2 Myths to Selling Medicare Advantage
It’s probably safe to assume that about half of our agents sell Medicare Supplements and the other half sell Final Expense – but what percentage of agents sell Medicare Advantage in addition to the other two? I would venture to say that about 15-20% of our readers (and lead buyers) sell Medicare Advantage, just based on the number of questions and requests we get for Medicare Advantage leads.
It’s no lie: CMS can make selling Medicare Advantage a hassle, but with Jimmy’s nine tips, agents will have a good idea whether they want to start offering Medicare Advantage plans to their clients and prospects – and how they can navigate the landscape to stay competitive.
In addition to Jimmy’s tips, he even gives us a couple of scripts to use when calling back leads and when presenting solutions. Hopefully his scripts and tips will help other agents looking to sell Medicare Advantage plans — like his tip about focusing on T65 prospects because they offer the maximum lifetime value for commissions, and when you’re diligent with follow-up, annual reviews and phone calls, these can be some of the best clients and referral sources you’ll find.
For even more script ideas be sure to check out our book.
And if you have a question for Jimmy regarding selling Medicare Supplements, Final Expense, or Medicare Advantage, please submit them in the comment section below. And of course, if you have a suggestion for a future guest of The Heroes Huddle Podcast, leave a comment for us about that, too.
Interview with: Jimmy Hobson
Glen: One thing I wanted to ask, because this is something I hear a lot of, so maybe you can speak to this since you’ve written quite a bit of Advantage plans, I’ve never written an Advantage plan personally myself. Maybe I bought into the hype that Medicare Advantage was too much of a nightmare to get involved with. So maybe you can speak to this, because this is kind of the reputation that Medicare Advantage has. It’s a nightmare to keep up with, that every year you’re scrambling to keep these people on the book during open enrollment, and that’s just follow-up in maintenance work is more than a Medicare supplement plan.
Jimmy: There’s no question about that, it does require more work. However, I am fortunate that I’m in an area that is dominated by United Healthcare. I mean so much so they probably have 60 percent market share or more, and Humana doesn’t really have the largest provider system in Utah in their network, and then your Aetna plan only offers half the network, whereas United Healthcare offers the entire hospital network in northern Utah. It covers 2.5 million people.
So their plan is great, I would say yes, but if you truly understand the plans and you’re able to offer what makes sense to everybody, you know, as long as you put them in the right place to begin with, I think you’re ok. The thing that I think I’m good at that a lot of people lack is that I understand the pros and cons of every single plan. I study them so I know what I’m dealing with, and then I know what’s good for people.
Then I answer the phone and stay in contact with my people, which is the biggest thing. People run and find something that their neighbor has because their agent never bothers to stay in touch with them. Service work is not nearly as daunting as people try to make it out to be. I mean in some states like Florida, I would imagine it is because there’s a bunch of regional plans and different things.
Here, not so much. I mean we have really three or four carriers that we’re selling in the major counties, and outside of those, there’s not much competition. I mean I’ve got clients with everybody, and I look at it every year and I make sure I know where my clients are at, which plan they’re on, and I make sure that there’s nothing drastic coming down the pipes. Fortunately it’s been very stable here.
And so the fear outside of that is the service work is just that. Now there are some areas where people are having to roll people all the time, and I understand the pain of that, because I’ve had to do it in the past, but not so much here anymore. But I tell people unfortunately, that’s the nature of the business. If you’re going to make $250 off a client every single year, is it really that cumbersome to answer the phone a couple times or maybe show up and visit them once in a while?
I mean really, I mean you’ve got to look at it that way. A little becomes a lot pretty quickly if you take care of people, you know, and—
Glen: I totally agree. And one thing I think that a lot of agents miss out on is I think rather than looking at it as service work, I think you should look at it as opportunity, right? I mean talking to these people, maybe there’s something you missed, maybe there’s something they mentioned the first time you talked to them that you can take advantage of on your next conversation, you know? So I think looking at is an opportunity. I mean if someone’s calling you, even if it’s a question or concern, you could absolutely turn that into additional premium on the books. [00:03:42]
Jimmy: Well yeah, whether it be life insurance or they send you their family. I mean you do this long enough, you get a ton of referrals, every time you get a spouse aging in. You know, I sent out a letter a month or so ago, I got a couple immediate referrals off of it, another guy emailed me back and said, “Hey, my wife’s turning 65 in November,” and I responded and said, “I’ll reach back out in August or so when she gets her Medicare card, and we’ll get rolling.”
