Scaling efficiently can be a struggle for Medicare FMOs, as they look to grow their footprint in today’s competitive market. If FMOs wish to scale effectively, good agent relationships are vital to their long term success, and in turn, enable good relationships with carriers.
From this perspective, policy processing can become a double-edged sword. As agents (and, by association, the FMO) become more successful, policy processing becomes increasingly complicated. To further exacerbate the problem, policy processing issues impact the agent relationship and loyalty dynamic. When this happens, there’s a risk of eroding the FMO’s ability to scale effectively.
Missed payments, payment discrepancies and error-prone manual processing will mean that the organization struggles to operate at efficiency from both a process and cost perspective. It is therefore vital that FMOs understand the most common policy processing issues, and how they can be avoided, so that they can eliminate them from their operations and redirect their energy to other aspects of their business.
In this article, we’ll explore three common Medicare policy processing issues – and give some tips on how to reduce them.
The most common policy tracking issues that FMOs face today tend to relate to process. An inefficient or poorly designed policy tracking process creates a number of gray areas within the operations of the business. Firstly, it does not provide for line of sight on the status of payments. In order for FMOs to be effective, it is vital that they have instant access to a comprehensive overview of all active policies and carriers, to effectively track their status and the payments associated with them.
Secondly, manual processing is time-consuming and prone to errors. Automation of this process helps provide a solution, however it can create additional headaches as different carriers work with different policy templates, and staying abreast of all of these can become a full-time job on its own.
Commissionly offers an effective and elegant solution to processing problems, as the platform is designed to enable bulk upload of policies from any carrier, with the ability to create customized templates for each carrier. Additionally, Commissionly provides a real-time instant overview of all active policies, and the status of the associated payments.
The second most common policy processing issue for FMOs relates to commissions. From the perspective of the agent, commission payments are vital to their bottom line, and therefore are their number one priority. For the FMO, it is important to be aware of all your agents’ active commission schedules, what needs to be paid, when it needs to be paid and on what cadence. This becomes even more complicated when commission splits are involved.
Traditionally, this administrative function has been handled manually, and as previously discussed, this can be extremely time consuming, and error prone. Additionally, it can also involve significant risks for the business, as discrepancies in this area can result in substantial revenue losses, and the compromise of agent loyalty to the organization.
Having a software solution like Commissionly, in place allows the organization to mitigate these types of commission-related issues. Commissionly allows all active policies to be matched to their corresponding commission schedules, which means that any missing or incorrect residual payments are immediately flagged by the system, and can be dealt with swiftly. Additionally, Commissionly has a built in formula engine which facilitates unlimited customization of discrepancy criteria, so that your organization can be prepared for all eventualities.
The final issue that FMOs face from a processing perspective is transparency. Complex spreadsheet systems don’t tend to correlate with easy and transparent agent access. This creates an administrative issue for the organization, as well as damaging the agent relationship.
Thanks to permissions and privacy issues, agents can often struggle to see the impact that they are having within the organization from a sales perspective. This is compounded when the lack of transparency and access impacts their financial expectations, resulting in agents feeling divorced from the results of the sales that they are making.
For FMOs, the resultant low level of employee morale, coupled with the time consuming nature of attending to agent queries and discrepancies, means that valuable energy is wasted in administrative and human resource duties, rather than focussed on ensuring optimized efficiency throughout the organization.
There is no doubt that digital transformation is having an exponential impact on the insurance industry, and that this impact is only going to increase as time goes by. However, it also opens up numerous opportunities to FMOs who are looking to not only deliver efficiency through their value chain, but future-proof their business for long-term survival.
The impact of agent expectations cannot be underplayed, and providing an experience that keeps them engaged, informed and motivated will prove to be a valuable competitive advantage in the medium-term.