This post was originally posted in its entirety on Progress Notes the Doctors for America Blog. Virginia Organizing has been engaged in a letter writting campaign against H.R. 1206 and also have a Consumer Representative, Tim Jost, representing Virginia Organizing at the NAIC meeting in Austin. If you would like to take action and send a letter opposing the Brokers Bailout, please send Brian Johns an email by clicking here.

By Dr. Evan Saulino

It’s one of those things that make you shake your head and wonder if the folks in Vermont are on to something.

H.R. 1206 – dubbed the “Brokers Bailout Act” by some consumer protection groups – was introduced by Representative Mike Roberts (R-MI) and referred to the House Committee on Energy and Commerce.

This bill would allow insurance companies to exclude payments to insurance brokers or agents from administrative overhead costs –the “medical-loss ratio” set by the Affordable Care Act mandating 80-85% of your insurance premium be spent on actual medical care.

Agents are claiming broker fees facilitate coverage  – and therefore medical care. The argument would seem to go that broker fees are a key step on the way to obtaining medical care, and therefore should not be considered an administrative cost.  

Several consumer advocacy organizations have launched a letter-writing campaign to oppose the legislation.

Not ones to wait-and-see, the health insurance agents employed a double pincer move, lobbying at the National Association of Insurance Commissioners (NAIC) meeting in Austin this week.   They were advocating to require that their services be used by any American who wants to buy health insurance through Health Insurance Exchanges, and for the “Broker Bailout” in the H.R. 1206 legislation (mentioned above).

Now, I don’t want to disparage any type of work…insurance brokers have been hit hard like the rest of us.  They can help people wade through the confusing myriad of insurance choices, in the small business market particularly. (Which again reminds me of the simplicity of the Green Mountain state’s proposed solution…)  But although brokers have “rebranded” themselves as “Producers” in some states, I’m not exactly sure what they produce.

If enacted, the insurance brokers’ proposals will funnel billions of federal tax dollars towards padding agents’ incomes and will fund administrative overhead spending – money not spent on direct medical care.

It’s really, really unlikely that paying insurance agents with our insurance premium and tax dollars is going to cure a single case of cancer, prevent a single heart attack, treat a single infection, or result in better access, affordability, or effectiveness of medical care for any Americans…

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