House Panel Hearing Addresses Medicare Advantage Plan Sales Practices

The House Energy and Commerce Oversight and Investigations Subcommittee on Tuesday held a hearing on alleged improper and illegal sales practices used by private Medicare Advantage plans, CQ HealthBeat reports (Carey, CQ HealthBeat, 6/26). According to CMS, two-thirds of private Medicare Advantage plans have been cited for violating federal rules when enrolling or dealing with beneficiaries, the Tampa Tribune reports. CMS Center for Beneficiary Choices Director Abby Block at the hearing said the agency did not impose fines for any of the violations and instead asked the companies to write "corrective action plans" (Gentry, Tampa Tribune, 6/27).

Witnesses at the hearing discussed practices that "run the gamut, from signing up beneficiaries without their consent or knowledge to sales agents misrepresenting themselves as employees of Medicare -- and even of the White House," CQ HealthBeat reports. House Energy and Commerce Committee Chair John Dingell (D-Mich.) said, "Overpayments to the insurance industry serve as a perverse incentive for insurance companies and agents to aggressively market their products without regard to seniors' health and financial well-being" (Carey, CQ HealthBeat, 6/26). Subcommittee Chair Bart Stupak (D-Mich.) said, "My problem is, I never see CMS impose a penalty" on private Medicare plans that violate rules (Tampa Tribune, 6/27).

Oklahoma Insurance Commissioner Kim Holland said, "Our seniors are plagued by aggressive and frequently misleading advertising, agent high-pressure tactics and a lack of responsiveness, if not outright neglect, from their insurance company" (Casteel, Daily Oklahoman, 6/27). North Dakota Insurance Commissioner Jim Poolman said, "Even though CMS has long been aware of the conflicts and 'bugs' in their system, they have not been resolved -- they are worse" (Tampa Tribune, 6/27).

Some witnesses said that Congress and CMS should consider revisions to commission structures for sales agents, oversight and training of sales agents, and reimbursement rates for MA plans. Health insurers said that the alleged improper and illegal sales practices involved only individual sales agents, who the companies since have fired. In addition, health insurers discussed steps that they have taken to prevent such practices in the future. Block said that the agency also has taken steps to increase enforcement against such practices (CQ HealthBeat, 6/26).

Uncompensated Care
In other Medicare news, Sen. Chuck Grassley (R-Iowa), ranking member of the Senate Finance Committee, has asked for improved information on uncompensated care provided by hospitals that participate in the program, CQ HealthBeat reports. Last week, Grassley sent a letter to CMS that cited concerns about information from S-10 worksheets in the Medicare hospital cost report. He wrote, "We have heard concerns about the usefulness of this information because of unclear definitions and instructions, as well as inconsistent reporting."

CMS has considered revisions to the worksheets recommended last year by the Medicare Payment Advisory Commission. In the letter, Grassley asked for a timeline on when CMS plans to implement revisions to the worksheets and when the revised worksheets will begin to produce hospital cost report data. According to Grassley, "These improvements would not only ensure consistent reporting but would also result in data that can be used to guide important decisions in numerous policy areas" (Phillips, CQ HealthBeat, 6/25).