YOUR GUIDE TO SUCCESS

How to sell ACA insurance

An Agents Guide to Selling Marketplace Insurance

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1.) Introduction

Whether you're a seasoned insurance agent or just starting out, this comprehensive guide is here to give you the knowledge you need to succeed in the under 65 health insurance market (ACA).

In this article, you’ll learn about the Affordable Care Act (ACA) and its impact on health insurance. We’ll explain why now is an excellent time to enter this market, highlighting increased commission opportunities and expanded subsidy eligibility.

We’ll guide you through the steps to get licensed to sell ACA plans, ensuring you meet both federal and state requirements. You’ll gain insights into navigating the ACA marketplace, understanding the differences between on-exchange and off-exchange plans, and recognizing key enrollment periods.

Additionally, we provide strategies to maximize client benefits, helping them understand subsidies, eligibility, and the “Precious Metal” tier system.

Finally, we’ll discuss integrating ACA plans into your existing portfolio, leveraging current client relationships for long-term business growth, and covering new regulatory requirements to ensure you stay compliant and maintain your professional integrity.

The Statistics

ACA by the Numbers

14.5 Million Enrollees in ACA Plans in 2023

As of 2023, over 14.5 million Americans are enrolled in ACA marketplace plans, reflecting a large and growing pool of potential clients for agents to assist in finding the right coverage.

50% of Marketplace Enrollees are Under 35

Half of all ACA marketplace enrollees are younger individuals under 35, presenting a significant opportunity for agents to connect with a younger audience that may be new to purchasing health insurance.

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4 out of 5 Enrollees Find Plans for $10 or Less

Thanks to expanded subsidies under the ACA, 80% of enrollees can now find plans for $10 or less per month. This makes it easier for agents to highlight cost-effective options, attracting budget-conscious clients.

2.) What is the Affordable Care Act (ACA)

Overview of ACA and Its Impact on Health Insurance

The Affordable Care Act (ACA), enacted in 2010, aimed to provide affordable health insurance to more Americans and reduce healthcare costs.

By establishing health insurance marketplaces and expanding Medicaid, the ACA has significantly increased the number of insured individuals.

It also introduced essential health benefits, ensuring comprehensive coverage for various medical services.

Changes Brought by the American Rescue Plan and Inflation Reduction Act

The American Rescue Plan (ARP) and the Inflation Reduction Act (IRA) have further enhanced the ACA. The ARP increased subsidies, making premiums more affordable, while the IRA extended these subsidies, ensuring continued financial assistance for low- and middle-income individuals and families.

These changes have improved accessibility and affordability of health insurance, benefiting millions of Americans. For more detailed information, you can refer to the source article.

Source Article

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3.) FFM Certification: Getting licensed to sell Health Insurance

To sell health insurance through the Federally Facilitated Marketplace (FFM), agents must complete a certification process.

The steps are straightforward and can be completed through the Centers for Medicare & Medicaid Services (CMS) portal or an approved vendor:

Find ACA Certification and Training information and links on our ACA Marketplace Registration and Training page.

Create an Account: New agents must create an account on the CMS Enterprise Portal. Returning agents can log into their existing accounts.

Complete Training: Agents must navigate to the FFM Training for Agents / Brokers / Assisters and complete the necessary training modules. Returning agents may take a shorter version with optional review modules.

Identity Verification: Confirm your identity through the CMS portal.

Complete Exams: After training, agents must pass exams to demonstrate their understanding of FFM requirements and procedures.

Sign Agreements: Agents must sign the CMS Privacy and Security Agreements.

Get Appointed: Once training is complete, agents should request appointments with ACA carriers.

State and Federal Specific Requirements

In addition to the federal FFM certification, agents may need to meet specific state requirements to sell health insurance. These requirements can vary significantly from state to state:

State Licensing: Each state has its own insurance licensing requirements, which typically involve pre-licensing education, passing a state exam, and completing continuing education courses.

State-Specific Training: Some states may require additional training specific to their regulations and marketplace operations.

Registration with State Exchanges: In states that operate their own health insurance exchanges, agents must register and comply with any additional certification or training requirements those exchanges impose.

Completing both federal and state requirements ensures that you are fully prepared to assist clients with navigating the ACA marketplace and offering compliant health insurance plans.

View How to get FFM Certified to Sell Health Insurance

4.) Is now a good time to enter the Under-65 market?

