Medicare Program; Contract Year 2027 and Certain Contract Year 2026 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, and Medicare Cost Plan Program

CMS regulations at Sec. 423.566 specify that each Part D plan sponsor must have a procedure for making timely coverage determinations regarding the prescription drug benefits an enrollee is entitled to receive under the plan and the amount, including cost sharing, if any, that the enrollee is required to pay for a drug. In addition to a standard procedure for making such determinations, it must also have an expedited procedure for situations in which applying the standard procedure may seriously jeopardize the enrollee's life, health, or ability to regain maximum function, in accordance with Sec. 423.570. When a Part D plan sponsor requires a drug to be reviewed for coverage under Part D, there is coordination between the Part D plan sponsor and another entity, such as the prescriber, pharmacy, enrollee, or enrollee representative, to ensure that the drug meets the criteria for coverage prior to accepting the claim for payment under the Part D benefit.

Coverage determinations can be requested by the Part D enrollee, the enrollee's representative, or the prescriber on behalf of the enrollee. Current regulations at Sec. 423.566(b) outline the actions that are considered Part D coverage determinations, such as a decision not to provide or pay for a Part D drug, including a decision not to pay because the drug is not on the plan's formulary, the drug is determined not to be medically necessary, the drug is furnished by an out-of-network pharmacy, or the Part D plan sponsor determines that the drug is otherwise excludable under section 1862(a) of the Act if applied to Medicare Part D.

A POS claim adjudication occurs when a claim is submitted by a pharmacy for payment after the presentation of a valid prescription, regardless of whether the Part D plan sponsor treats the POS transaction as a coverage determination. In general, Part D plan sponsors do not treat POS claim adjudications as coverage determinations.\46\ However, Part D plan sponsors may implement utilization management edits in various situations to determine a drug's coverage at the POS. In such cases, the Part D sponsor may or may not choose to treat the POS claim adjudication as a coverage determination, leading to variance among plan sponsors. One reason a Part D plan sponsor might require a coverage determination or POS claim adjudication edit is to verify a drug's coverage under the Part D benefit. For example, Part D plan sponsors can use prior authorization for drugs with the highest likelihood of non-Part D covered uses, such as when coverage is available under Part A or Part B (versus D) for the drug as prescribed and dispensed or administered, or when the drug is not used for a medically accepted indication (MAI).\47\

\46\ Parts C & D Enrollee Grievances, Organization/Coverage Determinations, and Appeals Guidance, Section 40.2 (found at https://www.cms.gov/Medicare/Appeals-and-Grievances/MMCAG/Downloads/Parts-C-and-D-Enrollee-Grievances-Organization-Coverage-Determinations-and-Appeals-Guidance.pdf).

\47\ Medicare Prescription Drug Benefit Manual, Chapter 6--Part D Drugs and Formulary Requirements, Section 30.2.2.3 (found at https://www.cms.gov/Medicare/Prescription-Drug-Coverage/ PrescriptionDrugCovContra/Downloads/Part-D-Benefits-Manual-Chapter- 6.pdf).

Depending on the drug, Part D plan sponsors vary the scope of review when determining coverage or conducting a POS claim adjudication that determines coverage, and therefore, CMS must be able to review the plan sponsors' original documentation to ensure that a Part D plan sponsor asked relevant questions and received appropriate responses for the drug being reviewed. For example, in the instance of reviewing a drug for an MAI, the Part D plan sponsor needs to verify the diagnosis that led to the drug being prescribed to ensure that it is being prescribed and dispensed for an MAI and is eligible for coverage under Part D. 2. Audits of Part D Program Integrity Prescription Drug Event Records

Under section 1860D-12(b)(3)(C) of the Act and 42 CFR 423.505(d)- (e), Part D plan sponsors are required to maintain certain categories of documentation for specified periods of time. Specifically, Sec. 423.505(d) requires that the contract between a Part D plan sponsor and CMS include an agreement by the Part D plan sponsor to maintain books, records, documents, and other evidence of accounting procedures and practices for 10 years that are sufficient to meet certain requirements, including enabling CMS to evaluate the quality, appropriateness, and timeliness of services performed under the contract and to audit the services performed or determinations of amounts payable under the contract. In addition, Sec. 423.505(e) requires that Part D plan sponsors agree to allow HHS, the Comptroller General or their designee to evaluate through audit, inspection, or other means (1) the quality, appropriateness, and timeliness of those services furnished to Medicare enrollees; (2) compliance with CMS requirements for maintaining the privacy and security of protected health information and other personally identifiable information of Medicare enrollees; (3) facilities of the Part D sponsor; and (4) enrollment/disenrollment records for the current contract period and 10 prior periods. Furthermore, Sec. Sec. 423.568(a)(3), 423.570(c)(2), and 423.584(c)(1) outline requirements for Part D plan sponsors to establish and maintain a method of documenting and to retain documentation for oral requests for coverage determinations under standard timeframes, expedited timeframes, and redeterminations respectively.

Although the statute and current regulatory requirements address documentation maintenance and availability, these requirements do not detail the documentation needed to be maintained to support the appropriateness of a Part D coverage determination or POS claim adjudication that is used to determine coverage under the Part D benefit. The availability of complete and accurate documentation in its original format (for example, fax, call notes, electronic PA), is a key component of ensuring that taxpayer dollars are spent appropriately in the Part D program. Through CMS's Part D program integrity prescription drug event (PDE) record review audits, we have observed a large degree of variation among the documentation that Part D plan sponsors maintain when conducting coverage determinations, including prior authorizations, and POS claim adjudication edits, used to determine a drug's coverage under Part D, and subsequently provide to CMS upon audit. While some Part D plan sponsors have robust documentation standards that outline the information the Part D plan sponsor obtained that led to coverage under the Part D benefit, others provide or maintain little to no documentation. In some instances, plan sponsors maintain a summary of the original coverage request or refer to a past coverage determination to extend an authorization. In these instances, CMS is unable, upon audit, to review the original documentation to ensure that the information obtained was accurate. For CMS to provide proper oversight of the Part D program and the approvals made for drugs covered under the Part D benefit, it is imperative that Part D plan sponsors provide and maintain original documentation that describes how and why the Part D plan sponsor approved a drug for coverage. Without sufficient documentation, CMS cannot fully review, during an audit or educational analyses, or other program integrity efforts, Part D plan sponsor coverage determinations and POS claim adjudications for accuracy. The standardization and availability of sufficient documentation to support a drug's coverage under the Part D benefit will allow CMS to conduct more effective audits and help ensure CMS can verify that a drug was accurately paid under Part D. 3. Provisions

We proposed standardized, detailed documentation requirements for coverage determinations and POS claim adjudications, used for purposes of determining coverage under the Part D benefit. We proposed documentation requirements that include but are not limited to certain written, verbal, and electronic communications, such as the date and time the request was received; the name and title of the individual who submitted or verified the request; and the information used to make the coverage determination. These requirements would not apply to POS claim adjudications for purposes that are unrelated to the determination of coverage under the Part D benefit or the correct Medicare benefit for coverage,

such as those POS claim adjudications for safety, dose limitations, and quantity limits. Any additional documentation recorded or maintained will be subject to existing protected health information (PHI) and personally identifiable information (PII) rules and regulations.

Specifically, we proposed the following revisions to the documentation requirements:

First, to revise Sec. 423.505(d)(1) to add new paragraph (vi) to enable CMS to review original format documentation or information from all written, electronic, and verbal communications between the pharmacist, prescriber, enrollee, or other relevant stakeholders, in addition to what is included on the pharmacy claim, that is relied upon by the Part D plan sponsor to make a coverage determination or otherwise permit a point-of-sale claim adjudication that determines a drug's coverage under the Part D benefit. In instances when a coverage determination is extended, the original coverage determination must be maintained as documentation. The documentation covered by these standards must be made available to CMS during Part D program integrity prescription drug event (PDE) record review audits. Failure to produce this documentation will result in an improper Part D audit determination and will be subject to PDE record deletion in accordance with Sec. 423.325(a)(2).

Second, to revise Sec. 423.505 to add the following new paragraphs:

++ Paragraph (d)(2)(xiii) to include all documentation or information from all written, electronic, and verbal communications between the pharmacist, prescriber, enrollee, or other relevant stakeholders, in addition to what is included on the pharmacy claim, that is relied upon when a Part D plan sponsor makes a coverage determination or otherwise permit a point-of-sale claim adjudication that determines coverage of a drug under the Part D benefit, consistent with paragraph (d)(1)(vi). This includes:

++ Paragraph (d)(2)(xiii)(A) to include the date and time the request for a coverage determination or point-of-sale claim adjudication was received and the identity of the individual who submitted the request.

++ Paragraph (d)(2)(xiii)(B) to include the name and title (as applicable) of the individual the Part D plan sponsor contacted to verify the request (for example, pharmacist, prescriber, enrollee, or enrollee representative).

++ Paragraph (d)(2)(xiii)(C) to include information obtained, including the questions asked and the responses received, and the final decision rendered.

++ Paragraph (d)(2)(xiii)(D) to include the diagnosis code for a coverage determination or point-of-sale claim adjudication used to support a medically accepted indication.

++ Paragraph (d)(2)(xiii)(E) to include any additional information that the Part D plan sponsor utilized to determine the final outcome of the coverage determination or point-of-sale claim adjudication request.

Third, to revise Sec. 423.505(e)(2) to add a phrase to reference the requirement to make available the records containing information used to make the coverage determination or POS claim adjudication.

We received public comments on these provisions in the proposed rule. The following is a summary of the comments we received and our responses.

Comment: Numerous commenters were in support of the proposed provision to require standard documentation for coverage determinations and POS edits that determine coverage. Of note, commenters acknowledged this was critical to effective auditing, promoting compliance, improving consistency, enhancing beneficiary understanding of coverage, reducing administrative burden, and enhancing program integrity. One commenter also expressed support for the provision as it levels the playing field for smaller health plans and increases transparency for health plans that are vertically integrated. In addition, a few commenters noted that they are in support of documentation standards as long as they avoid duplicative and prescriptive requirements, and one commenter suggested providing documentation templates.

Response: CMS appreciates commenters' support on its efforts to strengthen program integrity. It is CMS's intention to standardize documentation standards for all Part D plan sponsors to ensure proper oversight of the program while not increasing burden for plan sponsors. CMS understands the commenter request for documentation templates; however, given the vast array of systems and flexibilities for plan sponsors and the varying information needed for different requests, CMS cannot create one singular template that would be applicable universally.

Comment: A few commenters requested clarification on the meaning and intent of “original format documentation,” particularly as it pertained to audio recordings. Commenters expressed concern for the administrative and financial burden of maintaining audio recordings, especially on small health plans. Another commenter requested examples of original format documentation and if call notes or transcripts would suffice. It was further recommended that retention of transcripts be permitted in lieu of recordings. A few commenters suggested it would create a great burden especially for plan sponsors to obtain communications between pharmacists, prescribers, enrollees, or other stakeholders that plan sponsors do not currently collect or have direct access to, such as pharmacies that cannot transmit their internal call notes to plans. One commenter recommended that CMS clarify if scanned or digitized copies of documents are considered original records for purposes of compliance.

In addition, a commenter expressed concern that this requirement may read as retention beyond the 10-year standard, effectively increasing costs, annual coverage determinations and burden. It was noted by another commenter that CMS already can request the original coverage determination documentation during audit and that no new documentation requirement is needed.

Another commenter supported the requirement for plan sponsors to maintain original format documentation.

Response: CMS understands the commenters' concerns and requests for clarification surrounding “original format documentation.” In regard to audio recordings, we do not expect the retention of the actual audio recording; a transcript or call note(s) of the call will be sufficient documentation. The maintenance of transcripts or call notes should not increase burden on plan sponsors because this information should already be maintained. However, the information in a transcript or call note(s) of an audio recording must include sufficient information to allow CMS to fully evaluate the appropriateness of coverage under the Part D program in accordance with Sec. 423.505(d)(ii). Additionally, a scanned or digitized copy of a request will be considered original format documentation.

Regarding the comments about obtaining communications between pharmacists, prescribers, enrollees, or other stakeholders and the worry that plan sponsors do not have access to those calls or communications, CMS agrees with the commenters' concerns and did not intend to suggest that those communications be collected. Rather, the proposed provisions related to

expectations of Part D plan sponsors, including that plan sponsors maintain communications that they have with these different entities, not communications that those entities have with one another. CMS is therefore modifying the language of the proposed rule to clarify that the communications that must be maintained are between the plan sponsor and those entities.

Plan sponsors must have documentation to support Part D coverage determinations and POS edits that determine coverage, including when an authorization is reauthorized for an extended period or original approved for a timeframe greater than 10 years. If the authorization is still ongoing, documentation must be available to support it.

CMS agrees that original coverage determination documentation is already expected upon audit; however, we disagree with the commenter that no new documentation standards are necessary. As stated in the proposed rule, the documentation CMS receives during an audit varies greatly among plan sponsors. An example would be a call note stating “approved Part D” instead of documentation reflecting the questions asked and answers provided during the call. For this reason, CMS believes it is imperative to establish standards for strengthening oversight and ensuring all plan sponsors are being held to the same standards.

