Is the New 2025 CMS Rule for Agent compensation actually GREAT news for AGENTS and FMOs?

[FMOadvisor]

The new rules dropped yesterday and I am copying the most interesting paragraphs below. Here is my admittedly optimistic reading of this rule.
1. Agents will get a $100 increase in both MAPD and PDP commissions and CMS is anticipating adding an additional 2.5% on top of that. Commissions will be raised to $726 for MAPD for most states, and PDP's will have a massive increase to $200.
2. The new rule specifically states:
This proposal, and all agent broker compensation rules at §422.2274(d) are
limited to independent agents and brokers, and do not extend to TMPOs more generally.

I am curious, is anyone as optimistic as me about the new rules? We do not get volume based enrollment bonuses from our NMA or the carriers and I have many levels under my FMO (SGA's, MGA's, GA's) I don't think this rule applies to overrides paid to them. I believe the rule is targeting HRA fee's and other administrative fee's such as some carriers paying you to get a clients email address, or paying a bonus if you select a PCP on an app. It also seems to be targeting "per app marketing money" that some carriers are paying outside of the override structure. I hope this is true. Read it and let me know what you think:


We believe that increasing the FMV rate for new enrollments by a total of $100, and

therefore applied to renewals at a maximum amount of 50 percent of the total compensation

amount, should provide agents and brokers with sufficient funds to continue to access necessary

administrative tools and trainings, to offset appointment fees and encourage the representation of

multiple plans, and therefore to continue providing adequate service to Medicare beneficiaries.

Accordingly, based on the information provided in comments and for the reasons discussed in

this final rule, we are finalizing a policy to make a one-time $100 increase to the FMV

compensation rate for agents and brokers for initial enrollments into MA plans for the 2025 plan

contract year.

TABLE FC-1: AGENT BROKER COMPENSATION UPDATES CY 2024–2026

2024 2025 2026

Initial Enrollment $611 (FMV TBD) + $100 FMV TBD

Renewal $305 (FMV TBD +100)*0.5 FMV TBD*0.5

By way of example, if we were to assume that the FMV increase in years 2025 and 2026 is 2.5

percent, the payment rates for those years would be as follows:

TABLE FC-2: EXAMPLE AGENT BROKER COMPENSATION UPDATES

CY 2024-2026

2024 2025 2026

Initial Enrollment $611 $726 $744

Renewal $305 $313 $372


Comment: Several comments expressed confusion about whether this payment is an "all in cap" that is intended to include all fees paid by an MA organization to an agent, broker, or

other TPMO, and what that would mean for payments related to marketing activities.

Response: This proposal, and all agent broker compensation rules at §422.2274(d) are

limited to independent agents and brokers, and do not extend to TMPOs more generally.

Therefore, this policy represents a limitation on payments in excess of those paid under

"compensation" only for commissions paid for enrollments to independent agents and brokers.

Though we are continuing to consider future rulemaking in this space, our current policy does

not extend to placing limitations on payments from an MAO to a TPMO who is not an

independent agent or broker for activities that are not undertaken as part of an enrollment by an

independent agent or broker.

 

[DonP]

The new rules dropped yesterday and I am copying the most interesting paragraphs below. Here is my admittedly optimistic reading of this rule.
1. Agents will get a $100 increase in both MAPD and PDP commissions and CMS is anticipating adding an additional 2.5% on top of that. Commissions will be raised to $726 for MAPD for most states, and PDP's will have a massive increase to $200.
2. The new rule specifically states:
This proposal, and all agent broker compensation rules at §422.2274(d) are
limited to independent agents and brokers, and do not extend to TMPOs more generally.

I am curious, is anyone as optimistic as me about the new rules? We do not get volume based enrollment bonuses from our NMA or the carriers and I have many levels under my FMO (SGA's, MGA's, GA's) I don't think this rule applies to overrides paid to them. I believe the rule is targeting HRA fee's and other administrative fee's such as some carriers paying you to get a clients email address, or paying a bonus if you select a PCP on an app. It also seems to be targeting "per app marketing money" that some carriers are paying outside of the override structure. I hope this is true. Read it and let me know what you think:


We believe that increasing the FMV rate for new enrollments by a total of $100, and

therefore applied to renewals at a maximum amount of 50 percent of the total compensation

amount, should provide agents and brokers with sufficient funds to continue to access necessary

administrative tools and trainings, to offset appointment fees and encourage the representation of

multiple plans, and therefore to continue providing adequate service to Medicare beneficiaries.

Accordingly, based on the information provided in comments and for the reasons discussed in

this final rule, we are finalizing a policy to make a one-time $100 increase to the FMV

compensation rate for agents and brokers for initial enrollments into MA plans for the 2025 plan

contract year.

TABLE FC-1: AGENT BROKER COMPENSATION UPDATES CY 2024–2026

2024 2025 2026

Initial Enrollment $611 (FMV TBD) + $100 FMV TBD

Renewal $305 (FMV TBD +100)*0.5 FMV TBD*0.5

By way of example, if we were to assume that the FMV increase in years 2025 and 2026 is 2.5

percent, the payment rates for those years would be as follows:

TABLE FC-2: EXAMPLE AGENT BROKER COMPENSATION UPDATES

CY 2024-2026

2024 2025 2026

Initial Enrollment $611 $726 $744

Renewal $305 $313 $372


Comment: Several comments expressed confusion about whether this payment is an "all in cap" that is intended to include all fees paid by an MA organization to an agent, broker, or

other TPMO, and what that would mean for payments related to marketing activities.

