Insurance agents may receive their compensation either directly from a flat fee payment, or commissions included with your premium payments. Some companies even provide bonuses to top brokers.
The Affordable Care Act established quality bonus payments to encourage Medicare Advantage plans to compete for enrollees based on their quality rating, and we estimate these payments will total approximately $12.8 billion by 2023.
1. Allstate
Insurance companies are spending billions of dollars to entice Medicare Advantage enrollees to stay with their plans – KFF estimates this total will reach an astounding $12.8 billion by 2023.
Allstate provides auto, home and life insurance through both an online storefront and through an exclusive agent network. Their advertising campaign stars Mayhem who symbolises collisions and storm damage that Allstate covers for policyholders.
Allstate and other insurers are frequently criticised for bonuses that incentivise adjusters to deny or underpay claims, potentially opening them up to extracontractual bad-faith claims. In response, this report examines how insurance firms can design incentive compensation packages in order to mitigate such risks; its authors utilize data from Nebraska where insurers must publicly disclose executive compensation that includes salaries, bonuses and other forms of remuneration for executives.
2. Aetna
Insurance industry bonuses are an often hidden cost for employers and employees. Their inclusion is built into premiums companies pay when purchasing health coverage through insurers.
KFF analysis projects that Medicare Advantage enrollee bonus payments to insurance companies could reach $12.8 billion by 2023, up from just over $1.7 billion in 2022. UnitedHealthcare and Humana stand out as among those receiving these bonuses; almost half of their enrollees receiving payments.
Zippia’s analysis relies on data provided by the BLS, company filings and estimates derived from these filings. For more information about Aetna’s CEO compensation please visit their website here. Aetna provides its conclusions as to whether a service or supply is medically necessary via its Clinical Policy Bulletins (CPBs) which do not represent medical advice; instead treating providers are responsible for giving advice and providing treatment as required for each member.
3. Blue Cross Blue Shield
Blue Cross Blue Shield (BCBS) is an association of independent, community-based and locally operated health insurers which together provide healthcare coverage for one in three Americans. BCBS’ plans offer hospital and medical coverage in some states or regions while serving as administrators of Medicare in many others.
Blue Cross Blue Shield (BCBS) companies were first founded as non-for-profit entities by Baylor University Hospitals and financially struggling patients to provide affordable healthcare coverage. Its name and symbol were inspired by lumber camps of the Pacific Northwest where workers organized plans to pay monthly fees to medical service bureaus staffed by groups of physicians. Now millions rely on Blue Cross Blue Shield companies for relief in times of turmoil while its members benefit from clarity in an ever-evolving healthcare landscape.
4. Cigna
As is well-documented, many insurance companies remunerate claims departments with cash rewards to lower claim payouts – an unfair business practice which should not be allowed by most courts.
But one day, Cigna medical director Day was surprised to find something alarming in the patient files sent by nurses: sloppy work that contained errors that could lead to inappropriate denials of claims.
She immediately told her supervisors about this shortfall, who then put her on a performance improvement plan. Her supervisors knew this laggardism was evident due to company dashboards which tracked medical director productivity.
Brokers earn commissions through employer and employee payments for health benefit plans, but many brokers also may receive bonuses hidden from employers tied to how quickly they approve or deny treatment requests.
5. Humana
Humana offers Medicare Advantage plans that combine various health coverages into one policy at an often reduced price compared to traditional Medicare Supplement insurance plans.
Humana also offers Medigap policies, which cover some of the costs when you meet your health insurance deductible. Policies vary by state; however, Humana’s Medicare Advantage plans have consistently received high customer satisfaction scores according to JD Power’s research.
Medicare Advantage enrollees can measure how well a plan is functioning by checking its star rating published annually by the Centers for Medicare & Medicaid Services. Star ratings are determined based on quality measurements and patient feedback; NerdWallet’s reviews of Medicare Advantage plans consider pricing, coverage options, complaint rates and other aspects – so read our comprehensive review of Humana Medicare Advantage plans today.
6. Health Net
Health Net, California’s largest health insurer, pays bonuses to brokers for enrolling customers with its Medicare Advantage plans. These bonuses can reach into the millions each year for top-selling brokers; unfortunately many go unreported.
Documents published by the Times also revealed that the company offers bonuses to their senior analyst responsible for rescission reviews based on how many policies she can rescission, according to documents made public by them. Her goals were made public during a hearing in a lawsuit brought by customers whose coverage had been cancelled.
Participating brokers must have an active broker contract on file with Health Net, and submit group business through an authorized Health Net broker. Payments are processed within sixty (60) days after qualifying period reports become available and membership numbers have become final. Bonuses may also be payable in addition to any published Health Net Small Group New Sales programs for that period.
7. Kaiser Permanente
Kaiser Permanente’s advertising campaign centers on its tag line: “In the Hands of Doctors.” Kaiser stresses how their doctors are at the helm in all aspects of care delivery.
Insurance companies typically pay brokers commissions when they sell their products, with those fees reflecting in employer and employee premiums for health insurance policies. But some insurers also give bonuses to top-selling brokers which could present potential conflicts of interest.
The new contract calls for Kaiser to increase wages and offer employees a $1,500 performance sharing bonus as part of its contractual minimum hourly wage of $25 in California and $23 elsewhere where Kaiser operates. It also sets forth contractual minimum hourly wages in other states where it operates – the CKPU representing workers at hospitals such as registered nurses, respiratory therapists and lab/pharmacy employees who will all benefit.
8. Medicare
Medicare Advantage enrollees have access to private health plans offering additional services, reduced cost sharing and rebates against Part B and/or D premiums. Under the Affordable Care Act’s Quality Bonus program, Medicare Advantage plans that meet specific star rating thresholds may receive extra payments to compete for enrollment based on quality alone.
KFF analysis projects that federal spending on bonus payments to Medicare Advantage plans will reach $12.8 billion by 2023, up almost 30% year-on-year from what was paid out in 2022. Most of this spending goes to UnitedHealthcare and Humana; remaining amounts go towards Kaiser Permanente, CVS Health and Centene.
NerdWallet editors are subject matter experts who utilize primary sources, reliable government websites, academic research and interviews with industry professionals when compiling content for NerdWallet. We do not accept advertisements or sponsorships and we maintain complete editorial independence in all decisions we make.
9. Northwestern Mutual
Northwestern Mutual, founded in 1872, is an industry leader for life and long-term care insurance policies. Their employee benefits package is second to none – competitive base salaries and bonus structures; paid holidays/vacations/401(k) plans; health/disability coverage as well as life and annuity policies among many more!
Whole and permanent life insurance policies accrue tax-deferred cash value each year, after expenses to pay claims and operating costs have been subtracted, the remaining amount is then subject to guaranteed rate interest credits and could receive dividends should investments, operations, and mortality prove more successful than anticipated – which will mean additional income for policy owners!
Additions or modifications can be added to an existing policy or used to pay premiums. Any such changes should be reviewed with legal or financial adviser prior to making such modifications.
10. State Farm
State Farm’s iconic logo of interlocked red, white and blue ovals is one of the nation’s most easily recognisable symbols. Established in 1922, this symbol first appeared in its advertising campaigns as early as 1925.
Insurance giant AIG stands out by being owned by its policyholders rather than publicly traded shareholders, yet still pays its top executives “massive salaries and bonuses,” as reported by Consumer Federation of America.
State Farm reported its compensation data with state insurance departments; however, due to not disclosing how much its agents make per agent. As a result, it can be hard to compare with what competitors pay their agents; nevertheless, many employees at State Farm reported receiving annual bonuses (and the company offers two rewards-earning credit cards as well).
