After cutting funds for nonprofits that help people obtain coverage under the Affordable Care Act, the government is encouraging the use of insurance agents and brokers.
WASHINGTON — After cutting funds for nonprofit groups that help people obtain health insurance under the Affordable Care Act, the Trump administration is encouraging the use of insurance agents and brokers who are often paid by insurers when they help people sign up.
The administration said in a recent bulletin that it was “increasing partnerships” with insurance agents and viewed them as “important stakeholders” in the federal marketplace, where consumers are now shopping for insurance. But some health policy experts warned that a shift from nonprofit groups, which are supposed to provide impartial information, to brokers and agents, who may receive commissions for the plans they recommend, carries risks for consumers.
“Insurance agents can educate consumers about the marketplace, and that is a good thing,” said Sabrina Corlette, a research professor at Georgetown University’s Health Policy Institute. “But I worry that they work on a commission and therefore have a financial incentive to steer consumers to particular products, which may or may not be in the consumer’s best interest.”
In its bulletin, the administration said agents and brokers who are registered with the federal marketplace can “get sales leads” and new clients. And it offered them tips for “making the most of your marketplace participation during this open enrollment period,” which runs through Dec. 15.
Consumers can get contact information for agents and brokers, as well as nonprofit groups known as navigators, by clicking on “Find Local Help” on HealthCare.gov.
From there, consumers can connect with a service the administration added this year specifically to connect them with licensed agents and brokers who can provide immediate assistance.
“Get help now!” says a federal website describing the new service, called Help on Demand. “A marketplace-registered agent or broker will contact you in 30 minutes or less to help you enroll. Agents’ and brokers’ services are generally free to you. They’re usually paid for by insurance companies.”
More than 43,000 agents and brokers have received training and been certified to sell health plans through the federal marketplace. Their advocates said they could provide a lifeline for consumers in a confusing and troubled marketplace.
Michael Lujan, a former president of the California Association of Health Underwriters, called agents “the unsung heroes of health care and the marketplace.”
“The Trump administration set out to sabotage the Affordable Care Act by defunding many of the nonprofit navigator groups,” Mr. Lujan said. “Agents can help fill the gap.”
Agents and brokers can recommend specific health insurance plans and typically receive commissions paid by the insurers whose plans they sell. By contrast, nonprofit navigators and other “assisters” cannot recommend specific plans. In fact, the Trump administration recently warned navigators that they could not accept payment from an insurer and could not be paid even by their own organizations on a per-application or per-enrollee basis.
The website for the Help on Demand service is operated by BigWave Systems, a privately held technology company in Colorado, “in partnership with HealthCare.gov,” the federal marketplace.
Personal and financial information provided by consumers is confidential. But an assessment prepared by the Department of Health and Human Services says, “BigWave Systems makes no warranties or representations regarding the security of the data submitted to the Help On Demand application, and use of the Help On Demand website is at the consumer’s own risk.”
Marcia Benshoof, a spokeswoman for BigWave Systems, said that personal information was encrypted and stored behind a firewall and that there had not been any unauthorized disclosures.
The administration has reduced funds for the navigator program by 41 percent, to $36.9 million, from $62.9 million last year. Among the states hit the hardest, according to data provided to Congress by the administration, are Georgia, down 61 percent; Michigan, down 72 percent; New Jersey, down 62 percent; and Ohio, down 71 percent.
A survey by the Kaiser Family Foundation found that insurance agents and nonprofit navigator groups differed in some ways. People using agents last year were less likely to be uninsured and less likely to have income low enough to qualify for Medicaid, it said.
California has had one of the most successful health insurance marketplaces in the country, and has studied the lessons to be learned from its experience.
“Agents are funded by health plan commissions and do not have an incentive or the resources to promote the overall marketplace,” said Peter V. Lee, the executive director of the state’s exchange. But he added, “Many of them are small-business owners who are trusted voices in their communities,” and they have enrolled hundreds of thousands of people in California.
Agents enrolled 47 percent of the people who had coverage this year through the state-run insurance marketplace known as Covered California. By contrast, nonprofit navigator groups generated about 3 percent of enrollment, according to the agency that runs the state marketplace. Many customers said they had bought insurance on their own without receiving assistance.
Patricia R. Martin of Chardon, Ohio, said she had always had health insurance through a large company for which her husband worked. When he died suddenly at 54, she said, she had to find other coverage, and a local agent provided invaluable assistance.
“Health insurance just boggles my mind,” Ms. Martin said. “It’s fine to go online, but I’d much rather deal with a person. I have complete faith in my agent.”
The open enrollment period for the federal marketplace lasts 45 days. But Nicholas A. Moriello, an insurance agent in Delaware, said agents “do marketing and outreach to customers” throughout the year and typically receive a commission or fee for each month that a consumer remains enrolled in a health plan.
“Agents and brokers are able to provide our recommendations to consumers, and that’s something they’ve really needed in trying to evaluate their choices,” Mr. Moriello said. “But in the same way that federal funding has been reduced for navigators, insurance companies all around the country have reduced the compensation that they pay to agents and brokers, and in some states they have eliminated it altogether. So I fear that in this year’s open enrollment, there may be a reduction in the number of agents and brokers for consumers to turn to.”
But with rising premiums, shrinking options and much confusion, consumers need more help.
Kelly L. Rector, an insurance broker in O’Fallon, Mo., near St. Louis, said many of her clients were “being required to give up their physicians” because Anthem Blue Cross and Blue Shield was pulling out of the local market and a company entering the market, Centene, had “a slimmer network with fewer doctors to choose from.”
Besides an increase in premiums for 2018, Ms. Rector said, “the biggest issue for some of my clients is that they will be unable to continue to see any of their current doctors.”