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Health Care Reform- Where Does the National Association of Realtors Stand?

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National Association of Realtors’ Brief

As tensions mount across the nation regarding the “America’s Affordable Health Choices Act of 2009” also known as HR3200, unrest is visible at town halls across the nation and feel our readership would be interested to know where the National Association of Realtors stands on the issue.

It is common knowledge that Realtors as independent agents and small businesses suffer from lack of coverage, especially now that a down market slashes agents’ budgets, NAR has long lobbied for legislation to make healthcare more realistically affordable for agents.

This month, NAR Government Affairs published a public brief addressed to the federal political coordinators across the nation and outlines the NAR’s position on HR3200.

In the brief, NAR gives some background to the issue noting that 28% of NAR members are uninsured and 39% of firms are unable to insure administrative staff and reiterating NAR’s long standing support of opening insurance across state lines in an exchange that allows small businesses (Realtors) to band together across state lines and garner affordable insurance plans.

Where does NAR stand?

“NAR has yet to take a position for or against any of the bills as a whole” but outlines how HR3200 could be improved and airs NAR concerns, here are the highlights:

Treatment of the self-employed:

“Given the diverse nature of the self-employed, their business models and individual circumstances, allowing the self-employed to choose whether they participate in reforms as individuals or as small businesses is the right way to determine where the self-employed fit into a health reform framework.”

Exchange:

“NAR has concerns with the bill’s provisions that would allow the creation of state-based Exchanges, which we believe would do little to reduce the higher administrative costs associated with individual and small group policies.” (Note: emphasis is theirs, not ours)

“NAR believes that one national Exchange or a limited number of regional Exchanges would better serve the nation than a system of 50+ mini-Exchanges that replicates the existing dysfunctional state-based insurance markets.”

Rating rules:

“NAR is pleased to see that the proposed AAHCA market reforms include: Uniform federal rating rules for the individual and very small employer markets; Guaranteed issue and guaranteed renewal rules, and A prohibition on health status and pre-existing conditions as underwriting criteria.” (Note: NAR’s 2009 Member Profile Report states that the median age of Realtors is 54 years old.)

Benefit options:

“NAR has concerns with the bill’s procedure for determining what constitutes qualified coverage. Extreme care must be taken to ensure that standards recommended by the Health Benefits Advisory Committee are crafted so that qualified coverage products are affordable and meet the varied needs of the targeted population.”

Fragmentation of small business insurance markets:

NAR does not support the bill’s provisions that would divide the small group insurance market into a very small employer group (firms with 10 or fewer employees in the first year, 20 or fewer in year two, with administrative discretion in following years) with access to a national Exchange and a second small firm market of larger small firms with no access to the Exchange. Fragmentation would create an uneven playing field for the self-employed and smallest firms vis-à-vis the rest of the small firm universe and create the potential for some participants to “game” the system. NAR strongly urges that all small employers be given access to the national Exchange.” (Note: emphasis is NAR’s, not ours.)

Individual mandate:

“NAR has serious concerns with the bill’s requirement that all individuals have some source of health insurance coverage. The self-employed are a significant portion of the uninsured today and cost is the overwhelming reason cited. NAR survey research confirms that uninsured Realtors® also find cost to be the greatest barrier. Policies that mandate individual coverage will fall on the self-employed in disproportionate numbers and often with unintended consequences.”

Employer mandate:

“NAR is very concerned with Tri-Committee bill provisions that would require employers with annual payrolls in excess of $250,000 to provide and contribute to employee health insurance or pay a penalty ranging from 2 to 8 percent of payroll. The bill’s employer mandate fails to recognize that not all small firms have the revenues necessary to cover premium costs and the large penalties like those envisioned in the bill will have a detrimental impact on small firms that are responsible for significant portions of job growth.”

Public plan option:

“REALTORS® are concerned with the bill’s proposal that would create a new government-run public health coverage option that would compete with the private insurance products offered through the Exchange. REALTORS® believe the market functions best when there is a level playing field between all providers of a given service. REALTORS® believe it is extremely difficult, if not impossible, for private firms to compete with the federal government… the bill’s proposed public coverage option would operate at a 10 percent cost advantage over private insurance.”

