The Newly Proposed Bill Brokers Should Know About

Lower Health Care Costs Act, What Brokers Should Know

The Lower Health Care Costs Act was introduced on June 19, 2019 in an attempt to make health care less expensive by advocating for transparency. This bill even has a clause pertaining to brokers specifically. Since we are still in the early stages of the bill it is uncertain how revisions will be made, or if it will be passed, but remaining informed on potential changes will allow you to stay ahead of the curve. Let’s explore the aspects of this bill that pertain to you and understand this new point of view.

Section 308 of the Lower Health Care Costs Act focuses on “[1]Disclosure of direct and indirect compensation for brokers and consultants to employer-sponsored health plans and enrollees in plans on the individual market.” This would require brokers to disclose any direct or indirect compensation, between themselves and the plan carrier, prior to the client making the final decision and in the confirmation documents. The purpose of this clause is based on the notion that compensation for specific plans will lead to a conflict of interest which raises unnecessary costs for the clients. Of course, the intentions of this bill are good, but is the solution fitting?

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This bipartisan bill is an example that we can all agree on the price of health care being a problematic rising expense for many. [2]Studies have reported the trouble people have while trying to pay off medical bills resulting in them skimping on groceries, taking on extra work, or even postponing follow up appointments. The health care market is complex and will require multiple factors to change to make an impact, which is why this bill is inclusive in dispersing accountability to all parties relating to healthcare costs. While transparency may help the health costs epidemic, it would require healthcare as a whole to adjust as well. Even the larger parts of the bill discuss transparency between hospitals and health insurance carriers, emphasizing that the deeper issue lies somewhere other than the brokers. However, no one is certain on how the results will unfold, as there is no equation to account for how each entity in this bill will react. Yet the thought process behind this clause is intuitive: eliminate conflict of interests and bring down costs.

Now, in terms of broker transparency, there is uncertainty in whether disclosures will have an effect. In the end, your focus is on helping your clients and staying up to date on the latest news affecting your industry. Here at Trusted American Insurance Agency we are dedicated to making sure agents stay informed because we know you want the best for your clients. Subscribe to our blog to get more updates on this complex industry, and to strengthen your knowledge and resilience against change.


[1] Sec. 308. Lower Health Care Costs Act https://www.help.senate.gov/imo/media/doc/LHCC%20Act%20Discussion%20Draft%205_23_2019.pdf#page=111

[2] The Balance: Health Care Costs Facts https://www.thebalance.com/healthcare-costs-3306068