Fresh from meeting with members of Congress during the National Association of Health Underwriters’ Capitol Conference last week, Kelly Fristoe of Financial Partners says some legislative staffers told NAHU members: “You guys need to probably start looking for a new line of business.”
They recommended shifting from selling health insurance products to life insurance or other financial services. “That’s pretty scary. That can be really disheartening,” says Fristoe, of Wichita Falls, Texas.
Thinking about the changes enacted in Massachusetts as a possible model, Stacey Merritt of Lone Star Health Plans is concerned about what the state’s practice of outlawing commissions on individual health insurance policies could mean for national reform.
“The agent is still involved in the group side, in the employer plan side. But, those commissions are $10 per month, per employee,” he says. “That’s what the commission is. If we were to implement that same commission schedule in Texas, I would take a 60% pay cut.”
Even if commissions are more than $10, Merritt believes his business will suffer no matter what plan the government produces, as long as it’s competing with private carriers. “I think what you’ll see is that the carriers would follow suit and they would pay commissions to be whatever the government would pay,” he says. “And I think under those circumstances we’re going to take a financial beating.”
Amidst all the talks of a public plan option and mandates, Mark Fisher of Idaho’s Advanced Benefits Management isn’t too worried -- as long as employers are included in the planning process.
“I think as long as an employer is included in the mix they’ll need somebody like a broker to be involved in distributing information, making sense of all the changes that may happen,” he says.
Still, Fisher isn’t sitting idle. He sees the role of technology increasing as benefits move toward a menu of voluntary, employee-directed options. Currently a broker on the major medical side, Fisher is thinking about hiring a team of worksite specialists. “I see myself probably hiring some people that will be direct to that employee in terms of advocacy and full-blown enrollment services,” he says.
Merritt has a contingency plan in place as well. “I’m seriously thinking about forming another business that’s related, in employee benefits, to make up for the loss -- a third-party administration firm,” he says.
At NAHU’s conference, Fristoe heard a lot of talk about a public plan option. “If there’s a Medicare-for-all program, well, employers may say, ‘You know, we’re going to just dump our plan and let our employees use that program,’” he says. “Maybe as agents we’re going to find ourselves in a position where we’re out here selling supplements to supplement that Medicare-for-all program.”
For now, Fristoe is concentrating on making his benefit designs employee-centric. If they’re happy, they won’t be calling their legislators asking for change, he reasons. Even so, he says employees need to do some changing of their own. “As Americans, we’ve also got to change our mindset,” he says.
“If we’re going to smoke cigarettes, if we’re going to drink beer, if we’re going to eat unhealthy food … there’s consequences from that. We’ve got to be more careful about taking care of ourselves and we’ve got to get off of this mindset that we’re entitled to a cure of every ailment that’s out there.”