What do you think? Do you agree or disagree with NAR’s assertions? What do you think will happen with HR3200? Are you involved in healthcare reform locally?

Lani is the Chief Operating Officer at The American Genius - she has co-authored a book, co-founded BASHH and Austin Digital Jobs, and is a seasoned business writer and editorialist with a penchant for the irreverent.

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36 Comments

36 Comments

  1. Real Estate Feeds

    August 14, 2009 at 4:39 pm

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  2. RealEstate Babble

    August 14, 2009 at 5:17 pm

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  3. Bridget Magnus

    August 14, 2009 at 6:10 pm

    Let me get this right. NAR doesn’t take a stand on any of the issues. They are “concerned” about a mandate to have insurance (or, “mandatory insurance” as it should be called). But they are also “concerned” about the existence of a public plan that would compete with the plans offered by for-profit insurance companies, that would almost certainly bring coverage costs down. Way to play both ends! Are they unaware that a large number of us only have health insurance at all because we have employed spouses? If I weren’t required to be a member of this organization to do my job I would be questioning whether I should remain a member.

  4. Bob

    August 14, 2009 at 9:35 pm

    If this bill was passed this year, the earliest it would be implemented is 2013. NAR has to love this because they can continue to do nothing on this front and respond to all members’ pleas with a “We are waiting for the Obama Plan”.

  5. Thomas Johnson

    August 14, 2009 at 10:56 pm

    They would be better off with a no comment. This is the gang that can’t even understand their own IDX rules. Or does IDX have a provision to unplug Grandma?

  6. Erion Shehaj

    August 14, 2009 at 10:56 pm

    Why am I not surprised from the NAR’s on the fence position?

    There are some questions on this issue however, that transcend the NAR and the real estate industry:

    The way I understand it, health insurance, like any other insurance, assesses risk and prices its premiums accordingly. Why is it then, that a 30 year old individual working for Shell is considered less risky than a 30 year old self employed Realtor in similar health? Why do we face miserable options with high deductibles, high premiums and anemic coverage when our corporate employed counterparts have much wider, significantly higher in quality options? Considering the small number of large players in the current health insurance landscape, will opening up insurance markets across state lines have that much of an effect in lowering prices? What about insured individuals who play by the rules, pay their premiums only to be knocked off and declared uninsurable when they get sick? What about tort reform as a means to lower costs by limiting the liability for doctors?

    These are the questions of an independent minded individual that cares about the issue not its politicized faces.

  7. Paula Henry

    August 14, 2009 at 11:03 pm

    Let’s see – NO, I’m not surprised NAR sits on the fence.

    Tom Johnson 🙂

    Bob – I have clients who are still waiting for the Obama plan too – while the sheriff kicks em to the curb.

  8. BawldGuy

    August 14, 2009 at 11:22 pm

    I marvel at those who seriously believe anything the gov’t does when ‘competing’ with the private sector will ever result in lower prices and/or costs.

    It’s almost, no, it is a joke.

    Every time you stick a stamp on a letter remember how well the post office has been run. The next effort made by our federal gov’t to compete with the private business sector that succeeds will be the first.

    Geez, Louise, Myrtle people, can we please get on some sort of learning curve here?

    There, I feel much mo betta. 🙂

  9. Erion Shehaj

    August 14, 2009 at 11:26 pm

    Now that we got the government-can’t-tie-its-own-shoes talk, can I get some actual answers? I felt my questions were tightly strapped to reality.. 🙂

  10. Thomas Johnson

    August 14, 2009 at 11:30 pm

    OK. obamacare is going to “compete” with a for profit enterprise. If that enterprise is indeed profitable, it owes 40% of its profits to the US Treasury in taxes. How long does the private option stay solvent with that kind of disadvantage? Or is there a new bailout for private insurers in the bill so that obamacare has a competitor?

