Maryland cool on Web broker helpers

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Should PPACA exchanges work with the first exchanges?Should PPACA exchanges work with the first exchanges?


The heart of the new Patient Protection and Affordable Care Act (PPACA) health insurance exchange system will be sales systems that resemble current Web broker sales systems.

Should states ask the Web brokers to help them enroll consumers in health plans?

Frank Kolb, policy director at the Maryland Health Benefit Exchange board, said many people who wrote to the board to comment about the idea of exchange relationships with “Web-based entities” (WBEs) are skeptical about the idea.

The board is setting up Maryland’s Maryland Health Connection PPACA exchange.

Many states and members of Congress have talked about making the PPACA exchanges, or Web-based health insurance supermarkets, tools that can do for health insurance what Travelocity and Orbitz have done from airline tickets, by forcing health insurers to compete harder for consumers’ business.

Companies like eHealth Inc. (Nasdaq:EHTH) and Extend Health already operate private Web-based health insurance supermarkets, and those companies have been trying to persuade states to view them as business partners who can help them get the most out of tight marketing, enrollment and administration budgets.

Almost all of the 37 exchange-WBE relations commenters agreed that the state should license and regulate WBEs, Kolb said.

Many commenters were nervous about WBEs, “some were completely against allowing WBEs to  partner with the exchange,” and many want the state to wait at least a year or two before they start working with WBEs, Kolb said.

Some said they thought the state would have a hard time regulating out-of-state WBEs, and some questioned whether WBEs could provide personalized service, Kolb said.

Some commenters said exchange-WBE relationships would disrupt the market, create consumer confusion and dilute the Maryland Health Connection brand, Kolb added.

Kolb said members of the Maryland exchange staff are asking how they should manage any WBE relationships that the exchange does have. 

“Should the [Maryland exchange] choose a restricted number of WBE partnerships or set minimum criteria for partners and allow all  to participate?” Kolb asked. “If a restricted number, how should the [exchange] fairly choose WBEs for partnership?”

See also:

  • PPACA exchanges start to line up distributors
  • Maryland exchange answers bidder questions
  • Maryland House passes PPACA implementation bill

 

Lawley, Liazon unveil private health insurance exchange

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Lawley Benefits Group is introducing a private benefits exchange that is intended to help employers manage their health care costs more efficiently while giving their employees more options in choosing the right coverage for them.

The exchange, known as Lawley Marketplace, is different from the public exchanges that are being created under the terms of the federal Affordable Care Act.

Lawley, an employee benefits broker and provider of consulting services, partnered with Liazon, a health-care technology company that designs private benefits exchanges, in setting up the portal.

Officials with the companies introduced the exchange to the Lawley sales force Tuesday afternoon in a meeting at WNED’s downtown studios.

Lawley and Liazon executives say the exchange helps employers, particularly those who have between 10 and 200 workers, by offering a streamlined administrative process and allowing them greater certainty in their health care costs.

Instead of a human resources official having to choose the handful of health plans that will be offered to a company’s employees, the private benefits exchange allows the workers themselves to select from a wider array of plan options, said T.J. Revelas, Lawley’s managing partner.

Lawley plans to heavily market the exchange in the Buffalo and Rochester markets, with an eye toward signing up companies and employees over the summer and early fall. The Martin Group worked with Lawley on the public-relations and advertising campaign.

The members of the sales team were shown a promotional video and watched as a Lawley official walked them through a demonstration of the online registration and selection process that an employee would use to choose his or her health insurance package.

Lawley executives compared the process of shopping for a health plan to the steps someone would take to buy something on Amazon or search for a mate on a dating website.

Ashok Subramanian, Liazon’s CEO and co-founder, said there are a number of other national companies that have started offering private benefits exchanges, but he contended that so far these are inferior or less comprehensive.

Subramanian also said the partners have learned a lesson as they’ve watched how the exchange has been used by employees in test cases. “People choose differently than companies specifically choose for them,” he said.

—Stephen T. Watson

VIEWS State-run health insurance; Why AFC opposes HB 3227

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The AIDS Foundation of Chicago (AFC) recently made the difficult decision to oppose legislation pending in Springfield that creates a state-run health insurance marketplace. We base this decision on the poor consumer protections in the bill.

House Bill 3227 (Senate Amendment 2) is backed by our partners, including Campaign for Better Health Care (CBHC), and is sponsored by Sen. Dave Koehler (D-Peoria), a long-time friend of AFC and champion for helping people without insurance access health care. Still, we cannot support it.

The Affordable Care Act (ACA) creates online health insurance marketplaces that will allow individuals, families, and small business employees to shop for health coverage. Marketplaces are a central component to the success of ACA state implementation. Plans sold on the marketplace will be available to most people, including people with HIV, regardless of their diagnosis or condition, ending decades of legal discrimination by insurance companies against people with HIV. People earning between about $16,000 and $46,000 will be able to receive subsidies to make premiums and out-of-pocket costs more affordable.

States have the option to operate the marketplace themselves, use a marketplace run by the federal government, or operate a state-federal partnership. In 2014, Illinois will employ the state-federal partnership option and use the federal marketplace as the backbone of its system; however, Illinois will directly operate outreach, enrollment, and other programs. (See the Kaiser Family Foundation’s “State Decisions on Health Insurance Exchanges and the Medicaid Expansion” for more information.)

The primary reason AFC opposes HB 3227 is that the Illinois General Assembly and its insurance-industry allies would have heavy control over the marketplace. Here are three examples of why this creates an unhealthy system of oversight: 1) the General Assembly would annually approve the budget for the exchange, even though its operating funds are held outside the state treasury; 2) the General Assembly would control even small details, such as the executive director’s salary; and 3) language in the bill limits the exchange’s future ability to impose standards that are more rigorous than the minimums established by the federal government.

The insurance industry has tremendous influence in Springfield. Advocates often joke that consumer-friendly insurance reform bills go to the House and Senate Insurance Committees to die. Moreover, the insurance industry makes significant campaign donations to sitting members of the General Assembly, as detailed in this 2011 State Journal Register article.

Giving significant control of the exchange to the General Assembly is akin to letting the fox design, build, stock, and guard the henhouse. If us chickens are to have a meaningful choice of affordable insurance plans that provide high-quality health care, the exchange needs more independence from the General Assembly and by extension, the insurance industry.

We favor an independent marketplace board of directors that includes strong consumer and small business members, not insurance industry representatives. A board with these standards and statewide representation will be vested in making the best decisions for Illinois health insurance consumers.

HB 3227 passed the Senate Insurance Committee May 9 by a vote of eight to five. Tellingly, the Illinois Governor’s Office position was “neutral,” meaning they neither supported nor opposed the bill. The bill awaits a vote in the full Senate, and then must proceed to the House. It’s too soon to predict if the measure will advance in the House by the end of the session on May 31.

Meanwhile, the marketplace, run by the state-federal government, will begin enrolling Illinoisans beginning Oct. 1, 2013, for coverage starting Jan. 1, 2014.

If HB 3227 does become law, AFC will work to influence regulations to favor consumers, and of course, we will advocate in future General Assembly sessions to improve the law for people with HIV, as well as other vulnerable populations.

John Peller is vice president of policy at AIDS Foundation of Chicago.