So just by sending a letter, just by sending 400 or 500 letters out, spending whatever that is, a couple hundred bucks on stamps and mail, I already generated five or six times that back in premium plus the long term residuals with these other people. And that’s the biggest thing, and that’s what people tell you, and I’ve talked to a lot of guy that do exclusively Med Sup, and they do it in a bunch of different states, which is not an easy prospect.
But what they’ll tell you very clearly is that the key is in the follow-up. They hammer people with follow-up. Birthday cards, Christmas cards, whatever it be, and I don’t hit them that hard because I’m local where if someone calls me I can drive to them, but it’s all about the follow-up. You know, they just don’t want to deal with the compliance issues because they’re selling in multiple states, which is a lot of reasons why they don’t want to do Medicare Advantage.
I mean my direct line has guys that are selling Medicare Advantage over the phone. That’s a whole other animal that I’m not going to get into, but their persistency is very good. I mean occasionally they’ll run into someone that would rather deal with a local agent, and that’s awesome. I mean we’re never going to push anybody. If someone would rather have someone come into their house.
For example, I get a lot of California people move to southern Utah, I’m 330 miles from St. George, Utah. I’m not driving 330 miles for a MA deal. So if I can’t relay the information I need to relay to these people over the telephone, I will refer them to a good friend of mine that lives in Vegas that works all of southern Utah, knowing that they’re going to be taken care of.
And vice versa, he wants nothing to do with Final Expense, so if he’s got people up here he sends them to me. It’s a win/win for me, I get paid a lot more.
Glen: There you go. No, networking’s huge, yeah. I think that’s a great point. One thing I wanted to ask you, you mentioned sending out 400 or 500 letters as follow-up, were you doing that by hand? What were you doing, if you don’t mind sharing? I’d be curious to know more. [00:06:08]
Jimmy: So I print out a form letter. I used to address each one by hand, I said I’ll at least address the letter by hand. I do a form letter, I put my card in there, I sign them, I sign one and then print it, of course. But I hand address—well I don’t hand address it, I’ve got an amazing wife that hand addresses every envelope because she loves me, and I send them out. And little by little people move, I get stuff back, it gives me an opportunity to call them and say, “Hey, I show you’ve moved,” because they don’t always tell you.
I mean I’m the least of their concerns, but they seem to get opened up, and I’ve looked into some different options, I’ve got to send out cards accounts that I’ve thought about sending from. And every time I sign somebody, up whether it be over the phone or in person, but I always leave my card in person, but I have magnetic business cards as well. So if I sign somebody up on a Med Sup over the phone that I’ve never met, I send my magnetic business card to them, then I send them a letter outlining what else I do. You know, I can help with annuities, I can help with life insurance or Final Expense.
And the key is, you know, just staying in touch with them. I mean I know a guy that with his down line and everything in his personal production does $1 million a year in Medicare. And he sends one letter a year. So it doesn’t take a whole lot to keep people happy, and I feel like I go above and beyond. I mean I’ve lost people over time, because some people use—they just don’t care, they change, or they get talked into by a slick salesman. You know, I’m a pretty slick salesman, so I know how that works.
But my persistency over time is going to be in the mid to high 90s, even with MA. I haven’t lost that many people just because I answer the phone. And I like Medicare, I like the Medicare business because I think it builds a long-term stream. Final Expense to me is immediate gratification, Medicare is long-term gratification. I’ve dabbled in other insurances, but I keep going back to the Medicare and the Final Expense.
Sometimes I get tired of it. Sometimes. And frankly I don’t know why I get tired of it because 15 or 20 hours a week is nothing to get tired of, but sometimes you get burned out.
Glen: It’s too much money. You just get bored, right? You’re just making too much money.
Jimmy: Yeah, something like that. I don’t think there’s ever too much money, but I know.