  11. Thomas Johnson

    August 14, 2009 at 11:35 pm

    Erion: The only way we as individuals could get group coverage is by our one million strong association flexing its considerable lobbying muscles to give associations such as NAR group status with the insurance companies. Instead our lobbying PAC gives cash to the likes of the ever humble and caring Sheila Jackson Lee.

  12. Erion Shehaj

    August 14, 2009 at 11:38 pm

    Thomas

    Why is that? Shouldn’t each individual’s “risk” be evaluated individually? That would be the free market approach from where I’m standing. Current group coverage sounds a lot like… what’s that word … ah yes, socialized coverage.

  13. Erion Shehaj

    August 14, 2009 at 11:41 pm

    Just so I don’t get accused just throwing questions around, here’s the right formula for healthcare reform:

    An actual FREE market with REAL competition + Tort reform to bring down costs + stronger consumer protections = A better healthcare system

  14. Matthew Rathbun

    August 14, 2009 at 11:44 pm

    I’ve certainly been vocal about the things I and NAR disagree with… In this case I understand the “no-stance” position.

    Herein lies the problem. Agents love the fact that they are independent contractors when it comes to telling their Broker to “stuff it” or when claiming the myriad of tax benefits. They don’t like it when they have to take their own responsibility for expenses, such as insurance. My experience has been that agents fall into one of four categories when it comes to insurance: a.) They have insurance through their spouse or previous retirement/military experience b.) They pay for their own insurance, understanding they are a business and it’s the cost of being a business – they then happily take the tax right off c.) they don’t make enough, being an agent to really afford to run a buisness and don’t have insurance or d.) They make enough money but choose to not spend it on medical care.

    Where is health care a constitutional right? There are more people in need of jobs and housing than those with life threatening needs that are going without care.

    If NAR was to say “Yeah, we support the healthcare bill” than those who think the Government should stay the heck out of health-care, until they can figure out how to fix medicare/medicaid, transportation and public education will be pissed off.

    If NAR was to say “No, this is a crappy idea and not good for society” than a huge group of members will say, “Look, NAR doesn’t care about our needs”.

    There is no win for NAR in this issue.

    Let me add this:

    For all those who think the Government should be given one more thing to screw up, lets consider the following:

    1.) The medicare/medicaid system is screwed up. Why would we give someone who is failing so miserably in this area more responsibility? If a mechanic totally messed up your car, would you keep taking the car to be repaired? I was an EMS Medic for 10 years, the medicine industry is even more messed up than real estate. The abuse by people is off the charts. Only 3% of most 911 EMS calls are life threatening…

    2) Some have said that their brokers should provide group health plans – that’s fine but then you’d be an employee and couldn’t claim those great deductions and your broker would have to keep more of your commission split, so you’d probably be no further along than you are now. It’s all give and take.

    3.) To put this into a “back-yard” allegory, how about we say that medicine is real estate and because of Short Sales and Foreclosures overwhelming the economy it’s decreed that Real Estate is going to Federalized. Now, all of you (should you wish to stick around) now have 10 times the red tape and hassle to sell a home and the Government will not divide equally amongst anyone with a license all homes for sale. Therefore there is no need to work hard to sell the home, because the same mediocre work ethic that many government employees seem to exhibit will settle in agents. There will be no extra effort to sell the home since you know that you’ll have a steady stream of clients. Your salaries will be fixed. There will be lots of backups, confusion, paperwork and ever changing political atmosphere that will just translate to frustration and a continuance of decline in the how the system works with no help in sight. Don’t think it will happen? Why not? If the government takes over education and health-care what stops them from taking over Real Estate?

    I’d love to see a report outlining the amount of money that an average American pays for commission on real estate versus medical care. I would think the average American spends more on real estate commissions – but none of you are advocating that nationalization of Real Estate Care be federalized.

