The Idaho Department of Insurance has issued cease-and-desist orders to PacificSource Community Health Plans, UnitedHealthcare of the Rockies, and Care Improvement Plus South-Central Insurance Co., citing allegations that the companies intentionally restricted access to Medicare Advantage applications due to concerns about enrollment numbers.
According to the department, the investigation began in September after reports surfaced that the insurers were limiting both online and paper applications for Medicare Advantage plans.
Agents in Idaho reported restricted access to paper applications and indicated that carriers planned to stop paying commissions for these plans, even though commission costs were included in approved rates.
Company representatives told the regulator that ending commissions was not a cost-saving measure but was intended to discourage enrollment. The department’s order stated that agents were told directly by the insurers that they did not want to sell Medicare Advantage plans, regardless of marketing efforts, because of concerns about the volume of new enrollees.
In October, UnitedHealthcare representatives informed the department that the companies were deliberately discouraging enrollment by "any means possible," according to the order.
Agents also reported that PacificSource required them to sign new zero-commission contracts by November 1, with the risk of losing contracts, commissions, and the ability to sell other PacificSource products if they did not comply.
PacificSource reiterated its preference for paper applications in two producer bulletins issued in October, which also stated that commissions were being removed from certain Idaho regions due to "market disruptions," according to the order.
With Medicare open enrollment ending December 7, the department said immediate action was necessary. The orders require the insurers to stop all practices that limit or conceal access to Medicare Advantage plans and applications, whether paper or online, and to end efforts to disincentivize agents from selling these plans.
PacificSource was specifically ordered to stop altering agent contracts to withhold commissions for the purpose of "manipulating the market," according to the regulator.
UnitedHealthcare stated that its decision to end commissions for certain Medicare Advantage plans applies only to new member enrollment and does not affect current members.
"This change is intended to help preserve the benefits that matter most to current members, while supporting the long-term sustainability of these plans in a landscape of increasing regulatory and market pressure," a UnitedHealthcare spokesperson said.
The regulatory scrutiny in Idaho comes as the Medicare Advantage sector faces broader challenges nationwide. Humana recently lost a federal court case contesting the government’s downgrade of its Medicare Advantage star ratings, a decision that could cost the insurer billions in bonus payments.
The ruling, which upheld the Centers for Medicare and Medicaid Services’ evaluation process, highlights the financial impact that quality ratings have on federal funding for private Medicare plans.
The Medicare Advantage market is also experiencing contraction in other states. In Vermont and New Hampshire, major carriers are reducing or discontinuing Medicare Advantage plan offerings for the 2026 plan year, impacting thousands of residents. State regulators have pointed to shrinking federal payments and tighter regulatory requirements as key reasons for these withdrawals.
Last month, UnitedHealthcare announced it would fully exit Medicare Advantage plans in 16 markets, primarily affecting preferred provider organization plans. The move is part of a broader strategy to reduce Medicare Advantage membership by 600,000.
