by Brett Arends
Hard-sell Tactics Target People with Lower Incomes in Particular
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It’s probably just coincidence that the AEP (aka Medicare open enrollment) happens to coincide with traditional hunting season. But it sure doesn’t feel like it.
A new study shows how senior citizens are being effectively hunted by ruthless private insurance companies and brokers during the AEP, which runs from October 15 to December 7.
Aggressive marketing operations, comparable to infamous Wall Street “boiler rooms,” are subjecting people to a hard sell to try to get them to switch to a private Medicare advantage plan.
This includes torrents of cold calls, which are expressly forbidden under Medicare regulations, and offers of “time sensitive” deals and discounts that are actually illegal.
Three quarters of senior citizens say they received cold calls trying to get them to switch to a Medicare Advantage plan during last year’s AEP, according to a groundbreaking survey conducted by the Commonwealth Fund, a nonpartisan think-tank.
Half of those surveyed, or 51%, told researchers that on these cold calls, the caller falsely claimed to be from Medicare.
“America’s seniors and people with disabilities … should be protected from bad actors who engage in misleading advertising and marketing tactics,” said Dave Allen, a spokesman for America’s Health Insurance Plans, the trade association and lobby group that represents private-sector insurers, in a statement. “Health insurance providers strongly agree: Americans should have clear, accurate, easy-to-understand information about Medicare advantage plans, so they know what they are buying.”
Allen added that the industry will be subject to tougher regulations this year. “AHIP will continue to engage with [the federal Centers for Medicare and Medicaid Services] and other stakeholders to assess Medicare marketing requirements including addressing certain elements to ensure they do not hamper the ability of agents and brokers to assist Medicare enrollees in choosing the best coverage option for them,” he said.
Medicare Advantage, in which Medicare is outsourced to for-profit insurance companies, is big business. It has been growing rapidly for more than a decade and this year for the first time exceeded the size of traditional, government-run Medicare. Last year, taxpayers paid Medicare Advantage insurers just over $400 billion, in addition to money paid through the Medicare Part D prescription-drug program, according to the government’s Medical Payment Advisory Commission.
Hard-sell tactics are being focused especially on seniors with lower incomes, the Commonwealth Fund reports. Those with incomes of less than $25,000 a year were twice as likely as those with higher incomes to be asked for their Social Security or Medicare numbers before being given any plan details, the survey reports. That’s against Medicare rules, Jacobson noted. And 28% of those with lower incomes said they’d been exposed to marketing or advertising that claimed something about a private Medicare Advantage plan that they later found out wasn’t true — a much higher percentage than among other income groups.
Jacobson said people with low incomes are often especially profitable to Medicare Advantage providers, because they are eligible for both Medicaid and Medicare.
Seniors are struggling with the bewildering complexity of the Medicare program as well as hard-sell tactics. MedPac reports that last year, Medicare Advantage included 5,261 plan options offered by 182 organizations. According to the survey, the choice is so overwhelming that many seniors choose to simply stay with their existing plan.
My Comments: Every year Medicare advantage agent/brokers must complete an annual recertification. Included in this training is Medicare’s myriad of marketing rules, and one of them is that COLD CALLING is prohibited! And it has been prohibited since the dawn of Medicare advantage plans. The tele-marketers blatantly ignore these rules.
If you receive a cold call from a tele-marketer, you can do the following.
- Some people screen all calls before picking up. They only pick up calls from family and friends.
- Others have a recording that tells the tele-marketer to hang up and put them on their do not call list.
If you pick up and start hearing the obvious tele-marketing spiel, you can do the following:
- Hang up immediately.
- Tell the caller you have an agent, say good-bye, and disconnect the call.
- Ask the tele-marketer for her/his name, phone number, and insurance license number of the state you’re in. Suggest that you will report him/her to your state insurance department for making illegal tele-marketing calls.
- Take the info as above and tell the caller you’ll get back with him after checking him out.
- Whatever you do, take control of the conversation by refusing to answer ANY questions about your current coverage. If a stranger calls you and asks how much money you make, how much you have in your checking account and other personal details, do you answer him? I hope not. Likewise, don’t give them any information such as what plan you have, your Social Security, Medicare, or bank account numbers. Be a brick wall and find out how fast the tele-marketer flies the coop.
There are two things to remember. Medicare or the Social Security Administration never calls you. They communicate via U.S. Postal mail. Lastly, these boiler room tele-marketers are 100% commission chasers. If they screw up your plans and cause you grief, they could care less.