Insurers Use Aggressive Tactics To Push Enrollment in Higher-Cost Medicare Advantage Plans, Officials, Consumer Advocates Say
Some health insurers "have used improper hard-sell tactics" to enroll Medicare beneficiaries in private fee-for-service plans, the "fastest-growing type" of Medicare Advantage plan, according to a number of state and federal officials and consumer advocates, the New York Times reports. Private fee-for-service plans, which allow patients to visit any physicians or hospitals that will provide treatment on terms established by health insurers, in some cases can reduce access to care and increase costs for Medicare beneficiaries, according to the Times.
Last month, two WellCare sales agents were arrested in Georgia for alleged conspiracy to defraud Medicare beneficiaries. Georgia Insurance Commissioner John Oxendine said, "The agents signed up unwilling consumers and even deceased individuals for private Medicare plans," adding, "This appears to be a national problem, based on my conversations with insurance officials around the country." David Lipschutz, an attorney for California Health Advocates, said that WellCare sales agents also made unscheduled visits to a subsidized housing complex in California and enrolled Chinese-American residents with limited ability to speak English in private fee-for-service plans.
According to WellCare spokesperson John Aberg, the company has terminated contracts for 10 independent sales agents who engaged in prohibited marketing practices. Acting CMS Administrator Leslie Norwalk said that agency officials visited the WellCare corporate headquarters to express "strong concerns" about company marketing practices. "WellCare was informed that its efforts thus far to address marketing issues were inadequate and unacceptable," Norwalk said.
Richard Foster, chief actuary for Medicare, said "the additional payments to Medicare Advantage plans, above and beyond the costs" of traditional Medicare, are leading to higher premiums for all beneficiaries and are depleting the Hospital Insurance Trust Fund for Medicare.
Additional Investigations
Meanwhile, state insurance commissioners in Kansas, North Carolina, Oklahoma and Wisconsin have begun investigations into complaints that sales agents for health insurers switched Medicare beneficiaries into private fee-for-service plans without their consent. Mississippi Insurance Commissioner George Dale said, "Abusive Medicare insurance sales practices are spreading rapidly throughout the state." Louisiana Insurance Commissioner James Donelon said that some sales agents for health insurers have used "overly aggressive sales tactics" with "little or no concern for the needs of the consumer."
Michael Hagen, CEO of Riverwood Healthcare Center in Aitkin, Minn., said, "Patients buying these private fee-for-service plans are not sure exactly what they have bought," adding, "They go to a meeting sponsored by an insurance company. They hear a salesman. Sometimes the salesmen do not understand the nuances of the products they are selling" (Pear, New York Times, 5/7).
