Notes from the broken healthcare system: Lavish bonuses for brokers increase your out-of-pocket cost
newsdepo.com
If the health insurance industry wants to stave off a massive reform of the nation's healthcare system that leaves them out in the cold, they're doing this all wrong. An in-depth investigation by ProPublica and NPR's «Shots» blog reveals the obsceNotes from the broken healthcare system: Lavish bonuses for brokers increase your out-of-pocket cost
If the health insurance industry wants to stave off a massive reform of the nation's healthcare system that leaves them out in the cold, they're doing this all wrong. An in-depth investigation by ProPublica and NPR's «Shots» blog reveals the obscene payouts insurance companies make to independent brokers for getting employers to sign up. Those massive payouts end up being passed on to those same employers, and the people who work for them, via higher coverage costs. When I say «obscene,» I mean really, truly excessive. Like Health Net of California’s providing bonuses of $150,000 for each employer group signed up. New York's EmblemHealth caps its per-employer group bonuses at $100,000, but offers unlimited bonuses and also gives top sellers «the chance of a lifetime» to bat against legendary New York Yankees pitcher Mariano Rivera. Cigna offers its top sellers five-day vacation stays at a luxury resort in the Bahamas. These brokers are supposed to be the representatives of employer groups, hired to help them navigate the complex system of health insurance and get them the best options for their employee coverage. The employers are the brokers' clients, but the insurance companies pay the brokers with commissions that are generally 3 to 6 percent of the total premium cost to the employers. ProPublica provides an example of a company with 100 employees paying premiums that add up to about $50,000 a year for the broker, payable as long as the employer is holding that plan. That fee is coming from the premiums paid by employers and their employees. When the premiums go up, so does the broker's commission. These massive bonuses are also being paid out of the employers’ (and the workers they're covering) salaries, albeit less directly. They're also creating a «classic conflict of interest» for the brokers who are supposed to be working for their clients in finding the best deal for them, says Eric Campbell, director of research at the University of Colorado Center for Bioethics and Humanities. Read more