The final rule is quite extensive, revising the MA and Part D regulations related to:
- marketing and communications
- the criteria used to review applications for new or expanded MA and Part D plans
- quality ratings for MA and Part D plans
- medical loss ratio reporting
- special requirements during disasters or public emergencies
- how MA organizations calculate attainment of the maximum out-of-pocket (MOOP) limit for Parts A and B services
- the use of pharmacy price concessions to reduce beneficiary out of pocket costs for prescription drugs under Part D
- special needs plans, related to enrollee advisory committees, health risk assessments, and ways to improve integration of Medicare and Medicaid
While each of these changes is important, the marketing and communications oversight changes could have a big impact on agents who sell Medicare Advantage and Part D plans.
From the CMS fact sheet:
CMS is finalizing changes to marketing and communications requirements that will protect Medicare beneficiaries by ensuring they receive accurate and accessible information about Medicare coverage. These include strengthening oversight of third-party marketing organizations to detect and prevent the use of confusing or potentially misleading activities to enroll beneficiaries in MA and Part D plans, reinstating the inclusion of a multi-language insert in all required documents to inform beneficiaries of the availability of interpreter services, codifying enrollee ID card standards, requirements related to a disclaimer for limited access to preferred cost sharing pharmacies, plan website instructions on how to appoint a representative, and website posting of enrollment instructions and forms.
At first glance, none of this language sounds like a big deal, but it is. Agents and brokers are included in the definition of “third-party marketing organizations,” (TPMO) and “strengthening oversight” means, in part, that CMS will now require agents to record all marketing calls with both clients and prospects in which Medicare Advantage and Medicare Part D plans are discussed.
From the Final Rule:
Section § 422.2274 (g)(2)(ii) of the final rule relates to “Agent, broker, and other third-party requirements” and says that MA plans “must ensure the TPMO”:
(ii) Records all calls with beneficiaries in their entirety, including the enrollment process.
Again, agents and brokers are considered TPMOs, or third-party marketing organizations, so that means that, going forward, we will need to record our calls with beneficiaries relating to Medicare Advantage and Part D plans. We know that some agents who work with AHCP already have software that allows them to record all client and prospect calls, but many do not, so this will be a big change for the majority of independent agents who market these products.
In addition to the requirement that agents record all calls with Medicare beneficiaries, the final rule in Section § 422.2274 (g)(3) contains a new disclosure requirement. The third-party marketing organization (TPMO) must, when applicable:
(i) Disclose to the beneficiary that his or her information will be provided to a licensed agent for future contact. This disclosure must be provided as follows:
(A) Verbally when communicating with a beneficiary through telephone.
(B) In writing when communicating with a beneficiary through mail or other paper.
(C) Electronically when communicating with a beneficiary through email, online chat, or other electronic messaging platform.
Agents use a variety of lead-generation tools, but it appears that, regardless of which tools you use, this disclosure will be necessary if you intend to have any future contact with the prospect or client.
While the marketing guideline changes, including the call recording and disclosure requirements, are for calendar year 2023, they go into effect October 1, 2022, just before the start of the 2023 Annual Election Period for Medicare Advantage and Medicare Part D plans.
Further Clarification Needed
When hearing about the new rule, agents immediately ask two questions:
- Does this rule apply to me?
- Do I have to record calls with existing clients?
The answer to both of these questions, at least at this time, appears to be “yes.” However, the National Association of Health Underwriters (NAHU) is in discussions with CMS and reports in its May 20 Washington Update on a recent conversation the association had with CMS officials from the Division of Surveillance, Compliance and Marketing. NAHU asked “whether this requirement should apply to an agent’s current book of business in which the beneficiary has voluntarily entered into a relationship with the agent,” noting that client “dissatisfaction is not generally with their agent of record; it is with call centers that solicit beneficiaries to switch plans that do not necessarily meet their needs.” For that reason, NAHU “reiterated our belief that the requirement should be on call centers, not on agents and brokers with established relationships with their Medicare clients.”
As of now, CMS has made no changes to the final rule, but the two parties “agreed to connect again,” and NAHU says that CMS officials “seemed willing to reconsider agents with an ongoing relationship with beneficiaries as their agent of record as part of their current book of business.”
If CMS makes any modifications to the final rule, we will be sure to let you know. In the meantime, agents should begin preparing to be in compliance by October 1.