Medicare's New Rules
- Thread starter midwestbroker
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Most of you also know that I feel the same, especially about the PFFS Plans.
Agents are not going to "stand up and quit being taken advantage of", you know that as well as I do. The vast majority of them will bend over, spread their cheeks and take whatever the companies decide to stick them with.
It gets worse every year yet agents still keep bending over. The individual, independent agent will remain pretty much helpless unless we get together and make a stand. (That ain't gonna happen!)
It will take the very large general agents and the marketing companies all working in unison to initiate any kind of change. They get their blood money from people like you and me now and they laugh all the way to the bank.
They don't do jack-**** for their money, why would they want anything changed? They could care less about whether or not we are being treated fairly.
Next time I grow up...
A
allhealthandlife
Guest
First year commission cannot exceed 200% of annual renewal so based of a $ 400 commish spread out over 6 years the first year commish cannot exceed $ 133.33 ( 400 over 6 years is 66.66 per year)Thanks Midwest!
WEIRD STUFF!!!
After the 2009 baseline year, no entity may provide, and no agent or broker may receive, compensation greater than the renewal compensation payable by the replacing plan on renewal policies if an existing policy is replaced with a like plan type during the first year and 5 renewal years. "Like plan type" refers to PDP, MA or MA-PD, or Cost plan. Examples of replacements with like plan type are—PDP replace with another PDP, MA or MA-PD replaced with another MA or MA-PD, and cost plan replaced with another cost plan. If a PDP is added to an MA-only plan, then a new commission is paid for enrollment in the PDP.
Agent/Broker Compensation
Effective date: September 18, 2008 MIPPA required that we establish limits on
agent and broker compensation that ensure that agents and brokers enroll
individuals in the Medicare Advantage plan or Medicare Prescription Drug plan
that is intended to best meet their health care needs.
These compensation rules are designed to eliminate inappropriate moves of
beneficiaries from plan-to-plan. CMS expects that plans will set compensation at
levels that are reasonable, and reflect fair market value for services
performed. CMS encourages plans to keep compensation as level as possible across
plan types, and among agents providing similar services.
If Medicare plans compensate their brokers and agents, under our regulations
implementing MIPPA, they must pay compensation for the initial year and each of
five subsequent renewal years (creating a six-year compensation cycle), provided
the member remains enrolled with the MAO or PDP.
The first year of this cycle, for purposes of determining the compensation paid
to an agent, is 2009 - provided that the beneficiary makes an enrollment change
effective in 2009. The next move of this beneficiary after 2009 would be paid as
a renewal commission. For beneficiaries who do not make an enrollment change in
2009, the first year of the six-year compensation cycle would start the year the
beneficiary makes his or her first enrollment change after 2009.
An agent's aggregate first year compensation can not exceed 200 percent of the
aggregate compensation in each individual subsequent renewal year, of which
there must be a total of five renewal years. (This creates a six-year cycle.)
This means that in the first year, the compensation paid can be no more than 200
percent of the compensation paid in the second year or any individual subsequent
renewal year up to a total of five renewal years (six year total compensation
cycle). The agent will receive renewal compensation for the five year renewal
period (years two through six) as long as the member remains enrolled in the
plan or enrolled by the agent in a like replacement plan.
Compensation is earned in months 4 through 12 of the enrollment year as long as
the member is active with the plan. If an enrollee leaves the plan prior to
month 4, no compensation is earned. If an enrollee leaves the plan after month
3, compensation is paid on a pro-rated basis for the months in which the
enrollee actually was a member of the plan.
After the 2009 baseline year, no entity may provide, and no agent or broker may
receive, compensation greater than the renewal compensation payable by the
replacing plan on renewal policies if an existing policy is replaced with a like
plan type during the first year and 5 renewal years. "Like plan type" refers to
PDP, MA or MA-PD, or Cost plan. Examples of replacements with like plan type
are—PDP replace with another PDP, MA or MA-PD replaced with another MA or MA-PD,
and cost plan replaced with another cost plan. If a PDP is added to an MA-only
plan, then a new commission is paid for enrollment in the PDP.
Plans must establish a compensation structure for new and replacement
enrollments and renewals effective in a given plan year. Plans may not alter the
compensation structure during the given plan year. Compensation structures must
be in place by the beginning of the plan year marketing period, October 1, and
must be available upon CMS request including for audits, investigations, and to
resolve complaints.
Agent/Broker Compensation
Effective date: September 18, 2008 MIPPA required that we establish limits on
agent and broker compensation that ensure that agents and brokers enroll
individuals in the Medicare Advantage plan or Medicare Prescription Drug plan
that is intended to best meet their health care needs.
