Archive for October 30th, 2010

VOTE CONSERVATIVE ON TUESDAY! LIBERALS TO VOTE ON WEDNESDAY

Saturday, October 30th, 2010

Due to higher than expected voter turnout, election officials have decided to allow only Conservatives to vote on Tuesday – Liberals to vote on Wednesday. Please pass this on to all your liberal friends.

Health Insurance Agents Condemned to Poverty

Saturday, October 30th, 2010

If you are a Health Insurance Agent, you might want to read this story:

Once upon a time, there was a great business called health insurance where an agent could get a license to sell this fabulous product and make a great living. But then the government decided to make drastic changes to this fine business and the rules and regulations became almost unbearable. As time went by, the government decided the health insurance business needed to be changed completely and to be run under the direction of the government themselves.

Well, it’s not just a story because the new health care reform bill has passed and we know major changes in the health market are coming. The most serious of those changes will directly affect how those of us are who sell individual health are paid commissions. The days of $600 to $800 advance commission you earn per sale are all but over.

Some companies have decided to limit advances to $300 per sale for a period of time, others will suspend ALL advances for a period of three months and when re-instituted, (if at all) will be limited to $150. What that really means, is that if you were writing 4 applications per week and earning $2,000, you will now have to write 13 applications per week to earn the same amount and common sense tells us that it’s impossible for that to happen.

This is an excerpt from an article written by a Health Insurance News writer:

“In my opinion (which is based on the General Accounting Office numbers) individual health insurance will eventually end, at least in terms of agents, just like it has in Massachusetts, where everyone buys insurance from the exchange. So again, individual health insurance will still be available, but only in health insurance exchanges where each state is responsible for their own exchange and which companies offer plans through the exchange.

Most Americans, probably don’t realize this, but in New York for example if you shop individual plans right now, the cost for an 18 year old male is the same as a 64 year old with diabetes and any other condition you can think of. And this premium is currently about $1000 per month for both the 18 and 65 year old, to get only average benefits.

Under this new law, the only people buying health insurance will be people who have insurance now and everyone who has been declined. (though many of them will elect instead to pay the $695 penalty, I know I probably would) The rest will head towards Medicaid and to their employer where premiums will be incredibly high, and already are.

The other nail in the proverbial coffin for health insurance brokers is the 80% rule, which simply states that 80% of premium must go to health care costs. This will eliminate most of the room to pay brokers even a reasonable commission after factoring in administrative costs.

Sadly for us this law takes effect as soon as 2011, which will in effect either put us out of business right away or dramatically hurt our bottom line. What is strange is that the health insurance exchange doesn’t become law until much later, which means that most health insurance brokers will be forced out due to this 80% rule in the very near term, and some have already started.

Finally and most importantly, young people and most of the uninsured right now for that matter, will not buy health insurance because the law only penalizes them $695 which is not even significant when compared to what premiums are and what they will become under this law.

Folks, these are facts not guesses. This marketplace as we know it, is over.”

John Holms – Ocean Equity Payment Solutions LLC

Editor’s Note: This article pertains to health insurance agents who sell individual health policies. Group health insurance producers will not be affected as quickly, but many will slowly disappear over the next 24 months. An uptick of panhandlers at every intersection may become apparent.