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Dear Everyone!
I get a lot of "heat" from people (especially other health agents) about my support for some kind of universal or guarantee issue health care. Many people (again, especially agents) tell me that providing health care to all, paid for in part by those who pay taxes is not "fair." They say they don't see health care as an inalienable human right. To those folks (usually on the far-right wing) how hold this view, let me address you directly. (Do you know that health agents are some of the most far-right-wing conservatives I've ever met?)
Would you close down all the public schools to people who don't own homes (i.e. pay no property taxes?) Perhaps only those who file a 1040 should get fire protection? When a home is on fire the 911 operator would check a database to see if taxes have been paid before she calls the fire department?
I suppose that you would do away with Medicare too? It's going broke or is broke now, so why bother to keep it? If the old people live with sickness, or in pain or without their meds... or they just die, so what?
The food stamp program must really irritate many of you. All those poor people eating almost for free.
Let's close down all the ERs to all of those homeless people, to say nothing of the working poor.
Well, few of you would advocate most of these ideas. But you have to ask yourself what kind of a society do you want to live in. Perhaps you have to ask yourself what kind of human being YOU are.
OK, I hear you. You say it's not YOUR job to try to make a better society for all of us. You've got a living to make. You pay your taxes right... and the fact that most of that money goes to others is totally wrong. Am I hearing you correctly? I think I am.
Maybe you were born to privilege or maybe you just worked your butt off to get to where you are today. Good for you. Why should some guy who mows your lawn or who waits on your table or who works security at the mall or who gets minimum wage working in a retail store have access to medical care? They didn't really EARN it did they? Let 'em be sick. Who gives a damn?
We have public schools, public pools, public golf courses, public highways, socialized police, fire, and military protection. We have tax-breaks for the rich and welfare for the indigent, but we are willing to let the working poor lose their homes and incomes because either they can't get insurance because they are sick or they can't afford it.
Some of you seem to want to live not in a society that solves the need, but one which rewards the greed. I'm ashamed that many of you are in this business with me. It's all about the money to you guys, right? Yes it it.
I've learned not to come to this industry searching for a heart of gold, however I know from experience that I'll have no problem finding a heart of stone.
-Al
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Term vs. Perm... again!
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The great debate in life insurance is term vs. perm. Many agents believe that term insurance is for "temporary needs." I disagree.
Define "temporary needs." So, after 20 years and the term runs out, there is no "need" for any life coverage? There won't be a mortgage or "living expenses" or education expenses, or the need to save for retirement after the term lapses? And tell me, exactly what percent of term ever pays a benefit?
OK, your car and house insurance hardly ever pay a benefit but you have no choice when you insure them. With insuring your life you HAVE a choice.
I tell my clients to think like a banker. Never pay out money for a financial product without the express intention of getting it back. (The corollary is to never borrow money on something that gets worth less... like a car.)
Unless you absolutely can't afford it, why buy term... a wasting asset, when for a few bucks more (at age 20, 30 or 40) you can buy a good universal life (UL) or whole life (WL) or even term with return-of-premium (ROP)... which is going to give you some real value for your money... as opposed to just "renting" insurance like you do with basic term insurance.
Term insurance is sucking-candy. It looks good, has a nice wrapper, is cheap and you can get it anywhere. It dissolves in your mouth and it's gone.
A good UL or WL is the candy machine. It keeps making candy.
I tell my good-looking female clients: "Two choices. You give me a dollar and I'll give you a kiss... and leave for good. Or you can give me five dollars and I'll give you a kiss and I'll be back tomorrow and will give you six dollars. Pick one."
Maybe it is just coincidence but in all my 60 years I've never known anyone who regularly paid into a WL or "accum" UL who retired broke. But I know lots of people who put ALL their "faith" in the markets and who are going to work until the day they die. ("Welcome to WalMart!" or "You want fries with that?")
