Proposed changes will protect seniors by reining in unchecked MA broker fees
Washington, D.C. (January 4, 2024) – Seniors enrolling in Medicare Advantage plans will be protected by a rule proposed by the Centers for Medicare and Medicaid Services (CMS) to eliminate administrative fees paid to brokers who market MA plans. The Alliance of Community Health Plans (ACHP) strongly supports CMS’ action, which supports consumer choice and caps broker compensation. The proposal, developed as part of ACHP’s MA for Tomorrow, eliminates “junk fees” that have risen to more than double the allowed broker commission limit and will remove brokers’ financial incentives to steer seniors to certain MA plans.
Brokers at large third-party marketing firms are currently motivated to put their thumbs on the scale and push seniors to plans that pay them the most, as opposed to the plans best suited to address a senior’s particular health care needs. In comments submitted to CMS, ACHP said it is “thrilled the Administration recognized the urgency to address perverse financial incentives, protect consumers from nefarious marketing practices and safeguard the Medicare Trust Fund.” With seniors currently having an average of 44 MA plans to choose from, a clearly established cap on broker fees is one-way seniors can be confident they are being informed about plans that provide coverage they can use.
“This proposed rule supports seniors’ ability to choose the MA plan that’s best for them,” said Ceci Connolly, ACHP’s president and CEO. “We appreciate the information local brokers provide to Medicare beneficiaries, but large, for-profit companies have turned the system into a financial arms race. This sensible adjustment makes coverage and care more affordable for seniors and taxpayers.”
CMS’ proposed rule comes on the heels of a supportive letter from the Senate Finance Committee and another letter from the House Energy and Commerce and House Ways and Means Committees pressing for action. The Senate Finance Committee also held a hearing on October 18 in which Sen. Mike Crapo (R-ID) stressed the need to “examine opportunities to empower effective insurance brokers who serve as key community-based resources and access points, including in the context of MA plan enrollment.” At the hearing, ACHP Board member and Security Health Plan CEO Krista Hoglund described how many large third-party marketing organizations use their influence for financial gain, rather than guiding seniors toward plans that will best meet their needs.
ACHP calls on CMS to protect MA consumers and quickly finalize a reasonable broker compensation cap.
The Alliance of Community Health Plans (ACHP) represents the nation’s top-performing nonprofit health companies, which serve tens of millions of Americans across nearly 40 states and D.C. ACHP member plans collaborate with providers on high-quality coverage and care — leading the industry in practical reforms, including MA for Tomorrow, our vision for the future of Medicare Advantage.
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