New Health Reforms will Dictate Company Profits

The new health reform law put in place this year will place profit restrictions on health insurance companies. In order to participate in the State exchanges and to have access to 30 million new potential customers, they have to place 85% of premiums into medical coverage. This leaves 15% for expenses and profits. Also this also includes agents commission. As most insurance company executives will tell you, 15% is not a lot of room to cover for profit, commission and business expense. So the prediction is that agent commissions will be cut from the health insurance premium process. All indications show this to be true, just look at the Federal Government's new website for the upcoming health exchanges and you see no link or reference for agents or brokers. This is quite disturbing because the general public all alone tackling a Federal health system without the advocacy of agents is going to be disaster for the public good. I know the younger , web savy generation will think they can do all their health transactions on thier own, but they have no clue what it is like to deal with insurance companies. Those of us who make our living negotiating and working with insurance carriers know that it take knowledge and expertise to navigate and know the general public will be eaten alive by them without us agents. We will see how it plays out. Until next time know your risks and be careful out there.  K

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