The document notes paying different compensation to agents and brokers for coverage in the same benefit year based on whether the enrollment is completed during a special enrollment period or open enrollment period is prohibited.
Last week, the Centers for Medicare & Medicaid Services (CMS) posted FAQs regarding compensation paid by issuers to agents and brokers who assist consumers with enrollment during a special enrollment period (SEP) or open enrollment periods (OEPs).
The FAQ document comes at a time when some health insurance issuers in the individual market, who commonly use agents and brokers as part of their marketing and sales distribution channels, have reduced or eliminated commissions and other forms of compensation to agents and brokers for enrollments during an SEP.
The document provides guidance that paying different compensation to agents and brokers for coverage in the same benefit year based on whether the enrollment is completed during an SEP or the OEP is prohibited under federal law and that these practices violate the guaranteed availability protections afforded to these individuals under the Affordable Care Act.
CMS also notes that if an agent believes that an issuer's compensation arrangement or other marketing practice violates applicable federal or state law, they should contact the applicable state authority. Or, in states not enforcing the applicable Affordable Care Act market reform provisions, contact CMS.
Wyatt Stewart is Big “I" assistant vice president of federal government affairs.