Recently, Craig Ritter gave his annual State of the Senior Market address to 290 agents from across the country.

If you’d like a quick summary, here are some of the highlights:

Ritter Year in Review

Yearly Numbers

Our annual Medicare Supplement sales were down by 3% in 2017, Medicare Advantage sales increased by 26%, and Medicare Part D sales increased by 22%.

Annual Enrollment Period

MA enrollments during AEP were up 13% when excluding “disrupted” applications from the prior AEP, Medicare Part D enrollments were up 20%, and Med Supp enrollments were up 15%.

Here’s What’s Happening in the Office

We’ve had some office and staffing increases that we’re excited to share! More employees mean more support for agents, as well as improved services:

  • Our staff increased by 19 employees, giving us a new total of 160 full-time employees!
  • We now have a three-building campus in Harrisburg, and regional offices in Atlanta, Scottsdale, New York, Omaha, and Nampa, Idaho.
  • (Drum roll…) we also recently acquired a new building in Harrisburg to meet our goal of bringing our operations back under a single roof. More space means more growth and opportunities! Our projected move-in date is the end of Q1 in 2019.

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We’ve continued to grow our company relationships to provide a better experience for clients and agents alike.

  • In terms of Medicare Advantage contracts, we now have HealthNow (BCBS of WNY and BS of NENY) and Centene (Allwell)
  • We’ve also terminated several Medicare Advantage contracts, including
    • Gateway Healthplan
    • Scott & White Health Plan
    • University of Maryland Health Advantage
  • These changes bring our existing MA and PDP contracts to 41
  • In terms of Med Supps, we’ve been adding carriers more selectively. In 2017, we added Americo, and terminated Heartland

Enrollment Stats for 2017 & AEP Review

  • Individual Medicare Advantage enrollment has been consistent since 2016, with a 7% growth last year
  • 2017 saw a 1% growth in individual PDP enrollment
  • Employer plans grew by 6% this past year
  • Big winners for MA parent growth included:
    • UnitedHealthcare: up 5.7% since last AEP and up 13.9% year over year
    • Humana: up 4.5% since last AEP and up 5.3% year over year
    • Aetna: up 6.2% since last AEP and up 12.7% year over year
  • Our top seven PDP carriers now represent 89.6% of the individual PDP market!

The Medicare industry is constantly evolving and changing! Here are the top industry trends to keep an eye on in the coming year:

Medicare Advantage

  • High persistency and low churn
  • Concentration of business among top players
    • Top 10 plans have 70% of Medicare Advantage members
    • Top 10 plans grew 1.1 million members, while the rest grew only 65,000
  • CVS Health (SilverScript) and Aetna made news by announcing a merger
  • Anthem acquired two MA plans in Florida
    • America’s 1st Choice – 130,000 members in 25 counties
    • HealthSun – 40,000 members in two counties
  • WellCare completed acquisition of Universal American and passed Cigna in membership rank

PDP

  • The top 5 PDP carriers control 84% of the market
  • The industry is seeing mostly plan changes versus new growth
  • The annual trend of drastically increasing deductibles in Part D was quelled in 2018
    • The standard annual deductible went up just $5 to $405
  • Virtually all major Part D plans include the Preferred Pharmacy feature with striking cost-sharing differences

Medicare Supplement

  • We’re seeing a continued focus on Plan G, with a slightly higher interest in Med Supp plans overall
  • Top Med Supp carriers seeing the most action are UnitedHealthcare/AARP, Aetna, Cigna, and Mutual of Omaha

Changes in Washington

Things continue to change where health care is concerned, and Medicare is no exception. Here’s what to look out for in the coming year and beyond.

  • Changes in the 2018 Medicare Marketing Guidelines were huge for agents, with tweaks to the Scope of Appointment, educational and marketing events, and Electronic Communication Policy
  • The Bipartisan Budget Act of 2018 will bring some positive changes to most Medicare beneficiaries
    • An end to the Part D coverage gap on January 1, 2019 – a year earlier than planned
    • Permanent extension of Special Needs Plans
    • New Part B and Part D Premiums bracket for clients with high incomes
  • The Extender Bill will implement a one-year holiday for “HIT” tax and a two-year delay for “Cadillac” excise tax
  • The 2019 Advance Notice proposes a 1.84% increase in MA reimbursement rates
    • The proposal is high relative to prior years — 0.45% in 2018, 0.85% in 2017, 1.25% in 2016 — and bodes well for Medicare Advantage plan stability in 2019

Regulatory Happenings

Where Medicare’s concerned, there are a few proposed changes in the works. Here’s an overview:

  • 2018 Proposed Rule Making includes:
    • Restoration of Open Enrollment Period (OEP) in 2019
      • Would run from January 1 to March 31
      • “Marketing” would be prohibited during this period
        • We’re waiting for further explanation on what exactly this entails
    • Uniformity of benefits
    • Elimination of “Meaningful Differences”
    • Revisions to Communication/Marketing Guidelines
    • Change to Broker/Agent Requirements
    • FMO/Agency Oversight, or First Tier Downstream Related Entity Audits (FDR Audits)
  • Medicare Supplements will see changes due to the prohibition on sale of Plans C and F in 2020
    • We’re already seeing a greater emphasis put on Plan G as an alternative to Plan F
  • New Medicare cards using the Medicare Beneficiary Identifier (MBI) will be sent out in waves this year
    • These cards will be the only ones accepted beginning January 1, 2020

In 2018 and Beyond

In his State of the Senior Market address, Craig Ritter doesn’t just look back – he looks ahead too. Here are some things to look forward to in 2018 and beyond.

The National Association of Health Underwriters (NAHU) is moving to make a few changes in Washington, D.C., including:

  • Fixing the COBRA trap
  • Modifying the Two-Midnight Rule, which will move claims from Part A to Part B, and would allow “observation days” to be counted toward the mandatory 3-day hospital stay for skilled nursing facilities
  • Medical Loss Ratio & “Broker Bill” would eliminate use of Scope of Appointment, the “Proration” of Initial Commissions for PPH, and would allow brokers to call insurers on behalf of clients

Thanks for keeping up with Ritter! If you have any feedback or questions, call us at 800-769-1847.