Blue Shield has redesigned their online enrollment website to exclude seniors turning 65 in 2016 from purchasing a health plan directly through their website. If an individual will be turning 65 years old within six months of the effective date of the plan they must apply with a paper application. The only online enrollment option is to use the Covered California enrollment website even if the individual doesn’t qualify for the ACA tax credits.
64 1/2 year olds can’t enroll online with Blue Shield
A health insurance agent first noticed the discriminatory paper application practice by Blue Shield when she tried to apply using her own Blue Shield quoting link. This health agent will be turning 65 in February and only needs an individual and family plan for the month of January. When she went to get an online quote with the expectation of enrolling in a plan directly with Blue Shield she was greeted a message of “Call to Apply”. All other people within Blue Shields most favored age range are offered Add to Cart option.
Seniors directed to Call To Apply
The agent was perplexed because she was being instructed to call herself and she had never been informed of this new Blue Shield policy of denying seniors the ability to apply directly online. Upon calling Blue Shield she was informed that if a senior turning 65 in 2016 wanted to enroll in a Blue Shield health plan online they would have to go through Covered California. The alternative was downloading Blue Shield;’s paper application, filing it out, and submitting it to them by fax, mail, or email. (I confirmed this when I spoke with a Blue Shield customer service representative on December 4, 2015). Unfortunately, she didn’t want to bother with all the nonsense of Covered California for a variety of reasons the least of which was she was only going to have the plan for one month.
Why aren’t 64 year olds worthy of Blue Shield online enrollment?
There may be several reasons why Blue Shield has decided seniors turning 65 in 2016 are second class citizens and not worthy of online enrollment (Blue Shield Online Enrollment Website as of December 6, 2015 was directing an applicant that would be 65 years old within six months of the beginning of 2016 Call To Apply). However, the practice of forcing an individual to fill out a paper application to enroll in a health plan when there is the simpler and quicker alternative of online enrollment for everyone else is at its core discriminatory.
Separate but equal is a form of discrimination
Anytime a company erects a barrier or challenge to purchasing a product or service with the intent to dissuade market activity by a class of people, it is a form of discrimination. The requirement of a paper application is in the same spirit of the literacy tests employed by southern states to reduce black Americans from registering to vote. Blue Shield is holding out the paper application as “separate but equal” similar to many Jim Crow laws of the 20th century. Blue Shield is telling seniors to enter through the back door and then they must ride in the back of the bus.
Blue Shield may lose Medicare business
From a business perspective, I can only surmise that Blue Shield has calculated that the reduction of seniors selecting their health plans because of the challenge posed by having to use a paper application for their individual and family plan enrollment will cost them less money in future claims expense. But the individual and family health plan division must not have talked to the Medicare unit. Most health insurance companies want seniors on the books so they can easily slide them over to the more lucrative Medicare Advantage, Part D Prescription Drug, and Medicare Supplement products. It is far less expensive to transfer an existing 64 year old into a government sponsored cash cow Medicare Advantage plan, than it is to go out and acquire that same individual with direct mail, print, or telephone solicitations.
Not everyone wants to hassle with Covered California
Blue Shield’s decision to push seniors to Covered California online enrollment is also an odd marketing practice from an outsider’s perspective. Blue Shield has to pay Covered California $13.95 for each member each month enrolled through Covered California. When a person uses the Covered California online application they are given multiple carriers to select from. A person might select a health plan that is $50 less per month instead of the Blue Shield they were considering. This is like Ford telling consumers to go to car lots where they can buy a Chevrolet instead.
Seniors must you the back door to apply
Perhaps Blue Shield is clueless as to how their actions to segregate 64 ½ year old individuals from enrolling online from the rest of the population are being perceived. They obviously have their reasons. But until Blue Shield explains how forcing these seniors to use the back door to enroll in a health plan is a benefit to these seniors, most people will assume they’re discriminating against this class of individuals for profit purposes.