As a result, millions of people with Medicare who are seeking prescription drug coverage are now in the sights of sales departments and marketing agents for insurance companies selling both Part D stand-alone drug plans and Medicare Advantage (MA) plans. Legislative hikes in reimbursement and profitability for Medicare Advantage plans triggered an explosion in the number and type of Medicare Advantage plan designs and in aggressive marketing tactics employed by insurance companies seeking to maximize their Part D market share by encouraging their Part D enrollees to switch to their more lucrative line of Medicare Advantage products.

Because of the limited enrollment window of once a year (which typically ends March 31 each year), it is more economical for companies to use independent brokers, paid on commission with minimal oversight, rather than a salaried sales force. There are some special enrollment periods (SEPs) that allow for monthly plan switches by dual eligibles, which makes older adults with low incomes a target of brokers selling Part D and MA plans. I am told that some plans are paying agents up to five to six times the commission to switch enrollees or sell MA plans, whether or not they are the most suitable for the consumer. Agents typically earn between $60 to $80 for each Part D enrollment, but between $400 to $500 for enrollment in an MA product. Of all the MA products, the marketing of private-fee-for-service (PFFS) plans generates the largest capitated payments to the plan, averaging 119 percent of the average cost of care in original Medicare, well above the MA average rate of 112 percent of the average cost of care under original Medicare. Enrollment in PFFS plans has skyrocketed, rising to more than 800,000 in the fall of 2006, with the number of plans offered increasing 25-fold over two years. Half of all new Medicare Advantage plans being offered in 2007 are PFFS plans.

The main selling point for PFFS plans is that they do not restrict enrollees to a specific network of providers. Instead, PFFS plans rely primarily on "deemed" providers who knowingly provide services to plan members and are therefore required to accept the plan’s conditions and payments. Physicians who refuse to provide services to plan members are noncontracted providers. In the marketing pitch, prospective enrollees are told, "You can see any doctor you want," or "You can see any doctor that accepts Medicare," without regard to which providers will actually accept the plan’s payments.

In fact these enrollees only can go to a provider willing to accept the PFFS plan’s fees and terms. Early experience with PFFS plans shows that in some cases providers have discovered retroactively that they are "deemed" to be under contract to the plan and must accept the terms and payment of the plan. In some instances the plans can reimburse doctors at rates less than standard Medicare reimbursement rates. Also, some doctors feel forced into an unacceptable choice of either abandoning established patients who sign up for PFFS plans or having to accept the terms of participation. Sadly, although other Medicare Advantage coordinated care plans are required to maintain an adequate provider network, PFFS plans have no such requirement. Interestingly, Congress specifically did not authorize states to regulate or enforce Medicare Part D and Medicare Advantage plans.

When providing services to patients enrolled in a Medicare Advantage private fee-for-service plan, keep the following details in mind :

• If you furnish services to a PFFS enrollee who is not covered by the plan, the PFFS organization is not required to pay for the service.

• A physician is a deemed provider and must follow a PFFS plan’s terms and conditions of participation if the following conditions are met: (a) in advance of services the physician knows that a patient is enrolled in a PFFS plan and (b) the provider either possesses or has access to the plan’s terms andconditions of

participation.

• A physician is not required to furnish health care ser- vices to enrollees of a PFFS plan. However when a provider chooses to furnish services to a PFFS enrollee and the deeming conditions have been met, the physi- cian is automatically a deemed provider for that en- rollee and must follow the PFFS plans terms and conditions.

• If a physician furnishes services to a PFFS enrollee but the deeming requirements are not met, then the provider becomes a noncontracting provider.

• When a noncontracted physician furnishes plan- covered services to a PFFS enrollee, he or she is entitled to receive in payment the amount the provider would have received as payment in full for a given service by original Medicare. The amount a physician is al- lowed to collect from the enrollee combined with the amount the PFFS plan pays cannot be less than what the noncontract provider would have received for the service under original Medicare. The noncon- tract physician can only collect from the PFFS enrollee the amount allowed by the plan’s terms and conditions of participation.

• If a provider is deemed and furnishes services to a PFFS enrollee, the provider is responsible for collecting the allowable cost sharing from the PFFS enrollee, as specified under the plan’s terms and conditions.

• Noncontracted physicians are entitled to receive what they would have received under original Medi-care for furnishing a given service. The amount the provider is paid includes the amount the plan allows the provider to collect from the enrollee and the amount the plan pays the provider directly. If the total amount received by the provider, including cost sharing from the enrollee, is less than the provider would have been paid under original Medicare, the plan must pay the provider the difference.required to pay for the service.

• You are not required to see an enrollee in a PFFS plan; however, if you furnish care to a PFFS enrollee and the deeming conditions have been met, you are bound by the PFFS plan’s terms and conditions of participation.

• If you bill Medicare for PFFS claims for services pro- vided to enrollees of a PFFS plan, you will not be paid by Medicare and will be rejected. Physicians must bill the PFFS organization their patients are enrolled in.