California Medicare Coalition

1. California Medicare Coalition Medicare and Part D: Who Regulates What? Federal and State Responsibilities The California Medicare Coalition is supported by funding provided by the California HealthCare Foundation, based in Oakland, CA

2. Our Focus California Health Advocates is dedicated to Medicare beneficiary advocacy and education for Californians. • Policy – Public policy research and recommendations for improved rights and protections, partner with national Medicare organizations based in Washington D.C. • Training – Professionals and informal helpers, vibrant web resources, newsletter and regional forums • Advocacy – Bring the experience of Medicare beneficiaries to the public through media and educational campaigns with the legislative staff at federal and state levels. www.cahealthadvocates.org California Health Advocates (c) 2006

3. Types of Medicare Plans • Part D – stand alone prescription drug plans (PDPs) • Provide prescription drug benefit only • Medicare Advantage (MA) plans • Offer all services covered under Medicare Parts A and B • Some may include Part D coverage (called MA-PDs) California Health Advocates (c) 2006

4. Medicare Advantage Plans • 3 Types of MA plans: • Coordinated Care Plans • Health Maintenance Organizations (HMOs) • Preferred Provider Organizations (PPOs) • Special Needs Plans (SNPs) • Private Fee-for-Service (PFFS) Plans • Medicare Medical Savings Accounts (MSAs) California Health Advocates (c) 2006

5. Medicare Advantage and Other Part D Coverage • Individuals enrolled in an MA coordinated care plan (HMO, PPO, SNP) cannotalso be enrolled in a PDP • Even if MA plan does not provide Part D coverage • If PFFS plan does not offer Part D coverage, enrollees can enroll in a PDP • MSAs cannot offer Part D coverage • So enrollees can also enroll in a PDP • Some retiree plans include Part D benefits and retirees cannot have other Part D coverage California Health Advocates (c) 2006

6. Marketing of Medicare Plans • Enormous increase in numbers and types of plans being offered • Many Part D sponsors offer multiple products (HMO, PPO, PDP, PFFS, SPNP, Medigap) • Many agents sell multiple products for the same or different sponsors • Informed decision making has become more difficult for Medicare beneficiaries • Lock-in rules mean limited opportunities to change plans if mistakes are made California Health Advocates (c) 2006

7. Marketing … • Multiple plan designs and variations are not always understood by agents and beneficiaries • Some MA rules, benefit designs not adequately explained • PPO deductibles • Not all providers will accept PFFS plans • Plans can pay higher commissions to agents for certain products • Agent are paid more for PFFS plans than a PDP • Some plan sponsors convinced current PDP enrollees to switch to their MA products California Health Advocates (c) 2006

8. Federal Law Preempts States • All Medicare Advantage plans and free standing Part D plans are regulated by federal law • State law preempted, except • State license required by federal law • Unless waived by CMS • Plan solvency as part of state license • Or meet federal rule if state license is waived • States cannot impose their own laws on Medicare plans • Language access, unfair claims practices, provider relationships, etc. • All complaints must go through federal system • CMS complaint tracking through 1-800-Medicare • Fraud and abuse contractor, West MEDIC California Health Advocates (c) 2006

9. Federal Law Applies • To all plan operations • All relationships with providers • All benefits and services • All grievances and appeals • All marketing of MA and Part D plans • Plan marketing materials • Plan marketing events • Plan marketing activities • All enrollment activities California Health Advocates (c) 2006

10. State Law Applies • To licensed agents selling Part D plans • Marketing activities, but • Not marketing materials approved by CMS • Agents name on marketing materials • Must include those things required under CA state law such as business names and other information • Can’t be misleading • Sales activities • New sales and replacements • Must be appropriate to needs of consumer • Cannot be misleading • Cannot misrepresent product • Cannot be coercive California Health Advocates (c) 2006

11. Marketing Activities: Federal Law • Agents/brokers can not: • Do unsolicited door-to-door marketing • Say they are from Medicare or HICAP • Offer money to join a plan • Enroll someone in a plan without their permission • Misrepresent a product someone is buying • Use scare tactics California Health Advocates (c) 2006

12. CA Statues Applying to Agents • §785 requires a duty of honesty, good faith, and fair dealing in the sale of insurance (65 and older) • §786.5 requires a full and accurate written comparison with other coverage (65 and older) • Requires explanation of relationship of proposed coverage with existing Medicare and Medi-Cal coverage California Health Advocates (c) 2006

13. Statues……. • §780 prohibits misrepresentations • §781 prohibits twisting and high-pressure sales tactics • Twisting is convincing someone to drop one policy in favor or another • §332 requires all parties to the contract to communicate all facts material to the contract which the other has no way to ascertain • May impose a duty to divulge • Current providers may not accept the plan being sold • Drugs a consumer is taking may not be covered California Health Advocates (c) 2006

14. HICAP Can Help! • The Health Insurance Counseling and Advocacy Program (HICAP) • 1-800-434-0222 for local appointments • State funded, statewide program • Free, individualized assistance with: • Medicare and Medicare Advantage • Part D choices and complaints • Supplementing Medicare • Long Term Care Insurance • Claim problems California Health Advocates (c) 2006

15. Contact Information • California Health Advocates ■ Websites: www.cahealthadvocates(Professionals) www.calmedicare.org(Consumers/General Public) • Health Insurance Counseling & Advocacy Program (HICAP) • 1 (800) 434 - 0222 California Health Advocates (c) 2006