Glen: Yeah, I totally—what you were saying, as a Final Expense agent and also when I as selling mortgage protection, my follow-up with clients, I would always try and meet with people once a year. Check in, see how things were going, if they wanted more coverage, friends and family, all that good stuff. So I think you’re right. I don’t think you have to—you don’t necessarily have to have a monthly newsletter. I think the more touches the better, right, I mean for creating a referral network, for staying on your clients’ mind. But even if it’s something as simple as once a year, whether it’s a phone call, a letter like what you just mentioned you were doing. [00:08:56]
Glen: I was talking to Clu (Connors), he’s the president and the owner of Radiusbob, on the last podcast, and something simple like a CRM just goes so far. Do you use a CRM for follow-up to manage these people?
Jimmy: Yeah, I don’t do any drip email thing or anything like that, but I’ve got Capsule, it’s who I use. It’s really basic, but I can put all the notes I want in and all the reminders I want, and it works really well for me. If I was running an agency I’d want something more like Radius, but I’m running me, and that may change down the road, but one of my greatest strengths is I’ve got a memory, I mean it’s scary. I mean I remember people’s doctors. Yeah, that benefits me greatly when someone calls and they’re like, “I bet you don’t remember me.”
Glen: Don’t cross Jimmy. Don’t cross Jimmy, that’s what I just learned. Don’t cross Jimmy, he will always remember.
Jimmy: I mean some of the best guys I learned from in this business, not even on the Medicare side, like JD for example, and I have a ton of respect for John. One of the things he does is he handles every little piece of service work for his Final Expense people, and the guy gets referrals like crazy because he’s willing to do bank changes, he’ll do address changes, he’ll do every little thing to make sure that policy stays in effect.
And because of that, people just keep coming. There’s a lot to be said about that. I’ve learned from some of the best in the business when it comes to both sides of this business. The forums have been great because there’s a lot of guys with a ton of knowledge. I really learned to sell Med Sups from Frank Stastny, his training and everything, I used to have his CRM. That’s what taught me early on the value of Plan G compared to Plan F. A lot of guys were super late to the party on that, and now look at it. Look where we’re at, Plan F is going away.
Jimmy: It’s the nature of the beast, but I think you learn over time. There’s guys that have been in this business 25 or 30 years, I mean I’ve been in this business since ’09. I mean I originally got licensed in Medicare in the early 2000s, probably ’02 or ’03, the problem was back then as I went through kind of a nasty divorce, and insurance is one of those businesses you’ve got to have everything right at home theoretically to be able to produce in the field, or have a bunch of money saved up, which is what I did when I left the car business. I had enough money to get me through three or four months so I could survive and make money.
Glen: Tell me this, when you first got into Medicare Advantage and Medicare Supplements, you were selling face-to-face, right? You were kind of doing Final Expense, then you were selling the Medicare face-to-face, is that right? [00:11:23]
Glen: So what was your transition when you realized, “Hey, I can start selling Medicare over the phone?” And to my knowledge you do most of your business now over the phone?
Jimmy: So I don’t do MA over the phone. Most of my MA business is local unless it’s southern Utah and it’s someone coming from California who’s already had a MA and understands how it works, otherwise I’ll refer it. Med Sups, nine out of 10 I’m selling over the phone. It’s such an easier thing to explain to people, just because there’s a lot less moving parts.
But I still prefer, and because I’m 10 minutes north of Salt Lake, if anyone’s ever been to Salt Lake, I’m 10 minutes north of the airport, so I’ve got all the population of Utah within a 100 mile drive of me. So it’s not like I can’t drive to someone’s house.
And so I try to do MA face-to-face because of the moving parts, because it is a more service-heavy side of the business. If they know who I am and they see me they’re going to be more apt to not move. Med Sups is different, it doesn’t require the service work. They work so smoothly when people use them that you don’t get all the calls and stuff.
I mean, most of the calls I get, they don’t understand the Part B deductible because it changes every year from $147 to $166 to now $183. I mean here we are. But outside of that, it’s not a lot of service work. But I mean if I had my way, all I’d ever sell is Med Sups, but that’s not who my clientele is.
Glen: I think area plays a huge part, and I’m glad you mentioned that. Like here, I’m in Portland, Oregon, if I’m selling Medicare in Portland it would be almost impossible for me to not talk about Medicare Advantage. I mean the penetration rate is like 55 percent or higher. So I think your market that you’re in, whether you’re selling face-to-face or over the phone, you’ve got to look at that, how popular or how heavily populated is Medicare Advantage.
I actually have a heat map, I’m not sure if you saw this, Jimmy, but I have a heat map on my website.
