By Janet Trautwein
Officials recently released 244 pages’ worth of regulations governing the
health-insurance exchanges established by the federal health reform law.
The rules envision a big role for “navigators” — entities or people
expected to help consumers evaluate their health insurance options in the
exchanges. Some groups intend for navigators to replace the folks who currently
help consumers with their insurance needs — licensed, professional health insurance
That would be a disaster. Although it will take many different voices to let people
who are uninsured today know about the health insurance options available in
2014, expanding the role of navigators from promoting program availability to
enrolling and advising people about specific plans is a consumer hazard. These
navigators will lack not only the expertise, training, and licensing that
agents possess but also sufficiently strong incentives to serve in an advisory
So who will these navigators be?
That’s not yet apparent — and will vary from state to state.
The law specifically lists agents and brokers as groups that may be navigators. But the law’s financial
requirements would force most agents and brokers to disrupt their business models
and could prevent them from serving current clients who might be ineligible to
purchase coverage through the exchanges. So it’s doubtful that many will participate
in the navigator program. They may instead try to work with the exchanges in
more traditional ways.
The proposed exchange rules also specify that at least some of the navigators must be
“consumer-focused” or “community-based.” In other words, they’ll need to demonstrate
an existing relationship to consumers.
Observers believe that trade, industry, and professional organizations; unions; chambers
of commerce; and small-business development centers could be among the groups
that serve as navigators. That makes sense. Their relationships will be
important in educating the public about new insurance opportunities in 2014.
Many are likely to have expertise with outreach to specific populations. But it’s safe
to assume that most will not be qualified to perform the work of agents and
brokers, who have been linking consumers to appropriate health insurance
policies for decades. Agents and brokers must already comply with state
licensing and continuing education requirements in order to advise consumers
about health insurance options. This important consumer protection is expected to
How would navigators be paid? Although states must have navigator programs, no federal
funds can be used for their payments, which are described as grants. It’s
unclear whether states must come up with this grant funding, how much these
grants would be, or how they would work.
With some 42 states and the District of Columbia facing budget shortfalls in 2012,
most states won’t have the money to support the sort of robust navigator
program the drafters of the law envisioned.
And what exactly will navigators do? The law says they will focus on public education,
outreach to special populations, and facilitating health-plan enrollment. But
the navigator program’s goals do not include providing plan-year-to-plan-year
assistance to consumers regarding the functionality of their health coverage.
By contrast, that’s an integral part of private health insurance agents’ jobs
and business models.
Agents and brokers aim to keep their clients for life and have financial incentives as
private business owners to furnish them with ongoing service. Agents hold
seminars to educate employees, fight to make sure claims are paid, and help their
clients find the right doctors and healthcare providers. The Congressional
Budget Office has reported that many insurance agents even function as virtual
human resources departments for small businesses.
It’s no wonder that those who have worked with agents have been satisfied. A 2007 IBM survey
found that 75 percent of those who employed agents held favorable views of
them. More than half cited “personalized experience” as what they
liked most about their insurance broker.
Every day, agents go above and beyond the call of duty. Their livelihood depends on it.
Consider the case of Idaho resident Anne Marie G., who publicly lauded the efforts of
her agent Brooks Mathern to handle “indecipherable” paperwork and
claims in the wake of the birth of her child.
Or take Maryland broker Marcia Friedman, who through diligent research found a way to get
additional coverage for a 10-year-old autistic girl who had exhausted her
family’s mental health coverage.
These are the sorts of problems that agents and brokers have solved for years — and
that navigators will be poorly equipped to deal with.
Millions of consumers depend on insurance agents to help them secure high-quality
coverage for their families — and to advocate on their behalf even after they
pay their premiums. Navigators may try to imitate agents, but they’ll never be
able to duplicate them.
Janet Trautwein is CEO of the
National Association of Health Underwriters.