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May 08, 2008 at 11:54 AM
The Centers for Medicare and Medicaid Services has unveiled a draft of strict new Medicare Advantage and Medicare Part D prescription drug plan regulations.
The draft regulations also would:
- Set new standards for agents selling Medicare Advantage programs.
- Subject Medicare Advantage plan agents to state oversight.
- Give CMS the authority to fine an insurer up to $25,000 per beneficiary if an agent violated the new rules.
- Revise procedures affecting how carriers handle members of special needs plans and low-income prescription drug plan members.
The marketing provisions of the proposal would require that insurers selling Medicare Advantage and Medicare drug plans through independent agents stick with state-licensed agents. Medicare Advantage carriers would have to report to states, “in a manner consistent with state appointment laws,” that they are using state-licensed agents, according to the text of the draft regulations.
The marketing provisions also would bar door-to-door marketing and cold-calling, and they would tighten the rules governing commissions for independent agents and brokers.
The proposed commission rules appear to be stricter than rules that members of America’s Health Insurance Plans, Washington, suggested in March.
Carriers would have to offer level commissions for different products and years.
The CMS added the level-commission rules to prevent churning, according to Abby Block, director of the CMS Center for Beneficiary Choices and Medicaid Services.