  15. Thomas Johnson

    August 14, 2009 at 11:49 pm

    You got it amigo! We are choking on a health insurance tab that exceeds my house payment. Also, insurance laws are the domain of the states, not the feds, so each state has a nuanced (read bought and paid for) insurance commission. Ever wonder why Title insurance in Texas is so expensive compared to other states? Probably not because we have more defective titles in Texas. So it goes. The theory behind group coverage is that if you get a large enough group paying premium, the losses to the insurer will be mitigated by the large number of premium paying individuals. NAR is a huge group which could take advantage of these insurance fundamentals. Alas, the NAR is more interested in getting invited to the right cocktail parties inside the beltway, and not taking care of we peon dues payers.

  16. Thomas Johnson

    August 14, 2009 at 11:59 pm

    Matthew: It has only been in the past few years under GW Bush that we could “happily write off 100% of health insurance premium” The NAR has been dodging this issue for much longer than that. A big no comment from NAR would have been the right answer, but they have to straddle to get their cocktail party invites and to have “access”.

    Medicine is not real estate but I have to say the the AMA does a much better job on its members’ behalf. By the way, health care far exceeds RE commissions. My wife had one surgery which exceeded $100k. That is a good agent’s year.

  17. Bob

    August 15, 2009 at 12:29 am

    Good questions, Erion.

    For starters, if they get their way, it wont matter whether you are self employed or not. Dig down a few pounds into this 10 pound stack of paper that NO legislator has read completely, and you’ll find that there is no incentive for an employer to not switch to the govvie product. Quite the opposite, as fees and taxes will be levied for not participating.

    If this passed tomorrow, the only people keeping their current health insurance in 5 years will be our beloved elected officials and their minions.

    Add a rider that requires all of Congress to have the same health care plan offered up in this steaming pile, and it would be DOA.

    Maybe if someone on the NAR PAC actually read this, they would have an opinion.

  18. Mariana Wagner

    August 15, 2009 at 12:34 am

    @erionhouston My initial thoughts: I don’t think health insurance should be mandatory … for anyone, and I do not think NAR should have an opinion about it.

  19. Erion Shehaj

    August 15, 2009 at 12:44 am

    Bob

    Suppose for a second that government is no longer involved in this debate. If you, I and all 300 million other Americans took at look at the current healthcare system, would you say that it needs reform? If yes, in that same framework, what would be the answers to my questions? I’m not partisan and I certainly am not advocating for government involvement necessarily. How can we resolve these issues irrespective of our views on big bad governement or big bad insurance corps?

  20. Bob

    August 15, 2009 at 12:47 am

    “The next effort made by our federal gov’t to compete with the private business sector that succeeds will be the first.”

    @Bawldguy – The thing is that this isn’t about competition. This is about statism.

    @Matthew – I appreciate the points you make, which are valid on all counts. The problem NAR has though is one of their own making. NAR has so muddied the waters with their identity that even their own membership isnt sure of what they are and what they do. Lobbyist for the homeowner, or trade group for the agent? Then toss in the word “benefits” to justify dues, and people start to wonder “Hey, if we are talking benes, instead of bartering our buying power to get 10% off Fed Ex, how about a discount on something this side of catastrophic health coverage?”.

  21. BawldGuy

    August 15, 2009 at 12:50 am

    Bob — That was my attempt at being subtle. 🙂 Of course it’s about statism, which is the polite way of saying Marxism.

  22. Erion Shehaj

    August 15, 2009 at 12:53 am

    talking…points…exhaustion

    Good night, everyone. Don’t get sick … 😉

  23. Bob

    August 15, 2009 at 1:09 am

    Erion – Absolutely it needs reform. Unfortunately I don’t see this as a discussion I can still have with 300 million of my closest friends. That discussion ended with the November 2008 election.

    The only way this discussion gets revived is if this bill dies. That only happens if good men and women who have been elected to serve people serve them instead of their party.

    @Mariana – Unfortunately we have reached critical mass in the US where not solving the health care issue will have severe negative impacts on everyone. We already have health care for the indigent. We have mandatory requirements for minimum health care with children in the public schools. Private insurance costs will only rise without intelligent answers to Erion’s questions.

