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Poolman Warns About Abusive Medicare Marketing Practices
May 24, 2007 701-328-2440

Bismarck, ND - North Dakota Insurance Commissioner Jim Poolman today warned seniors to be aware of abusive and aggressive sales tactics revolving around the marketing of Medicare Advantage plans. The result of these tactics is that some seniors may feel pressured into purchasing a policy that is not of benefit to them and may replace coverage they already have that is working well for them. 

Poolman said, "We have many reports of seniors who have inadvertently signed up for a Medicare Advantage Plan thinking they were buying a Medicare supplement plan. We are also getting a number of complaints on agents who have misled seniors into switching from their Medicare coverage to a Medicare Advantage Plan without their knowledge." 

Medicare Advantage plans are not traditional Medicare. They are private health plan options approved by Medicare but sold and administered by private insurance companies. Advantage Plans replace Medicare Part A coverage (hospital) and Medicare Part B coverage (medical), and are required to cover medically necessary services. Although Medicare Advantage Plans (also called Part C) are not provided through the federal government, they are still considered part of the Medicare program and companies who sell them must be approved by Medicare. 

According to Poolman, "Medicare Advantage Plans can serve a valuable purpose for many, however it is very important for seniors to do their research and make sure that this sort of plan is the right choice for them." He warned that not all doctors or hospitals accept all Medicare Advantage plans and that sometimes there are higher out-of-pocket costs and co-pays associated with these plans.

The Insurance Department is currently monitoring complaints about Medicare Advantage plans and the agents selling them. An investigation is underway into the alleged abusive sales practices. In addition, Poolman has written a letter to both the Centers for Medicare and Medicaid Services (CMS) and North Dakota's congressional delegation outlining the alleged sales practices and articulating the Department's appeal for additional regulatory authority over these entities.

"This situation has been increasingly frustrating. CMS is becoming less responsive to our requests for assistance to help North Dakota seniors," said Poolman. "It is becoming increasingly clear that if our Department is expected to hold agents and companies accountable, we need the regulatory oversight to properly do so." The North Dakota Insurance Department approves general health insurance plans as well as Medicare Supplement plans but does not have regulatory authority over Medicare Advantage Plans.

"I am hopeful that by working hand in hand with CMS and our congressional delegation we will successfully address our need for more regulatory oversight so that I am better able to protect seniors across the state from these unfair and abusive sales practices," said Poolman.

Anyone who thinks they may have been the victim of abusive sales practices, or has been switched to a Medicare Advantage plan without knowledge or full consent or has questions about Medicare Advantage plans should call the Senior Health Insurance Counseling (SHIC) program at 1.888.575.6611.

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Letter to CMS

Letter to Representative Pomeroy

North Dakota Insurance Department
600 E. Boulevard Ave.
Bismarck, ND 58505-0320
Phone 701.328.2440
Toll free 800.247.0560
Fax 701.328.4880

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