Long Term Care Partnerships -- Questions and Answers

Long Term Care (LTC) Partnerships are authorized under The Deficit Reduction Act of 2005. Each state must choose to "opt in" the program by amending its Medicaid plan with the approval of the U.S. Dept of Health and Human Services. The LTC Partnerships program is voluntary, so some states may choose not to participate. Several states have implemented an LTC Partnership program, while several more intend to do so. The following Q & A is intended to provide agents with information about the program.

Why are LTC Partnership programs important?
The LTC Partnership Program is a collaboration between the states and private insurance industry designed to enourage people to purchase private LTC insurance. In states where the program is offered, individuals who purchase an LTC partnership policy and use up its benefits can then apply for Medicaid. If they meet Medicaid eligibility, they can receive Medicaid-covered long-term care services while protecting some or all of their financial assets that would otherwise make them ineligible for Medicaid.

What are LTC Partnerships expected to accomplish?
The proliferation of LTC Partnership policies are expected to reduce federal Medicaid long-term care spending by $40 billion over the next five years, keeping Medicaid as the "safety-net" for low-income Americans while expanding the reach of LTC insurance.

How does an LTC Partnership work?
Example: Jim buys an LTC Partnership policy that will pay benefits for 3 years at $1000 a day. He later enters a facility and his policy pays out the maximum in benefits -- $109,500. Jim can then apply for Medicaid long-term care and can protect $109,500 in assets that he would otherwise have to liquidate and spend-down to pay for his care before Medicaid would pay.

This is known as a "dollar for dollar" LTC Partnership. The amount of protected assets equals the amount that the private LTC Partnership policy pays out in benefits. Assets that can be protected are htose Medicaid would otherwise count, such as cash savings, securities and most property. LTC Partnerships do not shelter income, such as Social Security and pension income.

What are the requirements for an LTC Partnership policy?
LTC Partnership policies must.....
1. Meet the requirements of the 2000 NAIC LTCI Model Act and Regulation
2. Be tax-qualified LTCI plans
3. Have certain Inflation Protection benefits by issue age:
a. Ages up to 60: Compound inflation protection is required
b. Ages 61-75: Some form of inflation is required (i.e., simple)
c. Ages 76 and older: No requirement to have inflation protection, but it still must be offered if required by the state's LTCI regulation

NOTE: Guaranteed or Future Purchase Option inflation protection is not permitted for LTC Partnership Policies

What training requirements must agents meet to sell LTC Partnership Plans?
Training requirements vary from state to state. Please check out the requirements by contacting your state insurance department or visiting their website for more information about the LTC Partnership program in your state.

NOTE: These training requirements will apply to selling both Partnership and Non-Partnership LTCI policies, meaning an agent cannot sell any LTCI policy unless the training requirements are met.

Here are some examples of training requirements that we've seen:
-- Agents can continue to sell LTCI (Partnership or Non-Partnership) during the first year the LTC Partnership Program is implemented in the state.
-- By the end of the year, any agent who has sold LTCI (Partnership or Non-Partnership) must complete a one-time training course (not less than 8 hours). Agents are also required to complete an on-going LTCI training every 24 months (no less than 4 hours). Insurers are required to have a copy of the training certificates of their agents on file for compliance.
--Training must cover the following areas:
-----LTCI in general
-----Qualified LTC Partnership policies
-----Relationship between LTC Partnership policies and other pulblic or private coverage of LTC

Reciprocity may exist for agents who sell LTCI in more than one state; satisfying the training requirements in one state will be deemed to satisfy the requirements in most states.

Will exisiting LTCI policy owners be able to switch to an LTC Partnership policy?
"Exchanges" is an issue that is being addressed on a state by state basis with guidance from the Department of Health and Human Services.

What states currently have a Partnership agreement in place?
All states except Utah, New Mexico, Alaska, Hawaii, Mississippi and West Virginia had an agreement in place as of 7/1/09.

What states currently have LTC Partnerships available for sale?
Oregon, Idaho, California, Colorado, North Dakota, South Dakota, Nebraska, Kansas, Oklahoma, Texas, Minnesota, Missouri, Arkansas, Indiana, Kentucky, Tennessee, Alabama, Florida, Georgia, Ohio, Wisconsin, Pennsylvania, Virginia, New Jersey and Connecticut have policies available for purchase as of 7/1/09.

