What Do You Do Now?

Inaccurate Confusion

A news article covering the impact of the Massachusetts Mandatory Health Plan was quoted as follows:

"Many people are looking for Masshealth insurance quotes online. Online health insurance quotes remove the middle man (your agent) and so reduce the costs of Masshealth insurance for you as an individual and for your family." 

The cost savings are Not true, but the article is reflective of the uncertainty and misinformation that was prevalent when Massachusetts passed their health care legislation.

So what do you do now that there is a National Mandatory Health Plan?

For those of you who are actively writing individual health, we anticipate that this market will be dominated by the insurance exchanges and Medicare (as they come into play) with a focus by the carriers toward on line sales.  There will still be a market, but it will be critical to have a website with the ability to link to carrier quote engines.  Marketing will be focused not on face to face meetings, but motivating potential clients to visit your website for both individual health and to expand your sales of other products such as life and ancillary. 

Size Does Matter

Contrary to the fears of many, we believe small group (under 25) is going to remain a strong market for agents.   Although there will be some loss to the exchanges, the market will expand from it's present base as more companies offer coverage to their employees.  

AMG believes that in this market, much like the experience in Massachusetts, small business clients will look to their brokers for guidance in plan choice and support after the sale. Remember that the cost for coverage is the same when purchasing directly from a carrier or purchasing though an agent.  Unknown at this time is the impact on compensation as Health Insurance Carriers attempt to control costs and maintain profitability.

We see the impact on Large Groups as mixed.  There will be employers who choose to pay the tax penalties as the lesser of two evils when compared to the cost of providing medical coverage to their employees.  The management of other companies will offer coverage even when the cost is greater as a way of recruiting and retaining a better work force.  The size of the company, management attitude and the industry of the business will all have impact making it critical that as agents you "Know Your Market".

Some Things Don't Change

The one market segment that is not directly affected by Health Care Reform is Worksite Products.  These ancillary offerings will continue to grow as health care reform is defined and implemented.  Agents looking to expand their service and grow their business should look at carriers such as Colonial and Conseco  (we have both at AMG) for products and knowledge.

Will Section 125 Become More Important to Group Sales?

Having a Section 125 plan is mandated for employers with 11 or more employees under the Masshealth law as a way of controlling costs.   We at AMG believe that Section 125 will see an upswing in interest under the new National Health Care Bill for the same reason.

A Section 125 Cafeteria Plan reduces the amount of taxes both an employer and employee pays. It also reduces the employee's gross income. So let's say an employee is paid $1500 per month (pretax/ pre-withholding) at their job. Their health insurance premium through work is $300 per month and the employee puts that $300 dollars into a 125 Cafeteria Plan to pay for their premium. The taxable income for that month is reduced from $1500 to $1200 for both the employee and employer.

This also means as an employer you save on your payroll taxes if your employees do take advantage of a Section 125 Cafeteria Plan. By reducing an employee's gross pay, their employer pays less social security, Medicaid, worker's comp, and unemployment taxes for that worker. The employee saves on their income taxes and their take home pay may increased due to their gross income being decreased to a lower tax bracket, thus causing less taxes to be withheld. Short term this may seem like a great thing for the employee.

Contact Angela Moore or Heather Matias for more information.

At AMG We've Got Everything You Need In One Place

Seven Steps To GuaranteeSuccess

This PowerPoint was originally developed by Jan Pinney to assist agents in making the Million Dollar Round Table.  It has been modified to apply those same principals for a track for success in our career without regard to product line.  It is well worth the few minutes it takes to see it.

Website Marketing

As mentioned earlier, a website presence is going to be more critical to agents as a result of the new Health Care Bill.  If you don't have a site or the site you have is limited to providing contact information, now is the time to move forward in developing a system to compliment your marketing and personal relationship business. 

At AMG we assist our select partner brokers in developing a website; setting up links to provide quoting capabilities on life and health along with marketing tools to motivate potential clients to visit and use your website for their insurance purchases. 

See a preview of the various styles of website offered by AMG by Clicking Here. In addition you should visit the AMG website to learn about CLQ the Consumer Life Quote Engine and the EZ Life Sales system.

For additional assistance contact Ed Massey via email or at 713.977.0611