Overall, the current environment is highly favorable for agents looking to enter or expand their presence in the under-65 health insurance market. With higher commissions and more potential clients eligible for subsidies, now is an excellent time to capitalize on these opportunities and grow your business.

Increased Commission Opportunities

The under-65 health insurance market has seen a resurgence in commission opportunities for agents. A few years ago, the landscape was bleak with carriers cutting commissions, but recent changes have turned this around. Carriers are now offering competitive commissions for ACA plans, similar to Medicare Advantage and Medicare Supplement plans.

These commissions are paid per member, per month, which can significantly boost an agent's income. For instance, some carriers offer $19 initial and $16 renewal commissions per member, which can add up quickly when enrolling multiple family members.

Expansion of Subsidy Eligibility

The American Rescue Plan Act of 2021 and the Inflation Reduction Act have expanded subsidy eligibility, making ACA plans more affordable for a larger segment of the population.

These legislative changes have lowered the income cap for subsidy eligibility to 8.5% of household income, allowing more households to qualify for financial assistance. This expansion has led to a record-high enrollment in ACA plans, with more people able to afford coverage thanks to increased subsidies.

Additionally, these subsidies are now available to individuals who previously did not qualify, such as those with incomes above 400% of the federal poverty level. This broadening of eligibility criteria means that more people can benefit from reduced premiums, making ACA plans an attractive option for clients.

5.) Navigating the ACA Marketplace

Key Features of ACA Marketplace Plans

ACA marketplace plans offer comprehensive health coverage, including a set of essential health benefits mandated by the Affordable Care Act.

These benefits include emergency services, maternity and newborn care, mental health and substance use disorder services, prescription drugs, and preventive and wellness services.

The goal is to ensure that all plans available on the marketplace provide a baseline of essential coverage, protecting consumers from high out-of-pocket costs for fundamental healthcare needs.

Differences Between On-Exchange and Off-Exchange Plans

The primary difference between on-exchange and off-exchange plans is where they are purchased and their eligibility for subsidies.

On-exchange plans are purchased through federal or state-run marketplaces (like HealthCare.gov) and are eligible for government subsidies that can significantly lower premiums for individuals and families with incomes between 100% and 400% of the federal poverty level. These plans must meet strict ACA guidelines, ensuring they cover all essential health benefits.

Off-exchange plans, on the other hand, are purchased directly from insurance companies or through brokers outside the official marketplaces.

While these plans may offer more flexibility and a broader range of options, they do not qualify for subsidies, making them potentially more expensive for those who do not qualify for financial assistance. Off-exchange plans might also lack some of the standardized benefits guaranteed by on-exchange plans.

Key Enrollment Periods: Open Enrollment and Special Enrollment

The Open Enrollment Period (OEP) for ACA plans typically runs from November 1 to January 15 in most states. This is the main window during which individuals can sign up for new health insurance plans or make changes to their existing coverage.

Enrolling by December 15 ensures coverage starts on January 1, while enrolling after this date generally means coverage will begin on February 1.

Outside of the OEP, individuals can enroll or make changes to their plans only if they qualify for a Special Enrollment Period (SEP). SEPs are triggered by certain life events such as losing other health coverage, moving, getting married, having a baby, or experiencing a significant change in income.

These periods provide flexibility for those who need to adjust their health insurance coverage due to life changes.

View: ACA Open Enrollment - Key Dates & Tips for Agents

6.) Maximize Client Benefits

To maximize client benefits, it’s crucial for agents to help clients understand the subsidies available and their eligibility for these financial aids. Subsidies can significantly reduce the cost of premiums and out-of-pocket expenses, making health insurance more affordable.

Educational Sessions

Conduct webinars or in-person sessions to explain how subsidies work. Use real-life examples to illustrate how different income levels and family sizes affect subsidy amounts.

Eligibility Assessment

Offer one-on-one consultations to go through clients' financial situations and help them understand how they can benefit from subsidies. This personalized approach can make complex information more digestible.

Personalized Assistance

Resource Materials

Provide clients with brochures, infographics, and FAQs that break down the subsidy process. Visual aids can simplify the understanding of how subsidies lower premium costs.

Explaining the Metal Tier System (Bronze, Silver, Gold, Platinum)

The ACA marketplace categorizes health plans into four metal tiers: Bronze, Silver, Gold, and Platinum. Each tier represents a different level of cost-sharing between the insurance provider and the insured, helping clients choose plans that best fit their financial and health needs:

Platinum Plans

The highest premium plans, covering about 90% of healthcare expenses. These plans are best for individuals who require frequent medical care and prefer to minimize their out-of-pocket costs.

