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Life Health > Health Insurance

On the Third Hand: PPACA 2016

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Many readers loathe the Patient Protection and Affordable Care Act (PPACA) as a whole and the PPACA public health insurance exchange system in particular.

Some at least respect the goals of PPACA and have feelings ranging from a sincere interest in overhauling and improving exchange operations up to a sense that the exchanges they personally work with are creaking along reasonably well, under the circumstances.

Some have no strong opinions about either PPACA or the exchanges and just wish the exchanges or exchange plan issuers they work with would send them the minuscule commission payments that they were supposed to be paid for the policies they sold last year.

Let’s assume, for the sake of discussion, that at least part of PPACA will survive in 2016.

On the one hand, one challenge with discussing PPACA is that many people think of the PPACA exchange system as being PPACA. Of course, PPACA is a huge law that affects many activities of little interest to people in the commercial health insurance community. Few readers here have strong opinions one way or the other about assistance for medical professional education support programs, for example. 

Even in the commercial health insurance market, PPACA has many provisions that have no obvious connection with the exchange program, such as the provisions that require issuers to sell coverage without taking personal health status information into account, and without using personal health status information other than age and tobacco use when pricing coverage.

On the other hand, it looks, so far, as if running a public exchange costs at least $100 per user per year even in the states with efficient, well-managed exchanges, and more in some other states. In some of the states with the most successful exchanges, much of the business is coming from brokers.

On the third hand, one question that comes to mind is: Even if the rest of the PPACA commercial health insurance access provisions survive, should the public exchange system?

Would the uninsured be better off if the U.S. Department of Health and Human Services (HHS) and Internal Revenue Services continued to run whatever databases absolutely must be kept under government control and let private companies take over providing any other health insurance exchange services consumers happen to want?

And, in some markets, is it possible that consumers would be better off if, for example, insurers had to pay a solid commission to any broker who submitted any individual major medical application?

If, say, all insurers paid a 15 percent first-year commission on all major medical applications, is it possible that agents and brokers would be out voluntarily searching the nation’s homeless shelters and highway underpasses for prospects, without any noteworthy concerns about computer system glitches or vendor contracting procedures?

See also: View: What does Obamacare look like over the long run?


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