Where Medicare Advantage Marketing is Coming From

Marketing practices have caused CMS to put rules in place to curb deceptive or inaccurate ads.

Medicare Advantage (MA) marketing has come under scrutiny for unscrupulous tactics, but where exactly is it coming from?

According to a report from the Commonwealth Fund, non-government entities account for one-third of all Medicare-related search records and 87% of all search engine ads, creating confusion for beneficiaries and consumers struggling to select an appropriate health plan.

"Medicare Advantage plans are promoted through direct mailings, telemarketing, and advertising on radio, television, websites, and social media channels," the researchers state. "No organization, including the federal government, directly 'markets' traditional Medicare, although commercial insurers sell supplemental Medigap and Part D plans for people in traditional Medicare. Thus, nearly all beneficiaries are subject to some form of marketing effort."

When users search for information on Medicare, 20% of the records are from agents, brokers, or partners, while 16% are from health plans. CMS is responsible for the largest share of search records at 27%.

When it comes to search engine ads, agents, brokers, and partners make up 55% and health plans an additional 32%. CMS only has 7% of the ads, tied with other for-profit organizations.

While 40% of Medicare beneficiaries do not receive any help with their plan choice, the ones that do most often turn to brokers and agents for guidance – 30% in traditional Medicare and 31% in MA.

As brokers and agents are paid commission by insurers, beneficiaries can be negatively influenced. Researchers for the Commonwealth Fund highlight that CMS has reported more than 41,000 complaints in 2021 about Medicare private plan marketing, which was double the number in 2020 and up from about 6,000 in 2017.

To alleviate complaints and combat misleading marketing practices, CMS has proposed a rule to prohibit ads that don't mention a specific plan name, as well as ads that use words, imagery, language, or logos that can be confusing and deceptive.

It is unclear, however, if the restrictions put in place will affect outcomes. Researchers believe more needs to be done to better understand what information is accessible for Medicare beneficiaries.

"Additionally, more information about agent and broker compensation — including overrides and payment for other services such as health risk assessments, as well as more transparency around the relationships between health care providers, TPMOs, and insurers — could help CMS ensure a level playing field and assess whether compensation and other financial arrangements are aligned with beneficiaries' interests," the researchers concluded.