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PPACA nap period: Can you get special?

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Insurers and agents are getting ready for the second annual Patient Protection and Affordable Care Act (PPACA) nap period.

Insurers, exchange managers and regulators created the system to keep the new PPACA restrictions on medical underwriting from letting consumers wait until they get sick to pay for coverage.

Many public health insurance exchanges, and many health insurers, are still holding the digital door open for consumers who missed 2016 individual major medical coverage open enrollment period deadline. In some states, consumers have to show that they had an application in the exchange enrollment system by midnight Sunday to get more enrollment completion time. In other states, consumers can get extensions by making a pinkie promise that they had technical problems, or by simply deciding to apply for coverage.

See also: Insurers and PPACA exchanges do enrollment time warp again

GoHealth, a Web broker entity, is one of the brokers trying to get out the word about enrollment extension periods. ”If you tried to enroll but are still uninsured, it’s not too late to get coverage,” Brandon Cruz, GoHealth’s president, said in a statement.

Once the extension enrollment periods end, people who want to buy major medical coverage for 2015 will have to show that they qualify for a special enrollment period (SEP).

The U.S. Department of Health and Human Services (HHS) could still create a broad SEP for consumers who are just starting to learn about the PPACA individual mandate penalty system, but even a tax SEP would probably end before people turn their air conditioners on.

What are health agents and brokers doing to fight the silence of the phones?

To learn about three major strategies, read on.

Metal level quadrants

1. Work hard at helping consumers qualify for SEPs.

Even before PPACA came along, typical major medical buyers were people who needed coverage because they had lost access to other coverage due to a move, the loss of a job, or aging out of access to parents’ job.

Last year, some major medical sellers said SEP sales amounted to just 10 percent to 25 percent of open enrollment period sales.

Jeff Smedsrud, the chief executive officer of HealthCare.com, a Web broker, has argued that the percentage would be closer to 40 percent if consumers understood the SEP system a little better and would simply apply for SEPs.

One drawback is that producers who try to help consumers qualify for SEPs may have to spend more time getting to understand the consumers’ lives, and the SEP process, than they would like.

Another drawback is that selling SEP coverage (like selling other PPACA-era major medical coverage) may pay less compensation than producers would like, if producers can eventually collect what they are owed.

The advantage is that producers will get a chance to demonstrate their superior customer service and advanced PPACA knowledge for consumers who (if they have moved recently) may need referrals for everything from new dental insurance to new hair stylists.

Beach

2. Look into selling short-term health insurance.

HCC Insurance Holdings Inc. and IHC Specialty Benefits are examples of insurers with executives who would love to talk to producers about getting into the short-term health insurance.

Short-term health insurance is available year-round.

See also: PPACA rules send consumers to short-term health market

One short-term health market drawback is that the applicants have to go through medical underwriting. Another drawback is that they cannot qualify for the PPACA premium subsidies that exchange users get.

But, for the right applicants and the right producers, those drawbacks may be blessings.

Applying for short-term health insurance can be quicker and easier than dealing with glitch-plagued exchange plan enrollment systems.

Dave Keller, chief marketing officer at IHC Specialty, notes that applicants who can answer the company’s five underwriting questions the right way can have coverage in place

The medical underwriting and the lack of having to comply with PPACA major medical coverage mandates help hold the cost down. A 57-year-old man in Philadelphia who qualifies to buy IHC’s Connect Net preferred provider organization (PPO) policy will pay only about $295 per month in premiums and will get a $3,500 deductible.

If the same man were ineligible for PPACA subsidies, he might have to pay more than $400 per month for a bronze-level exchange plan with a $6,000 deductible.

Before PPACA came along, the man might have complained about some benefits gaps, but now he might like the relatively easy access to a broad, national provider network he can get with short-term health insurance.

For producers who want to cross-sell, the fact that a short-term health insurance customer earns too much to qualify for a government subsidy might be one plus, and the fact that the customer is healthy enough to get short-term health insurance might be another plus.

Girl selling lemonade.

3. Consider selling related products.

All of attention given to PPACA and major medical may have reduced the already-limited amount of attention going to other critical, bread-and-butter products, such as disability insurance, dental insurance and vision insurance, and to supplemental products such as critical illness insurance.

The major medical nap period might be a good time to ask consumers whether, for example, they would be willing to trade their current salary for 98 percent of their current salary plus protection against loss of income due to a serious illness or accident. Producers have heard the question before, but, given how much trouble insurers are having at reaching middle-market prospects, not all consumers have.

See also: 7 ways to turn PPACA lemons into lemonade