A: The 2025 Final Rule for Medicare Advantage and Part D Plans was first released in April. The significant provisions included new guardrails for data collection and sharing by third-party marketing organizations (TPMOs), agent and broker compensation changes, and several updates to limit cost-sharing and improve enrollee access to supplemental benefits, such as chronic illness and behavioral healthcare.

A: The provision limiting broker compensation for Medicare Advantage plans was recently challenged in court, where a federal judge halted its implementation. The proposed changes would have set fixed amounts that agents and brokers could be paid, starting with the upcoming Annual Enrollment Period (AEP). Implementing these provisions is currently on hold until the lawsuits are resolved. The judicial injunction did not extend to other final rule provisions, such as the TPMO data-sharing rule.

A: CMS has guided that, for the duration of the legal proceedings, it will apply the regulatory language governing compensation and plan oversight that was effective before the changes included in the final rule. Specifically, administrative payments will remain outside the definition of compensation and, therefore, outside of the agent/broker compensation cap. The memorandum is generally silent on the specific impact of the injunction beyond this clarification.

A: Licensed sales agents working with TPMOs must ensure their marketing organizations comply with the new data-sharing restrictions. This includes verifying that TPMOs have obtained the necessary consent from individuals before their data is used for marketing or enrollment purposes. Failure to adhere to these regulations could lead to penalties for TPMOs and the associated agents or brokers. Agents and brokers should also be prepared to explain clearly to beneficiaries about the data sharing and consent process, helping maintain trust and transparency in their interactions.

A: It’s essential for enrollees to be informed about the updates to benefit access that can help them get the most value out of their Medicare Advantage plan. Agents and brokers should explain the Final Rule provisions that will directly affect their plan usage, such as increased access to behavioral healthcare providers and the new mid-year notifications informing them about available supplemental benefits they may not be using. Agents should also explain relevant provisions based on individual client needs, like the reduced out-of-network cost-sharing for D-SNP PPO plans or the new standards for chronically ill supplemental benefits.

A: Changes include shifting costs from the federal government to plans and drug manufacturers. Specific changes include:

• Consolidation of Low-Income Subsidy (LIS) levels: This reduces the cost-sharing and premium beneficiaries pay.
• New Drug Manufacturer Discounts: A 10% discount on brand drugs during the initial coverage phase.
• Increased Plan Costs: In the catastrophic phase, drug plans and manufacturers will bear the most costs.

A: Preparing your client involves:

• Educating Your Clients: Ensure they understand that federal legislation drives significant changes across the industry, including potential increases in premiums, deductibles, and coinsurance.
• Reviewing Plan Changes: Discuss with clients the specific changes to their Part D plans, such as adjustments in benefit phases, formularies, and the introduction of more step therapy and prior authorization requirements.
• Cost-Saving Strategies: Advise clients on cost-saving measures like using generic drugs, preferred pharmacies, or home delivery services.
• Anticipating Cost Increases: Warn clients about higher premiums for standalone PDP plans and increased cost-sharing for brand and specialty medications.
• Encouraging Plan Review: Remind clients to review their Annual Notice of Change (ANOC) in September to understand how their specific plans will be impacted.

Fundamental Changes Related to Plan Members in 2025:

• New Drug Manufacturer Discount: A 10% discount on brand-name drugs during the initial coverage phase will reduce costs for members. However, this may also result in narrower formularies as plans adjust to the new cost-sharing dynamics.
• Elimination of the Coverage Gap: The coverage gap, often called the “donut hole,” will be eliminated. This simplification in the cost structure will make it easier for beneficiaries to understand their out-of-pocket expenses throughout the year.
• Out-of-Pocket Cap: An out-of-pocket cap of $2,000 will be introduced, offering financial protection for members by limiting their annual drug expenses.
• Catastrophic Coverage: Drug plans and manufacturers will cover most costs in the catastrophic coverage phase. While this provides substantial relief for members, it may also lead to higher premiums or more restrictive formularies as plans seek to manage their increased financial responsibilities.
• Medicare Prescription Payment Plan (M3P): Starting January 1, 2025, all Part D members can spread their out-of-pocket prescription drug costs into monthly installments through the Medicare Prescription Payment Plan (M3P). This allows members to pay their costs gradually over the year instead of at the point of sale, providing greater flexibility in managing their expenses.