These compensation rules are designed to eliminate inappropriate moves of
beneficiaries from plan-to-plan. CMS expects that plans will set compensation at
levels that are reasonable, and reflect fair market value for services
performed. CMS encourages plans to keep compensation as level as possible across
plan types, and among agents providing similar services.
If Medicare plans compensate their brokers and agents, under our regulations
implementing MIPPA, they must pay compensation for the initial year and each of
five subsequent renewal years (creating a six-year compensation cycle), provided
the member remains enrolled with the MAO or PDP.
The first year of this cycle, for purposes of determining the compensation paid
to an agent, is 2009 - provided that the beneficiary makes an enrollment change
effective in 2009. The next move of this beneficiary after 2009 would be paid as
a renewal commission. For beneficiaries who do not make an enrollment change in
2009, the first year of the six-year compensation cycle would start the year the
beneficiary makes his or her first enrollment change after 2009.
An agent's aggregate first year compensation can not exceed 200 percent of the
aggregate compensation in each individual subsequent renewal year, of which
there must be a total of five renewal years. (This creates a six-year cycle.)
This means that in the first year, the compensation paid can be no more than 200
percent of the compensation paid in the second year or any individual subsequent
renewal year up to a total of five renewal years (six year total compensation
cycle). The agent will receive renewal compensation for the five year renewal
period (years two through six) as long as the member remains enrolled in the
plan or enrolled by the agent in a like replacement plan.
Compensation is earned in months 4 through 12 of the enrollment year as long as
the member is active with the plan. If an enrollee leaves the plan prior to
month 4, no compensation is earned. If an enrollee leaves the plan after month
3, compensation is paid on a pro-rated basis for the months in which the
enrollee actually was a member of the plan.
After the 2009 baseline year, no entity may provide, and no agent or broker may
receive, compensation greater than the renewal compensation payable by the
replacing plan on renewal policies if an existing policy is replaced with a like
plan type during the first year and 5 renewal years. "Like plan type" refers to
PDP, MA or MA-PD, or Cost plan. Examples of replacements with like plan type
are—PDP replace with another PDP, MA or MA-PD replaced with another MA or MA-PD,
and cost plan replaced with another cost plan. If a PDP is added to an MA-only
plan, then a new commission is paid for enrollment in the PDP. Agent/Broker
Compensation
Effective date: September 18, 2008 MIPPA required that we establish limits on
agent and broker compensation that ensure that agents and brokers enroll
individuals in the Medicare Advantage plan or Medicare Prescription Drug plan
that is intended to best meet their health care needs.
These compensation rules are designed to eliminate inappropriate moves of
beneficiaries from plan-to-plan. CMS expects that plans will set compensation at
levels that are reasonable, and reflect fair market value for services
performed. CMS encourages plans to keep compensation as level as possible across
plan types, and among agents providing similar services.
If Medicare plans compensate their brokers and agents, under our regulations
implementing MIPPA, they must pay compensation for the initial year and each of
five subsequent renewal years (creating a six-year compensation cycle), provided
the member remains enrolled with the MAO or PDP.
The first year of this cycle, for purposes of determining the compensation paid
to an agent, is 2009 - provided that the beneficiary makes an enrollment change
effective in 2009. The next move of this beneficiary after 2009 would be paid as
a renewal commission. For beneficiaries who do not make an enrollment change in
2009, the first year of the six-year compensation cycle would start the year the
beneficiary makes his or her first enrollment change after 2009.
An agent's aggregate first year compensation can not exceed 200 percent of the
aggregate compensation in each individual subsequent renewal year, of which
there must be a total of five renewal years. (This creates a six-year cycle.)
This means that in the first year, the compensation paid can be no more than 200
percent of the compensation paid in the second year or any individual subsequent
renewal year up to a total of five renewal years (six year total compensation
cycle). The agent will receive renewal compensation for the five year renewal
period (years two through six) as long as the member remains enrolled in the
plan or enrolled by the agent in a like replacement plan.
This will kill MA / PDP indi sales in 2010! For 2010, CMS will start tracking agent of records and will then provide carriers the necessary info to make sure renewals are paid. Agents whom service their clients and advise a more suitable carrier will get paid much less for their efforts. The carrier that is replacing will then pay renewals (max 6 years total!).
Pyramid home office people are popping corks now! Whether your 100% MedSupp or anti MA -- this stupid anti consumer 6 year drop-off commissions rule will leave alot of consumers without an advisor.
