Yesterday, NAHU CEO Janet Trautwein testified in front of the National Association of Insurance Commissioners during NAIC’s Summer Meeting. In her testimony, Trautwein discussed the recent Medicare marketing final rule issued in May.

The final rule attempts to “protect Medicare beneficiaries by ensuring they receive accurate and accessible information about Medicare coverage.” To do this, the rule strengthens oversight of third-party marketing organizations (TPMOs) to “detect and prevent the use of confusing or potentially misleading activities to enroll beneficiaries.” One way CMS is looking to increase this oversight is by requiring that any telephonic “marketing” calls with beneficiaries or potential beneficiaries be recorded. While the intention of this rule is to stop fraudulent or misleading actors – such as certain call centers – from manipulating Medicare beneficiaries, the rule’s overly broad definition of a TPMO includes licensed agents and brokers.

Beneficiary dissatisfaction is not generally with their agent of record; it is with call centers that solicit beneficiaries to switch plans that do not necessarily meet their needs. Including licensed agents and brokers in the definition of TPMO needlessly subjugates responsible actors to difficult and burdensome telephonic recording requirements.

Trautwein brought this issue to the NAIC’s attention, highlighting the potential damage that this regulation could cause if it is implemented as written. These new regulations will likely discourage many licensed and certified agents and brokers from representing Medicare Advantage and prescription drug plans, leaving millions of Medicare beneficiaries without access to professional assistance in their enrollment.

The cost of setting up a HIPAA-compliant audio recording system with adequate and protected storage capabilities far exceeds the abilities of many of these licensed and certified agents who are now facing a decision as to whether to participate in this fall’s Annual Enrollment Period. An estimated 100,000 licensed and certified independent agents and brokers certify each year to offer Medicare Part C and D plans; without these licensed and certified agents assisting in enrollments, Medicare beneficiaries will have few choices in finding accurate enrollment assistance and will be led directly to the bad actors that this rule seeks to protect them from.

The NAIC is currently reviewing a model state regulation to address improper marketing of insurance plans and unscrupulous actors in the health insurance market. Trautwein’s testimony will help to shape the language of the model rule and NAHU will be providing written comments to the NAIC to advocate on behalf of the role agents and brokers play in the health insurance market.