Jimmy: I have, yeah.
Glen: Yeah, that kind of breaks down the counties. It’s great for folks selling over the phone to target those counties that have low MA penetration percentage. That way when you’re talking to someone, chances are they have a supplement plan and not an advantage plan.
So you’re selling Advantage face-to-face, I know some guys who have figured it out. I think it’s becoming easier to sell Advantage over the phone, I think they have an electronic scope of appointment now. I think it’s becoming easier. But yeah, I mean if it was me, I’d probably still be selling Advantage plans face-to-face just because of the guidelines. I wouldn’t want to get tripped up trying to sell something over the phone.
So what was the push though when you were selling supplements that you were like, “Wow, I can do this over the phone. This is easy?” [00:14:00]
Jimmy: You know, I mean it was just that. I could sit at home without showering and make money.
Glen: No pants on.
Jimmy: People like to talk about the pajama man on the forum, but I mean that’s really what it comes down to is for me: I don’t want to work more; I want to work more convenient and this is something that I can really do around people’s schedule. And I think feel like I’m fairly personable. I mean I have a background in the car business and I was very good at it. I’ve been called many positive and negative things about being a salesperson, depending on who you talk to, so I just figured if I learned how to sell it over the phone, and as I got better at it I started using the e-apps and understanding it better, and realized, “Hey, this is pretty easy.”
And people were open to it, especially if you can build rapport. That’s the key. If you’re stale, it’s going to be hard to sell something over the phone. If you can build rapport and talk to people and actually relate to them, and growing up here and being here the majority of my 43 years. I understand the culture very well, even though I’m not a big part of the culture, I understand the culture of Utah very well; the nuances of the people.
You know, like other people say, “These are my people,” these are really my people. I know them, I know both sides of the coin here, so I can go whichever way I need to go on the conversation to make people understand that I know why they are and where they’re coming from. And once I figured that out, I realized this selling over the phone stuff is easy, I’d much rather do it.
So I’ve ordered telemarket leads, I’ve bought your leads, of course. I’ve done a lot of direct mail leads. Of the last 50 Med Sups I’ve written, 48 are over the phone—47 or 48 probably.
But again, where that lies is if I go to someone’s house thinking they may be an MA buyer, they may turn into a Med Sup buyer. So I mean if they’re close enough to me, I’m going to drive to see them. I just feel like it’s the better way to solidify. If they’re long distance, I know I can keep the relationship going, but I feel better because I have a little bit of what you described, a little OCD, a little control.
Jimmy: But I want to know who these people are, because if I can get in their environment and go to their house and know who they are and know their situation, that’s going to solidify a relationship with me, and I’m going to have more knowledge in the back of my brain that if they ever call me, I will have been there and know what’s going on. And to me, that’s huge.
Glen: No, absolutely. I mean the building trust, you mentioned that building rapport, it’s so much easier when you’re selling face-to-face. When someone can see you right there, you can talk about things that you see in their house, I mean you can—you’re in an intimate situation, especially if you’re in their home, you can talk about kids’ pictures, all sorts of stuff. So I totally agree, I mean most of my business, especially on the life insurance side, which is what my focus was, that was all face-to-face.
Yeah, but with Medicare Supplements, I think you’re right, I think the transaction is so easy, and you mentioned this earlier too, that you would do almost anything to get a Medicare Supplement for yourself. It’s great coverage, it’s universal, Plan F is a Plan F regardless of the carrier. [00:16:54]
Glen: And then it’s just a matter of, “Hey, I’m a broker, I work with all these different companies. What do you have? What’s your current coverage with? Who’s your coverage with?” So this was kind the next thing I wanted to talk to you about, the older crowd, the people who already have a Medicare plan versus the turning 65 crowd: What’s your entryway, I guess, or your segue when you’re talking to these people, and what’s your preference? What are some of the pros and cons that you’ve seen working these two markets?
Jimmy: Well, I mean it’s tough, because it depends on where you mail. I mail the direct mail piece hoping I would capture Med Sup people here in the Salt Lake Valley, and all I got was MA people because a lot of them don’t understand it.
So if I’m going to send direct mail, I’m going to send it super low at zero penetration counties, but I just ask people, I said, “Hey, I’m just following up on this card you mailed back,” or, “You received a phone call from our office,” like the telemarket leads that you do.
