“TPMOs” and the Danger of Industry Labels

By Fran Soistman, CEO of eHealth, Inc.

When you were in elementary school, was your entire class ever punished for the misbehavior of two or three troublemakers? The injustice of it can sting. Kids have a finely tuned sense for what’s fair, and they naturally resent it when blamed for the misconduct of others.

Today, many licensed agents and independent brokers who serve the coverage needs of Medicare beneficiaries feel the same way about being lumped together with very different organizations under the umbrella term “Third-Party Marketing Organizations” or TPMOs.

The Centers for Medicare and Medicaid Services (CMS) is committed to protecting Medicare beneficiaries. In alignment with CMS and our carrier partners, eHealth is equally committed to this objective. But in their application of the TPMO label, regulators imply that licensed online marketplaces like eHealth – the company I’m privileged to lead – don’t have consumers’ best interests at heart.

Nothing could be farther from the truth. As described in our company’s Beneficiary Pledge, we are dedicated to performing our responsibilities with the highest degree of ethics and integrity, meeting government regulations and insurer standards to protect the rights and interests of those we serve.

The TPMO category misrepresents the majority

As CMS and the Senate Finance Committee expand their scrutiny into the role of TPMOs in the Medicare market, they run the risk of punishing those working honorably for the good of beneficiaries.

CMS currently defines TPMO to include “all organizations and individuals, including independent agents and brokers, who are compensated to perform lead generation, marketing, sales, and enrollment related functions as part of the chain of enrollment.”

So defined, TPMO includes state-licensed agents and marketplaces like eHealth together with unlicensed lead generators. While many lead generators are essential partners in the enrollment process alongside brokers and carriers, some have made their business model the pursuit of short-term profit at the expense of beneficiaries’ actual needs. Lead generators collect contact info from interested beneficiaries; unlike licensed agents, they cannot provide personal advice and assistance, and cannot enroll a beneficiary in a new Medicare plan.

Let me be clear: Any marketers who prey on Medicare beneficiaries by misrepresenting themselves, providing misleading information about plan benefits and costs, or scaring beneficiaries into taking actions that run counter to their best interests, have only themselves to blame for inviting the ire of market regulators whose duty it is to protect consumers.

But why should regulators categorize state-licensed agents and brokers in good standing – who are already answerable to CMS, state insurance commissioners, the insurers they represent, and the beneficiaries they serve – with others who are unlicensed and answerable to no one?

eHealth: a case study in putting consumers first

Let me describe how we operate at eHealth, a nationally licensed health insurance marketplace. Then you can decide if we’re fairly or unfairly included under the TPMO label.

eHealth was founded in 1997 to empower consumers by bringing transparency to health insurance decisions. Our innovations allowed consumers to compare competing health plans side by side and enroll online. eHealth helped define the health insurance education, shopping, and enrollment experience for the digital age.

Serving Medicare beneficiaries today, we offer a broad selection of Medicare Advantage, Medicare Supplement, and Medicare Part D plans from national, regional, and local health insurance companies. We maintain licensure in all 50 states plus D.C., and we work in concert with our carrier sponsors, which include non-profit as well as publicly traded, local, regional, and national insurers, to ensure compliance with all CMS regulations.

In our website experience, online content, and television ads, we reject high-pressure sales pitches and smokescreens. Through educational materials, online tools, and personal help from licensed agents, we empower beneficiaries to find the right Medicare plans for their needs and budget – plans that cover their preferred doctors and their prescription drugs at a price they can afford.

We expect our licensed agents to treat Medicare beneficiaries like their own parents or grandparents: with patience and compassion. Our agents are commission-blind and paid the same no matter which Medicare Advantage or Medicare Supplement plan the customer selects, and they are rewarded when customers are so satisfied with their coverage that they retain their plan for a longer period.

With over 25 years in the health insurance market, we’re here to build lifelong relationships. When our customers’ needs change over the years, we want them to trust that eHealth is on their side.

Let’s reconsider the TPMO label

As a nationally licensed online health insurance agency and marketplace, powered by over a thousand licensed agents committed to those they serve, we’re held to appropriately high standards. We’re proud of the service we provide. That’s why we feel our agents and our organization are unfairly disparaged by the TPMO label as it is applied today.

There will probably never be an industry completely free of wolves in sheep’s clothing: outliers who dishonor their profession by unethical conduct. That doesn’t make it right to label all sheep as wolves.

Let’s start a conversation in the industry and revisit the outmoded TPMO label. Rather than treating lead generators, licensed independent agents and brokers, and licensed online marketplaces all the same, shouldn’t each be scrutinized separately based on their distinctive business models, licensure, and credentialing?

Tell me what you think. I look forward to your thoughts.