You Tell 'em in CT, Mary Jennings!

[Ann H]

You are a baseball player at the end of his playing career. He get an offer for 3 or 4 times his last contract... the new offer is for 3 years with a team option for a 4th.... Do you sign the contract? Do you decline the offer and go out and do something else? Did you decline the offer and then get bitter and mad because all your friends are still playing and hitting home runs, even making the all star game? It's your call....

Think about that for a bit and you will see and understand exactly whats going on with agents and the market

Excellent post from TaterPeeler.

So, see, it's about your own skill sets and risk taking tolerance, plus the type of rewards that you expect from your decision. You just heard from an All Star player that decided to take the offer. But it's not like he is surprised that it's a short-term windfall. He is fully aware of the rise and impending fall. He predicted it, for heaven's sake, right here on this forum. And then took the offer to play fastball.

And then there are others, who view it differently (still a valid viewpoint). They see opportunity to make 3 or 4 times their last contract also. In a different segment, perhaps over time, with less stress during an OEP, and with solid or high income that lasts for 20 years. Also a valid viewpoint.

Here's my point. There are lots of personalities, and lots of opportunities. If you know your own skill sets and your own opportunities, you can decide what you have the risk tolerance for, and what kind of rewards you want to reap. Neither of the decisions are invalid. And neither of the parties is surprised that the smorgasbord was overrun with hungry people, running up costs.

 

[FLM2]

Tater and Ann have this 100% correct, if anyone thinks that experienced, business-savvy agents kept plugging away at IFP with no backup plan they are absolutely wrong.

Like many others, I had a huge income spike in 2014 (up 75% from 2013) followed by reductions of 40% in 2015 and another 25% in 2016. I expect a 30-40% drop for 2017 but the income is still enough to justify the two months of hard work I put into this annually.

I've gone back and forth with this many times but, at the end of the day, I'm not going to walk away from the remaining income or my clients until commissions have been completely eliminated.

Many of us take this one year at a time-at this point in time, there are enough companies planning on paying commissions in Florida and my other states to keep supporting this business segment while continuing to build my alternate revenue stream (Medicare, which I started in 2012).

 

[Ann H]

I do mostly group insurance, with a side of ACA IFP. But I still analyzed my strengths, weaknesses, opportunities and threats in the ACA IFP market and took the opportunity, despite the obvious threat that it was short-term.

And now I will go forward with Group Insurance commission, and 0% on any IFP plan I decide to do for my client.

The rewards were worth the risk to me. Of course I have high risk tolerance plus assets to make it through the hard times. Not everyone does, nor wants to. I'm good with that.

 

[scagnt83]

I do mostly group insurance, with a side of ACA IFP. But I still analyzed my strengths, weaknesses, opportunities and threats in the ACA IFP market and took the opportunity, despite the obvious threat that it was short-term.

And now I will go forward with Group Insurance commission, and 0% on any IFP plan I decide to do for my client.

The rewards were worth the risk to me. Of course I have high risk tolerance plus assets to make it through the hard times. Not everyone does, nor wants to. I'm good with that.

I havent sold IFP in over 5 years now and did little of it even back then. But I am still active in the small group market.

If Hill Dog gets elected our Group business might be at risk... she keeps leaning towards the universal gooberment option.

Even Trump has talked about it to an extent under a dual system. That would at least not be an immediate death blow for the market I work, but it would create a slippery slope that could eat away at the current system. (not like that isnt already happening to an extent via Obamacare, but its mainly just been comp and plan design so far)

 

[Ann H]

Yes, you are right. Group insurance, particularly small group, could crash with the stroke of a President's pen. Just changing the tax-deductibility of health insurance for group vs IFP could cause a major swing for small groups.

After 36 years in this business, I look at health insurance as a never-ending cycle. Indemnity, HMO, PPO, EPO, HIPAA, ACA... There are so many more - PSF, MEC, STM, FI, CI, then maybe Single Payer + Supplement, or back to U/W and High Risk Pool. All of those alphabets will rise and then fall. If you don't like roller coasters, you might not want to be a health insurance agent!

On a contrary point, I think politicians might get slaughtered by destroying the employer market at this point. That is the place of safety for folks wanting to be protected from the ACA IFP market.

So, I absolutely agree with you, Scagnt83. Group for now is great, but vulnerable.

 

[ARus]

Scagnt83, that was a great explanation of robo-advisors.

NYLife11023, there are 2 sides to the story. Many agents got out early and made a wise choice. Other agents stayed in to reap a short-term windfall, and they also made a wise choice.

It just depends on your own skill sets and risk taking tolerance, plus the type of rewards that you expect from your decision.

But this was not a surprise to any experienced agent, whether they chose to stay in for the rise and fall, or leave early to build their Plan B. Not a surprise at all. It was predicted by probably 90% of experienced agents, plus a lot of economists, politicians, lawyers, CPAs, business owners, and regular family folk. A lot of regular family folks had enough common sense to know that you couldn't run a free for all smorgasborg and expect that hungry people wouldn't gorge on the lobster and prime rib.

So there are many agents that stayed for the short-term windfall, knowing it was short term. Others built their Plan B quickly, knowing a fall in ACA was coming.

