[Congressional Record Volume 144, Number 93 (Tuesday, July 14, 1998)]
[Extensions of Remarks]
[Page E1295]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    INTRODUCTION OF THE MEDICARE+CHOICE COLD-CALLING PROHIBITION ACT

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                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                         Tuesday, July 14, 1998

  Mr. STARK. Mr. Speaker, I rise today with a number of my colleagues 
to introduce ``The Medicare+Choice Cold-Calling Prohibition Act.'' This 
bill would prohibit unsolicited telemarketing sales of new 
Medicare+Choice health plans to Medicare beneficiaries.
  Under the new Medicare+Choice program developed in the Balanced 
Budget Act of 1997 (BBA), Medicare beneficiaries will no longer have 
only a choice of traditional Medicare or HMOs. Seniors will now get to 
choose among an alphabet soup of additional options such as PPOs, PSOs, 
POSs, Private FFS, and MSAs. All of this would undoubtedly lead to real 
confusion.
  Adding to that confusion will be the fact that many more private 
health insurance programs will be competing to capture large segments 
of the Medicare population.
  The Balanced Budget Act of 1997 recognized the power of these 
insurance advertising budgets to sway seniors into decisions that may 
not be in their best interest. The law requires that marketing 
materials be submitted to the Health Care Financing Administration 
(HCFA) for review and that fair marketing standards be followed that 
prohibit cash or monetary rebates as an inducement to enroll.
  HCFA's proposed regulation for implementing the BBA go even further. 
They prohibit insurance companies from marketing their products door-
to-door, forbid misleading activities in marketing practices (such as 
intimating that the government endorsed their plan), and the plans must 
market to the disabled population as well as seniors. While all of 
these protections are good, they don't go far enough.
  In addition to adding new managed care options to the Medicare 
program, the BBA greatly enhanced the ability of states to enroll their 
Medicaid populations in managed care. The marketing protections for 
Medicaid enrollees actually go further than those for Medicare 
beneficiaries. The BBA ensures that managed care plans ``shall not, 
directly, or indirectly conduct door-to-door, telephonic, or other 
`cold-call' marketing of enrollment under this title.'' So, our 
Medicaid population is protected from becoming prey to telemarketers 
whose paychecks depend directly upon the number of healthy risks that 
they sign up for the plan.
  Unfortunately, our nation's Medicare beneficiaries are not protected 
from telemarketers. And, we know the senior population is especially 
vulnerable to a well-honed health insurance sales pitch. Many of you 
will recall the evidence we uncovered in the late 1980's that pushed us 
to enact standardized Medigap policies and to prohibit the sale of 
duplicative policies. We found seniors who were literally paying for a 
dozen Medigap plans--most of which covered the exact same benefits! 
And, a dozen policies for one individual wasn't even the most egregious 
of the examples.
  That's why we rise today to introduce the Medicare+Choice Cold-
Calling Prohibition Act''. This bill does exactly what its title 
indicates--it would protect our seniors from being inundated with 
unwanted sales pitches. It provides the same protections granted to our 
Medicaid recipients to Medicare beneficiaries.
  The BBA Medicare changes are significant--the most significant 
changes made to the program since its inception in 1965. It is 
important that Medicare beneficiaries learn as much as possible about 
these changes and make sure that the choices they make are in their 
best interest. The unfortunate reality is that we know from past 
practices that telemarketers will not be looking out for seniors' best 
interests. They will be looking out for making the biggest commissions 
possible. That's why passage of the Medicare+Choice Cold-Calling 
Prohibition Act is so important.

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