Hello CAHU members and welcome to
my first blog as your 2014-2015 President.
As an introduction to those who do not know me well, I have an insurance
agency in Oakland, have been in the business of health insurance for 26 years,
and have been involved in the Health Underwriters for 10 years. For the past few years I have been heavily
involved in CAHU’s legislative program.
As I sit to write my first
President’s blog, my thoughts turn to the guy who has been doing this for the
past year – Sam Smith. I marvel at Sam’s
professionalism as we went through the last year – probably the hardest year
for agents in our line of business, ever.
Sam dealt with the thousands of calls and notes from frustrated agents
and brokers over the past year, he navigated the tough political waters of
Covered California, the Department of Insurance, and the California
Legislature. And I am thankful that he
was there for CAHU and all of us this past year to deal with all of the Selfish,
I know!
In fact, there are a number of
unsung hero’s of CAHU that I want to bring to the attention of our
membership. Our legislative advocates –
Mike Belote and Juli Broyles – have been working on our behalf tirelessly for
the past four years bringing CAHU to a new level of respect and functionality
in Sacramento. There is not a committee
meeting or Covered California session that our advocates are not there
representing Health Insurance Agents in a professional manner, driving home our
vision.
More CAHU heroes: our Past Presidents – especially those who
have served since ACA was voted into existence – Dan Webb, Linda Rose Koehler,
and Chuck Rosen – along with Sam Smith – have been instrumental in positioning agents
and CAHU for continued success under the new ACA regime. It has been a difficult task but they set a successful
pathway for agents going forward. For example, agents are paid commissions for
placing business in the Exchanges--which was not necessarily a given fact four
years ago. We have an agent contract
that respects vesting. We have had major
legislative and policy leaders at the state and federal level give strong public
acknowledgment and support that agents continue to be the key piece to
the efficient, cost-effective distribution of insurance products. So CAHU members have a lot to be thankful for
as we move forward.
That being said, going forward the
CAHU Board has new issues to prepare for.
Specifically, we are in the process of gearing up to fight what may well
be the most corrosive initiative for health care since single-payer. I am talking about California’s November
ballot measure -- Proposition 45 Approval of Healthcare Insurance Rate Changes
(aka Rate Regulation) -- which essentially gives total control to the insurance
commissioner for regulation of rates, benefit plans, and spending control of
the insurance companies that operate in the state, including those who file
under the Department of Managed Health Care.
The devastating impact of Prop 45
could not be more severe for our clients.
Already, insurance companies are operating under the MLR standard –
meaning that profits are already capped and excess must be rebated back to
consumers. Prop 45’s real impact will be
to reduce services to our clients and consumers through fewer providers willing
to be in networks because their rates of reimbursement can be reduced, place earned
commission payments to agents at risk of political manipulation, and force changes
to benefit plan structures to whatever the sitting insurance commissioner or an
outside intervenor–– desires at the moment.
Like many laws in California, the
main beneficiary, should voters pass Prop 45, are the “intervenors” who most
likely are trial lawyers – who will be suing (i.e., “intervening”) to in rate
filings – supposedly to reduce rates. However,
the “consumer group” that supports the initiative is the exact same one that
has been paid over 80 percent of all “intervenor” payments—literally millions of
dollars from intervener suits against insurance companies on the P&C side under
Prop 103.
Over the next few months, CAHU
will be asking our members this year to step up and fight this. It is true Prop 45 will not lead to all insurance
companies left in California if the initiative does pass -- but I can guarantee
you that there will be far fewer health insurance companies doing business in
California if it does.
From a national perspective,
CAHU’s battle against Proposition 45 has been enthusiastically embraced from
the National Chapter. NAHU has agreed to
provide matching funds to our independent expenditure PAC. While CAHU must provide the other half of the
funding – I believe it we will make our fundraising goals with the generosity
of the CAHU members who understand that Proposition 45 is a killer to our
industry and to our customers.
Also, California members that
attended the NAHU annual convention, learned about recent actions in
Washington, D,C., met up with old friends and made many new ones -- a good time
in all respects.
CAHU once again had the largest
delegation, and brought home a number of awards, including: Most New Members
for Largest State Chapter; Web Site; and Landmark! Sam Smith also received a much deserved
Presidential Citation. Also, Linda Rose
Koehler, a former California President, has been elected Region VII Vice
President. Congratulations to Linda
Rose!
As I sign off, let me thank those
who supported me during my years in the association. I also want to let you all know that I will
do my best to represent our members this year the best way that I know
how.
I firmly believe that CAHU and NAHU are the
best way for health insurance agents in California and across the country to
impact our business in a positive and significant way. As with most things, the more effort and time
you put in, the more you are sure to get out of that effort. That is why I hope you will consider
participating with CAHU a little more this year than last – I absolutely know
it will be worth it. Agents
Are the Answer.
Here’s to a great year!
Patrick Burns
comments@cahu.org