Coventry Weekly PFFS Commission Payouts Reversed

Due to an issue that impacted most brokers, the weekly PFFS payout had to be reversed. The necessary corrections were made and the payout has been restarted. Coventry expects it to be completed on Thursday with EFTs and checks being transmitted/mailed on Monday, July 27.

Monumental Life Offering 2 Lead Programs

Monumental Life is offering agents two different lead programs for their final expense products.

The first is for agents that are experienced with this kind of product, and work full time in this market. It's called the ProActivity lead program. With this, you will receive 15 leads per week. If you can keep your production at $1875 NAPP per week (about 3-4 policies placed per week), you won't have to pay for those leads at all, past the initial buy-in.

The second program is for agents that are just starting in the final expense market, or for those who don't want to concentrate in the market heavily. It's called the Solutions Lead Partner Program. With this, there are no production requirements, no commission drop and no "buy-in". You are working with Monumental to develop your exclusive geographical footprint and you will pay for the lead drops. You will get Monumental's cost for the mail drops and you decide the frequency of them.

In my opinion, the largest benefit for both of these programs is the lead liaison at Monumental. If you've ever tried calling one of the large insurance companies and gotten lost in their phone tree, or didn't know exactly which department you needed to speak to, you will definitely see the advantage of working with this liaison. She is your one stop shop for any answers. Supplies, commissions, policy question, etc., she can help with it all. She's also dedicated to getting your business issued as quickly as possible. And since she only works with the agents on the lead program, she has more time to dedicate to you.

If you'd like to get more information on either of these lead programs, please contact Charli at Senior Marketing Specialists. You can reach her by phone at 800-689-2800 ext 328, or by email at charli@smsteam.net.

Universal American MA and PDP Training and Certification

Universal American is bringing their free 2010 MA and PDP training and certification program to a classroom setting near you.

In a year where other carriers are leaving the MA PFFS market, they are continuing to offer their popular Today's Options PFFS plans in all existing counties in their 46 state service area. This year, they are expanding thir PPOs to 43 markets, and will continue to offer their HMO plans in select states.But.... you must be trained and certified before you may sell these plans.

By attending just one session, you will be able to complete your CMS-required certification and learn about their 2010 portfolio of products and services, including their new agent-assisted telephonic enrollment system.

They will distribute vouchers good for one free Continuing Education course on WebCE. You can earn up to 15 CE credits online using this complimentary voucher.

Please note that a 50 question multiple choice exam will be administered during this event; agents must pass with a grade of 85% or higher to be certified for 2010.

If you cannot attend one of their live training sessions, please complete their training online. For more details, you can contact Independent Agency Sales at 800-538-1053, ext 8810, or go to certify.appointmyagent.com.

For a full schedule of seminars, please visit our website at www.smsteam.ning.com.

Free Training Webinars!

Looking for that next stellar product or project? Be sure to join us at a webinar training event next week. Attend one, two, or all webinars. Each webinar is focused on a bright and shining SMS Program!

Wednesday, July 15, 10:00a.m. CST“Living Legacy…..Making profits with a Unique Opportunity”
Reserve Your Seat At:https://www2.gotomeeting.com/register/239211530


Wednesday, July 15, 2:00 p.m. CST“Monumental Life – Final expense LEAD program”
Reserve Your Seat At:
https://www2.gotomeeting.com/register/355871339


“The Future of Medicare – Solutions for your clients and Opportunities for YOU”Thursday, July 16, 11:00 a.m. CSTReserve Your Seat At:https://www2.gotomeeting.com/register/463345187

or Tuesday, July 21, 11:00 a.m. CSTReserve Your Seat At:https://www2.gotomeeting.com/register/322277402

If you need any assistance please give Senior Marketing Specialists a call at 800-689-2800

New Under 65 Guaranteed Issue Health Insurance Product!

Do you have clients that have been declined for health insurance?
Do you have clients that can't afford individual major medical insurance?
Do you have employers scaling back, or just not providing insurance benefits?
Do you want to earn TOP commissions and new agent sales bonus?

If you answered yes to these questions, check out our new Guaranteed Issue Health Insurance Product for your under 65 clients!

