Medicare can be confusing.
There are enrollment periods, late enrollment penalties, a whole “alphabet soup” of plans and parts, and seemingly hundreds of details that can cost you money if you’re unaware of them.
Here’s the good news:
You can easily get a licensed insurance agent to help you out with Medicare at no cost to you.
But should you? Or should you just do it yourself?
If you’re still unsure, this article is for you.
What are Licensed Insurance Agents (Sometimes Incorrectly Called “Medicare Agents”)?
Licensed insurance agents are typically independent licensed insurance brokers who can help people understand their Medicare options, find the right plan for their situation, and may also assist people with Medicare issues that they run into.
It’s important to note that even though some people call licensed insurance agents “Medicare agents,” these agents are not directly affiliated with Medicare or the federal government. They get called “Medicare agents” simply because they help people navigate Medicare.
So when we hear the question, “Why do I need a Medicare agent?”, we gently explain that we’re not representing the government in any way.
Some of the Medicare-related things licensed insurance agents can help you with include:
- Understanding Medicare Options – There’s Original Medicare, Medicare Advantage Plans, Medicare Supplement Plans, Medicare prescription drug plans, and more! A licensed insurance agent can help you understand each of these and what they cover. They can drastically simplify Medicare for you, and help you avoid potential mistakes.
- Find the Best Plans for YOU – The best plan for you depends on your specific needs and your location—because plans vary from place to place. Licensed insurance agents will not only help you understand the different plan options, but they can go ahead and look for and compare the plans in your area. This makes finding the right plan for you easier!
- Help With Medicare Issues – Licensed insurance agents may also sometimes help you if you run into issues with Medicare. Again, Medicare is extremely complicated and confusing. So when problems pop up, a licensed insurance agent can help you understand it and how you can move forward.
Independent vs Captive Agents
Independent licensed insurance agents may represent several insurance companies, while captive agents can typically only sell from one.
Since they’re not tied to one company, independent insurance agents can typically represent you with options that best suit your needs. They can listen to your exact needs, and help you choose between several different insurance companies.
Meanwhile, captive agents will generally push you toward the company they represent. Sometimes, they do this even if it’s not in your best interest.
Licensed Insurance Agent vs Broker
Some people call independent licensed insurance agents “insurance brokers,” and captive agents “insurance agents.”
The terminology can be confusing. Especially because when someone calls themselves a licensed insurance agent, it could actually mean they’re a captive agent that works for one specific insurance company.
Here’s an easy way to think about it:
Licensed insurance brokers are the same thing as licensed insurance agents. They represent several insurance companies and can help you find the best plan fit for you.
Captive agents are sometimes also referred to as “salespeople” or “sales agents.” Again, these people typically only represent one insurance company and tend to steer you toward that company.
Whatever the case, when dealing with a Licensed Insurance Agent or Broker, it’s wise to check if they represent several insurance companies! This is because titles are sometimes used interchangeably.
Just because someone calls themselves a “Medicare agent” doesn’t mean that they work for Medicare or represent several insurance companies (they may be a captive agent). Be aware of this because some salespeople may misrepresent themselves to sell you a plan.
And especially beware anyone calling you, saying they’re from “Medicare.” That’s likely a scam!
How are Medicare Agents Paid?
Licensed insurance agents who help with Medicare plans are typically paid by commission. This is why they often provide their services at no cost to you!
Independent insurance agents typically get commissions from selling Medicare Advantage Plans, Medicare Supplement (Medigap) Plans, and Medicare prescription drug plans (also called Medicare Part D).
Note that these are Medicare plans provided by private insurance companies. Licensed insurance agents don’t get a commission from Original Medicare, which is provided directly by the federal government.
Do Licensed Insurance Agents Push You Towards Plans With Higher Commission?
There are some salespeople who, despite not being a captive agent, may push you toward a plan that offers them a higher commission.
However, the Centers for Medicare & Medicaid Services (CMS) has been cracking down on this. Recently, the CMS had a press release that they are working on establishing a set dollar amount that plans can compensate Licensed Insurance agents. This is to prevent biased suggestions from them.
Can You Switch Insurance Agencies After You Sign up for Medicare?
Yes, you can typically switch insurance agencies or licensed insurance agents at any time. If you are unhappy with your licensed insurance agent for any reason, you can simply contact another one for help.
However, this does not mean you can switch your Medicare plan at any time. There are certain enrollment periods throughout the year that allow you to change plans.
Your licensed insurance agent should help you understand when you can switch plans. However, some enrollment periods you need to be aware of include:
- Initial Enrollment Period – A seven-month window around your 65th birthday when you can enroll in Original Medicare, a Medicare Advantage Plan, or a Medicare Supplement Plan + a prescription drug plan.
- Annual Enrollment Period – A period running from October 15 – December 7 where you can join or switch Medicare Advantage Plans and/or prescription drug plans.
- Special Enrollment Periods – As the name suggests, these periods come up in special circumstances. For example, if you delay enrolling in Medicare because you still have creditable coverage from your employer, you’ll get a Special Enrollment Period once your group coverage ends. There are several Special Enrollment Periods for different types of Medicare plans.
These are just some of the enrollment periods. Check out medicare.gov to learn more about these enrollment periods!
What Makes a Good Licensed Insurance Agent? Five Things to Look For
Like all professions, there are great licensed insurance agents, mediocre ones, and some you want to avoid altogether.
Here are some pointers to look for when dealing with licensed insurance agents!
- Represents Many Companies – As much as possible, you’ll want to work with someone who represents most (if not all) of your options. Licensed insurance agents that represent many companies can assess your situation and point you to the insurance company that best fits your needs. On the contrary, captive agents could push you to their company, even if it’s not in your best interest.
- Sells Different Plan Types – If you’re still unsure if you want a Medicare Advantage or Medicare Supplement (Medigap) Plan, talking to a licensed insurance agent who sells BOTH is a great idea. If you talk to people who sell only one type, they could be biased to a certain degree. A lot of the negative comments on Medicare Advantage Plans come from salespeople selling Medicare Supplement (Medigap) plans and vice versa. In reality, both types can be good options, it all depends on your specific needs (which an unbiased licensed insurance agent can help you with).
- Helps You With Other Problems – A good licensed insurance agent should help you with your other problems relating to Medicare. Remember, they don’t earn a commission from Original Medicare or Social Security, but they should still help you with these things (even if they don’t get money from it).
- Doesn’t Charge You – Licensed insurance agents who sell Medicare plans are primarily paid by commission. They don’t need to charge you unless they are offering a special type of service. If someone offers their services as a licensed insurance agent to help you compare plans in your area, just remember that it shouldn’t cost you anything!
- Someone You Feel Good About – Last but not least, you should work with someone you’re happy to work with! Remember, you can switch licensed insurance agents at any time. So if someone feels “off” to you for any reason, there’s no harm in looking for help elsewhere, or for a different opinion!
Ready to Work With a Licensed Insurance Agent?
If you’re looking for a licensed insurance agent who represents the different plans in your area, sells both Medicare Advantage Plans and Medicare Supplement (Medigap) Plans, can assist you with your other Medicare problems, and doesn’t charge you anything for help, then contact our team today!
You can call or text us at +1 877-360-6565 (TTY: 771), and we’d be happy to help.
Alternatively, you can check out our FREE workshop, which will teach you what you need to know about Medicare in order to make an informed decision: