October 20, 2011
[recipient address was inserted here]
Dear Representative Harris and Senator Kotowski,
As a health benefits professional, I am writing to you today to urge you
to support the creation of an Illinois based Health Benefit Exchange that
supports Illinois’ competitive insurance market and the important role of
insurance producers (agents and brokers) in helping individuals and small
businesses meet their health insurance needs. Legislation is under
consideration during the veto session to establish the basic foundation of
Illinois” health benefit exchange.
A health insurance exchange (HBE) is a new virtual health insurance
marketplace required by the federal health reform law, PPACA. Each state
must establish an exchange or the federal government will implement one
for the residents of Illinois. To avoid a federal one-size-fits-all
federal approach, we have established an agent-broker coalition in
cooperation with all of our National Association of Health Underwriters’
(NAHU) members and NAIFA Illinois and IIA of Illinois to develop
recommendations for a successful Illinois health insurance exchange.
We believe that any health insurance exchange (HBE) must include the
following:
1.Illinois’ HBE governance board needs to include individuals with a
variety of perspectives and those with in-depth knowledge of the health
insurance and benefits market – especially insurance producers. An
insurance producer is critical to this board’s strength in that brokers
work daily with consumers, businesses, employees, insurers, medical
providers and regulators. We believe our knowledge of the marketing, sales
and servicing of health insurance will be of great benefit to the HBE.
2.The structure and operations of the HBE must be simple, transparent and
cost-effective. We believe that a large bureaucracy similar to the
Massachusetts Connector (their health insurance exchange) is costly and
unnecessary – and the result with be higher health insurance costs.
3.Individuals and employers must have the option to utilize the services
of a licensed insurance producer. Therefore:
a.The HBE should have a certification program for producers
b.The HBE should have a producer locator prominently available on the HBE website
c.There must be a producer identified on the application.
4. The HBE should have no role in determining producer compensation.
Health plans will continue to contract with producers, verify licensing
compliance and compensate producers as they do today.
We need your support to guarantee that professionally trained and state
licensed health insurance producers (agents and brokers) will be included
in the sales and service of health insurance for small businesses and
individuals. Actively engaging licensed insurance producers will save the
state and taxpayers considerable money. If the Exchange does not
encourage broker participation, it will effectively replace thousands of
private sector employees with public employees ultimately paid for in the
form of higher health insurance premiums.
Finally, it is my understanding that if the Illinois General Assembly does
not act on creating a governance structure for the HBE this fall, the
Governor will do so through an Executive Order. Therefore, we urge members
of the General Assembly to pass legislation creating Illinois’ HBE
governance board and include our Agent/Broker Coalition’s recommendations
listed above.
Sincerely,
John Rippinger
