Even the most well-intentioned government actions risk backfiring when undertaken without due care and deliberation. Incremental, focused change helps ensure outcomes that align with the best interests of citizens. As former state governors, one a Democrat and one a Republican, we understand that principle, one we worked to make a hallmark of our administrations in Kentucky and Louisiana.
Unfortunately, to judge by its aggressive and expanding intervention into the Medicare Advantage market, that’s a lesson the Centers for Medicare and Medicaid Services may have to learn the hard way.
We applaud CMS officials, along with Sen. Ron Wyden (D-OR) and his colleagues in the Senate Finance Committee, for steps they have taken to protect Medicare beneficiaries from unscrupulous and unlicensed marketers peddling false promises and scare tactics. Bad actors should have no place in today’s Medicare Advantage market.
However, CMS has issued unprecedented numbers of new rules that fall heavily on the shoulders of legitimate, private health insurance marketplaces and state-licensed Medicare agents and brokers. Little consideration is given to their objections, and insufficient time is allowed to study the impact of one year’s rules before the next year’s come into effect. Especially concerning are rules proposed for 2025 that would artificially restrict the compensation insurers can pay to agents who help them enroll beneficiaries in Medicare Advantage plans.
Agents are working hard to keep up with new regulations, but the high cost of compliance may force many to step back from the Medicare Advantage market, an outcome we believe would run counter to the interests of the Medicare beneficiaries CMS is seeking to defend.
Navigating their coverage choices is a challenge for most Medicare beneficiaries. State-licensed agents and brokers offering multiple Medicare plans from competing insurers are especially well positioned to help beneficiaries find the right plan for their needs and budget. Many seniors rely on the personal help and expert advice that only licensed agents and brokers can offer.
As demonstrated in a recent survey of more than 2,100 Medicare Advantage enrollees, those who speak with a licensed agent when selecting a plan are more likely to express high levels of satisfaction and confidence in the plan they finally choose. Almost 9 in 10, 85%, say they likely could not have found the right plan for their needs without the personal help they received from an agent.
If Medicare beneficiaries value the role of state-licensed agents so highly, why would CMS risk driving them out of the market and leaving beneficiaries to fend for themselves?
It is perhaps no coincidence that a flurry of policy changes in the Medicare Advantage market arrived just when the program grew to become the single most popular form of Medicare coverage nationwide. As reported by the KFF, Medicare Advantage plans now cover more than half, 51%, of all Medicare beneficiaries, up from 29% 10 years ago.
American seniors love Medicare Advantage, and for good reason. Medicare Advantage plans are affordable for those on a fixed income, they cover enrollees’ Parts A and B Medicare benefits while filling many coverage gaps, and most include prescription drug coverage. Some even offer additional benefits such as gym membership discounts and assistance with the cost of food.
Medicare Advantage has been the epicenter of innovation in Medicare for more than a decade. Medicare Advantage plans have proven beyond a reasonable doubt that private insurers can supply enrollees with government-mandated Medicare benefits efficiently and affordably.
Unfortunately, there are some in government and policy circles who object to Medicare Advantage on an ideological basis and would like to see it discredited. Given a free hand, they would abolish all private-sector involvement in the Medicare market, even at the risk of hampering innovation, increasing costs, and reducing the satisfaction of beneficiaries.
In hopes of forestalling such an outcome and championing the best interests of Medicare beneficiaries, we call upon public servants of goodwill in CMS and the Senate Finance Committee to make appropriate distinctions between unlicensed marketers and private health insurance marketplaces, state-licensed agents and brokers in good standing.
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To avoid unintended consequences, we encourage CMS to allow at least two years after the issuance of any significant new rules to test their impact on the sensitive Medicare market before commencing another round of rulemaking.
Finally, we encourage CMS to recognize and honor the high value tens of millions of Medicare beneficiaries place on Medicare Advantage and their licensed agents and to work cooperatively with insurers and legitimate industry representatives to make a successful public-private partnership even better.
Steve Beshear served as governor of Kentucky from 2007 to 2015. Bobby Jindal served as governor of Louisiana from 2008 to 2016 and as assistant secretary of Health and Human Services from 2001 to 2003. Both are members of the Public Policy Advisory Committee of eHealth.
