The ‘Easy Money’ Is Gone, But Health Agents Are Still Going Strong

SAN DIEGO -- Health care might be going through tension and turmoil, facing a most uncertain future -- but agents and brokers who roll with the changes have a bright future.

That was the sentiment this weekend at the National Association of Health Underwriters' annual conference.

But the rolling with the changes part is crucial, and not easy for many agents who have decades in the business. The "easy money is all gone," said Craig Lack, consultant and founder of Energi.

"Everything is changing and the rate of acceleration is changing," he said. "We tend to act out of muscle memory in this industry. You've got to maintain your curiosity because the world is changing all around you whether you recognize it or not."

This year's conference is heavily focused on change. It starts with how health care is delivered, something good agents needs to understand in order to serve their clients effectively.

General medical care, for example, is undergoing a major shift to "value-based care," explained Craig Taylor, associate director of medical solutions for Senior Market Sales.

The idea is to avoid hospital visits by emphasizing regular primary care checkups and home health care. By avoiding the high overhead of hospital stays, insurers that combine with physician groups and non-acute-care service providers can offer these services to members at a lower cost, Taylor said.

"They don't want people going to the hospital unless they have to," he said.

The Big Five

Health care's "vertical integration" started the massive industry shift in 2018. This year, the big five vertically integrated insurers -- Cigna, Humana, Anthem, CVA and UnitedHealth -- are taking shape, Taylor said.

The mergers that formed those five totaled nearly $140 billion. Early returns indicate the moves are paying off, Taylor noted.

Humana reported a 9% increase in Medicare Advantage membership that the insurer attributed to physicians are more than 230 clinics, he added. Likewise, Humana has said it expects 2019 individual Medicare Advantage membership growth of 375,000-400,000 members -- representing 12% to 13% growth.

Total enrollment in Medicare Advantage plans has doubled over the past decade to 20.4 million in 2018, said Shon Bowles, senior sales director for Jack Schroeder and Associates.

Total numbers of Medicare beneficiaries continues to steadily rise as well, Bowles said, topping 60.4 million in 2018. Serving the Medicare crowd should remain a fertile source of business well into the future.

"Those of us in the Medicare market are living in a great time," Bowles said.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.

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