CMS has released the 2016 Medicare Marketing Guides. The Guidelines are for use by Medicare Advantage Plans (MAs), Medicare Advantage Prescription Drug Plans (MA-PDs), Prescription Drug Plans (PDPs), 1876 Cost Plans and licensed sales agents representing those plans.
Our industry leading Compliance Department has reviewed this document and pulled several sections that are most applicable to agents and that have either been added or amended since 2015. You may note these changes in red below.
- Materials, except for websites, that only indicate the products (e.g., HMO, PPO, or PDP) an agent sells do not have to be submitted to CMS. Plans/Part D Sponsors must submit agent/broker websites that reference specific MA/Part D products in HPMS.
- The Star Ratings information document must be distributed when the SOB and/or the enrollment form is provided to beneficiaries.
- After giving consent for electronic mailings, the enrollee must be able to opt out and receive hard copy mailings again upon request
- Call their current MA and non-MA enrollees or use third-parties to contact their current MA and non-MA enrollees about MA/Part D plans. Examples of allowed contacts include, but are not limited to, calls to enrollees aging-in to Medicare from commercial products offered by the same organization and calls to an organization’s existing Medicaid/MMP plan enrollees to talk about its Medicare products.
- The Plan/Part D Sponsor must document the scope of the agreement 48 hours prior to the appointment, when practicable. Distinct lines of plan business include MA, PDP and Cost Plan products. If a Plan/Part D Sponsor would like to discuss additional products during the appointment in which the beneficiary indicated interest, but did not agree to discuss in advance, the Plan/Part D Sponsor must document a second scope of appointment (SOA) for the additional product type to continue the marketing appointment.
- Any technology (e.g., conference calls, fax machines, designated recording line, pre-paid envelopes, and email) can be used to document the scope of appointment.
- 120.2 – Plan Reporting of Terminated Agents 42 CFR 422.2272(c)-(e), 422.2274(f), 423.2272(c)-(e), 423.2274(f) Plans/Part D Sponsors must report the termination of any agents/brokers to the State (adhering to state requirements for reporting terminations to the state) and the reasons for the termination, if State law requires the reasons to be reported. Plans/Part D Sponsors must report for-cause terminations to CMS Account Managers, via email or letter. Plans/Part D Sponsors must also report to CMS Account Managers any sales of Medicare products which were made by agents without a valid license.
- Referral/Finder’s Fees: Referral/Finder’s fees paid to agents and brokers, including independent, employed, and captive agents and brokers, may not exceed $100 ($25 for PDPs). This amount is not reasonably expected to provide enough financial incentive for an agent or broker to recommend or enroll a beneficiary into a plan that is not the most appropriate for the beneficiary’s needs. Note: Non-agents/brokers receiving referral fees are not subject to the general compensation rules (e.g., training/testing/licensure).
- Commissions: Plans/Part D Sponsors have the option to pay the agent or broker either full or pro-rated compensation for initial enrollments that are effective later than January 1 and the enrollees have no prior plan history. However, if the Plan/Part D Sponsor pays a full initial compensation and the enrollee disenrolls during the contract year, the Plan/Part D Sponsor must recoup a pro-rated amount for all months the beneficiary is not enrolled. This would include months prior to the enrollment. For example, a beneficiary ages into Medicare and elects an MA-PD plan (Plan A), effective April 1. The beneficiary moves and is eligible for a special enrollment period. The beneficiary elects a new MA-PD (Plan B), effective November 1. Plan A must recoup 5/12ths of the initial compensation (January through March and November through December) to account for the months the beneficiary was not enrolled in Plan A. Since the beneficiary had prior plan history when enrolled in Plan B, Plan B may only pay a pro-rated initial compensation equal to 2/12ths (November through December).
You may click here to review and download the official CMS document. For more information, please contact our Compliance Department for updates from the carriers on their interpretations/guidelines for 2016.