Good news for the carriers and home office captive agents. (i.e. Humana)
Bad news for the client + 6 years out!
Two things:
1) PDPs don't pay squat. It is a piece of cake for people to sign up at their local pharmacy online, and they can change plans every year if they like.
2) Commission on MAs "as earned" is not a bad idea. As a matter of fact, I opt for that with my Med Sup carriers. Advanced commissions are great for sales encouragement, especially to new agents, and are the 'de rigueur' for MAs. The fly in that ointment is that agents out for the quick buck may not follow up that client with needed service, hence the complaints that are greasing the skids on this option to be eliminated.
A
allhealthandlife
Guest
Really, how much customer service does a Med Supp client need ? I have several hundred Med Supp clints and I NEVER get a customer service call it is a seemless no brainer product for seasoned citizens so i am happy with as earned commish on these. In fact customers think you are the best agent in the world for enrolling them in a Med Supp because " it pays so good "
MA on the other hand is a high maintenance beeaaacth. I cringe every time i get a customer call. We as agents have been delegated to be the DE facto customer service for these plans. If the customer has a routine question or need then customer service can usually deal with it but heaven forbid if its something out of the ordinary customer service reps are known to become ignorant, lazy or rude. Then we as agents get calls to handle something we really can't or are not suppose to handle.
This is why MA agents should receive more compensation ( much more)for MA compared to Med Supps
My experience, also.
I agree with you... most of my MA clients are entitlement addicts, especially those that are dual eligibles. They want the government to pay for everything, whether they have contributed much or not.
Tax the rich! give to the poor! Robin Hood, where are you?
What you say is right on! Just yesterday it took me almost 2 hours to help a client get their diabetic testing strips paid for by the company. It took 2 calls to the company, 3 to the pharmacy and 3 calls to the client to get things straightened out.
CMS offices are terrible to deal with, I had to call the Dallas office 6 times over a month and a half and be extremely nice to the people there to get a client back on a plan that I had enrolled her on. Some agent came in behind me and told her that she could see any Dr. on his plan when it was an HMO. I got her Rx fixed right away but have had to go back and forth with CMS and the company to get it fixed. Both said the other was at fault. The lady at CMS one time she hated to deal with these problems and I had to repeat what needed to be done and then double check to make sure she understood what she need to do. The whole time we talked you could tell by her tone that I was putting her out.
The amount of work and time that I miss with my family during the AEP is crazy. All the rules we deal with which does keep the bad agents out make it very difficult for the one that are doing the right thing to do business.
On what Frank says about agents revolting, I have written to my congressman and senator the last 2 years and have gotten on decent response. One senator just sent me form letter that to me she has no clue. I am going to write again and maybe try and talk to them in person after the election.
Another note about switching is that we have one PPO plan in this area and in 2011 when PFFS goes to the wayside, there won't be many agents left to help seniors make the right choices.
I guess this all needs to be clarified, and who ever wins the election may change it all again....
Non-golfing Agent
Expert
- 76
I've talked to a few FMO's and they are under the assumption that renewals will be bumped from $200-$300 a year...so $400-$600 for first year commish.
And since there is no mention of a cap on renewals in the new rules...
The more things change, the more they stay the same.
And since there is no mention of a cap on renewals in the new rules...
The more things change, the more they stay the same.
A
allhealthandlife
Guest
That's all good except:
1. FMOs have been known to lie , cheat and steal to get you to sign a contract.
2. One of the main objective of the new compensation rules was to flatten the commish difference between what is paid for MA and PDP to discourage bad behavior. Are they going to pay us a thousand bucks to enroll someone in a PDP ?
3. The carriers not CMS will track the six year cycle because they want to be compliant and because it is their money !
1. FMOs have been known to lie , cheat and steal to get you to sign a contract.
2. One of the main objective of the new compensation rules was to flatten the commish difference between what is paid for MA and PDP to discourage bad behavior. Are they going to pay us a thousand bucks to enroll someone in a PDP ?
3. The carriers not CMS will track the six year cycle because they want to be compliant and because it is their money !
Non-golfing Agent
Expert
- 76
1. Yes, but their livelihood depends on their agents being compensated. They'll get killed if the commissions are bumped down to $150-200
2. Yet this objective wasn't made law.
3. If renewals are $15-$25 a month and the plan stays competitive then my concern for the six year cycle is moot.
Renewals will go up or a few of these companies will be out of business. There will be at least one company who bumps the renewals up to a fair number, and that will be the company that gets my business.
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