Gold Plans

These plans cover around 80% of healthcare expenses and have higher premiums but lower out-of-pocket costs. They are ideal for individuals who expect to use more healthcare services and prefer to pay more monthly for lower costs when care is needed.

Silver Plans

Cover about 70% of healthcare expenses and have moderate premiums and out-of-pocket costs. Silver plans are unique because they are the only tier eligible for CSR, which reduces out-of-pocket costs for individuals with lower incomes.

Bronze Plans

These plans have the lowest premiums but the highest out-of-pocket costs when care is needed. They cover approximately 60% of healthcare expenses, making them suitable for individuals who prefer lower monthly costs and are relatively healthy.

7.) Integrating ACA Plans into Your Portfolio

Expanding your product portfolio to include both under-65 and over-65 plans can drive long-term business growth by attracting a wider client base and increasing your market reach. Here’s how:

1.) Comprehensive Coverage Options:

By offering a range of products, including ACA plans, Medicare supplements, ancillary products, and possibly life and annuity products, you can meet the diverse needs of your clients. This makes your services more attractive to potential clients looking for a one-stop solution for their health insurance needs.

2.) Increased Referrals and Renewals:

Satisfied clients are more likely to refer friends and family to you. Additionally, offering a variety of plans increases the likelihood of renewals, providing a steady stream of income and strengthening client relationships.

3.) Market Diversification:

By serving both the under-65 and over-65 markets, you can diversify your business risk. The healthcare landscape is always evolving, and having a diverse product portfolio ensures you can adapt to changes and maintain business stability.

4.) Enhanced Experience and Reputation:

Expanding your offerings and staying knowledgeable about various health insurance products can enhance your reputation as a comprehensive and knowledgeable insurance provider. This can attract more clients and establish you as a trusted advisor in the insurance industry.

By leveraging existing relationships and diversifying your product portfolio, you can secure a stronger position in the competitive health insurance market.

8.) New Regulatory Requirements

One of the key regulatory requirements for selling ACA plans is the proper documentation of client authorization. This ensures that all transactions and communications are conducted with the client's explicit consent, protecting both the client and the agent. Here are the main steps:

Written Consent: Agents must obtain written consent from clients before discussing their personal health information or enrolling them in a health plan. This consent should be detailed, specifying the scope of authorization and the duration for which it is valid. (View the Summary of CMS Consent Rules and a Link to the CMS Agent Broker Consent Form.)
Electronic Signatures: With the rise of digital transactions, electronic signatures have become an accepted method of documenting consent. Ensure that the e-signature process complies with legal standards and is securely stored for future reference.
Record Keeping: Maintain thorough records of all client interactions, including signed consent forms, email communications, and notes from phone calls. This documentation should be easily accessible in case of audits or disputes.
Periodic Updates: Periodically update consent records to ensure they remain current. Clients should be asked to renew their consent regularly, especially if there are significant changes in their health plan or personal circumstances.

For further Compliance requirements please refer to the CMS website for any recent updates.

9.) Conclusion

Throughout this guide, we have explored the various aspects of selling ACA insurance and integrating it into your portfolio. The health insurance landscape is continually evolving, presenting numerous opportunities for agents to expand their business and better serve their clients.

By incorporating ACA plans and Over 65 Plans into your portfolio, you can:

Increase Revenue: Take advantage of higher commissions and a broader client base by offering both under-65 and over-65 plans, and become less dependent on any one market.
Enhance Client Relationships: Provide a comprehensive suite of solutions that cater to the entire family, from young adults to seniors, thereby strengthening client loyalty and satisfaction.
Stay Competitive: Adapt to market changes and remain relevant by offering a diverse range of health insurance products that meet the varying needs of your clients.

Exploring ACA sales opportunities not only benefits your business but also helps more individuals and families access affordable and comprehensive health coverage.

Embrace these opportunities to grow your business and make a positive impact on your clients' lives. By following these guidelines and strategies, you can position yourself as a knowledgeable and trusted advisor in the broad health insurance market, ready to meet the diverse needs of your clients and drive long-term success for your business.

10.) Compliance Tips for Agents

Staying compliant with regulatory requirements is crucial for insurance agents to avoid legal issues and maintain their professional standing. At PSM Brokerage our compliance department helps agents navigate regulatory requirements confidently and stay updated on the latest changes.