Medicare lets some private fee-for-service plans resume marketing

The insurance companies had agreed voluntarily to stop promoting the plans until they met new CMS guidelines.

By David Glendinning, AMNews staff. Sept. 24, 2007.

Washington -- Three out of the seven major insurers offering a controversial type of Medicare private health plan received the green light from federal officials to start marketing their products again -- more than a month ahead of schedule.

Coventry Health Care Inc., Universal American Financial Corp. and WellCare Health Plans Inc. received approvals in August from the Centers for Medicare & Medicaid Services. The go-aheads came well in advance of a self-imposed Oct. 1 deadline to address alleged marketing abuses. The three insurance firms were part of the group of seven that in June voluntarily agreed to stop promoting their Medicare private fee-for-service plans after complaints of abusive and potentially illegal behavior by their agents.

Medicare beneficiaries had complained that agents signed them up for private fee-for-service products against their will or without telling them that their physicians might not accept the coverage. The companies agreed to work during the marketing moratorium to meet several CMS requirements, including the addition of disclaimer language on marketing materials, follow-up verification calls to beneficiaries and outreach programs to educate physicians.

The three insurers said they were eager to get back to letting seniors know about what the companies view as attractive plan options. The other four insurers that agreed to the marketing break are BlueCross BlueShield of Tennessee, Humana, Sterling Life Insurance Co. and UnitedHealth Group. Together, the seven companies handle about 90% of Medicare fee-for-service enrollment.