Picture this: You have a client outside your office, pacing the floor. He’s about to turn 65, and wants your advice on whether to enroll in Medicare Part D, the new government-subsidized prescription drug benefit program offered through private health insurance plans.
You know the meeting may be a bit of a challenge, especially when you consider all the negative press that surrounded the plan’s last deadline of May 15 (that date was set for individuals who turned 65 before then). The New York Times, for one, had quoted a retired chemist as saying, “I have a Ph.D., and [the plan is] too complicated to suit me.” And The Record in New Jersey ran an editorial cartoon that suggested even Einstein would be hard-pressed to understand its ins and outs. As your client takes a seat before you, you know that you have to simplify the process. But how?
|Medicare Part D Resources|
If you’re looking for more ways to get educated about Medicare Part D, the Association of Health Insurance Advisors recommends the following online resources:
Dick Harlow, CLU, CSA, managing partner of the Harlow Group in Reston, Va., as well as past president of AHIA, faces situations like this every week. He has this advice for advisors: Relax. Reports of Medicare Part D’s complexity have been greatly exaggerated. Or, as he puts it, the reports are “baloney.” “There’s really nothing complicated at all about it,” says Harlow, a Virginia AIFA member who has more than 1,500 individual and 300 group clients. By and large, the public appears to feel the same about the drug benefit, which began last January. The Centers for Medicare and Medicaid Services says that 38.2 million, or 90 percent of the total eligible population, had enrolled by May 15. Another study, by the marketing research firm DSS Research, found that most seniors are satisfied with their Medicare Part D coverage. Here’s how Harlow walks his clients through Medicare Part D, and ensures that they leave his office happy and informed.
Three easy steps
Step 1: First, Harlow advises that you ask your client, “When you turn 65, other than Social Security, will you have prescription drug coverage either through your current or former employer?” If your client says yes, and the coverage is creditable—meaning equal to or better than anything offered under Medicare—conclude the talk with, “If in the future, you lose your creditable coverage, contact me right away and we’ll talk about Part D.”
Step 2: If your client does not have creditable coverage, Part D may be a good fit now. Ask him, “Are you taking any prescription drugs?” Even if he says that he’s not, Harlow suggests that you advise him to sign up for Part D. That way, your client will avoid late enrollment penalties (1 percent for every month after the age of 65) come the day he finally needs prescription drug coverage. In the meantime, the client can stay in the Part D loop by buying one of the least expensive plans. (For example, Humana’s basic plan in Virginia is less than $10 a month.)
Step 3: If your client does not have creditable coverage and is taking prescription drugs, ask him for a list of these prescription drugs. Harlow takes the list, goes onto health insurance websites, such as Anthem and Mutual of Omaha, and sees if the drugs are covered under any of those health plans. “Once we match them up with a company that covers all their drugs, that’s the recommendation we’ll make,” says Harlow. He adds that the process often takes no more than 15 minutes, from beginning to end. “That’s it—it’s that simple,” he says.
And while the commission may be meager—as little as $50 for each product sold—the process is well worth it, for the advisor and his client. After all, says Harlow, “Good service equals retention of business.”