CMS reins in Medicare Advantage plans

June 16, 2008

The Centers for Medicare & Medicaid Services is proposing regulations to control selling tactics used by Medicare Advantage and Part D plans to attract new customers.

A new rule proposed by the Centers for Medicare & Medicaid Services attempts to tighten regulation of Medicare Advantage and Medicare Part D prescription drug plans. The rule establishes marketing standards for selling plans and prohibits some hard-sell tactics. The rule also authorizes CMS to fine companies up to $25,000 for violations. Still, many consumer groups worry that the rule does not go far enough. "These regulations do nothing to prevent insurance companies from using high commissions and volume-based bonuses to encourage agents to enroll people with Medicare in substandard plans that provide inadequate financial protection, abysmal customer service, and poor access to providers," insisted Robert Hayes, president of the consumer-oriented Medicare Rights Center. CMS is accepting comments at http://www.regulations.gov/ through July 15.