Health insurance brokers get some good news from the state
As the Affordable Care Act inches closer to becoming fully actualized in the U.S., insurance agents and brokers are beginning to feel pressure concerning their livelihoods mounting. The federal health care law calls for the establishment of health insurance exchanges, which are meant to be virtual marketplaces where consumers can find affordable health care policies. Policies would be sold through the exchange, effectively eliminating any third party in the relationship between consumer and insurer, a fact that has many brokers and insurance agents worried.
New legislation will secure commissions for brokers and agents
Minnesota is one of the states that is taking this concern very seriously. A state Senate committee has introduced a new amendment to legislation concerning the Minnesota health insurance exchange. The state has chosen to develop its own exchange system, which will be populated with policies provided by the state’s major health insurance companies. According to the original legislation, the exchange system would withhold a certain amount of the premiums paid by consumers and determine how these funds would be distributed to brokers and agents, if at all.
Legislators work to ensure that exchange does not alienate brokers
The amendment to the state’s health insurance exchange legislation would ensure that brokers and agents have a role to play in the exchange program itself. Those that sell policies through the state’s exchange system would be paid directly by the insurance companies that represent. The payment arrangements between insurance companies and their brokers and agents would have to be fully disclosed to consumers, per the amendment’s provisions.
Amendment receives overwhelming support
The amendment was approved by a Senate committee earlier this week, with supporters claiming that it protects the historic role of insurance agents and brokers in the state. Legislators have, thus far, been unwilling to allow the state’s health insurance exchange to negatively impact a sector of Minnesota business that has long provided a valuable service to consumers.