The preliminary numbers are in: At the end of the first special open
enrollment period 3 million Californians found health insurance through Covered
California and approximately 1.8 million more found coverage through the
private insurance marketplace. Without question, Certified Insurance
Agents have played a key role in the success of open enrollment in both the
state exchange and the private insurance marketplace. In this blog, CAHU takes
a look at the numbers reported to date.
State Exchange Enrollments
Covered California reported that of the 3 million health insurance policies obtained through the state exchange during open enrollment, 41 percent of all consumers self-enrolled for coverage through the Covered California website.
Certified Insurance Agents enrolled 39 percent of all consumers, while Covered California Certified Enrollment Counselors and Service Center Representatives each enrolled about 9 percent.
There are three points important for our members to bear in mind when considering the percentage of enrollments reported by Covered California:
State Exchange Enrollments
Covered California reported that of the 3 million health insurance policies obtained through the state exchange during open enrollment, 41 percent of all consumers self-enrolled for coverage through the Covered California website.
Certified Insurance Agents enrolled 39 percent of all consumers, while Covered California Certified Enrollment Counselors and Service Center Representatives each enrolled about 9 percent.
There are three points important for our members to bear in mind when considering the percentage of enrollments reported by Covered California:
- Enrollment percentages reported by Covered California are based on completed enrollment applications that have been submitted rather than “effectuated enrollments” (submitted, approved and paid for).
- The percentage of “enrollments” attributed to agents by Covered California does not take into account the percent of enrollments attributed to agents for the 1.8 million health policies purchased in the private market.
- Medi-Cal enrollments account for approximately 2 million of Covered California’s total 3 million enrollments and may well be the population that attributed to the high percentage of self–enrollment customers.
As most professionals in the health insurance industry know, “effectuated enrollments” constitute those approved enrollment applications whose monthly premiums are paid over at least two consecutive monthly payment cycles. Consider the following:
- Agents typically characterize “effectuated enrollments” as the true measure of an enrollment.
- Health insurance carriers independently confirm that 85% or roughly 150,000 of Covered California’s non-subsidized enrollment applications have converted to “effectuated enrollments”.
- Initial numbers show very clearly that those applications submitted with the assistance of Certified Insurance Agents have converted to "effectuated enrollments" at a higher rate than those of any other enrollment source.
- Payment data related to the 1 million partially subsidized enrollment applications submitted to Covered California is not yet available.
- If the usual trend of new enrollments converting to paid enrollments holds true, agents should be confident of being in the top tier of producers-- by a wide margin---over other enrollment avenues through Covered California.
Non- State Exchange Enrollments
So far, very little has been made public about Californians who purchased coverage in the private Exchange. None of the 1.8 million purchasers had a subsidy – and those 1.8 million non-subsidized enrollments bought in the open market outpaced the 173,000 non-subsidized enrollments through Covered California by a ratio of more than 10 to 1. It is very likely agents will prove to be the primary effectuated enrollment vehicle in the non-state exchange as well.
The Churn Rate
Licensed agents historically drive a high percentage of annual policy renewals. Our members have built their successful businesses on the “service after sale” to ensure long term client retention. Covered California's long term viability will hinge on how well they service their new customers -- particularly in view of the fact that their upcoming budget calls for reductions in service centers.
I believe that as more Californians understand that the professional advice of a Certified Insurance Agent is offered at no additional cost will offer future gains for the professional agent. Consequently, it is vital for CAHU members to continue to offer the high level of personalized service our clients can and do rely on.
It is as important as ever to be available and active even outside of open enrollment periods. Satisfied clients confirm what industry professionals already know, that the “Agents are the Answer”.
Until Next Week,
Sam