Some Medicare beneficiaries who think they were tricked into enrolling in the wrong health plan now have an exit strategy. 

New federal guidelines call for the Centers for Medicare & Medicaid Services to lift the "lock-in" requirement that went into effect March 31 for the rest of 2007. The option to withdraw applies to members of private plans who think they were misled by sales materials or agents.

CMS drafted the new rules in the last week of June, following congressional hearings on abusive marketing practices in Medicare Advantage plans. A number of major carriers, including Tampa's WellCare Health Plans, were accused of letting contract sales agents make misleading statements to win enrollments and commissions.

"Seniors are getting ripped off, and it's not an isolated event; it's a pattern," Sen. Ron Wyden, D-Ore., said at a hearing in May. "We're going to drain the swamp."

The new rules apply to private coverage under Medicare Advantage, sometimes called Part C. About 18 percent of the 43 million Medicare beneficiaries in the nation are enrolled in Medicare Advantage plans.
They new guidelines do not apply to beneficiaries in original Medicare, Medicare supplement coverage or Medicare prescription drug plans.

The CMS press office, which released the new rules to the Tribune on Friday, said the agency began training phone operators at 1-800-MEDICARE as soon as the guidelines were drafted. The guidelines instructed regional offices to give such cases "high priority."

Notification Is An Issue

"I praise them for writing it," said Robert Hayes, president of the Medicare Rights Center, a national advocacy group. But Hayes wonders how Medicare beneficiaries can find out about it, given that CMS has made no announcement.
"Every plan should be required to notify enrollees in simple language how to disenroll" if they were misled about the coverage when they signed on, Hayes said Tuesday.

CMS was under heavy pressure from Congress and the advocacy groups to address the problem. In recent weeks, the Medicare Rights Center's test calls to operators with complaints about wrongful enrollment were mostly turned away.

"This has been a gnawing problem for well over a year," Hayes said. "Every regional office reacted differently, and some reacted differently depending on who picked up the phone."

The guidelines, titled "New Exceptional Circumstances (for a Special Enrollment Period) Based on Incorrect or Misleading Information," allow the phone operators at 1-800-MEDICARE to help beneficiaries leave the plan if they provide "acceptable assurances" that they were given incorrect information about the plan.

The beneficiary "is not required to provide documentation" of what happened but "should provide as much specific detail as possible," such as dates of meetings, names of agents or brokers, or copies of sales materials.

If the beneficiary wants only to leave the plan until the 2008 enrollment period begins Nov. 15, the phone operator can handle it. The beneficiary has a choice of choosing a new plan or returning to original Medicare, in which the government pays 80 percent of doctor and hospital bills.

What Qualifies As Misleading Information?

Some examples of misleading information that would permit a beneficiary to leave the plan include statements that:

•suggest all doctors and hospitals in an area accept the plan's coverage.
•describe the product as a Medigap or Medicare supplement plan. Such plans leave the beneficiary in traditional Medicare, covering the 20 percent that the government doesn't pay. By contrast, a Medicare Advantage plan replaces traditional Medicare and is responsible for all doctor and hospital coverage.
•suggest to potential enrollees that they can switch back to original Medicare "at any time" if they don't like the plan.

The CMS guidelines say beneficiaries are not entitled to leave a plan just because they've changed their minds about what they want, or because their favorite doctors or hospitals have resigned.

When questions crop up, operators are instructed to turn the decision over to a regional office caseworker for investigation. If the first caseworker doesn't think a case meets the criteria, it goes to a second caseworker for review. If both think the case lacks merit, they must notify the beneficiary in writing. Case work is also necessary when a plan member misinformed about coverage has run up medical debts and needs to switch coverage retroactively.

As CMS official Abby Block testified June 26 before the House Oversight and Investigations subcommittee, the agency has always allowed some beneficiaries to leave their Medicare plans on a case-by-case basis, such as when a dementia patient enrolls and can't remember doing so.

But this year, she said, a big jump in enrollment in private fee-for-service plans - which have no networks and leave it to the beneficiary to find a willing doctor - caused massive confusion. The agency was hit with a wave of complaints soon after the enrollments went into effect Jan. 1.

Some regions responded. Notably, CMS' Atlanta office allowed 30,000 members of the Any, Any, Any plan, based in St. Petersburg, to cancel enrollments retroactively. But other members of Medicare Advantage plans nationwide weren't offered the chance or were turned away.