Comment: A few commenters requested clarification on what is meant by both the “entity who submitted the request” and the “name and title (as applicable) of the individual the Part D plan sponsor contacted to verify the request,” including what is meant by “verify the request.” One commenter questioned how the name and title of the requester applied to a POS claim. A few commenters requested that CMS clarify the expectation for handling requests when information is unavailable to the plan sponsor, including the expectation for documenting the name and title of an individual when additional information is not required to verify a request. It was also noted that plan sponsors, especially PDPs, do not have contracts with the providers and cannot enforce the information being provided. A commenter also questioned the ability of plan sponsors to obtain this information, especially from large provider groups. Additionally, a commenter noted that these requirements will extend adjudication processing time to ensure documentation retrospectively while not providing any real-time clinical decision-making benefit, while another noted that the requirements proposed goes far beyond what is reasonable or necessary for effective program oversight.

A few commenters expressed concern over providing the information CMS proposed to require, as the NCPDP standard for coverage determinations does not allow for the collection of this information. A commenter noted that plan sponsors often have no mechanism to capture this information, especially the identity of the individual submitting the pharmacy claim and verbal discussions between the prescriber, pharmacist and patient. Another commenter noted that plans are prohibited from requiring submission(s) on a specific form and must accept any format.

Another commenter supported the requirement to document the identity and title of the individual submitting a coverage determination or POS request, as well as the individual contacted to verify it as it establishes accountability, improves the accuracy and efficiency of follow-up when documentation is incomplete or inconsistent, enables identification of aberrant or high-risk submission patterns, and supports CMS's ability to validate that drugs were paid for medically accepted indications (MAIs).

Response: The “entity who submitted a request” refers to the person who submitted the coverage determination request. CMS's Part C & D Enrollee Grievances, Organization/Coverage Determinations, and Appeals Guidance \48\ states that an individual or entity authorized to request a coverage determination include: (1) enrollee, (2) enrollee's appointed representative, (3) prescribing physician or other prescriber, or (4) any individual representative authorized under state or other applicable law. This information is important to CMS for determining that an appropriate entity requested the coverage determination and allows CMS to monitor for potential fraud, waste, and abuse in instances where an entity is requesting determinations on their own behalf to increase utilization and payment.

\48\ Parts C & D Enrollee Grievances, Organization/Coverage Determinations, and Appeals Guidance, (found at https://www.cms.gov/Medicare/Appeals-and-Grievances/MMCAG/Downloads/Parts-C-and-D-Enrollee-Grievances-Organization-Coverage-Determinations-and-Appeals-Guidance.pdf).

In regard to the “name and title (as applicable) of the individual the Part D plan sponsor contacted to verify the request,” CMS is referring to those situations in which plan sponsors conduct further follow up with an individual or entity to clarify a coverage determination. For example, in the case of conflicting or missing information needed to approve coverage, CMS would want to ensure that the individual contacted would be able to provide the information necessary to determine coverage. For instance, a beneficiary may not have the necessary information to determine if a drug or service was covered by Medicare. CMS believes this information is still relevant, when available, for a POS edit that determines coverage. In accordance with the Prescription Drug Benefit Manual (PDBM), a plan sponsor that approves or denies a drug through application of a POS edit has made a coverage determination and is subject to all applicable coverage determination standards, timelines, and requirements. As such, plan sponsors maintain some level of information or automation that allowed the POS edit to make an appropriate coverage determination. In these instances, CMS would expect to see what in their system determined that the drug was covered under the Part D program and make that information available to CMS upon audit.

However, CMS does understand that this information may not be available in all instances and/or may be unobtainable by the plan sponsors within authorization timeframes due to a variety of reasons, such as unresponsive entities or format of the coverage determination, including the NCPDP standard. CMS did not intend to require plan sponsors to reject a claim based on the lack of this information, but to include it when reasonable and obtainable. CMS does not expect plan sponsors to perform additional outreach if the information available to the plan sponsor clearly illustrates how a decision for Part D coverage was made.

Based on the comments received, CMS is modifying the proposed regulatory text to make it clear for plan sponsors that the identity of the individual requiring the coverage determination be provided when available. CMS already had proposed “as applicable” language for the name and title of the individual the plan contacted to verify the request, but is modifying the proposed language to better clarify that the identity of the individual the plan contacted to verify the request refers to who was contacted in instances when additional information is needed to complete a request.

Comment: A few commenters questioned the need for a diagnosis code to establish a MAI, as this information is captured in different manners, such as ICD-10 codes, provider attestations and medical record review. Other

commenters questioned if widespread Part D coverage of drugs is a significant driver of improper payments, especially in cancer treatments and questioned if gathering the MAI at the POS is warranted given risks of imperfect, insufficient, or delayed coding especially in oncology and ultra rare disease. A commenter suggested that CMS clarify how a plan sponsor should adjudicate and document coverage determinations, including when both coverable and non-coverable diagnoses are listed and clarification cannot be obtained within adjudication timeframes.

Response: CMS appreciates the commenters' discussion on the requirement to provide a diagnosis code for coverage determinations reviewing for a MAI. CMS agrees that a diagnosis code itself may be limiting in some instances as suggested by commenters in oncology or rare disease, and CMS is modifying the language in the proposed rule to remove the terminology “code.” This will provide the plan sponsors with flexibility in instances where the diagnosis is provided by ICD-10 code, prescriber attestations, or medical records.

CMS does expect plan sponsors to ensure that drugs are only covered under the Medicare Part D program when they are prescribed and dispensed or administered for an MAI in accordance with the section 1860D-(2)(e)(4) of the Act. CMS does recognize that not all drugs can be monitored for MAI at the POS, specifically as it relates to routine drugs. However, plan sponsors do make formulary decisions for their organization as it relates to coverage determinations, such as prior authorization, for drugs that have a high likelihood of being utilized for a non-MAI. In these instances, CMS expects that plan sponsors document a diagnosis used by the plan sponsor in making a coverage determination under the Part D benefit. In instances where there is conflicting information, CMS expects plan sponsors to make a reasonable determination within the adjudication timeframes but notes that plan sponsors should retrospectively be getting clarification to ensure proper coverage for the drug.

Under the rule as proposed, plan sponsors would be required to supply a diagnosis on any coverage determination or POS edit that determines coverage for only those coverage determinations reviewing a drug for a MAI. Based on the commenters' feedback, CMS is modifying the proposed language to clarify and be more explicit that the requirement for a diagnosis is only for those reviews of a MAI.

Comment: A commenter noted that plan sponsors may feel compelled to require a diagnosis on all prescriptions for a likelihood of non-Part D covered uses, even though CMS does not explicitly propose this. The commenter further noted that prescribers are not required to include diagnosis codes on all scripts and NCPDP standards do not require pharmacies to submit them.

Additionally, a commenter noted that CMS should establish that coverage determinations made via ePA transactions conforming to adopted standards (for example, NCPDP SCRIPT or successor standards) are compliant with documentation requirements when the structured transaction data is retained, as this includes clinical criteria responses, attestations, and decision outcomes.

Response: CMS agrees with the commenter that requiring a diagnosis on all prescriptions was not proposed by CMS and is, therefore, outside the scope of this provision.

Further, CMS disagrees with the commenter that CMS should establish that coverage determinations made via an adopted standard are compliant with the documentation standards. CMS recognizes that different authorizations require different information, and CMS cannot state that any one standard will fulfill all requirements of all request types.

Comment: A commenter supported CMS's proposal for standardization but suggested that CMS coordinate audit methodologies and create standard requirements and protocols across Centers for consistency, to minimize duplication and improve understanding and compliance. The commenter noted that the proposal only affects CMS Part D Self-Audits, which would cause misalignment between auditing programs and increase burden. It was also noted by a commenter that currently, plan sponsors are not told why a PDE failed and not offered the opportunity to rebut, which is inconsistent with other program audits in CMS. A few commenters questioned the interplay between CMS's expectations for plan sponsors to approve coverage determinations timely and utilize information available while also expecting detailed documentation retrospectively.

Response: CMS thanks the commenters for their feedback. CMS currently coordinates internally on upcoming audits and methodologies. CMS will continue to work internally to enhance program auditing by reducing any audit duplication, minimizing burden for plan sponsors, and creating consistency when able. CMS also clarifies that these requirements would apply to any program integrity PDE record review audit, which currently would include CMS's Part D Self-Audits and National Audits. CMS believes that these proposed standards will streamline auditing and ultimately make it easier for plan sponsors to provide case files upon audit, as well as create consistency across plan sponsors. CMS appreciates the commenters' concern for the current audit methodology in which plan sponsors are not provided why a specific PDE record failed and subsequently no mechanism to appeal. The audit methodology, including determination rationale, is not a part of this rule and is outside the scope of this specific provision; however, CMS will take this comment into consideration for audit enhancements.

In addition, CMS notes that it proposed to create a mechanism for appeal elsewhere in the proposed rule, which is being finalized at 42 CFR part 423 subpart Z (90 FR 54962). CMS also recognizes that plan sponsors have expectations to approve or deny determinations within adjudication timeframes set by CMS using the best available information. However, if a plan sponsor utilizes the best information available and knows that information was missing or conflicting, plan sponsors should be retrospectively performing outreach to ensure appropriate coverage of its drugs, items or services.

Comment: Several commenters supported the proposed documentation standards but noted that CMS's formulary oversight lacks transparency. Of note, stakeholders have limited insight into how CMS evaluates submissions and utilization management criteria. Specific criteria to increase transparency were recommended including quarterly or annual summaries of Part D formulary review, structured process for stakeholder input, standardized reporting and transparency for a variety of indicators such as coverage determinations by drug category, approval and denial rates, average turnaround times and the clinical criteria applied, and auditing to identify patterns of inappropriate denials and denial appeals.

Response: CMS thanks the commenters for their concerns over CMS's formulary oversight; however, that subject is outside the scope of the proposed provisions.

Comment: A few commenters noted that there is no differentiation between coverage determinations and POS

determinations. One commenter expressed that POS decisions are not coverage determinations and should be exempted from the more extensive documentation CMS is proposing, as at the pharmacy level it could disrupt efficient real-time coverage authorization processes.

Response: CMS agrees with the commenters that not all POS decisions are coverage determinations, such as those triggered based on an approved formulary criteria such as quantity limits. However, in accordance with the PDBM, a plan sponsor that approves or denies a drug through application of a POS edit has made a coverage determination and is subject to all applicable coverage determination standards, timelines, and requirements. As such, plan sponsors maintain some level of information or automation that allowed the POS edit to make an appropriate coverage determination. In these instances, CMS would expect to see what in their system determined that the drug was covered under the Part D program and make that information available to CMS upon audit. For these reasons, CMS proposed that only coverage determination and those POS edits utilized to determine coverage are subject to these requirements.

Comment: A few commenters expressed concerns over the implications for pharmacies and pharmacists. It was noted that pharmacists work in fast-paced environments and verbal exchanges are not recorded, and therefore, mandating capture would disrupt workflow, reduce patient care time, and add administrative burden. A commenter suggests that CMS ensure Part D plan sponsors are solely responsible for recording these interactions.

Response: CMS clarifies that pharmacists and pharmacies are not subject to the requirements proposed at Sec. 423.505 and would not be held accountable for capturing exchanges with the plan sponsors. The requirements proposed are applicable to the plan sponsors contracted by CMS and subject to the requirements at Sec. 423.505.

Comment: A few commenters expressed concern over PDE records, upon audit, being subject to deletion for not having all information documented and the implications it could have on timely decision making, conflicting with CMS's beneficiary-first approach to coverage determinations. It was noted that plan sponsors may hesitate to approve coverage for high-cost drugs, impose stricter internal evidence requirements than medically necessary, or require additional documentation slowing access. Another commenter expressed that the requirement to maintain “any additional information that the Part D plan sponsor utilized to determine the final outcome of the coverage determination or point-of-sale claim adjudication request” is broad and unclear especially when tied to PDE record deletion upon audit. Commenters recommended that CMS provide alternative oversight approaches that leverage existing documentation requirements and improved audit methodologies. Alternatively, another commenter recommended that CMS soften the terminology from “will” to “may” in regard to marking a PDE record as improper.

Response: CMS, through previous comment responses, clarifies that not all information in the documentation standards is required for every coverage determination and POS edit that determines coverage. For CMS to provide oversight and ensure that plan sponsors are meeting their requirements to only provide coverage for Part D when it meets the definition of a Part D drug, CMS must be able to review the information utilized by the plan sponsor. When not documented sufficiently, CMS is unable to determine that it was appropriately covered under Medicare Part D, which may lead to an audit finding that the PDE was improper. CMS has modified the proposed regulatory text to clarify that not all requirements are expected for every determination, as not every determination is evaluating the same criteria. The language modifications clarify that some requirements are only necessary when applicable or available, while others like the questions asked and responses received that led to coverage under Part D are required for documentation to be considered sufficient for CMS to evaluate appropriateness. Therefore, documentation provided to CMS upon audit that does not contain each proposed requirement will not automatically mean that a PDE records is deemed improper.

Comment: A commenter recommended that CMS adopt an audit approach to focus on enhanced documentation review on coverage determinations with elevated program integrity risk, drugs with Part B/D coverage, or drugs with unknown fraud or abuse patterns. It was noted that this approach targets resources without imposing uniform burden across all coverage determinations. Another commenter suggested adopting a risk- based audit approach, where plans with strong compliance histories or those in the upper performance quartile are audited less frequently.