Response: This proposal, and all agent broker compensation rules at §422.2274(d) are

limited to independent agents and brokers, and do not extend to TMPOs more generally.

Therefore, this policy represents a limitation on payments in excess of those paid under

"compensation" only for commissions paid for enrollments to independent agents and brokers.

Though we are continuing to consider future rulemaking in this space, our current policy does

not extend to placing limitations on payments from an MAO to a TPMO who is not an

independent agent or broker for activities that are not undertaken as part of an enrollment by an

independent agent or broker.

Ask yourself a question . Do you really believe cms would have gone to all this trouble to give $100 raise to agents and take away there marketing money and leave the fmo unscathed ? Lol . The fmo could give 2 damms about marketing money as most of that was paid by carriers . There could be some money structured for the top line fmo's for tasks such as licensing, training , software etc . But the Ga, mga , sga will 100% not get overrides on agents . Cms specifically has mentioned the $1300 total comp for a mapd enrollment. They want to stem the flow of money . No matter how anyone chops this up much less total comp is out there for fmo's

 

[CaptainPlanet]

"Additionally, the final rule generally prohibits contract terms between Medicare Advantage organizations/Part D sponsors and middleman Third Party Marketing Organizations (TPMOs), such as field marketing organizations, which may directly or indirectly create an incentive to inhibit an agent or broker's ability to objectively assess and recommend the plan that is best suited to a potential enrollee's needs."

The way I interpreted this, FMO's as we know them today, are done for.

 

[newbie2001]

Can someone put this in plain speak and not government double speak please. All the people want to know is, is marketing money gone? Are overrides gone?

 

[FMOadvisor]

Well, even the lawyers are confused by the language because of all the contradicts in the rule right now. It seems to me that CMS is using the words "overrides" and "administration fees" interchangeably when they actually mean very different things to those of us in the Medicare Broker World. My NMA worked hard to lobby for changes in this legislation and even they can't give a definitive answer as to what the outcome will be this morning. Trying to stay optimistic and I will post any clarification's that I receive. Keep in mind that the rule is 1300+ pages long. It's going to take awhile to understand it all.

 

[newbie2001]

Well, even the lawyers are confused by the language because of all the contradicts in the rule right now. It seems to me that CMS is using the words "overrides" and "administration fees" interchangeably when they actually mean very different things to those of us in the Medicare Broker World. My NMA worked hard to lobby for changes in this legislation and even they can't give a definitive answer as to what the outcome will be this morning. Trying to stay optimistic and I will post any clarification's that I receive. Keep in mind that the rule is 1300+ pages long. It's going to take awhile to understand it all.

That is ridiculous. Wow.

 

[UKTX]

Am I right in thinking that the quarterly DSNP/LIS SEP will now be gone, thereby limiting call centers ability to switch DSNPS on demand? If true that's a big blow to the call centers?

 

[DonP]

Am I right in thinking that the quarterly DSNP/LIS SEP will now be gone, thereby limiting call centers ability to switch DSNPS on demand? If true that's a big blow to the call centers?

Yes lis/ partial Medicaid will have same seps as regular people . Oep/ aep etc . How I also read is unless a dsnp enrolls in a " integrated " dsnp which they can do monthly they also have the regular seps . But a fair warning what's taking place . Cms wants all dsnps to eventually be " integrated " . This means the dsnp will have Medicaid / mapd with same carrier for total integration. It's happening in Indiana next yr . What this means if you run into an Anthem dsnp they will have anthem Medicaid and mapd . It means unless you live there Medicaid first ti let's say United you can't move there dsnp . It affectively ends writing dsnps . But if you have a big dsnp book it's good as retention will be much higher . Also a person who has Medicaid and gets Medicare will be auto enrolled in a " integrated " plan . So no more running into that given nugget were somebody just has Medicare /medicaid . Games getting tougher

 

[FMOadvisor]

Ask yourself a question . Do you really believe cms would have gone to all this trouble to give $100 raise to agents and take away there marketing money and leave the fmo unscathed ? Lol . The fmo could give 2 damms about marketing money as most of that was paid by carriers . There could be some money structured for the top line fmo's for tasks such as licensing, training , software etc . But the Ga, mga , sga will 100% not get overrides on agents . Cms specifically has mentioned the $1300 total comp for a mapd enrollment. They want to stem the flow of money . No matter how anyone chops this up much less total comp is out there for fmo's

 

[FMOadvisor]

Hey Don,
Can you let me know where you see the cap of $1300? i couldn't find it in the rules document. As for the rest, I think the industry will collapse without "good" FMO's. Based on the language in the rule, I expect them to find some kind of work around to be able to compensate us for recruitment, training and the substantial continuous support that my team provides to both our direct agents and the teams that we helped them recruit for themselves. It may not be able to be based on a per app basis, but it very clearly says that the rules on compensation caps do not extend to TPMO's.