State Regulators Defend Medicare Supplement Sellers Against Sen. Warren

What You Need to Know

Sen. Elizabeth Warren worries agents will steer clients toward bad Medicare supplement insurance products to win trips.
NAIC officers say the marketing problems they see are on the Medicare Advantage plan side.
The NAIC officers note that the federal government has jurisdiction over Medicare Advantage plan marketing.

State insurance regulators say Sen. Elizabeth Warren, D-Mass., should spend more time monitoring marketing concerns in the Medicare Advantage plan market and less time worrying about incentive travel for top Medicare supplement insurance agents.

The senator recently sent the National Association of Insurance Commissioners (NAIC) a report suggesting that offers of trips to places like San Diego, Hawaii and the U.S. Virgin Islands could lead agents to steer clients toward overly expensive or otherwise unsuitable Medicare supplement insurance policies, or to buy additional, potentially unsuitable supplemental insurance products.

Chlora Lindley-Myers, the NAIC’s president, and three other NAIC officers told Warren they see few complaints about the sales and marketing efforts for Medicare supplement insurance policies, which are regulated by the states, and many complaints about sales and marketing efforts for Medicare Advantage plans, which are regulated by the federal government’s Centers for Medicare and Medicaid Services.

“The NAIC continues to urge Congress to return [Medicare Advantage] marketing oversight authority to the states,” the NAIC officers said.

What It Means

Warren and state regulators have very different ideas about the people and organizations selling private Medicare coverage to your clients.

Private Medicare Plan Basics

Medicare supplement insurance policies are private insurance policies that fill in the many holes in “original Medicare” coverage for about 14 million of the 65 million Medicare enrollees.

Issuers of the policies, which are sometimes called “Medigap” or “MedSupp” policies, use a standardized plan framework developed in 1990.

Between 2017 and 2021, the share of original Medicare enrollees who bought Medigap coverage increased to 41%, from 35%, according to America’s Health Insurance Plans.

Medicare Advantage plan issuers provide what looks to enrollees like a comprehensive alternative to original Medicare coverage for about 30 million people.