CMS Puts the Kibosh on Misleading Medicare Advantage Sales Pitches
https://www.medpagetoday.com/special-reports/exclusives/101348
“Secret shoppers” found that 80% of agent calls with clients were inaccurate or insufficient
After reviewing thousands of complaints about “confusing, misleading, and/or inaccurate” Medicare Advantage ads, and using “secret shoppers” to document deceptive telephone sales pitches, the Centers for Medicare & Medicaid Services (CMS) announced it is putting its foot down on Thursday.
Kathryn A. Coleman, director of the agency’s Medicare Drug and Health Plan Contract Administration Group, said in a three-page letter that CMS is immediately enhancing its review of marketing materials, which must be submitted under its regulatory “File and Use” authority for Medicare Advantage and Part D drug plans, and “may exercise its authority to prohibit” their use.
Currently, Medicare Advantage marketing materials may go live 5 days after submission, provided that the company submitting them “certifies the material complies with all applicable standards.”
However, starting January 1, Coleman said that no television advertisements will qualify to be submitted under its “File and Use” authority, meaning that the ads will not run until CMS approves them. MedPage Today reached out to CMS for a response but did not hear back by press time.
“They’re trying to find a way to put the brakes on misleading advertising,” said John Greene, vice president of Congressional Affairs for the National Association of Health Underwriters.
Christopher Westfall of Senior Savings Network, which is licensed to sell health plans in 47 states, noted that “we hope that finally the regulators will hold these plans and call centers accountable. We have clients call us all the time telling us they have no idea what they were signed up for, and were shocked that they were not on original Medicare any longer. Now they were in an Advantage plan, with all kinds of restrictions.”
In her letter, Coleman said that the agency is “particularly concerned with recent national television advertisements promoting MA [Medicare Advantage] plan benefits and cost savings, which may only be available in limited service areas or for limited groups of enrollees, overstate the available benefits, as well as use words and imagery that may confuse beneficiaries or cause them to believe the advertisement is coming directly from the government.”
CMS is also reviewing recordings of agent and broker calls with potential enrollees, and continuing its secret shopping of marketing events “by reviewing television, print, and internet marketing and calling related phone numbers and/or requesting information via online tools.”
The agency approved a final rule this spring that requires all Medicare Advantage agents, brokers, and third-party marketing organizations to record all their calls with potential enrollees “in their entirety, including the enrollment process.” In her letter, Coleman said reviews of recordings will continue.
“Our secret shopping activities have discovered that some agents were not complying with current regulation and unduly pressuring beneficiaries, as well as failing to provide accurate or enough information to assist a beneficiary in making an informed enrollment decision,” she wrote.
Coleman also noted that the agency will take “compliance action against plans for activities and materials that do not comply with CMS’ requirements.” However, the letter did not specify what form compliance action might take.
Furthermore, she wrote that “CMS may, at any time, determine an accepted material is not in compliance with our rules and require modification and resubmission.”
It also will review “all marketing complaints” received during the annual enrollment period, which runs from October 15 to December 7, and will target its “oversight and review on MA organizations and Part D sponsors with higher or increasing rates of complaints.”
Greene said CMS shared with his organization some of what they were finding through the secret shopper program, “and some of the stories they told us were just dreadful.”
One example of what he considered deceptive is any ad that tells targeted beneficiaries that they will get money back in their Social Security checks if they enroll in a Medicare Advantage plan.
“That [claim] applies to an extremely limited number of people in certain zip codes,” Greene explained. “The people who are the so-called agents or the call centers that receive calls from those ads have this expression, ‘turn ’em and burn ’em,'” meaning rapidly enrolling a beneficiary in a plan without spending the time to find out what their needs are.
“That is not the sort of behavior that independent agents who are not involved in these call centers or broadcast ads would do,” he emphasized. “No independent agent spends 20 minutes with a client, a beneficiary. It takes several hours to go through their drug history. What pharmacies do they use? Do they use mail order? Their health status? Do they travel? What’s their financial tolerance? There’s all sorts of considerations as to whether they recommend a Medicare Advantage plan or a medical supplement.”
In an accompanying FAQ, CMS noted that “agents failed to provide the beneficiary with the necessary information or provided inaccurate information to make an informed choice for more than 80% of the calls reviewed,” giving examples such as “beneficiaries being told that if their medication was not on the formulary, the doctor could tell the plan and the plan would simply add it; or incorrectly stating that ‘nothing would change’ when beneficiaries asked if their current health coverage would stay the same.”
Greene said that his organization and many consumer groups “have been complaining for years” about misleading claims and ads, like the one featuring Joe Namath.
“But what changed is that the pandemic allowed for special enrollment periods for COVID-infected individuals, and that allowed the ads to run year-round. So naturally, complaints escalated,” Greene said. “That got the attention of [CMS administrator] Chiquita Brooks-LaSure and her deputies that they had to do something to reduce the complaints.”
He noted that some plans may advertise that their “extra benefits” include rides to the doctor, dental coverage, hearing aids, and home meals. But after the beneficiary enrolls, they learn that only a small portion of those costs are covered, or they have to go to certain providers who aren’t near their home, or that there are co-pays and deductibles.
“Plans are recognizing that this is a problem that they need to be more transparent about,” said Greene. “Sometimes they’ll give you a card and you can use it in any of those buckets that you want to, but once you spend it, right, it’s gone. And then you’re on the hook for the rest. There’s now a recognition that they have to do a better job of explaining exactly what these benefits are, how far they go, and what they actually cover.”
The CMS letter is part of a wide-ranging effort by many federal agencies to crack down on myriad Medicare Advantage plan practices, including delays and denials of care through prior authorization requirements, and concerns that dozens of plans fraudulently inflated the severity of their enrollees’ illnesses to receive billions of dollars more from the Medicare Trust Fund that were not needed for their patients’ care.
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