Tactics on Medicare draw ire

WASHINGTON — Bush administration officials say they have received scores of complaints about the aggressive tactics used by some insurance companies and agents to market Medicare's new prescription drug benefit.

The officials said they would take disciplinary action if they found that the tactics had broken federal rules.

Possible violations reported to officials in the past few weeks include uninvited door-to-door solicitation of business and misrepresentation of insurance products.

Federal and state officials said they had also received complaints that some insurance agents identified themselves as working for the Social Security Administration or the federal Centers for Medicare and Medicaid Services.

In addition, they said, some insurance agents have asked beneficiaries for personal information like Social Security numbers and credit card or bank account numbers.

"These steps are illegal, totally inappropriate and unacceptable," said Patricia P. Smith, who works with health plans as director of the Medicare Advantage Group at the Centers for Medicare and Medicaid Services. "They not only endanger the beneficiary. They could endanger the program. This will draw the ire of people who are legitimately looking at the program to make sure beneficiaries are protected."

The federal government can take a range of compliance actions, like imposing a corrective action plan on an insurer or freezing its enrollment. States can fine insurance agents and suspend or revoke their licenses. Insurers are rushing into the Medicare market, offering drug coverage to 42 million people who are 65 and older or disabled. The new drug benefit is heavily subsidized by the federal government, but will be delivered by private health plans and insurers. Many of the insurers have little experience with Medicare. Marketing began on Oct. 1. The benefit takes effect on Jan. 1.

Federal officials have issued rules and a 53,000-word set of guidelines for marketing the drug benefit. The guidelines allow use of insurance agents, including independent agents who represent more than one company, but stipulate that insurers are responsible for the conduct of their agents.

Christopher Eisenberg, director of health plan accountability at the federal Medicare agency, said the federal government had received "more than 100 complaints concerning misconduct by independent agents" marketing Medicare products. "This is developing into a major compliance concern," Eisenberg said, and "it appears to be growing."