Today’s Politico article focuses on the shrinking commissions for insurance agents under federal health care reform, and quotes NAIC consumer advocate Tim Jost. Jost compares the role of health insurance brokers to that of travel agents 10 years ago, and implies that –- just like consumers’ dwindling need to purchase airline tickets from travel agents -- consumers no longer will need insurance agents to sell them policies when state exchanges come online in 2014.
We don’t buy this argument. For one thing, it assumes that agents are merely sales associates, which we know is not the case. Consider this: The purchase of an airline ticket to visit the NAIC Central Office in Kansas City involves a fairly simple transaction that provides you with a one-time benefit: to reach your destination. On the other hand, if - after purchasing a health plan -- you develop a serious medical condition (or even require routine medical care, for that matter), then you will require contact with multiple parties: care providers, billing agents, an insurer and perhaps government bureaucracies for weeks, months or even years.
The role of the agent isn’t just to help with the selection of a policy to cover the cost of care, it includes serving as the consumers’ advocate when problems arise, identifying cost-saving opportunities and keeping consumers apprised of new changes to the industry that may impact them.
A 2010 survey of NAIFA members who handle health policies found that they receive an average of 223 requests for assistance each year from clients who are having difficulty resolving health insurance claims. And our survey just dealt with claims issues. Members have told us they spend countless hours providing customer service in other areas, such as explaining coverage options and navigating government benefits. The agents are experts on the health insurance industry and its products; they are well educated, highly trained, and tightly regulated. They develop personal relationships with their clients and become familiar with clients’ individual needs. Consumers simply cannot get anywhere close to the same level of service from a government or insurance company 800 number.
As NAIFA President Terry Headley told Politico, “The unintended consequences [of marginalizing healthcare agents] will be less competition, a disrupted service industry and significantly reduced customer service.”
The health care system is getting ever more complex with new levels of government involvement. And anyone who has suffered an illness or injury knows that you can’t get proper medical coverage or care simply by purchasing a ticket. Sometimes the assistance of a professional agent can make all the difference.