Can You Sell Medicare Advantage Plans Over the Phone?
Insurance agents in the Medicare field often wonder what is the best way to sell Medicare Advantage plans. Almost always an agent asks if you can sell Medicare Advantage plans over the phone. The short answer is “no.” The Centers for Medicare and Medicaid Services (CMS) has strict marketing guidelines which restrict prospecting or selling Medicare Advantage plans over the phone. However, there is much more to be discussed about selling Medicare plans by phone.
Medicare Advantage vs. Supplement
There is a way you can sell Medicare over the phone, but it will not be in the form of a Medicare Advantage Plan. Instead, you can opt to sell Supplement plans by phone without following those strict, CMS guidelines.
So what is the difference between selling Medicare Advantage versus a Supplement? Let’s explore the differences to understand why you can’t sell Medicare Advantage plans over the phone.
To begin with, if someone joins Medicare Advantage, they are essentially giving up their Original Medicare (A & B) and choosing to have their insurance company manage all of their care. Advantage plans also come with many restrictions, which can make it much harder to sell than Supplements. For example, Medicare Advantage is limited to a local network of doctors, hospitals, and specialists. This means that if your client needs coverage outside of the plan’s local area, other than emergency care, they won’t be covered.
Medicare Advantage Things to Consider
Other things to consider when selling Medicare Advantage plans include:
- Copays: In most cases, there are copays, coinsurance, and a maximum out of pocket (MOOP) that can total up to $6,700 annually.
- Drawbacks Over Perks: Most advertisers, such as radio and TV will highlight their Medicare Advantage plans as having a $0 dollar monthly premium and other perks like dental coverage. However, they never mention any of the draw-backs when advertising these plans. Many people end up leaving their Medicare Advantage plan after discovering all of the hidden costs and restrictions. As an agent, this is counterproductive because your book of business will experience lots of turnovers. It’s never a good idea to chase down your clients, having to re-sell them new coverage each year.
- Limits on Plan Switching: Medicare Advantage only allows plan switching during Open Enrollment (Oct 15 – Dec 7). This means you only have about 7 weeks each year to service all of your clients.
Medicare Advantage Compliance Training
In addition to not being able to sell Medicare Advantage plans over the phone, compliance training also can be a hindrance. In order to sell Medicare Advantage, you are required to participate in annual training and certification through AHIP. There’s a cost of around $175 for the cert. You must get annual certification through each carrier as well.
When it comes to selling Supplement plans, there is no annual compliance training.
The Advantage Actually Lies Within Selling Supplements
Believe it or not, selling Supplements is actually more advantageous for both you and your client for a variety of reasons. Selling Supplements give you advantages and freedoms not found with Medicare Advantage. These include things like:
- Supplements do not have draw-backs like networks. All Supplement plans by law have to cover you anywhere Medicare is accepted.
- Supplements are very affordable with monthly premiums averaging around $100 – $125.
- Supplements allow plan switching any time of the year (pending medical underwriting)
Selling Supplements over the phone is legal, compliant and still the preferred method of growing a Medicare book of business.
Underwriting When Turning 65 or Joining Medicare
Underwriting for Medicare insurance is another important topic to note when selling Medicare Advantage versus Supplement plans. No matter which plans your client chooses, there will be no medical underwriting when they are turning 65 or joining Medicare for the very first time. Everyone is guaranteed coverage regardless of any pre-existing conditions.
Is the Commission Structure Better With Medicare Advantage?
Medicare Advantage pays a commission for as long as your client keeps their coverage. The problem is that Medicare Advantage plans all have networks, and those networks are always changing. This presents a longevity problem as many agents will experience a drop in client retention. Perhaps their doctor no longer accepts their Medicare Advantage plan or a medication is no longer on the carrier’s approved formulary. There are many reasons why clients generally do not stay with their same Medicare Advantage plan year after year. As an agent, you’ll run into a headache every Open Enrollment by trying to manage your book of business.
Supplements on the other hand do not require nearly as much client management. Supplements do not have networks, therefore, your clients can go anywhere Medicare is accepted. The only management that comes into play is keeping their premiums low. Every several years they may experience a slight increase in their monthly premiums. By switching them to a new Supplement, you reset your 7-year commission with that new carrier.
Final Thoughts: Why You Can’t Sell Medicare Advantage Plans Over the Phone
Being unable to sell Medicare Advantage plans over the phone is one small reason to explore selling other Medicare insurance options. Specifically, selling Supplements gives you more advantages in how you sell, a bigger opportunity to service your clients, and spend less time managing your book of business. This will allow you to take on more clients and offer a great customer experience.