President Obama, The Worst Salesman in America

By Ross Schriftman, RHU, LUTCF, ACBC, MSAA

It is remarkable that someone who ran such a successful campaign to be elected President is such a poor salesman when it comes to promoting his policies.  Barrack Obama’s 2008 election campaign was brilliantly executed.  His ability to inspire support for his agenda is abysmal.

The reason is obvious. He really does not understand what sales is all about.  He uses the worst tactics; the ones that give all Americans who sell for a living a bad reputation.  Let me count the ways he fails as a salesman by using his health care “reform” law as an example.

First, he doesn’t understand the needs of the buying public and decides in advance what he wants to sell; not what people feel they need.  He believes myths and doesn’t bother to really understand the issue before he launches into his sales pitch.

He doesn’t understand his product so he makes up stuff along the way.  Therefore he contradicts himself and loses all credibility. He compounds the problem by changing the terms of the agreement and fudging on the details.  He keeps having to re-explain what he meant to the buyer (all of us) so he adds to the confusion.

He gives special deals away to some of his favorite clients and makes the rest of us pay the full price.  This is called the “waiver” programs.  This creates resentment and damages his reputation for honesty.

He blames others for the failure to get his message across.  With Obamacare he blames insurance companies, Republicans, “those who oppose change”, the Tea Party and entrenched “special interest” for not going along with his failed message and opposing his idea of reform.

Ultimately he insults the buyer for failing to understand all the great things they should be supporting and dismissing rather than understanding each objection people raise.  (“Let me be clear” is one of his favorite opening lines.) His tone and facial expressions show a lack of patience for those who don’t agree with his ideas.  The most successful sales people have learned the important art of listening; not talking.

Maybe all of this is why the President has such a negative view of health insurance agents.  He doesn’t understand how sales work and doesn’t appreciate the on going value of those who sell and service health insurance for their clients.  What a shame.  If he had utilized our knowledge and experiences in crafting sensible reforms we could have been his best sales force.  Instead half the state governments, most of the business community and large majorities of the American people oppose the law.  Pieces of the law are already unraveling and his Administration is constantly presenting contradictory and untrue testimony before Congress.  Common sense reform is needed.  A great opportunity has been delayed by the worst salesman in America.



The Future of Brokers

By Greg Scandlen

Now that the Medical Loss Ratio (MLR) standards are in effect, the role of producers is once again under scrutiny. Writing in Health Plan Week, Steve Davis reports on the recent NAHU conference in Washington, which included a presentation by former Pennsylvania Insurance Commissioner Joel Ario, who now directs HHS’s Office of Insurance Exchanges. Mr. Ario thinks there may be a role for brokers in the insurance exchanges as “navigators,” but:

Ario said the law envisions “baseline similarities” between navigators and insurance agents. However, he said agents sometimes don’t possess necessary “linguistic capacities” and “don’t necessarily serve all of the different populations as well as they could be served.” Those comments were met with boos.

In a follow-up post on the AISHealth Blog, Rick Biehl fleshes out the situation:

Certain features of health reform will invariably be detrimental to health plans, hospitals, provider groups and pharma companies. But for most of these bloated corporations the impact of reform is likely to resemble a pebble dropping into the middle of a lake. For agents and brokers – many of whom have been productive members of local communities for decades, if not generations – reform could mean the end of their livelihood and perhaps their profession. The lack of reason and fairness of this unintended consequence is palpable.

But Mr. Biehl thinks this is all just a horrible mistake:

While clearly not the intent of Congress, “insurance broker/agent” may be the only job title in America that, on a personal level, is facing such dire consequences under reform. Who else in health care business stands to suffer such enormous personal losses?

Sorry, Rick, but you are wrong on this. Getting rid of agents and brokers was EXACTLY the intent of Congress, and all other progressives of the past 100 years. When these people talk about “administrative waste” they mean broker commissions.

“Getting rid of the middleman” has been a core tenet of socialist policies forever. Salesmen especially are seen as leaches on society who add costs but no value, and the socialist economies suffer because of it. The old Soviet Union actually grew plenty of wheat on the farms, and it had plenty of hungry consumers in the cities. What it was missing were the middlemen who could arrange to transform the wheat into bread and transport it from the farm to the city.

Congressional progressives knew that by reducing loss ratios and creating exchanges, they would drive brokers out of business. They figured that consumer questions could best be answered by community organizers with the “necessary linguistic capacities” and experience in reaching out to “communities.” This was seen as a job for ACORN, not some independent businessmen.

All this has been obvious since before Obama got elected. It is shocking that the brokers still haven’t figured it out.

Want to Make a Difference?

By Greg Scandlen

Like you, I have been watching the events unfolding in Madison, Wisconsin with alarm. The thuggish tactics of the union supporters and the Democrat Senators are appalling. Never mind elections, who can yell the loudest?

