Congress enacted the Affordable Care Act in 2010 under unusual circumstances. Democrats began drafting the law when they had 60 votes in the Senate and a majority in the House. Senator Edward Kennedy’s passing changed that. Democrats turned to the budget reconciliation process to pass the ACA. However, this circumvented the legislative process we learned about on School House Rock. The law never went to a conference committee. Conference committees fine tune legislation, addressing details, nits and errors. Without these tweaks, laws are usually flawed.
Which meant that the ACA had problems. Whatever your personal opinion on the ACA, the reality is the legislation as passed needed refinement. Normally this problem would be remedied in follow-up legislation. But the politics of the ACA made significant fixes impossible. Republicans historically wanted to repeal Obamacare, not fix it. Democrats couldn’t implement many fixes on their own.
This year, however, the IRS stepped up to fix what is known as the Family Glitch. To oversimplify a bit, these are rules that determined whether a person was eligible for a premium tax credit. Family members of employees offered qualifying employer-sponsored coverage who could not afford the dependent premium were ineligible for subsidies when they obtained insurance through an ACA exchange.
The regulations apply to health plans with January 1, 2023 effective dates – even if those plans are sold before January 1st. For example, plans sold during this year’s open enrollment (November 1, 2022 through January 15, 2023).
Which means if you sell health insurance, understanding the Family Glitch fix is important. Fortunately, the folks at NAHU can help with that. They’ve published a Family Glitch FAQ that is required reading for benefit specialists. (Members of NAHU have access to compliance support that can provide even more assistance). You can view NAHU’s FAQ here.
That brokers (and other “Third Party Marketing Organizations — TPMOSs) need to record their calls with Medicare Advantage and Part D clients and prospects is overly burdensome for many. While there’s a concerted effort led by NAHU and others to bring some reasonable accommodations to the requirements, for now they’re here to stay.
The Centers for Medicare & Medicaid Services (CMS) made that clear last week with a memorandum concerning best practices during the 2023 Annual Election Period.
CMS reviewed thousands of complaints, hundreds of audio calls, and done some secret shopping. They believe agents are “unduly pressuring beneficiaries” and failing to provide “accurate or enough information” to make sure consumers are making informed decisions. They promise to continue close monitoring during open enrollment this year and will take compliance action when they deem it appropriate.
Their memorandum implies their focus is on agencies advertising heavily, especially on television. We’ve all seen those commercials. Sometimes twice in one commercial break. Frankly, those kind of operations should be closely monitored. Does this mean more traditional agencies should feel safe from auditing? No. Even if CMS is after large fish that doesn’t mean their net won’t catch smaller ones as well. They no doubt will.
The CMS is calling on Medicare Advantage Organizations and Part D sponsors to police their sales organizations. The agency even lists best practices for this in their memorandum.
If you sell Medicare Advantage or Part D coverage, the lesson here is simple. Know the rules and abide by them. If an error occurs, address it. Until further notice, record your calls with both prospects and clients. Most VOIP systems can make the recording process straightforward (although still annoying). Agency management systems like NextAgency can help you organize and manage these recordings.
Make a good faith effort to comply. That’s not a “get out of jail free” card, but it can go a long way to getting you through this year’s AEP. Hopefully by next year there will be more accommodating rules and regulations.
Here’s the CMS memorandum.