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Jim Lentini: Brokers can help with insurance exchanges

Business Commentary

Posted: November 29, 2010 9:49 p.m.
Updated: November 30, 2010 4:55 a.m.

With the recent change in Congress, the majority of Americans hope we will see changes to stabilize our health care coverage.

Since our health care represents one-sixth of our economy,  all Americans, both the insured and the brokers, will be watching to see how our coverage is affected, how changes apply and whether we will continue to get the services we expect.

This is especially of concern in California, as SB 900 recently passed and may be the forerunner of the first health care insurance exchange.

The exchange would be controlled by a government agency, and state residents could use it to apply for health care coverage.
The health reform legislation clearly states that state exchanges can use brokers. But, in all likelihood, exchanges will also be selling insurance coverage directly and using a still relatively undefined network of “navigators.”

The question brokers ask is “Why would clients use navigators to purchase exchange coverage when they could go straight to the exchange or to an unlicensed navigator?” The answer is the same as to why an employer would use a broker today when they could go directly to the carrier.

It’s because the broker can provide coverage information and offer unbiased recommendations the employer needs to make intelligent, well-informed decisions. The broker can assist with comparisons of the companies that best fit the needs and wants of a business and its employees.  A broker can provide unbiased service for mundane issues, as well as help a business with serious policy interpretation issues.

The government’s entry into the health industry has created more reporting, more paperwork, rules and regulation. Although the health care changes and new rules only began five months ago, costs have also escalated tremendously.

More than at any time in recent memory, health insurance brokers will be tested for their resiliency and their ability to adapt to marketplace changes, deliver what their clients want, and remain relevant to the needs of their individual clients, employers, and their employees.

Jim Lentini, CLU, ChFC, IAR is president of Lentini Insurance & Investments, Inc. He can be reached at (661) 254-7633. His column reflects his own views and not necessarily those of The Signal.


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