Jane Dotson
Selling Medicare insurance can be a lucrative business, especially with the growing number of people entering the Medicare market. To sell Medicare, you must become a licensed life and health insurance agent in your state, which involves meeting basic insurance licensing requirements and passing a state exam. You will also need to complete further training and certifications to offer certain Medicare products, such as Medicare Advantage Plans and Prescription Drug Plans. When selling Medicare, you can choose between face-to-face visits or electronic and phone communications, with the latter being more convenient for both parties. It is important to understand the needs and preferences of your target demographic and build relationships with them to gain their trust. Commissions for selling Medicare plans can vary, with agents earning either a flat dollar amount per application or a percentage of the premium sold.
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What You'll Learn
- Understanding the market: Medicare is aimed at seniors, so relationship selling is key
- Getting licensed: Requirements vary by state, but you need a health insurance license
- Choosing products: Options include Medicare Supplement, Advantage, and Part D Plans
- Working with an FMO: Field Marketing Organizations can help you secure contracts
- Marketing rules: There are strict rules for advertising and selling Medicare plans
Understanding the market: Medicare is aimed at seniors, so relationship selling is key
Selling Medicare insurance can be a rewarding opportunity to help seniors understand their healthcare options and earn a generous commission. With the aging population and approximately 11,000 Baby Boomers turning 65 every day for at least the next decade, there is a constant, growing need for Medicare coverage, providing a steady stream of potential clients.
To sell Medicare products, you must secure appointments with insurance carriers by completing independent agent agreements or contracts. There are a very limited number of insurance companies that will offer you a direct contract without being a captive or employed agent, so most of your independent agent contracts for various insurance companies will be acquired through a Medicare Field Marketing Organization (FMO). A good FMO empowers you to sell more, earn more, and stay independent. They will help you secure contracts with top insurance companies, provide ongoing support, and enable you to focus on growing your business effectively.
Before you begin selling Medicare insurance, you must become a licensed life and health insurance agent in your state (or any state where you plan to sell). In most cases, you only need a health insurance license, although some states, like North Carolina, have specific licenses to sell Medicare products. Outside of any training needed to complete state licensing requirements, you will also be required to complete training and certifications to offer certain Medicare product options, namely Medicare Advantage Plans and Prescription Drug Plans. Additionally, CMS has an excellent online training library that you can use to dive deeper into specific topics of Medicare and even have fun with mock tests.
When selling Medicare insurance, it is critical to learn about the demographic you're selling to and offer the best service and product that honestly addresses their needs. Seniors have seen advertising and sales tactics evolve over many years and are quick to see through them. A sales technique not based on an honest desire to help will raise immediate red flags in their minds. Both face-to-face and electronic sales methods are viable options, especially now that the vast majority of competitive and reputable insurance companies have adopted an e-application process for agent use.
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Getting licensed: Requirements vary by state, but you need a health insurance license
To sell Medicare insurance, you will typically need to obtain an insurance license. The specific requirements for this license vary depending on the state. For example, in North Carolina, there is a specific license to sell Medicare products, whereas in most other states, a health insurance license is sufficient.
To obtain a license to sell Medicare insurance, you will typically need to complete pre-licensing education, pass a licensing exam, and submit an application to your state's insurance department. Most states require proof of pre-licensing education before you can get your health license. These pre-licensing courses can be taken in-person or online, and costs vary anywhere from $99 to $400. A great place to start is by looking at your state's Department of Insurance website, where they will likely have a list of approved pre-licensing courses.
After completing the required education, you will need to pass a state health insurance exam to become officially certified to sell health insurance products in your resident state. Many health insurance exam vendors offer a life insurance certification at the same time as preparing for the health certification. While this is not required to sell Medicare products, it is beneficial to have this license to provide your clients with other insurance product needs.
In addition to the health insurance license, some states may require other licenses or certifications to sell Medicare insurance. For example, some states may require a Long-Term Care Insurance (LTCI) Certification or a Certification for the Sale of Health Insurance Under the Affordable Care Act. It is essential to research your state's specific requirements to ensure you have all the necessary licenses to sell Medicare insurance.
Once you have obtained the required licenses, you will also need to complete training and certifications to offer certain Medicare product options, such as Medicare Advantage Plans and Prescription Drug Plans.
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Choosing products: Options include Medicare Supplement, Advantage, and Part D Plans
As an independent agent, you will have a range of Medicare products to choose from, including Medicare Supplement Products, Medicare Advantage Products, Prescription Drug Plans, and Ancillary Products. Your portfolio will depend on your territory and sales model.
Medicare Supplement Insurance, also known as Medigap, is extra insurance that helps pay your share of costs in Original Medicare. Generally, you need to have Part A and Part B to buy a Medigap policy, and some policies offer coverage when you travel outside the US. Medigap policies do not usually cover long-term care, vision, dental, hearing aids, private-duty nursing, or prescription drugs. Agents selling Medicare Supplements earn a percentage of the premiums of the policies they sell, and the commission is not set by CMS.
Medicare Advantage, also known as Part C or an MA plan, is offered by Medicare-approved private companies that must follow rules set by Medicare. Most Medicare Advantage Plans include drug coverage (Part D). To join a Medicare Advantage Plan, you need to have Part A and Part B. Before joining, it is recommended that you talk to your employer, union, or benefits administrator about their rules, as joining a Medicare Advantage Plan might cause you to lose your employer or union coverage.
