If agents have to talk about all exchange plans, maybe all exchange plans should pay agents, Lee says.

The head of California’s state-based health insurance exchange says the U.S. Department of Health and Human Services (HHS) should think about changing HealthCare.gov agent and broker compensation rules.

Peter Lee, the executive director of Covered California, says HHS should “research the value of potentially setting a minimum commission amount, so issuers are contributing at least a similar portion of premium to this important enrollment channel.”

Insurance company executives have argued that suspending active marketing of exchange plans in the middle of the year is just about the only defensive measure they can take when they learn that the exchange plans they are offering are drastically underpriced.

Lee says HealthCare.gov requires exchange producers to tell consumers about all available exchange coverage options.

Setting producer compensation standards is particularly important given the requirement that agents tell consumers about all of the available HealthCare.gov plans, not just the plans from the issuers that pay commissions, Lee says.

Lee made the recommendation in a letter he sent Friday to HHS Secretary Sylvia Burwell. Covered California included a copy of the letter in a board meeting packet.

The Centers for Medicare & Medicaid Services (CMS), an arm of HHS, recently asked for comments on proposed PPACA program benefit and payment parameters for 2017. The parameters would apply directly only to HealthCare.gov, the exchange system that HHS set up for states that are unwilling or unable to handle the Patient Protection and Affordable Care Act (PPACA) exchange enrollment process.

But “we want all marketplaces across the nation to be successful and make these comments to contribute to building on the success we have already seen across the nation in the initial launch of federal and state-based marketplaces,” Lee says.

In addition to suggesting that HHS should consider setting an exchange producer commission floor, Lee says HHS should:

  • Prohibit an issuer from having different agent compensation levels for consumers who come in during the open enrollment period and those who qualify for special enrollment periods outside the regular open enrollment period.

  • Prohibit an issuer from cutting off agent enrollment commission payments. 

Earlier this month, Sharon Clark, the Kentucky insurance commissioner, said in an advisory opinion that she believes that a health policy commission structure is part of the policy rate filing, and that changing commission terms without getting a change in the rate filing approved violates the state’s insurance code.

See also:

PPACA World 2017: How it’s supposed to work

UnitedHealth to avoid 2016 public exchange plan sales

 

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