Thursday, July 19, 2007

Stupid Carrier Tricks Numbers 236, 237, 238 . . .

From time to time we showcase carriers who do stupid things such as here and here (just to list a few). Seems we have been holding back and can't take it much longer.

So here are some new ones you may know.

Stupid carrier trick #236. Blue Cross of Georgia decides to roll out a new product. Actually, it isn't new but rather imported from their parent company in California. Seems Tonik has been a hot seller in California so now it is time to introduce young Georgian's to it.

On Monday 11/20/2006 an email goes out to all brokers announcing the new product and inviting brokers to the kick off & training session.

So what's the problem?

Monday, 11/20/2006 is 3 days before Thanksgiving.

The meeting is on Tuesday 11/21/2006.

Next comes Coventry with their new individual product. They have been active in the group market for some time (operating under various names) and decided to introduce a new individual major med product to Georgia. This plan is suppose to compete handily with the much entrenched Blue Cross plans. The new Coventry plans are almost a carbon copy of the Blue plans but with more bells & whistles and a lower price. They feature quick turn around in underwriting, fast issue . . . everything you would want.

The product is approved for sale for April 15th effective dates.

The kick off meeting is never officially announced to the brokers but by way of the grapevine I find out the kick off meeting is to be held on 4/19/2007 . . . four days after the product could officially be offered.

Despite a less than auspicious start the product has been well received. In fact, too well.

They have so many applications they cannot get the policies out the door until weeks after the effective date. Letters are sent out informing a client they are approved for coverage yet when those clients call customer service it seems the enrollment department has no record of the underwriting approval issued 3 weeks earlier.

Of course since enrollment has no record of the individual, no premiums have been drafted.


Next comes Humana. (Might as well spread it around. No need to just limit it to one carrier.)

They roll out new products in Colorado and are well received. A few months later they are introduced to AZ, IL, MI, LA, OH & TX.

So how is the announcement handled?

With a write up in a business newspaper.

And the brokers?

Not a word . . .

In case you are wondering, most carriers get 85 - 90% of their new business from brokers.

Not direct to consumer advertising.

Not from home office captive agents.

From independent brokers.

Now comes one of my favorite carriers.

No, seriously.

Last year about 60% of the business I wrote went with United HealthCare (AKA Golden Rule).

They are a great company with very good customer service, competitive products and a strong network. Their forte' is the HDHP (high deductible health plan) coupled with a seamless HSA (health savings account).

UHC owns Exante Bank. When a client buys the health insurance from UHC and opts to let Exante handle the HSA they can also let UHC draft directly from the HSA to pay providers.

The way this works is neat.

You see your doc, give them your card, and when you leave you do not pay. The doc files the claim with UHC on your behalf. About 2 weeks later the claim is processed and adjudicated by UHC and the lower, negotiated rate structure is applied. UHC then drafts your HSA and pays the provider for you.


This system works so well that I asked UHC if they would be willing to do the same for their other high deductible plans that are not HSA compliant. What could be more simple? The carrier already has the ability to perform a service to their client, allowing them to access providers without making a payment at time of service.

Granted, the HSA is a tax qualified plan but you can also have a non-qualified HSA. All the same benefits EXCEPT the tax favored transactions.

UHC has the system in place to draft directly from Exante Bank accounts.

UHC owns Exante Bank.

Simple request, huh?

The response is . . . "UHC will not be introducing new products with this capability".

What new product?

Same product you have now. The only change is performing a CUSTOMER SERVICE by drafting from an account OWNED BY UHC, funded by the policyholder and paying the provider directly.

No dice.

This stupid carrier trick tops my list.

At least for now . . .
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