    Even if we elect to take the stance that health care is an every man for themselves situation, that isnt the case if you have elderly family members to care for or are close to getting on the AARP mailing list your self.

    NAR should have an opinion on this, as this can certainly change the fabric of free enterprise, of which home ownership is at the core.

  24. Benn Rosales

    August 15, 2009 at 1:40 am

    Technically, I think NAR is fine with a no side in the debate right now because there really isn’t a bill to side with at the moment, neither bill put forward is worth siding with nor fit completely within what NAR would support (which they’ve made clear what is worthy in their eyes). In defense of NAR on this issue, it makes sense to put forward what they will support and lobby for those points in an actual working bill.

    sidenote: The president said today that the public option is a member paid system that is being proposed that would not ride the tax dollar, but rather be paid by the actual participants of the plan- I didn’t say this fiction was a reality, but until the actual bill is put forward, we really won’t know.

    The kill grandma part of the bill in the senate has been killed due to the potential to misinterperate the language, this however doesn’t mean it wont find its way back in, but with better language.

    I think for the most part, none of you have any real issues with NARs hopes for what they want to see in the bill, so I’ll drop them a kudo on that point (so far).

    Tort reform and allowing state to state would go a very long way to making a dent, I’m also liking what I’m seeing on the city HMO in Colorado I heard about today. Could it be done nationally, I’m not sure, but as a hybrid state to state, city to city, it’s very interesting.

    I love the debate that’s going on, I love that people are so fired up on both sides of this issue, it feels American on so many levels, but I’m not happy with the feeling that if you have an opinion you should be afraid of the gov, or from some fringe group, I think that needs to stop as I really want to hear what everyone has to say, and my hopes is that in all of the madness, something realistic would come.

    As for who can or doesn’t pay for insurance and for what reason, that’s utter non-sense and ignores the middle of the road family that has astronomical health care costs for whatever reason or ends up uncovered due to pre-existing conditions.

    I don’t agree with Obama on anything, lets make that clear, but I can find some common ground on the notion that it’s about time we did something.

    My parents at one time with health insurance were kicking out a grand a month in medicine alone, and on a fixed income, that’s a nightmare and in some months may go without.

    Carry on 🙂

  25. Erion Shehaj

    August 15, 2009 at 3:02 am

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  26. Paula Henry

    August 15, 2009 at 3:30 am

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  28. BawldGuy

    August 15, 2009 at 12:27 pm

    Hey Erion — Your questions were indeed ‘tightly strapped to reality’ – the private sector’s reality. The problem with answering those questions is the wholly false premise on which the entire subject is based: That the gov’t can ever compete with private business while lowering overall consumer costs, and improving efficiency.

    That, my good friend, may be the poster child for false premise.

    Still, your questions are in the minds of many of us. Truth be told, if the gov’t would simply allow the insurance industry to compete opening, across state lines, and more or less unfettered except for what we’d all surely agree would be required minimum regulation, price would indeed head south while efficiency would increase.

  29. Erion Shehaj

    August 15, 2009 at 1:09 pm

    My questions are not based on that premise, Jeff. If allowing insurance companies to compete across state lines will bring down prices singnificantly and new regulation would protect consumers from being bumped off, I’m all for leaving it to the private sector. I must say though, that I have my doubts about the effectiveness of those measures over the long term.

    See, we are not that far apart once we start talking about specifics 🙂

  30. Bill Free

    August 15, 2009 at 2:58 pm

    For an organization that has not taken a position, this looks an awful lot like a position to me. I’m puzzled that NAR expresses “concern” about agents who lack health coverage, yet seems opposed to any meaningful change to the status quo.

