Selling Medicare Advantage plans can prove to be highly lucrative for insurance agents. The US Census Bureau, for instance, estimates that by 2030, every Baby Boomer will be 65 years old or older. Five years after that, it’s estimated that 78 million people in America will be 65 or older. The result is an increased demand for Medicare Advantage plans.
Below, we provide a complete guide so you can learn how to sell Medicare Advantage plans to serve the growing need in your community.
What Is Medicare Advantage?
People have multiple options for how they can get Medicare coverage. One way is to choose traditional Medicare Part A and Medicare Part B coverage. These are offered directly through the government.
Another option is to choose a Medicare Advantage Plan, sometimes called Part C of MA Plans. These insurance plans are offered by private insurance companies that Medicare has approved to sell the plans, and as such, must follow the rules that Medicare sets.
Many people today prefer Medicare Advantage plans over Plan A and Plan B (known as Original Medicare) because they can bundle different insurance services together. For example, they can get hospital insurance (Part A), medical insurance (Part B), and prescription drug coverage (Part D).
In addition, Medicare Advantage provides coverage for some other items that the Original Medicare plans don’t cover—this includes some dental, hearing, and vision services. Some plans even let people choose services catered to their specific needs, such as transportation to and from doctor visits and other services that promote overall wellness.
As an insurance agent, this provides an excellent opportunity to help your customers get the specific coverage they need. They won’t be choosing just from an off-the-shelf, pre-designed plan. Instead, depending on which insurance companies you can sell from, you can help your customers customize a Medicare Advantage plan specific to their needs. Indeed, finding the right plan for your clients—one that works to minimize the stress of doctor visits—can make a big difference in someone’s life!
How Medicare Advantage Plans Work
Private companies that offer Medicare Advantage plans will receive a fixed monthly payment from Medicare for each of the plans they provide customers. In return, private insurance companies have to follow Medicare’s rules.
Each plan itself can alter how much the out-of-pocket expenses will bill. They also can set rules for whether insured need to obtain a referral before they visit a specialist, and whether you have to visit doctors and providers in a specific network.
People with Medicare Advantage plans will have a maximum amount to pay in out-of-pocket expenses each year. Once they reach that amount, all covered services under Original Medicare will be covered entirely.
Why Sell Medicare Advantage Plans
Medicare Advantage Plans not only provide a lot of flexibility for customers, but they also provide the same for insurance agents. The market is highly competitive among insurance companies that offer them, which results in agents receiving relatively high commissions when they sell these plans.
On average, you can earn $287 per year in commission for each Medicare Advantage plan you sell that replaces a plan already in place. If you can sell a Medicare Advantage plan to someone who hasn’t had one before, your annual commission can be even higher—on average, $573 per year.
If you can sell these policies—and retain most of your customers from year to year—you could easily make a substantial income on just Medicare Advantage plans alone.
As of 2022, 48% of all eligible people for Medicare had a Medicare Advantage plan. However, that number is only supposed to grow in the coming years as the population ages and healthcare costs continue to rise.
From a customer’s standpoint, figuring out which Medicare Advantage plan to purchase can be pretty challenging. As of 2022, the average person had 39 different Medicare Advantage plans to choose from.
In other words, these Medicare beneficiaries have a strong need to partner with an insurance agent who can help them wade through the very complicated Medicare Advantage market so they can find the plan that’s truly the best for them.
What Licenses Are Needed to Sell Medicare Advantage?
Like selling any other type of insurance, you must obtain specific licenses and certifications to sell Medicare Advantage plans.
First and foremost, you’ll need to be licensed in the state where you primarily sell insurance. The requirements for this will depend on your specific state, so make sure you check your state requirements. If you want to sell insurance in other states, you’ll need a non-resident license that will allow you to sell insurance there, too.
After obtaining these state-specific licenses, you must complete the AHIP (America’s Health Insurance Plans) certification process.
What Is AHIP Certification?
