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Idaho insurance agents leery of exchange benefits

On the eve of the Idaho exchange rollout, health care insurance agents are still waiting to be convinced it will benefit their businesses.

The concerns came even though the board that created the Internet marketplace for individual and small business coverage took pains to make sure they could still earn commissions.

The exchange is set to go live on Oct. 1, to begin enrolling people for coverage due to start Jan. 1. On Sept. 30, the board that oversees the exchange gave a vote of confidence to the security system set up to protect the personal and financial data of those who will use the online marketplace to shop and buy insurance policies.

Amy Dowd, exchange director, said the exchange is also expected to move forward despite the threat of a federal government shutdown. She told the board funding to operate the exchanges is mandatory.

Dowd also took steps to alleviate concerns expressed by Idaho’s insurance agents and brokers, saying the exchange opens the opportunity to gain a share of the roughly 200,000 people who could be eligible for the federally subsidized policies.

“There’s a whole new population of uninsured who need or would like expertise in understanding their options and getting advice,” Dowd said.

But Tom Shores, a Boise insurance agent who is on the 19-member board of the exchange, estimates he’ll have to pick up 3,000 new customers to offset commissions he said are already shrinking.

Commissions on his brokerage’s existing 4,000 health care policies have already been cut by 25 percent to about $9 per policy monthly as a result of provisions in President Obama’s overhaul aimed at limiting administrative costs in health insurance premiums.

Additionally, he believes roughly 1,000 of his existing customers might learn they’re eligible for Medicaid, the government insurance for low-income people, once they enter their financial data into the exchange system. As a result, Shores said, he must aggressively recruit new customers just to stay afloat.

“I either have to do that or retire and sell whatever I have left of the business to someone else,” he said. “And I’m not willing to do that.”

Early in the 2013 Legislature’s debate over the exchange, much of the discussion revolved around the role of “navigators,” ‘‘in-person assisters” or call-center employees who would be hired to assist prospective enrollees in understanding what for many may be a new experience dealing with co-payments, deductibles and premiums.

Sen. Dean Cameron, R-Rupert and an insurance agent, worried that agents and brokers would simply be cut out of the process, in particular if Idaho adopted a federally run exchange, as 34 states chose to do.

After becoming one of the few Republican-led states to adopt a state-run exchange, Idaho’s exchange board, with Shores leading the push, put strict limits on the kind of information such in-person assisters can provide, limiting it to technical advice, not selling actual policies.

For instance, Idaho Hospital Association director Steve Millard expects about 200 employees at his lobbying group’s 47 member hospitals who already work with uninsured patients on payment options to become in-person assisters, helping educate prospective enrollees about Idaho’s exchange. Once a conversation turns to actually buying a policy, however, Millard said that’s where the discussion will end.

“They would hand them off to a broker at a certain point,” Millard said.

Even so, there’s deep skepticism among brokers across Idaho they’ll see a boost to their businesses.

“The original objective was to eliminate us completely,” said Bob Ricketts, for whom health plans represent about 10 percent of his Boise brokerage’s business. Now, Ricketts said, “we’re being told there are all these uninsured out there that are coming to us. We may pick up a little more business, but whether you make any more money is another question.”

At the exchange website, there will be a list of agents and brokers authorized to sell policies via the exchange, and which carriers they represent. Currently, seven carriers will be offering 146 health and dental plans.

About The Associated Press