As of July 18 2024, CMS published an update on the Medicare Final Rule. The update states that all commission payments will stay as they were prior to the CMS Final Rule changes. Commissions payments for MA and PDP plans remain the same for the rest of 2024 and 2025 while the stay is in effect. This means, the addtional $50 and $100 payments to brokers and uplines is no longer an option. Uplines will continue to receive over ride payments as they do now.
At some point, in 2025, the will be a final decision on the CMS Final Rule. Once that happens, the commission payment structure is subject to change.
Click here to download commission chart for 2025
Due to the fact that; a lawsuit was filed against the validity of some provisions in the Medicare Final Rule. Many organizations feel that CMS and the Department of Health and Human Services does not have the authority to place restrictions on their income. The lawsuit also states parts of the rule are arbitrary and were put in place without following proper procedure.
A federal court in Texas put a stay on some provisions of the CMS contract rule 2025 Final Rule on July 3, 2024, to amend current broker compensation for Part D and Medicare Advantage plan sales. Medicare Advantage insurers and marketers now have to wait and see what the final outcome will be for their businesses.
Once the judge makes his decision, all parties involved will have an opportunity to appeal the decision. If this happens, there is no way to predict when we will know the final outcome.
The 2025 AEP and the carriers
There are only a few short months before the start of AEP on October 15th. Because of this, each carrier seems to be making an independent decision on how to proceed with their 2025 benefits. The decision how to pay agents/brokers until the court makes a final ruling also seems to depend on the carrier.
Many carriers have already decided to reduce benefits and plan service areas due to the increased financial burden CMS has placed on them. Some carriers may exit the market altogether and a few will expand into new markets.
What all this means for Agents
As of today, agents are feeling very uncertain as to what their future business looks like. No matter what the outcome, this AEP will be interesting with all the plan changes and the uncertainty of the PDP market
CMS designed specific policies to stop incentivizing the sale of one Medicare product over another. They aimed to pull back MA/MAPD marketing money that carrieres were providing agents. There is a some speculation that smaller companies do not have the same budget to work with as the large competitiors. This gives the bigger companies an unfair advantage.
Click here to learn more about the proposed compensation changes
Because carriers are responsible for the actions of anyone marketing their plans, all advertisements must pass CMS guidelines before they are approved for use.
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