You’ve probably seen TV ads featuring D-list celebrities pitching Medicare Advantage plans by claiming that seniors may be missing out on valuable benefits. But Medicare beneficiaries are also being inundated with other aggressive — and often deceptive — Medicare Advantage marketing tactics, according to a report released Thursday by Senate Finance Committee Democrats.
Among the examples in the report:
• Seniors shopping at their local grocery store are approached by insurance agents and asked to switch their Medicare coverage or MA plan.
• Seniors who were told that by insurance agents that their doctors are covered by a new plan find out later that their doctor is not in network and they must pay out-of-pocket for a visit.
• Seniors receive marketing mailers designed to misleadingly look like official communication from a federal agency such as the Internal Revenue Service, Social Security Administration or Medicare.
• Seniors get flooded with 20 calls a day from an insurance agent trying to convince them to switch their Medicare coverage.
The report, based on information from 14 states, found that such marketing practices are “widespread, not isolated events.” It said that five states had shared examples of insurance brokers targeting beneficiaries with cognitive impairment and six states provided examples of people being signed up for Medicare Advantage plans without knowing it. It also noted that the number of beneficiary complaints about Medicare Advantage marketing received by the Centers for Medicare & Medicaid Services (CMS) more than doubled from 2020 to 2021.
“It is unacceptable for this magnitude of fraudsters and scam artists to be running amok in Medicare and I will be working closely with CMS to ensure this dramatic increase in marketing complaints is addressed,” Sen. Ron Wyden (D-OR), chair of the Finance Committee, said in a statement. “Medicare Advantage offers valuable plan options and extra benefits to many seniors but it is critical to stop any tactics or actors that harm seniors or undermine their confidence in the program.”
Why it matters: Under Medicare Advantage, sometimes called Medicare Part C, the government pays private insurers to cover health benefits for seniors. Such plans have grown in popularity and will soon cover more than half of Medicare enrollees. They’re also extremely lucrative for insurers — but as The New York Times reported recently, most large insurers in the program have been accused of fraud.
“Because it’s such a profitable line of business, they have an incentive to do more marketing,” Tricia Neuman, a senior vice president at the Kaiser Family Foundation, told The New York Times. “And they have more money to do marketing, which increases revenue.”
What can be done: This year’s open enrollment for 2023 Medicare plans is ongoing and will last until December 7. Seniors are advised to be on the lookout for potential scams and exercise caution if calling a number advertised on television or clicking on a sign-up link. The report says seniors can also call 1-800-MEDICARE for help if they think they’ve been enrolled in a plan that’s not right for them.
Beyond that, the Senate report includes a number of recommendations that it says would cut down on future use of such troublesome marketing tactics, including strengthening requirements that were loosened under the Trump administration, monitoring disenrollment patterns and then holding bad actors accountable, implementing stronger rules for Medicare marketing, and promoting legitimate sources of information.
“Medicare has told plans it will begin policing marketing materials more closely,” the Times reports. “Starting next open enrollment, Medicare will review and approve television advertisements before they air to make sure celebrities accurately describe the plans’ benefits.”