I worry about young agents out there... 25, 30.. who don't know what they don't know about investing, markets, returns, risk, reward, human nature, and all the bad stuff that can happen over a lifetime... and they... with damn little life experience... are going out and advising people on how they should "invest" their money. Yeah, that makes a lot of sense to me!
Until you have had a spouse and a home and a job and have lost a job and had someone be very sick, and made money in the markets and lost money in the markets, and have been though a few recessions and have been to a funeral or two and know real fear as well as real happiness... you are not qualified to go out there and sell life insurance... because all you know is the textbook.... and life is NOT a textbook.
Do you want to listen to some 30 year old "kid" sell the fad-policy of the day (this week it's indexed life) be my guest. With few exceptions, I'll take the guy or gal who has "been there" and who understands that term is not in the best interest of the client... although he/she knows that often it is all they can afford.
This I am sure of. When I recommend perm over term, I'm doing the best thing for the client. That does not mean the client can always afford it... but I never SELL term insurance. I allow the client to buy it after they have convinced me that they won't do what is in their best interest but instead do what their neighbor or friend or brother-in-law has done... which was "buy term and invest the difference" in what WL or UL costs (The result being is that 90% of them either spend the difference... or lose the difference.)
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If your agent doesn't talk to you about perm and is just looking for a quick sale with term... get another agent! I'd suggest one with a little gray hair!
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Advantage or a Supp?
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It's almost enrollment time again for Medicare Advantage (MA) plans and some of you are wondering whether they're legitimate. I assure you, they are legitimate, they're just a different way for you to protect yourself. For those of you who are used to purchasing health insurance through your employer's group health plan, these plans will seem very familiar.
Let me answer the main concerns I've heard regarding MA plans. At the end of this is a short "editorial" on why I don't like MA.
What's Medicare Advantage?
Basically, it's the government outsourcing Medicare duties, such as administration and claims processing, to private insurance companies. A Medicare Advantage plan can take three forms: Health Maintenance Organizations (HMO), Preferred Provider Organizations (PPO) and Private-Fee-For-Service (PFFS) plans.
HMOs and PPOs are similar in that both are managed care systems based on contractual agreements between providers (hospitals and/or doctors) and insurance companies. The difference between the two is PPOs will allow you to go outside their network, but make you pay more of the bill.
PFFS plans are different; they're also what most people are talking about when they ask about Medicare Advantage plans. I hate them and won't sell them! A PFFS plan lets you go to any doctor... but there is a catch... which I mention at the end of this article.
Here's how all the MA plans work: Medicare contracts with private insurance companies and pays them a "subsidy" to take care of seniors in a specific geographic area. For example, let us say that it costs Medicare $100 per senior to administer Medicare in Sacramento County.
So... Medicare contracts with a private insurance company and says it will pay the company $75 per senior in Sacramento County to administer Medicare and pay all claims coming from those seniors. The catch is that the insurance company must provide everything Medicare covers plus extra benefits. Everybody wins here. Medicare saves money (in theory,) the insurance company receives more clients and the policy holder pays less for more benefits (maybe).
How much do I have to pay?
It's tough to say. Most of the more than 200 companies that contract with Medicare have some sort of $0 premium plan in their arsenal. Most Medicare Advantage plans are less than $100 per month, which is a less than the average Medicare supplement. So far, premiums have remained flat compared to the rising costs of Medicare supplements, but I don't expect that to last very long, especially with the $0 premium plans.
What do I get out of it?
Besides the lower premium you usually get more benefits than you would if you had traditional Medicare plus a Medicare supplement. Many plans offer some form of hearing, vision and dental benefit, for example, although these extra benefits vary wildly from company to company. Most plans are also very heavy on preventive medicine so seeing a doctor for a mammogram, pap smear or colorectal screening is paid for and encouraged.
Lower premium and more benefits. It sounds like it's too good to be true.
