State insurance regulators in New Hampshire and North Dakota have issued bulletins warning health insurers against altering producer compensation and restricting enrollment access to Medicare Advantage and supplemental plans.
The New Hampshire Insurance Department said removing enrollment applications and discouraging producers from marketing certain products violates state law. The regulator also stated that reducing or eliminating producer compensation midyear is considered an unfair trade practice unless expressly permitted in approved compensation schedules.
“The conduct described in this bulletin is deeply troubling because it may restrict seniors’ access to the full range of Medicare options that the law allows,” insurance commissioner D.J. Bettencourt said in a release. “When Medicare-eligible Granite Staters are shopping for coverage, they deserve clear information, fair competition, and the confidence that neither carriers nor producers are steering them based on hidden incentives or midyear changes in compensation.”
The New Hampshire regulator said such actions harm consumers’ ability to make fully informed decisions and interfere with producers’ duties to act in their clients’ best interests. Regarding Medicare supplement plans, state law sets compensation limits, and commissions must remain consistent after the first year and cannot be modified during the policy term.
The bulletin clarified that insurers are not required to continue selling products properly withdrawn from the market. However, insurers must make enrollment reasonably available for plans that remain approved and offered in New Hampshire through online and mail distribution channels as well as appointed producers.
North Dakota issued a similar bulletin stating that insurers offering Medicare Advantage, supplement, cost, and Part D plans cannot restrict access or unfairly manipulate compensation structures. The insurance department said it released the bulletin after hearing about health insurers taking such actions in other states.
“When insurers manipulate the marketplace or penalize producers for helping consumers make the best choice, it undermines both competition and trust,” North Dakota insurance commissioner Jon Godfread said in a statement, as reported by Best Wire.
The North Dakota regulator said these actions particularly affect rural areas because federal rules limit the number of insurers that can offer certain Medicare plans based on enrollment thresholds set by the Centers for Medicare and Medicaid Services.
The bulletins follow cease-and-desist orders issued by the Idaho Department of Insurance to three health insurers, BestWire reported. Idaho regulators said UnitedHealthcare-affiliated carriers and PacificSource Community Health Plans eliminated agent commissions for Medicare Advantage plans and curtailed access to applications due to concerns over anticipated enrollment volume.
What are your thoughts on the recent announcement? Share your insights in the comments below.
