The first Advantage plans were introduced in 1997. 2006 is when PDP's hit the scene.
CMS Proposal to End Multilevel FMO Marketing
- Thread starter MedSuppPro
- Start date
The first Advantage plans were introduced in 1997. 2006 is when PDP's hit the scene.
Nope. They were around before, but not called Medicare Advantage and they weren't set up the same. Medicare + Choice isn't the same and Medicare Advantage.
I don't know if it will do any good, but if anyone wants to submit a complaint to CMS, see information below. CMS is basically saying that the FMOs will get less money. For those of us getting marketing dollars, reimbursed marketing expenses, and other support from agencies, this could hurt us financially because it increases our expenses. And don't forget about the software we use through our FMOs like Sunfire & MedicareCenter. I don't think the average agent can afford this software or would even have access to it to be able to purchase it.
Anyway, the info is below. I copied this from an email sent out by Ed Crowe:
How to submit a comment
A number of people have asked me if there is anything we can do to change the final version of the rule. The best thing we can do is to send in comments to CMS regarding the proposal. You can send in a comment by going to regulations.gov and making a comment. When you go to the site enter "CMS-4205-P" in the search bar. It will bring the entire 486 page document up. There is also a "Comment" button you can submit comments through. It will ask you to choose a category which can be "Government-Federal" Make sure to reference the proposal number in the comments which is CMS-4205-P
Pinnacle www.pfsinsurance.com has added a lot of information to their homepage worth reviewing. It includes links to contact U.S. Senators and local congressional district representatives.
Suggestions for submitting a comment
Remember: All comments are public record so be professional with all comments submitted.
It is my feeling that CMS does not know the difference between an independent agent/agency and a tele-sales organization or a direct carrier rep that only sells the company they work with. They feel we all operate in the same manner, which is to sell the client the company that pays us the highest amount (due to overrides or expense reimbursements) or the company with the highest paying HRA fee. They also do not understand that most independent agents talk to clients about Medicare advantage and supplements plans and find the best type of plan that works for them.
- Explain to them how you are different as an independent agent
- You work with the client to find the best type of plan Advantage vs. Medicare supplement. You check medications for PDP and Advantage plans and check doctors for Advantage.
- Also, unlike a tele-sales agent or company sales rep, you call them every year to make sure they are in the best plan possible for their situation.
- If you feel the services and value you provide to clients would be inhibited by losing the support of your upline (Contracting, support with questions, Connecture, Sunfire, compliance updates) it would be important to mention that in the proposal
You're closed. Shoot me an email, let me know what you can doCall me and let's see if there is anything left.
Larry Shoemaker
New Member
- 4
In the Federal Register, I saw reference to $12.50/hr as reasonable compensation for doing HRA's. Also, citations of the Commonwealth Fund regarding agent practices. I assume the same perspectives apply to federal employee compensation and working practices.
Buh bye
[EXTERNAL LINK] - NAHU Washington Update - 11/10/2023
CMS Releases Contract-Year 2025 Medicare Advantage Proposed Rule
CMS released the proposed Contract Year (CY) 2025 Policy and Technical Changes to the Medicare Advantage Plan Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, Programs of All-Inclusive Care for the Elderly and Health Information Technology Standards proposed rule on Monday. Included in the draft regulation are provisions related to broker compensation and "administrative fees," which were also discussed in last month's Senate Finance hearing.
In the proposed rule, CMS acknowledges that independent agents "have become an integral part of the industry, helping millions of Medicare beneficiaries to learn about and enroll in Medicare, MA plans and PDPs by providing expert guidance on plan options in their local area, while assisting with everything from comparing costs and coverage to applying for financial assistance." However, the proposed rule also operates under the assumption that MA agents are incentivized by large plans to steer beneficiaries to certain plans over others based on "excessive compensation" and other bonus arrangements rather than what is best for the beneficiary. According to CMS, the proposed regulations ensure that compensation is comprised of "only the legitimate activities required of agents and brokers."
Overall, if finalized as written, CMS would redefine agent and broker compensation by eliminating "administrative fees" and capping the maximum compensation for enrollment at $642.
More specifically, the draft regulation would amend the definition of "compensation" to include "all payments to agents or brokers that are tied to enrollment, related to an enrollment in an MA plan or product, or are for services conducted as part of the relationship associated with the enrollment into an MA plan or product" Also included under the "compensation" umbrella would be "all payments to an agent or broker relating to the initial enrollment, renewal or services related to a plan product."
