Extra secret comp for MA plans?
- Thread starter MedicareWAA
- Start date
Bill, please continue the story here. Do the agents just get a lump sum that they can do whatever they want with it or does it have to be accounted for, not only by the FMO, but by the agent as well?
Todd it depends on the fmo and level of business the agent is doing . I’d say the vast majority of Fmo’s are giving a co-op share from 50% up . If your doing 150 apps up a yr I’d insist on 100% paid by the fmo plus some carriers will also give heavy producing agents Co-op money and nic nacks . For instance I get 100’s of pens , stress balls and masks from Humana . A big hitter should be getting $10 k or more from his fmo for aep . But to get that you must commit to 100 aep.
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To make sure I'm being clear, this pertains to Medicare Advantage and Prescription Drug Plan business. The compliance rules impact these lines far differently than MedSupp or others.
Some of this depends on the carrier who may be involved, if any. We have carriers that demand strict detail down to the granular level on these programs. Others do not.
Beyond that, there are different processes that we follow for compliance depending on Agency vs Individual Agent. This isn't our preference, but our way of ensuring we aren't violating Compensation Rules in the CMS marketing guidelines.
If it is an Agency, we generally don't need a breakout with receipts but we like to have a relatively fleshed out business plan to understand the ways in which the dollars will be spent. We're not required to have it, but it helps to have everyone on the same page in terms of objectives/costs/methods in order to determine if the spend worked or not.
If it is an Individual Agent, the process is much different. We need to have either evidence of the spend in order to reimburse at the agreed upon amount/percentage, or we need to have a vendor (Lead Concepts does this for us as an example) who we can pay directly and will drop the mailing once the Agent has paid their portion. If we sent the Agent a check without any of the corresponding detail, it could be construed as "Compensation" and we could be at risk.
We can pay 100% of a mailing/event/service for an Agent. However, we can't send them a check for the amount.
We haven't ever faced an audit from CMS, but I know FMO's that have. We handle things this way so that if in the event we ever face an audit we are 100% compliant with the Compensation guidelines.
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When Todd gave me 50k I have to give him a kidney.. when I didn't meet the sales expectations, he kept it.
And I thank you for that! Having that 3rd kidney allows me to sleep during the night!
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