Members of Health Agents for America (HAFA) and other agent groups are worrying about an effort by Aetna Inc. (NYSE:AET) to shift to a new approach to small-group broker compensation.
Brokers have been arguing, in connection with the debate about what should and should not be included in Patient Protection and Affordable Care Act (PPACA) medical loss ratio (MLR) calculations, that customers are the ones who really pay brokers’ compensation.
Brokers have said that insurers simply collect the broker compensation from the customers as a courtesy to the brokers and the customers.
Now Aetna is saying that, in at least some markets, starting July 1, for groups with 100 or fewer lives, it will have brokers negotiate service fees with the clients, and simply administer collection of the fees for the brokers, according to a copy of a sample billing agreement posted by Kilpatrick Companies.
The Center for Consumer Information & Insurance Oversight (CCIIO) has encouraged insurers and brokers to take just that approach by coming up with seven steps insurers can take to get some producer comp payments out of MLR calculations.
On the one hand, many other intermediaries have to negotiate with consumers over their compensation. Why not health insurance brokers? Maybe brokers who are great negotiators will be able to get more from consumers than they could from insurers.
On the other hand, I think it’s reasonable to make the argument that health care and health insurance are unusual markets, because they involve complicated, opaque markets, and consumers often get their first detailed information about those markets when they are seriously ill, or possibly dying.
Advocates of a pure, or nearly pure, free-market approach may well prove to be correct when they say that government intervention eventually distorts health care markets and makes the situation worse than if patients and providers were left to work out their own deals. But most people, including many people, who, in theory, prefer a pure free-market approach hate to leave other people to die of a treatable health problem on the sidewalk. Some of the earliest written records we have relate to efforts by societies, such as ancient Egypt, to organize and pay for health care.
Similarly, it’s possible that most of us feel such a sense of deep pity for seriously ill people battling health care bureaucracy that, one way or another, we’ll have to find someone to help them navigate through the health care and health finance systems. Maybe we don’t want children to die of measles simply because their parents have no idea where to get their children vaccinated at no out-of-pocket cost.
One possible solution: If we generally do treat access to some level of health system navigation help as a basic human right, and society as a whole or specific tender-hearted people will have to bear the burden of paying for those services if healthy, solvent people fail to pay for navigation services, then become sick, maybe the PPACA system, or whatever comes after the PPACA system, should require any health plan to spend a minimum dollar amount, or minimum percentage of health care claims costs, on pre-enrollment and post-enrollment support services.
Maybe some entity could even create what amounts a health insurance helper exchange program within the health insurance exchange system, and let agents, brick-and-mortar brokers, direct insurance company enrollment systems, nonprofit exchange helpers, Web broker entities, and Chinese health insurance system hackers who are feeling generous compete for a share of the helper business. Maybe the entity could set the same level of compensation for all would-be insurance helpers, then have the helpers compete for business based on ability to improve patients’ satisfaction with plan customer service and access to care, rather than on compensation level.
On the third hand, there is the possibility, given how opaque the U.S. Department of Health and Human Services (HHS) has made many aspects of the exchange program and overall commercial health insurance market regulation, that HHS would just as soon consumers not understand how the system works.
See also: The opacity of nope
In which case, never mind.