Oklahoma Insurance Commissioner Kim Holland told members of a U.S. Senate committee recently that federal law is impeding the ability of insurance commissioners to protect the elderly who buy Medicare managed care plans.
In testimony before the Senate Special Committee on Aging, Holland said the federal government’s failure to adequately regulate Medicare Part D and so-called Medicare Advantage plans “has led to virtual lawlessness in Oklahoma.”
“Unlicensed agents are setting up shop in pharmacies, large retailers, and nursing home lobbies to prey upon seniors’ confusion and concern over their medical care coverage,” Holland said.
Almost 500,000 Oklahomans are enrolled in Medicare Part D or Medicare Advantage programs but the Centers for Medicare and Medicaid Services, which regulates the programs, has no employees in the state, Holland said. Federal law pre-empts states from regulating the sales and marketing practices of the plans.
“As insurance commissioner, I currently have greater authority to address a consumer’s problem with pet insurance than I do protecting the half a million Oklahoma senior citizens covered under a Medicare Prescription Drug or Advantage plan,” Holland said.
She asked senators to change Medicare regulations to better protect the public.
“Allow me to do the job that I do everyday to assure the financial solvency of companies selling health plans in my state. Allow me to fully deploy the substantial and immediate resources of my office to protect the interests of all policyholders in my state,” Holland said.
Holland documented numerous consumer complaints logged by her office, many describing misleading marketing practices and misrepresentations during the sale of Medicare supplemental products.
She launched the first major investigation of Medicare marketing and documented widespread misconduct by agents working for Humana Insurance Company, the second largest Medicare marketer of private health plans to Medicare recipients in the country.
The investigation led to an order by her office requiring the company to better protect consumers from high-pressure sales tactics.
Holland requires that agents who enroll Oklahomans in Medicare plans be licensed by her office. The Humana investigation, filed last month, found that the company accepted business from 68 agents who were not licensed to sell insurance in the state.
A telephone call by The Associated Press to Dick Brown, director of corporate communications for Humana in Louisville, Ky., was not immediately returned.
The investigation found that Humana agents sold Medicare policies to beneficiaries with lifelong mental conditions and others who did not understand the policies.
In one complaint, a man was switched from traditional Medicare to a Humana plan. He lost the extra benefits that he had under a Medicare supplement policy from Blue Cross and Blue shield of Oklahoma and incurred additional costs when he became ill.
“The member had to borrow against his house to pay for these uninsured hospital and medical expenses,” the report states. “This was solely due to the failure of the agent to properly explain his existing coverage and the impact of purchasing a Medicare Advantage plan.”
On the Net:
Oklahoma Department of Insurance at: http://www.oid.state.ok.us
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