Last year, Medicare warned insurers about using tactics that tricked seniors into buying policies without their consent or that lured them in with questionable information.
This week, the Biden administration went a step further, proposing rules that would halt some of the most common — and controversial — marketing tactics reportedly employed by Medicare Advantage and Medicare prescription drug plans.
The Centers for Medicare & Medicaid Services wants to beef up protections to prevent Medicare members from being misled into switching plans based on erroneous information.
“CMS’s experience with reviewing complaints and in listening to recorded calls revealed many instances where agents and brokers have failed to provide enough information, confused beneficiaries, and, most concerning, provided inaccurate information about plan benefits,” the agency wrote.
Among the changes set forth in the draft rule, plans — or third-party marketing organizations acting on their behalf – would be barred from widely touting Medicare Advantage plan benefits that are available only in a limited area or to a restricted number of beneficiaries. Also targeted is the practice of dangling “savings” to a prospective member that are actually based on a comparison with the expenses borne by an uninsured person.
Another marketing tactic CMS seeks to curtail is the robo-call. Plans would need to notify enrollees annually, in writing, of the ability to opt out of phone calls regarding plan business.
They would also have to ensure that their agents explain the effects of enrollment choices on current coverage and share the person’s health history before asking them to switch plans by phone. Selling and reselling of beneficiary contact information may also be considered misleading marketing.
CMS even wants to gain more control over how its brand is used in Medicare plan advertising, ranging from store fronts to notices and postcards, as well as TV spots, print, online and social-media marketing. Take, for example, ads that flaunt Medicare’s logo in large type, while burying the disclaimer that the information at hand isn’t endorsed by the federal government in minuscule font.
CMS said it would hold plans accountable if it deems the Medicare name or CMS logo have been used in a misleading way. Advertisers would also be barred from using promotional language like “best” or “most” – including in taglines and logos – without including documentation to back up the claims.
The latter rules were inspired, CMS explained, by complaints from beneficiaries who mistakenly believed they were calling Medicare rather than a private Medicare Advantage or Part D plan or its agent or broker, based on a flyer seen. There has been an increase of third parties in the marketplace, it said.
The draft rule also seeks to require the creation of marketing in alternate languages to become standard, as well as to add a health equity index to the Star Ratings Program, which gives Medicare Advantage and Part D plans a public score to guide consumer choices.
Questions have been building for some time about whether Medicare Advantage plans offer quality care and whether they’re becoming a den for scammers using high-pressure sales tactics. Earlier this year, congressmen began flagging predatory Medicare Advantage marketing tactics.
In September, the chair of the House Ways and Means Health Subcommittee, Rep. Lloyd Doggett, (D-Texas), led 30 other Democratic members in recommending changes to the program that included limits on aggressive and misleading marketing.
In a November report, the Senate Finance Committee argued for enacting tighter controls around the marketing tactics plans use to sign up new members. Its chair, Sen. Ron Wyden (D-Ore.), led a probe in August, requesting information from 15 state regulatory bodies, including examples of false or misleading marketing materials.
CMS tightened marketing requirements for plans last year, but complaints from beneficiaries about the marketing of plans have risen to about 40,000 last year, up from about 5,700 in 2017.
These complaints ranged from beneficiaries being enrolled without any contact with a health plan, cross-selling and misleading information about provider networks, reimbursements, benefits and premiums.
CMS this spring required marketers to include disclaimers in ads about plan information, to cut down on deceptive sales practices.
Additionally, CMS issued a warning in October that Advantage plans would be subject to closer scrutiny in 2023. Such practices are especially prevalent during the open-enrollment period, which runs roughly from mid-October through the first week of December.
