Welcome back to our third article, which continues our analysis of the “Big, Beautiful Bill” and its changes and agent impacts. Today, we analyze the Medicare world.
Our first and second articles discuss the ACA, and a recent KFF article also discusses this in depth.
Here are more items in the bill that agents need to know about:
Limiting Medicare Coverage of Certain Individuals
- Medicare is available to U.S. citizens, green card holders, certain immigrants from Cuba, and people in the U.S. under the Compacts of Free Association.
- People in the U.S. with Temporary Protected Status, refugee status, or asylee status cannot be on Medicare.
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- The individuals listed in the second bullet currently receiving Medicare benefits will not lose Medicare coverage eligibility for one year following the enactment of this bill.
Opportunity for Agents
Inform any clients meeting the criteria listed above that they will lose Medicare eligibility in a year from the enactment of this bill, letting them know they don’t need to act for now.
Eligibility and Enrollment Final Rule
Implementing the September 2023 CMS Final Rule on Enrollment of Medicare Beneficiaries in Medicare Savings Plans (MSPs) is delayed 10 years to January 1, 2035.
Opportunity for Agents
Find a great tool like the Benefits Checkup from the National Council on Aging (NCOA) that you can leverage to assist low-income people on Medicare without MSPs or the low-income subsidy in applying for these programs if they qualify.
Physician Fee Schedule Conversion Factor Adjustment (effective January 1, 2026)
- Ties the annual statutory increases to the Physician Fee Schedule to the Medicare Economic Index (MEI) measure of inflation in medical practice costs. The conversion factor increases by 75% of the projected MEI increase in 2026 and 10% of the projected MEI increase in all subsequent years.
- It applies the same annual MEI-based conversion factor increases to all Medicare providers, regardless of their participation in Advanced Alternative Payment Models (A-APMs).
Opportunity for Agents
- Increase outreach to primary care physicians in your markets, finding opportunities to partner with them in community outreach programs and patient education about the Medicare program.
- Emphasize your positive experience and thoughts about Medicare, letting physicians know your partnership is positive and has the potential to grow to each of your benefits.
Orphan drugs
- Will change the orphan drug exclusion to include drugs designated for one or more rare diseases or conditions with an approved indication or indications for one or more rare diseases or conditions.
- The period drugs are on the market with only one or more orphan indications doesn’t count toward the 7-or 11-year time frame for determining selection eligibility.
- This applies to the 2026 drug price selection for negotiated prices available on or after January 1, 2028.
Opportunity for Agents
- Learn your clients’ high-priced drugs now to prepare.
- Lower prices for higher-cost drugs can be negotiated in 3 years (2028).
Rules for Pharmacy Benefit Managers (effective January 1, 2028)
- PBM Part D compensation must be flat dollar “bona fide service fees,” with no compensation based on drug price or rebate arrangements.
- PBM transparency and reporting requirements include utilization data, pricing, formulary-covered drug revenues, PBM-affiliated pharmacies, contracts with drug manufacturers, and other PBM business practices.
Opportunity for Agents
With these changes, carriers will be able to lower drug costs starting in 2028, making lower copays and deductibles possible for Medicare Part D clients.
Rural emergency hospitals (effective January 1, 2027)
Expands the rural emergency hospital designation eligibility to qualifying hospitals open from January 1, 2014, to December 26, 2020, but are closed now to reopen as rural emergency hospitals.
- These hospitals must be:
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- At least 10 miles from the nearest hospital to receive the fixed monthly facility payments and
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- At least 35 miles from the nearest hospital to receive increased outpatient prospective payment (OPPS) reimbursement.
Opportunity for Agents
Rural Medicare agents will have the possibility of more emergency hospital care in their areas after January 1, 2027, to meet their clients’ emergency needs.
Nursing Home Staffing Final Rule (effective upon enactment)
The Secretary of Health and Human Services can’t implement, administer, or enforce the minimum staffing levels in this final rule.
Opportunity for Agents
Long-term care and skilled nursing facility costs covered by Medicare may decrease, resulting in lower cost shares for your Medicare clients to pay.
Health Savings Accounts (HSAs) (effective January 1, 2026)
- People aged 65 or older enrolled only in Medicare Part A may continue contributing to an individual HSA. They may not use HSA distributions to pay health insurance premiums.
- The HSA funds not used for qualified medical expenses are subject to an additional 20% tax.
Opportunity for Agents
Inform clients aged 65 and over about this change in law. Let them know that if they have an HSA from their job, they can continue contributing to it and using the funds to pay for the covered HSA medical expenses they incur.
Using Artificial Intelligence (AI) to Identify Improper Payments (effective January 1, 2027)
Provides funds for CMS to contract with Artificial Intelligence (AI) contractors to develop AI to identify and reduce improper Medicare payments and recoup overpayments.
Opportunity for Agents
Medicare Supplement policies are less likely to be impacted by this activity and are a good product to have in your portfolio to maintain and grow Medicare revenue.
At this time, Agility cannot confirm if these provisions will continue in the bill being approved by the U.S. Senate or in the final bill passed by both the U.S. House and U.S. Senate. We will keep you informed on the latest news about this bill in our blogs.
Carolina Alcorta, our Medicare product specialist, is here to help you with any questions about these changes and the opportunities they present to Medicare agents. Carolina can also refer you to our Supplement product specialist to answer any questions specific to supplemental products.
Contact Agility Producer Support at (866) 590-9771 or email support@enrollinsurance.com to answer any other insurance questions. Agility can also add you to our free weekly email list for tips and vital information!
Our next article will cover the “Big, Beautiful Bill” changes and agent impacts on ICHRA.
