January 07, 2015
The open enrollment period for the Federal health care program or Obamacare is only weeks away and will present numerous challenges for the health insurance lead ecosystem and the entire lead generation industry as a whole. While this open enrollment is technically the second ‘open enrollment’ period, it will be more massive and impactful than the first since there is greater awareness, the penalties for failing to sign-up for health insurance are much greater, and many of the exemptions or exceptions will have expired. As a result, the lead industry must watch closely what happens and plan to position itself to either take advantage of the open enrollment or work towards minimizing the impact.
Uncertainty about Premiums
For those consumers that are already on ObamaCare or have health care through their employer, they may be reluctant to make large ticket purchases until they know what their premiums and subsidies will be. This uncertainty is due to two reasons. One is that early indications have predicted that premiums may increase due to a large amount of unenrolled young adults. On top of the increases in overall costs, the second reason is that the minimum coverage required by businesses will be at a higher level of coverage than what they have provided in the past. Meaning employees may need to pick up the slack and pay more for their health insurance.
This uncertainty will impact not only the health insurance industry but all lead generation activities online as consumers will want to better understand their financial situation before making purchase decisions on cars, houses, insurance or any of the other ‘big ticket’ items. The uneasiness makes it even more vital that lead companies, especially health insurance lead companies, focus on quality and their use of services that provide lead warm transfers, so that they will be better able to connect with customers and help their customers resolve these challenges.
Uncertainty about Continued Coverage Opportunity
There is much uncertainty about whether businesses that provide health coverage in firms with less than 50 employees will continue. There is a good likelihood that businesses with under 50 employees will be reducing or completely eliminating the coverage they provide. The government’s mandated insurance levels may force business owners to re-evaluate whether they continue providing health care to their employees and at what level of benefit. Businesses might find their only option is to push the additional costs to their employees or decide to end coverage altogether.
Online companies will have to target both the employers and employees of these firms to offer better business rates and superior rates for employees that will be paying directly. These health insurance leads will be especially valuable as they could lead to getting business from the entire firm. Lead companies need to be aware that these health care decisions may delay other purchase decisions and in turn could impact 4th quarter sales.
Catastrophic Coverage Eliminated Opportunity
Many of the individuals who are on catastrophic plans, who are over 40, will have these plans eliminated. These individuals are used to paying a smaller monthly fee with very high deductibles. These are usually healthy individuals that also have savings or readily available access to credit. Lead companies will want to consider targeting these high value healthcare prospects in unique ways as they are extremely valuable to insurance companies.
The changes in minimum coverage will mean that health insurance companies will place greater emphasis than ever on securing high value policyholders to balance out their portfolio. Pre-existing conditions are no longer an allowable reason for turning down policyholders and as such they will place greater value on health care leads with data that indicates the person has a history of being healthy.
Government Regulation of Healthcare Advertising and Marketing Programs
With the government ‘takeover’ of health insurance, it is extremely likely that they will seek to be more involved in the way health insurance is marketed and sold in the United States. Insurance companies, lead companies, insurance agents and brokers and other related services must be clear and concise in their advertising, free of deceptive claims or offers and contain full disclosures. Quality in the health insurance leads space is now more critical than ever. Information about individuals needs, medical conditions and finances are all at play.
There is already a significant amount of regulation both at the Federal and at the State level of health insurance. It is critical that companies focus on the quality of the leads they are generating and handling them in a professional manner. Lead companies and insurance agents should consider using third party warm transfer services and other lead validation services to separate the good and bad leads that will inevitably be created in the fall with the potential uncertainty and confusion in the marketplace.
Lead companies and lead users should also seek to ‘self’ regulate the industry so that it will be less likely that the government will police it and levy additional regulations and restrictions on the online industry as it relates to health care insurance. There will be unscrupulous companies who will seek to take advantage of peoples suspicion and uncertainty. These companies should be reported and pressured by the industry as a whole to discontinue inappropriate tactics that damage everyone.
Health Care Insurance is more than an Annual Event
The health care law allows people to sign up for health insurance throughout the year under certain circumstances. Enrollment due to life changing events such as a death, marriage, birth of child, adoption, divorce, loss of job, aging out of eligibility on ones parents policy and other allowable circumstances. It is important for lead companies and people involved in selling health insurance that they fully understand the open enrollment exceptions and pre-qualify these leads through both the use of a completed data form and an insurance lead warm transfer service or other lead validation process.
It is easy for people to forget that these exceptions exist and to focus on the mass open enrollment period, however these exceptions represent millions of subscribers every year and can have a dramatic impact on both lead companies and insurance companies long term success.
The health insurance lead ecosystem will need to be proactive to survive the ongoing and ever changing healthcare environment. In many ways, they are at the mercy of the State and Federal governments and the policies that they decide to employ. Waiting and seeing what happens is not a strategy that will allow health insurance leads companies to survive and thrive. Consider the changing environment now and take steps to focus on quality, root out deceptive practices, emphasize disclosure and openness and you will be well on your way to surviving Obamacare.
Agent Ethan Kosmin Generated over $200,000 in premiums during first year in business thanks to Contact Concierge.
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