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Keeping you up to date on changes in the health insurance industry.

Fright of the Navigator

by Parisi Insurance Agency on 02/27/13

As you may or may not already know, the face of health insurance as we know it is about to change drastically in the coming year. Starting January 1, 2014 the major component of President Barack Obama’s sweeping health care reform goes into practice, as individuals and small business will have unprecedented access to health insurance via what is known as the “Exchange”. The Exchange will be a state or federal run website where individuals will be able to select and choose health care plans for themselves and their families, and, in many cases, get a subsidy to defray the cost of this coverage.  Small businesses are also going to be able to have access to similar coverage through a site known as “The SHOP”.

Now, on the upside, this access to health coverage, as well as the low-income subsidies, (oh, and did I mention that starting in 2014, you will not be denied for any pre-existing conditions?  …Unless you count smoking as a pre-existing condition- seriously, time to quit, people!), will go a long way to ensure that almost all Americans will have proper health coverage, and be able to afford the medical services they will need! However, as most of us know, the realm of health insurance is a tricky one.  It’s a web of little details and fine print. Finding the right insurance coverage for you or your family is a balancing act between getting the things important to you covered while keeping your costs as low as possible. There are hundreds of options to choose from but only a very few that are right for a given individual. Given this free access to buy something so important without proper guidance on such a mass scale, this Exchange could very easily lead to disaster. Never fear though, there is a new breed of government agent to save the day!

As a part of this change, the state exchanges are required to establish what is known as a “Navigator” program- Basically, a paid public advisor to assist you in your options though the exchange. Sounds great, right? Not so fast…

The navigator program has some serious flaws, and is a potential danger to those newly seeking out their insurance options in the coming year.  For purposes of comparison, this “navigator” is basically an insurance “agent” with this new exchange, as opposed to actual insurance agents (broker) who already handle assisting people with their insurance needs. The proponents of the navigator program will cite impartiality as the benefit of the navigator over the broker. They would make the argument that the navigator, being paid by the government or independent grant, will not “steer” an individual toward specific plans due to the level of commission that they may get, in contrast to brokers who are paid commissions by the insurance carriers for their work.  This is potentially true. However, a good broker acts in the best interest of his client first and foremost, and is held accountable for this (more on that later). It’s just good business sense! If a broker were to continually steer his clients into inferior plans, thinking only of commission and not client need, he or she would not have clients for long. Not to say that this may not happen, but it’s the gross exception, not the rule.  But, that’s it! That is your one potential advantage of using a navigator over a broker once you are ready to shop for your health coverage.

Now let’s talk about the disadvantages, shall we?

The big one here is knowledge! Insurance brokers have to go through an upwards of 52 hours of class and pass a state exam, just to get a license. After that, we have to take continuing education classes every year to keep that license current. At this point, navigators are not required to be licensed! Furthermore, brokers also work closely with and train with the insurance carriers to stay current with the details of the plans they are offering.  Brokers also have the experience. For example, the licensed brokers at Parisi Insurance Agency have an average of 18 years of health insurance experience. Not only are the navigators not expected to be licensed, to date, no standards have been issued for what they are going to be required to know and if there is a testing, etc.! This program launches its Open Enrollment in October, is that really enough time to learn what they will need to know for such a responsibility? Furthermore, insurance brokers will have to take whatever class/certification the navigators take anyways, so the broker will know everything the navigator will know- the reverse, however, will not hold true.

Availability may also be an issue under this new navigator program, the general idea thus far is that grants from the government would most likely go to trade organizations, business associations, and other community based organizations. What if you do not work or live in a specific trade, business or community? How would you know to find them? Brokers, on the other hand, look in the phone book or internet under “health insurance”, you find a list of them, right in your neighborhood!

It’s important to note that the information provided above regarding the navigators is not final, and is subject to changes as we get closer to the launch of this open enrollment. However, again, is there enough time to launch this navigator program on a national scale and have it be even remotely useful to the consumer?

There will be a lot of very important choices to make in the coming year where your health care is concerned. Chances are you’ll need some guidance in these matters. You will be hearing a lot about these Navigators in the coming months, don’t believe the hype. Do yourself a favor and trust the experience that comes with an insurance agent!

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