A: Communication: Clearly articulate the impact of the IRA on Medicare Advantage and Part D plans, including the consolidation of LIS levels and the introduction of new drug manufacturer discounts.

• Stakeholder Meetings: Host meetings or webinars to discuss these changes and their implications for plan administration and member costs.
• Educational Materials: Provide detailed, easy-to-understand materials that explain the upcoming changes and their effects on plan members and the market.

A: The new 10% drug manufacturer discount on brand drugs during the initial coverage phase will affect Medicare Advantage plans by:

• Shifting Costs: This discount shifts some cost burden from beneficiaries to drug manufacturers, potentially leading to changes in how plans manage their formularies and negotiate drug prices.
• Increased Plan Costs: Plans will need to adjust to the increased costs, particularly as they now also bear more responsibility during the catastrophic coverage phase, where their liabilities are expected to triple.

A: Consolidating Low-Income Subsidy (LIS) level 4 into level 1 will benefit Medicare Advantage plan members by reducing out-of-pocket costs. Specifically:

• Lower Cost Sharing: Beneficiaries will experience reduced cost-sharing, leading to lower premiums and out-of-pocket expenses.
• Simplified Subsidy Structure: The consolidation simplifies the subsidy structure, making it easier for beneficiaries to understand their benefits and manage their healthcare costs.

• https://www.cms.gov/files/document/fact-sheet-final-cy-2025-part-d-redesignprogram-instructions.pdf
• https://www.medicare.gov/about-us/prescription-drug-law
• https://www.hhs.gov/about/news/2024/04/01/cms-finalizes-payment-updates-2025-medicare-advantage-medicare-part-d-programs.html

A: The Quarterly Duals SEP has been eliminated for 2025. Two new monthly SEPs have been introduced, including the Duals/Low-Income Subsidy (LIS) SEP and the Integrated Care SEP (allowing beneficiaries to enroll in integrated

D-SNPs, such as FIDE SNPs, HIDE SNPs, or AIPs.

A: Under the new Duals/LIS SEP, beneficiaries can:

• Enroll in any stand-alone Prescription Drug Plan (PDP).
• Disenroll from their Medicare Advantage Prescription Drug (MA-PD) plan and enroll in Fee-for-Service (FFS) with a standalone PDP.
• The Integrated Care SEP allows beneficiaries to enroll in integrated plans like FIDE SNP, HIDE SNP, or AIP.

A: The new SEP rules will primarily affect mid-year enrollments. During AEP, dually eligible individuals can still elect any Medicare Advantage plan, including D-SNPs, but they will need to align their enrollment with the new monthly SEPs starting in 2025.

• Monthly SEPs: Outside of AEP, beneficiaries can now use monthly SEPs to make changes more frequently throughout the year rather than waiting for AEP.
• Shift to Integrated D-SNPs: The elimination of the Quarterly Duals SEP and the introduction of the Integrated Care SEP encourage enrollment in integrated D-SNPs (which may lead to fewer enrollments in non-integrated D-SNPs over time).

A: Beneficiaries who want to enroll in non-integrated D-SNPs or other Medicare Advantage plans will no longer have a special enrollment period throughout the year. They will need to enroll during the designated election periods, such as AEP, and will not have the flexibility of quarterly changes.

Note: Removing this SEP is part of CMS’s broader effort to encourage beneficiaries to move towards integrated care models, such as integrated D-SNPs.

A: To qualify for the Integrated Care SEP, beneficiaries must be fully dual-eligible and seeking enrollment in an integrated care plan such as a FIDE SNP, HIDE SNP, or AIP. The enrollment must be aligned with the integrated plan’s structure to be eligible for this SEP.

• https://justiceinaging.org/upcoming-changes-for-dually-enrolled-individuals/#:~:text=1%2C%202025)
• https://www.cms.gov/newsroom/fact-sheets/contract-year-2025-medicare-advantage-and-part-d-final-rule-cms-4205-f
• https://www.medicare.gov/basics/get-started-with-medicare/get-more-coverage/joining-a-plan/special-enrollment-periods
• https://www.kff.org/medicare/issue-brief/10-things-to-know-about-medicare-advantage-dual-eligible-special-needs-plans-d-snps/