Developing My Insurance Career Plan

[Travis Price]

Hey All,

Long time reader, first time poster:

I'm taking my state exam on Friday and I'm trying to map out my best road would be based on my circumstances and would really appreciate some input from more seasoned professionals.

First things first, I'm planning to enter the market as a part time agent. Currently, I work within the state government department of Health and Human Services. While I enjoy the work of helping people, I'm not so much a fan of government bureaucracy and frankly the culture of government work can be a bit toxic at times. Ultimately, my plan is to leave state service in 7.5 years, after my student loans are forgiven. After that, my only debt will be my house. Also, I'm a DINK.

While I don't work directly with Medicare, I do had some very basic knowledge and have already been working through Medicare and You 2019 to get some additional information.

I'm coming to insurance for a few reasons:
1) I like helping people navigate items that can be really confusing and giving advice. I like creating solutions.
2) I'm very driven, and like the idea of a challenge. Specifically meeting a quota. It makes work sort of like a game for me.
2) I like the idea of the opportunity for high income, but I make pretty good money now. So while money is obviously important, I think if I'd doing something for the right reasons I'll be motivated to do the absolute best I can; then money will come.

So here's the part where I ask for advice:

I kind of like the idea of selling Med Supps, V/H/D, and D w/ trickles of FE. I live in Northern MI and a lot of our people are snowbirds; so Med Advantage is not going to be something that's going to stand out on my radar. I don't like the structure of benefits that can just change whenever, a lot of doctors seem to hate it, and I live in a relatively upper income level of my area within about 2 hour drive.

My question/concerns are as follows:

I can be flexible enough to provide service to clients for Med-Supps throughout the day, but am I doing them a disservice by only having 2-3 hours a for standard doctor hours (assuming doctor offices close around 4:30-5PM M-F?) My actual new sales activity would largely be done 3pm-7pm during the week and all day on Saturday. As I stated above, most of my local 30-45 minute drive are higher income areas.

The second option for me would to be just straight FE. I'd have to drive about an 1-2 hours away from home to do F2F sales presentations. I could adjust my schedule to do field work on Friday, Saturday and do calls in the evenings after 5PM during my work days. The service work would be to make sure people are paying premiums, but otherwise it would be lighter than w/ senior health.

I also did an initial address count for both Med Supp an FE criteria:

For FE if I drive two hours out, there's about 6900 unique households for me to prospect.
For MedSupp, within there's about 12500 within a 45 minute radius.

My criteria for FE was 40K or less, 55-79 in areas that had a median income level of about 30K and that I personally know are the small, factory type towns.

For MedSupp it was 67-77, 75K to about 25k in the higher, more white collar areas.

For me, the majority of my research shows that Senior Health is probably the better market for me now, and in the future for my surrounding market. As above, I'm simply concerned that if the time that I'd be able to have available throughout the day would be sufficient to make sure that my clients would have adequate support. I'd be able to at least touch base with my clients within 2 hours of them contacting me.

I know this is long, if you made it all the way down here.. I appreciate your time and effort.

 

[Travis Price]

*MedSupp additional Info*

I also did a MA penetration search for my MedSupp market. It's approximately 35% on average for the counties that I would work in for my area.

 

[sshafran]

A few initial thoughts - I hear you that you prefer med supps (compared to mapd) due to changing benefits, network restrictions, etc.

Frankly, no one (I.e. your prospects) cares what you prefer. What do they prefer? And it’s not just an income thing, I have high income clients who prefer MAPD. What about prospects who can’t qualify for a med supp? You could walk away, or service them too.

Sure, you can segment your marketing and only target 1. But it’s harder. My opinion, prospect for Medicare-related health, then sell them what they want - regardless of whether it’s Plan G, Plan Hi-F, MAPD, MA-Only, etc.

The hours you are available would be fine. Most people won’t call you for service issues before 10.... they are retired. Not returning their call until mid-afternoon is generally OK. They will just assume you are meeting with others...

—

On a different note... just a thought. Staying with the govt job, just to get taxpayers to pay back the money you borrowed from the bank for college, would it be financially worth it compared to jumping ship and building a $20,000/mo Medicare business? (Which can be built in 7.5 years).

Then, you could pay your own debts. Not us. And make good money doing so.

Just thinking you may not want to trip over a few pennies on the way to some dollars...

 

[LostDollar]

My opinion, prospect for Medicare-related health, then sell them what they want - regardless of whether it’s Plan G, Plan Hi-F, MAPD, MA-Only, etc.

(you left out MSA)

 

[sshafran]

(you left out MSA)

No, I did not. MSAs are MA-Only plans.

 

[sshafran]

No, I did not. MSAs are MA-Only plans.

All MSAs are MA-Only, but not all MA-Only plans are MSAs. MSAs are simply a type of MA-Only.

 

[Travis Price]

Sshafran- thank you for you’re input. However, I would respectfully say a few things:

1) I chose what I sell or don’t based on personal preferences. I have done some research on my area, and I believe that my product mix is the best for my area and myself. I’m willing to refer a customer somewhere else for Med Advantage and lose money. That’s a personal choice. I’m actually considering avoiding AHIP all together and addressing Part D as it comes up without worrying about the money. That could change based on how much I find I’m losing.