Response: CMS clarifies that the program integrity PDE record review audits currently focus on enhanced documentation review for coverage determinations and POS edits that determine coverage, specifically for drugs, items, or services that have a high likelihood that, (1) coverage is available under Parts A or B, (2) the drug is excluded from coverage or otherwise restricted under Part D, or (3) the drug is used for non-medically accepted indications

Comment: A commenter expressed that these requirements may slow prior authorization and coverage determination processes that are in opposition to CMS's efforts to streamline administrative requirements. It was suggested that these requirements could hinder the industry's progress toward automation and electronic prior authorization and could unintentionally undermine both beneficiary access and the modernization goals shared by CMS and plan sponsors. It was recommended that CMS consider not finalizing the proposed documentation language and instead work with plans to develop documentation standards that support program integrity without creating operational inefficiencies or impeding automation efforts.

Response: CMS thanks the commenter for the suggestions. CMS's intent is not to change the current process for prior authorization and coverage determinations, but rather to have the plan sponsors document the information they are already collecting to determine coverage under Medicare Part D when approving coverage determinations or POS edits that determine coverage. CMS is modifying the proposed language to clarify not all information is required in all situations to address concerns about increasing administrative burden to gather the information proposed.

Comment: Several commenters opposed CMS's provision to standardize documentation requirements. Overall concerns expressed pertain to unintended consequences for beneficiary access, increased administrative burdens, and financial risk.

Response: CMS thanks the commenters for sharing their concerns regarding the proposed provisions. Many of the specific concerns voiced by these commenters that led to the consequences of beneficiary access, increased administrative burdens, and financial risk were addressed in other comments. CMS believes that modifications to the regulatory language

proposed will mitigate many of the commenters' concerns. For example, adding that some of the requirements are “as applicable” allows plan sponsors discretion in the documentation required based on the specific evaluation criteria for each coverage determination and when the information is not obtainable due to outreach going unanswered. CMS does not expect plan sponsors to do additional outreach for coverage determinations but does expect plan sponsors to provide sufficient and clear documentation that shows how a coverage determination or POS edit that determines coverage led to Medicare Part D approval. CMS believes the burden is minimal and the benefits of program oversight and beneficiary safety vastly outweigh the perceived burden by plan sponsors.

After consideration of the public comments we received, we are finalizing the proposal as modified.

D. Updating Third-Party Marketing Organizations (TPMO) Disclaimer Requirements (Sec. Sec. 422.2267 and 423.2267)

As a part of the Medicare Program; Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Programs; Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency; Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency Final Rule which appeared in the Federal Register on May 9, 2022 (hereafter referred to as the May 2022 final rule) (87 FR 27704), as a part of a broader effort to address concerns with TPMOs, CMS finalized regulations at Sec. Sec. 422.2267(e)(41) and 423.2267(e)(41) to improve regulatory oversight of Third-Party Marketing Organizations (TPMOs). One provision required Medicare Advantage (MA) organizations and Part D sponsors to ensure that the TPMOs, with whom MA organizations and Part D sponsors directly or indirectly do business, verbally convey a standardized disclaimer during sales calls with beneficiaries. CMS implemented these regulations after listening to TPMO-based sales calls and hearing first-hand beneficiary confusion about the information the TPMO was conveying and to help ensure that TPMOs were not marketing information in a misleading way that might lead beneficiaries to join a plan contrary to their intention, or a plan that did not best meet their health care needs. The disclaimer, as finalized, consisted of the following statement: “We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.” After these regulations were implemented, CMS continued to monitor TPMOs' interactions with beneficiaries during these sales calls. In CMS's review of hundreds of sales, marketing, and enrollment audio calls, CMS found that only one plan option from one MA organization was discussed in over 80 percent of the calls reviewed. These reviews also showed that TPMOs rarely, if ever, informed the beneficiary that there were multiple plans available in their service area. Although the TPMO may have researched other plans, the TPMO rarely communicated information about those plan options to the beneficiary; thus, the beneficiary may not have known about other available options. These monitoring efforts heightened CMS's concern that beneficiaries were not receiving comprehensive information about all their plan choices, thus limiting their ability to make an informed decision about the plan best able to meet their health care needs.

To address those concerns, CMS issued the Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program; and Programs of All-Inclusive Care for the Elderly Final Rule, hereinafter referred to as the April 2023 final rule (88 FR 22120). In this final rule, CMS amended Sec. Sec. 422.2267(e)(41) and 423.2267(e)(41) revising the existing disclaimer, which was applicable to TPMOs that represented more than one, but not all, MA organizations or Part D sponsors in a given service area, to notify the beneficiary about the number of organizations and the number of plans the organizations offered. Additionally, CMS revised Sec. Sec. 422.2267(e)(41) and 423.2267(e)(41) to include a new required disclaimer for TPMOs that contracted with every MA organization or Part D sponsor in a service area. Finally, CMS added State Health Insurance Assistance Programs (SHIPs) as a source of information for beneficiaries to both versions of the disclaimer and required TPMOs convey the applicable disclaimer within the first minute of a sales call, among other requirements for the TPMO to communicate the disclaimer through other electronic means or materials (as described under Sec. Sec. 422.2267(e)(41) and 423.2267(e)(41)).

In the April 2023 final rule, CMS addressed comments received in response to the proposed rule (88 FR 22120). Some industry stakeholders raised concerns about the new disclaimer requirements. For example, some asserted that requiring TPMOs to list all the plans with which they contract would confuse or distract beneficiaries; or for those TPMOs that represent many plans, the disclaimer would be too long to read within the first minute. Similarly, some stakeholders pointed out that budget constraints and limited training would hinder a SHIP's ability to effectively assist beneficiaries with plan choices. While CMS understood those concerns, given CMS's observations about common TPMO interactions with beneficiaries during the sales and enrollment calls previously described, the Agency determined that these regulatory changes were warranted.

CMS regularly reviews MA and Part D program requirements and how they affect Medicare beneficiaries and industry stakeholders. Based on CMS's review and industry feedback, CMS determined that additional changes to the TPMO disclaimer may be appropriate. CMS proposed to modify the TPMO disclaimer requirement in Sec. Sec. 422.2267(e)(41) and 423.2267(e)(41) to: (1) replace the existing requirement to read the disclaimer within the first minute of the call, so that TPMOs are instead required to read the disclaimer “prior to the discussion of any benefits” during the call, and to: (2) remove SHIPs as a source of information from the disclaimer. CMS has determined that requiring TPMOs to convey the disclaimer during the first minute of a sales call is not always the appropriate time to notify the beneficiary of the number of plan choices available. CMS believes that many calls typically begin with the TPMO obtaining basic demographic information from the beneficiary, which allows the TPMO to immediately determine if the call should proceed to the benefit discussion phase. In other instances, the TPMO may determine that the beneficiary does not have a valid election period, which would end the call, making the disclaimer unnecessary. Notifying the beneficiary of the number of plans that a TPMO represents in the first minute does not always promote clear communication with the beneficiary or mitigate beneficiary confusion. By permitting TPMOs to read the disclaimer at an appropriate point during the call, provided it is read prior to the discussion of any benefits, the disclaimer will fit in better with the flow of the conversation. CMS does not consider the mere mention of a benefit,

for example pointing out that nearly all MA organizations offer routine dental care, constitutes a discussion of benefits. Rather, CMS believes that discussing the specificity of a benefit with the intent to draw a beneficiary's attention to an MA or Part D plan(s), or to influence a beneficiary's decision-making process when making an MA or Part D plan selection, or to influence a beneficiary's decision to stay enrolled in a plan, could represent a discussion of benefits, as defined by the marketing definition under Sec. Sec. 422.2260 and 423.2260. This could include, for example, talking with a beneficiary about the benefits listed in a plan's Evidence of Coverage document, or how beneficiary out of pocket cost sharing might work given a plan's benefit structure and the beneficiary's previous health care experience or needs. If there is no discussion of benefits, CMS would not expect TPMOs to provide the disclaimer to beneficiaries. When proposing these changes, CMS solicited comment on how the Agency should identify when a “discussion of benefits” occurs.

In the Contract Year 2027 proposed rule, CMS only proposed changes to the TPMO disclaimer provision at Sec. Sec. 422.2267(e)(41)(ii) and 423.2267(e)(41)(ii). Thus, the proposal did not alter the existing requirements provided within Sec. Sec. 422.2267(e)(41)(i), (iii), (iv), and (v); and 423.2267(e)(41)(i), (iii), (iv), and (v). That is, any TPMO, as defined under Sec. Sec. 422.2260 and 423.2260, that sells plans on behalf of more than one MA organization or Part D sponsor, must electronically convey the TPMO disclaimer when communicating with a beneficiary through email, online chat, or other electronic means of communication, prominently display the disclaimer on TPMO websites, and include the disclaimer in any marketing materials, including print materials and television advertisements, developed, used or distributed by the TPMO.

CMS also proposed to remove SHIPs as a source of information from the disclaimer. CMS recognized that, while SHIPs can be a source of unbiased information about plan choices, informing beneficiaries on every sales call about the SHIP may cause additional issues for beneficiaries. SHIP volunteers may not always have the expertise to help beneficiaries navigate increasingly complex MA and Part D programs. CMS stated that beneficiaries enrolled in the MA and Part D programs may be more effectively served by information and entities for which CMS has direct oversight. CMS also recognized that each SHIP works differently and provides different training to its counselors, which can vary further at the local level. This can result in Medicare beneficiaries receiving different information based on the SHIP and SHIP counselor that is ultimately reached. CMS stated that, for the TPMO disclaimer, 1-800-MEDICARE is a better option to assist beneficiaries with health care choices.

1-800-MEDICARE has representatives available 24/7 to assist beneficiaries, provides standardized training to its customer service representatives, is centrally monitored and controlled by CMS, which facilitates efficient and consistent information sharing, and is a one- stop shop for all beneficiaries, regardless of the state in which they live.

In summary, and for reasons previously discussed, CMS proposed to revise introductory text in Sec. Sec. 422.2267(e)(41) and 423.2267(e)(41) to remove references to the SHIPs, while maintaining guidance for beneficiaries to contact Medicare.gov or 1-800-MEDICARE for plan advice. Additionally, CMS proposed to revise Sec. Sec. 422.2267(e)(41)(ii) and 423.2267(e)(41)(ii) to require TPMOs to provide the TPMO disclaimer during sales calls before engaging in discussions about benefits rather than requiring TPMOs to verbally convey the disclaimer during the first minute of a sales call.

CMS solicited comments on this proposal and appreciates stakeholders' input on the proposed changes. The Agency received the following comments and provided responses as follows:

Comment: CMS received several comments supporting the proposal to adjust the timing of when TPMOs are required to verbally convey the disclaimer during a call. A few commenters noted that the first minute of the sales call is not the most effective place to present the TPMO disclaimer. These commenters agreed that conveying the disclaimer before benefits are discussed ensures beneficiaries understand the role and affiliation of the marketing organization before receiving substantive information that could influence decision-making. Additionally, some commenters noted that relaxing the existing requirement for the disclaimer to be conveyed within the first minute of the call is a common-sense change that would retain important beneficiary safeguards and reduce confusion while preserving disclosure objectives.

Response: CMS thanks commenters for supporting this proposal.

Comment: CMS received several comments disagreeing with the proposal to adjust the timing of when TPMOs are required to verbally convey the disclaimer during a call. A commenter expressed concerns that delaying the disclaimer would permit TPMOs to harvest personal information from callers who would not share their information if they knew the limits of the plans the TPMO offers. Others were concerned that beneficiaries would not have immediate awareness of the scope of the conversation they are having before being lured into any kind of discussion about plan choices, and that beneficiaries largely do not understand how MA plans' networks work, so it is essential to immediately provide the disclaimer. A commenter also noted that maintaining the current requirement would maintain transparency and consistency in MA plan marketing.

Response: CMS appreciates the concerns raised by commenters. The Agency is committed to ensuring the protection of beneficiaries' personal data. However, CMS respectfully disagrees with the assertion that altering the requirements for when TPMOs verbally convey the disclaimer puts beneficiaries' personal information at risk. There are other data-focused beneficiary protections still in place to prevent the unauthorized sharing of beneficiary information, such as those found under Sec. Sec. 422.2274(g)(4) and 423.2274(g)(4) that prohibit personal beneficiary data collected by TPMOs for marketing or enrolling a beneficiary into an MA or Part D plan to be shared with other TPMOs, unless prior express written consent is given by the beneficiary.

CMS also disagrees that this change would diminish beneficiaries' understanding of the call's scope or impact transparency and consistency in MA plan marketing. As previously discussed in this preamble, CMS has determined that many calls typically begin with the TPMO obtaining basic demographic information from the beneficiary. As such, it is CMS' position that the change to the timing of the disclaimer will enhance the effectiveness of the disclaimer. The Agency also believes that conveying the disclaimer before a discussion of benefits occurs will promote clear communication with the beneficiary and mitigate beneficiary confusion. CMS does not anticipate that changing the timing of when the disclaimer is verbally conveyed will have a negative impact on the transparency and consistency of MA plan marketing.

Comment: CMS received several comments about how the Agency

should identify when a “discussion of benefits” occurs to mitigate any confusion over when the disclaimer should be read and to ensure consistency in interpretation. Commenters suggested that a “discussion of benefits” occurs when the specificity of benefits is being discussed with the intent to draw a beneficiary's attention to an MA or Part D plan or to influence a beneficiary's decision-making process, when discussing plan options, or whenever a TPMO representative begins to discuss unique benefits, premiums, or cost sharing of a particular MA or Part D plan. Another commenter urged CMS to align “discussion of benefits” with the current regulatory definition of marketing.

