CMS Regulations and Carrier Policies

The Center for Medicare and Medicaid Services (CMS), the federal watchdog that oversees insurance carriers (officially, “plan sponsors”) and insurance agents, enforces regulations regarding the conduct of and communication from both sponsors and agents. The regulations affect many aspects of the industry but impacting agents most directly in their marketing practices (of course, they also affect your compensation, annual certifications, and ethical obligations).

Plan sponsors are regulated directly by CMS, but agents are regulated by the plan sponsors. And guess what! The plan sponsors interpret the CMS regulations differently from one another, often instructing agents to conduct themselves in contradictory ways. In other words, there is no final word on what is ultimately compliant and not compliant until a judgment is made, a license is revoked, a fine is levied, or an appointment withdrawn. Even calling CMS will not yield a definitive answer; what one federal employee says one minute will be contradicted by what a different one says the next minute.

Fortunately, there is usually enough of a consensus that such ambiguity does not endanger your business. Although we cannot guarantee our interpretation of what is compliant and not, (no one but CMS can and they choose not to), we can give you reasoning as you consider various options. So, if you are considering creating your own direct mail piece, a radio spot, print advertising, or other marketing communication, consider us as one of your business’ resources. We will spend time on your project and give you our best advice.

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