2) As for your side note, I appreciate what you’re saying. I actually do pay for my student loans. I had actually ran the numbers on this as well. YOU, the taxpayer, actually don’t lose anything except for the interest on the PSLF for me. I pay my principle. That being said, a lot can happen in 7.5 years that may alter my decision to leave sooner or later from my full time job. It’s a road map.. there are multiple ways to get to the same place. I won’t really speak on the PSLF again as it isn’t super material to the point, but to give context.

Otherwise, thank you for your input. It was really helpful to know what I can expect concerning the service aspect for MedSupps.

 

[sshafran]

Sshafran- thank you for you’re input. However, I would respectfully say a few things:

1) I chose what I sell or don’t based on personal preferences. I have done some research on my area, and I believe that my product mix is the best for my area and myself. I’m willing to refer a customer somewhere else for Med Advantage and lose money. That’s a personal choice. I’m actually considering avoiding AHIP all together and addressing Part D as it comes up without worrying about the money. That could change based on how much I find I’m losing.

2) As for your side note, I appreciate what you’re saying. I actually do pay for my student loans. I had actually ran the numbers on this as well. YOU, the taxpayer, actually don’t lose anything except for the interest on the PSLF for me. I pay my principle. That being said, a lot can happen in 7.5 years that may alter my decision to leave sooner or later from my full time job. It’s a road map.. there are multiple ways to get to the same place. I won’t really speak on the PSLF again as it isn’t super material to the point, but to give context.

Otherwise, thank you for your input. It was really helpful to know what I can expect concerning the service aspect for MedSupps.

Ok, but I’m just telling you, from experience, that your research may be shortsighted.

The data is correct, but the ramifications may be bigger than you are thinking through.

I’d advise you to think through 35% ma-penetration... that does not mean that 35% of your prospects will end up on mapd.

It will be higher.

That means that 35% of people are on mapd... but some choose nothing... some are QMB... some have retiree options...

Where I previosly marketed it was close to 35% penetration. My actual book? Almost exactly 50%.

You also said you are willing to lose out on money and refer it out. I said the exact same thing...

Then you go out and spend thousands of dollars on marketing, get in front of a few people, and give away a portion of sales? Each client is worth about $2,000+ (LTV is debatable, but I think $1700-$2,000 is logical).

Let’s say you find 100 people in the next year who know, like, and trust you (and you paid in time or $ to get in front of), and you refer (or pass over) 35 out of the 100. That’s $70,000.... Year in, and year out...

If you do choose med supp only route, then I’d love to be on the receiving end of the referrals for mapd in MI.

To be clear, not trying to be annoying, just trying to help you be successful (which can partially come by offering mapd in a 35% market).

 

[Travis Price]

Thank you for your perspective. I’m definitely not against revisiting it in the future. You are right, it is about what’s best for the client. I do agree tha MA is a tool in the box.

Ok, but I’m just telling you, from experience, that your research may be shortsighted.

The data is correct, but the ramifications may be bigger than you are thinking through.

I’d advise you to think through 35% ma-penetration... that does not mean that 35% of your prospects will end up on mapd.

It will be higher.

That means that 35% of people are on mapd... but some choose nothing... some are QMB... some have retiree options...

Where I previosly marketed it was close to 35% penetration. My actual book? Almost exactly 50%.

You also said you are willing to lose out on money and refer it out. I said the exact same thing...

Then you go out and spend thousands of dollars on marketing, get in front of a few people, and give away a portion of sales? Each client is worth about $2,000+ (LTV is debatable, but I think $1700-$2,000 is logical).

Let’s say you find 100 people in the next year who know, like, and trust you (and you paid in time or $ to get in front of), and you refer (or pass over) 35 out of the 100. That’s $70,000.... Year in, and year out...

If you do choose med supp only route, then I’d love to be on the receiving end of the referrals for mapd in MI.

To be clear, not trying to be annoying, just trying to help you be successful (which can partially come by offering mapd in a 35% market).

 

[somarco]

I only have Medigap clients, but I still give them what THEY want. Many, especially T65, have questions and don't know which way they want to go.

They have questions. I have answers.

If they still want an MA plan I refer them out.

It's that simple.

Almost all my clients are retired that includes those who are close to turning 65. I generally conduct client/prospect business from 10A to 4P. Rarely take or make calls after 4PM or on weekends. Always make exceptions as needed to accomodate.

Everything done by phone and email. No F2F.

I don't sell ancillary coverage.

Make a pretty good living off Medigap only. And my clients are well served. I rarely lose anyone but a few (less than 5) will drop off each year during AEP when they change to MA. Many want to come back but most can't.

My clients know they can email me any time of day plus weekends and holidays. They can also call but prefer email.

I started my MEDICARE business part-time. My other business was mostly U65 health insurance. Keeping that side alive during the early days of Obamacare (2010) was relatively easy (until 2014) but I had the FLEXIBILITY to work my own hours. It took me 4 years to replace my lost U65 income and during that time my commissions never dropped. I did have a few years of stagnant growth but it never dropped. Once I was able to devote FT to Medicare my income rose considerably. Last year my income was 40% higher than in 2014.

I doubt I could have achieved this if I did not have a background in health insurance.

Working a FT salary job and trying to start a PT commission only job WITH SERVICE WORK sounds great but may not work out the way you envision it.