Medicare AEP Sales Strategy
It is critical for agents to have a Medicare AEP sales strategy. Going into AEP without a plan can lead to a higher attrition rate on an existing book and lost opportunites for new sales. This post details a number of best practices independent agents use to have success during the Medicare AEP. New sales are certainly important but retaining existing clients is arguably more important. Take some time between your certifications and come up with a gameplan.
Medicare AEP Sales Strategy: Large book of business vs. small or no book
AEP strategy is different for some agents vs. others. Agents with a large existing book of business need to devote time to retaining that book. Meanwhile, new agents may focus nearly all their efforts on selling new plans without spending time keeping existing business on the books.
New Agents without a book
While they do not have an existing book to worry about, new agents still need to plan for AEP. Once October 1 (can not write until the 15th) comes around, prospects will not magically appear because it is AEP. Work needs to be put in prior to AEP in order to take advantage when it comes around.
Load up the CRM/calendar:
Everyone you speak already on Medicare or turning 65 outside of AEP is a prospect for AEP. The best agents will line up appointments for the coming AEP throughout the year. For various reasons, you may not be able to close a prospect you meet or talk to outside of AEP. Maybe they are happy with the plan they have or maybe they do not have a valid elections period. Even if do not get a sale, be sure to schedule a call or meeting with them during AEP. Advantage plans change benefits, Medicare supplements have rate increases. Let them know a plan that is perfect for them now may not be perfect once the rates increase or benefits change. Same goes for anyone that may have changed but did not have a valid election. It is increadibly suprising to see how many agents do not set their lock in prospects up for an AEP meeting or call.
Might stick with those leads a little longer:
Some leads never work well while others tend to do better during AEP. (The opposite can happen as well) Online leads, tele-sales and Facebook leads tend to be a little more difficult during the lock in. You get a number of candidates that are just tire kicking at this time and a number more that do not have a valid election period. The result is a low closing ratio that can turn agents off to both types of leads. The closing percentage on both lead types tends to improve during AEP. Agents may want to continue getting them during this time as a result. Prospects get more serious about choosing a plan during AEP and the need for a SEP is not an issue. It goes without saying, you should also try to get back in touch with the leads you worked but didnt close during the year.
Leads that get tougher during AEP:
Mailers still work as a Medicare lead source. Mail is still one of the most popular types of sales leads. Agents still utilize it heavily for SEP and T-65 sales. Using mail is trickier during AEP however. The average mail reply card response rates goes down to 1% or less during AEP. The reason is everyone is dropping mail during AEP so the piece sent out on your behalf is one of 20 in the prospects mail box. If you plan to use mail during AEP, make sure you get it out early so it hits mail boxes well before the month of October. We suggest having AEP mail orders in no later than mid August in order to beat the 1% response rate.
Retail and community events are best during AEP:
AEP is the most opportune time to work retail. Having a table at Walmart, CVS, Walgreens or any communiy with can be very productive during AEP. Dollar stores or just about anywhere that has a senior population works. AEP is the time when seniors are most open to visiting an agent at a store or event. To learn more about retail opportunities and how to get the most out of the locations click here
Medicare AEP Sales Strategy: Agents with an existing book
Agents with an existing Medicare book should take a different approach when it comes to AEP. Believe it or not, the majority of agents with books of business tend to focus on new sales during AEP. Nearly 50% of Medicare agents do not contact their existing books for retention. The average Medicare book of business should have a renwal rate of about 95% if the agent is spending time on retention. Attrition rates can be much higher for those that do not. On average, it cost about 6 times more to obtain a new client vs. keeping an existing client. Given the high amount paid on Medicare renewals, (Click for 2022 commission amounts) it makes sense to spend time keeping them on the books.
Client retention details:
For starters, there is no reason to flip an entire existing book just because the current plan may no longer be the absolute best. There is a tendancy for agents to do this. Not only is it increadibly time consuming and revenue neutral but it may have a negative effect on clients. Clients may be happy with their existing plan. It may make sense to keep them on the current plan assuming there is not another one that is absolutely head and shoulders better. When clients change plans, they need to get new formulary exceptions, possibly set up a new mail order and other things that may be disruptive. Leave it up to them if they want to change or not. It is best not to assume.
Emails and texts:
More and more agents are getting email address and mobile numbers from their clients. Having email and text allows for much more efficient communication when it comes to plan changes and the opportunity to see what else is out there.
Contacting existing clients and knowing plans:
Contact existing clients starting on October 1. It is important to reach out to them as quick as possible. It is also important to know the plan they have, what is changing with it and other plans that may have come out. These calls can easily be scripted if you want to hire temporary help or have a current staff member make them. The important part is that contact is made with the existing client. A majority of them will want to renew as is. Others may want to see what other plans are out there. When this is the case, it is most efficent to have a phone call set up to go over the details. Online enrollment with Sunfire or Connect4Medicare can make changing plans for existing clients much more efficient as well.
Numerous studies have been done specific to insurace books of business. The findings are that 91% of current customers would be willing to refer their agent to others. Their agent only asks them for referals about 11% of the time however. Existing clients can be a great way to get new clients. We also suggest offering a referral gift to clients whenever they give you a legitimate referal. (Provide it even if you dont close the sale) Make sure the gift is a retail cost of less than $15 in order to stay compliant. CMS rules now allow you to openly asking existing clients for referrals at the meeting or on the phone when reviewing benefits.