Between 2014 and 2022, payments to Medicare Advantage brokers grew from $3.9 billion to $10.1 billion per year, according to a research letter published May 18 in JAMA Internal Medicine.
Scholars with the Brown University School of Public Health in Providence, R.I., used data gained through a Freedom of Information Act request to determine the share of MA beneficiaries enrolled by brokers, as well as estimated broker pay.
The researchers relied on the CMS maximum compensation rate — $611 for new enrollees and $306 for renewals — to assess spending. This could have led to an overestimate, but the process also fails to capture possible large bonus payments, which may lead to an underestimate.
The 2014 to 2022 window saw 22 million new and 112 million renewing enrollees. The percentage of new enrollees coming from a broker referral was 43.7% in 2022 versus 35.8% in 2014. The share of maintained enrollees with a renewal fee was 69.4% in 2022, up from 50.1% in 2014. Nearly three-quarters of broker spending in 2022 stemmed from renewals.
“Brokers are not a fiduciary of the beneficiary and may enroll beneficiaries in plans not based on their needs but based on which compensate them the most through commissions and bonus payments meeting enrollment targets,” the letter said.
Last year, a Texas federal court struck down parts of a CMS rule finalized in 2024 that addressed MA broker pay limits.
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