Betsy Seals

2018 Medicare Marketing Guidelines – The Final word on Agency Compensation

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If there is one thing we can always count on, it’s that the Centers for Medicare & Medicaid Services (CMS) will keep us on our toes!

Not only did CMS wait until a record-breaking July 20 to release the 2018 Medicare Marketing Guidelines (MMG), but they also did an about-face when it came to the final agent compensation language in Section 120.4.4.

As noted in my previous blog, “Agent Compensation Changes in the Draft 2018 Medicare Marketing Guidelines,” CMS had proposed a huge change in the Draft 2018 MMG that would have potentially required a large-scale revision in how Third-Party Marketing Organizations (TMOs) are paid, fundamentally changing the way the industry currently does business. However, in the Final 2018 MMG released on July 20, 2017, we saw CMS completely change the proposed guidance by adding language that specifically permits Medicare Advantage Organizations (MAOs) to pay TMOs for “additional services” on a per-enrollment basis. The specific note added to Section 120.4.4 of the Final 2018 MMG is as follows: “Note: Plans/Part D Sponsors can tie the third-party (e.g., [Field Marketing Organizations] FMOs) administrative fees per enrollment as a way to attribute the [fair market value] (FMV) costs of services to a particular Plan/Part D Sponsor.” Please note, we should not take this as a sign CMS is backing off of their mission to ensure agent payments are compliant. Should CMS discover MAOs and TMOs are attempting to skirt the compensation guidance again in the future, we can expect to find CMS reverting to a stricter policy for TMO payments for “other services.”

For now, we can breathe a collective sigh of relief as the language in the final guidance related to payments to TMOs for “other services” should not have a huge impact on the way your business is currently run – which is a good thing considering we have just a few short months until the annual enrollment period.

If you have questions or need clarification regarding any of the information above, please contact me directly at bseals@gormanhealthgroup.com.

 

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Betsy Seals

About Betsy Seals

Betsy Seals is Senior Vice President of Consulting Operations at Gorman Health Group. She is an experienced Medicare managed care compliance professional who brings Gorman Health Group clients more than a decade of operational experience and compliance expertise.

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