As co-owner of an agency that specializes in Medicare products, I'm often asked by industry colleagues whether we have "made the switch" to selling Medicare Advantage products. Certainly Medicare Advantage plans have become popular among seniors in recent years due to their low premiums and built-in drug cards. But we still find the Medigap market to be a thriving one, with nearly 70 percent of our client base opting for these traditional and comprehensive plans.
The obvious next question, then, is: How do we sell against Medicare Advantage plans, which are so much cheaper? The answer is that we don't sell against anything. We educate and then let our clients decide.
Perhaps one of the best things about working the senior health insurance market is your role as an educator. We explain to prospective clients that for most beneficiaries there are two primary coverage choices: Medicare Supplements or Medicare Advantage plans. Then we outline the benefits of each type of insurance and let them decide.
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The fact that the lion's share of our clients opt for the more traditional and significantly more expensive Medigap plans goes to show that not all beneficiaries make their decisions based on price. There are certain groups of clients for whom a traditional Medigap plan makes a lot of sense, and these folks would greatly appreciate it if you wouldn't just talk at them about zero-dollar premiums.
If you'd like to grow your Medigap policyholders, here are a few tips to help you become a Medicare Supplement Superstar.
1. Find the natural fit
There are certain groups of clients who are naturally inclined toward Medigap plans. These include snowbirds or frequent travelers who intend to make some tracks around the nation during their retirement. Sticking with original Medicare and a supplement allows these folks to access any Medicare provider in the nation, whether they're vacationing in Florida or taking the grandkids ice-skating in Michigan.
While Medicare Advantage plans have out-of-area benefits for emergencies and urgent care, some people have doctors in both locations and want to access familiar health care providers regardless of which state they happen to be in at the time.
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Individuals with chronic health conditions are sometimes good candidates, too. There are times when the numbers just make sense.
A client was referred to me whose Medicare Advantage plan was leaving the county, thus creating a special election period for her to choose either another Medicare Advantage plan or get a guaranteed issue window into a Medigap plan. She suffers from rheumatoid arthritis, and her treatment regimen included a monthly injection in her doctor's office. Unfortunately this shot, which helped control her symptoms, had a retail price of $2,000, and her share under her Medicare Advantage plan was $400.
She had been skipping the injections regularly due to the cost. We moved her to a Plan F with a premium of around $160 per month, and her injection was covered in full, saving her thousands per year and ensuring she could get her injections regularly. She was a natural candidate for a Medicare supplement.
Retiring business owners are also good prospects. A person who has had a rich benefits plan in place for many years will often enjoy the flexibility of Medigap plans, which have no network restrictions and require no referrals to see specialists. If your client mentions that he is coming off a company plan with a $300 deductible and low prescription copays, or has been paying an outrageous small group premium in order to maintain a low-deductible health plan, chances are that he is quite open to the concept of paying a higher premium for robust coverage.
Talking with your clients about their lifestyle and health care needs is the simplest way to spot good Medigap candidates. Explain the benefits and costs for both kinds of plans, and you'll be surprised at how many will opt for a traditional Medicare supplement despite the cost.
