Is the New 2025 CMS Rule for Agent compensation actually GREAT news for AGENTS and FMOs?

[InsuranceGuy29]

This came out a little after 2 this afternoon which doesn't sound promising.

[EXTERNAL LINK] - Humana Withdraws Its Already Lowered 2025 Profit Guidance - Humana (NYSE:HUM)

The problem with Humana is they have leaned far too hard into HMO's, with Medicare Advantage. They do have a few PPO's, but they are very weak when compared to most other competitors.

Humana has always been known for their Gold Plus HMO and their HMO Chronic Condition D-SNP, at least in my region.

Problem is, PPO's came on the market about 6 years ago, and enrollment and broker and Medicare recipient sentiment has trended HARD to PPO's.

Their HMO's are good, but if I meet with 50 clients nowadays, 35-40 of them are basically demanding a PPO, immediately. And I cannot blame them.

Humana has not pivoted enough to make a PPO their flagship plan. This is a Humana-specific problem, not a Medicare Advantage problem. Lack of quality leadership and foresight is the main issue.

 

[sman]

The problem with Humana is they have leaned far too hard into HMO's, with Medicare Advantage. They do have a few PPO's, but they are very weak when compared to most other competitors.

Humana has always been known for their Gold Plus HMO and their HMO Chronic Condition D-SNP, at least in my region.

Problem is, PPO's came on the market about 6 years ago, and enrollment and broker and Medicare recipient sentiment has trended HARD to PPO's.

Their HMO's are good, but if I meet with 50 clients nowadays, 35-40 of them are basically demanding a PPO, immediately. And I cannot blame them.

Humana has not pivoted enough to make a PPO their flagship plan. This is a Humana-specific problem, not a Medicare Advantage problem. Lack of quality leadership and foresight is the main issue.

The lower than expected Medicare reimbursement rate for Advantage plans IS a Medicare Advantage problem and not just a Humana problem. That has zero to do with whether it's an HMO or PPO. When claims are eating 89% of the monies received, that's a problem for any insurer.

 

[DonP]

77% of Humana’s rev comes from mapd were all the other carriers it’s 30-47% . Other carriers can mask some short term pain better than Humana . I’ve probably written only 20 mapd hmo’s with Humana ever and it’s irrelevant as far as claims go . Med sups feeling the same sting of increased loss ratios . Every agent whether you sell sups/pdp or mapds will be scrambling to move clients this aep .Humana cut benefits in most areas in 2024 while the Aetnas and devoteds increased there’s . If other carriers stay stable or cut little and Humana cuts deep they’ll lose 1 million members or 8% of there book .They got a huge decision to make

 

[InsuranceGuy29]

The lower than expected Medicare reimbursement rate for Advantage plans IS a Medicare Advantage problem and not just a Humana problem. That has zero to do with whether it's an HMO or PPO. When claims are eating 89% of the monies received, that's a problem for any insurer.

Then why aren't other companies having these huge issues?

Obviously losing some money on the reimbursement side isn't a good thing, but it's obvious to me that Humana dropped the ball majorly, somewhere, in their leadership department.

In my opinion, the plan situation that I described plays into it heavily. As Don alluded to, as well, the fact that their success is also so heavily reliant on MAPD's is another major factor.

The other carriers can easily absorb or make up the losses by only maybe cutting a few ancillary benefits, because they're more diversified. But Humana can't because their business is so heavily reliant on MAPD's.

They would need to severely cut benefits, and this will simultaneously make them WAY less attractive and competitive versus other players like Aetna, United, Blue Cross, etc.

These other carriers are big into group work plans, under-65 marketplace plans, medicare medigap supplements, MAPD supplemental indemnity plans, life insurance, etc. Humana is not.

These other carriers don't need to cut nearly as much and this will keep them competitive and attractive. And as I said in my previous posts, their devotion to HMO's is also a huge negative factor.

Humana has a huge problem right now.

 

[Yagents]

Decent article

3 big changes coming to Medicare in 2025—and what they'll mean for you

Here's the lowdown on how Medicare will operate differently in 2025.

fortune.com

 

[Yagents]

She needs to retire......or give up already. Every industry has bonuses, it's what drives sales for things that need to be "sold". I thought she wants to raise income for people, and reduce profits for insurance companies?

Sen. Warren Asks Insurers About Life and Annuity Sales Incentives | ThinkAdvisor

The Massachusetts Democrat sent letters questioning the use of cash bonuses, incentive travel and other perks.

www.thinkadvisor.com