The Most Wonderful Time of the Year….

December 18, 2009
Denver CO

The holiday season is brimming with ample opportunities to embrace all sorts of pleasures, from chocolate and pastries, to presents and entertainment. Well, maybe not if your a broker or consultant for the Medicare community.

So, what exactly do we do during this festive time of year? Merry making comes second to work, work and, of course, work — at all hours. For those doing Medicare, the clock is literally ticking. Midnight on New Year’s Eve is it!

Medicare is the federal government program that provides health insurance for people over the age of 65. As the result of the Medicare Modernization Act of 2003, the period from November 15th until December 31st is the Annual Election Period during which Medicare beneficiaries can make wholesale changes to the sorts of coverages they use to reduce or eliminate the gaps in covering the cost of health care — gaps due to Medicare cost sharing and reimbursements that fall well below costs.

Plans to fill those gaps are offered either by Medicare Supplement plans, and the increasing popular, Medicare Advantage plans. Since MA plans are annual contracts with Medicare, and since the monies from Medicare to pay for MA plans changes, people receiving Medicare must re-evaluate their coverages for the next year during the AEP. So… as they often do  in the movies, let’s flashback a couple of months to pick up the story.

Toward the end of the first quarter of the year, Medicare (called CMS, which stands for the Centers for Medicare and Medicaid Services) issues a Call Letter, inviting health plans around the nation to submit their plan proposals for the following year for both Medicare Advantage and Part D, the Medicare outpatient prescription drug program. These proposals, called “bids” are generally due by early June.

Oh and now the fun begins!! CMS reviews these bids, iterating the proposals with the carriers, to achieve the final results. The idea is that published materials need to be available by October 1st, the date on which the plans must notify existing MA beneficiaries of changes for the upcoming year.

Of course, during these lazy summer months, the broker is busy having fun in the sun, right?! Au contraire, mon ami (to quote Q from Star Trek).

For the broker that serves the Medicare community, the summer is devoted to certifying and testing so that they can offer the products of various health plans to seniors for the coming year. There is a national test (which must be passed with a score of no less than 90%), and tests for individual health plans as well. Failure to pass these tests locks the broker out of the market for a year.

One of the most entertaining sections deals with marketing  and compliance parameters. CMS has implemented severe restrictions, from how a Medicare beneficiary can be contacted, to how information must be presented. One of my favorites is the Appointment Verification Form. This form records the agreement that is made prior to any appointment about what is to be discussed — no other matter can be discussed other than what has been previously agreed. If a senior wants to discuss their life insurance — no can do — they have to wait for a couple of days to cool off! Yep, that’s how hot Medicare is!

[Since this form was introduced, no meeting I have ever had with a Medicare beneficiary has ever gotten past the presentation of the verification form without a great deal of consternation and laughter. Most people say "this thing is so complicated I don't know what to ask about." Most of the time, we just agree to discuss everything the client wants to discuss, as long as it's about Medicare related matters. (almost all of these meetings, by the way, start with educational presentation -- no matter how long the person has been 0n Medicare!)]

Then of course, there is the need to attend seminars, or what we call “roll outs” either in person or via web conference. (Why is it that seminars always last at least 2 hours, even if there is very little to be discussed!) Brokers always hope that we can have all this organized by October 1st, which has proven a vaporous dream, at least in the last couple of  years. I figure that by October 1st, the average broker must invest at least 3 man weeks of time preparing — none of which produces revenue, by the way.

Then come the contacts. CMS does not allow brokers to contact prospective clients by phone or email. Only seminars and direct mail can be used (and we all know how efficient direct mail is!!). Most contacts come to us through referrals, community encounters, and some direct response.

This year, I arranged 10 global meetings to meet with my existing clients to discuss the coming year and to see what adjustments needed to be made. Clients could attend a meeting of their choice. Of course, there are also the dozens of other meetings with new clients that have to be arranged and conducted.

Every meeting ends with a sign off, “you know, it’s human nature that 20 minutes after you’ve left, you’ll have forgotten 80% of what we talked about. So…always call when you have a question!” Bon homme, and all that!

So that’s all there is to that! Well except of course all of the group renewals that happen on the 1st of the year, and the carrier rate actions on individual policies that go into effect on January 1st. Yep, this is a relaxing and stress free time of year.
Now, where is that eggnog?! Oh, not yet — there’s still two weeks left in AEP!!

R Allan Jensen

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