In a twist, Medicare Advantage insurers try to avoid selling plans

Aetna, Cigna and Elevance Health sell Medicare Advantage plans. But that doesn't necessarily mean they want people to buy them.

Partway through the Medicare annual enrollment period for 2025, which started Oct. 15 and ends Dec. 7, those three insurers stopped offering commissions to brokers and other third-party marketers who steer new customers toward some of their Medicare Advantage products.

Related: How Highmark, Alignment earned top Medicare Advantage star ratings

Sam Melamed, CEO of the dental and vision insurer NCD and founder of a social media platform for brokers and agents called Insurance Forums, has never seen anything like it.

Melamed attributes this anti-marketing tactic to insurers not liking how their newest enrollees look, cost-wise. "They've started to see volume and they're scared," he said. The Centers for Medicare and Medicaid Services projects Medicare Advantage enrollment will grow 4% to 35.7 million for 2025.

CVS Health subsidiary Aetna, Cigna and Elevance Health ended commissions in Connecticut, Georgia, New York and Texas. Those are all markets where competitors pulled out or pulled back for the coming plan year, according to the data analytics company Deft Research.

Aetna, Cigna and Elevance Health, it seems, don't want the members their rivals left behind for the same reasons those other companies left them behind: they are too expensive to cover.

Medicare Advantage companies are prioritizing profit margins over market growth after dealing with higher-than-expected medical expenses, adverse regulatory changes and anxious shareholders this year. Their strategy represents a reversal from previous years, and is complicated by rivals withdrawing from more markets in 2025.

Market exits are driving more new members to sign up than the insurers hoped, spurring them to act, said Helaine Fingold, an attorney who focuses on managed care at the law firm Epstein Becker & Green. "Once one stepped forward to cut commissions, the others felt empowered to do the same," she said.

Insurers that cut commissions aim to reign in membership growth while renewing their existing enrollees, Fingold said. Insurers often say that the longer they can retain customers and learn about their needs and costs, the more profitable they are.

Aetna, Cigna, Elevance commission cuts

Aetna will not compensate marketers for signing up customers in 25 Medicare Advantage plans in nine states and the District of Columbia. The insurer routinely reviews and updates its strategy, a spokesperson wrote in an email.

Cigna no longer pays commissions for enrollments into nearly 80 plans in 25 states and the District of Columbia. The shift affects fewer than 3% of Cigna’s targeted sales in each market, except in New York, Cigna wrote in a message to brokers. The insurer also is selling its Medicare Advantage assets to the Blue Cross and Blue Shield licensee Health Care Service Corp. Cigna did not respond to an interview request.

Elevance Health suspended commissions for more than 65 Wellpoint Medicare Advantage plans in 15 states. That includes products that are the subject of a lawsuit against CMS over the company's Medicare Advantage star ratings.

"This is not a decision that we took lightly, but it was the right thing to do." Elevance Health Chief Financial Officer Mark Kaye said during the UBS Global Healthcare Conference on Tuesday. "Heading into [the annual enrollment period], we anticipated significant disruption, and even more so once we determined that nearly 2 million members have received notices of upcoming plan termination," he said. The company did not respond to an interview request.

Similarly, Centene is not paying marketers that enroll new customers into its Medicare Part D prescription drug plans.

Insurers also recently updated their enrollment practices to make it harder for marketers to sign up new members, said Amanda Brewton, owner of Medicare Answers Now, a field marketing organization.

UnitedHealth Group, which assured investors last month that it's optimistic about Medicare Advantage, nevertheless pulled four UnitedHealthcare plans in California from brokerage enrollment websites, which means marketers have to close sales by telephone, on Medicare.gov or on paper. This affects less than 1% of the company's Medicare Advantage plans, a UnitedHealthcare spokesperson wrote in an email.

“You're going to do far less enrollment via phone and through Medicare.gov than you are when you have agents having access to doing all sorts of things,” said Brewton, a member of the National Association of Benefits and Insurance Professionals' Medicare advisory group. “It hurts agents and it hurts seniors.”

Humana, second to UnitedHealthcare in Medicare Advantage market share, has not altered its commissions policy this annual enrollment period, a spokesperson confirmed. "We have not made any changes to our Medicare Advantage plan commission schedule — nor do we intend to," Humana wrote in a notice distributed to third-party marketers.

'Cherry-picking' concerns

Unlike under the rules governing the health insurance exchanges, there's nothing prohibiting Medicare Advantage carriers from altering compensation to third-party marketers to avoid less healthy and more costly members, a practice known as "steering" or "cherry-picking."

“If you're pulling commissions and information from that plan, then ultimately you are steering people to the plans you want them to buy,” said Ronnell Nolan, president and CEO of Health Agents for America, a trade group. The federal government should apply the exchanges rule to the Medicare market, she said.

Yet reducing or eliminating commissions, even in the middle of enrollment season, isn't very different from the norm, said Katherine Hempstead, a senior policy advisor at the Robert Wood Johnson Foundation, a healthcare research organization. Insurers routinely offer greater compensation to brokers and independent agents who sell favored products. “There already is steering," she said.

Both that standard practice and the unusual cases of Aetna, Cigna and Elevance Health raise questions about whether these arrangements between insurance companies and marketers do Medicare beneficiaries any good, Hempstead said. "Should you instead pay brokers in a different way, so they're not getting paid by plans, they’re just getting paid for helping customers?” she said.

For better or worse, what Aetna, Cigna and Elevance Health are doing may not have the effect they desire, said Gretchen Jacobson, vice president of the Medicare program at the Commonwealth Fund, a think tank.

Thirty percent of Medicare Advantage customers consult brokers or agents versus 37% who do not, the Commonwealth Fund found in a 2022 survey. The remainder do their own comparison shopping, consult friends and family, or take advantage of state-funding enrollment assistance, according to the survey.

“Thirty percent is still large, but it's not the only driving factor,” Jacobson said.

Lauren Berryman contributed to this story.