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Photo: Getty Images

Employers often turn to brokers to help them find the right health care plan for their workers. But there's a catch: Brokers have several layers of incentives to steer companies toward plans with higher premiums.

How it works: For starters, brokers' commission is a percentage of the plan's total annual premium. Higher premium, higher commission. But there's more, as ProPublica reports.

  • Insurers offer brokers big bonuses to the agents and brokers who rake in the most business, including cash (up to $100,000 per employer) and trips to the Bahamas.
  • Those bonuses are built into the insurance plans' premiums, but the costs aren't disclosed to employers unless they ask.
  • "It's a classic conflict of interest," Eric Campbell, a University of Colorado bioethicist, told ProPublica.

Some brokers are trying to do better, switching to flat fees instead of commissions, hoping to draw a sharper contrast with agents who may not have the employer's bottom line in mind.

  • But even efforts to work around this incentive structure can go awry.
  • Morris County, New Jersey paid its broker directly, in an effort to make the broker unbiased about which plans it recommended. The broker collected that fee and also a $235,000 commission from Cigna, according to the lawsuit.
  • It also accuses the broker of hiding the costs of switching to a Cigna plan, including $800,000 in administrative fees.

Go deeper: The unclear benefits of drug price coalitions

Go deeper

Kendall Baker, author of Sports
2 hours ago - Sports

2021 Tokyo Olympics hang in the balance

Illustration: Aïda Amer/Axios

10 months ago, the Tokyo Olympics were postponed. Now, less than six months ahead of their new start date, the dreaded word is being murmured: "canceled."

Driving the news: The Japanese government has privately concluded that the Games will have to be called off, The Times reports (subscription), citing an unnamed senior government source.

Biden's centrist words, liberal actions

Illustration: Sarah Grillo/Axios

President Biden talks like a soothing centrist. He promises to govern like a soothing centrist. But early moves show that he is keeping his promise to advance a liberal agenda.

Why it matters: Never before has a president done more by executive fiat in such a short period of time than Biden. And those specific actions, coupled with a push for a more progressive slate of regulators and advisers, look more like the Biden of the Democratic primary than the unity-and-restraint Biden of the general election.

3 hours ago - Technology

Review of Trump ban marks major turning point for Facebook

Photo Illustration: Aïda Amer/Axios. Photo: Saul Loeb/AFP via Getty Images

Facebook's decision to ask its new independent Oversight Board to review the company's indefinite suspension of former President Trump is likely to set a critical precedent for how the social media giant handles political speech from world leaders.

What they're saying: "I very much hope and can expect … that they will uphold our decision," Facebook's VP of global affairs Nick Clegg tells Axios.