That isn’t supposed to be how it works in this Republic. This isn’t Greece.  Here you are supposed to make your case to the voters. If you lose, come back in the next election and try again. That’s what the Republicans did with ObamaCare.

Now it is spreading to Ohio and Indiana, and if the unions win, it will become standard operating procedure across the country.

It all underscores how critical the states are to the future of this country. Much of this gets lost in the 24-hour news cycle that focuses much more on Washington and can’t even find Frankfurt, Kentucky on a map – at least not until it blows up. I have a much harder time finding out what is happening in Harrisburg than in Washington.

We have to change that. One of the best ways I know is by getting involved in your local free market think tank.  These folks are making a huge difference around the country. They do the research and present the case to their own legislators about policies that work by empowering citizens.

They deal with a wide variety of issues in addition to health care – school choice, taxes, environment, criminal justice, transportation – pretty much everything a state or local government does. That means the people who run them are spread pretty thin.  They may be expert in a single area, or they may be general economists or political activists. Rarely do they come from the business community, or have hands-on expertise in a field like health care.

You can help. Obviously, donating money to them is always welcome, but offering your own expertise is every bit as important. They need knowledgeable people to help write papers and op-eds, to make presentations at meeting, to testify before the legislature. Even just giving them encouragement can be helpful when the chips are down.

You can find the think tanks in your area by going to the web site of the State Policy Network. They maintain a directory of every free market think tank in America and they provide resources to help the local groups get stronger and better.

Your participation has never been more important.

Sebelius on CLASS, Read Bait and Switch

By Ross Schriftman, RHU, LUTCF, ACBC, MSAA

Starting sometime toward the end of next year, American workers will be asked to put their hard earned money into a new government program for long term care called the Community Living Assistance Services and Supports (CLASS) Program.  The CLASS Act is part of Obamacare and is supposed to generate $70 billion in revenue to the Federal government from the voluntary contributions of participants.  The likelihood that Americans will make a conscious decision to send their money to a government that is $14 trillion in debt with the expectation that sometime five years AFTER they start contributing they may be eligible for a benefit of as little as $50 per day to help pay for their long term care services is doubtful.

In addition, both well respected Actuary Associations have called the program unsustainable because of its poor design and lack of underwriting for participants.  The President’s own Fiscal Commission also called the program unsustainable and recommended reforming it or repealing it entirely.

In its original form when first proposed the average premium was to be around $60 per month per worker.  Both the government and the reports by the Actuary Associations now peg the expected average premium needed to sustain the program at more than $160 per month.  The actual amounts will be determined by the Department of Health and Human Services (HHS) through its regulatory authority given to it by the Act.

Realizing that no one in their right mind would voluntary give up $160 per month of their personal funds with the expectation of getting some vague promise from the government that they might get some funds for long term care services no sooner than five years down the road, HHS Secretary Sebelius is now doing what regulators claimed private long term care insurance companies have done in the past; bait and switch.  She is proposing that premiums start out lower and increase as “benefits increase.”  Don’t take the bait.  This is just a blatant attempt to make Obamacare’s numbers come out closer to what the Democratic Leadership put into the bill in order to try and convince us that the entire program will not add to our national debt.  If people don’t contribute $70 billion to the CLASS Act, that is less money for all the new expensive stuff contained in the rest of the legislation.  They consider your contributions “revenue” to the Federal government and not reserves to pay future claims.

Sebelius now suggests that she may be “looking at options for indexing premiums so they would rise with benefits.”  Although she claims that this information would be “transparent” to the buyer she doesn’t say that the legislation allows the government to raise the premiums whenever they decide that the program is not financial sound.  Before passage of Obamacare I wrote to members of Congress and asked them to include a full disclosure statement for Americans concerning enrolling in Class.  The disclosure would include the expected premiums over the first five years when the participant receives no benefits, information about the current and expected future cost of long term care services and the fact that Class participants do not have the rights and benefits of real insurance.  They do not get a policy or even a coverage certificate.

Here is the speech Sebelius recently gave concerning the Class Act
Here is the article published in The Hill:

I predict that the average premium that HHS will come up with will be around $100 per month.  That way the Administration thinks they can attract more of us to participate. They will then guarantee that rates will rise over time.  If government gets enough people to contribute and then drop out of Class before they become eligible for benefits then that $70 billion doesn’t all have to be used to pay claims.  It just remains with the government to pay for the rest of Obamacare.  What a concept!

The alternative for most Americans to this new government program is a privately owned long term care insurance policy purchased while a person is still in general good health with rights and benefits spelled out in the contract with the insurance company.  It is true that premiums can be increased but only on a class basis and only with the approval of State Insurance regulators. The Class Act does not provide this kind of protection.  It is not insurance as there will be no policies issued and the government can change the rules and premiums at will.  Imagine any long term care insurance agent trying to sell a client such a poorly designed program like Class.

Here is James Capretta’s article on the subject appearing in the National Review.