Yes, it does. Now here's the catch: if you choose one of the $0 premium plans that are floating around out there you will pay co-pays and co-insurances. Many are relatively inexpensive, like $15 for to see a specialist or $5 for a doctor visit or $150 a hospital stay. You will also have a deductable where you pay it all! Most of the plans with premiums have few, if any, co-payments and lower yearly out-of-pocket maximums, but it really does depend on the policy and company. Always check to see what the yearly out-of-pocket maximum will cost you, since if you have health troubles it may cost you more for a $0 premium plan than for a traditional Medicare Supplement due to co-pays and co-insurances.
My Medicare supplement has paid everything. I've never had to worry. Why should I change now?
It depends on where you're at in your health history. A person in good health would probably snap up a $0 premium plan since he or she will save a lot of money over the course of the year. A person with a poor medical history will probably want to pay more to get more benefits and fewer co-pays. But to fully answer the question, I'd say that trust and piece-of-mind are more important than money when it comes to health. If you trust your Medicare supplement company and are comfortable paying $500 or $600 more per year for that security, I'd advice you to stick with it but get a competitive bid from time to time as prices are all over the map.
I have to take a lot of prescription drugs. How does a Medicare Advantage plan help?
Most companies offer some Medicare Advantage plans with prescription drug benefits. You will pay more, of course, but the cost should still be less than the cost of a Medicare supplement plus a prescription drug plan. Medicare Advantage plans usually follow guidelines similar to traditional prescription drug plans.
I have a lot of health problems, will I be accepted?
The only health question is this: "Do you currently suffer from end-stage renal disease?" This is kidney failure requiring dialysis or transplant. So, yes, you would probably be accepted.
Are these things a flash in the pan?
There's a chance that they could disappear in the next 2 years or evolve into something new, but I don't see them as being the same as they are now. Medicare Advantage plans seem like a small Band-Aid on a gushing wound. When the Baby Boom generation starts officially hitting 65 in 2010, I think the insurance companies will ask for more money from Medicare or Congress and not get it. This will create an even larger health care crisis among seniors. But that's just a guess.
Why don't you like MA?
MA has more benefits, but not better benefits.
With a traditional Medicare Supplement (I sell only the "F" plan) you can choose any
doctor or hospital you prefer with no referral for specialists. As you know, Medicare will pay 80%
of your doctor and hospital costs and your supplement will pay the
other 20%. There are no hidden costs, co-pays or hoops to jump through.
With a Medicare Advantage Plan you may have a built in
Prescription Drug Plan that you must use. You must make sure to compare
the drug plan, if this is the case, against your choices for stand
alone drug plans that you can get with a traditional supplement.
The big issue with me is that the PFFS flavor of MA allows the doc to treat you today... but he/she can refuse tomorrow. It's true... and it is not a risk I want anyone to take. If you want MA, go with either an HMO or a PPO flavor... not the PFFS one.
I could go on and on, but bottom line it comes down to this. If you want the best protection you can and you have the $140 (give or take) per month to spend, take a traditional supplement and not the cheaper MA. Your agent can (and should) do a complete cost-comparison for you.
I ALWAYS try to sell the supplement vs. the MA plan, even though I will often make a higher commission with the MA. An MA is better than Medicare alone, but it is not as good as Medicare plus a supplement plus a stand-alone drug plan... because, as usual, you get what you pay for. Having 3 plans instead of one looks complicated, but most often the benefits are far better than the single MA with build-in drugs.
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Well, that's a wrap for this issue. I hope you've found some of the info above useful and interesting. If you have questions about life or health coverage, safe-money annuities, or employer group benefits just give me a call or send email.
Sincerely,
Alan N Canton
InsuranceSolutions123 Agency
InsuranceSolutions123.com
916-962-9296
CA License # 0F31110
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Al Canton, Owner
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I'm Al Canton, owner of the Insurance Solutions Agency.
Everyone promises the best service, etc. So I won't bore you with that message.
Bottom line, I know health insurance, work-supplements, medicare, life, and annuities.
Most importantly, I'm honest. I will not put you in a product just for the money. I've been here 25 years and I've built my business reputation on integrity and honor.
It's that simple.
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