they’re writing propaganda.

But, at the same time, love the exchanges or hate the exchanges: They’re not a North Korean plot. Many of us have bought MetLife stock through (gasp!) a centralized, highly regulated exchange — the New York Stock Exchange — rather than by handing a wad of hundred dollar bills to a worker in the treasury office at MetLife, or to a neighborhood securities market maker.

All kinds of people have proposed health insurance exchanges. Utah has a health insurance exchange. Florida had a health insurance exchange way back in the very early 1990s.

I would like the country to either completely kill the PPACA HIXen and figure out what we’re doing next, or let the HIXen come to life in some reasonably well-funded, rationally regulated form that gives them a chance to succeed because the exchange idea makes sense or fail miserably because , in this context, the exchange idea is actually a bad idea, not fail solely because the Republicans in Congress have crippled them with a $1 marketing budget.

One challenge is that successful exchanges would compete with producers, and many producers are understandably skeptical about whether the HIXen and their qualified health plans (QHPs) will be good either for them or for their customers.

One result may well be that CCIIO officials are so scared of taking any advice whatseover from insurance or producer groups, for fear of somehow being swindled or co-opted, that they end up taking advice from warm, friendly patient advocate types who are obsessed with the idea that health plans should offer consumer materials in Swahili and Telegu, and that lions should lie down with sheep, but not too familiar with the process of getting an enrollment system to work, or with the concept of adverse selection.

Meanwhile,  CCIIO is hoping that hundreds of thousands of producers will at least sign up to possibly enroll consumers in the exchange.

A thought: Find a way to create an actual federal HIX asset pool or phantom federal HIX asset pool. Set aside part of the value of the pool for the federal HIX producers. Let any producer who enrolls a minimum number of consumers in the HIX get a share of the earmarked portion of the asset pool.

Or, if there’s a sense that this approach would give producers too much of a bias toward the HIX plans, then create some kind of pool tied to the gains the country as a goal gets from reducing the number of people who are uninsured. Give all working health insurance producers a stake in the performance of the reducing-the-number-of-uninsured-gains pool.

On the one hand: Many producers would be too angry and skeptical to even consider working with HHS, CCIIO, the HIXen or any other programs meant to reduce the number of uninsured.

On the other hand: Maybe the producers who did participate in the pools would have a new incentive to help get uninsured covered; to make sure that any HIXen that do exist maximize their performance; and to come up with effective solutions if the HIXen aren’t so great.

On the third hand: I hate scary stories. I think I’m just going to close my eyes and put my fingers in my ears until about 2016, and let someone tell me how it all turned out then.

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