Friday, June 15, 2007

Industry Trade Association Pledges to Halt Medicare Fee For Service Marketing Until Sales Abuses Are Cleaned Up--But Forgot to Mention One Thing

This from the June 15 AHP health insurance trade association news release:

"Taking a major step to give Medicare beneficiaries peace of mind, today seven of our member companies are making a pledge to voluntarily stop marketing non-group Medicare Advantage Private Fee For Service plans and to strengthen consumer protections by implementing now the Centers for Medicare and Medicaid Services (CMS) 2008 marketing enhancements ahead of schedule."

The industry says they expect to open things up again "well prior to the launch of 2008 marketing efforts."


With state insurance regulators and state attorneys general giving Congress lists of sales abuses from at least 39 states that include such things as the enrollment of dead or mentally impaired seniors, the impersonation of Medicare officials, and the use of personal information stolen from federal records, it's the responsible thing to do. It also wasn't lost on the industry when, in a Congressional hearing, the industry was told in no uncertain terms to deal with the bad guys and CMS showed little patience on the matter, to boot.

However, in making this bold and magnanimous move the trade association neglected to tell the reporters one little thing in their self-congratulatory news conference.

They weren't going to sell much new business this summer anyway.

You see, unless a senior is just turning age 65 (or uses the convoluted "limited open enrollment period" that requires splitting drug coverage out of the private Medicare plan), they can't sign up for a different Medicare plan, like Private Fee For Service, at any time other than the open enrollment period between November 15th and December 31st.

Nice PR though.

Reuters News Story With Analysis of Impact on New Sales: Medicare pause seen causing insurers little pain


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