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Feds Crack Down on Medicare Advantage Marketing

Celebrity endorsers must identify whom they represent and not mislead potential MA enrollees


spinner image screengrabs from three tv commercials that advertise medicare advantage plans with well known personalities jimmie walker william shatner and noe namath
YouTube, 2022 Benefits Helpline, Medicare Coverage Helpline

Starting Sept. 30, if Joe Namath, William Shatner or Jimmy Walker wants to sell you on Medicare Advantage (MA), they are going to have to disclose what insurance plan they are advertising. And these television pitches can’t misuse the Medicare logo or card to lead consumers to believe the celebrity endorsers represent the federal government.

It’s all part of a regulation the Centers for Medicare & Medicaid Services (CMS) finalized in April that is designed to crack down on what Health and Human Services Secretary Xavier Becerra has called “misleading marketing schemes by health insurance companies that offer Medicare Advantage plans.”

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Medicare Advantage plans are the private insurance alternative to original Medicare. Enrollment in these plans has exploded in recent years. Federal officials estimate that by the end of 2023, more than half of the 65 million Medicare enrollees will get their health care through an MA plan.

Original Medicare and MA plans differ. Under original Medicare, beneficiaries can go to any provider they choose that accepts Medicare. They have to sign up for a separate Part D prescription plan to get drug coverage, and they often buy a supplemental or Medigap policy to help pay for out-of-pocket Medicare expenses. Under MA, enrollees typically have to go to a doctor or other health care provider that participates in that private insurance plan’s network. MA plans typically include prescription drug coverage, and many cover services that original Medicare doesn’t, such as dental, vision and hearing.

Among other provisions, Becerra said, the new rule “would prohibit overly general ads about the Medicare Advantage program that often tend to confuse and mislead those individuals who are eligible to apply for some of these insurance plans.”

AARP expressed support for the regulation in a Feb. 13 letter sent to CMS leaders when the agency proposed the rule: “AARP has repeatedly raised concerns about marketing abuses around MA plans and supported greater oversight, enforcement and regulation of marketing materials and marketing standards for both MA and Part D [prescription drug] plans.”

Limits on Medicare marketing

“We’ve heard from many seniors and people with disabilities about misleading and confusing advertising for Medicare Advantage and Part D plans,” Meena Seshamani, CMS director of the Center for Medicare, said when the rule was announced April 5. She said this regulation “includes changes to protect people exploring Medicare Advantage and Part D coverage from confusing and potentially misleading marketing practices.”

For example, the regulation makes it clear that an advertisement for Medicare Advantage must specify the name of the plan it is trying to get older adults to join. 

Another step, says Brendan Rose, an AARP government affairs director, is limiting the use of the name Medicare and prohibiting images of the Medicare card in any marketing materials or advertisements. These ads, Rose explained, may look very official and lead people to believe that the toll-free number they call goes to the federal government, when in fact, it’s a private broker or insurance company.

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Brokers must fully explain plans

The new regulation requires brokers, insurance agents and others who market MA plans to fully explain the coverage they sell and to make sure their benefits are actually available in the state or county where a consumer lives.

“A lot of these providers will make a commercial and list all these great benefits without saying that because of where you live, you might not be eligible for these benefits,” Rose says. MA plans are organized around networks of providers that only cover a certain geographic area.

Another provision in the regulation limits the time an agent or other salesperson can contact a potential enrollee and try to sell them an MA plan. Often, Rose said, “members just get bombarded by cold calls on plans that they might be interested in.” The regulation says a broker cannot keep calling someone to sell them a plan 12 months after they first asked for information or expressed interest in a plan.

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