Medicare - Overview and definitions

Insurance companies pay the first full year’s commission upfront, the commission is broken up between Initial/True-up, between Street/Override, and the amount can be prorated when a Policy starts in a month other than the beginning of the year.

Comissio was developed to solve the complexities of how the commission amount received needs to be allocated to different amounts for Street and Override. This is accomplished by a ‘Medicare Engine’ that will help determine the allocation of the Commission Received amount into the various Street and Override fields.

MEDICARE commissions are comprised of the following types:

STREET – Commission paid to the Writing Agent.

OVERRIDE – Commission paid to the next levels up in the hierarchy from the Writing Agent directly. This can vary by carrier.

INITIAL COMP – Commissions paid when a customer enrolls in a new plan. Policy holder’s previous Medicare status is not relevant as Initial Comp is paid regardless. 

TRUE-UP – Commissions paid when CMS (Centers for Medicare & Medicaid Services), confirms a customer who has never had Medicare before enrolls in a new plan.

RENEWAL – Commissions paid starting in the next calendar year when the Policy remains in force.

Important terms used in help documents for Medicare

MEDICARE or MAPD/PDP will refer to Medicare Advantage and Medicare Prescription Product Types. Product Type Medicare Supplement is not included in the changes outlined here as commissions are processed in the same way as other Product Types

Non-MAPD will refer to all other Product Types, including Medicare Supplement, which are not MEDICARE.

‘Street/Override’ fields or ‘Initial/True-up’ fields will refer to the fields in a Medicare transaction , displayed in the Commission detail page, and ‘Results Medicare’ in a cycle. ‘Street/Override’ will refer to the first four fields below, and ‘Initial/True-up’ will refer to all six. The fields are:

• Street Initial
• Street True-up
• Override Initial
• Override True-up
• Street Renewal
• Override Renewal

High Level end-to-end Process for processing commissions for MEDICARE In Comissio:

1. Create Commissionable Products – same as non-MAPD
2. Create Contracts – same as non-MAPD
3. Create Contract Commission Rates specific for MAPD & PDP
4. Create Agents – same as non-MAPD
5. Create Policies – same as non-MAPD (but premium not needed)
   1. Import Commission Distribution specific for MAPD & PDP if bringing in MEDICARE Policies from a legacy system
6. Create Transactions – All imports for transactions, Policy & Transaction, Transactions, and Transactions MAPD & PDP can be used. The Transaction MAPD & PDP import however is the only one that allows the admin to designate the amounts they want in the ‘Street/Override’ fields.
7. Populate Street and Override fields - the system from a ‘Medicare Engine,’ or the Admin, will allocate the Commission Received from the Issuer into the Street Initial, Street True-up, Override Initial, Override True-up, Street Renewal, Override Renewal fields.
8. Run Commission cycle (note: MEDICARE and non-MAPD can be run in the same cycle or separately)
9. Review Results - (non-MAPD commission details will be in a ‘Results’ tab, MEDICARE commission details will be in a ‘Results Medicare’ tab.) The number of months the amount for each of the Initial and True-up fields will be displayed and can be used to look for anomalies.
10. Apply Adjustments – same as non-MAPD
11. Close Cycle – same as non-MAPD
12. Agents will receive email and link to view Statements. MEDICARE and non-MAPD will display different information in the Commission Activity sections.