In the Medical Loss Ratio part of the Healthcare Reform Law of twenty-ten, the health insurance agent’s commissions were cut in half, or more in some cases. With a financial disincentive, health insurance agents are reluctant to services their business due to the loss in income. It is tough to move forward when your commissions are slashed in half. America still has a crisis out there and needs help. This is where health insurance experts come into the picture.
Just imagine, the year you need open heart surgery is when the surgeon’s salary was cut in half due to some mandates from Washington. Do you feel real comfortable going into surgery?
Of course, that is the extreme and probably not as likely. Health insurance agent commissions being slashed is not like having open heart surgery to the business owner; individuals and families. It is like an open heart surgery to the agent. In fact, it is surgery with a dull blade and no anesthesia to make the experience a little less tolerable. This is why some insurance agents have left the industry, completely.
Insurance agents that have decided to play the game by the new rules will come out stronger than before. In the meantime, it is picking up the pieces and starting over again. Some of the agents have started outsourcing some of the tasks so they can focus more on servicing clients on other products; in addition to health insurance. This enhances the relationships with their clients by bringing more to the table. It is a pain for a business owner to call multiple insurance agents at times. However, some will still keep the agents in place where they feel comfortable. Even if that means having multiple agents to protect their business.
The industry has made several attempts already to exempt the health insurance agent from the Medical Loss Ratio and have failed. There is some belief in the industry that the government and the insurance companies will slowly push the health insurance agent out of business. Even though businesses owner still need an expert for the job, agents will start distancing themselves from lower paid activities.
You will see some of them will step up to the plate and take the role of a consultant. They will still be there by the business owner’s side as their health insurance expert. Health insurance agents will now invoice the business for the time they actually put into that business. This is the same way other professionals conduct their business; such as CPA’s, Attorney’s, Business Consultants, etc.
Many business owners will like this approach because they see the value these insurance experts bring to the table and are willing to pay for it. Some insurance experts were grossly underpaid, even under old commissions prior to the healthcare reform law of twenty-ten. These agents bring so much more to the table for the business owners. This caliber of agents will move ahead with healthcare reform and continue to provide value for the business owners and their client base.