Working with New Medicare Clients in Poor Health

When you meet with a new Medicare client who has a serious health condition or a hefty prescription drug history, flexible coverage is key for your client’s health and your book of business.

They may not be able to switch plans down the line, so you want to set them up with the best possible coverage for now and in the future. But, how?

You’ll want to help them figure out if they should enroll in a Medicare Advantage plan or stick with Original Medicare and purchase a Medicare Supplement and Part D plan. Then, you’ll want to recommend the best carrier/plan for their budget and needs. But first, remember, honesty is always the best policy (even though it won’t help your clients pay their bills). It’s important you start there.

Explaining the Situation

Your client may be tempted to go the cheapest route, but that can be a dangerous choice if they require a lot of health care services or pricier medication(s). They may save on their monthly premiums, but how much will they lose out of pocket on their deductible, cost-sharing, partially covered or uncovered health care services, and prescriptions? Will they be able to afford the same level of specialized care they’re used to?

It can be hard to look past initial premium savings, but you need to remind your client that they may be able to save money or afford better care if they pay a little bit more for their coverage up front.

It can be hard to look past initial premium savings, but you need to remind your client that they may be able to save money or afford better care if they pay a little bit more for their coverage up front. Also, depending on their condition, certain coverage options may be off the table now or in the future. As their trusted advisor, you should let them know about this and their potential inability to switch plans, if they won’t be able to pass required underwriting in the future.

Medicare Advantage or Medicare Supplement?

The age-old question: Medicare Advantage or Medicare Supplement? Both types of coverage have their time and place. And, both can be great options, depending on the individual and their needs and preferences. Ultimately, it comes down to your individual client, their health and prescription drug needs, and budget to determine which is best for them.

While there are times when someone with a serious health condition (e.g., diabetes) may be better off in a Medicare Advantage plan (e.g., a C-SNP), many times, people in poorer health can thrive with Original Medicare, Medicare Supplement, and Part D coverage. With the latter, clients can better budget their out-of-pocket expenses. They also have access to any Medicare provider across the U.S. that accepts Medicare assignment, whereas Medicare Advantage members may be restricted to seeing providers in their plan’s network. While a plan network may be restrictive in some cases, Medicare Advantage can also offer benefits to lower income beneficiaries and those with health conditions that are not accessible through Original Medicare, Medicare Supplements, and prescription drug plans.

When they fall ill, many Medicare Advantage members leave their plan to go back to Original Medicare so they can access and afford better care.

Consider this: Many people sign up for Medicare Advantage plans when they turn 65 because they’re healthy, and the coverage is affordable and convenient (i.e., their dental, vision, hearing, medical, and even prescription benefits are all in one plan). But, according to an analysis by the Government Accountability Office, when they fall ill, many Medicare Advantage members leave their plan to go back to Original Medicare so they can access and afford better care.

This doesn’t automatically mean they have a guaranteed issue right to enroll in any Medicare Supplement of their choosing. Some states allow guaranteed acceptance into their Medicare Supplement plans and in these markets, members don’t need to have a specific Guaranteed Issue right to join a Medicare Supplement plan. Many times, people only have this kind of right if they’re initially eligible for Medicare or within 12 months of signing up for Medicare Advantage plan. And without having a guaranteed issue right, your client may have to pass underwriting to get into the Medicare Supplement plan they want.

What Else to Consider Before Recommending a Carrier & Plan

Once you’ve helped your client figure out if they’ll be looking for a Medicare Advantage or Medicare Supplement and Part D plan, it’s time to help them find a carrier and plan, or carriers and plans. We recommend keeping an eye out for:

  • A carrier/plan with a long, positive financial history
  • A company with an established and positive record of service for their membership
  • A plan that doesn’t accept guaranteed issue business (if you’ve recommended a Med Supp)

These plan features can all point toward more stable premiums and cost-sharing in the future. If your client is interested in a Med Supp plan, remember that prices can vary greatly, even in the same area, but same-lettered plans provide the same basic benefits due to their standardization across 47 U.S. states.

And, if your client’s rates seem to get too high, know that you may be able to help them get into a plan with a lower rate by utilizing the Medicare Advantage trial period. If they’re eligible for this special SEP, they can drop their Medicare Supplement coverage in exchange for Medicare Advantage coverage with the option change back to Original Medicare coverage within 12 months. People who do return to Original Medicare get a guaranteed issue right for 63 days to buy Medicare Supplement insurance.

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The Centers for Disease Control and Prevention report that 60 percent of American adults have a chronic disease while 40 percent have two or more chronic diseases. It’s likely you’ll meet several individuals with serious health issues who want to enroll in Medicare over your career as an agent. Be sure to take all of the information discussed above into account while attempting to help them find the right coverage path for their unique situations.

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