Medicare Supplements: LIke A High Risk Pool?

[sshafran]

Would love to hear from forum members on the perspective that the Medicare supplement market (vs Medicare Advantage) is similar to a high risk pool, with the eventual problems of many many people on them who are sicker and aging and that they pricing on the existing blocks of business will eventually explode. Somehow, I dont think this opinion is far off as I see my current block of Aetna supplement business price increases becoming ridiculous. I sometimes think I regret NOT selling more MAPD earlier in my career.

Its hard to compete when every other commercial on TV and radio during AEP is pimping all the extra freebies (dental, otc medications, groceries, vision benefits) that every MAPD is now offering. Its to the point of incredibly ridiculous. Im almost to the point that if you can't beat em, join em. I feel like my Medicare supplement biz is a ticking timbomb of explosive rate renewals, regardless of company.

You aren't new to the game, so you know this. One of the most consistent axioms in sales is, "find out what people want - and help them get it."

I chose early on to sell both.

Is Med Supp more comprehensive? Yes.
Is Med Supp more flexible - allowing for almost any provider? Yes.
Is Med Supp more stable - benefits guaranteed for life? Yes.
Does Med Supp preserve their Access to Care in a much better way? Yes.

Do people care? No. Well, some do. But many do not.

Should I sell Med Supp only and endlessly warn them that, by choosing MAPD, they'll pay 20% for chemo, and may not be able to go to their favorite doctor, and sound (to them) like a "sky is falling" desperate agent on the other end of the phone who just wants a commission from the high priced Med Supp plans - only to have them ignore my advice and enroll in a mapd using another agent or carrier directly? (not saying this perception would be true. It wouldn't be. The warnings are legitimate. But, again, their perception is that I just want them to pay a higher price - and they don't care what I want them to do).

All that to say, I'd rather sell both - and then help them find the most reasonable fit if they do choose MAPD over Med Supp after some discussion.

People who buy MAPD often will just "pick one" and make a potentially bad situation worse. By working with them, I'm able to get a full list of doctors, hospitals, and medication - and find a plan option which fits all three major criteria. At this point, I fell like I really did provide them a service, and I also believe that I've helped them gain access to care at least for the current year.

Many of my MAPD clients have been on $0 MAPD for 5+ years with no complaints. They've had no issues with access to care.

People who are prone to purchase MAPD will purchase MAPD no matter how much better Med Supp may be. I may as well earn $482/$241 for doing a comprehensive evaluation for them and helping them choose among the many MAPD options - helping them get the one that will work well for them based on their doctors, their medications, and their preferred hospital systems.

You want no copays? Let me help you get that. You want to pay $0 monthly? Let me help you get that (either way, I'm the one going to get paid).

 

[Alston]

I don't recall seeing that game played at this level before and with such intensity.

They didn't create new companies. But they created new policy series.

They'd sell the ABC policy for 5 years. They they'd sell the DEF policy with virtually the same benefits.

The policyholders in DEF were more recently underwritten so they had fewer claims and paid less.

Eventually ABC only had the people who couldn't pass underwriting for DEF...

and the rates would double.

 

[HealthGuy]

What a great thread, I truly appreciate everyones perspectives and input. I have been selling mainly supplements since 2010. I have only about 10 percent of my seniors on a MAPD currently. Every year I lose about 5 policyholders to MAPD. Thats probably my fault for not calling every client at least once throughout the calendar year. Regardless, if you tell them that you offer MAPD too, still oftentimes they will go with another agent. Its like they take the rate increases on the supplement and by proxy blame you. Conversely speaking, its ironic that when their max annual OOP is raised on their MAPD plan nobody blames the agent.

 

[vic120]

What a great thread, I truly appreciate everyones perspectives and input. I have been selling mainly supplements since 2010. I have only about 10 percent of my seniors on a MAPD currently. Every year I lose about 5 policyholders to MAPD. Thats probably my fault for not calling every client at least once throughout the calendar year. Regardless, if you tell them that you offer MAPD too, still oftentimes they will go with another agent. Its like they take the rate increases on the supplement and by proxy blame you. Conversely speaking, its ironic that when their max annual OOP is raised on their MAPD plan nobody blames the agent.

I write both but lean med supp, I dont lose really much to MA with another agent, I probably lose more MA to another agent then Med Supp, though still a small number.

I do not call every client every year but I have then on send out cards and on email newsletter, they do tend to call me when they are thinking of a change

 

[LostDollar]

Back to the thread title:

Medicare Supplements: LIke A High Risk Pool?

According to articles that pop up in the article section from time to time, approximately half of our Medicare eligible population has a Medigap or Medicare Advantage plan. That would leave approximately half having some other kind(s) of arrangements.

