In response to the Centers for Medicare & Medicaid Services’ (CMS) 2025 Proposed Final Rule, the Sacramento Association of Health Underwriters (SAHU) is taking a proactive stance to represent the interests of its members and the broader health insurance community.

CMS has introduced a comprehensive proposed final rule, CMS-4205-P, set to bring about substantial changes to Medicare Advantage and Part D programs, effective from the 2025 contracting year starting September 30, 2024. Notably, the proposed rule addresses critical aspects of Medicare marketing and communications policies, particularly impacting agent and broker compensation outlined in Section 1851(j) of the Act.

Key elements of the proposed final rule encompass the elimination of administrative fees and overrides, restrictions on services provided to Medicare agents, impacts on different agency types, changes in marketing reimbursements and Health Risk Assessments (HRA) fees, modifications in commission structures, and operational adjustments for agents and agencies.

SAHU and its board members believe that CMS-4205-P may have certain drawbacks, particularly as this policy would essentially leave agents and brokers unable to directly recover administrative costs. These adjustments impacting FMO/Agency support, training, technology, and related aspects will influence beneficiary options by diminishing the number of agents not only promoting Medicare Advantage but also providing a diverse range of plans. In essence, this regulation is poised to yield outcomes contrary to its intended objectives.

“Field Marketing Organizations (FMOs) are General Agents who provide training, and a multitude of compliance expertise to field agents. Agents struggled to comply with the recent CMS recording requirements, but FMOs were able to quickly provide a scalable solution. Without the general support of FMOs, insurance carriers would need to provide these services, raising their administrative costs and premiums to beneficiaries.” Says, NABIP CEO Jessica Brooks-Woods.

With the CMS-4205-P proposal open for public comment until January 5th, SAHU urges its members and the broader community to unite in advocating for the best interests of our clients and the sustained strength of our profession. We encourage everyone to contribute professional and constructive feedback, and comments can be conveniently submitted through Regulations.gov.

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For over 30 years, SAHU has worked to improve our members’ ability to meet the health, financial and retirement security needs of all Californians and Americans through education, advocacy, and professional development. For more information, please visit: sahu-ca.com.