### BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION

WASHINGTON, DC
Comments of ) ORBITZ WORLDWIDE, LLC. ) ) Docket No. OST-2013-0048 On the Agreement Adopted by ) The Passenger Services Conference of ) The International Air Transport Association (IATA) ) As Resolution 787 )

COMMENTS ON APPLICATION FOR APPROVAL OF AN AGREEMEN T (RESOLUTION 787) BY THE INTERNATIONAL AIR TRANSPORT ASSOCIATION (IATA)

Orbitz Worldwide submits the following response to the March 11, 2013 application by the International Air Transport Association (IATA) for Department of Transportation (DOT) approval of its agreement adopted as Resolution 787

.
Orbitz Worldwide is a leading global online travel company that uses innovative technology to enable leisure and business travelers to research, plan and book a broad range of travel products. Orbitz Worldwide owns a portfolio of consumer brands that includes Orbitz (www.orbitz.com), CheapTickets (www.cheaptickets.co m), ebookers (www.ebookers.com), HotelClub (www.hotelclub.com) and corporate travel brand Orbitz for Business (www.orbitzforbusiness.com). In addition, our Orbit z Partner Network offers a full range of private label solutions to other partners who wish to sell travel, including many of the world’s leading airlines and the American Express Consumer Travel Network.

On behalf of the millions of travel consumers who u se our sites, Orbitz Worldwide is interested to learn more detail about the developme nt of Resolution 787 and the included New Distribution Capability (NDC). The fact that so man y questions remain unanswered, and that the only notable support for the NDC comes from IATA an d its members suggests that the Department will be challenged to find ways that thi s proposal is in the traveling public’s best interest. As a company that prides itself on provid ing expert travel advice by using cutting-edge technology, we recognize the benefits of developing new technology and modernizing business

### processes to improve the consumer experience. At th e same time, we also remain fully

committed to the preservation and expansion of tran sparent comparison shopping, consumer choice, and consumer data protection and privacy. T hese broad goals are not mutually exclusive, but could be at odds under the IATA proposal.

The introduction of NDC into the marketplace impact s all levels of the travel supply chain and raises some implications for the protecti on of consumer privacy. Section 3.1.1 of the application appears to allow airlines the right to demand personal traveler information that “includes but is not limited to the customer’s name , age, marital status, nationality, contact details, airline loyalty program numbers, prior pur chase and travel history, and whether the trip is business or leisure.” The nature of many of these c lassifications raises significant questions as to the relevancy and intended use of this private info rmation. As these categories expand (and even with the current list of categories), much of this information may not be sufficiently relevant to the carriers’ legitimate business interests to just ify the intrusion into personal privacy. At what point in the developing menu of traveler informatio n sets will personal data be deemed off-limits to carriers, and who will make that determination a nd enforce its non-collection?

Furthermore, we see significant risk that this new “personalization scheme” will be used to drive price discrimination against certain trave lers based solely on personal attributes. In order to maximize revenue, airlines have implemented very effective revenue management systems that charge different prices for different tickets based on supply, demand, advance purchase window and other criteria relating to the service b eing purchased. To extend the reach of such revenue management systems beyond the attributes of the ticket being bought to the attributes of the individual making the purchase is something tha t we believe would introduce significant risks to consumers, and would be unprecedented in a ny industry.

If access to fare and fee data hinges upon the prov ision of traveler-personal information, what will that mean to consumers looking to compari son shop, and to businesses such as our website Orbitz.com, which facilitates that comparis on shopping? What will it mean when travelers seeking price quotes and itinerary option s turn to online or traditional travel agents, who must now collect significant amounts of data fr om each traveler for each exploration of fares across suppliers? How will the NDC scheme all eviate the growing consumer confusion

### over ancillary airline fees and services? Will thos e consumers who reject this demand not be

granted anonymous means of access to the lowest pos sible fares and fees or the best scheduling choices? IATA has not addressed why this informatio n is ultimately necessary, or how consumers who do not want to reveal their private a nd personal identifying information can still obtain access to the best fares, fees and flights. We would also be interested to learn which nation’s privacy standards will dictate the handlin g of consumers’ personal information collected by carriers under the worldwide NDC schema, since t hey vary widely.

It seems that the airline industry is looking at ot her marketplaces and trying to emulate what might be happening there and applying it to it s industry. Indeed, healthcare exchanges are expected to be a useful tool for consumers to compa re and access health insurance—going so far as being referred to as “an Orbitz for health insur ance” (see attachments). And in the process of collecting information for the healthcare exchange quote, personal data like age, sex and marital status might be secured in order to offer the consu mer price and plan options. But that is for data to be used in an actuarial model that measures risk factors. Airline passengers should not be treated in the same manner. There is no “risk” in s elling a consumer an airline ticket. If anything, the risk is on the consumer, because most airlines have very restrictive fare rules that penalize the customer, not the airline, for any change of pl ans or special circumstances.

