CMS Proposes New Medicare Advantage and Prescription Drug Plan Marketing Rules

The Centers for Medicare & Medicaid Services (CMS) recently released a display copy of a Proposed Rule that would enhance the marketing standards for Medicare Advantage (MA) health plans and Medicare Part D prescription drug plans. In the Proposed Rule, CMS incorporates some of the requirements that CMS previously imposed through operational guidance and introduces new MA and Medicare Part D prescription drug plan requirements.  According to the CMS Press Release, the marketing standards would:

• Prohibit cold-calling and expand the current prohibition on door-to-door solicitation to cover other unsolicited circumstances. Any appointment with a beneficiary to market health care-related products would have to be limited to the scope that the beneficiary agreed to in advance. Cross selling of non-health care-related products to a prospective MA or Part D enrollee would also be prohibited.
• Prohibit sales activities at educational events such as health information fairs and community meetings or in areas such as waiting rooms where patients primarily intend to receive health care-related services, as well as limit the value and type of promotional items offered to potential enrollees.
• Require that MA organizations that use independent agents to market MA and Part D plans use state-licensed agents for such marketing, and require that MA organizations report to states, in a manner consistent with state appointment laws, that they are using those agents.
• Require MA organizations to establish commission structures for sales agents and brokers that are level across all years and across all MA plan product types (e.g., HMOs, PPOs, and private fee-for-service plans). Commission structures for prescription drug plans would have to be level across the sponsors' plans as well.  According to CMS, these requirements are designed to discourage "churning" of beneficiaries from plan to plan each year in a manner that earns agents and brokers the highest commissions and would ensure that beneficiaries are receiving the information and counseling necessary to select the best plan based on their needs.

The Proposed Rule also contains provisions for enhancing the protections afforded to Medicare beneficiaries receiving the low income subsidy and those enrolled in special needs plans.  The Proposed Rule is expected to appear in the Federal Register on May 16, 2008.  CMS reports that it will be accepting comments on the Proposed Rule until July 15, 2008.

Comments

[Thurl Burton Jr.]

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