The average minimum comp level in the Medicare Advantage HMO
market could be about $528 per enrollee per year.
Issuers of stand-alone Medicare Part D
prescription drug plans may pay much higher minimum sales compensation levels
in 2020.
Medicare drug plan issuers that operate in all
counties in a state will be paying an average minimum compensation amount of
about $19 per year per new enrollee, and about $9 per year per renewal
enrollee, in 2020, according to ThinkAdvisor calculations based on a new agent
and broker compensation spreadsheet posted by the Centers for Medicare and
Medicaid Services (CMS).
That’s up from an average minimum compensation
level of about $14 per year per new enrollee, and about $6 per year per renewal
enrollee, this year, according to the CMS producer comp spreadsheet for 2019.
The marketwide averages are low because some
issuers pay nothing to producers, or pay nothing for at least some classes
of initial or renewal enrollments.
Producer compensation appears to be on track
to be higher, but increase more slowly, in the Medicare Advantage plan market.
For a Medicare Advantage health maintenance
organization plan or HMO point-of-service plan that’s available in all counties
in a state, the average initial sales compensation will increase to about $528
per year per enrollee, from $485.
The average renewal commission for those plans
will increase to $262, from $241.
Medicare Plan Basics
The Medicare Advantage plan program gives
private carriers a chance to provide a subsidized alternative to “Original
Medicare.” About 22 million of the 64 million Medicare enrollees have
Medicare Advantage coverage.
The Medicare drug plan program gives carriers
a chance to sell subsidized prescription drug coverage to Medicare enrollees.
About 20 million Medicare enrollees get drug coverage through Medicare
Advantage plans with prescription benefits, and about 25 million have
stand-alone Part D prescription drug coverage.
Many Medicare enrollees combine Original
Medicare coverage with Medicare supplement insurance, which is also known
as Medigap coverage. About 14 million people have Medigap coverage.
The CMS Medicare plan producer comp
spreadsheets give information only about producer comp in the Medicare
Advantage plan and stand-alone drug plan markets, not the Medigap market.
The spreadsheets show what each plan’s minimum
and maximum initial compensation and renewal compensation levels are, but not
what the actual distribution of compensation payments is, or how easy or
difficult it is for producers to earn the maximum compensation level.
Resources
Links to copies of the CMS Medicare plan
producer compensation spreadsheets are available here.
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