The Centers for Medicare and Medicaid Services requires all insurance agents who want to sell Medicare or Medicaid to complete AHIP certification. This test is required annually, as the rules for Medicare could change yearly.
The training will cover all the basics of Medicare eligibility, the available benefits, the options people have to obtain coverage for prescription drugs, as well as enrollment and marketing compliance and regulations. The AHIP tests cost $175, and agents will get three tries at passing it. All information about obtaining AHIP certification can be found on their website.
FWA Training
In addition to AHIP certification, all agents who want to sell Medicare Advantage plans must complete FWA training, which stands for fraud, waste, and abuse.
This training will teach agents the best industry practices to detect potential Medicare fraud and provide tools they can use to help them do so. It’ll also instruct agents on FWA’s financial and human costs and the proper reporting procedures if they suspect Medicare fraud.
FWA training is available today through the AHIP, making signing up for the courses and obtaining your proper training easier.
Carrier-Specific Training
In addition to the two above certifications, agents will typically have to complete training and certification from the specific carriers from which they will offer Medicare Advantage plans. This training will differ from one carrier to the next, so check with each carrier from which you plan to provide Medicare Advantage plans.
How to Find the Best Medicare Advantage Carriers
Now that you’ve obtained all the necessary licenses and certifications and completed all necessary training, you’ll have to obtain contracts with different Medicare carriers to sell the products they offer. But figuring out where to begin can be challenging with so many different carriers offering Medicare Advantage plans.
An excellent place to start is with any insurance carrier you currently have a contract with. For instance, if you already have an agreement with Insurance Company A to sell property and casualty insurance, you might find out whether they also offer Medicare Advantage plans.
There are many benefits to going this route. First, you already have an established relationship with the company, which could make onboarding, training, and working with them easier. Second, companies with which you already have contracts may not have as many stringent requirements for you to sell Medicare Advantage plans as compared to companies with which you don’t have contracts. Finally, you might be able to earn higher commissions with insurance carriers that you already have a working relationship with.
However, the statement above doesn’t mean you should only approach insurance carriers you already work with. For example, it might be advantageous for your business to offer a wide variety of Medicare Advantage plans to grant your customers the freedom of having many choices.
For example, it could behoove you to contract with insurance carriers that offer Medicare Advantage plans with certain features and coverages that some of your current carriers don’t offer. This would provide your potential customers with more options regarding Medicare Advantage plans, which could expand your potential customer base.
How to Contract with Medicare Advantage Carriers
The process for contracting with Medicare Advantage carriers is very similar to contracting for other insurance plans. First, you’ll need to submit paperwork to the carrier; they will then process it and conduct a background check on you. They’ll also likely analyze your current business, your business plan, and how well they believe they’d fit within your offerings. It could take up to six weeks from when you apply for a contract to when you receive a decision, so keep that in mind for your planning purposes.
A potential challenge you may face is that many insurance carriers offering Medicare Advantage plans don’t like dealing with independent insurance agents directly. As a result, some may even decide not to provide their plans to independent agents. Luckily, if you are an independent insurance agent, you will still have plenty of options to partner with Medicare Advantage carriers. In addition, by partnering with an experienced Insurance Marketing Organization (IMO), you’ll gain access to many of the top insurance carriers in the country.
The Best IMO for Medicare Advantage
Medicare Advantage carriers trust independent agents who work with respectable IMOs since it proves they have been appropriately vetted. This is another reason why working with a trusted IMO can be a huge boon to all independent insurance agents.
Today, GLIA is among the best IMOs in the market. We have years of experience working with independent insurance agents and the top Medicare Advantage carriers in the country. By partnering with us, you’ll gain access to these carriers and our impressive suite of tools, support, and training we provide to all agents.
Contact us today for more information on how you can get started offering Medicare Advantage plans from the top insurance carriers. Again, thank you for visiting our blog, and we hope to speak with you soon!