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The California Health Benefit Exchange Board is scheduled to make vitally important decisions at its meeting here next Thursday that will determine the role played--and compensation earned--by insurance agents in both the individual and small-business exchanges starting next fall.
Under the federal Patient Protection and Affordable Care Act (PPACA), every state is required to establish a health benefit exchange designed to make it easier, starting Jan. 1, 2014, for individuals and small businesses to compare plans and buy health insurance in the private marketplace. The hope is that the Exchange will enhance competition and provide the pricing and competitive advantages enjoyed presently by large employer groups. The law includes the individual mandate to purchase coverage, and also provides subsidieis for low-income individuals and tax credits for small businesses (defined, initially, as those with fewer than 50 employees) to help them purchase coverage.
No health plan is required to participate in the Exchange, but most health insurers support the exchange concept and are expected to participate--because the combination of the mandate, the subsidies and tax credits, and efforts to attract large uninsured populations, have the potential to bring in millions of new customers. Every state is permitted to determine what "essential health benefits" must be provided under each of the federally designated bronze, silver, gold and platinum levels, but health plans will be required to offer the same standardized coverages whether in, or out, of the Exchange.
Federal law permits, but does not require, insurance agents to play a role in selling Exchange policies, but the architects of the California individual and Small Business Health Options Program (SHOP) exchanges have consistently stated they consider meaningful agent involvement not only desirable but essential to success of the Exchange.
The powerful Board of Directors of the Exchange is scheduled to meet from 9-5 next Thursday, July 19, in the auditorium of the Ronald V. Dellums Federal Building at 1301 Clay Street in Oakland, to make final decisions on payments to agents in the individual exchange, on establishment of the SHOP exchange, and also hear preliminary recommendations on policies for benefit designs, selection and oversight of the health plans that will be offered through the Exchange, and requirements for an internal service center that would assist consumers directly.
"We are cautiously optimistic," said IBA West General Counsel Steve Young. "Although many aspects of the PPACA are troubling, the organizers of the Exchanges in California have taken pains, at least so far, to ensure that agents have an opportunity to play a meaningful role in the operation of the individual and small-business exchanges here." IBA West is part of a coalition--including the California Association of Health Underwriters and the National Association of Insurance and Financial Advisors-California--that has provided extensive oral and written testimony at Board meetings for much of the last year.
To review a description of actions taken or recommended for adoption on the individual exchange, click here.
For a discussion of the actions proposed for adoption on the SHOP exchange, click here.
Next week's Board meeting will be webcast, click here to view the link. Any person who wishes to provide oral comments to the Board may do so by calling: (800) 288-8974. (To ask to make a comment during the "public comment" period on any agenda item, press * 1; you will hear a tone indicating you are in the queue for comment. If you change your mind and do not want to make a comment, press #. Each person is limited to two minutes per agenda item.
Materials available for the meeting are posted on the Exchange website at: www.HealthExchange.ca.gov no later than the Monday preceding the meeting.