Minnesota As a Case Study?

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Minnesota is basically it's own little world when it comes to health insurance, we bascially have five carriers:

BC/BS of MN (about 80% of the IFP market)
Medica (UHC's arm, they do all the administration)
Health Partners
Preferred One (not nearly as much of a player as the Big 3)
Assurant (more or less a non player)

The only carrier I'm aware of changing commission in 2011 is Assurant. I was curious if MN has a mandated loss ratio, and they do (and have had it for a while):

Small Group - 82%
Individual - 72%
*Loss Ratio defined as incurred claims / total premiums (broker commissions not included)

That got me thinking, what loss ratio does BC/BS have currently, I was suprised at the results:

2009
Incurred Claime = 90.2%
Admin Expenses = 7.6%
Broker Fees, Assessments, & Surcharges = 1.8%

I calculated the incurred claims percentage back to 2005 and for all years, the loss ratio was right around 90%. That got me thinking, how big of deal is the MLR ruling? Plenty of health insurance brokers make a very good living in my state, how important is MLR? It seems to me the exchanges are the real threat, not MLR.

The real differences here:
1. No advances.
2. With most carriers, it's a flat fee per app:
$400 per family (2 or more people)
$180 single
$19 PEPM for small group (under 50 EE's)

That may seem low to the rest of you, but like I said, plenty of agents make a good living selling health insurance in my state.

The exchanges are the threat, not MLR if you have a long term focus on this business!
 
I know a guy in MN - not a joke- that made well over 400K this year selling 80% major medical, 20% of his income (about life insurance). IT CAN BE DONE despite the Obamination. Granted this guy has been in the business 25 years and he works all the time, but yes Matt is right, it is possible to survive this clusterf@#k. So with the exchange then, can we make six figures with 80% health revenue, 20% life...Maybe, maybe not...80K selling health alone, plus 20K in life insurance gravy - who knows anymore! Oh by the way, Pelosi and Obama don't think that 400K is his anyway, so they confiscate over 50% of it in combined taxes....Even though this guy works his ass off insuring people, I guess his earnings are not his. He is an evil wage earner.
 
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In Iowa the insurance commissioner, representatives from NAIFA and NAHU, the local BCBS. and a few political types are evaluating how the exchange with operative here. Their first step was to set up a non-profit with the intent of using it to operate the exchange. We'll be waiting to see how it turns out but at least the Iowa DOI is working with the agent community to help ensure they have a key role--paid role--in the exchange.
 
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I know a guy in MN - not a joke- that made well over 400K this year selling 80% major medical, 20% of his income (about life insurance). IT CAN BE DONE despite the Obamination. Granted this guy has been in the business 25 years and he works all the time, but yes Matt is right, it is possible to survive this clusterf@#k. So with the exchange then, can we make six figures with 80% health revenue, 20% life...Maybe, maybe not...80K selling health alone, plus 20K in life insurance gravy - who knows anymore! Oh by the way, Pelosi and Obama don't think that 400K is his anyway, so they confiscate over 50% of it in combined taxes....Even though this guy works his ass off insuring people, I guess his earnings are not his. He is an evil wage earner.

Chad, it can be done.

It takes money, a hard work ethic, lot's of 5 hr energy, and no more posting on this forum.
 
Thanks Mark, will take your word for it but I may not stop posting here anytime soon! Having too much fun.
 

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