Legislative Update – How did we do?

Updated June 14, 2010

In what will long be remembered as the most turbulent and threatening time in our industry’s history, exactly what value did NAHU/WAHU provide its members?  What accomplishments did we have during these very difficult times?

With the federal health care reform enacted, and the legislative session we experienced this year in Wisconsin, it leaves most in our industry with a somber view of the future.  However, in a recent edition of NAHU’s Washington Update, CEO Janet Trautwein listed the accomplishments we actually had during the reform debate and it reminded me of the accomplishments we had in Wisconsin.  More importantly, the end results of these federal and state accomplishments actually provide a more optimistic view of the future of the industry and the future of the Employee Benefit Specialist. 

To be clear, most believe and predict that the law we know today as the Patient Protection and Affordable Health Care Act (PPACA) will not be the exact same law by 2014.  If it did anything, the delayed effective date of most of the provisions within PPACA provided the American public an ability to understand the consequences of the law and the opportunity to demand changes.  Even as NAIC and HHS work through the guidance phase of the early provisions, most see the challenges and contradictions within the law and know changes need to take place in order to even implement those provisions.  In her article, Janet clearly and accurately reflected one of the most important points to be made about the federal reform –  “exchange structures and mechanics are not going to be dictated from Washington – they will be implemented and designed on a state level “  Why is this so important?  Because the decisions on how to implement the exchange haven’t yet been made.  WAHU can, and will, influence how our state designs its exchange structure and the role of the agent.  With the passing of PPACA, our lobbying effort didn’t come to an end, rather it is only the beginning of what we need to do as an Association on influencing how the law will actually work in Wisconsin and what changes we can make to PPACA in Washington.

Let’s take a look at our accomplishments and discuss the value of your membership:

Federal

• PPACA specifically includes health insurance agents and brokers as the marketing force for the purchase of private health insurance coverage both inside and outside the new exchanges.  (§1312(e) of the PPACA (P.L. 111-148)).
 
• HHS will establish procedures under which a state could permit insurance agents or brokers to enroll individuals and employers in an exchange plan and assist them in applying for premium and cost-sharing subsidies.  WAHU will obviously be working with the next Administration and Legislature on this provision.
 
• Government regulators will not set agent commissions and fees, as was initially proposed in the Senate legislation.  Agent and broker commissions and compensation will continue to be established in the marketplace with state oversight―through negotiations between agents/brokers, insurance carriers and those for whom they provide services, based on the particular services involved and the competitive environment. 
 
• Beginning in 2014 “qualified health plans” will have to meet certain requirements, including charging the same premium for a plan regardless if it was offered in or out of the exchange (including through an insurance agent or broker).
 
• Beyond the broad conceptual structure of the Exchanges, the specifics and mechanics of the Exchanges will be determined by each state.  This is a huge federal victory, and a major opportunity for us to help shape the implementation of the exchange in as least disruptive to the private marketplace as possible.

State

• Prior to the Presidential election and the discussion of federal reform, Wisconsin had already been engaged in a debate on Exchanges and Connectors.  The largest threat occurred at the intention of the Administration to include the Exchanges and Connectors into the State Budget, known as Badger Choice.  Thanks to the efforts of WAHU members, that attempt was defeated and we can now take a clean page approach to helping shape what the federal exchange requirements will look like in Wisconsin.
 
• The federal law anticipates that states will develop an insurance ombudsman program that will help sell insurance through the exchange.  Wisconsin attempted to pass a law regarding that very concept called Benefit Counselors.  WAHU was the only lobbying organization to actively oppose the legislation and the bill was defeated.
 
• PPACA requires exchanges to be operational by 2014.  Until then, it only requires a web portal to be established that provides general information about public and private sector health plans.  The Doyle Administration made it clear they wanted to go well beyond the web portal and implement nearly the full exchange before January of 2011.  Based on their concept of Badger Choice, it is possible it would have precluded a private market outside the exchange.  Knowing they needed legislative authority to implement such an exchange, the current Administration attempted to sneak in a provision in the last days of this legislative session that would have given the administration complete authority to create and implement health reform in any manner it deemed necessary.  Through the efforts of many organizations, that provision was defeated. 
 
• While we were successful in defeating the above provision, the Administration continued with their efforts to push forward on the development of an exchange prior to 2014.  We assume they would have attempted to do this through regulation, which could have been challenged.  WAHU was asked to have a member serve on an Advisory Council to help shape this exchange.  Fortunately, the Council was abandoned by the Administration as well as the idea to move forward with such implementation.  This means we will now be given the opportunity to help shape the exchange with a different Administration and a new Legislature.  
 
• While we were disappointed with the mandates that did pass, we were involved with other organizations to defeat other mandates.  We were successful in defeating the Assignment of Benefits bill, the Self Funded Municipality bill, Oral Contraceptive Mandate and a Smoking Cessation Mandate.  

While we are proud of the accomplishments we have had in this extremely difficult session, much work lies ahead to ensure the role of the agent.  We are working very hard to ensure that the next Legislature better understands our industry.  We have worked to recruit candidates to the Legislature who are not only educated about our industry, but experienced.  To date, we have four insurance agents (two of which are WAHU members) running for the Assembly.  In addition, we have had many meetings with other candidates educating them about our industry, including Gubernatorial and Congressional candidates. 

We have positioned ourselves to be able to work extremely close with key elected officials on the development and implementation of the federal reform, including the exchanges.  Even without major changes to PPACA, Janet Trautwein accurately highlighted the new demand for professional and licensed agents who can advise employers and employees on a host of new insurance and tax-compliance issues.  Through the education NAHU/WAHU provide, our membership will be well equipped to provide such advice.  The role of the benefit specialist is not only alive and well, but should be looked at optimistically.  NAHU/WAHU is, in fact, a strong and effective association because of dedicated members like you.