Should You Go with a Medicare Broker?
How can you be sure that an insurance salesman is being honest with you? Talk to a broker instead of a corporate representative. Because Medicare brokers work for many different insurance companies, they can try to find the right fit for you rather than pushing one carrier. Your Medicare broker will be able to review all options available and search for a plan that most closely fits your individual needs and budget.
Medicare brokers, also known as independent Medicare insurance agents, are paid by the insurance companies they represent. There's no extra fee or cost for enrolling through a broker. The broker's commission is included in your premium.
Benefits of working with a Medicare insurance broker:
- The brokers have collective data about insurance carriers that you may not have access to, like rate trends.
- The agents offer a variety of plans, so their recommendations are unbiased.
The field is regulated to protect the consumer. It's against the law for insurance agents to make false or misleading statements to scare you into applying for coverage with a certain plan. Similarly, agents aren't allowed to come to your home to promote or sell any Medicare-related product without being invited by you to do so. They also cannot legally charge you a fee to process your enrollment. By the same token, it's illegal for agents to offer a free item or other incentive, such as inviting you to a Medicare plan seminar at a restaurant, to entice you to apply for coverage.
Keep an eye out for brokers who violate those laws. While most agents are trustworthy and well-informed, scam artists exist. Before meeting with an agent, take time to ensure that he or she is licensed and has a relatively complaint-free history. You can visit your state's department of insurance website.
Know the red flags
You should be alarmed if your plan agent doesn't tell you all your options. A good broker will let you know the best option even if he or she doesn't represent the plan. Your Medicare broker should:
- Make sure your doctors and medications are covered in the plan.
- Advise you of your best option regardless of whether the broker represents a certain plan.
- Know the federal and state programs available to help people with financial limitations.
Generally, brokers receive an initial payment for the first year of the policy and half as much for year two and beyond if you remain enrolled in the plan. There's annual training to complete and tests to pass on their knowledge of Medicare and health and prescription drug plans as well as on Medicare marketing rules. They face the risk of loss of licensure with their state and termination by their contracted health or drug plans if they don't comply with the rules related to selling to and enrolling Medicare beneficiaries in Medicare plans.
You can get information about your Medicare coverage via Medicare.gov or by calling the Medicare hotline at 800-MEDICARE or 800-633-4227. You also can find websites that help you find agent compensation information about the plan or plans you're interested in. CMS.gov offers agent compensation data. CMS.gov is a federal government website managed and paid for by the U.S. Centers for Medicare and Medicaid Services.