Countdown to cms final ruling

[sshafran]

No the $642 includes “$31” extra . That means the agent gets $611 and the fmo gets $31 . But But But any company can break up that $642 any way they want want. Before there was max comp of $611 and any amount of administrative fee( a fancy word for fmo overrides and marketing money ) . So the strongest carriers could bully the small weak carriers and pay much more overrides to “steer” business to the large carriers . Cms is saying no no . We’re leveling the playing field at $611 plus $31 for ALL carriers . This is so agents and fmo will have no financial incentive to “steer” business . But the truth is if agents don’t sell the best plan they’ll be replaced .

I still have not see it spelled out that way - I've seen it as agent gets 642.

But just hearsay.

Do you have a legit source?

 

[GoPokes]

I still have not see it spelled out that way - I've seen it as agent gets 642.

But just hearsay.

Do you have a legit source?

I think I have found the root of the confusion and the hearsay.

There are many summaries of the proposal, on various websites. Some summaries will say the $31 is a payment to the FMO, whereas others describe the total payment of $642 to the agent.

I found the full text of the proposal on the federal register. I read part which is pertinent to our conversation, and found it to be much more helpful than any of the summaries. It is very thorough, clearly laying the problems observed, possible solutions proposed. It is also clear that they are seeking further comment on the proposal.

(Ill present my thoughts; and then link to the text in the register)

Pages 78,552-78,556... starting here:
Agent Broker Compensation

They want to eliminate the possibility of incentives for volume enrollment in an MA carrier. It doesnt explicitly say "marketing dollars" but reading between the lines, that's what it looks like.

Limitation On Contract Terms

They do describe the increase in compensation, adding the $31 to the current FMV of $611. The $31 is necessary to cover costs such as training, testing, and call recording. It doesnt really say anything about paying it to the FMO, but rather, adding it to the FMV agent compensation, bringing it to a total of $642; to be assessed annually, and adjusted accordingly.

It looks like they certainly want to eliminate any possible incentives that may exist now, to steer enrollment towards one MA organization, over another. They are aware that national carriers have an advantage over smaller regional carriers, with these marketing dollars.

As it is proposed, it doesnt appear that there is much meat ($$$) left on the bone, if any, for the FMO, especially if the carriers are paying agents directly.

Compensation Adjustment

It goes on to propose the same adjustments in compensation ($31) be added to PDP enrollments, so as to prevent conflicts of interest.

I would encourage them to propose these commissions not only be the maximum, but also the minimum, for all MA plans.

As carriers have the freedom to make non commissionable plans, this introduces the "steering" problems they seek to avoid.

Overall, I think it's difficult for seasoned agents to fully identify the value the FMO's provide. Obviously some are doing more than others for their agents, similar to how some agents provide more value to clients than others. But, more than likely we used them a lot more in the early days. Similar to how our clients might not fully remember how much help we were to them a few years ago, when they were first enrolling into medicare.

One perk of the FMO's having interests aligned with agents, is their ability to lobby in our favor, to make sure we are heard. They have the finances to do so, and up until now, we have been in this together.

If there is a time in the future, when agents are on the other side of this... if there is a proposal to remove the agents from the picture, removing all commissions, or reducing them, im afraid there won't be a unified front from the independent brokers across the country, representing our value add.

 

[selfgen]

By Next Monday we’ll know if overrides ,marketing money and Hra’s gone . I found it interesting yesterday wellcare sent out email lowering Hra’s from $225 to $150 on dsnps and no more money on non dsnp Hra’s . Also wellcare was paying hra fee’s immediately like Aetna before the plan went in effect . That’s gone .Now they pay on effective date . They mentioned persistency. Basically agents were gaming the system on dsnps . They’d write on March 1st get the $225 and rewrite on March 18th new carrier for April 1 effective date

It’s April 9th. I talked to my FMO today and he claims it’s NOT finalized yet. He says it’s not official as of yet.
Is he just in denial? Is it just wishful thinking on his part? Everyone on this board is telling me it’s a law now.

 

[Yagents]

How it effects fmo's is still up for interpretation with hundreds of pages of legal mumbo jumbo to go thru