The private Medicare plan market is doing much better than many other insurance markets, and insurers and distributors still have room to improve Medicare plan marketing strategies.
Speakers gave agents and brokers a peek inside the machinery last week, during a webinar organized by Connecture Inc.
George Dippel, a senior vice president at Deft Research, talked about his company’s consumer survey data.
Connecture executives talked about what they seen when they look at data for their own health plan customers’ web shoppers.
Hurricanes, low interest rates and turmoil in Washington have been hurting the performance of many insurance markets, including the individual major medical market for people under 65.
In the Medicare plan market, the regulatory framework has been stable, increases in claim expenses have been modest, and baby boomers have been turning 65.
Connecture reported in December that the number of people enrolling in coverage through its systems during the Medicare Advantage and Medicare Part D drug plan annual enrollment period for 2018, which ran from Oct. 15 to Dec. 7, was 18% higher than the number who enrolled through the company’s systems for 2017.
During the webinar, Connecture executives reported that the number of consumers shopping through the web increased 32%.
The conversion rate, or likelihood that a Medicare plan web shopper would actually buy coverage, increased 30%.
Sun (Photo: iStock)
More information about the webinar is available here.
Here are three more Medicare plan shopper insights, drawn from Dippel’s remarks and slidedeck, and from the Connecture executives’ slidedeck.
1. When people shop for Medicare plans is changing.
Only 24% of Deft survey participants said they had started researching, or shopping for, Medicare plans 12 months before they would turn 65.
A few years ago, about 40% of consumers would have reported shopping for Medicare plans 12 months before they turned 65, Dippel said.
The percentage of 64-year-olds who have shopped is falling because so many more consumers are working past age 65, Dippel said.
For Medicare plan marketers, he said, the key message is that they have to do more to reach people ages 65 and older, not just 64-year-olds.
2. Medigap plans appeal to consumers who want flexibility.
Agents and brokers already know that, but Deft has the numbers to support producers’ gut knowledge.
Deft found that Medicare Advantage plans seem to be attracting a bigger share of plan switchers.
Between 2015 and 2016, the likelihood that a consumer would switch from a Medigap plan to a Medicare Advantage plan grew, to 7%, from 3%
The likelihood that a consumer would switch from a Medicare Advantage plan to a Medigap plan shrank, to 4%, from 9%.
But the survey results also show that consumers who prefer Medigap plans want to be able to choose their providers, Dippel said.
Survey participants nearing age 65 who said they preferred Medigap coverage ranked “want to be able to use any doctor or hospital” as their top reason for preferring Medigap coverage. The percentage of likely Medigap purchasers citing that as a top reason increased to 56% in 2017, from 49% in 2016.
Wanting coverage that would pay all medical bills ranked a distant second. In 2017, just 37% of the likely Medigap purchasers cited that as a top reason to prefer Medigap coverage.
Using Medigap plans is all about “no network, no network, no network,” Dippel said during the webinar. “Network fatigue is driving consumers to Med supp.”
3. Live humans are good for Medicare plan sales.
Ten years ago, some insurance distribution watchers speculated that selling health insurance online would be much easier than selling life insurance online, because consumer demand for health insurance is much stronger than consumer demand for life insurance.
In the real world, Connecture found, just 1% of the consumers who come in through a web campaign end up signing up for coverage. Only 5% of the consumers who reached its systems through ordinary web searches converted.
For consumers who came in after getting a personalized quick quote from a broker, the conversion rate was 19%.
— Read Medicare Plan Sales Clobbered Full-Cost Individual Medical: eHealth on ThinkAdvisor.