I suspect that over 95% of those folks, whether they have Medigap, Medicare Advantage or something else, are guaranteed to suffer heart failure in the next 40 years. Even with increased longevity, 60-70 years ought to catch everybody. Seems to me like the risks for each of the three "pools" are probably fairly equal.

 

[Alston]

Its like they take the rate increases on the supplement and by proxy blame you.

Shouldn't they if you haven't talked to them in a year and given them a heads up?

Conversely speaking, its ironic that when their max annual OOP is raised on their MAPD plan nobody blames the agent.

They do that too.

Not about the MOOP, but when they have an unexpected surgery or can't see their out of network doctor.

I'm like (in my head) "You really don't remember that I told you about the network restrictions? Do you remember when I asked you who your doctors are and looked them up? Why the heck did you think I did that.?"

I can sell MAPD with a clear conscience. Connecticut is a GI state and we've had a 5 star PDP for the last 4 years. I can move my MAPD clients to a Med Sup any month of the year with no underwriting.

 

[somarco]

when they have an unexpected surgery or can't see their out of network doctor.

I'm like (in my head) "You really don't remember that I told you about the network restrictions? Do you remember when I asked you who your doctors are and looked them up? Why the heck did you think I did that.?"

You GET it!

So many agents think the OM vs MA is about monthly premium or MOOP.

It's not.

It's about ACCESS to providers.

I have thought balloons too. But sometimes I hear the words and think, Did I just say that out loud?

 

[Alston]

You GET it!

So many agents think the OM vs MA is about monthly premium or MOOP.

It's not.

It's about ACCESS to providers.

I have thought balloons too. But sometimes I hear the words and think, Did I just say that out loud?

None of this has been a real problem for 99% of my clients. I check their doctors and drugs every year. (Which is a bigger and bigger chore each year. I can't take many new clients during AEP.)


But since I've focused on T65 and just got started, the vast majority of my clients are still under 70. Most aren't medical frequent flyers yet.

Also Connecticut is like a little Medigap island. Our regs don't allow Med Sup denials or increased premiums based on medical underwriting. Plus, we've had a 5-star plan for the last few years, which means a continuous SEP for everybody.

(A client can have a short waiting period for pre-ex if they don't have current coverage.)

So far I've only had one guy who was hurt because I sold him an MAPD. He had a stroke in another state. The initial hospital stay was covered, but once he stabilized, he had a problem.

His doctor thought he was too weak to travel home. His wife had a tough decision to make.

The rest were

Complainers at birth.


"You sold me the wrong plan. I never had to pay a copay for a doctor visit before."
(But she had 5 visits all year and saved $200 - $300 a month on premiums.)

Didn't understand the policy (sometimes my fault because I rushed through the sale).

"I just had a heart attack and I need you to change my policy." (He was in the hospital two days and didn't know he'd only have $800 in copays. He thought he would pay 10x that much. I love those phone calls. The client is always happy after I re-explain the policy.)

Some can't do math.

Just don't trust me (sometimes my fault because I rushed through the sale).

"I told you I was willing to pay more and now I'm stuck paying $400 a month for my drug." (The drug either isn't on anybody's formulary, or the best PDP has a higher cost share. And I told him about the copay and the donut hole at point of sale.)

The same guy screamed and cursed at me when he was in the hospital with kidney failure. His only concern when he applied was the cost of his drug. I sold him the plan that covered the drug at the lowest price (although he never believed me).

I took more profanity from him than I wanted to. I kept telling myself, "He's terminal. This is a normal reaction. I should help him anyway."

So, I hung in there for awhile and got doormatted.

I never got a chance to tell him that how limited his cost was in the hospital, or that we could move him to a Medigap with the 5-star SEP.

He was too busy trying to correct me about MSP. He thought that since he was disabled he would qualify (regardless of his income) or that only his income counted even though he was married.

I'm not sure who fired whom, but I was glad to see him go.

If I worked in another state, I'd probably make different choices. But I've only had one casualty so far.

 

[somarco]

Didn't understand the policy (sometimes my fault because I rushed through the sale).

I don't buy that. You are so thorough. Can't imagine you leaving the conversation until you know they understand everything you have told them.

 

[sshafran]

It's about ACCESS to providers.

I see that as a factor, but not the factor.

And I think many prospects feel the same way. Access is not the only thing driving their decision.

Case in point: just today, I had a prospect sign up for an MAPD with me. She didn't want to pay for Plan N.

I checked 5 mapd, all of them had something wrong (either a high copay on Rx, or 1 of her 3 docs not in network.)

Her choice? Lowest medication cost and she dropped one doc. She chose medication cost over access to her specialist.

Not saying she made the right or wrong choice, but I am saying, she made the choice. I presented 87 Plan N plus the best PDP in addition to the mapd options...