You’ve seen the TV commercials. Famous athletes or television stars urge seniors who have Medicare Advantage to call a toll-free number with promises of “exciting new benefits or other perks” that are either free or will save money. What is conveniently left unsaid is that the promised benefits are available to only a fraction of people on Medicare, and those people must meet certain eligibility requirements.
Also troublesome is the fact that when people call the toll-free number, they are directed to a call center, and not a licensed insurance agent. These call centers are staffed by salespeople only interested in enrolling callers in the Medicare Advantage plan they’re selling. There have been numerous complaints of unsuspecting seniors being enrolled in plans that do not provide the benefits they need, or in plans that are not even available in their area.
The Center for Medicare and Medicaid Services, the federal government agency that oversees the Medicare Advantage program, has taken notice of these deceptive marketing and sales tactics. In April, CMS issued new regulations to designed to protect against “confusing and potentially misleading activities.” The regulation points to CMS’s own data on consumer complaints in support of the new regulations. In 2021, the agency received 39,617 complaints related to marketing practices — more than double the 15,497 complaints received in 2020.
Independent agents and brokers share CMS’s concerns about deceptive and aggressive sales and marketing tactics that promote plan benefits that are not widely available, or trick seniors into believing that these advertisements come directly from the government. We have seen people being duped into switching plans that cost more yet offer fewer benefits or have limited provider networks that don’t include their doctor.
However, we are concerned that the regulations as written will harm licensed, independent agents and brokers. In an effort to crack down on boiler-room-like sales tactics, CMS has lumped independent agents and brokers in with call centers and other “third-party marketing organizations.” New CMS proposed regulations now will require everyone who helps enroll consumers into Medicare Advantage plans and Medicare Part D to record and store all Medicare-related calls for up to 10 years. This provision would add new compliance and financial burdens to independent agents, many of whom are small-business owners without the financial resources to implement the new recording and storage requirements.
According to CMS, more than 29 million seniors receive their Medicare benefits through Medicare Advantage. Meanwhile, an estimated 100,000 licensed insurance agents and brokers are certified to offer Medicare Advantage and Part D plans. That’s an average of 290 enrollees per agent. Imagine having to record and electronically store every call for a decade. Sure, there are vendors that will offer solutions, but it’s another cost. And an unnecessary one at that.
Independent insurance agents work with Medicare beneficiaries every day to make plan or benefit decisions that best meet their personal and financial needs. Those decisions are not based on misleading and inaccurate information in slick advertisements. These burdensome new regulations could very well drive many out of the market, leaving millions of Medicare beneficiaries without access to independent, professional assistance in selecting a plan that best meets their needs. Without professional, licensed agents, Medicare beneficiaries will have fewer choices in finding accurate information in guiding their decisions.
Independent agents and brokers are calling on CMS to delay the regulation’s Oct. 1 effective date to better respond to these concerns and to craft new regulations that protect consumers, while ensuring that Medicare beneficiaries do not lose the assistance of the licensed independent agents they rely on when choosing a plan that meets their needs. Independent agents are not the problem, we are the solution.
Ronnell Nolan is the president and CEO of Health Agents for America, a nonpartisan trade association for independent, non-captive health insurance agents. She may be contacted at [email protected].