Key Areas of the Proposed Rule

1. Program Updates and Objectives

The proposed rule aims to revise regulations to:

• Improve access and quality of care
• Modernize benefits and plan operations
• Strengthen plan accountability
• Align Part D operations with recent statutory changes
• Reduce administrative burden through regulatory streamlining

2. Proposed Changes to Star Ratings

Star Ratings remain an important quality measurement tool in Medicare Advantage and Part D. The 2027 proposed rule includes several updates:

• CMS proposes to continue use of the historical reward factor instead of implementing the previously planned Excellent Health Outcomes for All reward.
• The rule would remove 12 measures across MA-PD, MA-only, and Part D plans, focusing the system on measures that reflect clinical outcomes and consumer decision-making.
• CMS proposes adding a new depression screening and follow-up measure for Medicare Advantage (Part C). Data collection would begin in measurement year 2027, with integration into Star Ratings beginning in 2029.

These changes shift emphasis toward clinical care, health outcomes, preventive services, and patient experience.

3. Enrollment and Special Enrollment Period (SEP) Proposals

Key SEP-related proposals include:

• Enhancement of existing SEP for beneficiaries whose provider leaves a plan’s network, enabling plan changes when continuity of care is disrupted.
• Codification of existing SEP policies to provide more consistency and predictability for beneficiaries and plans.

4. Part D Updates and Inflation Reduction Act Alignment

The proposed rule incorporates and formalizes multiple Part D provisions from the Inflation Reduction Act of 2022, including:

• Elimination of the Part D coverage gap
• Reduction of the annual out-of-pocket threshold
• Removal of cost sharing in the catastrophic coverage phase
• Updated rules for True Out-of-Pocket (TrOOP) cost calculations
• Clarifications for specialty-tier drugs, reinsurance payments, and subsidy structures
• Amendments to Special Supplemental Benefits for the Chronically Ill (SSBCI) to prohibit coverage of cannabis products that are illegal under federal or state law

5. Reducing Regulatory and Administrative Burden

Consistent with Executive Order 14192, CMS proposes several updates intended to reduce outdated or redundant regulatory requirements, including:

• Exemptions for certain account-based plans from specific disclosure requirements
• Removal of the requirement for plans to issue mid-year notices regarding unused supplemental benefits
• Elimination of specific health equity-related requirements within MA quality improvement programs
• Removal of requirements for Utilization Management committees to include a designated health equity expert

6. Proposed Changes to Marketing, Communications, TPMO Requirements, and Scope of Appointment Rules

The Contract Year 2027 Proposed Rule includes updates to Medicare Advantage and Part D marketing and communications regulations. These proposals address Scope of Appointment (SOA) requirements, event-related rules, Third-Party Marketing Organization (TPMO) oversight, call-recording retention, and the use of marketing superlatives.

Revisions to Scope of Appointment (SOA) Requirements

The rule would eliminate the current 48-hour waiting period between completing an SOA and holding a personal marketing appointment. An SOA would still be required, but it would only need to be completed prior to the marketing appointment. Other SOA requirements remain unchanged.

The proposal also removes the prohibition on collecting an SOA during an educational event. Agents and brokers would be permitted to obtain SOAs at educational events as long as all other rules governing educational and marketing activities are observed.

Changes to Educational and Marketing Event Requirements

The proposed rule would eliminate the mandatory 12-hour waiting period between an educational event and a subsequent marketing event at the same location. A marketing event could follow immediately if beneficiaries are clearly informed that the educational event has concluded and that a marketing event is beginning, and if attendees are provided an opportunity to leave before marketing activities start.

TPMO Oversight and Related Requirements

Key changes affecting Third-Party Marketing Organizations include:

• Retention of the standardized TPMO disclaimer, with updated language specifying the number of organizations and plans represented
• Continued requirement to provide the TPMO disclaimer verbally during sales calls before discussing plan benefits
• Reduction of the required retention period for marketing and sales call recordings from 10 years to 6 years; enrollment-related records remain subject to a 10-year retention requirement
• A request for stakeholder input on potential future revisions to the TPMO definition and oversight structure

Use of Superlatives in Marketing Materials

The proposed rule removes the explicit prohibition on superlatives such as “best” or “most” in marketing materials. These terms would no longer require immediate substantiation within the marketing piece. However, all marketing content must continue to comply with CMS’s prohibition on misleading, confusing, or materially inaccurate information, and supporting documentation would need to be maintained and provided to CMS upon request.

Other Marketing and Communications Provisions

Additional proposals include updates related to translation and language-access rules, potential adjustments to requirements involving the use of Medicare card imagery, and requests for information on outbound enrollment verification, testimonials, and other disclosure requirements.

For insurance agents supporting Medicare beneficiaries, these proposals introduce updates that may influence plan comparisons, appointment preparation, and overall compliance processes.

Potential benefits for agents and beneficiaries include:

• Simplified appointment preparation due to the removal of the 48-hour SOA requirement
• More flexibility around educational and marketing events
• Reduced the duration for retaining marketing and sales call recordings
• Streamlined marketing material development given the removal of superlative restrictions

Potential challenges may include:

• Adjustments to updated TPMO disclaimer language and oversight requirements
• Ensuring accuracy and compliance when using superlatives in marketing materials
• Maintaining updated processes to reflect new SOA timing and event-related requirements
• Preparing for possible future changes if CMS modifies TPMO definitions after completing its RFI process

As CMS finalizes the 2027 rule, agents and beneficiaries may see further clarifications that refine marketing, enrollment, and compliance standards across the Medicare Advantage and Part D programs.