The U.S. District Court for the Northern District of Texas has issued a stay preventing the Centers for Medicare and Medicaid Services (CMS) from implementing a new rule changing compensation rules for professionals providing products and services related to Medicare Advantage and Medicare Part D programs. NAIFA is not a party to the lawsuits, Americans for Beneficiary Choice et al. v. the U.S. Department of Health and Human Services et al. and The Council for Medicare Choice et al. v. HHS et al., but has been an outspoken critic of the rule since it was first proposed.

The CMS rule would classify fees agents and brokers receive for providing services beyond simple enrollment to Medicare Advantage plan enrollees as “compensation” under an existing compensation cap while only modestly increasing the cap. In effect, the rule would severely limit the ability of agents and brokers to be paid at fair market value for such things as training, customer service, agent recruitment, operational overhead, and assistance to clients completing health risk assessments. The inevitable result would be that these services would be reduced or eliminated, harming consumers who rely on agents and brokers for their expertise and guidance.

A letter sent by NAIFA President Tom Cothron to CMS in January urged regulators to reconsider the proposed rule in its entirety and to work with NAIFA and health plan providers to accurately assess the fair market value of the services agents and brokers provide. When the Centers nonetheless moved forward with the rule, several organizations filed suit. The Court’s ruling provides “universal relief” that applies to all agents and brokers, even if they are not parties to the lawsuit.