Not really surprising. From the Associated Press...Premiums jump 14 percent on Medicare private plans - Road Runner
- 11,995
I think what's surprising is that number being higher.
- 1,240
In Michigan, we saw 100% - 150% rate increases on some of our more popular MAPD plans. $35 a montn up to $175 a month was very common
- 7,066
You're right, not at all surprising.
I believe we are on the brink of a huge explosion of Medicare Supplement sales in the fourth quarter of this year. I predicted a long time ago that MA plans would not be able to hold the low prices we have seen. The article stated that PFFS plans saw a average increase of 31.2% while HMO's had an increase of 11.3%.
This is only the beginning. There is every indication that increases for 2011 will continue. Those increases may be relatively small compared to what may be coming in the future.
What makes those figures so significant is that the cost of Med Supps are coming down in price. The two new Standardized Plans, M & N, are predicted to be around 60% to 80% of the cost of Plan F with Plan N being the lower priced of the two. (It has doctor co-pays.)
Beginning October 1 agents will be able to show those who have an MA plan that taking Plan N may very well be a much better investment of their premium dollar. (All companies will accept an application with the effective date set three months in advance of the application date.) For literally a few dollars more, possibly less in some cases, a senior can have superior coverage with no network restrictions. October will also coincide with when they begin getting letters announcing the increases for 2011.
I am currently making plans to begin heavily marketing Plan N in metro areas this fall where HMO's have been predominate for the last several years. This may be like walking through a gold field and simply bending over to pick up nuggets.
I believe we are on the brink of a huge explosion of Medicare Supplement sales in the fourth quarter of this year. I predicted a long time ago that MA plans would not be able to hold the low prices we have seen. The article stated that PFFS plans saw a average increase of 31.2% while HMO's had an increase of 11.3%.
This is only the beginning. There is every indication that increases for 2011 will continue. Those increases may be relatively small compared to what may be coming in the future.
What makes those figures so significant is that the cost of Med Supps are coming down in price. The two new Standardized Plans, M & N, are predicted to be around 60% to 80% of the cost of Plan F with Plan N being the lower priced of the two. (It has doctor co-pays.)
Beginning October 1 agents will be able to show those who have an MA plan that taking Plan N may very well be a much better investment of their premium dollar. (All companies will accept an application with the effective date set three months in advance of the application date.) For literally a few dollars more, possibly less in some cases, a senior can have superior coverage with no network restrictions. October will also coincide with when they begin getting letters announcing the increases for 2011.
I am currently making plans to begin heavily marketing Plan N in metro areas this fall where HMO's have been predominate for the last several years. This may be like walking through a gold field and simply bending over to pick up nuggets.
Frank, not that I disagree with your assessment, but we also have to factor in the additional cost of a prescription drug plan since many of these people will be losing their prescription coverage if/when they choose to go back to a Medicare Supplement. While the premium of Plan N may be about the same as their MA-PD, you can't forget to add the cost of a new prescription plan.
Also, I've heard rumors of some carriers making request to CMS to continue to allow PFFS plans in rural areas. If allowed, this could be a game changer for some in the rural areas.
With that said, I can't wait to see the pricing of Plans M & N. If N comes in at about 60% of the cost of F, it should sell pretty well.
Also, I've heard rumors of some carriers making request to CMS to continue to allow PFFS plans in rural areas. If allowed, this could be a game changer for some in the rural areas.
With that said, I can't wait to see the pricing of Plans M & N. If N comes in at about 60% of the cost of F, it should sell pretty well.
- 15,319
No disagreement and I'm waiting to see what the prices might be like for the new plans.
However, not one person mentioned that med supp premiums have also increased annually and I don't think I'd be way off if I guestimated about 12-15%.
Why is it that nobody is complaining about that but only MA plans?
Rick
However, not one person mentioned that med supp premiums have also increased annually and I don't think I'd be way off if I guestimated about 12-15%.
Why is it that nobody is complaining about that but only MA plans?
Rick
- 11,995
According to MIPPA they have the right to do this if there aren't at least 2 network plans in the area.
- 7,066
Because not all Med Supps increase every year especially those that are issue age. Also, if one company has an increase there is almost always another company who's rates are more affordable.
There is no such thing as any kind of health plan that does not have premium increases. Never has been, never will be.
An independent agent will always be able to license with a company who has a better value. This may not be as prevalent with MA companies. Plus, the agent can count on getting paid by Med Supp companies. An issue that has been of great concern to agents selling MA plans.
I agree, but for most of those I've helped exit MAPDs they ability to pick the PDP that best fits their drug usage makes it a non-issue. For one lady the savings in the drug copays paid for over half her premiums for the supplement. Thats one of the bad pts of the MAPDs... the client is stuck with the drug benefit as a hard benefit of the plan. No shopping around.
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- 1,240
I'm starting to get emails from FMO's about Plan N and M, it sounds like next week we should start seeing what the premiums will actually be...should be interesting
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