When the Patient Protection and Affordable Care Act made its debut in 2010, the United States health insurance industry experienced an immediate hit. Chaos ensued as thousands of agents and brokers lost their jobs from the law’s attempt to regulate internal spending, and thus many representatives have been less than supportive of health reform.
Though fear of job loss and industry collapse is present, and some have even called this time “the end of medical underwriting, ” the new healthcare law will not impact the need for underwriters. While laws are changing drastically in regards to nondiscrimination in a matter of months, the application process will not be streamlined by any means because of it.
Health insurance underwriting may currently be associated with declining applicants for coverage, as well as issuing exclusion periods and elimination riders, but it will remain an equally important position once those factors are outlawed. Although pre-existing conditions and gender will no longer play a role in premium increases and plan acceptance, a lengthy set of regulations remains for health plan applications.
In 2014, insurance companies will be opening their doors to the ill and female without discrimination, and insurance marketplaces will open online, doing the same. Underwriters will be needed to regulate and enroll the anticipated millions of people applying for new health plans through exchanges, as well as revised health plans through major carriers.
Therefore, if you were under the impression that every health insurance profession was soon to become obsolete because of federal law, here is a notable exception.
The Role of Medical Underwriters With New Laws
Those who have earned a living as medical underwriters will not be compromised for work; their responsibilities will simply adjust. Especially if an underwriter specializes in a certain area of health insurance, they will be even better utilized during this time of transition.
Even the Bureau of Labor Statistics acknowledges the potential for growth, hinting at the federal government’s need for this line of work.
Presently, most state laws allow insurance companies to create underwriting guidelines which make it difficult for certain people to get insured, as we know from the key points of the PPACA. As the laws change, the underwriter, serving as a nexus between the insurer (or exchange) and the agent (or website), will be extremely important.
Removing the Insurer’s Stigma Through Guaranteed Issue
Underwriting in 2014 will be kinder to Americans in need of coverage, which may slightly lift the negative connotation of insurance companies. Because they are still asking people to pay for what should be a free service, the stigma won’t be removed entirely, but at least it will lessen the blow from protesters.
Compared to before, the position of underwriting will consist of accepting every applicant, rather than practicing the art of high-risk member elimination.
Instead, the focus will be on age and tobacco use-related rate adjustments, despite every plan being guaranteed issue. Additionally, every sector of the industry will differ. Individual and small group coverage cannot impose any waiting periods or exclusions, yet large group plans will still use a waiting period while enrollment is pending. Employer-sponsored plans cannot exceed 90 days during a waiting period under the ACA, in order to ensure the employee is covered.
As state and federal governments work hurriedly to form fifty new health insurance entities, many underwriting gurus will be sought out. Though the process may be different, those experienced with underwriting software will be a great asset to the government, and will likely secure a continual position therein.
Underwriters have to be flexible, as software changes continually, and with the exchanges being entirely electronic, these experts will most likely be in high demand.