CMS provides an example of agents being compensated for conducting health risk assessments, which CMS would classify as an administrative service. The administration notes that it has been made aware of instances where an agent enrolls a beneficiary into a plan and simultaneously asks the enrollee to complete a health risk assessment, then the agent is compensated at rates up to $125 per assessment. According to CMS, compensation for administrative services at these levels is "not consistent with market value." The administration also notes that payments for training, testing and other administrative services appear to substantially exceed the amounts paid for comparable tasks by other MA plans, as well as the compensation for similar work performed by insurance agents and brokers in different sectors.
In addition to altering the compensation structure, the proposed rule would generally prohibit contract terms between MA organizations and field marketing organizations (FMOs) – which CMS claims result in volume-based bonuses for enrollment into certain plans, "which may interfere with the ability of agents or brokers to assist the enrollee in finding the plan that is best suited to their needs."
CMS recognize that this leaves "agents and brokers unable to directly recoup administrative costs such as overhead or lead purchasing from its compensation from Medicare health and drug plans, unless the agent has a certain volume of business." The administration uses the example of a customer relationship management (CRM) system to log recorded calls with potential enrollees; however, CMS states that they "do not believe there to be a large risk of agents or brokers failing to cross that initial threshold to recoup their administrative costs."
Outside of the provisions specific to agent and broker activity, the proposed rule would streamline the appeals process for enrollees if their MA plan terminates coverage for certain post-acute-care services, standardize the appeals process for MA Risk-Adjustment Data Validation audit findings, limit out-of-network patient cost-sharing for certain plans serving dually eligible enrollees, and give Part D plans more flexibility to substitute biosimilars for reference-drug products.
As we have noted several times over the last two years, local agents have needlessly been grouped with unscrupulous third-party marketing organizations, or TPMOs. Lead-generation and marketing entities have traditionally been defined as TPMOs. The call centers they control have engaged in bad-faith practices for several years, airing television commercials that leverage a celebrity's popularity and credibility to attract the attention of Medicare beneficiaries, with the goal of enrolling the beneficiary in supplemental plans they may not need – purely for the pursuit of profit.
It is clear now that the federal government recognizes how vital local agents are to the Medicare market and for the benefit of seniors. However, it is also clear that education is still required on the role of the FMO in the market; in our comments to the Senate Finance Committee last month, NABIP explained that FMOs operate as variable cost sales offices working on a contracted basis with multiple carriers. The organizations provide a wide variety of services that empower agents and their clients, from handling contracting and credentialing processes to helping agents navigate the regulatory environment. It is a fundamental misunderstanding to believe that "administrative fees" related to FMOs go straight into the agent's pocket.
Ultimately, our primary message to lawmakers is: Without 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 the federal government seeks to protect them from.
NABIP is working with our Medicare Advisory Group, FMO Council and external stakeholders to submit comments to CMS and lawmakers, in addition to creating a fact sheet and infographic that highlights the differences between agents, TPMOs and FMOs, and all the nuance required to understand how the MA marketplace functions. If you are a Medicare agent who works with FMOs, please fill out this survey!
[EXTERNAL LINK] - NAHU Washington Update - 11/10/2023
CMS Releases Contract-Year 2025 Medicare Advantage Proposed Rule
CMS released the proposed Contract Year (CY) 2025 Policy and Technical Changes to the Medicare Advantage Plan Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, Programs of All-Inclusive Care for the Elderly and Health Information Technology Standards proposed rule on Monday. Included in the draft regulation are provisions related to broker compensation and "administrative fees," which were also discussed in last month's Senate Finance hearing.
In the proposed rule, CMS acknowledges that independent agents "have become an integral part of the industry, helping millions of Medicare beneficiaries to learn about and enroll in Medicare, MA plans and PDPs by providing expert guidance on plan options in their local area, while assisting with everything from comparing costs and coverage to applying for financial assistance." However, the proposed rule also operates under the assumption that MA agents are incentivized by large plans to steer beneficiaries to certain plans over others based on "excessive compensation" and other bonus arrangements rather than what is best for the beneficiary. According to CMS, the proposed regulations ensure that compensation is comprised of "only the legitimate activities required of agents and brokers."
Overall, if finalized as written, CMS would redefine agent and broker compensation by eliminating "administrative fees" and capping the maximum compensation for enrollment at $642.
More specifically, the draft regulation would amend the definition of "compensation" to include "all payments to agents or brokers that are tied to enrollment, related to an enrollment in an MA plan or product, or are for services conducted as part of the relationship associated with the enrollment into an MA plan or product" Also included under the "compensation" umbrella would be "all payments to an agent or broker relating to the initial enrollment, renewal or services related to a plan product."
