I talked about this last week (see blog post here), but yesterday, Coventry made it official that they are exiting the Private Fee for Service market at the end of 2009. This will affect over 300,000 members including both individual and group PFFS plans.
A relatively small percentage of these members reside in a service area where Coventry offers a Network Based Medicare Advantage product (approximately 40,000 of the 300,000+). These members will be able to elect the Network product during the Annual Enrollment Period (November 15th through December 31st of 2009) for a January 1st, 2010 effective date. They also have the option of electing another Medicare Advantage option in their area or they can return to Original Medicare. If they make no election, they will go back to Original Medicare.
Those members who are affected who have Prescription Drugs included in their Advantra Freedom plan will need to choose an alternate way to get the Medicare Prescription Drug benefit. They can either go with a Stand Alone PDP or they can elect a Medicare Advantage plan which includes prescription drugs.
Is Adantra Freedom going to keep PPO MA in WV, KY OH?
Teresa:
Carelink is leaving West Virginia and Ohio. Health America still has 3 counties in OH. I don’t think they have a CCP in KY.
While Coventry is exiting out of the PFFS plan they do have a PPO available in many areas. These plans are here to stay right now. Most of my clients will actually just roll over to this product which for now is a $0 premium. I will actually receive a new commission for this. The plans are called Advantra Silver $0 premium and Advantra Plantinum with a premium.
Check this out for your current Advantra clients.
[...] Since I blogged on this back on April 4th, 2 more companies have made similar announcements. See Coventry and WellCare blog [...]
Craig,
What companies do you expect will offert PFFS plans in 2010? I heard United Health Care is going to try and dominate the PFFS market in 2010.. I suppose Humana will stick around also..
Mike:
I’ll probably post something on this after the companies file their plans in June. Just my thoughts, not inside information.
Craig
Brenda Jo,
Be careful if you move one of your PFFS customers to a Guaranteed Issue Med supp plan.. I made the mistake of selling a Med supp plan with New Era to a couple that lost their retiree health benefits at the end of last year… They could of actually made it through underwriting which even made me feel worse.. Bottom line is because I sent the med supp app in with a “Guaranteed issue” stamp on it so to speak, it reduced my commission to a one time payment of $50 per app…. I think many of the med supp companies pay nothing or next to nothing on guarantee issue policies… Ask the health questions first before you send it in guarantee issue so you don’t cut your own throat.
Agreed, but I’m not so sure that an Independent Agent can keep doing all of the work (and absorbing most of the expense) for these companies and the government when the regs change daily and live on that kind of comp, so we’ll see what my future planning entails after I know a little more. If MA PPOs are viable this year (not priced so high nor benefits reduced so much that seniors have no real options) I am thinking that most people who were the MA PFFS candidates of the past may enjoy the MA PPOs. I hope at the end of the day, that they keep the senior in mind and I know that the seniors we talk to really want local guidance on all of these changes. AGENTS are PROFESSIONALS and are especially important to this current population and to an industry amidst sweeping changes.
Does this mean we will not receive renewals on all the clients we enrolled?
Yes, Coventry will not be renewing the Advantra Freedom product in 2010, so there will be no renewals paid in 2010. You will continue to receive renewal commissions on a monthly basis for PFFS plans which have been on the books for 13+ months (per your contract) through the end of 2009.
Also, Coventry will stop paying Commissions on new enrollments of Advantra Freedom products beginning with July 1st, effectives. So, if you are talking to people turning 65 in July or later and enrollment in a PFFS plan with Coventry now (for example, for a July 1st, 2009 effective) you will not be paid.
The company will be making an official announcement on this soon.
Craig
I don’t know about all of us, but we took a cut in fyc due to the fact we were going to get more years in renewals and more commission on renewals. Now what happpens? Coventry should be upping the FYC commissions because of this. Agree?
Craig,
With Coventry pulling out of the PFFS business, do those members have a guaranteed right to choose any Medicare Advantage or Medicare Supplement available to them in their area?
George:
Those members will have a guaranteed right to choose Medicare Supplement plans A, B C, and F once they are disenrolled from the Medicare Advantage plan. SInce the plans will be ending on 12/31/2009, the members will be in their AEP and able to choose any Medicare Advantage plan in there service area.
Unless the rules are changed (and these companies) have been making them up as they go, MA applicants are only guaranteed enrollment into the Med Supp plans if this is their first year on an MA plan. Otherwise they will have to qualify for a medicare supplement.
I believe each enrollee has to get a letter 90 days before the end date of their coverage explaining their options and that they do have a right to go back to Med Supp if their MA plan leaves the Medicare Program.
It was never completely clear to me if that meant that the plan had to leave the Medicare Program for all of their products or just the product the beneficiary was on. Also, does it matter that their are other MA plans available in the area (as I believe you also have the right to choose another MA plan; which it will be during AEP so they have that right regardless) and if you had come from a Med Supp originally (whether the 1st year or 3 years ago) whether you were supposed to return to that Med Supp plan if it still exists? If you went from Orig Medicare to MA, then it was definitely any Med Supp but if you came from a Med Supp, I wasn’t sure you could go to any. Seems like you should be able to but with all the certifying that I do, it seems that some companies were wording these protections that people had differently hence my many other questions.
I checked on google and found this type of wording (of course with the current Med Supp changes, this will change some) and then of course my agent question would be WILL THESE MED SUPP GUARANTEED ISSUE situations (when an MA plan pulls out) pay regular commission or will it be a reduced commission?
Guaranteed issue right situation…
Your Medicare Advantage Plan is leaving the Medicare Program, stops giving care in your area, or you move out of the plan’s service area.
You have the right to buy …
Medigap Plan A, B, C, or F, K, or L that is sold in your state by any insurance company. For this right you must switch to the Original Medicare Plan.
When you apply for a Medigap policy…
You can apply up to 60 calendar days before the date your health care coverage will end. You must apply no later than 63 days after your health care coverage ends.
Jim:
All Advantra Freedom members who are disenrolled will be guaranteed issue a Medicare Supplement plan so long as they apply within 63 days of losing their benefits (this translates into approximately the first week of March 2010. They are guaranteed issue into plans A, B, C or F and any pre-existing condition exclusion is waived.
When can we stop selling this product?
You can sell it through the end of May for a June 1st, effective. After that, it will be non-commissionable. Also, I believe any July 1st, effectives you write would be non-commissionable. Coventry will make this official shortly.
Bob:
I e-mailed you a list of the counties. You can also find this on my quote engine, but you would need to put in a zip code and look for an Advantra plan which is an HMO or PPO. Also, here is a link to the Advantra plans website!
http://coventry-medicare.coventryhealthcare.com/explore-our-plans/advantra-plans-hmo-ppo/index.htm
Craig
Where geographically is that service area where Coventry offers a Network Based Medicare Advantage product?