CMS published their 2018 Medicare Marketing Guidelines a couple weeks back. The document is 124 pages long, so there’s a lot to digest and not 100 percent of the material is totally relevant to agents, so I like to talk about what’s DIFFERENT from one year to the last and focus on what’s most important for insurance agents to know.
Since AHIP comes out BEFORE the MMG, that training doesn’t necessarily capture the “up-to-the-minute” guidelines (although I think AHIP does publish some updates). Similarly, there isn’t always a consensus on how the Health Plans and Part D Sponsors will view the changes. Generally, it takes a few weeks before the carriers inform agents how they are viewing things.
I’ll try and start from the most important and move to the less critical updates in case you just can’t make it through the entire thing!
1. Section 70.4.3 – Scope of Appointment. The requirement of documenting the Scope of Appointment 48 hours prior to the appointment is removed. The guidelines now simply say: “prior to the appointment,” which we interpret to mean that “same day Scopes” are compliant for ANY reason. Additionally (and less important, but potentially significant), the wording around filing BRC’s was changed, whereas some BRC’s would not require filing. That said, the wording seems to contradict itself a bit where it then says BRC’s used to document consent to contact must be filed (which is pretty much the definition of a BRC). Our interpretation is that when a BRC is independent from plan-specific marketing material (like a generic piece), it does not need to be filed with CMS. We did get confirmation from a major carrier on this opinion, however, we’d refer the agents to their health plans for interpretation in advance since opinions could vary on this.
2. Section 120.4.4 – Payments other than Compensation. This is a bit of a long-winding road, so I’ll give a little context. In January, CMS, under the prior administration, put out a draft of the MMG which stated that admin fees (overrides) could NOT be based on enrollment and had to be based on things other than enrollment. This would have impacted all levels of agencies (GAs, MGAs, SGAs, LMOs, GMOs, RMOs, FMOs, NMOs, and so forth), since overrides were ALWAYS based on enrollment. The FINAL MMG specifically allows admin fees (overrides) to be based on enrollment and must be Fair Market Value (FMV). I was actively involved in this one and had the opportunity to meet with CMS in Washington to discuss the role of the agent and the role of the upline.
3. Section 120.4.1 – General Rules Regarding Compensation. This states again that Plans/Part D Sponsors may not pay agents/brokers who have not been trained and tested. This is new. In rare cases, carriers might have considered brokers vested who did not recertify, but this clarifies that. Hard to say exactly what the implications are, however, any changes to the General Rules Regarding Compensation are significant to me!
4. Section 100.7 – Third-Party Websites. This is a lot less onerous than the “draft” MMG language that came out in January that would have required virtually all websites owned by agents who marketed MA/PDP to be multi-plan filed. While CMS did provide guidance to Health Plans and PDP Sponsors via memos, this section of the MMG did not previously exist. It defines third party websites and the circumstance which require filing. Specifically, the sites are not required to be filed if they do not include any plan-specific information. The Plans/PDP sponsors are still required to ensure that third-party websites (even those not filed) do not provide misleading information and don’t use prohibited terminology (like unsubstantiated absolute superlatives). Website may request, but NOT REQUIRE, health status information. So, the definition of Third-Party Websites is extremely broad, but the filing requirements are fairly limited.
5. Section 80.4.1 – Telephonic Contact. This section was previously 70.6 and moved to 80.4.1. It now allows a Health Plan or PDP sponsor to return a phone call if a Medicare beneficiary sends them an email requesting a call. Previously, it was limited to returning phone messages or voicemail in 70.6.
6. Section 70.1 – Electronic Communication Policy. This section was previously called “Unsolicited Electronic Communication Policy” and was found in Section 70.4. There are major changes to this section. For example, previously, CMS explicitly stated that “Plans/Part D Sponsors are prohibited from renting or purchasing email lists to distribute information about MA, PDP, or Section 1876 cost plans, and may not send electronic communications to individuals at email addresses or on social media obtained through friends or referrals.” This doesn’t appear in the current MMG. The new requirements are that “Marketing” appears in the subject line and that the consumer has the ability to opt out of future communications. Of course, CAN-SPAM regulations would apply. Section 70.1 provides the requirement for “Opt out”. Appendix 5 – Disclaimers clarifies that “Marketing” must appear in the subject line when sending email to POTENTIAL enrollees.
7. Section 70.4.1 – Educational and Marketing Events. Plans are no longer required to file events in HPMS in advance. However, Plans are still required to maintain records of formal and informal sales events. Agents should check with their carriers on their requirements to document their events. The implication here is that the process should be streamlined due to not having the requirement that CMS get a record of the event in advance (agent name, event, carrier, day, time, venue, etc.) CMS also removed section 70.9.1 (Notifying CMS of Scheduled Marketing Events), since this section is moot. That said, the carrier should provide guidance on the process for cancelation for good business practice.
8. Section 30.10 Star Rating Information from CMS. Plans and Part D sponsors are not permitted to display or release their Star Ratings information until CMS releases the Star Ratings on Medicare Plan Finder. In prior years, the plans would release their prior year Star Ratings, and then, change their material in the middle of AEP (generally in October) once CMS released the new Star Ratings. It’s not totally clear if this changes that procedure. What makes this a little confusing is that providing information on star rating is a required element for enrollment (Section 30.6). Hopefully, this means Star Ratings will come out sooner!
9. Section 110.1 – Promotional Activities. Maximum aggregate (annual) value for nominal gifts is now $75.
10. Section 30.5.1 – Multi-Language Insert. This section is removed.
11. Section 30.6 – Required Materials with an Enrollment Form. This no longer requires a multi-language insert.