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ACA Pressure Coming Down on Insurance Agents

Continuing Consumer Health Care Confusion

Websites such as quote plenty of encouraging numbers about the Affordable Care Act:  

  • Eight million people signed up during the 2014 open enrollment period

  • An estimated 11.7 million signed up during 2015 open enrollment (including 4.5 million who re-enrolled from 2014)

  • An uninsured rate of 11.9 percent for the 18 – 65 demographic in the first quarter of 2015 (down from 2013’s high of 18 percent)

However, “consumers don’t understand health insurance, let alone key aspects of the landmark health law,” according to Forbes, and this could lead to consumers making the wrong choices in benefits.

Drew Altman, president and chief executive officer of the Kaiser Family Foundation, cites some sobering statistics:

  • 37 percent of enrollees don’t know the amount of their (likely sizable) deductible

  • Although 85 percent of enrollees receive a subsidy, only 46 percent realize it

  • Many enrolling in the marketplaces lack “health insurance literacy” and do not understand insurance terms such as:

    • Premium

    • Deductible

    • Co-payment

    • Coinsurance

    • Maximum annual out-of-pocket spending

    • Provider network

    • Covered services

People will “learn as they go,” but a lot of the education burden falls to health insurance agents.

ACA, Medicare and Health Insurance Leads

Nothing about the ACA makes selling health insurance easier. Given the confusion over Medicare coverage, rising premiums and lack of cost of living adjustments, agents have their work cut out for them. According to Healthcare Reform Magazine, the PPACA “…plays a vital role in devising the course and meeting the vision and objectives of” Medicare. Nonetheless, people are confused about how Medicare and the Health Insurance Marketplace interact. Insurance Forums aptly described the PPACA as “the number one headache for producers,” noting one positive of the situation: “The agent who can educate and service clients, despite this complex set of rules and standards, within the given tight time windows, might just be a superhero.”

Navigating Regulations

Finding new health insurance leads is never easy, and dealing with regulatory changes further complicates the process. Knowing the ins and outs of the ever-changing regulations presents a unique and potentially lucrative opportunity for motivated agents. Despite initial concerns that the ACA spelled out doom for the future of agencies, the University of Houston Health Law & Policy Institute notes that there is still a demand for brokers and that policymakers must consider the benefits brokers provide, such as facilitating exchange operations and assisting with outreach programs.

Making ACA Work

For many agents, success requires not only pursuing more Medicare insurance leads but also carving out a specialty niche that caters to the needs of a specific component of the market. Entrepreneur notes that numerous agencies realigned their practices to specialize in helping businesses with ACA requirements. Other opportunities abound, such as critical illness, or CI, insurance to fill in some of the coverage gaps that occur when individuals face serious ailments.

No matter the specialty area, creating business requires creating leads through various channels, including networking events, social media, email, websites and even direct mail. Just be sure you make the right choice of areas. Producers eSource recommends a three-step Niche G-E-L Formula:

  1. G for Growing: find an insurance market that is growing and under-served

  2. E for Experience: consider your specific experience in an area

  3. L for Love: having a passion for your chosen market goes a long way in achieving success

Whatever the niche – high-risk health problems, helping seniors with changes to Medicare Part D or something else – if it is growing and you know it and love it, go for it.

Politics and Medicare

For better or worse, politics and health care law are now inextricably intertwined. “Obamacare” proved an incredibly polarizing political force. As a result, depending upon the outcome of the upcoming elections, an entirely new set of regulations regarding health care markets as well as Medicare may arise. Some potential candidates want to build out from the ACA while others want to phase out Medicare. No matter who becomes the next president, be prepared to deal with new regulations and laws. 

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