April 16, 2024  – The Centers for Medicare & Medicaid Services (CMS) announced a series of comprehensive policy updates for Medicare Advantage and Part D plans, set to take effect in the Contract Year 2025. These new regulations are designed to boost competition, enhance behavioral health service access, and curtail deceptive marketing practices, ensuring a fairer and more efficient marketplace for beneficiaries.

Central to the final rule is the establishment of stricter compensation structures for agents and brokers involved in Medicare plans. Under the new regulations, compensation will be standardized, with agents and brokers receiving a fixed amount regardless of the plan a beneficiary chooses. However, the new rule increases the compensation by $100 for initial enrollments into Medicare Advantage or Part D plans.

To address conflicts of interest, CMS is prohibiting certain contract terms between Medicare Advantage organizations, Part D sponsors, and third-party marketing organizations (TPMOs). Specifically, the rule bans agreements that offer volume-based bonuses for enrollments, a practice that has raised concerns about the integrity of beneficiary choices in the past.

“Competition within Medicare Advantage and Medicare Part D will provide consumers with meaningful choices among plans so they can select one that best meets their individual needs. Additional consumer protections will help people make the right decisions and get the coverage they want without hassles,” said HHS Secretary Xavier Becerra. “We know that increased competition is good for the marketplace. That’s why the Biden-Harris Administration continues to increase competition in health care and lower costs, helping build on steps the Administration has already taken as well as identify opportunities to further spur innovation.”

Further tightening marketing regulations, the new rule stipulates that TPMOs cannot share personal beneficiary data collected for marketing or enrollment purposes without the express written consent of the individual. This measure is intended to protect beneficiaries from deceptive marketing tactics that have plagued the system.

On the healthcare provision front, the rule makes significant strides in improving access to behavioral health services. A new facility-specialty provider category, Outpatient Behavioral Health, will be added to network adequacy evaluation standards. This category includes a range of specialists, such as marriage and family therapists, mental health counselors, and addiction medicine physicians, enhancing the network of providers available to beneficiaries. Additionally, Medicare Advantage plans are now required to include telehealth providers in this category to ensure broader access.

The rule also mandates Medicare Advantage plans to actively inform beneficiaries about available supplemental benefits. Plans must issue mid-year notifications detailing any unused supplemental benefits and explaining how to access them. This is part of a broader effort to ensure that beneficiaries fully utilize the services available to them.

Additionally, the rule updates policies related to special needs plans for dual-eligible beneficiaries, the Medicare Advantage Risk Adjustment Data Validation (RADV) appeals process, and the Medicare Part D medication therapy management program.

Through these updates, CMS is taking significant steps to ensure that Medicare Advantage and Part D plans serve the best interests of all beneficiaries, fostering a healthier, more equitable healthcare environment.

You can view the fact sheet on the final rule by clicking here.