We are significantly concerned that airlines could use personal information gathered in this way to suppress competition and reduce consume r welfare by stifling businesses such as ours that enable price comparison and ensure a leve l playing field. Specifically, we are concerned that airlines would use the personal iden tifying information revealed as part of a search on a price comparison website to immediately remarket to that consumer directly, using information about the trip already revealed—informa tion that is not currently available to airlines under the current model, but would be made availabl e under IATA’s proposal. To do so could significantly weaken the business model of an inter mediary and reduce price comparison options available to consumers. We find it particularly tro ubling that it is an industry association that is seeking to make this change rather than a collaborative effort involving all stakeholders, and see significant risk that this scheme will be used as ameans to favor single supplier websites over websites that offer consumers choice and the abilit y to compare.

### Airlines are our suppliers and business partners an d we have every reason to see the

industry flourish. But Resolution 787 looks to be away to give airlines leverage by limiting consumer choice and access to an open marketplace. IATA has created the controversy surrounding the NDC proposal by choosing to exclude affected parties and raising consumer privacy issues and has built a steep hill for the D epartment to climb to reach a determination that Resolution 787 is in the public best interest.

Sincerely:

Chris Chiames Vice President of Corporate Affairs Orbitz Worldwide 500 West Madison Street, Suite 1000 Chicago, IL 60661 (312) 260-2344 chris.chiames@orbitz.comMore than 100,000 U.S. employees will be able to sign up for health insurance through a new corporate exchange launched by Aon Hewitt. More than 100,000 U.S. employees at mid-sized businesses will sign up this fall for health insurance through a new corporate exchange with the ability to choose plans from multiple carriers.

Aon Hewitt (AON), the human resources and health benefits consultancy, said Thursday its exchange will turn “selecting health benefits into a retail shopping experience” akin to Amazon.com (AMZN), Orbitz (OWW) and others. The benefits will be offered by n ine national and regional carriers, including UnitedHealth Group (UNH), Cigna (CI) and Health Care Service Corp., which operates Blue Cross and Blue S hield plans in Illinois, Texas, Oklahoma and New Mexico. The effort is similar to the exchanges that are bei ng created by states that will offer health options to uninsured individuals and s mall businesses in 2014 under the Affordable Care Act signed into law two y ears ago by President Obama. But Aon Hewitt said its model will offer group heal th insurance to employers with more than 100 workers who are not eligible to use the state or federally operated exchanges at least until 2017. These emplo yers are not self-insured and generally don’t have as many choices as they ex change plans to offer. Rather, they purchase so-called fully-insured healt h plans that are regulated by states. Each employer in the exchange decides on the subsid y or “credit” that each worker will get to purchase coverage. Then, the emp loyees take to the exchange to select their coverage. The subsidy will vary from employer to employer. No matter what happens to the future of the Afforda ble Care Act depending on the outcome of the federal presidential election , an Aon Hewitt PHARMA & HEALTHC ARE | 9/27/2012 @ 12:00AM | 24,530 views 

# In Boost For Insurance Exchanges, Aon Launches Retail Health Plan Shopping

Bruce Japsen , Contributor I write about health care and policies from the pre sident's hometown In Boost For Insurance Exchanges, Aon Launches Reta il Health Plan Shop... http://www.forbes.com/sites/brucejapsen/2012/09/27/ in-boost-for-insura...

1 of 2 5/1/2013 9:27 AMspokeswoman said its “model will exist with our wit hout the state or federal

exchanges.” The hope by those involved is it will make health p lans more competitive and lead to better prices for consumers just like onlin e retail shopping has done in other industries. “There are examples in every industry, including iT unes, Amazon.com and Orbitz, where the introduction of competition on a retail, consumer level has driven down prices and made the industry more effic ient,” said Ken Sperling, Aon Hewitt’s national health exchange strategy lead er. “The Aon Hewitt Corporate Exchange is a viable alternative for comp anies searching for solutions that can reduce cost, transfer risk to in surers, empower employees to make smarter health care choices and create a mo re sustainable health care benefit program.” Among the companies expected to participate include Sears Holdings (SHLD), according to sources close to the exchange and its participants. “Private health care exchanges enable employers to offer a wide range of health insurance options so their employees can cho ose a health care plan that is best suited for them and their families,” E lizabeth Winsor, chief executive officer of UnitedHealthcare National Acco unts, said in a statement.

This article is available online at: http://www.forbes.com/sites/brucejapsen/2012/09/27/in-boost-for- insurance-exchangesaon-launches-retail-health-plan-shopping/ In Boost For Insurance Exchanges, Aon Launches Reta il Health Plan Shop... http://www.forbes.com/sites/brucejapsen/2012/09/27/ in-boost-for-insura...

