The story of the Affordable Care Act (ACA) public exchange system has been full of shocking twists and turns, but George Kalogeropoulos says he sees signs that 2019 sales could be strong.
Kalogeropoulos is the chief executive officer at HealthSherpa, a Web-based health insurance broker and ACA exchange agent support services firm.
The number of ACA exchange agents fell sharply in 2017 and 2018, as President Donald Trump entered the White House, and angry, loss-plagued health insurers backed away from both HealthCare.gov and the state-based public exchange programs.
This year, however, “we’re seeing a very strong recovery,” Kalogeropoulos said Friday in an interview.
HealthSherpa has the strongest presence in states that use HealthCare.gov, the U.S. Department of Health and Human Services’ ACA exchange enrollment and administration system.
Kalogeropoulos is hoping that new web broker connection services HealthCare.gov managers are adding will boost exchange plan sales even more, by increasing the odds that consumers who visit ACA exchange websites will actually buy coverage.
What HealthSherpa Does
HealthSherpa was founded in San Francisco in 2013 as Geozoning Inc., and Geozoning is still its official name.
The company operates as an insurance agency in its own right. The company earns commissions by selling individual major medical insurance to individuals.
The company also helps employers get their employees and dependents enrolled in health coverage.
Another arm of the company provides ACA public exchange plan enrollment support services for insurance agents, insurance brokers, and nonprofit organizations. The company is offering the support services for free during the ACA “special enrollment period” — up until Oct. 31.
The open enrollment period for 2019 coverage is set to run from Nov. 1 through Dec. 15.
HealthSherpa’s Own Performance
HealthSherpa is a privately held company. Kalogeropoulos declined to give specific figures about the company’s finances.
But more health insurers say they will pay HealthSherpa sales commissions in 2019, commission rates are rising, and sales commissions will be available in more markets, Kalogeropoulos said.
In Arizona, for example, HealthSherpa offered no commission-paying exchange plan issuers for 2018. For 2019, Kalogeropoulos expects to be offering plans from three or four commission-paying issuers.
Kalogeropoulos said he also sees independent retail agents showing more interest in HealthSherpa’s agent support services.
In August, for example, the number of agents who signed up for HealthSherpa’s agent support services was 84% than it was in August 2017, he said.
“Very few insurance agents are ACA-only,” Kalogeropoulos said.
But some agents find that making ACA exchange plan sales is a good way to increase sales of other products, such as dental insurance, vision insurance and property-casualty insurance, Kalogeropoulos said.
Managers of state-based ACA public exchange programs have declined to provide tools that HealthSherpa could use to sell subsidized exchange plan coverage directly to the people in the states served by those exchange programs. That may be due to a combination of technology development concerns, security concerns, cost constraints, and coolness toward out-of-state web brokers.
HealthCare.gov developed a limited connection to web brokers through a complicated “double redirect” system.
If a consumer started out on HealthSherpa’s website and wanted subsidized exchange plan coverage, HealthSherpa could then pass the consumer on to HealthCare.gov. HealthCare.gov was supposed to process the consumer, then send the consumer back to HealthSherpa to complete the sign-up process.
HealthSherpa has to use a call center to help consumers in states with state-based ACA public exchange programs who want to sign up for coverage, Kalogeropoulos said.
Making web shoppers talk to a call center to complete the application process cuts the percentage of shoppers who actually sign up for coverage, or “conversation rate,” by about 80% or more, Kalogeropoulos said.
The old double redirect process also cut conversion rates by 80% or more, Kalogeropoulos said.
HealthCare.gov managers tried to make the enrollment process more direct for the 2018 open enrollment period, and they’re trying to make the process even smoother, through an Enhanced Direct Enrollment project, for the 2019 open enrollment period, Kalogeropoulos said.
The project is supposed to use API software modules to let web brokers make HealthCare.gov services available through their own sites.
Kalogeropoulos is hoping the new tools will help HealthSherpa improve web shoppers’ experience and lead to a dramatic increase in conversion rates.
An improved experience could also lead to a big decrease in exchange plan enrollee claim costs, Kalogeropoulos said.
To improve loss ratios. “you want to make it as easy as possible for casual shoppers to actually buy insurance,” Kalogeropoulos said.
The consumers who are willing to go through a double redirect process, or talk to a call center representative, to buy health coverage are likely to be the consumers who know they already have health problems, Kalogeropoulos said.
— Read 5 Plot Twists From the New GAO HealthCare.gov Report, on ThinkAdvisor.