California's health exchange is leaning on insurance agents to enroll thousands of people in Obamacare coverage. Trouble is, some agents haven't been paid for months.
In some cases, agents are owed thousands of dollars in commissions for getting folks signed up earlier this year. And they said they still face long waits on the phone to get simple issues resolved for customers.
Their experiences could sap much of the enthusiasm among Covered California's most effective sales force. The exchange's 12,000 certified insurance agents brought in 40% of individual enrollment in the first year, or more than 500,000 people.
"Everything would be forgiven if Covered California's service level got up to industry standards," said Sam Smith, an insurance broker in Encino and immediate past president of the California Assn. of Health Underwriters, an industry group.
"If that doesn't happen, the damage could be permanent," he cautioned.
Peter Lee, executive director of Covered California, has apologized for the exchange's poor service and highlighted the progress being made on several fronts.
In a written report last week to the exchange board, Lee said the state still owes commissions to agents for enrolling small employers going back to June. It hopes to make those payments next month.
About $2 million is owed to 2,200 agents for enrolling people in Medi-Cal, the state's Medicaid program for low-income residents, but the state doesn't expect some of those payments to be made until January. The state isn't responsible for commissions when agents enroll individuals in private health plans because insurers handle that directly.
To help reduce wait times, the state has nearly doubled the number of call-center workers since April and established a dedicated line for agents.
Lee made a point of saluting the work of insurance agents as he toured the state recently to promote the launch of open enrollment, which began Nov. 15 and ends Feb. 15. He often shared the stage with agents at events from Northern California to Los Angeles.
"We think people will need more in-person help this time, and we have folks ready to serve," Lee said. "We know we weren't perfect the first year."
California needs all the help it can muster. More than 1.2 million people need to renew their policies, and the exchange wants to add 500,000 people by mid-February.
The state's $95-million marketing and outreach campaign encourages people to find a local agent or enrollment counselor to assist them. The exchange's revamped website tries to make it easier to search for nearby help by ZIP Code.
Consumers often need help estimating household income, which determines how much of a federal premium subsidy is available. There are also questions about what doctors and hospitals are covered by various health plans and the differences in out-of-pocket costs for bronze, silver and other levels of coverage.
More than 12,600 agents have become certified to sell policies through Covered California. An additional 6,000 certified enrollment counselors at clinics, nonprofit groups and other organizations are available in the community.
Agents signed up more than four times as many people as enrollment counselors did during the first open enrollment, from October 2013 to April 2014.
But some agents say the late payments and interminable waits on the phone have soured them on Covered California.
Wayne Asa Carpenter, an independent insurance broker in Pasadena, said he's still owed about $4,000 in commissions for enrolling an L.A. firm in the exchange's small-business marketplace in February.
Last week, when he called the exchange's phone line for agents, the automated operator said there were 103 callers ahead of him. Other agents also reported being stuck on hold for more than an hour at times. Consumers often experience similar wait times.
In the meantime, Carpenter said, he gets repeated pitches from the exchange urging him to sign up more employers for 2015.
"I haven't even been paid for the business I did already," Carpenter said. "Why would I want to do more business with you?"
Exchange spokesman Dana Howard said the average wait time for agents was about 30 minutes this week and more staff are being added. "We expect service levels to improve," he said.
Kevin Knauss, an insurance agent in Granite Bay, said he's still owed about $1,000 in commissions for a Bay Area business he enrolled with Covered California.
But that was just part of the problem. He said it took seven months to get an employee's dependent taken off the account and to fix the billing.
"Right now I'm just so gun-shy to write new business with them," Knauss said. "We need healthcare reform, but no one is particularly excited about dealing with Covered California. It's the necessary middleman we have to hold hands with."
Before the exchange, agents were accustomed to working with health insurers directly to update account information and resolve technical glitches.
But for individual or small-business policyholders enrolled through Covered California, changes must be handled by the exchange. Covered California then passes that information along to the health plan.
Individuals and small employers can purchase coverage outside the exchange. But federal subsidies and employer tax credits are only available through the state marketplace.
Many agents say the exchange has become more responsive to complaints and improved its communication with agents.
Smith, the Encino agent, said he commends the state for hosting a weekly conference call on which problems can be raised and addressed more promptly. He also credits the exchange for hiring a former Kaiser Permanente executive as director of individual and small business sales.
"Some of these things are to be expected any time you have this kind of upheaval in the marketplace," Smith said. "We are willing to make this work, but we need Covered California's help."