When the District launched its federally mandated health insurance exchange last fall, officials went to great lengths to woo professional insurance brokers — launching a special broker web portal, establishing a “concierge” hotline just for brokers and holding broker-only training classes.
Despite those efforts, many brokers have yet to be paid for the policies they’ve sold through the exchange, known as D.C. Health Link — generating frustration among professionals who say their patience in navigating the changes wrought by the Affordable Care Act has not been rewarded.
“I’ve been very supportive, I put a lot of work into it, and I’ve gotten nothing,” said Steve Nearman, a Virginia-based broker who says he has helped nearly 100 city residents find and buy insurance through the exchange and is owed thousands of dollars in commissions.
The unpaid brokers represent an additional set of hiccups for D.C. Health Link, one of the many state exchanges established pursuant to the federal health-care overhaul. Under city law, with few exceptions, individuals and small businesses are required to buy their health coverage through the exchange, which is meant to foster transparency and competition.
The District’s glitches have paled in comparison to those faced in Maryland and by the federal exchange, which is used in 36 states, including Virginia. But many District consumers have encountered problems using their hometown exchange. The Washington Post recently reported that some consumers have encountered significant delays in securing coverage because of apparent technology faults.
Mila Kofman, D.C. Health Link’s executive director, acknowledged that broker commissions have been an issue for months but said the exchange is committed to fixing the situation soon.
“It’s a really big problem,” she said. “People should be paid for what they do.”
Insurance consumers are not required to use brokers, also known as agents or producers, to buy policies through the exchange. But many small businesses and individuals, particularly families with complex coverage needs, use them to sort through the dozens of plans offered.
The payment issue, Kofman said, appears to be rooted in whether broker information is included in an electronic enrollment form passed from the exchange to the carrier and used to write the customer’s policy.
Some of those transmissions, Kofman said, did not include complete broker information — particularly applications that may have been partially filled out by a consumer directly instead of by a broker.
Using his personal records, Nearman last month compiled a spreadsheet listing his clients and their policy details in hopes of getting his commissions. “It still wasn’t enough,” he said; the exchange wanted him to get signed paper forms from his clients designating him as their broker.
Rob Poli is president and chief operating officer of the Rockville-based Insurance Marketing Center, a “general agent” that serves as a middleman between brokers such as Nearman and the carriers — CareFirst BlueCross BlueShield, Aetna, UnitedHealthcare and Kaiser Permanente — that sell policies through the exchange.
He said of the more than 100 brokers he represents, most had not been paid as of late June for the policies they’ve written through the D.C. exchange, many of which started in January. “Maryland, with all its problems, the brokers have still gotten paid,” Poli said.
D.C. Health Link does not record how many of those applying for insurance use a broker, but Kofman estimated that about one-quarter of households shopping for individual plans do, while about half of small businesses do. More than 12,300 are currently covered under individual plans sold through the exchange, and an additional 13,700 are covered through group plans.
A fix rolled out in February, Kofman said, was not as effective as planned, and in recent weeks, a team was assembled to scour exchange applications to find broker information that was not forwarded to carriers. That information has been gathered, she said, and brokers can expect payments as soon as this month.
But Poli said Friday that not all brokers will be made whole. Some have not been able to compile lists of their clients to match against the exchange data, like Nearman did, and for the rest, the information retrieved from the exchange’s system was not complete.
For those cases — about 20 percent of the unpaid accounts, in Poli’s estimation — brokers will have to get signed forms from their clients to get paid — an “embarrassing” prospect, Poli said: “It leaves some doubt in the client’s mind. Do you know how to do your job?”
For exchange officials, the irony is that D.C. Health Link went above and beyond to accommodate brokers in a system that some advocates hoped would help cut out middlemen.
Janet Trautwein, chief executive of the National Association of Health Underwriters, a trade association for insurance agents and brokers, said the District was an outlier among the exchanges.
“I have not seen anything anywhere that approached how broker-friendly D.C. is,” she said. “I’m not saying people don’t get frustrated with it — they do — but I can’t say it’s because D.C. doesn’t want to work with brokers.”
Problems transmitting broker information from exchanges to carriers has “happened in all the exchanges,” Troutwein said. “Sometimes it drops off and we can’t figure out why that occurs.”