Anti-Fraud Strategies Face the Ultimate Challenge in ACA Enrollment Season

Recent data suggests a significant decline in unauthorized switching of Affordable Care Act (ACA) plans, with federal regulators reporting a nearly one-third decrease in consumer complaints. The Centers for Medicare & Medicaid Services (CMS) has attributed this decline to new measures aimed at preventing enrollment issues that previously resulted in over 274,000 complaints by August of this year.

The annual ACA open enrollment period, which commenced on November 1, presents a critical challenge. Will the newly implemented changes effectively combat fraud by rogue agents while avoiding unnecessary complications for consumers enrolling in 2025 coverage?

“They really have this tightrope to walk,” noted Sabrina Corlette, co-director of the Center on Health Insurance Reforms at Georgetown University. The balance between fraud prevention and maintaining accessible enrollment processes is delicate, and increased restrictions might inadvertently obstruct those seeking necessary coverage.

To enhance security, CMS announced in July that policy changes involving agents not affiliated with an existing plan would require a three-way call with the consumer, the broker, and a representative from healthcare.gov. Furthermore, in August, the agency prohibited two private online-enrollment platforms from accessing healthcare.gov due to concerns over improper switching. In total, around 850 agents suspected of unauthorized plan-switching have had their access suspended.

While these preventative measures may reduce fraud, they could complicate the enrollment process for consumers. A three-way call may require waiting in line, leaving some consumers scrambling to find a new agent if their previous one faced suspension. Analysts advise early action due to expected high call volumes, especially as the mid-December deadline approaches.

“Hit the ground running,” urged Ronnell Nolan, president and CEO of Health Agents for America, emphasizing the urgency of initiating the enrollment process sooner rather than later. Reports indicate that some rogue organizations are already devising ways to circumvent the new anti-fraud protections, illustrating ongoing vulnerabilities in the system.

Despite attempts to streamline the process, brokers still account for a majority of active ACA enrollments, earning commissions from insurers for their services. Consumers have the option to enroll independently online or seek assistance from certified navigators who are compensated differently. The federal and state ACA websites feature a “find local help” button that allows consumers to locate available brokers or navigators.

CMS is bolstering its call center operations in anticipation of increased demand for three-way calls, committing to offer minimal wait times, according to Jeff Wu, deputy director for policymaking at the CMS Center for Consumer Information and Insurance Oversight. However, these calls are only necessary for agents not already affiliated with a consumer’s enrollment.

Some navigators, like those from Florida Covering Kids & Families, have dedicated lines to the federal marketplace and report no significant wait times. They can facilitate three-way calls if required, ensuring a smoother experience for consumers.

The challenge of unauthorized plan switches is not new, but it gained momentum during the last enrollment season. Brokers argue that easy access to ACA information enables rogue agents to exploit the system, requiring only basic personal details from consumers. Although the CMS has tightened access through the three-way call requirement, some advocate for stronger measures, such as two-factor authentication for added security.

Unauthorized switches can have far-reaching consequences for consumers, leading to unexpected deductibles and tax issues when policies come with unqualified premium credits. The Biden administration has faced scrutiny over these fraudulent practices, as lawmakers demand increased oversight and enforcement against rogue agents.

As promising reductions in complaints are reported, with a 90% decrease in cases where agents switched consumer names, the suspension of 850 agents has sparked debate. Some industry groups argue against the lack of due process in determining suspensions, fearing that accusations may unfoundedly tarnish reputations within the field.

“There will be a certain number of agents and brokers who are going to be suspended without due process,” Nolan expressed, stressing the need for increased protections and more effective security measures to combat unauthorized switching. “They are just throwing things against the wall to see what sticks,” she added, suggesting that a more standardized approach, like two-factor authentication, could streamline the process and enhance security further.

Despite inquiries regarding the selection criteria for the suspended agents, the CMS has not provided specific details. The ongoing efforts reflect a significant initiative to safeguard the integrity of ACA enrollments amidst rising concerns over fraud.