Clients Need Firm Medicare Marketing Rules: David Luna

If selling Medicare plans is a core part of agents’ practices, they may be too busy to read this article until sometime after Dec. 7, when the annual enrollment period for 2024 Medicare Advantage plan coverage and Medicare Part D prescription drug plans ends.

As clients, at or near retirement age, seek help with general financial and retirement planning, they are getting an enormous stream of Medicare plan marketing emails, text messages and telephone calls.

If they turn on the television, they see a Medicare plan ad. If they open a newspaper, they see a Medicare plan ad.

If they pet the cat, the cat probably meows something about new grocery discount features.

David Luna is someone who has dared to enter the stream.

Luna is a licensed Medicare plan agent and the president of Connie Health, a 4-year-old Brookline, Massachusetts-based startup that aims to use artificial intelligence technology to help connect consumers with experienced local Medicare plan agents who understand the hospitals and physician networks in the consumers’ own communities.

Luna spent 12 years as a police officer in Glendale, Arizona, then retired from the department and went to work as an insurance agent. He was senior manager for government programs at Blue Cross Blue Shield of Arizona in 2018, when he left to become the national director for broker sales at Iora, a Boston-based primary care delivery firm.

In 2019, he and other Iora veterans started Connie, which now has agents in Arizona, Florida, Illinois and Texas.

Luna recently answered questions, via email, about new Centers for Medicare and Medicaid Services marketing rules that have affected the sale of Medicare Advantage plans and Medicare Part D prescription drug plans. The interview has been edited.

THINKADVISOR: What do you think about all of the Medicare plan marketing rule changes?

DAVID LUNA: New marketing rules are released every year to protect Medicare beneficiaries, who are in a portion of the population that’s susceptible to scams and insurance fraud.

Many seniors are incredibly overwhelmed while selecting a Medicare plan, and that reinforces the value of the rules protecting seniors.

There are nearly 4,000 Medicare plans being offered this year. Medicare plans can differ greatly from state to state and based on an individual’s needs.

Our recent annual enrollment period survey showed that:

34% of seniors are uncomfortable about making big purchases due to the projected Medicare premium increases this year.
33% of seniors haven’t taken advantage of Medicare benefits this year because they’re concerned about added costs.
26% of seniors say they owe $500 to $1,000 in unpaid medical expenses.

The Centers for Medicare and Medicaid Services has announced two big sets of marketing rules. What changes apply now?

The CMS marketing rules from the 2023 annual enrollment period season still apply during the 2024 AEP.

One of the most notable changes to the Medicare AEP marketing rules happens to be a requirement for recording calls.

All sales activities need to be recorded and stored for a period of 10 years. If a customer does not wish to be recorded, agents must end the call, which could result in confusion on the consumer side.

Second, this year, CMS also requires the use of a third-party marketing organization, or TPMO, disclaimer.

Agents must read the TPMO disclaimer within the first minute of the call.

The disclaimer states that agents do not offer all the plans, and that the customer can contact Medicare to get a list of all their options. This disclaimer must be on all communication materials, such as emails, marketing materials, etc..

The third big change is the introduction of the scope of appointment form, or SOA form. This is a “permission slip” that says the customer has agreed to speak to the agent about certain products. It keeps the agent from discussing other, unrelated products that aren’t on the SOA.

The SOA was required in the past, and agents had to wait 48 hours to meet with a customer. This was done to avoid high-pressure sales.

In 2018, the SOA was still required, but it was no longer required for agents to obtain the SOA 48 hours before the appointment, when practicable.