Response: CMS appreciates these recommendations. As previously discussed in this preamble, CMS believes that discussing the specificity of a benefit with the intent to draw a beneficiary's attention to an MA or Part D plan(s), to influence a beneficiary's decision-making process when making an MA or Part D plan selection, or to influence a beneficiary's decision to stay enrolled in a plan, could represent a discussion of benefits, consistent with the marketing definition under Sec. Sec. 422.2260 and 423.2260. This could include, for example, talking with a beneficiary about the benefits listed in a plan's Evidence of Coverage document, or how beneficiary out of pocket cost sharing might work given a plan's benefit structure and the beneficiary's previous health care experience or needs. Thus, the Agency agrees that a “discussion of benefits” can align with the definition of marketing in Sec. Sec. 422.2260 and 423.2260. Additionally, the examples previously provided establish a framework that agents and brokers can use to judge when the disclaimer should be read. In addition, as this final rule is implemented, CMS will continue to gauge industry's need for more examples or other means of operational guidance for these requirements.

Comment: CMS received numerous comments from stakeholders who submitted similar, and in some cases identical, comments regarding the TPMO disclaimer. The commenters asserted that the TPMO disclaimer, as currently framed, forces independent agents to make statements that are untrue and confuses beneficiaries. The comments included that the disclaimer operates under the flawed assumption that insurance agents, particularly independent ones, do not or cannot represent all plans available in a given area. The commenters further stated that it is common for experienced independent agents, especially in less saturated markets or those committed to extensive certifications, to represent every single plan available to a beneficiary. These commenters further urged CMS to eliminate the entire TPMO disclaimer requirement.

Response: CMS disagrees with the commenters' assertion that the disclaimer requires them to make statements that are untrue or confusing to the beneficiary. The current disclaimer already addresses the commenters' concerns and provides disclaimer language for instances where the agent offers all plans in a service area. Additionally, the TPMO disclaimer is currently designed to ensure that agents provide beneficiaries information about the scope of plans that they represent, inform beneficiaries that there are a variety of plans in their service area to consider when picking a plan, and provide beneficiaries with additional resources for information. The modifications to the current requirements in this final rule are a practical step in refining the rules around the disclaimer to alleviate TPMO burden without a negative impact to the beneficiary. While the elimination of the TPMO disclaimer was not proposed, and hence this comment is out of scope, CMS appreciates these commenters' input and will take it under advisement.

Comment: CMS received several comments strongly disagreeing with the proposal to remove SHIPs from the TPMO disclaimer. These commenters asserted that SHIPs are the only federally-funded source of independent, individual-level counseling available to Medicare beneficiaries and are a critical source of unbiased information for Medicare beneficiaries. Commenters also noted that 1-800-MEDICARE customer service representatives often refer to SHIPs because SHIPs have expertise in state programs, can meet with people in person, and provide a higher level of advocacy and assistance than 1-800-MEDICARE.

Response: CMS agrees that SHIPs can be a source of unbiased information about plan choices. For the purpose of the of the TPMO disclaimer, CMS prefers that TPMOs direct beneficiaries to 1-800- MEDICARE. As previously mentioned in this preamble, this is based on the fact that 1-800-MEDICARE has representatives available 24/7 to assist beneficiaries, provides standardized training to its customer service representatives, is centrally monitored and controlled by CMS, which facilitates efficient and consistent information-sharing, and is a one-stop shop for all beneficiaries, regardless of the state in which they live. When appropriate, 1-800-MEDICARE representatives may refer beneficiaries to their local SHIP.

Comment: Some commenters acknowledged the complexity of the MA and Part D programs and suggested that, instead of removing the SHIPs from the TPMO disclaimer, SHIPs should be provided with additional resources. Other commenters noted that increased support for SHIPs, both from a staffing and training perspective, and receiving similar training to 1-800-MEDICARE staff, could help SHIP volunteers better navigate the MA and Part D programs.

Response: While out of scope to this provision, CMS appreciates these comments and will take them under advisement.

After consideration of the public comments CMS received, CMS is finalizing as proposed revisions to the introductory text of Sec. Sec. 422.2267(e)(41) and 423.2267(e)(41) and revisions to Sec. Sec. 422.2267(e)(41)(ii) and 423.2267(e)(41)(ii).

E. Removing Rules on Time and Manner of Beneficiary Outreach (Sec. Sec. 422.2264, 423.2264, 422.2274, and 423.2274)

Section 1851(h) and (j) of the Act provides a structural framework for how Medicare Advantage (MA) organizations may market and communicate with beneficiaries and directs CMS to adopt standards related to prohibitions and limitations on marketing and communications activities. Section 1860D-1(b)(1)(B)(vi) of the Act directs that the Secretary use rules similar to and coordinated with the MA rules at section 1851(h) of the Act relating to approval of marketing material and application forms for Part D sponsors. Section 1860D-4(l) of the Act applies certain prohibitions under section 1851(h) of the Act to Part D sponsors in the same manner as such provisions apply to MA organizations (and agents, brokers, and other third parties representing MA organizations).

CMS has adopted regulations related to marketing and communications by MA organizations and Part D sponsors in 42 CFR part 422, subpart V, and 42 CFR part 423, subpart V; these regulations include the specific standards and prohibitions in the statute as well as standards and prohibitions promulgated under the statutory authority granted to the Agency. Additionally, under 42 CFR 417.428, most marketing and communications requirements in subpart V of part 422 also apply to section 1876 cost plans. CMS has long provided further interpretation and sub-regulatory

guidance for these regulations in the form of a manual titled, “Medicare Communications and Marketing Guidelines” (MCMG), previously known as “Medicare Marketing Guidelines.” Because this final rule is applicable to MA organizations, Part D sponsors, and cost plans, CMS refers to each of these regulated entities as a “plan.”

In the Medicare and Medicaid Programs; Contract Year 2022 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicaid Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly Final Rule (hereinafter referred to as the January 2021 final rule), CMS codified guidance contained in the MCMG by integrating it with existing regulations. In the Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly Final Rule (hereinafter referred to as the April 2023 final rule), CMS then finalized several changes to 42 CFR parts 422 and 423, subpart V, to strengthen beneficiary protections and improve MA and Part D marketing.

In the Contract Year 2027 proposed rule, CMS proposed several changes to requirements regarding the time and manner of plans' outreach to beneficiaries. The primary proposals included three changes to Sec. Sec. 422.2264(c) and 423.2264(c) to remove rules on the time and manner of beneficiary outreach. In addition, at Sec. Sec. 422.2264(c)(3), 423.2264(c)(3), 422.2274(b)(3), 423.2274(b)(3), 422.2274(c)(9)(ii), and 423.2274(c)(9)(ii), CMS proposed a few other regulatory changes to add specificity and clarify policy. As CMS stated in the Contract Year 2027 proposed rule, in total, these proposals and clarifications were designed to improve the enrollment decision-making process by creating a more convenient, beneficiary-friendly outreach experience and to reduce the burden on beneficiaries, plans, and agents/brokers. Furthermore, CMS noted that these proposals align with the January 31, 2025, Executive Order 14192, “Unleashing Prosperity Through Deregulation” (hereinafter referred to as E.O. 14192).\49\ E.O. 14192 describes the Administration's policy goals to promote prudent financial management and alleviate unnecessary regulatory burdens. Section 2 of E.O. 14192 states that it is the policy of the executive branch to be prudent and financially responsible in the expenditure of funds, from both public and private sources, and to alleviate unnecessary regulatory burdens placed on the American people. The changes CMS proposed are deregulatory and therefore support the Administration's policy goals.

\49\ https://www.whitehouse.gov/presidential-actions/2025/01/unleashing-prosperity-through-deregulation/.

CMS solicited comment on the proposed changes to Sec. Sec. 422.2264(c)(3), 423.2264(c)(3), 422.2274(b)(3), 423.2274(b)(3), 422.2274(c)(9)(ii), and 423.2274(c)(9)(ii), including on the accuracy of CMS's assumptions regarding information collection requirements. CMS did not receive comment on the information collection requirements. CMS thanks commenters for their input on the proposed amendments and removal of rules regarding time and manner of beneficiary outreach. In the following sections, CMS describes each proposal, along with the comments received and CMS's corresponding responses. 1. Marketing Events Following Educational Events in Same Location

In the January 2021 final rule, CMS codified guidance existing in the MCMG regarding events with beneficiaries. The finalized regulation text at Sec. Sec. 422.2264(c)(2)(i) and 423.2264(c)(2)(i) required that if a marketing event directly followed an educational event, the beneficiary must be made aware of the change from an educational to a marketing event and be given the opportunity to leave prior to the marketing event beginning. In the April 2023 final rule, CMS modified Sec. Sec. 422.2264(c)(2)(i) and 423.2264(c)(2)(i) to prohibit marketing events from taking place within 12 hours of an educational event in the same location (that is, the entire building or adjacent buildings). This prohibition was intended to protect beneficiaries from feeling pressured to stay for a marketing event after having attended an educational event. However, it also created additional barriers for plans or agents/brokers as well as beneficiaries who wished to discuss potential enrollment options with respect to specific plan products following an educational event.

As described in the April 2023 final rule, approximately half of the commenters opposed this provision. Some commenters stated that agents/brokers were not hurting seniors by holding a marketing event after an educational event, that this provision would result in beneficiaries being upset with agents/brokers for something that is out of their control, that it would not add any additional protection from marketing abuses, that it would degrade the consumer experience, and that the proposal was both heavy-handed and unworkable. Furthermore, some commenters were concerned that the number of educational events would decrease, resulting in beneficiaries being less informed regarding plan options overall and increasing the likelihood of a beneficiary enrolling in a plan that did not meet their health care needs. Other commenters said that the 12-hour delay was burdensome, specifically for dually eligible, low-income, disabled, and other underserved beneficiaries, who might experience transportation barriers or lack access to transportation. Such barriers factor in when beneficiaries are forced to travel to separate locations to attend an educational event and a separate marketing event 12 or more hours later, thus making access to information and resources in just one interaction a critical component. For greater detail on the different types of burden potential identified by commenters, see the April 2023 final rule.

Following the April 2023 final rule, CMS has continued to receive stakeholder feedback reiterating concerns about the burden placed on both plans or agents/brokers and beneficiaries regarding the 12-hour delay requirement. While CMS considered similar hypothetical concerns prior to finalizing the April 2023 rule, the Agency is now reconsidering these requirements based on valuable input, such as the real-world experience cited in stakeholder feedback. After reevaluating these impacts, CMS is concerned that the requirements at Sec. Sec. 422.2264(c)(2)(i) and 423.2264(c)(2)(i) do impose an unnecessary burden on beneficiaries and plans and agents/brokers. Furthermore, CMS believes, based on stakeholder input, that the 12-hour delay requirement between an educational event and a marketing event may also create an unnecessary barrier to accessing important MA and Part D information for beneficiaries, especially those who live far from the events or those who lack access to transportation. Moreover, based on a lack of evidence of a quantifiable protection to the beneficiary from the existing regulatory requirement, CMS believes that the beneficiary protections that CMS previously identified in the April 2023 final rule have not materialized. For example, in the April 2023 final rule, CMS explained that its concern about inappropriate pressure on beneficiaries (especially dually eligible individuals and other vulnerable groups) that may occur when marketing events occur

directly after educational events outweighed some of the access and transportation concerns. However, CMS is now reconsidering these previous positions taken in 2023 because for vulnerable beneficiaries, especially those in SNPs, it is common to have caregivers or other friends or family members provide assistance in gathering information on plan options (and often ultimately make decisions on behalf of the beneficiary), thus, there is often a built-in layer of added protection from any potential undue pressure. CMS notes that there are also various beneficiary protections in place, including the possibility of providing special enrollment periods (SEPs) when appropriate, or, if warranted, processing a retrospective enrollment to place the beneficiary back into their prior coverage, if a beneficiary makes an adverse enrollment decision based on misrepresentation or otherwise non-compliant sales tactics. Thus, CMS proposed that plans and agents/ brokers should be able to hold an educational event and a marketing event back-to-back and in the same location.

For these reasons, in the Contract Year 2027 proposed rule, CMS proposed to eliminate the 12-hour delay requirement, so that a marketing event may take place directly following and in the same location as an educational event. This proposal aligned with section 1851(j)(1)(D)(ii) of the Act, which prohibits sales and marketing activities at educational events but does not require a specific timeframe between an educational event and a marketing event. CMS also noted that this proposal, permitting marketing events to follow educational events, provided there is an appropriate break, is consistent with the statutory requirement. CMS proposed to amend paragraph (c)(2)(i) in both Sec. Sec. 422.2264 and 423.2264 to state that if a marketing event directly follows an educational event, plans and agents/brokers would be required to notify the beneficiary that the educational event is ending and a marketing event will begin shortly. CMS provided examples of appropriate beneficiary notification, such as a verbal announcement at the educational event or a clear and distinct notation on a written schedule of the day's event. In addition to the beneficiary notification, CMS proposed that plans and agents/brokers would also be required to give the beneficiary a sufficient opportunity to leave the educational event prior to the start of the marketing event. CMS noted that an example of “a sufficient opportunity to leave” appropriately given by the plan or agent/broker would be a brief restroom or snack break between the educational event and the marketing event. CMS stated in the Contract Year 2027 proposed rule that this deregulatory change is expected to significantly reduce burden and cost for plans and agents/brokers in terms of event planning, and it would also likely ease burden on beneficiaries when they attend an educational event and subsequently want to obtain more plan-specific information at a marketing event. CMS underscored that, by allowing both types of events to occur at the same location once beneficiaries are made aware of both events and given a sufficient opportunity to leave, beneficiaries would not need to return on a different day or to a different venue to attend a marketing event. As such, CMS expressed in the Contract Year 2027 proposed rule that this proposal would provide greater convenience for beneficiaries and enhance the beneficiary experience in shopping for a plan.