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## What are Health Insurance Exchanges

Exchanges are the central mechanisms created by the health reform bill to help individuals and small b usinesses purchase health insurance coverage. Beginning in 20 14, an Exchange will be established in each state t o help consumers make valid comparisons between plans that are certified to have met benchmarks for quality a nd affordability. The Exchanges will also administer t he new health insurance subsidies and facilitate en rollment in private health insurance, Medicaid and the Children 's Health Insurance Program (CHIP). Nobody will be required to purchase health insurance through the Exchange, tho ugh subsidies will only be available for plans sold through the Exchange. If you would prefer to buy your insurance through an insurance agent or broker, you will be free to do so. If not, you will be able to purchase insurance in a matter of minutes on the Exchange’s website.
The District of Columbia is currently in the planni ng stages for implementing the Exchange.
How the Insurance Exchanges Will Work
The Exchanges are being compared to websites such a s Travelocity or Orbitz, but they’ll be set up for you to buy health insurance rather than book travel and hotels . Starting January 1, 2014, those who want to buy p rivate health insurance for themselves and their families will be able to use these state-run exchanges to find bett er deals. Instead of searching individually for an insurer, you’ll be able to use the exchange to choose a private plan from a menu of options. Plans cannot refuse to sell you a policy a nd must comply with the new consumer protections.
Insurance plans will vary—from generous to modest—but each plan must include basic, comprehensive medica l coverage and prescription drug benefits. As with th e online travel services, you’ll be able to compare the plans’ costs and benefits head-to-head online. What policies wil l cost is not yet known, but there will be annual l imits on how much you have to spend on your deductible and copays. Su bsidies or tax credits will be available if you hav e a low or moderate income.

More information on the Exchanges is available here

.



### Program at a Glance
Program Title: What are Health Insurance Exchanges Type: Outreach and Education



### Goals
The health reform bill to help individuals and smal l businesses purchase health insurance coverage. What are Health Insurance Exchanges http://dc.gov/DC/Health+Reform/Insurance+Coverage+O ptions/Health+In...

1 of 2 5/1/2013 9:04 AMView this article online: http://www.insurancejournal.com/news/midwest/2013/0 2/19/281470.htm 

# Michigan Lawmakers Mull $31M For Health Care Exchange

Michigan Gov. Rick Snyder’s administration told law makers it needs their approval within weeks to spen d a $31 million federal grant to help build a consume r-friendly health insurance marketplace under the contentious federal health care overhaul, or else t he state will be stuck with a bill. Though Republicans rejected the GOP governor’s requ est to spend federal money on a state-run exchange last year, the issue is not going away because open enrollment for hundreds of thousands of uninsured Michigan residents is less than eight months away. The new online exchange, likened to Travelocity or Orbitz, is supposed to make it easier for people an d businesses forced to carry health insurance under the Affordable Care Act. Snyder now is pursuing a partnership exchange contr olled primarily by the federal government. If legislators do nothing, federal officials could set up and run the marketplace. Either way, the state has to make technology change s to link electronically with the federal exchange because it will be used to determine people’s eligi bility for Medicaid and – if they buy private insur ance on the exchange – whether they qualify for income-base d federal aid to help pay their premiums. “We are still going to get calls. People are going to be coming to the state with questions. That is a n administrative cost,” Chris Priest, who is managing the state’s exchange project, told a House budget subcommittee. Spending the $31 million grant will save the state from having to divert its own dollars from elsewher e in the budget, he said. He also argued that having a p artnership will save Michigan insurers wanting to o ffer health plans on the exchange from an extra layer of regulation in Washington. Another benefit is while the U.S. government will r un the website and call center, the state will have an oversight role and be able to hire customer-assista nce specialists so people can get face-to-face assi stance, Priest said. Snyder’s request is renewing debate within the GOP- led Legislature over whether to accept that Preside nt Barack Obama’s signature domestic achievement is th e law, or to fight it every step of the way. “I don’t support Obamacare, but I don’t have (an) O bamacare phobia – whereby I think it’s just going t o go away if we do nothing,” said Rep. Al Pscholka, a Stevensville Republican. “On Oct. 1 there’s going to be an exchange and on Jan. 1 of ’14 you have to hav e health insurance or pay a fine.” Michigan Lawmakers Mull $31M For Health Care Exchange http://www.insurancejournal.com/news/midwest/2013/0 2/19/281470.htm...

1 of 2 5/1/2013 10:07 AMHe said it makes no sense for Michigan-based makers of medical devices – which will start paying a 2.3

percent tax in 2014 to help pay for the law – to se e their taxes not used for the exchange. But Rep. Anthony Forlini, a Republican from Macomb County’s Harrison Township, is on the fence. He expressed concerns that the government-run marketpl ace will undercut private insurance agents and wondered if it would be better to send all calls re lated to the health care law to federal officials. “I’m trying to figure out how to get to a yes,” For lini said. Many business groups friendly to Republicans suppor t appropriating the $31 million grant, but conservatives and tea party groups oppose it along with Snyder’s call to expand Medicaid under the Affordable Care Act. Grassroots in Michigan founder Joan Fabiano said if legislators turn down the money, they can thwart t he federal government’s move to carry out the law. “It’s highly unlikely at this point that a federal government that is in debt and out of money has the means to implement it in well over 20 states that are ref using to implement it themselves,” she said. A Senate budget subcommittee plans to get a similar update on the health exchange Thursday. Snyder wants a spending bill sent to his desk by the end o f this month, and it is unclear when or if lawmaker s will act.

Copyright 2013 Associated Press. All rights reserve d. This material may not be published, broadcast, rewritten or redistributed.

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