How to Successfully Sell Medicare Plans

Potential sales people call my office every day and tell me they would like to start selling Medicare plans. They feel the senior market is the place to be and want to get started selling right away. Nine out of ten of these people do not even make it out of the first month. I am going to share what they do wrong and how you can avoid the pit falls that kept them from getting off the ground.

The following information I am sharing is based on my trial and errors selling Medicare and health plans for the last 14 years. I have also worked with hundreds of agents with an array of backgrounds and skill sets. Here is a summary of how you can get started and be successful in Medicare sales.

Insurance license and Errors and Omissions: You must have a valid insurance license in the state you plan to do business in. Many carriers will also require you to have E and O insurance. There are a number of E and O carriers. NAPA usually has good pricing which should be in the $500 to $600 a year range.

Education: One of the biggest mistakes made is that people try to sell Medicare Plans without understanding Medicare. You need to understand Medicare A and B before you can feel confident selling people plans to supplement their Medicare A and B coverage. Find a copy of the “Medicare and You” book and read it 2 or 3 times to get started. Then talk to someone who has been selling plans for at least a few years to get some real life explanations. There is also a number of presentations online that give a high level overview of original Medicare. These types of presentations will help you with the basics as well.

Company Appointments: You need to be appointed to sell at least 2 different companies that offer Medicare Advantage and Medicare supplement plans in the area you will be working in. As time goes on it will be helpful to be appointed with most if not all of them but that would be too overwhelming to start. Two companies will get it done in the beginning. Again, use the internet to get an idea of which companies are competitive in your area. There are also a number of Medicare Wholesales websites that will allow you to do basic comparisons in any given zip code.

When you get the company supplies, review the summary of benefits multiple times. You should be able to rattle off the copays and benefits off the top of your head. Go through the applications and know then from start to finish.

Consider using a whole seller, FMO or marketing organization: They are companies that have contracts with multiple insurance companies. You may be able to obtain all your different Medicare company insurance contracts through one of these organization.

Try to review some basic summaries to see who has the most competitive advantage plans and then call them to start the appointment process. For supplement plans, you can use the state insurance department website to find who has the best rates. (Rates are the key difference in supplement plans)

Lead Source: Once you have completed your company appointments, certifications and received the sales supplies, you need to find some leads. Many agents will try to rely on personal contacts and referrals. This is a great supplement to your business but will not be enough to keep you busy or pay our mortgage. You will need a primary lead source. I would suggest the following types.

Mailers: Use a mail house. You will pay about $400 per 1000 mailed and get a 3% response. This should buy you the mailers, the postage and the return cards to your mailbox or inbox for this price. If the mail house wants more money per 1000, find a different mail house.

Online Leads: You can purchase leads online. Warning: online leads can work great for the right person but can be a total waste for some. Talk to the online lead company to get suggestions. There are a lot of good pointers for online leads but that will need to be in my next article.

Supplement phone leads and Pre Set appointments: Supplement candidates can be legally called (assuming DNC guidelines are followed). You can pay companies to pre set supplement appointments for you but you cannot make an Advantage sale at those appointments. A good cost for pre set supplement appointments is $18 to $24 per appointment

Some agencies will provide you with leads at no cost but with a reduced commission. This can often be a good deal for many new people in the business, just make sure there are no other strings attached.

Understand the LIS and MSP programs in your state: This is one of the biggest mistakes new and experienced sales people make. They are not familiar with the different Rx and Medical help programs for seniors in their state. Knowing these programs can lead to many additional sales and can help you close your existing sales. You must know the income levels for your state. Drug and copay help programs can create a special election period to sign someone up for a plan outside of AEP.

Understand how full Medicaid works in conjunction with a supplement or Advantage plan: Most sales people have no clue when it comes to Medicaid interaction with original Medicare, Advantage plans and supplements. A lack of understanding by the agent will cost him/her a number of sales.

Be contracted to sell other lines of business: If you are working hard to run appointments, you will certainly see clients that are looking for other services as well such as Hospital Indemnity plans, Final Expense plans, Annuities, Dental and Vision benefits, etc. The more services you can provide the better you will do.

Effort, Persistency and tracking: Work hard to educate yourself as much as possible. Be persistent when working leads (polite but persistent) and understand that you will not get an appointment with everyone or close every sale. Be sure to track your appointments and clients. Keep a list of client and prospects and remember to stay in touch with them.

This is a very basic introduction to Medicare sales but is it a good place to start on your road to Medicare Sales success.

Medicare Supplement Plans – What Are Guaranteed Issue Periods and When Do They Occur?