CMS provides an example of agents being compensated for conducting health risk assessments, which CMS would classify as an administrative service. The administration notes that it has been made aware of instances where an agent enrolls a beneficiary into a plan and simultaneously asks the enrollee to complete a health risk assessment, then the agent is compensated at rates up to $125 per assessment. According to CMS, compensation for administrative services at these levels is "not consistent with market value." The administration also notes that payments for training, testing and other administrative services appear to substantially exceed the amounts paid for comparable tasks by other MA plans, as well as the compensation for similar work performed by insurance agents and brokers in different sectors.
In addition to altering the compensation structure, the proposed rule would generally prohibit contract terms between MA organizations and field marketing organizations (FMOs) – which CMS claims result in volume-based bonuses for enrollment into certain plans, "which may interfere with the ability of agents or brokers to assist the enrollee in finding the plan that is best suited to their needs."
CMS recognize that this leaves "agents and brokers unable to directly recoup administrative costs such as overhead or lead purchasing from its compensation from Medicare health and drug plans, unless the agent has a certain volume of business." The administration uses the example of a customer relationship management (CRM) system to log recorded calls with potential enrollees; however, CMS states that they "do not believe there to be a large risk of agents or brokers failing to cross that initial threshold to recoup their administrative costs."
Outside of the provisions specific to agent and broker activity, the proposed rule would streamline the appeals process for enrollees if their MA plan terminates coverage for certain post-acute-care services, standardize the appeals process for MA Risk-Adjustment Data Validation audit findings, limit out-of-network patient cost-sharing for certain plans serving dually eligible enrollees, and give Part D plans more flexibility to substitute biosimilars for reference-drug products.
As we have noted several times over the last two years, local agents have needlessly been grouped with unscrupulous third-party marketing organizations, or TPMOs. Lead-generation and marketing entities have traditionally been defined as TPMOs. The call centers they control have engaged in bad-faith practices for several years, airing television commercials that leverage a celebrity's popularity and credibility to attract the attention of Medicare beneficiaries, with the goal of enrolling the beneficiary in supplemental plans they may not need – purely for the pursuit of profit.
It is clear now that the federal government recognizes how vital local agents are to the Medicare market and for the benefit of seniors. However, it is also clear that education is still required on the role of the FMO in the market; in our comments to the Senate Finance Committee last month, NABIP explained that FMOs operate as variable cost sales offices working on a contracted basis with multiple carriers. The organizations provide a wide variety of services that empower agents and their clients, from handling contracting and credentialing processes to helping agents navigate the regulatory environment. It is a fundamental misunderstanding to believe that "administrative fees" related to FMOs go straight into the agent's pocket.
Ultimately, our primary message to lawmakers is: Without 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 the federal government seeks to protect them from.
NABIP is working with our Medicare Advisory Group, FMO Council and external stakeholders to submit comments to CMS and lawmakers, in addition to creating a fact sheet and infographic that highlights the differences between agents, TPMOs and FMOs, and all the nuance required to understand how the MA marketplace functions. If you are a Medicare agent who works with FMOs, please fill out this survey!
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After watching several YouTube videos on this subject, it is pretty clear that this would result in lost revenue. This is due to no more comp for HRAs, overrides,
Over the weekend, I had a chance to listen to the arguments against this new proposal. I have to say that I am convinced that Indy agents' incomes and resources would be diminished by $1000s.
1) No more $60-125 HRAs
2) No more overrides
3) No more use of the upline's Sunfire
4) No more educational courses
5) No more marketing money
6) No more AHIP/ Errors & Omission reimbursement
I happen to think that my FMO is the best that I've ever had- always there to answer questions and assist with professionalism and promptness. I want it to be around for a long time. I think that the difference is having a good partner and having one that basically steals the money. I wouldn't mind if CMS would AUDIT an FMO to verify that it is spending its money on marketing/staff instead of frivolous things. It would be no different than what CMS does for its other healthcare providers.
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According to the YouTube videos that I saw, it applies to ALL levels from GA up to FMO. I haven't had time to read the actual proposal yet.
"overrides " to Fmo's are given under " administrative fees" . Maximum comp for a true up is $601 . Any moneys above that are administrative fees . Those will not be allowed in 2025. Marketing money is administrative fees . Nothing above $642 will be allowed in 2025 . Do carriers chop agent comp and give that difference to Fmo's ?
