The individual insurance market is seeing some hard-hitting changes. Premiums in many markets have increased more than expected, deductibles and out-of-pocket costs continue to go up, and now some carriers are beginning to drop their popular PPO plans.
Dropping of the PPO plans is a new concern and consumers seem to be continually required to pay more and more for less and less coverage. You may be asking yourself, how do sell health insurance if my clients can’t see their preferred health care providers? Many of the newer plans being offered, both on and off the Marketplace, have more restrictive network HMO plans with no non-emergency out-of-network options.
The answer, it’s not easy, but it can be done. People tend to get pretty attached to their doctors, and many also have a hospital of choice, so they will be more reluctant to buy a plan that doesn’t include those preferred providers. This may seem like a no-win situation for you, and some brokers may be considering giving up on selling individual health insurance. Before you start having similar ideas, we thought we’d share some of our thoughts with you about how we view the reality of selling these smaller network HMO plans.
Many brokers make the assumption that their clients won’t change their doctors in order to save a few bucks, but that’s not necessarily true. We feel consumers are willing to make changes if it means they have a lower their monthly premium. As a broker, all you need to do is show them the math and they may decide that their doctor isn’t worth the extra cost.
For instance, if a client has a preferred cardiologist who participates in a more expensive PPO plan but does not participate in a less costly HMO plan, it makes sense for you to point out how much extra your client may be paying for the access to see that specific provider.
Here’s an example of how the math might look:
If the premium is $150 more per month for the broader network PPO plan which includes the preferred cardiologist that adds up to $1,800 per year.
If the client sees the cardiologist twice a year, the extra premium puts those visits at $900 a visit, and that doesn’t include their portion of the plans cost sharing requirements
Seeing it that way, your client might reconsider changing to a HMO plan and changing doctors to save on their health care costs.
There are plenty of people out there who rarely see a doctor, either because they’re young, they’re healthy, or have chosen to go without insurance for the past couple years, and are avoiding the cost. In these cases, they may not be attached to a particular provider and may be willing to participate in a smaller network plan in order to get the coverage that fits their needs and budgets.
The assumption many brokers make is that their clients will have to change one or more doctors when they join an HMO. But maybe they won’t; HMO plans typically have a smaller network than PPO plans, but they still have a network of doctors and often times we are surprised to find that the preferred providers participate in these smaller networks.
As carriers continue to change their provider network access, doctors may also be willing to partner with you, as representative of their clients, to make sure they’re participating in the networks that offer their clients the best pricing. That said, as you’re mapping out your business plans for 2016 and beyond, think about setting some time aside to visit a few physicians in your area.
As you advise your clients, honesty is the best policy. To offset rising premiums, insurance companies have to increase out-of-pocket costs and reduce the provider network options. While you’ll do your best to find them the best plan for their money and consider their current provider availability, remind them they may benefit by making some tough choices between their preferred providers and their pocketbooks.
While Healthcare.gov and some of the state exchanges are improving the purchase experience, buying insurance is still not a simple do-it-yourself process. People need guidance now more than ever, so you continue to be value added resources in the insurance market. Not everyone will buy, but just give the best advice you can and you should make plenty of sales.