New MA App Vs. Renewal

[jdeasy]

"capitulation rate"? Yeah! That's what I was thinkin'... just capitulate to the demands of CMS. They're not losing any money.....

(I know you meant "capitation rate".... prolly a Freudian slip)

Yeah!

 

[Joe Moore]

WOW what a cluster CMS has made of things is GW personally handling this matter. LOL

This may be part of "Mission Accomplished"!
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I mentioned this earlier. This is a very good point to consider. Why focus on agents (one piece of the equation) to the exclusion of the whole. CMS pretends to be looking out for the beneficiaries, protecting them from rogue agents, but their actions are akin to using a hammer to fix a watch. (Not that there is a similarity of Medicare to a watch!!)

The other point I want to make is that I think it is unethical for them to change contractual rules in the middle of a contract period. Not only that, but to not make a final decision until the end of the AEP is downright disgusting. This runs counter to business standards, and not only is reprehensible, but questionable legally. I intend to seek legal counsel about what I can do about this. I know trying to file lawsuits against government agencies is futile, but I am going to name names.

This newest ruling MAY actually help us with our earnings on agent overrides, but this is money we should actually never have, it should go to the agent. The way I have read the rules, I am not sure there is a legal way to funnel our overrides to someone on the agent level. I have no clue whether companies will keep the reduction, or leave it in upline hands. Either way, it is not right.

If it is left with the upline, one way to make it work would be for everyone contracted to be a GA. But there may be some new ruling to prohibit this.

Retread, I fully agree, everyone thought they knew what they were making and now they are getting an unwelcome haircut.
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From everything I have read, these commission restrictions only apply to the writing agent. The companies, the FMO's and the GA's all get the same money they got before, {or more}, whether or not it's a churning or a new app.

There has been no information that would show the capitulation rate to be any less than ever. In fact, evidence tends to show that it is higher.

Writing agents have been made the patsies and bear the brunt of these regulations. CMS is the bad guy, but, they have been in collusion with the companies, especially the captives, on this. Humana was outed right here on this board as being a party to stuff.

JD, you are right, the writing agent seems to be the target.

 

[midwestbroker]

IMHO:

Medicare is trying to weed out the true independent agent. The ones who contract direct and have no up-line. These are the "rouge" agents in Medicare' eyes that they have no control over.

If an agent as mentioned above is out there doing things wrong, they are harder to catch. If and when they are caught, they are the only ones, there is no "up-line" to take down with them.

CMS wants to catch the bad apples, but rather then go after the singe apple, they would rather cut the whole tree down from where that apple came from.

I am beginning to take notice that there are carriers who are starting to bulk up their captive sales force.

 

[GreenSky]

As I understand it (at least moving forward), replacing an MA will generate a renewal commission no higher than that from the replaced company. I'm not sure how this affects our 2009 effectives.

So, if Aetna is paying $100 renewal on business written in 2007 and I move them to Secure Horizons in 2010, I only get the same $100. I guess CMS wants us to stop even servicing our existing clients.

Maybe by then CMS will eliminate commissions altogether.

Rick

 

[Josh]

As I understand it (at least moving forward), replacing an MA will generate a renewal commission no higher than that from the replaced company. I'm not sure how this affects our 2009 effectives.

So, if Aetna is paying $100 renewal on business written in 2007 and I move them to Secure Horizons in 2010, I only get the same $100. I guess CMS wants us to stop even servicing our existing clients.

Maybe by then CMS will eliminate commissions altogether.

Rick

According to the plans I've been working with, and what I believe the actual language of MIPPA, you would receive no higher than the renewal commission for the plan the beneficiary goes on. So if they were with Aetna and you move them to UHC, you would get paid the UHC renewal commission. So if an agent has a $400/$200 contract with Aetna and moves a client from any other plan to Aetna, the most they'd get is the $200.

With respect to the elimination of commissions, that is extremely unlikely. Even in the language of the new law it states that a commission has to be paid.
"Compensation.-... Such guidelines shall ensure that the use of compensation creates incentives for agents and brokers to enroll individuals in the Medicare Advantage plan that is intended to best meet their health care needs."
It's much more likely that CMS wants Medicare Advantage agents to work like property and casualty guys who can revisit their insured coverage each year and keep the same clients with a level commission. This new commission structure is more like getting a yearly raise every time you get a client.

If anyone hasn't read through the MIPPA it would probably be a good way to invest some time, it's really helpful.

 

[MedSuppPro]

With respect to the elimination of commissions, that is extremely unlikely. Even in the language of the new law it states that a commission has to be paid.
"Compensation.-... Such guidelines shall ensure that the use of compensation creates incentives for agents and brokers to enroll individuals in the Medicare Advantage plan that is intended to best meet their health care needs."
It's much more likely that CMS wants Medicare Advantage agents to work like property and casualty guys who can revisit their insured coverage each year and keep the same clients with a level commission. This new commission structure is more like getting a yearly raise every time you get a client.

If anyone hasn't read through the MIPPA it would probably be a good way to invest some time, it's really helpful.

OK and when our renewals go away after 5 years due to CMS's interpretation of MIPPA, then GreenSky's dry humor is spot on!

My P&C agent has had and will have more than 5 years of renewals per Medicare number! No government intervention. P&C agent compensation is a poor example... Come to think of it, there is no comparable example in the insurance industry. But, then again, PART C and PART D is not insurance -- is it?

How is the consumer helped by a five year term-limit of the client-agent relationship?

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[midwestbroker]

Please watch the use of large fonts.

So, I get 5 years. Well, I am constantly adding to my book of business each year. I am also cross selling other products with my book of business.

Plus, in 3 years, who knows what the market will look like.

Solution: Sell them med supps to start off, then look at MA plans later. Then your 5 years got extended by the addition years they are on the supplement.

Or, you could just go sell something else. Car dealers are always looking for sales people.

You can complain all you want, but what good is that going to do? Make it work or move to the side.

 

[MedSuppPro]

Please watch the use of large fonts.

Solution: Sell them med supps to start off, then look at MA plans later. Then your 5 years got extended by the addition years they are on the supplement.

Or, you could just go sell something else. Car dealers are always looking for sales people.

You can complain all you want, but what good is that going to do? Make it work or move to the side.

I have MedSupp's that ask health questions. The Show Me State has some kinda annual Open Enrollment. You can do it!

For my clients whom are stuck on the MA band wagon they are screwed. And OK the 5 year and your out doesn't bother you! Your always posting the same thing... Warm and fuzzy HMO Coventry la la land! So if you don't care, then why bother responding?

Yah, maybe I could sell my clients a used car. Wise cracker!