Where Do We Go From Here?

After months of debate in Washington, healthcare reform is finally a reality! What does that mean to insurance agencies? Is it a good thing? Is it a bad thing? Is it a mixed bag? From my perspective, healthcare reform is often a GREAT thing. Healthcare reform focuses on major medical insurance - not life insurance, voluntary benefits, or Medicare Supplements.

Voluntary Benefits and Employers
Voluntary benefit sales should continue to expand and not just for small businesses. Employers continue dropping insurance sponsored coverage for workers at an alarming rate. Many large companies and corporations have experienced steadily rising insurance premiums over the past ten years as medical costs have grown. As part of healthcare reform, employers with fifty or more workers will face government fines if they do not provide their employees with insurance coverage. A recent online article noted several major corporations that are considering dropping employer-sponsored health coverage in exchange for paying penalty fees to the government. If the price of providing employer-sponsored medical insurance for their employees is larger than the total amount on the fine, what choice do they have? They eliminate their employer-sponsored coverage, pay the federal government fine, and come out ahead financially. But, where does that leave their employees? Without benefits!

Since many employers feel a moral, if not just a legal, obligation to provide benefits for their employees, they should turn to giving employees access to voluntary benefits. Worksite may easily become the golden child in the insurance industry.

The Future of Medicare Supplement Sales
I think healthcare reform will very positively affect Medicare Supplement sales for years to come. Beginning in 2011, federal payments to Medicare Advantage plans are going to be substantially cut, and cuts will continue in the coming years. That step will cause more insurers to withdraw from the Medicare Advantage marketplace. More Seniors will lose their coverage and return to Original Medicare and purchase a conventional Medicare Supplement.

Of course, Baby Boomers’ retirements will have a profound effect on Medicare Supplement sales for decades. According to the U.S. Census Bureau, by 2030 the 65-plus population will double to about 71.5 million, and by 2050 it's going to grow to 86.7 million. That represents massive numbers of potential Medicare Supplement sales!

Because today’s retirees are more educated than the ones from previous generations, they've a greater understanding of what Medicare does and doesn’t cover. They understand the necessity to plan for their future and the value a high quality Medicare Supplement could have once they confront health issues. They also have more than adequate disposable income to afford a high quality Medicare Supplement.

Some areas of healthcare reform won’t go into effect until 2014, and even then, there will be out-of-pocket expenses that traditional major medical plans will never cover. Supplemental insurance protection will always be important to a person’s overall healthcare planning. Cancer and critical illness policies will continue to grow in popularity given the vast amount of media attention focused on cancer and critical illnesses like heart disease and stroke. With a continued increase in obesity, shown to becoming a precursor of these kinds of health issues, the value of cancer and critical illness policies will become more obvious with each passing year. In addition, individuals who may choose not to get any kind of basic or extended supplemental health coverage could still be receptive towards a lump-sum cancer or critical illness policy.

What does healthcare reform mean to us? OPPORTUNITY! The future looks intense - especially for life, worksite, and Medicare Supplement sales. But, we require more talented Agents with us during the coming months to handle the ever-increasing workload. As a result of impending commission changes in the major medical marketplaces and in Medicare Advantage, you will have the option of a bigger and versed pool of Agents. Reap the benefits of that. Continue recruiting. Continue training. Make the most of the amazing potential around you in terms of both people and products!