Be aware of many changes and challenges this year
BY MARGARET STEDT
For all of those who sell, offer products and provide services in the Medicare arena, this year has brought the most changes and challenges that we have seen in this market for many years. Thanks to the Inflation Reduction Act (IRA) signed by President Biden on Aug. 16, 2022, there are many changes to Medicare, Medicare Marketing and Sales Regulations and in the Dual Eligible Special Needs Plan.
Everyone is scrambling to make sure they are selling and servicing compliantly, determining the plans to offer and being “ready to sell.” These changes are not only changing how we do business but also affects the bottom line of our business in both hard and soft dollar costs — with a short period of time for learning curves and implementation.
The IRA is the beginning of the implementation of many years of substantial changes to the Medicare Part B and Part D plans (Stand-alone and Medicare Advantage Plans.)
Changes will begin this year and will continue through 2030 and include the following:
2022: Health and Human Services (HHS) is authorized to begin negotiations of the prices of 10 high-cost prescription drugs. The new negotiated prices go into effect in 2026. Note that the number of drugs that will be negotiated will increase to 15 in 2027 and 2028 and then go to 20 in 2029 and every year thereafter.
2023: Good news for applying for “Extra Help.” The income threshold to qualify for a subsidy to help pay for the Part D out-of-pocket costs will be increased from 135% of the federal poverty level (it was $18,347 in 2022) to 150% (was $20,385 for an individual in 2022).
Insulin: Any insulins that are covered by the plans will be capped at $35 in all phases. That means the covered individual will not pay more than $35 for a one-month supply of each insulin product covered even if they have not met their deductible. If the cost-share for the tier the insulin is on is less than $35, they will pay the tier cost-share (the lesser amount). A number of plans will continue to offer the Senior Savings Insulin Saving Program for select insulins. Please always check to see which plans offer this benefit.
Vaccines: Most vaccines will be free for Medicare enrollees beginning in 2023. Vaccines such as Shingrex for shingles that are covered under the plans will be $0 copay even if the individual hasn’t met their deductible and in the Initial, Gap and Catastrophic phases. Note this applies to any vaccine that is on the CDC Immunization Recommendation List for Adults (over age 18) that is covered by the plan. There may be a separate vaccine administration fee at some pharmacies. Not all pharmacies provide and/or administer vaccines. Please always check the plan benefits and formularies.
2025: The total annual out-of-pocket spending on prescription drugs under Medicare (for stand-alone plans or Medicare Advantage plans) will be capped starting in 2025 at $2,000.
Some additional provisions apply to the Part D premiums:
The premiums for Medicare Part D plans will not increase more than 6% a year through 2029.
Beginning in October 2022, if the price of a Part D prescription drug is raised more than the rate of general inflation, the drug manufacturer will have to rebate Medicare the amount of the increase that is higher than the inflation rate.
The Secretary of HHS will be authorized to make a one time adjustment to the Part D premium percentage in 2030.
Special Needs Dual Eligible Plan (D-SNP) Change
CMS is not renewing “look alike” D-SNP (Special Needs Plans for Dual Eligibles) for next year nationwide. Instead, CMS has asked all health plans to transition current “look alike” members into a Medicare Advantage Prescription Drug Plan (MAPD) plan that has a projected enrollment of less than 80% of dual-eligible individuals. Each carrier is providing information regarding which plans will be available for agents to market and to which plans by county the Dual Eligibles will be mapped to or disenrolled from. Contact your carrier representative for more information regarding the plans and the mapping.
CMS Marketing Rules Changes as of Oct. 1, 2022
By far the biggest challenge this year is the new Medicare Marketing Rules that affect agents, carriers and third party marketing organizations (TPMO). CMS views agents as included in the definition of a TPMO. Because of so many complaints about misleading benefit information (over 40,000) received by CMS, they decided on a broad stroke basis to require all agents follow the TPMO rules requiring a recording of all calls that relate to marketing i.e., sales and servicing of Medicare Advantage and Prescription Drug plans. This includes scheduling of appointments and other discussion of benefits.
If an individual refuses to be recorded, we must end the call. However, you may continue the discussion by email or meet in person.
In addition, CMS has required that agents add the following disclaimers to all marketing materials including our emails and text messages:
“We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.”
To add to the difficulty of finding and implementing a new call recording system and learning to use it effectively, carriers are not all in agreement with the interpretation of the marketing rules. Are carriers required to record or not record zoom calls? Or can they continue the call if the Medicare beneficiary refuses to be recorded? Check with your carriers for their requirements but make sure to follow the CMS rules!
The National Assoc. of Health Underwriters (NAHU), National Association of Insurance and Financial Advisors (NAIFA) and the other agent organizations have requested clarification of the marketing rules from CMS. (The clarifications are pending approval and release as of the writing of this article.)
Please be aware that NAHU together with other agent organizations such as NAIFA have been meeting with and sending comments and formal letters to CMS trustees regarding the marketing rules. There was a formal request to delay implementation of the call recordings and to review the decision to include agents in the definition of the TPMO. Unfortunately, CMS is still holding fast to its decision. Other measures are being undertaken via letter campaigns to our federal legislators to consider requests for legislative action.
I can speak for our community by saying we as agents feel strongly that we are being unfairly punished for the deeds of a few bad actors. These bad actors don’t seem to be held accountable by CMS and some carriers for their actions. CMS says they are cracking down, yet the misleading ads, unsolicited phone calls and bad behaviors continue!
This decision by CMS is leading many agents to reconsider being in the Medicare plan marketing space. This could lead to less agents being available to service the growing number of seniors and leaving the seniors to depend on the TPMO’s!
I strongly urge you as agents to follow the guidelines — do not go rogue by
not recording. I’m sure there would be unpleasant consequences.
As a Medicare focused agent, I will follow the guidelines.
I am thankful I have a Field Marketing Organization (FMO) that is providing me with the telephone recording technology and sales tools to meet those requirements, at no cost. I strongly urge you as agents to follow the guidelines — do not go rogue by not recording. I’m sure there would be unpleasant consequences.
For members of NAHU, information is being constantly updated in the member section for Medicare and with weekly updates. In a recent NAHU Washington Update, the organization noted:
“As the only trade organization representing professional agents and brokers who work with Medicare beneficiaries and Medicare products, NAHU is acutely aware of the far-reaching impacts this regulation will have on Medicare agents, their clients and the AEP. We will continue to update our Medicare Marketing Rule Resources page with any and all pertinent information that will assist you in complying with the rule.”
Please add your voice to the cause by joining NAHU at nahu.org. Help us protect you, your clients and our future in this business. It is with more voices that we will be heard!
MAGGIE STEDT is an independent agent that has specialized in the Medicare market for the past 21 years. She is currently Medicare chair of Orange County Association of Health Underwriters (OCAHU) and past president. She served as immediate past president of California Association Health Underwriters (CAHU now CAHIP). Stedt also serves as an ad hoc member of NAHU (National Association of Health Underwriters) Medicare Advisory Group. Contact: firstname.lastname@example.org