Agents and brokers who want to help their clients enroll in coverage through one of the coming federal health insurance exchanges will be able to do so once they register with regulators and will get paid according to what the market will bear.
On the other hand, state-based exchanges, or “marketplaces” as the government is now calling them, will have the power to set their own compensation standards, including deciding whether they or issuers pay broker commissions.
The role of brokers in the exchanges has been subject to much dispute. In April, the administration drew brokers’ ire when it released rules for exchange navigators, essentially neutral parties who will help consumers shop for health insurance in the new exchanges. Many brokers were angered by the new rules, primarily because navigators won’t need to be licensed. They also won't be paid by carriers. HHS has said that exchanges will also need “in-person assisters” and possibly other types of registered intermediaries. All of these additional bodies, brokers say, will make it much more difficult for them to make a living.
Given the sensitivity surrounding the issue, CCIIO seemed to take extra care to acknowledge how critical brokers are to the benefits world.
“State-based marketplaces (SBMs) may establish parameters for compensating agents and brokers, by direct compensation from the marketplace, or by having issuers pay commissions,” CCIIO said in the document.
At the moment, 33 states are expected to have federally facility marketplaces or state partnership marketplaces, while 17 states and the District of Columbia have received conditional approval from HHS to operate their own state-based marketplaces. The marketplaces, being created under the PPACA, will open for enrollment Oct. 1. Moderate or low-income people must apply through the marketplaces to receive tax credit subsidies or enroll in Medicaid, and small businesses must apply for tax credits through the marketplaces.
CCIIO produced a Q&A with additional detail to clarify the role brokers in the exchanges. Here’s an excerpt of the question addressing compensation:
1. Can a state-based marketplace establish a commission schedule or pay commissions? How will federally-facilitated marketplaces, including state partnership marketplaces, address compensation?