Benefits and Features:
1. Guaranteed Issue -- no medical questions!
2. 4 different plan choices to fit every clients' needs and budget!
3. Prescription drug coverage included!
4. Underwritten by an A.M. Best "A" Rated Carrier!
5. Maternity benefits are covered!
6. Immediate effective dates!
7. Community Age Rated!
8. HIPAA Compliant!
9. Top commissions!

If you're looking for a product like this, please contact Senior Marketing Specialists at 800-689-2800 or by email at charli@smsteam.net!

CMS Reverses Decision on Initial Year Payments!

CMS has decided to reverse their previous decision on the MA True Up Commissions! They WILL be paying first year commission for clients that were enrolled in a PDP and Original Medicare or a PDP and a Medicare Supplement last year.

We don't have word on when or how these commissions will be paid however. Keep checking back with us, we'll have the information posted as soon as possible.

Release of Initial Year Commission Payments for Coventry

Coventry just let us know that they are currently processing the corrected data from CMS that identifies Medicare Advantage (ICEP) and PDP (IEP) enrollments iwth a January 1, 2009 effective date. This includes members who moved from Original Medicare into a Coventry MA plan.

EFT and paper check payments will be made this week. For those who received an EFT payment in May, you may see chargebacks or other adjustments on your corrected EFT's.

There has been a strong, industry-wide concern voiced about CMS ruling on MA and PDP commission rates for 2010. CMS is suspending the implementation of these requirements and expects to issue clarification shortly. CMS ia also examining it's guidance pertaining to 2009 enrollments and whether agents should be paid Initial Year commission for 2009 enrollments from a PDP to a MA plan.

Depending on timing of CMS clarification and barring any additional changes from CMS, initial year payment to brokers for February, Marchy and April 2009 effective dates should be issued in mid-July.

We understand that this is a very frustrating and confusing situation for agents. If you have any questions on these commission issues or anything else, please feel free to contact Senior Marketing Specialists. You can reach us by phone at 800-689-2800 or email charli@smsteam.net. We'd love to hear from you!

CMS True Up Commission Update 7/1/09

We wanted to send you a quick update on the CMS June 5th guidance regarding Part D to Medicare Advantage enrollments.

CMS has informed several carriers that they agree that their November interim final rule and guidance issued was not as clear as they had intended. CMS also stated they are rethinking the policy and are considering issuing a new compensation file that addresses this issue. While this continues to look positive it is important to note that CMS has not made any final decisions at this time nor have they promised us what their final decision will be or when it will come.
We will continue to send updates as we have more information on this developing situation

CMS Re-Evaluates Commission True Up Payments

Subject: Suspension of implementation of June 5, 2009 HPMS memo on agent/broker compensation;

Impending guidance on criteria for paying initial compensation fees in 2009

Suspension of Implementation of June 5, 2009 HPMS Memo on Agent/Broker Compensation: CMS has received feedback concerning the agent and broker compensation requirements in our June 5, 2009 HPMS memorandum titled "2009 Medicare Advantage and Prescription Drug Program Agent and Broker Compensation Refinements and Compensation Rate Adjustment for 2010." While we evaluate the issues and concerns being raised, we are suspending the implementation of these requirements. We expect to issue clarifying guidance shortly.

Impending Guidance on Criteria for Paying Initial Compensation Fees in 2009: CMS has received feedback about confusion on whether agents and brokers should be paid an initial compensation fee for 2009 enrollments from a PDP to an MA plan. We believe our regulatory guidance is clear that for 2010 agents and brokers should be paid an initial fee for enrollments from a PDP to an MA plan. CMS is examining its guidance pertaining to 2009 enrollments and expects to release additional guidance shortly. Plans should contact their agents and brokers to inform them that CMS is reconsidering its guidance for 2009 and expects to release additional guidance shortly.

How do US Healthcare Proposals Compare?

FACTBOX: How Do U.S. Healthcare Proposals Compare?
Wed Jun 24, 2009 10:53am EDT


(Reuters) - U.S. President Barack Obama said in an interview aired on Wednesday that he "absolutely" will get healthcare reform completed in 2009 but declined to say what the final package would eventually look like.


Lawmakers in Congress are working on at least three draft versions of proposals to overhaul the U.S. healthcare system.


In the House of Representatives, three committees have joined together to produce one draft House bill.


