Insurance Exchange Takes Advice from Small Business Owners

Using insurance agents to disseminate information and network at trade conferences is key to spreading word about the exchange, they said


July 12, 2013—Four small business owners encouraged the board of directors of the state’s developing health insurance exchange to use insurance agents and network with trade associations to educate small businesses about the exchange and its upcoming enrollment period beginning October 1.

The board of Cover Oregon—the exchange’s name—met yesterday, and hosted the business owners to learn more about what the exchange can do to make it easier for businesses to enroll in and use the exchange, an online marketplace where approximately one million uninsured individual Oregonians and small businesses will be able to compare and purchase health insurance by next January

All four expressed eagerness to be part of the exchange. But they also said that many small business owners and employees either did not know enough about the exchange or how to compare and choose among various health plans.

Both could be potential hazards for the exchange. Because individuals and businesses will select health plans offered by the exchange via the Internet, the website has to be clear, easy to navigate, user friendly, and allow people to compare health plans in a way that’s easy to comprehend.

And the number of people enrolled in the exchange is vital for its success and financial solvency. Currently, Cover Oregon is funded by federal grants scheduled to expire by the end of 2015. Cover Oregon expects to support itself with a 2.52 percent administrative fee, equating to approximately $16 for each person who purchases coverage. To break even, Cover Oregon must enroll between 100,000 and 125,000 people by the end of 2015.

Jim Houser, owner of Hawthorne Auto Clinic and a member of the exchange’s community advisory committee, told Cover Oregon’s board that he had attended multiple seminars about health insurance exchanges hosted by trade associations, and was surprised by the lack of information—or wrong information—those in the business industry had about the exchange.

“The people they’ve brought up are not up to date, or not being completely truthful,” Houser said. “There is a ton of misinformation.”

Mike Roach, owner of Paloma Clothing, agreed and said the insurance agents that Cover Oregon uses to sell its health plans can have a profound impact when it comes to spreading word about the exchange. “They don’t need to be cheerleaders, but they do need to be positive about,” he said.

Roach explained that many employees, including his, may not know how to compare particular benefits among health plans, and how to choose which health plan may be the best for their circumstances. Often, Roach said, employees “look to [employers] to provide them with guidance.”

Insurance agents help individuals and businesses pick a health insurance plan best fitting that person or business’ needs. They typically work for insurance companies and are paid a commission based upon how many plans they sell. There are approximately 13,000 licensed agents in the state.

Cover Oregon launched its training program for insurance agents last month, and the first all-day trainings started this week. Approximately 1,500 agents have signed up, and a total of 2,000 agents are expected to work with Cover Oregon in the coming months.

Roach expressed hope that the exchange will offer employees a wider variety of options. Right now, he offers one health plan to his eight employees, despite the fact that his younger employees may not need some of the benefits his older employees do. “The younger ones may opt for lower cost plans, and not care about the [insurance] company they are with,” he said.

In addition to using insurance agents as a way to spread word about the exchange, the business owners encouraged the board to begin communicating with trade organizations and business groups.

Some of the board members noted that some of those groups are already beginning to learn independently about the exchange.

“You’re starting to see it in specific industries,” said Aelea Christofferson, a board member and owner of Bend’s ATL Communications. But at the same time, she noted that Cover Oregon’s board doesn’t necessarily “know what the various trade organizations are.”

She asked if the business owners would be willing to help the board target specific people and organizations to contact, which they agreed, indicating increasing collaboration between Cover Oregon and business owners excited about the exchange.

Liz Baxter, the board’s chair and executive director of the Oregon Public Health Institute, asked the business owners about their thoughts on the exchange’s software interface—what people will see when they go to Cover Oregon’s website to sign up for health insurance.

The owners emphasized easy navigation, a website with few pages to click through, and information easily understood by people not familiar with health insurance. “Its main feature is going to be ease,” Houser said.

The advice that Christine Chin Ryan, president of the IT firm Synergy Consulting Inc., gave illustrated the high bar the exchange has to pass to succeed.

“Make sure it works very, very well,” Ryan said.

Image for this story by Sal Falko (CC BY-NC 2.0) via Flickr.

Amanda Waldroupe can be reached at [email protected].

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Oregon's exchange must not delegate education entirely to brokers and agents. Some will provide excellent education; but the comparative spreadsheets many use for plan options do not take into account important plan specifics that make a big difference for some potential insured people and their employers. A balanced education approach is critical, and the exchange has a role that cannot be delegated.

Brokers and agents have an essential role in this process. They can assist in navigating the nonsensical waters of health insurance.