CMS proposes more crackdowns on Medicare Advantage marketing, broker payments

CMS is proposing a set of new Medicare Advantage rules, including new standards that would impose more limits on plans' payments to brokers and limit the role of third-party marketers. 

According to a Nov. 6 news release from CMS, the new rules would standardize payments that plans are allowed to make to brokers, which many Medicare beneficiaries rely on to help them choose their plan. According to CMS, the current system advantages larger insurers, which can afford to pay brokers more in bonuses for enrolling members in their plans. 

"People with Medicare deserve to have accurate and unbiased information when they make important decisions about their health coverage," CMS Administrator Chiquita Brooks-LaSure said in a news release. "Today's proposals further our efforts to curb predatory marketing and inappropriate steering that distorts healthy competition among plans." 

Here are five things to know about CMS' proposed rule: 

1. CMS is proposing a cap on compensation that plans can pay brokers, set at $632, regardless of the plan a beneficiary enrolls in. This cap is currently $601, but plans can currently pay administrative fees and other payments on top of this cap to brokers. The new cap would encompass all payments that plans can pay brokers. 
   
   
2. The proposed rule would generally prohibit insurers from paying third-party marketing organizations volume-based bonuses for steering a certain number of enrollees to its plans. 
   
   
3. Under the proposed rule, plans would be required to issue a mid-year notice to enrollees, informing them of any supplemental benefits they have access to in their plan that they have not used. This would ensure benefits are actually used and not simply used as marketing tactics, CMS said. 
   
   
4. CMS is proposing new restrictions of marketing of supplemental benefits for chronically ill enrollees, requiring plans to disclose that these benefits are only available to beneficiaries with certain diagnoses, not all Medicare beneficiaries. 
   
   
5. The proposed rule would reduce the number of plans able to enroll beneficiaries dually eligible for Medicare and Medicaid outside of the open enrollment period. This would crack down on year-round aggressive marketing of D-SNP plans, CMS said. 

The proposed rule is open for public comment until Jan. 5. See the full fact sheet from CMS here.