CMS received the following comments on this proposal, and CMS's response follows:

Comment: Many commenters supported eliminating the 12-hour delay between an educational event and a marketing event, viewing it as overburdensome and confusing. They noted that beneficiaries attending educational events often wanted immediate personalized guidance and that forcing them to wait disrupted natural inquiry flow, leading to disengagement or frustration. Commenters viewed the delay as serving no protective purpose when beneficiaries actively requested assistance. In addition, commenters emphasized that agents/brokers should be empowered to respond to beneficiary-initiated questions without fear of regulatory violation.

Response: CMS appreciates the support for this proposal and agrees with commenters' sentiments regarding potential implications of the 12- hour delay on beneficiaries and agents/brokers.

Comment: Some commenters highlighted practical benefits of CMS permitting marketing events to follow educational events, noting that the change would reduce transportation burdens (especially for dually eligible individuals), allow multiple meetings in a single day, increase outreach efficiency, and better utilize limited staffing resources, which is particularly important for smaller plans serving geographically dispersed populations. Commenters also stated the change would reduce unnecessary delays and administrative burden while preserving beneficiary protections. The proposal was viewed as a practical, beneficiary-friendly improvement that promoted timely access to information, reduced confusion, and improved the beneficiary experience while maintaining appropriate safeguards.

Response: CMS agrees that there are many practical benefits to allowing marketing events to follow educational events, including those related to transportation and administrative burden relief, time saving, and efficiency. CMS also agrees that this proposal would help beneficiaries while also preserving safeguards.

Comment: A commenter stated that the proposal would allow plans and agents/brokers to provide education followed by enrollment at the same event, enabling in-person discussion of unique situations. A commenter noted that the change would allow tailored outreach aligned with beneficiary preferences, enable quicker and more responsive communication, and result in better beneficiary experiences and improved health outcomes.

Response: CMS appreciates commenters' support for the promotion of in-person, tailored beneficiary communications that this provision invites. CMS also believes that the provision may improve beneficiaries' experiences and ultimately health outcomes in the long run.

Comment: Other commenters opposed eliminating the 12-hour delay, warning it would merge educational and marketing events into sales seminars that pressure beneficiaries into hasty decisions. Commenters claimed a brief restroom or snack break was inadequate separation between the two event types. These commenters described the waiting period as essential for beneficiaries to digest information, access SHIP resources, conduct research, discuss with families, and make informed choices. Commenters believed that without meaningful separation, the statutory prohibition against sales activities at educational events would become meaningless, particularly given the vulnerabilities of the Medicare-eligible population.

Response: CMS disagrees with commenters that eliminating the 12- hour delay would result in beneficiary pressure. As discussed in the Contract Year 2027 proposed rule, CMS believes that beneficiaries' support from caregivers is a built-in layer of added protection from any potential undue pressure, coupled with other various beneficiary protections, such as potential SEPs, including retrospective enrollments, if warranted. CMS notes that the provision includes the

important requirement that plans and agents/brokers notify the beneficiary that the educational event is ending and a marketing event will begin shortly. CMS disagrees with commenters and believes that a brief restroom or snack break is indeed an adequate separation between the two types of events. Furthermore, in response to the comment about the statutory prohibition against sales activities at educational events, CMS notes, as stated in the Contract Year 2027 proposed rule, that section 1851(j)(1)(D)(ii) of the Act does in fact prohibit sales and marketing activities at educational events but does not require a specific timeframe between an educational event and a marketing event.

Comment: In other comments opposing this provision, commenters cited extensive experiences with unwitting enrollments, including beneficiaries who did not consent, thought they were enrolling in dental/vision only, did not understand network limitations, or had dementia and were enrolled without family present. Commenters mentioned low-income individuals who were pushed into plans without adequate discussion. The commenters described plan marketing violations and suggested that, if finalized, the rule would foster problematic behaviors in an increasingly commission-based market.

Response: CMS understands commenters' concerns but reiterates that beneficiaries are able to take advantage of certain important beneficiary protections such as potential SEPs, including retrospective enrollments, when appropriate, if a beneficiary makes an adverse enrollment decision based on misrepresentation or otherwise non- compliant sales tactics. However, CMS believes that such instances of plan marketing violations and negative beneficiary enrollment experiences that commenters describe are rare, as CMS does not often receive reports or complaints in this area. Additionally, CMS routinely monitors compliance with MA marketing rules and may take compliance action if CMS determines that a plan or agent/broker is out of compliance with these rules.

Comment: Several commenters believed the proposed changes could increase confusion and high-pressure interactions, especially for beneficiaries with complex medication needs, limited health literacy, cognitive impairment, or limited English proficiency. Commenters stated that relying on family presence or SEPs as safeguards is inadequate because caregivers may not help beneficiaries discern where education stops and marketing starts, and that no one is immune from Medicare system confusion. Commenters asserted that relying on SEPs after misleading enrollment was unacceptable because these remedies were exceedingly difficult to use, and many beneficiaries did not seek help until well after problems emerged (e.g., discovering out-of-network providers). Also, commenters stated that beneficiaries might not successfully obtain SEPs due to lack of knowledge about how to access them, leaving them without options once enrolled.

Response: CMS respectfully disagrees. The various beneficiary protections mentioned have previously served as more than sufficient safeguards to potential beneficiary confusion and pressure during both educational and marketing events, as well as during other enrollment processes. This includes the possibility of CMS processing a retrospective enrollment if warranted. As noted previously, CMS routinely monitors compliance with MA marketing rules and may take compliance action if CMS determines that a plan or agent/broker is out of compliance with these rules, including in instances where plans or agents/brokers engage in high-pressure interactions with and possibly confuse vulnerable beneficiaries with complex medication needs, limited health literacy, cognitive impairment, or limited English proficiency.

Comment: A commenter stated that the change could result in educational presentations being less complete and built solely to support subsequent sales activities.

Response: CMS appreciates the commenter's concern but views this as a hypothetical scenario that is unlikely to occur. Specifically, CMS expects relevant safeguards--such as existing requirements for educational events--will protect beneficiaries from being exposed to partial educational presentations that are designed solely to support subsequent sales activities. For example, Sec. Sec. 422.2264(c) and 423.2264(c) prohibit plans and agents/brokers from marketing specific plans or benefits and from conducting sales or marketing presentations at educational events. CMS also notes that plans and agents/brokers have the freedom to design educational presentations as they choose, provided that they remain in compliance with CMS's marketing and communication requirements at 42 CFR part 422, subpart V, and 42 CFR part 423, subpart V.

Comment: Some commenters believed the proposed changes would remove beneficiary protections without replacement, and that each time federal protections were removed, states had to navigate the new landscape or create their own rules. They asserted that state staff spent significant time addressing problematic plan growth rather than advancing integration, MA was described as “the wild west,” and these rules were necessary to prevent vulnerable populations from being pressured into unsuitable products.

Response: CMS thanks commenters for offering this information regarding the state perspective. However, CMS disagrees that the proposed changes would remove beneficiary protections without replacement; rather, CMS is simply amending the existing beneficiary protections. Furthermore, in response to the reference to states creating their own rules, CMS reminds all parties of the statutory and regulatory framework applicable to MA, and that standards established under federal law preempt state law, other than state licensing laws or state laws relating to plan solvency, with respect to MA plans. These federal standards include communications and marketing standards set forth in 42 CFR part 422, subpart V, and 42 CFR part 423, subpart V. Section 1856(b)(3) of the Act states the following: “Relation to state laws. The standards established under this part shall supersede any State law or regulation (other than State licensing laws or State laws relating to plan solvency) with respect to MA plans which are offered by MA organizations under this part.” In turn, CMS's regulation, under Sec. 422.402, closely mirrors this statutory language regarding federal preemption. CMS does note that for D-SNPs, state Medicaid agencies may include communications and marketing requirements in state Medicaid agency contracts as long as the requirements do not conflict with federal requirements.

Comment: Commenters urged CMS to protect PACE enrollments from aggressive MA marketing that might not clearly communicate differences between MA plans and the PACE program, as PACE participants were particularly vulnerable.

Response: While out of scope of the requirements in this final rule, CMS will take this into consideration when evaluating both MA and PACE marketing rules and beneficiary protection rules in the future.

Comment: A commenter asserted that plans, rather than beneficiaries, would benefit from the proposed change and took issue with CMS's reliance on undefined stakeholder input, the presence of others at events, and the availability of corrective measures to support the change.

Response: As previously explained, CMS has received stakeholder input that the 12-hour delay requirement between an educational event and a marketing event makes it difficult for beneficiaries who live far from the events or who lack transportation to access important MA and Part D information. CMS agrees that this input raises legitimate concerns about access challenges. CMS reiterates its stance on the sufficiency of existing beneficiary protections in place and the likelihood of support from beneficiaries' family, friends, and caregivers during education, marketing, and enrollment experiences. CMS believes that eliminating the 12-hour delay between an educational event and a marketing event will foster a better, more convenient plan shopping experience for beneficiaries. For these and other reasons stated in the Contract Year 2027 proposed rule, CMS stands by its reasoning for this change.

Comment: A commenter supported a tailored approach--supporting the change for dually eligible individuals but expressing concern that other MA beneficiaries could be pressured into real-time coverage decisions. Commenters also expressed concerns about potential “unintentional non-compliance.”

Response: CMS thanks the commenter for the idea, but unfortunately such a tailored approach is not feasible because educational and marketing events are attended by a wide range of beneficiaries, including both dually eligible and non-dually eligible individuals. CMS does not believe it would be practical for the 12-hour delay between events to be eliminated for some attendees and not others. CMS is unclear on what the commenter meant by “unintentional non- compliance.” CMS notes that plans are responsible for ensuring compliance with CMS regulations.

Comment: Some commenters recommended that if CMS proceeded with the proposal, it should replace timing guardrails with clear, enforceable standards preventing immediate transitions and ensuring clear beneficiary consent. They suggested, at minimum, there should be sufficient time (30-60 minutes) and space between events so individuals could affirmatively choose whether to attend the marketing event.

Response: CMS appreciates this input and believes that a brief restroom or snack break is a sufficient opportunity for all beneficiaries, including those with mobility concerns, to leave the facility if they wish prior to the beginning of a marketing event.

Comment: Another commenter recommended that if this proposal were finalized, CMS should provide a dedicated office to receive referrals from state departments and SHIP offices, take swift enforcement action, and share complaints with states to enable compliance with state licensing laws.

Response: CMS thanks the commenter for these recommendations. If states or SHIP offices encounter any issues or have questions related to this regulation, they may contact CMS directly through already established channels, including the use of the Complaints Tracking Module and sharing of information as outlined in existing memorandums of understanding (MOUs) that CMS has with states.

After considering all the comments received on allowing marketing events to directly follow educational events in the same location, CMS is finalizing the proposal to eliminate the 12-hour delay requirement, so that a marketing event may take place directly following and in the same location as an educational event, as long as plans and agents/ brokers notify the beneficiary that the educational event is ending and a marketing event will begin shortly and also give the beneficiary a sufficient opportunity to leave the educational event prior to the start of the marketing event. 2. Timing of Personal Marketing Appointment After Scope of Appointment (SOA) Form Completion

Sections 1851(j)(2)(A) and 1860D-4(l)(2) of the Act direct that the Secretary shall establish limitations with respect to the scope of any marketing appointment and that such limitation shall require advance agreement with a prospective enrollee on the scope of the marketing appointment and that documentation of such agreement must be done by the plan. In situations where the marketing appointment is in person, the statute further provides that such documentation shall be in writing. The advance agreement documentation is commonly referred to as the Scope of Appointment (SOA) form. The SOA requirement helps to ensure beneficiaries understand what types of plans will be discussed prior to meeting with a plan or an agent/broker.

Over the course of the past several years, CMS SOA policy has evolved as reflected in CMS's regulatory requirements. This is in part due to changes in the MA market over time, which has led to an evolving understanding of what measures may be appropriate to regulate for improper marketing activities and to ensure that beneficiaries are able to make informed decisions about their enrollment choices. CMS first codified the SOA statutory requirement at Sec. Sec. 422.2268(g) and 423.2268(g) in the Medicare Program; Revisions to the Medicare Advantage and Prescription Drug Benefit Programs Interim Final Rule with Comment Period (hereinafter referred to as the September 2008 IFC) (73 FR 54226), prohibiting plans from marketing during a marketing appointment beyond the scope agreed upon by the beneficiary, and documented by the plan, prior to the appointment occurring. Aligning with the statute, CMS explained that the beneficiary must have the opportunity to agree to the range of choices that will be discussed, and that agreement would have to be documented. Then in the Medicare Program; Medicare Advantage and Prescription Drug Benefit Programs Final Rule (hereinafter referred to as the September 2011 final rule) (76 FR 54634), CMS modified Sec. Sec. 422.2268(g) and 423.2268(g) by designating a specific timeframe standard for the SOA advance agreement--48 hours in advance of the marketing appointment, when practicable. This CMS interpretation was also memorialized in the MCMG at the time. In the January 2021 final rule, CMS made some structural changes to 42 CFR part 422, subpart V, and 42 CFR part 423, subpart V, removed Sec. Sec. 422.2268 and 423.2268, and shifted the SOA rule to Sec. Sec. 422.2264(c)(3)(i) and 423.2264(c)(3)(i). Also, in this January 2021 final rule (86 FR 5890), CMS removed the 48-hour SOA standard again, stating that prior to the personal marketing appointment beginning, the plan (or agent/broker, as applicable) must agree upon and record the SOA with the beneficiary(ies).

