As commissions have been cut in half since the beginning of Covered California, more agents are stepping away from enrolling individuals and families into the exchange. A contributing factor to health insurance agents reconsidering their participation with Covered California is the mandate that they must enroll people into Medi-Cal with no compensation for their time or effort.
What Is The Cost Of Free Agent Medi-Cal Enrollments?
Initially the value proposition of enrolling consumers into either a private health plan with a monthly subsidy through Covered California or into Medi-Cal -where the agent is not compensated – was that the commissions for the increased private health plan enrollments would cover the expense of the Medi-Cal applications. This was partially helped in the first year where agents were paid $58 per household enrollment into Medi-Cal. But that funding ran out in 2015.
Agents are supposed to facilitate the enrollment of any consumer who seeks their assistance through the Covered California application into either a private health insurance plan or Medi-Cal. There are plenty of good reasons to spend 30 to 45 minutes enrolling people into Medi-Cal for no compensation.
- It’s the right thing to do because the process can be complicated.
- Agents are helping neighbors get health insurance to stay healthy and productive.
- Many children are automatically eligible for Medi-Cal while the adult family members qualify for private health insurance.
- Some people have Medi-Cal income levels today, but when earnings increase, the agent will earn a commission when the person is Covered California eligible.
- Helping one person might lead to a satisfied consumer who refers a friend whose income is high enough for private health insurance.
- Medi-Cal eligible individuals may need other insurance that the agent represents such as renters or automobile insurance.
However, enrolling individuals and family’s into Medi-Cal is not without its costs to the agent. I recently attempted to help an individual with a Medi-Cal enrollment in the middle of the 2018 Open Enrollment period. I spent two and half hours on the phone with the gentleman over three days answering all of his questions to the best of my ability about his income and eligibility. At the last step of the process before I submit the application, he refuses to give me hisnsocial security number over the phone. I can’t complete the application without the social security number.
If agents have a duty to facilitate enrollments into Medi-Cal, do those seeking free enrollment have a duty not yo waste an agent’s time?
As I mentioned earlier, the value proposition was that the commissions for health insurance enrollments because of the ACA would cover the costs of the non-compensated Medi-Cal enrollments. In 2014, an agent could enroll 10 individuals and perhaps 2 of them were Medi-Cal. With an average commission level of $20 per member per month, that would be 8 x $20 divided 10 to yield a net enrollment commission of $16 per person per month. In 2018 the commissions have dropped to around $10 pmpm, so the new reality under the scenario of 8 private plans and 2 Medi-Cal will yield average revenue of $8 per person per month.
Does Covered California Understand Time Requirement?
What Covered California doesn’t understand is that the low commission coupled with “no questions asked” Medi-Cal enrollment creates a revenue model that doesn’t work. You can’t employ a full-time licensed, certified, and trained Covered California agent to not only enroll consumers but also service the clients during the year. There is not enough money in the commission structure to make it work.
Then when Covered California asks agents to handle time consuming Medi-Cal enrollments, many agents are pulling back or completely walking away from Covered California. Management at Covered California has to understand the time it takes per enrollment because they time all the calls into their service center and their outcome. But unlike the service center representatives, when I take a call for a Medi-Cal enrollment (that CC doesn’t have to answer), I am not paid by the hour. In fact, I am not paid at all.
Covered California won’t tolerate agents who won’t abide by the agent contract about facilitating Medi-Cal enrollment. A contract is a contract, but gray areas exist. I have been prevented from quickly enrolling people in Medi-Cal because the federal information hub doesn’t recognize the person and can’t offer questions to verify the identity. How much time am I supposed to spend to verify the identity of someone for whom I am not being compensated?
Covered California Executive Director Peter Lee stated at a board meeting that an agent’s duty to assist consumers ends once the application has been submitted. Unfortunately, we have county Medi-Cal offices telling newly eligible people to upload their residency, citizenship, and income verification documents into their Covered California account. This generates another call to the enrolling agent for additional assistance with uploading files for the county to review.
Then there are the people who are misrepresenting their situation in order to get no cost Medi-Cal. More than once, through series of questions, it has become abundantly clear that the person I am talking is not being completely honest. Do I deny assistance and run the risk of being booted out of Covered California for not helping enroll a Medi-Cal individual? Do I enter the information, electronically sign the application, and then run the risk of losing my insurance license for fraud?
I don’t mind enrolling people into Medi-Cal. I’m a one-person operation and I enjoy chatting with people. But I have to draw the line with people who insist on me answering a million questions and then failing to give me the appropriate information to complete their Covered California Medi-Cal eligibility application. I also will not knowingly participate in any misrepresentation or fraud so a person can either be enrolled in Medi-Cal or be determined eligible for the tax credits through Covered California.
But unless Covered California takes steps to clarify the agent’s duty to assist with Medi-Cal enrollments and subsequent document verification, we will continue to see a reduction of agent actively enrolling consumers in Covered California. The continuing erosion of the commission structures makes it all but necessary for many agents to turn away all Covered California consumers because the time necessary for mandated Medi-Cal enrollments creates a revenue stream too low to justify continued investment.