And I say, “You had expressed interest in seeing if you might be able to save some money or make sure you’re getting all the benefits that you need.” I just say, “There are some other options available out there that you may or may not know about, but we might be able to save you significant money.”
And I really approach it from there and if they spark an interest and say, “Well yeah, I always want to save money.”
I just ask them, “Well, who do you have?” And being in the market, I know as soon as they tell me who they have, I know that they’re paying too much, just because you know what they may have. You know, “I’ve got Mutual, I’m paying $300 a month, I’m 70 years old.”
Maybe they got stuck in that Plan N or whatever it was, and I guess they would be 72 if that were the case, but the market is tough. I don’t get a lot of rollover MA business unless someone’s agent really sucks or their friends and neighbors said, “Hey, you need to call my guy because he’ll take care of you.”
So a lot of the MA business I get is people that are newer to Medicare or spouses aging in or people that have moved out-of-state to here. That’s where a lot of my MA business comes in at the older age is if that’s the case Med Sup-wise. Like for example, I had someone come in the other day from California, southern Utah, they’re GI all day long from a Kaiser MA to a Med Sup.
I said, “Well, let me recommend something to you. If I can get you on the written, I can save you another $25 or $30 a piece with this better plan. And I think just educating people—it’s funny, the guy told me, he’s like, “I knew you were the right guy when you knew what my meds were for.”
Because coming from a life insurance background, I know what every medication is for, unless they’re brand new to the market. I mean I was trained in Final Expense, I carried the pill book with me. My direct up line, one of the best Final Expense guys of all time, Tim Winder said, “That’s your bible. You need that with you.” And I said ok, you know, and off I roll.
And so in studying those things, you know, that’s where I think where I excel in what I try to approach people to say and it’s very simple, I say, “Look, I understand there’s some trepidation here. You’re on a plan, you’re used to the way the plan works. I’m a broker, I represent every single Medicare Advantage plan sold in the state of Utah, and 90 percent of the Med Sups. Some of them I don’t believe in selling because I don’t think they’re valuable for you. However, with that, I will do what’s in your best interest.
“A lot of agents will push Medicare Advantage because they get paid more when you’re new to Medicare. I want you as a client for the long-term, I will do what is best for you. And if this makes sense then great, and if it doesn’t make sense then great.”
But as older people come in they already know how it works, so they already have a Plan F and they’re like, “Well, I like the Plan F.”
I’m like, “Well, I agree with you, Plan F is amazing, but let me give you the alternative.”
And if you can explain it to where it makes sense to people, if they’ll give you that opening, a lot of them don’t want to change, and I certainly get that, and I don’t push. I’m not a pusher. If they’re paying $350 a month, I’m a pusher, but outside of that if it’s over $15 or $20, you know, people need to do what’s in their best interest and what they feel comfortable with.
But that’s what I try to present, I say, “Look, I’m here to help you. Yes, it benefits me, but it will benefit you if you allow me to talk to you about it, and if you’re not interested I respect that as well.” And I tell them thanks and move on. I’m not here to beat people up. It doesn’t work for me.
Glen: Yeah, I think if you have a good system in place, you’re working leads in volume, you know, you’ve got a lot of people you’re talking to, you’re not going to get stressed out about trying to twist Grandma’s arm into switching to your Plan G. It’s just, “Hey, this is what I’m doing, this is how I can help you, and if it doesn’t work out, let me know. Here’s my card.”
One thing I wanted to touch on though, the prescription thing, you’re absolutely right. I always joked I could get involved in like medical sales or something in the medical field just because I knew all these prescriptions like the back of my hand. One thing for any listeners, the Americo Prescription Guide, that was always one of my favorites. I wrote a lot of Americo Final Expense business and they had an awesome prescription guide for telling you the name of the drug, what it’s used for, is it going to be a rated policy or a decline because of what they’re taking.
Unfortunately, Americo’s underwriting sometimes can be a mystery, as those who have written them know if they’re on six or seven or eight prescriptions, and even though most of them are no big deal, sometimes the underwriter will look at that and say, “Well, it’s the combination.” So that can be tough, and I think not just Americo, that’s probably with a lot of carriers.
