How Can Insurance Agents Benefit From Medicare Advantage Changes?

After months of debate in Washington, healthcare reform is finally a reality! What does that mean to insurance companies? Is it a good thing? Is it a bad thing? Is it a mixed bag? From my perspective, healthcare reform is a GREAT thing. Healthcare reform focuses on major medical insurance - not life insurance, voluntary benefits, or Medicare Supplements.

Voluntary Benefits and Employers

Voluntary benefit sales should continue to expand and not just for smaller businesses. Employers continue dropping insurance sponsored coverage for workers at an alarming rate. Many large companies and corporations have experienced steadily rising insurance premiums over the past ten years as medical costs have grown. As a part of healthcare reform, employers with fifty or more workers will face government fines whenever they don't provide their employees with insurance coverage. A recent online article noted several major corporations that are considering dropping employer-sponsored health coverage in exchange for paying penalty fees to your government. If the price tag on providing employer-sponsored health insurance to their employees is greater than the total amount of the fine, what choice do they have? They eliminate their employer-sponsored coverage, pay the federal government fine, and come out ahead financially. But, where does that leave their employees? Without benefits!

Since many employers feel an ethical, if not just a legal, obligation to offer benefits for their employees, they ought to turn to giving employees access to voluntary benefits. Work site may easily become the golden child for the insurance industry.

The Future of Medicare Supplement Sales

I believe healthcare reform will very positively affect Medicare Supplement sales for years to come. Beginning in 2011, federal payments to Medicare Advantage plans are going to be substantially cut, and cuts will continue in the coming years. That step will cause more insurers to withdraw from the Medicare Advantage marketplace. More Seniors will lose their coverage and return to Original Medicare and buy a traditional Medicare Supplement.

Obviously, Baby Boomers' retirements will have a profound effect on Medicare Supplement sales for decades. According to the U.S. Census Bureau, by 2030 the 65-plus population will double to about 71.5 million, and by 2050 it'll grow to 86.7 million. That represents massive numbers of potential Medicare Supplement sales!

Because today's retirees tend to be more educated than those of previous generations, they've a better understanding of what Medicare does and doesn't cover. They understand the need to plan for their future and the value a quality Medicare Supplement will have once they confront health issues. They even have on average adequate disposable income to afford a top quality Medicare Supplement.

Some areas of healthcare reform won't go into effect until 2014; even then, there'll always be out-of-pocket expenses that traditional major medical plans will never cover. Supplemental insurance protection will always be important to a person's overall healthcare planning. Cancer and critical illness policies will still grow in popularity given the vast quantity of media attention focused on cancer and critical illnesses like heart disease and stroke. With a continued increase in obesity, shown to be a precursor of a lot of these health issues, the worth of cancer and critical illness policies will become more obvious with each passing year. On top of that, individuals who may choose not to acquire any form of basic or extended supplemental health coverage could still be receptive towards a lump-sum cancer or critical illness policy.

What does healthcare reform mean to us? OPPORTUNITY! Ahead looks bright - especially for life, work site, and Medicare Supplement sales. But, we require more talented Agents in place during the coming months to handle the rising workload. As a result of impending commission changes in the major medical marketplaces and in Medicare Advantage, you will have access to a larger and versed pool of Agents. Reap the benefits of that. Continue recruiting. Continue training. Make the most of the amazing potential around you when it comes to both people and products!

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