Why is there opposition against insurers and health plans selling across state lines?

It’s easy to do plus it can improve quality and pricing while maintaining compliance.

From our last post, the idea of GI with a common sense approach to Pre-ex periods sparked some interesting emails. Newer brokers in the business for 5 years or so thought it was confusing. Experienced brokers in the business longer and certainly those prior to 1992 understand the logic and agreed with the idea for the most part.

In fact, many believe that if the Bush administration would have introduced GI with Limited Pre-ex at the same time that HSAs and HRAs were codified back in 2002 that we might never have heard of the Affordable Care Act. It wouldn’t have been needed!

Moving on, today let’s discuss the selling of health insurance across state lines. Many experienced insurance folks believe that this might be the toughest of all issues to address. It may sound easy to the non-insurance person but dealing with various state DOIs is never easy.

First obstacle many will say is that there is no proof that plans sold across state lines for example, from Iowa to California, will be any more competitive or appealing. But an even bigger obstacle is the political nature of multi-state DOIs “territorial-stay off my turf” attitudes that may feel obligated or find it opportunistic to interfere.

Some DOIs may argue that multi-state plans will not be consumer friendly or they will be wrought with trouble because of various issues such as specific state mandates and other regulatory rules.
To that attitude I say baloney.

Health plans can easily be sold across state lines in an internet connected shop-for-anything and buy-anything by smart phone world . Here’s why:

  • Brokers will still be the delivery system to insure quality and appeal
  • Individual states can still regulate brokers and carrier solvency
  • ERISA guidelines can be modified to overcome DOI objections
  • Plus ERISA (DOL) is quite capable of regulating compliance.
  • Just ask any TPA!
  • Plans would be built to serve the public not the political bureaucracy
  • It would all be GI so if a plan is not appealing it can be replaced
  • Eliminate wasteful mandates (last count there were over 1500)
  • Competition between insurers would increase driving premiums down
  • That’s just a short list and I know there are a few more details

The opposition may come from those determined to see a single-payer system. However, it is clear to see that the ACA is failing and did so mainly because it tried to takeover healthcare rather than just improve affordability and access to healthcare.

We need new ideas injected from people with real world experience like TPAs, brokers, consultants and smaller insurers. Make no mistake those opposed to fixing the ACA will object to selling plans across state lines and even some in favor of repeal may be opposed.

But if the goal is to deliver a real solution to our current high-price, low-quality, no-transparency healthcare system then we need to be guided by principles that deliver lower cost, better benefits and guarantee access.
We need to allow for the selling of health plans across state lines.

I am interested to hear your feedback on this idea because it’s complicated and controversial plus there are many details to work out. Let me know.

Next post will be either transparency or pricing ideas. Please stand by.
Remember, you have a new email at which to reach me.

Also remember, we are all in this together.

Mark Reynolds, RHU
mark@reynolds.wtf
559-250-2000

 

 

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2 Responses to “Why is there opposition against insurers and health plans selling across state lines?”

  1. Tom Christian Says:

    Hey Mark, great article. Maybe the next could address tort reform and removing any taxes on either premiums or expenses.

  2. Mark Reynolds, RHU Says:

    Thanks Tom, I have both on my list of topics to address. You can help me get the ideas out if you pass the blog on to associates, clients, and such. Happy New Year to you.

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