Prescription Drug Plans (PDPs) are optional and are available to everyone with Medicare. Agents selling Medicare Advantage and PDPs receive a flat dollar amount of money per application, with the maximum broker commissions set annually by CMS.
To sell any of these products, you will need to complete the necessary training and certifications, as well as acquire an appointment with an insurance carrier by completing an independent agent agreement or contract.
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Working with an FMO: Field Marketing Organizations can help you secure contracts
Field Marketing Organizations (FMOs) are entities that serve as intermediaries between insurance carriers and independent sales agents. They act as a bridge, facilitating the distribution of insurance products from carriers to sales agents and ultimately to consumers. By collaborating with multiple insurance carriers, FMOs offer a wide array of insurance products, including life insurance, annuities, health insurance, and property insurance. This allows them to provide sales agents with a diverse portfolio to meet the needs of different client demographics. FMOs also assist in negotiating contracts with insurance carriers on behalf of their licensed sales agents, helping them secure competitive commission rates, bonuses, and incentives. They provide valuable guidance on compliance requirements and regulatory changes, ensuring that sales agents adhere to industry standards and best practices.
Working with an FMO can bring several benefits to agents. Firstly, FMOs have established strong relationships with insurance carriers, allowing them to offer diverse quality products from top companies. This includes well-known insurance carriers such as those offered by The Brokerage Inc. By partnering with an FMO, agents can access a broader range of products and create an ideal portfolio that positions them effectively in their market. FMOs also provide ongoing support and guidance, helping agents navigate the complex and highly regulated insurance industry. This support includes training programs that enhance the skills of agents in selling and representing their carriers.
Another advantage of working with an FMO is the potential for increased sales and business growth. FMOs provide marketing support, helping agents generate leads and expand their client base. This may involve providing access to marketing materials, lead generation tools, and tailored marketing campaigns. Additionally, FMOs can connect agents with insurance companies of all sizes, allowing agents to sell health plans from multiple top-tier insurance carriers rather than being limited to a single carrier. This expanded network can significantly enhance an agent's product offerings and client reach.
Furthermore, FMOs provide assistance with the contracting process, enrollments, and commission structures. They help agents understand health insurance regulations, pricing structures, and underwriting guidelines, ensuring compliance and effective risk management. The support and resources offered by FMOs enable agents to focus on prospecting and executing their plans for success in the insurance industry. FMOs act as valuable liaisons, facilitating efficient distribution and contributing to the growth and success of the insurance industry as a whole. Their role in aggregating and distributing insurance products is particularly crucial in the context of health insurance, where they collaborate with various carriers to offer a broad spectrum of health insurance policies.
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Marketing rules: There are strict rules for advertising and selling Medicare plans
- Use confusing words or images, or misleading Medicare logos. For example, marketers cannot use superlatives like "best" or "most" without referencing a data source from the current or prior year.
- Pressure you to join their plan, for example, by saying "you have to join this plan or you won't have coverage next year".
- Ask for names and phone numbers or addresses to sell to friends or family.
- Ask you to sign the enrollment form before you're ready to join.
- Fail to give you written information with a complete description of how the plan works.
- Fail to make clear that there's no guarantee that your doctor or hospital will agree to accept the plan's terms and conditions.
- Fail to send you a letter with instructions on how to disenrol if they can't reach you by phone.
- Fail to have people available to answer any questions about the plan.
- Come to your home uninvited to sell or endorse anything.
- Call you unless you're already a member of the plan or you've given them permission to contact you.
- Require you to speak to a sales agent to get information about the plan.
- Offer you cash or gifts worth more than $15 to join their plan.
- Give you free meals during a sales pitch for a Medicare health or drug plan.
- Ask you for payment over the phone or online.
- Tell you that they're Medicare supplement insurance (Medigap) policies.
- Sell you a non-health-related product, like an annuity or life insurance policy, during a sales pitch for a Medicare health or drug plan.
Medicare plans and people who work with Medicare can:
- Give you plan materials.
- Tell you about the plan options and how to get more plan information.
- Give you an enrollment form.
- Collect your completed enrollment form.
- Leave business cards for you to give to friends and family.
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Frequently asked questions
Yes, you need to be a licensed life and health insurance agent in your state or any state where you plan to sell. In most cases, you only need a health insurance license, but some states, like North Carolina, require a specific license to sell Medicare products.
Requirements vary by state, but generally, you must complete an exam preparation course and pass a state exam. Some states also require classroom training, background checks, and fingerprints.
You can sell a range of products, including Medicare Supplement Products, Medicare Advantage Plans, Prescription Drug Plans, and Ancillary Products. The specific products you offer will depend on your territory and sales model.
To sell Medicare products, you typically need to secure appointments with insurance carriers by completing independent agent agreements or contracts. A Field Marketing Organization (FMO) can help you obtain these contracts and develop a product strategy.
It is recommended to use a relationship-selling method when marketing to seniors. Understand their needs and preferences and offer honest and genuine advice. Many insurance companies now offer e-application processes, making it convenient to interact with customers electronically or over the phone.
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