8 Strategies to Prevent Rapid Disenrollments from Medicare Plans

No Medicare agent wants to hear they’ve had a rapid disenrollment. Not only can these feel like a slap in the face after all your hard work, but they can also have negative consequences, especially if your book of business shows quite a few of them.

Luckily, there are ways you can prevent them.

What Are Rapid Disenrollments?

In industry lingo, a Medicare rapid disenrollment is generally when one of your clients, who you recently helped enroll into a Medicare plan, decides to disenroll from their Medicare Advantage plan or Part D prescription drug plan within three months of their enrollment or before their enrollment is final. This could be a plan you helped them enroll in during the Annual Enrollment Period (October 15 to December 7). The rapid disenrollment would then occur during the Medicare Advantage Open Enrollment Period (January 1 to March 31).

There are some exceptions that apply, like if your client moves out of their plan’s service area or becomes dual-eligible. You can read more about them in the Medicare Advantage & Part D Communication Requirements.

How Do They Affect You and Your Commission?

When a client is considered a rapid disenrollment from a plan, the carrier must recover the commission they paid you for the sale in the form of a chargeback. Rapid disenrollments not only affect your bottom line, but also your reputation in the eyes of the carrier and even the Centers for Medicare & Medicaid Services (CMS).

If you have a high rapid Medicare disenrollment rate, you may run into compliance issues. This is because the carrier and CMS may think you’re trying to enroll individuals into plans for the wrong reasons (e.g., the commission) versus the right ones (e.g., what’s in their best interests). Additionally, client dissatisfaction could lead them filing a grievance against you.

When a client is considered a rapid disenrollment from a plan, the carrier must recover the commission they paid you for the sale in the form of a chargeback.

Strategies for Preventing Rapid Disenrollments

If you’re the stand-up agent we know you are, you shouldn’t have anything to worry about. It’s unlikely you’ll have that many rapid disenrollments if you’re following Medicare sales best practices and CMS’ compliance rules and regulations. However, if you want to play it safe or find the number of your clients disenrolling from the new plans you just put them in increasing, it’s important to know how you can prevent Medicare rapid disenrollments.

We’ve listed some strategies below, but remember, these are actions you should take during or after each and every appointment anyway!

1. Fact Find Thoroughly to Learn Your Client’s Needs

One reason a client may disenroll quickly from a plan is if they discover the plan isn’t actually the right fit. Make sure you’re finding out your client’s health needs, budget, lifestyle, and preferences before recommending a plan. Consider using our fact finder sheet to lead your conversation. The more information you can gather, the more nuanced your plan recommendation can be.

Then, when you present a plan, make direct correlations to their unique situation. For example:

• “You mentioned you travel across the country often. This PPO plan doesn’t have as many network restrictions.”
• “This $0-premium plan will be nice on your limited monthly budget but still affordable since you have some savings for out-of-pocket expenses.”
• “This Special Needs Plan will cover those ongoing costs you have to manage your chronic condition.”

Do your homework and fact find thoroughly so you can present some solid options to your client.

2. Make Sure Your Client’s Providers Are in Network

Many people want to continue seeing the same doctor they’ve been going to for years. If they find out their beloved primary care physician isn’t in network, it could cause them to rapidly disenroll from their new plan.

At appointments, check if your client has any preferences regarding their physicians or hospitals. If they do, confirm those providers are in network via the plans’ online directory. Paper directories can change over time, so using online directories is best.

Paper directories can change over time, so using online directories is best.

3. Check That Their Prescriptions Are (Well-Placed) in the Formulary

Medications can cost Medicare beneficiaries hundreds to thousands of dollars depending on the prescription drug. While meeting with a client, you’ll want to gather a list of all their prescription medications and make sure they’re in their plan options’ formularies. Otherwise, your client’s prescription won’t be covered, and your client will have to pay the full amount.

Also consider where their medications are placed in those formularies, as the higher the tier a drug is categorized in a formulary, the more money the drug will likely cost the policyholder. Don’t forget to check which pharmacy they’d like to go to and if it’s considered a preferred one by their plan!

4. Ensure They’re Comfortable with the Costs & Benefits of Their Plan

Speaking of costs, it’s extremely important to make sure that your clients are comfortable with what they’ll have to pay for medical items and services on their plan. This includes their monthly premiums, deductible, copays, coinsurance, prescription drug costs, durable medical equipment, etc. Nobody wants to feel like they were sold something they didn’t understand the true price of.

It may seem obvious but check and double-check that your client understands all the benefits they’re entitled to and the ones they’re not.

Additionally, it may seem obvious but check and double-check that your client understands all the benefits they’re entitled to, and the ones they’re not. If they wanted a plan with certain dental, vision, and hearing benefits or OTC benefit and their new plan doesn’t include those items, they could feel that you misguided them.

You may have also missed an opportunity to cross-sell an affordable ancillary plan to cover those items not available with the plans in their area. Just make sure you’re following compliance rules during an MA/PDP appointment and only sell ancillary plans that are listed and checked on the Scope of Appointment (i.e., Medicare Supplements, hospital indemnity, and DVH products). Non-health products, like annuities and life insurance, must be presented during separate follow-up meetings.

5. Go Over All Their Options, Even the Less Expensive Ones You May Not Offer

If the plan you recommended isn’t the least expensive one available to your client, you likely have reasons why it’s still what you think is the right fit for them. However, many Medicare beneficiaries live on a fixed income. And, if they hear from a friend, a family member, or another agent that there’s a more cost-effective option out there, they may decide to switch to that if they can.

Before enrolling a client in a plan, it could be wise to let them know that there are other, less costly plans out there (if that’s true). Then, explain to them why you think the plan you’d recommend better suits their specific situation.

6. Review the Outbound Education and Verification Process with Them

Some rapid disenrollments occur because of carriers’ outbound education and verification (OEV) calls. The client may decide to disenroll from their new plan at this time because they’re confused about their benefits or what they’re being asked to do during the call. Before you leave your appointment, let your client know about this upcoming call and what to expect during it.

Before you leave your appointment, let your client know about this upcoming call and what to expect during it.

7. Follow Up and Let Them Know You’re Available to Address Any Questions or Concerns

Your client will probably feel more comfortable with their plan choice if they fully understand it. If they develop questions or concerns, it can shake that comfort. It’s better for you to address any hesitations they may have because you (should) understand your client’s wants, needs, and budget.

If they talk to the carrier or another agent, their faith in you and their plan could be shaken or even destroyed, possibly for the wrong reasons. Stay out in front of potentially bad situations by checking in with your clients to see how they like their new plan and asking if they have any questions or concerns. Make sure they know when and how to best reach you!

8. Be an Agent Who Cares, Not One Who Just Wants to Earn Commissions

When you sell Medicare plans, it’s important that you help clients into the plans that are in their best interests, not yours. Even if you think you’ve done that, people’s feelings, and their needs, wants, and budgets, change. And sometimes, they can change fast.

If your client isn’t happy with their new plan, do the right thing and help them switch plans if they need to and still can. Don’t forget about Special Enrollment Periods, such as the 5-Star MA Plan SEP or MA Emergency-Related SEPs, the MA OEP, and MA trial rights. You may not have found the right plan on the first try, but they may end up trusting you even more for working with them after the fact.

Not only are these strategies essential for your insurance business in general, but also important for reducing the chances that your client will become just another rapid disenrollment statistic. Just be that caring, thorough, intentional agent we know you are, and you’ll be fine!

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