In the April 2023 final rule, CMS reverted to the 48-hour SOA standard, prohibiting personal marketing appointments from taking place until after 48 hours have passed since the time the SOA was completed by the beneficiary. However, this change did not include the previously codified “when practicable” because CMS, at the time, believed this phrase nullified the purpose of the 48-hour timeframe given the various reasons why waiting 48 hours may not be practicable.\50\

Therefore, in the April 2023 final rule (88 FR 22336), CMS added the phrase “At least 48 hours” to Sec. Sec. 422.2264(c)(3)(i) and 423.2264(c)(3)(i) to require such a timeframe prior to the personal marketing appointment for the SOA to be agreed upon and recorded with the beneficiary. CMS also finalized two exceptions to the 48-hour SOA rule--one for SOAs that are completed during the last four days of a valid election period for the beneficiary and the other for unscheduled in-person meetings (walk-ins) initiated by the beneficiary (see Sec. Sec. 422.2264(c)(3)(i)(A)-(B) and 423.2264(c)(3)(i)(A)-(B)). These are the current policies for the 48-hour SOA rule.

\50\ For more details, please refer to the Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, Medicare Parts A, B, C, and D Overpayment Provisions of the Affordable Care Act and Programs of All-Inclusive Care for the Elderly; Health Information Technology Standards and Implementation Specifications Proposed Rule (hereinafter referred to as the December 2022 proposed rule).

Similar to the reasoning for proposing to eliminating the 12-hour delay requirement at Sec. Sec. 422.2264(c)(2)(i) and 423.2264(c)(2)(i), CMS believes that the strict 48-hour SOA requirement may create an unnecessary barrier to accessing important MA and Part D information for impacted beneficiaries, and also barriers for plans and agents/brokers distributing this information, without offering a quantifiable protection to the beneficiary. For example, after both the September 2011 final rule and the April 2023 final rule, CMS received numerous inquiries from plans and agents/brokers questioning the logistics of the 48-hour SOA rule and objecting to the rule's tendency to create obstacles to promoting beneficiaries' smooth, informed, and timely decision-making when faced with various enrollment options. The 48-hour delay may have a negative impact on a beneficiary's freedom to engage with a plan or an agent/broker on a schedule that works best for them. On the other hand, the 48-hour delay may require a beneficiary to dedicate more time than they wished to spend should they wish to engage with multiple plans or agents/brokers and need to wait 48 hours before engaging with them and deciding in which plan they wish to enroll.

Consequently, in the Contract Year 2027 proposed rule, CMS proposed to eliminate the 48-hour waiting period required between the SOA completion and a personal marketing appointment, as well as eliminate the two corresponding exceptions to the 48-hour SOA rule. CMS noted that under this proposal, plans and agents/brokers would no longer be required to wait 48 hours between obtaining an SOA and speaking with a beneficiary about plan products. CMS also stressed that beneficiaries would be able to learn about plan products in real time, rather than having to come back for a personal marketing appointment 48 hours later. CMS acknowledged in the Contract Year 2027 proposed rule that, if finalized, it would still require an advance agreement, as statutorily required, but without a specified timeframe, as beneficiaries would be able to fill out an SOA just prior to discussing plan products or may fill out an SOA for a future personal marketing appointment. For this proposed change, paragraph (c)(3)(i) in both Sec. Sec. 422.2264 and 423.2264 would revert to its original language as finalized in the January 2021 final rule by removing the phrase “At least 48 hours” and the phrase “, except for:” and by removing the two exceptions listed at paragraphs (c)(3)(i)(A) and (B). CMS also proposed a minor technical correction in Sec. 422.2264(c)(3)(i) to add the missing word “appointment” after “marketing.”

In the Contract Year 2027 proposed rule, CMS explained that eliminating the 48-hour SOA rule would benefit all parties, especially beneficiaries, by allowing for a discussion of plan products on the beneficiary's schedule. CMS also stated that, similar to the 12-hour delay requirement between an educational event and a marketing event, the 48-hour SOA rule potentially inhibits a beneficiary from receiving information. While the current requirement has an exception for in- person meetings (walk-ins) initiated by the beneficiary, CMS noted that it does not account for other interactions that may take place between the beneficiary and a plan or an agent/broker. In the Contract Year 2027 proposed rule, CMS provided the example of beneficiaries who live far away or those with transportation issues who sign an SOA with a plan or an agent/broker when attending a marketing event, who would be required to come back no less than 48 hours later to meet with that plan or agent/broker again.

CMS acknowledged that in the April 2023 final rule, CMS stated that the burden caused by the 48-hour SOA rule was outweighed by the potential benefit of providing beneficiaries, especially vulnerable beneficiaries, time to speak with caregivers and others who they may rely upon for help or advice or just provide the beneficiary additional time to consider their options. However, in the Contract Year 2027 proposed rule, CMS asserted that a different approach may be appropriate now for a similar reason as mentioned for the proposal to eliminate the 12-hour delay requirement. CMS stated that there is often a built-in layer of added protection from any potential undue pressure, as evidenced by the tendency for vulnerable beneficiaries to have other people help them with plan options and making decisions (for example, caregivers or authorized representatives), together with previously mentioned existing beneficiary protections if a beneficiary makes an adverse enrollment decision based on misrepresentation or otherwise non-compliant sales tactics. In the Contract Year 2027 proposed rule, CMS stated that the Agency is now reexamining the relative protection offered by these other factors and based on additional information that CMS has received about the relative benefit or burden of the 48-hour SOA rule. As described earlier, since the September 2011 final rule, and more recently, the April 2023 final rule, CMS has received numerous clarifying questions regarding the 48-hour timeframe, as well as stakeholder commentaries providing anecdotal and hypothetical concerns and reasons why the 48-hour SOA rule may be harmful to beneficiaries. Criticism regarding the potentially adverse effects on beneficiaries led CMS to further review the unintended consequences of the “cooling off” period. This led CMS to conclude that it may be appropriate for plans and agents/brokers to meet with the beneficiary or the beneficiary's representative sooner than 48 hours after the collection of the SOA form. In other cases, the plan or agent/broker may need to travel long distances, possibly hundreds of miles, to have a follow-up appointment based on the current 48-hour SOA rule, therefore, as stated in the Contract Year 2027 proposed rule, the proposal CMS put forth would also reduce the burden on plans and agents/brokers in addition to beneficiaries and their representatives.

Furthermore, CMS explained that by returning to the same regulatory language as in the January 2021 final rule (and similar language as in the September 2008 IFC)--which aligned with section 1851(j)(2)(A) of the Act--CMS is closely aligning with statute. CMS stated that the Agency believes this proposal to eliminate the 48-hour SOA rule is consistent with the statutory requirement at section 1851(j)(2)(A) of the Act that requires an advance agreement with a prospective enrollee, given the statute does not define the timeframe between the agreement and the marketing appointment with the plan or agent/broker.

In conjunction with proposing to eliminate the 48-hour SOA rule, CMS also proposed a few additional associated regulation changes and

clarified various SOA policies that would further bolster the precision of the remaining requirements should the Agency finalize the elimination of the 48-hour SOA rule. CMS has received questions from plans and agents/brokers regarding SOA policies, and so in the Contract Year 2027 proposed rule, CMS deemed these proposed regulation changes and policy clarifications as necessary and responsive to those questions. CMS requested that plans and agents/brokers review the following information carefully and provide feedback through the comment process. CMS also noted that, if this portion of the rule is finalized as proposed, the SOA policy clarifications contained herein will supersede any existing SOA guidance.

First, CMS proposed to more clearly define what qualifies as a personal marketing appointment. The introductory language at Sec. Sec. 422.2264(c)(3) and 423.2264(c)(3) currently states that personal marketing appointments are those appointments that are tailored to an individual or small group and that personal marketing appointments are not defined by the location. CMS proposed to clarify this regulatory definition by adding language to paragraph (c)(3) in both Sec. Sec. 422.2264 and 423.2264 stating that personal marketing appointments are for purposes of discussing marketing topics, so that the proposed language reads as follows: “Personal marketing appointments are those appointments that are tailored to an individual or small group (for example, a married couple) for purposes of discussing marketing topics.”

In addition to this proposed change to the regulatory text, CMS also clarified in the Contract Year 2027 proposed rule that a small group, for purposes of an SOA, is a limited number of people, generally related or living in the same household. While the regulation provides an example of a married couple, CMS clarified that another example would be a parent and child who are both Medicare-eligible. CMS also explained that meetings with unrelated beneficiaries in a home or a public space, such as a book club at a house or a small group at a library, would require separate SOAs for each individual. In addition, CMS noted that Sec. Sec. 422.2264(c)(3) and 423.2264(c)(3) state that personal marketing appointments are not defined by the location, meaning that such an appointment could take place in-person, telephonically, or virtually.

For more context on what a personal marketing appointment is, in the Contract Year 2027 proposed rule, CMS reminded plans and agents/ brokers of the types of activities that may take place at such an appointment. Per Sec. Sec. 422.2264(c)(3)(ii) and 423.2264(c)(3)(ii), plans and agents/brokers holding a personal marketing appointment may do any of the following: (1) provide marketing materials; (2) distribute and accept plan applications; (3) conduct marketing presentations; and (4) review the individual needs of the beneficiary including, but not limited to, health care needs and history, commonly used medications, and financial concerns.

Following the introductory definition of a personal marketing appointment, Sec. Sec. 422.2264(c)(3)(i) and 423.2264(c)(3)(i) describe the current 48-hour SOA rule. CMS proposed to remove the word “scheduled” before “personal marketing appointment” at Sec. Sec. 422.2264(c)(3)(i) and 423.2264(c)(3)(i), so that the proposed text would state that “prior to the personal marketing appointment,” the MA/Part D plan (or agent or broker, as applicable) must agree upon and record the Scope of Appointment with the beneficiary(ies). Likewise, CMS proposed to amend Sec. Sec. 422.2274(b)(3) and 423.2274(b)(3) to more closely align with Sec. Sec. 422.2264(c)(3)(i) and 423.2264(c)(3)(i) by replacing “prior to meeting with potential enrollees” with “prior to a personal marketing appointment.” CMS explained that these regulatory text changes were necessary to avoid ambiguity and prevent misinterpretation.

CMS stated in the Contract Year 2027 proposed rule that, if finalized as proposed, CMS's removal of the word “scheduled” would mean that an SOA would be required for all appointments that meet the definition of personal marketing appointments. As an example, CMS stated that an SOA would be required for plan/agent/broker-initiated outbound contact and for beneficiary-initiated inbound contact (including walk-ins, unscheduled calls and web-based chats, and web- based forms), as long as the contact is tailored to an individual or small group (as explained earlier in the proposal) for purposes of discussing marketing topics. To be clear, in the Contract Year 2027 proposed rule, CMS stressed that this means that an SOA would be required regardless of whether the personal marketing appointment was initiated by the plan, an agent/broker, or the beneficiary.

Other relevant requirements regarding the SOA are related to the method of delivery and where SOAs may and may not be accepted or collected. In order to align with the statutory requirements at section 1851(j)(2)(A) of the Act, CMS proposed to add that the SOA must be in writing for in-person personal marketing appointments by adding new regulatory text to Sec. Sec. 422.2264(c)(3)(i) and 423.2264(c)(3)(i). CMS pointed out that this proposed change mirrors the statutory requirement which provides that if the marketing appointment is in person, then the SOA must be in writing. The proposed new regulatory text at Sec. Sec. 422.2264(c)(3)(i) and 423.2264(c)(3)(i) would read, “The Scope of Appointment must be in writing for in-person personal marketing appointments.” Additionally, Sec. Sec. 422.2274(c)(9)(ii) and 423.2274(c)(9)(ii) require agents/brokers to establish and maintain a system for confirming that agents/brokers appropriately complete SOA records for all marketing appointments (including telephonic and walk- in). Here, CMS proposed to add the word “personal” to Sec. Sec. 422.2274(c)(9)(ii) and 423.2274(c)(9)(ii), so that it reads “personal marketing appointments” to ensure consistency with the other regulation sections previously mentioned. CMS also clarified that there are many ways that an agent/broker can complete an SOA record, for example, an audio or audio-visual recording or an electronic record would suffice as an SOA record for a personal marketing appointment that does not occur in person. In the Contract Year 2027 proposed rule, CMS listed instances in which SOAs may be accepted or collected, including: (1) plan activities in the health care setting (Sec. Sec. 422.2266(e)(1) and 423.2266(e)(1)); (2) marketing events (Sec. Sec. 422.2264(c)(2)(ii)(C) and 423.2264(c)(2)(ii)(C)); and (3) educational events--in the case where the proposed changes to Sec. Sec. 422.2264(c)(1)(ii)(D) and 423.2264(c)(1)(ii)(D) would be finalized as proposed. CMS also listed instances in which SOAs may not be accepted or collected, including: (1) plan-initiated provider activities (Sec. Sec. 422.2266(d)(1)(i) and 423.2266(d)(1)(i)); and (2) activities performed by social workers of an I-SNP (employees, agents, or contracted providers) (Sec. 422.2266(f)(3)).