Medicare Supplement plans have certain “Guaranteed Issue” periods that allow individuals to apply for a plan without denying you coverage, excluding your pre-existing conditions, or charging you more because of any health conditions. These guaranteed issue (GI) rights are Federally-mandated by the Centers for Medicare & Medicaid Services and apply to you all Medicare-enrollees who are in one of these specific situations.

The GI rights generally occur when your current health care coverage is changing in a certain way or you are involuntarily losing your coverage. Specific insurance companies may create their own GI situations, and they do; however, there are seven Federally-prescribed GI situations that all Medicare Supplement insurance companies must follow. If you fall into one of these periods, you should be able to sign up for a Medicare Supplement plan on a Guaranteed Issue basis. These seven situations are:

  1. You have employer or union coverage that pays AFTER Medicare, and that coverage is ending.
  2. You are enrolled in a Medicare Advantage plan, and this plan is leaving the Medicare program, stops servicing your area, OR you are moving out of the plan’s specific service area.
  3. You have a Medicare SELECT policy, and you are moving out of the plan’s service area. You can keep your current policy, but you do have the right, on a GI basis, to switch to a new policy.
  4. Your Medicare Supplement company goes bankrupt, which causes you to lose coverage. OR, you lose Medicare Supplement plan coverage through no fault of your own.
  5. You enrolled in a Medicare Advantage plan or PACE when you were first eligible to enroll, and within a year of joining, you wish to switch back to “original” Medicare (and a Medicare Supplement plan).
  6. You dropped a Medicare Supplement to switch to a Medicare Advantage or Medicare SELECT policy for the first time. You have been in that plan for less than a year and wish to switch back to Medigap.
  7. You decide to drop a Medigap policy or leave a Medicare Advantage plan because the company hasn’t followed the rules or misled you in some way.

Individual states also have the authority to create additional GI situations, and some have done so. Also, some of the specific GI situations have particular requirements for the plans that you can go into. For example, you may be eligible for a GI into a Medicare Supplement plan; however, it may have to be one of certain plans.

It is advantageous for you to be aware of these guaranteed issue situations if you are on Medicare. If you fall into one of them and elect not to sign up for a plan while that GI period is in effect, you will, most likely, have to qualify medically for a Medicare Supplement if you do decide to sign up at a later time.

What You Need To Know About Medicare Supplement Plan J

Should you keep your Medicare supplement Plan J or compare other plans?

Oftentimes referred to as Medigap Supplement Plan J, Medicare Supplement Plan J covers certain costs that are not covered in basic Medicare benefits coverage. Unfortunately, Plan J is no longer available (effective May 31, 2010). However, the plan will remain in effect for those individuals who were enrolled in it by the 1st of June, 2010. Additionally, there is a separate $250 annual deductible.

What Does Plan J Cover?

As with any Medicare Advantage or Medigap Insurance plans, Plan J covered certain gaps in Medicare Part A and B coverages. This includes:

• at-home recovery

• care provided by skilled nursing facilities

• emergency care when traveling overseas

• excess Part B charges/expenses

• Medicare co-insurance (Part B)

• Part A and B deductibles

• up to $120 of preventative care that Medicare does not cover

What The Plan Does Not Cover

Unfortunately, there are certain health care issues that are not covered by Plan J (according to the Centers for Medicare and Medicaid Services) including the following:

• dental care

• eyeglasses

• hearing aids

• long-term nursing home care

• private-duty nursing

• vision care

The bottom line is that the elimination of Plan J resulted from the need to modernize the entire Medicare Insurance infrastructure.

Elimination By Default

It has oftentimes been said that Plan J was simply eliminated by default because there were two benefits covered that were similar to the ones covered by Plan F. Plan F has oftentimes been considered the most comprehensive of all the MA/Medigap plans. The two specific benefits that set Plan J apart from Plan F are at-home recovery and preventative care. The Centers for Medicare & Medicaid Services have eliminated these two coverages due to a lack of use. Therefore, Plan J was eliminated because of this duplication.

Additional Considerations

It is important to note that existing Plan J policy holders who are not affected by the above will be subject to what is referred to as a “closed block of business”, meaning that no new policies will be offered after the June 1st eligibility date. There is considerable speculation that the rates for Plan J coverage are going to increase as a result of the above. Although this does make sense to some, the impact on current policy holders remains to be seen. It is a good idea for anyone who has Plan J to evaluate the current Medigap Plans available and compare the benefits and premiums to what they are currently paying. They may be surprised to learn they can save money and get comparable benefits to Plan J.