eHealthInsurance will be working as a web-based broker for the federally-run health insurance exchanges, helping enroll consumers through its websites.
Stocks for the Mountain View, California-based eHealth rose 20 percent Wednesday, after it announced an agreement with the Centers for Medicare & Medicaid Services to serve as a broker under the category of web-based entity -- a quasi-broker position CMS created in a March 2012 regulation.
Through its website and advertising presence, eHealth is now set to help enroll tax subsidy-eligible residents in the 36 states where CMS is operating insurance exchanges.
The agreement also spells out eHealth's access to the federal data hub linking CMS, states, the Internal Revenue Service and other federal agencies to verify applicants' identity and income.
eHealth's CEO Gary Lauer said that for data management, the agreement includes "strict consumer- and privacy-protective" requirements and "standards beyond those spelled out in regulations."
Lauer has long tried to argue for a role for eHealth, and other private insurance exchanges, as part of the ACA's massive get-out-the-enrollment campaign -- the idea being that people searching for insurance online who stumble upon eHealth can then see their health plan options with qualifying subsidies.
"We now hope that the 14 states and DC that are working hard to develop their own health insurance exchanges will follow the leadership of the federal government and allow their subsidy-eligible residents the same opportunity that is expected to exist in the 36 other states to utilize resources like eHealth.com for enrollment," Lauer said in a media release.
"This will simply result in more enrollments, which is crucial to the Affordable Care Act's success, and at the same time save the government taxpayer money," Lauer said. eHealth will essentially perform the enrollment free for the publicly-funded exchanges, while collecting a small broker's fee from the health plans.
Lauer, a cancer survivor and the company's CEO since 1999, has been arguing that the web may be the main enrollment avenue for exchange applicants, particularly young people who regularly use the Internet on mobile devices.