NAIFA tells CMS that compensation cuts may ‘run afoul’ of existing federal regulations
In a letter to the Centers for Medicare and Medicaid Services, Kevin Mayeux, chief executive officer of the National Association of Insurance and Financial Advisors (NAIFA), expressed strong concerns over recent actions by several Medicare Advantage organizations to eliminate agent and broker compensation for specific products and member assessments.
“These abrupt decisions are extremely detrimental to the personalized services Medicare Advantage agents provide to millions of Medicare beneficiaries who rely on their expert advice,” Mayeux said. “NAIFA members are dedicated to ensuring that consumers have access to robust healthcare and prescription drug options that best meet their needs. The level of work and technical knowledge required to perform the job successfully, not just during enrollment periods but throughout the entire year, merit fair compensation.”
Mayeux also raised legal concerns, pointing to 42 CFR 422.2274(c)(5), a federal regulation that mandates Medicare Advantage organizations to report their intended agent and broker compensation rates to CMS by the last Friday of July. Once reported, organizations are prohibited from altering these rates during the plan year. NAIFA believes the recent elimination of compensation violates this regulation.
Fair compensation is essential for agents and brokers to continue providing the high level of expertise and service that Medicare beneficiaries depend on. "The announcements by Medicare Advantage organizations to eliminate compensation undercut the agents’ abilities to serve their clients and could have the unfortunate impact of reducing consumer access to personalized support,” Mayeux said.
Mayeux cited the indispensable role agents and brokers play in guiding consumers to the plans that best meet their healthcare needs through services that include educating beneficiaries about Medicare options, researching provider networks and drug formularies, and offering ongoing support throughout the year. Eliminating compensation for these critical services leaves beneficiaries without the guidance necessary to make informed decisions, potentially reducing access to care.
“NAIFA would like to continue the conversation with CMS to discuss the implications and legality of these actions. If Medicare Advantage organizations contemplated any level of commissions to agents and brokers as reported to CMS – a fair assumption given the organizations rely on a large network of agents and brokers to sell their products – we believe that the decision to suspend compensation entirely for certain products violates federal regulations,” Mayeux said.