Eric Wilson says it’s still possible to make a living selling individual major medical coverage.
Wilson, the owner of I Sell Health Inc., started the insurance agency in Romeoville, Ill., in 2004. He enjoyed several great years before the Great Recession came along in 2009, and President Obama signed the Patient Protection and Affordable Care Act (PPACA) into law in 2010.
See also: What’s under that PPACA World rug?
Insurers slashed individual business commissions in 2010, and Wilson (photo, right, ISellHealth.com) said he has been struggling to get back to where he was in 2009 ever since. He’s hoping he might finally get back to 2009 revenue levels in 2016.
Wilson, who operates in Georgia, Indiana, Iowa, South Carolina, Texas and Wisconsin as well as Illinois, is in a great position to report on what’s really been happening in PPACA World since the public exchange system came to life in January 2014, and major PPACA product design mandates and underwriting restrictions took effect.
He estimates that about 10 percent of his individual medical customers still have pre-PPACA grandfathered policies; 25 percent have transitional “grandmothered” policies; 40 percent have PPACA-compliant coverage purchased outside the public exchange system; and 25 percent have public exchange coverage.
Most of the public exchange coverage users are getting premium subsidies, and about half of those are getting the PPACA cost-sharing reduction subsidies, which help exchange users with income under 250 percent of the federal poverty level.
For a look at what Wilson has seen, read on.
1. The producer compensation situation seems to be stabilizing.
Wilson says he thinks the average level of compensation in the individual market may now be somewhere around 6 percent of premium.
After falling sharply in 2010, producer compensation seemed to stabilize at low levels for a few years.
Compensation per enrollee fell again in 2014, but the new PPACA underwriting rules made closing sales easier, and that compensated for the cut in per-enrollee compensation, Wilson said.
The shift to PPACA World rules also led to a huge wave of policy cancellations, and sales opportunities, in 2014.
“Last year was a windfall,” Wilson said.
This year, the number of cancellations is smaller, but “there are still quite a few,” Wilson said.
2. HealthCare.gov, and navigators, are not necessarily all that bad.
Wilson says he once had to persuade a client not to follow the advice of a navigator who wanted the client to lie about income to qualify for a tax credit.
But, in general, Wilson said, “most of [the navigators] are very good.”
Wilson said he does not see himself as competing with navigators for business. Producers and navigators “are two separate animals,” he said.
Navigators may understand the exchanges well, but producers know more about how to select a health plan that meets a consumer’s needs, Wilson said.
Similarly, he does see lingering consumer and provider confusion over which providers are in network, and provider frustration with low reimbursement levels, but it looks to himself as if PPACA-compliant plans are paying claims reasonably well, and reasonably promptly.
He had some trouble getting in to HealthCare.gov call centers in December, but no problems at other times.
He said that, because of PPACA minimum medical loss ratio (MLR) pressure, health insurers have had a hard time maintaining their customer service staffing levels. The reps there know what they’re talking about, but getting through to them is often harder than getting through to HealthCare.gov reps, Wilson said.
3. He wants to sell coverage year-round.
Regulators and insurers are trying to cope with PPACA’s limits on medical underwriting by letting consumers buy coverage only at certain times of the year, to reduce the risk that healthy consumers will wait until they get sick to pay for coverage.
Wilson said he wishes regulators would switch to the system Ohio used to have.
There, anyone could buy coverage during a brief annual open enrollment period.
Consumers who missed the deadline could also buy coverage on a medically underwritten basis outside the open enrollment period. That way, consumers had an incentive to enroll whether they were healthy or not, but they still had a way to get coverage year-round, Wilson said.