EHealth CEO to Medicare Advantage: Extend the Enrollment Period Now

Medicare plan menus are going through big changes, and consumers will need more time to understand what's happening, a health insurance distribution executive says.

Fran Soistman, chief executive officer of eHealth, says the Centers for Medicare and Medicaid Services should take steps now to help enrollees cope with all of the changes in Medicare Advantage plans and Medicare Part D prescription drug plans.

"We believe CMS should consider extending the annual enrollment period or establishing an incremental special enrollment period," Soistman said Wednesday during a conference call with securities analysts.

The annual enrollment period for Medicare Advantage plans and Medicare drug plans that take effect Jan. 1, 2025, is set to run from Oct. 15 through Dec. 7.

Soistman is recommending that officials extend the deadline by about five days, to help plan shoppers cope with the "perfect storm" created by the collision of dramatic 2025 Medicare plan menu changes with general election news and Thanksgiving football games.

So far, Soistman said, CMS officials have listened but have not talked about extending the enrollment period deadline. He wants to keep up the pressure on CMS to take action sooner rather than later.

What it means: Even if you usually have little interaction with Medicare plans, this year might be different.

This could be a year when staying on top of Medicare news and warning clients and friends over 65 about the changes could be important.

Medicare basics: Medicare is a federal program that provides health coverage for people over 65 and for some people with disabilities or severe kidney disease.

About 15 million of the 67 million Medicare enrollees fill the many big original Medicare coverage gaps with Medicare supplement insurance. Medicare supplement policies operate under different federal laws passed in 1992 and do not offer annual open enrollment periods.

About 34 million people use Medicare Advantage plans to fill in original Medicare coverage gaps, and 23 million use Medicare stand-alone programs to pay for prescription drugs. Those are the people affected by the annual enrollment period deadline.

The changes: CMS may have eliminated one potential source of 2025 enrollment period chaos by accepting the ruling of a Texas judge that blocked implementation of agent and broker compensation changes. Distributors had predicted quick implementation of the changes would have paralyzed the 2025 enrollment period.

But Medicare Advantage plan issuers are still facing tighter CMS funding levels, and drug plan providers are still facing the effects of benefits design changes imposed by the federal Inflation Reduction Act of 2022.

Out-of-pocket costs for drug plan users will be lower, but issuers are increasing users' premiums to offset the reduction in out-of-pocket costs.

Those forces are likely to "result in substantial changes to benefit packages, premiums, geographic coverage and other key planned strategies," Soistman said.

Executives at CVS Health, for example, said Wednesday that they expect the Aetna unit's Medicare Advantage plan enrollment to fall 5% to 10% in 2025 because of all of the changes.

EHealth: EHealth was one of the first companies selling insurance online. It now serves 585,000 Medicare Advantage plan participants, 97,000 Medicare supplement insurance users and 196,000 Medicare drug plan users.

Soistman, eHealth's CEO, has been in charge since 2021. He has announced plans to step down from the post by mid-2025.

What eHealth is seeing: Soistman told the securities analysts that the Medicare plan menus for the upcoming enrollment period are "fluid."

"We continue to hear commentary from large carriers about their focus on Medicare margins amid regulatory and medical cost pressures," he said.

Some other Medicare plan distributors are pulling back, and that could further increase the need for Medicare plan enrollment advice, he said.

When eHealth surveyed 500 Medicare users, it found that just 48% read mail from the insurers carefully, and just 71% read at the Annual Notice of Change letters.

About 10% are throwing insurance company mail away without looking at it.

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