But back to the older folks versus T65 though, what would you say your number one preference is? I know you work both markets. What do you like more? [00:22:10]
Jimmy: I like the younger, because I feel like if I capture them and I have all the options they’re never going anywhere, so I can keep them longer. That’s the biggest reason. I’ll take any client, I don’t really—to me it’s a client is a client, but I figure if I can capture them at 65 before someone else ruins them, you know, like all the agents that said, “Oh, you’ll never need your Medicare card anymore, you might as well throw it away.”
You know how many times I’ve heard that on a MA? I mean it’s ridiculous, I mean like you’re killing me. So if I can capture them early, educate them on all the plans, show them all their options, then they know, “Hey, this guy’s got all the options, he’s not going anywhere.”
I mean I can take them either way and I’m happy to help other people, because there’s a lot of mediocre agents out there, but if I can get them at 65, I mean I’ve got 15 years of commissions. As long as I answer their questions and take care of them, I mean that’s—you figure $200, that’s $3,000 for every single client. I mean that’s a huge payday. And it’s not all about the money, but let’s be honest, it’s all about the money.
I mean you’re in this business to make money and take care of your family and help people, and by helping people enough and educating them correctly, money’s never going to be an issue no matter what you do. I mean—and it’s amazing to me, every day the opportunities that pop up with different guys that I know from the different things I’ve done on the forum and whatever else, just because I think I have a pretty good reputation of being a straight shooter and answering questions honestly.
Glen: I think that’s a great point. Whether you’re selling a MA plan or a Med Sup plan, when you have a client that’s 65—I think here in the US, the average life expectancy, it’s up to like 86. So I mean you’re talking a potential 20 years of renewals. Obviously, with Med Sup you’re talking about having to potentially rewrite them with a different (company) to continue earning renewals, which ethically they probably have incurred a premium increase on their current plan, so you can probably rewrite them, save them money, and continue earning renewals, and on MA, that’s a little different game.
But with the T65 market, the biggest complaint I hear is just the competitiveness of that niche. You’ve got 10,000 people here in the US turning 65 every single day. [00:24:25]
Jimmy: Oh yeah, and they’re getting killed with—
Jimmy: 100 mail pieces.
Glen: Yeah, right. I mean I remember sitting down with a client, this was a couple of years ago now, and we were talking Medicare, and he’s like, “Yeah, well I’m actually going to sit down this weekend and go through the letters.” I’m like, “Oh, what letters did you get?” And he’s like, “Oh, I’ll show you.”
And he brings it out, it’s a stack of—I mean it could be an encyclopedia of mail that he’s gotten. So you’ve got people like me who do the telemarket leads who are calling these people, and then you’ve got the direct mail.
Glen: I mean they’re getting bombarded from all sides. So I mean it’s a highly valuable client, but I guess can you speak to that competitiveness and what do you do when you find yourself in a situation where maybe someone already talked to someone or they kind of have a plan in place, and then you’re coming in second and you’re trying to figure out what to do? Explain to me how that works.
Jimmy: It’s a tough animal. I sent some mail out for July and August and got very few responses. I mean I’m going to end up losing a little money on the direct mail piece. I was hoping to capture some people that hadn’t been contacted, and I got ahold of some people, and then I had one guy get all mad at me because I told him Plan F was going to go away.
He’s like, “I’ve had other agents tell me that’s not the case.” I’m like, “Look, I’m only here to help you. I’d only recommend something to benefit you, not me, but if that’s the way you want to go, I’m happy to write it, but that’s not the reality.”
I feel like I try to educate people, but it’s so competitive, to be honest with you. I mean I’ve bought internet leads, I’ve bought everything, and some guys suggest mail seven or eight months out. You know, I’ve got a couple websites and stuff that I generate some leads off of and different places. It’s some competitive it’s almost hard to get in front of people, so much so that I’ve decided to start mailing Final Expense again and sitting down with people, and using that to capture the business.
Because that’s always been my philosophy, when I did an interview with one of the former members of the forum, that’s what I talked about is I think you can generate a ton of business, and so I’m going to go about it that way again, and get in front of more people that way, because it’s too competitive. I mean they’re getting hundreds of pieces of mail, and I guess my niche, if I do get ahold of them and get in front of them is that I feel like I know more about the plans and the ways in and out. I’m not just a fly-by-night guy that’s going to come in and try to sell like a Bankers Life and Casualty agent, try to sell one thing.