Although many agents and insurers market Medicare toward senior citizens, they aren’t the only people covered by this government program. In fact, more than eight million Medicare recipients are under the age of 65.
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There are distinctions in how people become eligible for Medicare under the age of 65, usually based on eligibility requirements imposed by the Social Security Administration. We’ll analyze this group of enrollees together and discuss how you can best utilize this knowledge for your insurance sales. Understanding who comprises this market and how you can best meet their insurance needs could open your business up to a whole new batch of potential clients!
More than eight million Medicare recipients are under the age of 65.
Who’s Eligible for Medicare Under Age 65?
The simplest answer for how individuals under 65 can qualify for Medicare is that they’ve been receiving Social Security Disability Income (SSDI) or Railroad Retirement Board (RRB) disability benefits for a minimum of 24 months. To qualify for SSDI or RRB disability benefits under the age of 65, medical professionals must determine that the beneficiary is unable to work or provide for themselves due to a physical or mental health impairment that will last at least 12 months, or until the person’s death. Usually, someone must work a required number of work credits to qualify for SSDI or RRB benefits; however, there are extenuating circumstances when someone’s work credits may be transferable to their disabled child, spouse, widow, or widower.
What Disabilities Qualify Someone for Medicare?
Should someone be diagnosed with end-stage renal disease (ESRD) or amyotrophic lateral sclerosis (ALS), they’ll automatically qualify for Medicare coverage that begins immediately with their first SSDI or RRB disability check. While these may currently be the only illnesses that automatically qualify someone for coverage, there are other common diseases that can qualify someone for SSDI and Medicare. A 2016 Kaiser Family Foundation study listed these conditions as certain mental disabilities (34%), musculoskeletal disorders (28%), case-specific illnesses like cancer (3%) or injuries (4%), or other conditions (30%). More specific diseases/disabilities include, but are not limited to:
- Multiple Sclerosis
- Cerebral Palsy
- Neurodevelopmental Disorders
- Cystic Fibrosis
- Heart Disease
- Chronic Liver Failure
- And more! (no disease can be an automatic disqualification)
A Deeper Understanding
The Kaiser Family Foundation also reports that a large portion of Medicare beneficiaries under 65 also receive Medicaid assistance, approximately 25% more than senior citizens, and were more likely to receive non-Medicaid Extra Help. This exemplifies the income difference between the traditionally eligible group, which is open to any citizen regardless of their income, compared to the under-65 group, who tend to have lower incomes due to their disabilities creating excessive barriers, or making it impossible, to obtain work.
In 2016, about 60% of Medicare beneficiaries under the age of 65 had annual incomes below $20,000, according to AHIP’s Medicare Advantage Demographics Report. That’s twice as many Medicare enrollees with low incomes in the below 65 group compared to the beneficiaries over the age of 65!
A large portion of Medicare beneficiaries under 65 also receive Medicaid assistance, approximately 25% more than senior citizens.
In addition, AHIP found the under-65 group is more culturally and racially diverse, with only 62% of under-65 Medicare beneficiaries being “white non-Hispanic,” compared to 78% of the 65+ group in 2012. Non-white groups have also had consistently higher enrollments in Medicare Advantage than Original Medicare since 2013. This trend will likely continue as the rate in Medicare enrollment continues to increase.
Medicare Advantage Sales Potential
Due to these clients' special circumstances allowing them to qualify for Medicare coverage under the age of 65, they are more likely to have specific plan needs that Medicare Advantage plans can accommodate. This can be particularly beneficial for the insurance agent, because these clients are more likely to update or switch plans due to the extra Special Enrollment Periods (SEPs) they may qualify for outside of their Initial Enrollment Period (IEP) or the Annual Enrollment Period (AEP)!
As of 2020, there are more under-65 Medicare beneficiaries enrolled in Medicare Advantage than Original Medicare. Medicare Advantage enrollment grew 60% from 2013 to 2019! With the number of these plans on the market increasing and the number of enrollees projected to only grow over the next decade, selling Medicare Advantage plans to under-65 clients is an opportunity no insurance agent should miss out on!
Special Needs Plans (SNPs)
Many of the under-65 Medicare beneficiaries may qualify for a Special Needs Plan, one of the most beneficial types of Medicare Advantage plans. For clients that just qualify based on a disability, a Chronic Condition Special Needs Plan (C-SNP) might do. However, many in this group are eligible for both Medicare and Medicaid, due to their disabilities and lower incomes, and are therefore able to enroll in Dual Eligible Special Needs plans (D-SNPs).
According to AHIP, the under-65 dually eligible group comprises 43% of all dually eligible Medicare beneficiaries as of 2016 — and 35% of the Medicare Advantage market! D-SNPs are low-cost Medicare Advantage plans that are not only extremely beneficial for clients, since they enable more coordinated care, but equally so for the agents who sell them. Being contracted to sell D-SNPs allows agents to continue selling to more clients outside of the Annual Enrollment Period, during lock-in! This is an invaluable opportunity for insurance agents to increase their sales and commissions and serve the underserved and less privileged who need the best possible Medicare plans they can afford.
Part D Opportunities
A stark contrast between these groups, and where more sales opportunities outside of AEP arise, is in the under-65 group’s increased enrollment and spending on prescription drug plans (PDPs). Among the under-65 beneficiaries, 75% are enrolled in a PDP or MAPD plan compared to 63% of seniors, reports the Kaiser Family Foundation. Also of note, 55% of younger beneficiaries receive Part-D low-income subsidies (LIS), whereas only 16% of older beneficiaries receive them. Younger individuals also spend roughly $3,000 a year more on Part D drugs than older individuals, which is the biggest difference in spending on any part of Medicare between the groups.
75% of the under-65 beneficiaries are enrolled in a PDP/MAPD plan compared to 63% of seniors
This opens a gap in coverage where insurance agents can offer a variety of different MAPD or PDP plans to their clients who may be overpaying for, or are simply unhappy with, the current coverage they carry for their prescriptions. By educating clients on their options, apart from Original Medicare, you could make an invaluable impact on your community and improve the lives and health of these individuals!
While it may not be on the top of your list as a Medicare insurance agent to market and sell to those under the age of 65, you could be missing out on commissions from a market in your area that would benefit greatly from the products you sell. Moreover, you could be helping improve your community by providing more Medicare coverage options for your disabled, underserved, and disenfranchised neighbors. There’s no greater impact one can have than helping those less fortunate than themselves, and as an insurance agent you are in the perfect position to do so!
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