In mid-September 2008, the Centers for Medicare and Medicaid Services (CMS) issued updated marketing and sales guidelines for Medicare Advantage (MA) and prescription benefit programs (PBP). Below, you will find an outline of the new regulations, separated into two main sections. The first section includes a list of the new marketing guidelines, and the second deals with compensation and testing guidelines. CMS is utilizing a secret shopper program in order to ensure regulation compliance. Just click on the link and for a short description of what the provisions mean for your business.
Sales and Marketing Guidelines
- Nominal gifts
- Providing meals
- Sales/marketing at educational events
- Sales/marketing in health care settings
- Scope of appointment
- Unsolicited contacts
Compensation and Testing Guidelines
- Agent training and testing
- Compensation structure
- Plan reporting of terminated agents
- Use of certified agents
Sales and Marketing Guidelines
CMS has prohibited the use of names and/or logos of co-branded network providers on membership plan identification cards. Additionally, organizations must include the following disclaimer on all marketing materials that include the name and/or logo of a co-branded network partner: “Other [pharmacies/physicians/providers] are available in our network.” Beneficiaries need to understand the availability of multiple network providers and are not to be misled to believe that the co-branded network provider is the only provider available. MA organizations may include provider names and/or logos on the member identification related to member selection of specific providers or provider organizations. For example, in some plans enrollees may select a primary care provider or particular group of service delivery providers, such as a hospital network. Because the beneficiary has made the decision to choose a provider, that provider’s name or logo may appear on the card.
Agents may not offer information on other products to beneficiaries during Medicare sales activities or appointments. In the event that the beneficiary specifically requests information about other products, the agent must make a separate appointment, which is to take place at least 48 hours after the initial appointment or sales activity. Agents are permitted, however, to leave plan materials (not including enrollment applications) if requested by the beneficiary. Plans are allowed to sell non-health-related products on inbound calls only when a beneficiary requests information on non-health-related products.
: Organizations can offer gifts to potential enrollees as long as the item is worth $15 or less, based on the retail purchase price of the item regardless of the actual amount paid for the item.
During any marketing or sales event where MA or PBP plans are being discussed and/or plan materials are being distributed, agents and other Medicare organizations may not provide meals to beneficiaries. Light snacks (e.g., fruit, raw vegetables, pastries, cookies, cheese and crackers, chips, yogurt, nuts, etc.) are permitted.
Sales activities, such as the distribution of marketing materials or plan applications, may not be conducted at educational events. CMS has defined an educational event as one that provides general information on health and wellness or on Medicare in general, so they may not be used to steer a beneficiary toward a specific plan. Educational events are events that are promoted to be educational in nature and have multiple vendors (e.g., health information fairs, conference expositions, community-sponsored events, etc.). Events may be sponsored by plans or outside entities. Furthermore, organizations must include a disclaimer on all marketing materials for educational events that specifically states that the event is “educational only and information regarding plans will not be available.”
Agents may not conduct marketing activities in health care settings, such as doctors’ offices waiting rooms or hospitals, except in common areas (e.g., hospital or nursing home cafeterias, recreational rooms, conference rooms, etc.). For pharmacy counters located inside retail stores, the common area refers to any space outside the place where patients receive medication or discuss medication with pharmacists.
Plans are not allowed to participate in any kind of sales activity, including dropping off enrollment applications, in areas where beneficiaries receive health services. If an agent would like to schedule an appointment with a prospect who is living in a long term care facility, they can only do so at the express invitation of the beneficiary.
Before any marketing appointment, the agent must outline the scope of the appointment, and the beneficiary must agree to it. This exchange must be documented either by sound recording or written record. For example, if a beneficiary attends a sales presentation and agrees to a private appointment, the agent should have a form specifying the products that will be discussed during the appointment. Appointments made by phone must be recorded, or a scope-of-appointment form should be sent to the beneficiary, who will return the form before the appointment begins.