    I’m past weary of those who hold the post office up as a model of government inefficiency, yet at the same time argue that a government option would magically operate at some cost advantage over private insurers. The USPS delivers 220 billion pieces of mail annually at rates that are less than half that charged by other developed nations. While the postal service reported a loss for its 2007 and 2008 fiscals due to declines in mail volume, it turned a profit in 2006. Its express delivery business competes on a level playing field with its main rivals, UPS and FedEx, who play in a far more profitable market space. The USPS earns customer satisfaction scores across all its lines of business in excess of 90% — on par with its competitors.

    The same argument applies to Medicare, which insures a segment of the population largely abandoned by the private sector. Its year-over-year cost increases are primarily a function of the fees it pays providers, not the service it delivers its insureds. This imbalance is one of the issues being addressed in comprehensive health care legislation.

    Face it, folks. If we’re going to curtail runaway health care costs and extend affordable coverage options to individuals and small businesses, there are going to have to be changes.

  31. Joe Loomer

    August 16, 2009 at 10:05 am

    Tort reform should come first – affects more than just the medical sector. Separate it from the argument, pass a reform bill, move on to health care debates.

    Add illegal immigrants to the mix – can they be insured?

    I believe you should either be a citizen or in this country legally. The burden on the medical community and the penal system is already outrageous. Fix that first.

    I’m retired military. When I joined the Navy in 1982 I was promised “Free Health Care for LIFE.”

    By 1994 I was paying for Tricare Prime.

    By the time I retired in 2003, the cost for this plan had tripled.

    Retired now, my premiums are easily 1/3rd lower than most other plans – but that’s not my point.

    If you think ANOTHER Government-mandated health plan is not going to also triple in cost in very short order, you need a urinalysis.

    KW came out with a somewhat reasonable insurance for agents in February. I’ve not done the research to see how many of our 70K plus agents have taken the plunge – so I don’t know if it’s working or not. At least they’re trying.

    My plan – as it is – works for me and my family. I don’t like it but I like the alternatives less. The one thing that does work is that it is set up into regions (four, I believe). This seems to work a lot better than the state exchanges proposal possibly could.

    Navy Chief, Navy Pride

  32. Bob the Realtor

    August 16, 2009 at 3:56 pm

    Who’s kidding who ? The National Association of Realtors want NOTHING to do with ANY Realtor Health Care ! Why should they do ANYTHING for us sheep aslong as we keep paying our dues ?

    Its not like we could ask Jimmy to help us, but let not gather and talk about a Union ~

  33. Brian Summerfield

    August 17, 2009 at 12:16 pm

    Hi everyone:

    Enjoying the debate here. I just want to add that many NAR members can get basic coverage from the REALTORS® Core Health Insurance (RCHI) program. You can find out more about that here:
    https://www.realtor.org/realtor_benefits/benefits_partners/core_health_insurance

    Brian Summerfield
    Online Editor, REALTOR® Magazine

  34. Ruthmarie Hicks

    August 17, 2009 at 8:24 pm

    Hi Lani,

    I’m late to the party because I am a chicken. You are brave to dive right into the fray.

    The issue is complex, but there are some simple conclusions that can be drawn.

    For profit health care is something of an oxymoron. The trouble is that providing good care for the sick is in direct conflict with profit margins. I was

    I was in this field as a researcher for 15 years. Many of the physicians that I worked with were from European countries and they were shocked at how bad the situation was over here. They didn’t understand why we had no national program and were shocked at the costs of the for profit system and how many loopholes were available to dump the truly sick.

  35. Evilkumquat

    August 25, 2009 at 11:49 am

    To me, this seems a no-brainer for the Real Estate Industry.

    1) As the majority of real estate agents are self-employed/independent contractors, their costs for health coverage has to be HUGE. Single payer would help get rid of one gigantic expense to the majority in the industry.

    2) If they weren’t forced to pay premiums through their employers, as well as huge medical bills when the occur, how much more income would individuals have to spend on other things like, oh, I don’t know… HOUSE PAYMENTS?

    The NAOR’s “non-position” position smacks of some incestuous relationship between the large corporate real estate franchises and the insurance industry.

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1. Zillow poaches top talent, Move/NAR sues

It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.

Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.

2. Two major media brands emerge

Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.

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