In the Senate, the Health, Education, Labor and Pensions (HELP) Committee has started work on a second Democratic proposal, while the Senate Finance Committee is in closed-door negotiations over a possible third healthcare bill that would win bipartisan support.
Here is a summary comparing the various bills.


INSURANCE MARKET REFORMS


* Both the House and Senate bills call for sweeping insurance market reforms.
*The House bill would set up a new government plan to compete with private companies. The Senate HELP panel bill leaves this open for later consideration.
* The Senate Finance Committee, chiefly to address Republican concerns, is instead looking at creating non-profit medical co-operatives to compete with insurers.
* All individuals would be required to obtain insurance under all of the bills.
*The Senate HELP bill leaves open the issue of employer responsibility. The House bill would require employers to pay an 8 percent of payroll "fee" if they choose not to provide health benefits to workers. The Senate Finance Committee is looking at requiring employers to pay a fee if their workers are insured by Medicaid or obtain federally subsidized coverage in the proposed insurance exchange.
* All the bills bar insurance companies from refusing to cover people or charging them more because of health history or gender. All the bills place some limits on insurance premiums.
* Insurers in all bills would be required to cover some preventive services.
* All the bills include caps on out-of-pocket expenses. The Finance Committee bill is expected to do the same.


INSURANCE GATEWAY OR EXCHANGE


* The House and Senate Finance bills would both create state insurance exchanges to act as clearing houses for individuals and small businesses to buy insurance.
* The Senate HELP committee bill proposes similar exchanges called "gateways."
*The HELP bill includes temporary reinsurance funding to help employers make medical coverage available for retirees between the ages of 55 and 64 until their state establishes a gateway.
* A proposed new public plan, or co-op, would be offered as an option available in the gateway.


OTHER COVERAGE PROVISIONS


* The HELP bill includes a sliding scale of subsidies for the purchase of insurance for people with incomes up to 500 percent of the poverty level. The Senate Finance bill would scale that back to 300 percent of the poverty level, about $66,150 for a family of four.
* Millions more people would become eligible for state Medicaid health plans for the poor. People with incomes up to 150 percent of the poverty level would be able to get Medicaid under Senate HELP bill. The Senate Finance and House bills put the level at 133 percent of poverty.
* A new support service for disabled, homebound and institutionalized people would be set up in the Senate HELP bill.
* All bills include incentives for employers to automatically enroll workers into offered health plans.
* All bills include prevention and wellness incentives.
* All bills include provisions to improve quality of healthcare in the Medicare program for the elderly. Payments to be designed to encourage quality, not quantity of services.


(Compiled by Donna Smith; Editing by Eric Walsh)

Weekly Industry Update

As promised, below you will find our weekly industry/company updates in the MA, Med Supp, and insurance industry as a whole. Please let one of our marketers know if you have any questions at all. Thanks!

WEEKLY UPDATE…

Our #1 goal at SMS is to keep you, the agents, informed and up-to-date with what is going on in our industry and within our company.

As new updates and information becomes available regarding the MA industry and the upcoming sales season, we will forward them to you promptly. Here is what we know right now:

1. 2010 MA Plan Previews are coming soon… if you would like to see the plans as they become available, please make sure we have a the most current email and phone number on file for you. Also check our website daily for any pertinent information.
2. Coventry has announced much of their PPO/HMO county expansions. Call us for details specific to your county.
3. CMS has announced their interpretation of the “true-up” commission guidelines. See the attached document for the companies announcements. As an industry we are out-raged with this new announcement and all of us should be very vocal about this newest decision.
4. With the recent announcements by several carriers to withdraw from the PFFS market, this leaves Hundreds of Thousands of clients losing their coverage January 1st. We have several options and plans to help those people. We are putting together an options guide for our agents. This will allow you quick and easy access to the 4 pathways your clients can choose from.
a. Switch to a PPO/HMO in their county
b. Switch to another carriers PFFS
c. Switch back to Original Medicare and take out a Medicare Supplement Plan (A, B, C, F, K, L are all guaranteed issued if you client is losing their PFFS coverage due to a pulled product)
d. Switch back to Original Medicare and take out a separate Hospital Plan.

Let’s not forget about the two great products Equitable Life has to offer, EquiCash Hospital Plan and CancerCare+. SMS has just completed client presentation templates for each product. If you would like us to send them your way please email charli@smsteam.net.