Regarding the content of the SOA, CMS clarified in the Contract Year 2027 proposed rule that, because Sec. Sec. 422.2264(c)(3)(iii) and 423.2264(c)(3)(iii) require that plans and agents/brokers holding personal marketing appointments may not market any health care related product during an appointment beyond the scope agreed upon by the beneficiary and documented in an SOA, the SOA must therefore include, at a minimum, the

type of product(s) to be discussed. CMS asserted that this aligns with section 1851(j)(2)(A) of the Act's reference to “the scope of the marketing appointment” and provided the following non-exhaustive list of examples of types of products to be discussed: MA plans, MA-PD plans, and standalone PDPs. As a best practice, in addition to the type of product(s) to be discussed, CMS encouraged plans to also include other pertinent information in the SOA, such as the date of the appointment and beneficiary contact information. In addition, CMS stated that on the SOA form, CMS permits plans to have check boxes or requests from the beneficiary regarding the type of product(s) to be discussed, for example, an internet site with an online form that requests a plan or an agent/broker to contact the beneficiary. As explained in the Contract Year 2027 proposed rule, provided this type of SOA form addresses the type of product(s) to be discussed, the plan or agent/broker may contact the beneficiary after the form has been filled out. CMS also clarified that Business Reply Cards (BRCs), voicemails, online forms, or other requests for information that include the type of product(s) to be discussed are, in effect, SOAs. CMS noted that the Agency currently does not provide a model document for SOAs.

Lastly, in the Contract Year 2027 proposed rule, CMS reminded plans and agents/brokers of and clarified the requirements regarding the validity time period for an SOA. Pursuant to Sec. Sec. 422.2264(c)(3)(iii)(A) and (B) and 423.2264(c)(3)(iii)(A) and (B), SOAs, BRCs, and other requests for additional information are valid for 12 months following the beneficiary's signature date or the date of the beneficiary's initial request for information. During this 12-month period, plans or agents/brokers may contact beneficiaries regarding the agreed upon scope of products documented in the SOA. CMS clarified that this does not grant permission to discuss products not previously agreed upon in the original SOA; any new product discussion outside the scope previously agreed upon would require a new SOA. This includes the same product for a different year (for example, if there is an SOA to discuss contract year 2026 plans, then a new SOA would be required to discuss contract year 2027 plans). Finally, CMS noted that the signed SOA can be used for multiple telephonic or in-person contacts or appointments. With that said, a plan or agent/broker must respect a beneficiary's request to no longer be contacted, even if that additional contact takes place within the 12-month window.

CMS received the following comments on this proposal, and CMS's response follows:

Comment: The majority of commenters strongly supported eliminating the 48-hour waiting period between obtaining an SOA and conducting a personal marketing appointment. Commenters characterized the requirement as creating unnecessary delays, administrative burden, and paperwork without providing meaningful beneficiary protection. The waiting period was described as preventing timely assistance, particularly for beneficiaries with urgent needs or limited availability, and taking valuable time away from agents/brokers during the short open enrollment window. Commenters believed the 48-hour SOA rule created situations where beneficiaries were available, agents/ brokers were available, and questions were time-sensitive, yet agents/ brokers could not answer questions, provide quotes, or explain benefits for 48 hours. This was viewed as dismissive, confusing, bureaucratic, and distrust-inducing from the beneficiary perspective. Commenters noted that by the time 48 hours passed, many beneficiaries contacted someone else, enrolled immediately without the help of an agent/broker, or worked with individuals who did not follow the rules.

Response: CMS appreciates the strong support for this proposal and agrees with commenters' sentiments regarding potential implications of the 48-hour SOA rule on the interactions between beneficiaries and agents/brokers.

Comment: Some commenters suggested that the SOA often confused beneficiaries who were eager to understand their options and created unnecessary barriers to access. Commenters believed the cooling-off period assumption that beneficiaries were incapable of requesting information responsibly was both inaccurate and disrespectful. Eliminating the waiting period, commenters believed, would allow beneficiaries to engage with knowledgeable, trained advisors on a timeline that worked best for them and enable same-day appointments.

Response: CMS understands that the SOA could potentially be confusing to beneficiaries or present a barrier to access, and CMS appreciates the commenters' support for removing the 48-hour waiting period.

Comment: A few commenters characterized the 48-hour SOA requirement as a unique administrative burden imposed specifically on agents/ brokers that did not apply to other enrollment channels. They stated that this disparity created an uneven playing field and introduced unnecessary friction into the enrollment process.

Response: CMS acknowledges the commenters' implication that they are pleased with CMS's proposal to eliminate the 48-hour SOA requirement to give agents/brokers selling MA and Part D products a more even playing field as compared to agents/brokers selling other insurance products. CMS appreciates this observation and the support for this proposal expressed by commenters.

Comment: Some commenters recommended eliminating the SOA requirement entirely and implementing a uniform post-enrollment rescission period applicable to all channels. They suggested that this would allow beneficiaries a designated timeframe after enrollment to review their decisions and change their minds if necessary, providing more robust and beneficiary-centric safeguards. If CMS retained the SOA requirement, commenters suggested allowing one universal SOA at first contact, permitting immediate discussion of benefits once completed, eliminating the 48-hour waiting period, and allowing SOAs to remain valid for ongoing discussions.

Response: CMS is not eliminating the SOA requirement entirely, as it is a statutory requirement under section 1851(j)(2)(A) of the Act, as well as out of the scope of CMS's proposal. The concept of a uniform post-enrollment recission period is also outside of the scope of what CMS proposed, but CMS may take this suggestion under consideration for future rulemaking. However, there are various existing beneficiary safeguards already in place, as previously mentioned, such as potential SEPs, including retrospective enrollments, if warranted. Finally, regarding the suggestion to allow one universal SOA at first contact, CMS is not in favor of this approach because requiring a new SOA for each appointment is an important beneficiary protection that ensures common agreement and clarity regarding the intended scope of each individual personal marketing appointment prior to the appointment taking place.

Comment: Several commenters opposed eliminating the 48-hour waiting period and urged CMS to retain it. Commenters stated that the waiting period was designed to protect

beneficiaries from high-pressure sales tactics and provide time for them to consult with family or caregivers before making enrollment decisions, and that removing this safeguard would increase the risk of rushed and uninformed enrollments, further undermining trust in the Medicare enrollment process. Some commenters believed the 48-hour cooling-off period already struck the appropriate balance by reducing the likelihood that beneficiaries would be subject to undue pressure and giving beneficiaries the opportunity to consider their options fully before making key decisions. Regarding other safeguards that CMS identified in the Contract Year 2027 proposed rule, such as potential availability of assistance from family and availability of SEPs in the event of certain marketing or enrollment improprieties, some commenters deemed these as inadequate on their own to ensure beneficiaries had the opportunity to engage in well-informed decision-making during enrollment.

Response: CMS acknowledges commenters' concerns with eliminating the 48-hour waiting period before a beneficiary's personal marketing appointment. However, as stated in the Contract Year 2027 proposed rule, the 48-hour delay may have a negative impact on a beneficiary's freedom to engage with a plan or an agent/broker on a schedule that works best for them. In the time since the 48-hour delay went into effect, CMS has received multiple email inquiries from agents/brokers who have provided real-world examples of how this rule has had unintended negative consequences for the beneficiary. For example, if a beneficiary calls an agent to discuss MA plan options but does not immediately connect and instead leaves a message for the agent to call back, when the agent does call back, the agent must complete the SOA with the beneficiary, and then inform the beneficiary that they are unable to discuss MA plan options until 48 hours later. Another example is a beneficiary completes an SOA to discuss Part D options, meets with an agent, and during the conversation, the beneficiary asks about MA. In this scenario, the agent must complete a new SOA, but based on the current regulation, must then wait an additional 48 hours before the discussion about MA options can continue. In eliminating such a delay, CMS is enabling beneficiaries to learn about plan products in real time, rather than having to come back for a personal marketing appointment 48 hours later. Additionally, CMS reiterates its stance on the sufficiency of existing beneficiary protections in place and the likelihood of support from beneficiaries' family, friends, and caregivers during education, marketing, and enrollment experiences. CMS believes such safeguards offer appropriate beneficiary protection in the absence of the 48-hour SOA rule.

Comment: Commenters believed that having no waiting period presented the possibility of agents/brokers pressuring beneficiaries to sign an SOA directly before an appointment. Commenters asserted that this would be wholly inappropriate in light of ongoing pressure tactics deployed in MA marketing. Commenters urged CMS to, at a minimum, prohibit the SOA from being signed simultaneously with the beginning of a personal marketing appointment.

Response: Any pressure tactics deployed during MA marketing events would be considered non-compliant and subject to potential compliance or enforcement action by CMS. Moreover, concerns about potential pressure tactics could be mitigated by existing beneficiary safeguards already in place, as previously mentioned, such as potential beneficiary support from caregivers and potential SEPs, including retrospective enrollments, if warranted. Such safeguards offer appropriate and sufficient beneficiary protection in the absence of the 48-hour SOA rule. Plans and agents/brokers will still be required to complete an advance agreement (an SOA form) as statutorily required, just without a specified timeframe, giving beneficiaries the flexibility to fill out an SOA just prior to discussing plan products or in advance of a future personal marketing appointment.

Comment: A commenter expressed that community health centers routinely assisted patients who later discovered high-cost sharing, restrictive networks, or prior authorization barriers, with no recourse until the next enrollment period. Thus, in this commenter's opinion, removing the 48-hour SOA safeguard would increase rushed and uninformed enrollments.

Response: CMS thanks the commenter for sharing these unfortunate beneficiary experiences at community health centers. CMS notes that beneficiaries are always encouraged to contact 1-800-MEDICARE if they believe that they have been misled or steered into a plan that does not meet their needs as a result of plans or agents/brokers engaging in misrepresentation or otherwise non-compliant sales tactics. As previously noted, CMS has the ability to grant SEPs, when warranted, including the potential for retrospective enrollments. Finally, CMS takes such beneficiary complaints seriously and will take compliance or enforcement actions as appropriate, including in such cases of rushed and uninformed enrollments per the commenter's concerns.

Comment: Commenters encouraged CMS to prioritize protecting beneficiaries from abusive marketing practices over the interests of marketing and brokerage firms or MA plans. Commenters characterized the proposal as primarily benefiting agents/brokers rather than beneficiaries, despite CMS's stated rationale. Commenters stated that the proposed change seemed to remove guardrails previously put in place to protect beneficiaries.

Response: CMS agrees with commenters' sentiment that protecting beneficiaries from abusive marketing practices is of utmost importance. CMS assures commenters that the Agency is committed to ensuring existing important beneficiary protections remain in place. As previously mentioned, there are a range of such beneficiary protections, and CMS engages in active oversight of plans, holding plans accountable for complying with CMS rules and ensuring that their contracted agents/brokers also comply. In light of the beneficiary safeguards outlined here, CMS does not believe the 48-hour SOA guardrail is necessary. In instances of beneficiary harm, CMS will take compliance or enforcement actions as appropriate.

Comment: A few commenters supported eliminating the 48-hour waiting period after signing an SOA but emphasized it was critical that CMS maintain strong structural safeguards. For example, commenters believed that SOAs must still be required before any personal marketing discussion, clear definitions around what constituted a personal marketing appointment were helpful, and consistency across guidance was essential. Commenters also noted that simplification was beneficial, but any relaxation of oversight would inevitably be exploited by bad actors. Commenters recommended that CMS should streamline the process but not weaken the protections that kept beneficiaries safe. While not opposed to administrative simplification and finding the right ways to safeguard and protect beneficiaries in a competitive landscape, commenters stated that they would have liked to see new or different proposals rather than simply removing existing protections.

Response: SOAs are still required before personal marketing appointments. CMS's removal of the

word “scheduled” means that an SOA will be required for all appointments that meet the definition of personal marketing appointments. As an example, an SOA will be required for plan/agent/ broker-initiated outbound contact and for beneficiary-initiated inbound contact (including walk-ins, unscheduled calls and web-based chats, and web-based forms), as long as the contact is tailored to an individual or small group for purposes of discussing marketing topics. To be clear, this means that an SOA is required regardless of whether the personal marketing appointment is initiated by the plan, an agent/ broker, or the beneficiary. CMS thanks commenters for their praise of the clear definition, simplification, and streamlining the process. CMS also agrees on the importance of consistency across guidance, oversight, and beneficiary protections, as stated previously. Regarding the recommendation for new or different proposals, CMS will consider new ideas for future rulemaking in this area.

After considering all the comments received on the timing of a personal marketing appointment after SOA completion, CMS is finalizing the proposal to eliminate the 48-hour waiting period required between the SOA completion and a personal marketing appointment, as well as eliminating the two corresponding exceptions to the 48-hour SOA rule. 3. Scope of Appointment (SOA) Forms at Educational Events

In the January 2021 final rule, at Sec. Sec. 422.2264(c)(1)(ii)(E) and 423.2264(c)(1)(ii)(E), CMS codified rules permitting plans and agents/brokers holding or participating in educational events with beneficiaries to obtain beneficiary contact information, including SOA forms, at educational events. In the April 2023 final rule, at Sec. Sec. 422.2264(c)(1)(ii)(D) and 423.2264(c)(1)(ii)(D), CMS finalized rules that revised these regulations by prohibiting plans and agents/brokers from making available and receiving SOA forms from beneficiaries at educational events (other forms of beneficiary contact information, including BRCs, were still permitted). This is the current policy regarding SOA forms at educational events.