When agents discuss this fall, the motivation is more than, "Oh, I lost commission!" This is a major hit to America, especially the middle class. In our state (Arizona), 3 carriers are left with rate increases like 86% and 122%. The 3rd carrier is at 19% (unless they pull out), and we know what claims loss ratio they will be hit with, which is another major concern. Doctors are closing practices and/or merging with the big hospital systems. Insurance companies are selling to bigger companies, reducing competition, which affects ACA policies but also Medicare, Group Health, and other products. This is not good news, all the way around. Predicted or not, it's a topic of discussion for agents who still provide for their clients in the health insurance segment.

Agree and Disagree! The old system can't come back. I don't see it working anymore? Do you?

 

[somarco]

Horse is out of the barn and run off. Old style IFP will never return. Even the current form can't last too much longer unless more carriers get out of the business leaving just BX to write coverage direct, no agent.

My money is on scrapping hc.gov and the current subsidy and replacing with a Medicaid buy-in. Doesn't matter who lives at 1600 Pennsylvania. IFP is toast by 2018

 

[ARus]

My opinion, Obama Care will stay, will change until become a well polished system for taxing and decent health care, with or without commissions for us. The only people, who were right about it, were people who said that it is a new form of taxation. Their opinion was the closest to what happened and is going on. It needs time the economical result to gain advantage. We will be alive to see.

 

[Ann H]

Agree and Disagree! The old system can't come back. I don't see it working anymore? Do you?

Yeah, the old system could come back. In fact, it will come back. "When?" is the proper question.

Here's a scenario, which could be vary in a dozen different orders.

IFP... High Rates... ACA... Spiking Rates... Uninsured middle class... Adverse selection... Short-term fix... Revised ACA... Crisis again... Nobody gets a tax/penalty... Adverse selection... Revised ACA again... Crisis again... Loopholes to the law emerge... Adverse selection... Consumers have more skin in the game... Doctors & Providers try to solve the problem... Costs become more transparent... Networks are dead because all Dr.'s and providers charge about the same thing now... Underwriting is allowed again... High Risk Pool for the uninsurable...

Re-do that scenario in a score of different orders. Add your own solutions, in any order. It all comes out to one thing. Yesterday comes back.

If you don't think that's true, then you haven't been in health insurance long enough.

In fact, it doesn't have to go through the torturous demise that I just described. Yes. As a next step, they could bring back underwritten plans, plus high risk pool, plus expand Medicaid to 250%, and it's a done deal. For a while. Then it morphs into something else.

National Single Payer won't solve anything until underlying issues are solved, either. Medicare has supplements. Canadians have supplements to their national healthcare. Canadians come here for treatment and buy US insurance to do it. National Healthcare across the globe has morphed into reduced benefit plans or rationing to absorb costs.

National Single Payer is just one step on the hamster wheel. But it never stays there. It just morphs into something else. It will continue to do that until we fix root causes and stop trying to hide the coin under the shell and keep moving shells around. Shells disguise costs. Cost reduction takes honesty.

 

[ARus]

Yeah, the old system could come back. In fact, it will come back. "When?" is the proper question.

Here's a scenario, which could be vary in a dozen different orders.

IFP... High Rates... ACA... Spiking Rates... Uninsured middle class... Adverse selection... Short-term fix... Revised ACA... Crisis again... Nobody gets a tax/penalty... Adverse selection... Revised ACA again... Crisis again... Loopholes to the law emerge... Adverse selection... Consumers have more skin in the game... Doctors & Providers try to solve the problem... Costs become more transparent... Networks are dead because all Dr.'s and providers charge about the same thing now... Underwriting is allowed again... High Risk Pool for the uninsurable...

Re-do that scenario in a score of different orders. Add your own solutions, in any order. It all comes out to one thing. Yesterday comes back.

If you don't think that's true, then you haven't been in health insurance long enough.

In fact, it doesn't have to go through the torturous demise that I just described. Yes. As a next step, they could bring back underwritten plans, plus high risk pool, plus expand Medicaid to 250%, and it's a done deal. For a while. Then it morphs into something else.

National Single Payer won't solve anything until underlying issues are solved, either. Medicare has supplements. Canadians have supplements to their national healthcare. Canadians come here for treatment and buy US insurance to do it. National Healthcare across the globe has morphed into reduced benefit plans or rationing to absorb costs.

National Single Payer is just one step on the hamster wheel. But it never stays there. It just morphs into something else. It will continue to do that until we fix root causes and stop trying to hide the coin under the shell and keep moving shells around. Shells disguise costs. Cost reduction takes honesty.

I like that most of us here we want health coverage to be accessible, but you opened the word about root causes. Unfortunately I don't see them removed. They are built into the nature of this country, which makes it different. Here always will be a fight > results>new fight and fighters > new results. It is built in with the power of President and him coming with all surrounding landscape. I can't say it is bad. It is unique and for sure for all big issues like healthcare access is crucial. I don't like a National Single Payer system as well. It has its big disadvantages. One huge HMO with restrictions for network. Just is less harmfull for all people. For us. And you are right, that nothing stays same, even when working perfectly. There always will be kind of destructing forces.

The large insurers are actively approaching the international markets, because they see, that they are becoming and will be administering insurance here wth 20% piece from the pie. All of them started offering international medical and there is an additional reason for it: people move following their jobs, no countries' borders, or they spend few months here, few months abroad. All kind of reasons. I am working on this market and just before 5 years it was difficult to find a good global medical product. See now: all companies from our national market are there through subsidiaries. We live in a time of CHANGE. So, who will pay us further??? is the big question.