Health insurance agents, feeling threatened by the Affordable Care Act, will welcome research from the University of Minnesota that supports their longstanding argument that agents and brokers make insurance shopping easier and cheaper.
A new paper by economist Pinar Karaca-Mandic and colleagues finds that small employers were more likely to offer medical coverage in markets with many brokers competing for business and offering health plans. "We also find that increased agent/broker competition is associated with lower premiums," they wrote. …
Karaca-Mandic found that small firms were about 20 percent more likely to offer health coverage in counties with the most brokers serving small firms than in counties with the least. The data are from 2008. In counties with the fewest brokers, the average annual premium for a single employee was $5,173. In counties with the most brokers, the annual premium was $4,495 — 13 percent less.