I noticed that a major national publication(1) that is widely read by affluent seniors published a sponsored links section under the heading “2015 Medicare Premium Cost” that raised my curiosity and made me a little suspicious(2). I decided to check it out. The simple benchmark I used was to ask myself “Would I be comfortable referring my father to this site?“. This is what I learned:
The sponsored links page contained 14 listings. I clicked through to each of them to see what information was available and whether the sites seemed safe, straightforward and reputable.
- Only one of the 14 was actually an information resource that did not sell any product on its page. It did link to product sales but gave an on-screen warning that “You are now leaving the Medicare information section”.
- One of the 14 was actually just the search engine About.com drawing traffic to its site under the search term “Medicare Information”. An interesting approach; I had forgotten that sometimes the search engines actually purchase web traffic for resale.
- The other 12 of the 14 were actually data mining pages where you had to give personal information first (name, location, email and phone number in each case) in order to enter the site of access any meaningful information. It would be naive to not realize that these collected leads are heavy marketed in various formats, sold and resold. Personal information on seniors looking for Medicare information are likely to be among the most valuable types of sales leads for a range of other product sellers. These sites do not limit the use of consumer data once they collect it.
- Two of the sites were obviously misleading in that they advertised “Medicare Plans” or “Medicare Insurance” in the title when they were actually selling Medicare supplement insurance. In my opinion, these violate insurance market conduct rules.
Overall, I was disappointed in the quality of the “resources” in this exercise. I conclude that the best online resource for information about Medicare is still the government’s official 160 page national handbook “2016 Medicare and You“.
Individuals who want personal assistance with Medicare issues seem to have two basic options:
1) Give their personal information and allow the product provider to enter them into a marketing campaign and have a sales representative contact them, or
2) Hire a personal adviser and have their adviser do the legwork for them. This second option is further limited since the number of financial advisers skilled in Medicare insurance issues are few and most of these, I suspect, receive compensation as commissioned sales agents. It is not that the commissioned agent approach is wrong (in fact I believe it is the best option for most people), but it is important to recognize from the start that this creates a conflict of interest situation to the client that should be disclosed by the seller and understood by the client. A relative few individuals will be able to have their fee-only financial adviser recommend options on Medicare and supplemental coverage.
The most common tradition sources may still be the most practical. Friends, magazines, print advertisements, etc. have been common sources of information on Medicare, Medicare replacement plans and supplemental insurance.
The federal government and state insurance departments have long held the position that seniors searching for Medicare-related insurance products are vulnerable to unscrupulous or misleading sales practices and sometimes outright fraud. It appears that there is plenty of evidence to support these concerns so it seems that this topic of online Medicare product marketing deserves more regulatory attention.
(1) The publication was The Wall Street Journal but I omitted the name in the article because I don’t want the post to be a criticism of them; it could likely have been any publication that takes a similar approach to online advertising.
(2) I recently completed an online professional continuing education course on the topic of ethics in the senior insurance market that expanded on these risks. The list of schemes discovered by regulators and the number of prosecuted cases is overwhelming.