By Jenny Gold
Fri, Sep 19 2014
LONDON, KY. -- David Combs has been a health insurance broker in this small city in central Kentucky for more than 15 years. When the Affordable Care Act became law, he read it cover to cover. Then he “panicked” and sold his agency.
The mainstay of his business had been selling coverage to small companies. And here was the government, stepping in and offering to sell it online instead. Initially, Combs and his fellow brokers thought they would go the way of travel agents, no longer needed in a do-it-yourself online marketplace.
But he started to think about the law in a new way after he learned that brokers could still earn a commission for selling coverage through the exchange. Kentucky built its own health insurance exchange – called Kynect -- and to expand Medicaid.
“I knew there was going to be a massive change in our industry, and anytime there’s a massive change, there’s opportunity,” says Combs, who started a new agency in 2013.
Some of the states that were most successful in enrolling consumers on the exchanges embraced brokers. In California, 39 percent of people who signed up for a private exchange plan enrolled with a broker; in Kentucky the number reached 44 percent.
Combs’ key insight was that many of his small business clients could do better dropping their small group coverage and helping their workers sign up for individual insurance on the exchange. The law allows companies with fewer than 50 full-time workers not to offer insurance.
Win-Win-Win
Frisch’s Big Boy, a bustling franchise diner off the highway, is the kind of small business client for Combs. Until this year, their policy was only available to full-time workers, and it was expensive, costing the company and the workers each $150 a month. Few of those eligible at Frisch’s actually bought policies. And on top of that, they were facing an 86 percent rate increase in 2014.
“It didn’t make sense for [Frisch’s] to continue to offer health insurance,” explains Combs. “It was actually a detriment to their employees.”
Because most of the restaurant’s employees are low-income, they actually qualified for free or low-cost coverage on Kynect. Switching everybody over to the exchange was win-win-win: cheaper for the restaurant, cheaper for the employees and more people got coverage, including some part-time workers.
“I thought to some degree it was too good to be true, what people were paying,” says Frisch’s part-owner Herman Hatfield. “But it worked out to where a lot of people got better care for less money.”
Combs earns a commission of $20 per month for each person he enrolls, including spouses and children. That commission is paid by the insurer and is already built into premiums. He was able to enroll everyone at Frisch’s in just two days.
source : Insurance Brokers Key To Kentucky's Obamacare Success
