With the amount of options available, finding a covered California insurance agent can be a tough process. To make matters worse, the health insurance industry is full of roadblocks that can make the process harder and less effective than it should be. Our team at Good and Associates Insurance Services lists some things that we want fixed in the industry below.
We believe that removing the agent commission out of the Medical Loss Ratio (MLR) would be a step forward for the industry. The Affordable Care Act (ACA) requires that 80% of insurance premiums be spent on direct medical care. However, the administrative expenses that make up the remaining 20% also include agent commissions.
Why Remove It?
The remaining 20% includes various expenses, everything from paper clips to insurance carrier salaries, which doesn’t leave much room for the insurance agent – the main delivery mechanism for the sale. This causes insurance carriers to reduce agent compensation, in turn pushing many health insurance agents out of the industry. Removing agent commissions from the calculation would benefit both agents and the industry as a whole.
The ACA requires insurance companies to follow a strict format when it comes to health insurance plans, meaning many carriers have the same benefit structure with only marginal differences. This structural rigidity drives up costs and, ironically, makes the ACA very unaffordable. If we bring back the ability of insurance carriers to design their own plans, we believe that these problems can be solved.
In order to provide the best covered California insurance agents possible, we believe that the changes above need to take place. If you’re looking for quality health insurance plans, give us a call at(800) 429-9900 or (909) 613-0056anytime and we’ll be happy to help you out.