Agent Tools Offer Information on 43% of Medicare Advantage Plans

Agents play a major role in guiding members during Medicare Advantage plan enrollment, but their methods may limit members’ ability to know all of their health plan options, a Commonwealth Fund study discovered.

Medicare enrollment is a source of much confusion for Medicare beneficiaries, with over 37 percent of seniors not knowing where to start their health plan search.

“Medicare beneficiaries have more plan choices than ever before, including private plans,” the researchers explained. “Beneficiaries think the selection process and plan options are complicated, with reported complexity increasing among people in poorer health and for those with lower levels of education. To help navigate their decision-making process, beneficiaries turn to a wide range of educational and informational resources, including licensed Medicare agents, or brokers.”

For this study, the researchers used data from CMS, expert interviews, online search simulations, and brokerage site exploration to assess the breadth of plan information members would find accessible.

After looking at three national, online agent plan selection tools, the researchers concluded that these tools can handicap Medicare beneficiaries’ ability to make an informed choice.

Since agents do not have to contract with every plan and since they are not incentivized to provide information on plans with which they have no contract, the tools only offered information regarding, on average, 43 percent of Medicare Advantage plans and 65 percent of Part D prescription drug plans.

Over nine in ten Medicare Advantage and Part D plans had contracts with independent agents in order to increase enrollment. These agents’ incomes are often tied to the contracted plan’s enrollment outcomes that year.

As a result, even though agencies may allow agents to direct consumers towards plans with which the agencies have no contract, there is no incentive to be so objective.

Medigap offerings may be even harder to find with brokers’ tools. In a regional study of what information these tools offered about five specific markets spread out across the US, the researchers found that only one tool provided Medigap options. Moreover, the tool only included 18 percent of the Medigap options in the regions studied.

Medigap plans’ health benefits are confusing enough for consumers to evaluate without the added complication of assessing the Medigap options that are actually available to them in their area.

The agent websites did not offer many plans with high rankings from the Medicare Advantage Star Ratings program, though the number of five-star plans is growing. In fact, in two of the five regions that the researchers targeted, the agents offered no information on the five-star Medicare Advantage plans that were available.

“This may be happening for a variety of factors unrelated to the quality of the plans, such as the incentive structure, the carrier’s investment in or commitment to partnering with agents, or the size of and reach of the carrier (for example, national vs. regional or local),” the researchers explained.

Through simulated online searches, the researchers uncovered that agents and insurers have the edge on the federal government regarding ad placements for Medicare enrollment resources. Agents and insurers paid for 87 percent of the relevant ads, compared to the 7 percent that CMS contributed towards ads.

In order to create a more balanced decision-making process for beneficiaries, the researchers recommended four policy actions.

First, policymakers could consider incentivizing agents to share the number of health plans with which their agencies have contracts when they connect with a consumer as well as their compensation incentives, and personal background.

Second, state or federal leaders could design a marketplace for Medicare agents and assign performance ratings to agents.

Third, policymakers can bolster the Medicare.gov site in order to support consumers’ informed decision-making process.

Lastly, public and nonprofit established to provide Medicare beneficiary enrollment and navigation assistance should receive more support.

“By taking a comprehensive look at the existing model, policymakers may conclude that strengthening regulations of the agent marketplace may not only help consumers make more effective choices but also serve the agents well by creating greater transparency and enabling high-performing agents to better distinguish themselves from their competitors,” the researchers wrote.

“It may behoove policymakers to dig deeper and further understand the sources, nature, and types of information typically available to consumers, whether these resources meet the consumers’ needs, and whether a more comprehensive redesign of the Medicare guidance model is needed.”