CMS Enacts Sweeping, Impactful Policy with 2025 MA Final Rule – Brokers Beware

The Biden administration brought down the hammer on Medicare Advantage insurers and their brokers when the Centers for Medicare and Medicaid Services (CMS) released the 2025 Medicare Advantage Part D final rule last Thursday.

The rule increases regulatory scrutiny on prior authorization, network adequacy standards and marketing for Medicare Advantage. Modern Healthcare reports that CMS presented the new policies as a way to improve MA and protect consumers while promoting the Biden administration’s health equity goals.

In a U.S. Department of Health and Human Services (HHS) press release on the final rule, Secretary Xavier Becerra boasted that the rules would enhance the market and support healthy competition between plans:

We know that increased competition is good for the marketplace. That’s why the Biden-Harris Administration continues to increase competition in health care and lower costs, helping build on steps the Administration has already taken as well as identify opportunities to further spur innovation.

The rule sets compensation for agents and brokers in order to prevent them from steering beneficiaries to plans that may not suit their personal health needs. But the compensation rate was set higher than CMS had initially proposed, at $100. The rule also includes a new behavioral health provider type, a new plan to give notice to beneficiaries about supplemental benefits, new benefits for the chronically ill and quality improvement organizations, Inside Health Policy reports.

National Law Review notes that the rule codifies a prohibition on third party marketing organizations collecting beneficiaries’ personal data without explicit consent by the enrollee. The agency claims that it’s simply facilitating compliance for TPMOs with Federal Communications Commission (FCC) orders that clarify “express written consent.”

Many of the provisions were included in a proposed rule that was shelved by CMS in February, but the new rule carries a great deal of gravity for insurers. Fierce Healthcare reports that experts and executives are warning that the rules will have profound consequences for the industry. From Melissa Newton Smith, senior advisor for Oliver Wyman:

It is difficult to put words to the extent and impact of changes codified today. Every MA leadership team needs to be thoughtfully redesigning your stars and quality approach in order to earn quality bonus payments in 2025.