Agents angry about unpaid ACA exchange plan commissions

Sales compensation payment problems could hurt efforts by HealthCare.gov to hold on to its distribution force.

Kevin Counihan, HealthCare.gov's chief executive officer, said Wednesday during a webinar with producers that agents and brokers facilitated about half of HealthCare.gov's sales.

The Centers for Medicare & Medicaid Services (CMS), an arm of the U.S. Department of Health and Human Services, set up HealthCare.gov to provide Affordable Care Act public exchange enrollment and administration services in states that are unwilling or unable to run their own exchange enrollment programs.

A CMS agent registration database shows HealthCare.gov, a family of Web-based health insurance supermarkets, has 84,840 agents registered for the 2016 plan year. That's down from 102,992 for the 2015 plan year, but it's up from 66,906 for the 2014 plan year.

Getting producers to return for the 2017 annual open enrollment period, which is set to start Nov. 1, may be difficult.

Some insurers slashed individual major medical commissions around 2010, when President Obama signed the bills that created the ACA exchange system into law. This year, many insurers have used sales commission cuts to try to limit sales of underpriced ACA exchange plans.

Some insurers appear to be on track to pull out of the exchange system entirely in 2017.

Meanwhile, producers say, getting issuers to pay commissions for past ACA exchange plan sales is often a nightmare.

Some state-based ACA exchanges, including Covered California, handle exchange plan commission payments. Managers of HealthCare.gov have tried to stay out of commission matters. HealthCare.gov says it will let agents put their National Producer Numbers on exchange users' applications, and send the applications including the NPNs to the insurers, but that the producers and insurers have to handle commission bills and disputes themselves.

Problems with National Producer Numbers

B. Ronnell Nolan, president of New Orleans-based Health Agents for America, an agent group, said in an email interview that HealthCare.gov seems to have a hard time getting the NPNs to stick with the exchange users' coverage applications.

"Everyone has had problems with being removed from the application," Nolan said.

She said she asked agents at a meeting in Tampa, Florida, Wednesday about the NPN loss problem, and half of the agents in the room raised their hands.

One HAFA member, who used a Web broker entity to get around HealthCare.gov glitch problems, told Nolan that her NPN got dropped from about 150 accounts. That could keep her from collecting the renewal commissions she was promised.

Counihan said during the producer webinar that HealthCare.gov managers have tried to improve systems in ways that will help attach NPNs to applications more effectively.

Meanwhile, big, publicly traded Web broker entities appear to be having problems of their own with the commission collection process.

One, Mountain View, California-based eHealth, the parent of eHealthInsurance.com, says that it has de-emphasized marketing of individual major medical plans because of all of the problems in the ACA exchange system. Given all of the losses in the individual major medical market, "we may see an overall reduction in our inventory of individual and family plans, and some deterioration and broker commission in this coming open enrollment period compared to the last," Scott Flanders, the company's chief executive officer, said in July during a conference call with securities analysts.

Flanders said eHealth has tried to cope with the individual major medical market problems by selling more Medicare plans. Even in the Medicare market, issuers are so slow to pay their commission bills that eHealth has had to increase the reserves it uses to adjust for commission payment delays, Flanders said.

Combat commission compression with non-insured benefits

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