October 1st is Here and So Are Exchanges. Now What?

October 1st is here and so are exchanges. Now what?

The much-anticipated go-live date for federal and state exchanges has arrived. Today, we’ll get to see what exchanges look like across the United States, how individual shoppers and Small Business Health Insurance Options Program (SHOP) shoppers will view the public exchange experience. Small businesses won't be able to see exchanges until November 1st due to a recent delay, but they will be able to begin shopping via paper applications. Will day one of the Affordable Care Act’s implementation go off smoothly or will there be a few additional bumps along the way?

Either way, the time has arrived. I know for many of us in the insurance world – insurance brokers, carriers and employer groups alike – reaching October 1^st and the launch of exchanges felt like a long road. We’ve been talking about health care reform, reading about its impact on medical and dental plans, and preparing for this for a while.

Now that it’s here, we’re left with many questions about what’s next on the health care reform horizon…what now?

Let’s take a look at this from a few angles.

Health Care Reform: The Here and Now

SUPPORT: With the launch of federal, state and private exchanges, many employees and individuals are being moved from a hand-held, consultative, in-person open enrollment experience with the support of a broker or HR representative to a self-directed online enrollment. They’re used to having someone available to walk them through the plans and help them understand the benefits. Sure, there are navigators, but it’s important to note that this process is a little different from what they are familiar with. As a broker, you have the knowledge to educate your clients on and off exchanges. This is an opportune time to reach out and share your expertise.

COST: There’s also been some discussion on whether costs will rise or decrease. Today, we’ll see what the rates, plans and options look like for medical plans, dental plans, bundled plans and beyond.

CHOICE: Individuals who previously had limited options for insurance coverage, as well as employees who were offered one or perhaps two options, are now faced with a variety of benefits. They have the ability to find a plan that works best for their unique needs. Although with those options, they must also try to understand the various plans, and their nuances. And – for the first time –figure out how to pick the right one.

LEVEL PLAYING FIELD: Benefits are, for the most part, standardized with metal levels. Platinum, gold, silver and bronze will help indicate the plan richness to consumers. How will enrollees select benefits in this new level playing field?

In a national research study conducted by Stonegate Advisors, 81 percent of enrollees in beta test exchanges selected bronze or silver plans. Price – in those tests – was the driving force for decision making. Interestingly enough, network loyalty wasn’t a significant factor. Fifty percent of respondents were willing to take a smaller network for an additional 10-15 percent in savings.

Health Care Reform: The Future for Insurance Brokers and Consultants

Now that the employer mandate has been moved to 2014, how is your role as a benefits broker evolving?

Ultimately, employers and consumers want expert help in choosing medical, dental, life and other benefits. These are difficult decisions and consumer studies show that employers and individuals both recognize the value of a broker’s knowledge and expertise.  A recent study found that almost 60 percent of consumers who purchased insurance on their own returned to independent agents. The main reason? They wanted more value as well as a broker’s expertise. These consumers realized the value you offer as a broker such as:

• One point of contact to handle insurance selection, needs and questions
• Recommendations of an experienced insurance broker

There’s no doubt about it. The expertise and convenience you bring to the table for your clients is key in maintaining a loyal customer base.

Health Care Reform – The Future of Ancillary Benefits

Employer groups will continue to retain and attract top talent through the benefits they offer. Over 90 percent of large employers offer dental coverage, and that number continues to rise year after year according to the National Association of Dental Plans (NADP). Ancillary benefits will play a key role in their employee compensation package. Brokers can create a powerful proposal with dental benefits, which remains employees’ most desired benefit after medical coverage.

Ancillary benefits remain a highly demanded product for brokers’ clients and continue to be a viable sales tool to support their business.

Health Care Reform – The Shift into Business to Consumer Model

There’s some debate about whether this shift will actually occur. Regardless of what side you stand on, the reality is that employees are going to be making benefits decisions on exchanges. They will take the driver seat in selecting the right products for their needs, starting with the carrier down to the plan.

Benefit brokers and employers alike should consider offering more robust educational tools and support to assist enrollees with these decisions. Whether you’re a broker or an employer, the benefits of offering support leads to increased employee/client satisfaction and there’s certainly tangible value there.

Health care reform continues to change and evolve. You’re in uncharted waters. The best way to stay ahead is to equip yourself with knowledge to keep you ahead of the curve.