Last, but not least, we are very proud to introduce our newest sales associate to you, Dan Mangus. Here at SMS we have known Dan for many years. We have worked with him and his SE Missouri agency on many many projects over the years. Dan will be our sales leader for the Sterling Life, Living Legacy product. As we continue to kick this product off across the country, the enthusiasm for this product is overwhelming and we recognized the need for someone with a strong background in sales and agent support to take the lead with this product.

Again, please let us know if you have any questions, need any supplies, or have any projects you need help on.

Medicare Advantage SEP

I've come across many agents lately that are confused about when they can and can't sell Medicare Advantage. Some think they can only sell it during Annual Enrollment Period and some think you can sell it any time of the year.

For the most part, Medicare Advantage plans are sold during either Annual Enrollment Period or Open Enrollment Period, which runs from November 15 of each year to March 31. However, there are many cirucumstatnces that allow a client to have a Special Election Period during the rest of the year.

If you're not sure of what would constitute an Special Election Period, please contact us. You can call us at 800-689-2800, email us at charli@smsteam.net or visit our website at www.smsteam.net.

Sterling Life Offers Your Clients a Way to Leave a Lasting Legacy

Remember when you were young and checked the mail on your birthday? You were looking for that special card from your grandparents or favorite aunt and uncle. The one that always had a check made out to you in it. You felt a little extra loved when you received that check.I know many people who would love to be able to leave that "extra loved" feeling for their loved ones after they pass.

Sterling Life now allows you to do that with a revolutionary new product.Your clients can choose a loved one, a favored charity, their church, or any organization to receive a check each year on the date of their choice. The check will come in the mail, along with a card, chosen by your client. They can choose to have the gift sent for 10 years or for 20 years after they pass.

What better way to leave a lasting legacy? To be remembered years after you're gone? To keep the memory of you alive in a loved one's heart?The best thing is how affordable this is.

Here's an example:

Mary Sullivan would like to provide a loving legacy for each of her three grandchildren, Bobby, Christy and Chad. She choose to leave each one a gift each year of $200 for ten years after her passing. Mary's monthly premium would only be $25.59 per month!

If you'd like to get more information on this product, please visit our website at www.smsteam.net, give us a call at 800-689-2800 or email us at charli@smsteam.net.

CMS Releases News on Medicare Advantage "True Up" Commissions

Like you, we have been eagerly awaiting the report from CMS regarding the "true-up" of the 2nd half of your Medicare Advantage commissions.

We have just been informed that CMS is now saying that someone who had a stand alone PDP adn enrolled in a MA or MAPD in 2009 would only be considered a "renewal" and not "new business". This means that the agent will not receive the 2nd half of their commission on these clients.

We are working with the carriers to fight this and will keep you posted!

If you have any questions on any of this, please give us a call at 800-689-2800 or email us at charli@smsteam.net.

Pharmaceutical Industry Pledges $80 Billion To Reduce Cost of Drugs

Barack Obama on Monday welcomed the pharmaceutical industry's agreement to help close a gap in Medicare's drug coverage, calling the pact a step forward in the push for overhaul of the nation's health care system.

Drug companies have pledged to spend $80 billion over the next decade to help reduce the cost of drugs for seniors and pay for a portion of Obama's health care legislation. The agreement with the pharmaceutical industry would help close a gap in prescription drug coverage under Medicare.

Obama stated the move on Medicare will help correct an anomaly in the program that provides a prescription drug benefit through the government health care program for the elderly and disabled. Under the deal, drug companies will pay part of the cost of brand name drugs for lower and middle-income older people in the "donut hole".

Part of the $80 billion would be used to halve the cost of brand name drugs for Medicare recipients when they are in a coverage gap of the program. AARP, which represents 40 million older Americans, has lobbied to eliminate the "donut hole" completely.

This deal would affect about 26 million low and middle income recipients and apply to brand name and biologic drugs, but not generic. This would likely take effect in July 2010.

Heartland National Medicare Supplement is officially released in MO June 16, 2009. Rates start at just $121.78 for a 65 year old female. For contracting information, contact us!

Call us at 800-689-2800
Email us at charli@smsteam.net
Visit our website at www.smsteam.net

We look forward to helping you with all your senior market needs!