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Some Carriers Rely on Subsidy Calculator for Leads, Outreach

An online tool created to help consumers determine federal premium subsidy amounts is being used by more than a dozen Blues plans to generate sales leads or to test the effectiveness of outreach and marketing campaigns.

The subsidy calculator, developed by Chicago-based Stonegate Advisors LLC, can determine a person’s eligibility for health coverage sold through a public exchange, calculate federal premium tax credit amounts and display coverage options along with the user’s expected post-subsidy premium. It also gives health plans the option to collect contact information for follow up and outreach. “That was an unintentional benefit,” says Dustin Eggers, a principal at Stonegate, “but it generates hundreds of thousands of leads a year...and they are very qualified leads.”

Since making it available in 2013, prior to the first open-enrollment period for the exchanges, the calculator has become an integral part of the online shopping experience, says Paula Sunshine, vice president of sales and marketing for consumer business at Philadelphia-based Independence Blue Cross. “Folks need to know how much money they’re shopping with,” she explains.

After clicking on the calculator, users enter each family member’s age and income, which is checked against criteria for federal exchange eligibility and the state’s Medicaid eligibility. Health plans have the option to require an email address or telephone number. But even if contact information isn’t required, users tend to supply it because they usually want to talk to someone about their options, Eggers explains.

To generate more leads, Sunshine says the calculator has been made available beyond the company’s website. Through IBX Wire, the company’s secure texting platform, sales staff can send text messages to members and prospects with a link to the calculator. “We can say, ‘tap here for a calculator that’s going to tell you how much of a subsidy you’re entitled to,’” she explains.

Agents and brokers install the calculator on their phones so that they can determine subsidy amounts at community outreach events. And people who call the company’s telesales department are prompted to press a number if they want the calculator texted to their phone while they wait for a representative.

“We wind up with a lead, and the person ends up with a better idea about how health insurance might fit into their life,” Sunshine says.

Like Independence, New York-based Excellus BlueCross BlueShield launched the subsidy calculator to coincide with the debut of public exchanges in 2013. “From a lead-generation standpoint, it was very successful for us that first year,” says Susie Hume, manager of digital marketing at Excellus BCBS. Since then, Stonegate has customized the tool so that potential customers remain on the insurer’s website after the subsidy is calculated. They then receive a list of appropriate Excellus BCBS options and the expected cost once the subsidy is applied. “Being able to provide that kind of value to people when they’re shopping makes it easier to convert on leads and sales,” says Hume.

She says about 90% of people who shop for coverage on Excellus’ website click on the subsidy calculator when prompted to see if they qualify.

Excellus now relies on the calculator to determine the effectiveness of its outreach and marketing efforts. Hume and her team can determine who has used the calculator, where they live and their income levels. That can help the company determine, by region, whether their outreach efforts are reaching the right people.

This year, Hume is optimistic that the calculator will help drive members to a new Basic Health Program (BHP) option. The BHP was outlined in the Affordable Care Act (ACA) as a coverage option that would sit between Medicaid and subsidized commercial coverage. Only New York and Minnesota will offer a BHP for the 2016 plan year through their state-based exchanges.

The New York Dept. of Financial Services on July 31 said the new option — dubbed the Essential Plan — will be available to people whose annual income is between 138% and 200% of the federal poverty level who are not otherwise eligible for Medicaid, the Children’s Health Insurance Program, other government programs or employer-sponsored insurance. Under New York’s BHP, people who earn up to 200% of the FPL ($23,540 for an individual and $48,500 for a family of four) will pay no premium.

The Essential Plan will be similar to Qualified Health Plans (QHPs) sold through the state-run exchange, but will have no annual deductible and low copayments. A person who earns about $20,000 a year and uses moderate health care services, including an inpatient hospital stay, prescription drugs and doctor’s visits, will pay about $730 a year for premiums and out-of-pocket costs under the Essential Plan in 2016, compared to about $1,830 in 2015 if they were enrolled in a QHP, according to the New York Dept. of Financial Services.

Hume says the calculator has been updated so that people who qualify for the BHP receive information about the program and how to enroll through the New York State of Health exchange. Hume says the BHP could be a growth area for the company.

Along with generating leads, the calculator can be used by existing customers to ensure eligibility hasn’t changed. Moreover, people who purchased health coverage through a public insurance exchange last year could see a dramatic change to their subsidy amount in 2016 if they remain in a plan that had a large premium increase. Many of them will be unaware of the change until after they receive their first statement from their carrier.

That could create a public relations nightmare for carriers, warns Eggers. “Someone who had close to a no-premium plan after the subsidy this year might wind up with a bill for $50 to $100 a month,” he says. “If you’re not informing your members about subsidy changes next year, you are decreasing your stickiness with those consumers. Carriers need to be proactive and encourage people to check their subsidies for 2016. That’s the conversation to have to maintain customer satisfaction and decrease the churn.”

Case in point: In Maryland, premiums for CareFirst, Inc.’s exchange-based plans will increase by an average of 26%, the Maryland Dept. of Insurance announced Sept. 4. The Blues plan operator’s policies cover more than 95,000 out of 125,000 people who purchased coverage through Maryland’s state-run exchange for 2015.

Individuals who don’t switch coverage could wind up paying higher premiums in 2016 because subsidy amounts are pegged to the second-lowest-cost silver plan, which typically changes each year. Enrollees who didn’t reapply for 2015 coverage were passively re-enrolled in the same plan and received the same subsidy amount. This year, the subsidy will be recalculated, but will still result in bigger out-of-pocket costs if premiums increased substantially from the prior year, explains Elizabeth Carpenter, a vice president at Avalere Health, an Inovalon company.

Contact Carpenter at, Eggers at, Hume at and Laura Hanes for Sunshine at

Copyright © 2015 by Atlantic Information Services, Inc. Reprinted with permission from Atlantic Information Services, Inc., 1100 17th Street, NW, Suite 300, Washington, D.C. 20036, 202-775-9008,

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