In the Contract Year 2027 proposed rule, CMS proposed to rescind these requirements as finalized in the April 2023 final rule and revert to the language established in the January 2021 final rule, to permit plans and agents/brokers to obtain SOA forms at educational events. Although section 1851(j)(1)(D)(ii) of the Act prohibits sales and marketing activities from occurring at educational events, the statute does not prohibit the collection of SOA forms at educational events. The collection of an SOA form is not a sales or marketing activity but is the making of an agreement regarding what type of product(s) will be discussed in advance of a personal marketing appointment between the beneficiary and the plan or agent/broker. As CMS noted in the Contract Year 2027 proposed rule, by permitting plans and agents/brokers to obtain SOA forms at educational events, the burden on beneficiaries, plans, and agents/brokers would be reduced, and parties would be allowed to conveniently schedule personal marketing appointments to discuss plan options in the future, instead of having to wait until after the educational event ends to schedule an appointment. CMS also pointed out that if plans and agents/brokers are allowed to collect SOAs at educational events, then it decreases the likelihood that beneficiaries might face undue burden and the potential challenge of reconnecting with a plan or agent/broker or traveling back to a venue to locate a plan or agent/broker at the conclusion of an educational event.

In the Contract Year 2027 proposed rule, CMS acknowledged that this proposal reflects a change in the Agency's position as described in the April 2023 final rule where CMS most recently adopted the ban on collecting SOA forms at educational events. For example, as part of its previous reasoning, CMS stated that it was concerned that beneficiaries may feel uncomfortable refusing to fill out an SOA form, or that they may feel obligated to provide this information in exchange for attending an educational event. Upon reconsideration, in the Contract Year 2027 proposed rule, CMS recognized that these concerns regarding beneficiary pressure appear to be outweighed by the importance of maximizing beneficiary access to information on available plan options, which could be accomplished by allowing the collection of SOA forms at educational events. In addition, as previously mentioned, CMS highlighted that there are also beneficiary protections in place should a beneficiary make an adverse enrollment decision based on misrepresentation or otherwise non-compliant sales tactics.

Thus, CMS proposed to modify Sec. Sec. 422.2264(c)(1)(ii)(D) and 423.2264(c)(1)(ii)(D) to permit plans and agents/brokers holding or participating in educational events with beneficiaries to make available and receive SOA forms at those same educational events. Specifically, at paragraph (c)(1)(ii)(D) in both Sec. Sec. 422.2264 and 423.2264, CMS proposed to replace the phrase “Cards, but not including Scope” with the phrase “Cards and Scope” so that it reads “including Business Reply Cards and Scope of Appointment forms.” CMS noted that the remaining distinctions and inherent beneficiary protections between educational events as required under Sec. Sec. 422.2264(c)(1) and 423.2264(c)(1) and marketing or sales events as required under Sec. Sec. 422.2264(c)(2) and 423.2264(c)(2) remain.

CMS received the following comments on this proposal, and CMS's response follows:

Comment: Many commenters supported CMS's proposal to allow the collection of SOA forms at educational events. They noted that current restrictions create unnecessary barriers preventing beneficiaries from receiving timely assistance, as beneficiaries often attend these events seeking help understanding how information applies to their situations and requesting next steps. Commenters believed the change would improve the beneficiary experience by reducing confusion, improving access to guidance, alleviating transportation burdens, streamlining processes, enabling quicker and more responsive communication, and providing greater flexibility for decision-making at convenient times.

Response: CMS appreciates the support for this proposal and agrees with commenters' sentiments regarding the benefits, including improving the beneficiary experience and communication, alleviating transportation burdens, and providing flexibility.

Comment: Commenters also highlighted that the change would enhance workflow efficiency for plans and agents/brokers, modernize Medicare outreach rules, reduce administrative burden, lower costs, and improve resource allocation. Commenters characterized the change as practical, consumer-friendly, and balanced, stating it would support informed decision-making while preserving beneficiary protections.

Response: CMS agrees that this change will result in administrative efficiencies, reduce burden, and result in practical improvements to the beneficiary decision-making process.

Comment: Some commenters opposed CMS's proposal, emphasizing that existing rules protect vulnerable populations from pressure tactics and inappropriate products. They expressed concerns that the change would increase

confusion, high-pressure interactions, and misleading encounters during plan selection, especially for beneficiaries with complex medication needs, limited health literacy, cognitive impairment, limited English proficiency, or those relying on local counseling resources.

Response: As stated in the Contract Year 2027 proposed rule, these concerns regarding beneficiary pressure appear to be outweighed by the importance of maximizing timely beneficiary access to information on available plan options, which could be accomplished by allowing the collection of SOA forms at educational events. In addition, as previously mentioned, there are also beneficiary protections in place should a beneficiary make an adverse enrollment decision based on misrepresentation or otherwise non-compliant sales tactics.

Comment: Commenters questioned characterizing SOA collection as educational rather than as a marketing activity, noting that procuring a signature on an SOA form relates to a sales appointment.

Response: As stated in the Contract Year 2027 proposed rule, CMS reiterates that although section 1851(j)(1)(D)(ii) of the Act prohibits sales and marketing activities from occurring at educational events, the statute does not prohibit the collection of SOA forms at educational events. The collection of an SOA form is not a sales or marketing activity because it does not meet the definition of marketing at Sec. Sec. 422.2260 and 423.2260, which requires the activity to meet specific standards for intent and content. Rather, the collection of an SOA form is simply the making of an agreement regarding what type of product(s) will be discussed in advance of a personal marketing appointment between the beneficiary and the plan or agent/broker.

Comment: A few commenters asserted that when federal protections are removed, states must either navigate the new landscape or create their own rules, and states lose contractor attention to beneficiary protection. Some commenters urged CMS to withdraw the proposal, establish a dedicated office to receive referrals from state insurance departments and SHIP offices, take swift enforcement action against violations, share complaints with state insurance departments, and retain existing standards for beneficiary outreach.

Response: CMS thanks the commenters for these recommendations. If states or SHIP offices encounter any issues or have questions related to this regulation, they may contact CMS directly through already established channels, including the use of the Complaints Tracking Module and sharing of information as outlined in existing MOUs that CMS has with states.

As to the comment that states must create their own rules, CMS reminds all parties of the statutory and regulatory framework applicable to MA, and that standards established under federal law preempt state law, other than state licensing laws or state laws relating to plan solvency, with respect to MA plans. These federal standards include communications and marketing standards set forth in 42 CFR part 422, subpart V, and 42 CFR part 423, subpart V. Section 1856(b)(3) of the Act states the following: “Relation to state laws. The standards established under this part shall supersede any State law or regulation (other than State licensing laws or State laws relating to plan solvency) with respect to MA plans which are offered by MA organizations under this part.” In turn, CMS's regulation, under Sec. 422.402, closely mirrors this statutory language regarding federal preemption.

Comment: Some commenters requested clarity regarding compliant educational environments for SOA collection, “standardized scripts,” clear guidance, and guardrails to prevent beneficiary confusion and promote industry consistency.

Response: Compliant educational environments for SOA collection include any educational events that meet the requirements outlined at Sec. 422.2264(c)(1). CMS is unsure what commenters mean by “standardized scripts,” however, CMS notes that the Agency currently does not provide a model document for SOAs, nor any SOA scripts. CMS will consider the need for any sub-regulatory guidance regarding the finalized policy.

Comment: Some commenters also noted the importance of ongoing oversight and evaluation to ensure changes meaningfully advance beneficiary understanding and trust without unintended consequences and emphasized ensuring discussions are clear about plan benefit offerings. Commenters commended CMS for recognizing the evolving marketing and communications landscape and encouraged the Agency to work proactively to empower beneficiaries to make informed choices.

Response: As stated previously, CMS engages in active oversight and evaluation of plans and their contracted agents/brokers. CMS agrees with commenters that beneficiary understanding and trust are important. CMS also appreciates commenters' commending the Agency's recognition of the evolving MA landscape and proactive work to help beneficiaries. CMS remains committed to improving MA marketing and communications policies.

After considering all the comments received on allowing the SOA at educational events, CMS is finalizing the proposal to permit plans and agents/brokers holding or participating in educational events with beneficiaries to make available and receive SOA forms at those same educational events. 4. Summary of Regulatory Changes

In summary, in the Contract Year 2027 proposed rule, CMS proposed to modify Sec. Sec. 422.2264(c) and 423.2264(c) to improve rules regarding beneficiary outreach and Sec. Sec. 422.2274(b)(3), 423.2274(b)(3), 422.2274(c)(9)(ii), and 423.2274(c)(9)(ii) to add specificity and clarify policy in conjunction with the primary proposals at Sec. Sec. 422.2264(c) and 423.2264(c). These primary proposals included: (1) allowing a marketing event to directly follow an educational event in the same location (provided there is appropriate beneficiary notification and opportunity to leave); (2) allowing a personal marketing appointment to occur at any point following completion of an SOA form; and (3) allowing the SOA form to be collected from beneficiaries at educational events.

CMS received a range of comments pertaining to these proposals, the majority of which reflected support for the regulations. After considering the comments received and for the reasons outlined in the Contract Year 2027 proposed rule and in responses to comments, CMS is finalizing all provisions under Removing Rules on Time and Manner of Beneficiary Outreach as proposed. As finalized, these regulatory changes will remove current rules on the time and manner of beneficiary outreach, reduce burden on beneficiaries, plans, and agents/brokers, foster a convenient, beneficiary-friendly experience in the enrollment decision-making process, and ensure consistency and clarity in the regulatory text.

F. Relaxing the Restrictions on Language in Advertising (Sec. Sec. 422.2262(a)(1)(i), 422.2262(a)(1)(ii), 423.2262(a)(1)(i), and 423.2262(a)(1)(ii))

In the Medicare and Medicaid Program; Contract Year 2022 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicaid Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly final rule (86 FR 5864), hereinafter referred to as the January 2021 final rule, CMS codified

42 CFR 422.2262(a)(1)(ii) and 423.2262(a)(1)(ii), which prohibited MA organizations and Part D sponsors from making unsubstantiated statements, except when used in logos or taglines. Prior to the January 2021 final rule, this requirement was in the Medicare Communications and Marketing Guidelines (MCMG). In the Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly (88 FR 22120), hereinafter referred to as the April 2023 final rule, CMS updated Sec. Sec. 422.2262(a)(1)(ii) and 423.2262(a)(1)(ii) to prohibit MA organizations and Part D sponsors from using superlatives, unless sources of documentation or data supportive of the superlative is also referenced in the marketing or communications material where the superlative is being used. In the April 2023 final rule, CMS asserted that a beneficiary may have no knowledge of how the superlative is determined, which may mislead the beneficiary into believing a statement that is not accurate. At the time, CMS noted that providing current, reliable, and valid data as the basis for superlatives is critical for beneficiaries to review the data themselves (88 FR 22238).

When CMS first codified Sec. Sec. 422.2262(a)(1)(ii) and 423.2262(a)(1)(ii) in the January 2021 final rule, CMS explained that the policies being codified were not new to MA organizations and Part D sponsors as they were already included in the MCMG, on which the industry heavily relied at that time (86 FR 5981). In the Contract Year 2027 proposed rule, CMS explained that, after years of implementation and oversight, including one revision to the requirement, the current restrictions regarding use of superlatives at Sec. Sec. 422.2262(a)(1)(ii) and 423.2262(a)(1)(ii) were unnecessary as, per Sec. Sec. 422.2262 and 423.2262, MA organizations and Part D sponsors are already broadly prohibited from providing beneficiaries marketing and communications materials that are misleading, confusing, or materially inaccurate (90 FR 54956). Although CMS proposed to remove the prohibition on the use of superlatives, MA organizations and Part D sponsors would still be required to ensure that all statements, including superlatives, included in marketing and communications materials do not mislead, confuse, or provide materially inaccurate information to current or potential beneficiaries. CMS noted that the Agency would continue to review materials as described at Sec. Sec. 422.2261 and 423.2261, and may request data, reports, or other documentation that supports the MA organization or Part D sponsor's statements in these materials either as a part of the formal review process or based on beneficiary complaints after the materials are actively being used (90 FR 54956). CMS also explained that it would continue to encourage MA organizations and Part D sponsors to make available to beneficiaries and the public data, reports, or other documentation that supports the superlative to promote informed enrollment decisions (90 FR 54956).

As described in the Contract Year 2027 proposed rule, sections 422.2262(a)(1)(ii) and 423.2262(a)(1)(ii) were intended to strengthen protections for beneficiaries to ensure they had access to all necessary information needed to make an informed enrollment decision (90 FR 54956). However, because Sec. Sec. 422.2262 and 423.2262 already broadly prohibit misleading, confusing, and inaccurate marketing and communications materials, CMS believes that removing Sec. Sec. 422.2262(a)(1)(ii) and 423.2262(a)(1)(ii) will not affect the existing beneficiary protections, which will still be in effect, but will reduce the administrative burden for all parties. CMS also explained that, although removing Sec. Sec. 422.2262(a)(1)(ii) and 423.2262(a)(1)(ii) does not remove the prohibition on providing misleading, confusing, or materially inaccurate information to beneficiaries, it does remove the requirement for MA organizations and Part D sponsors to reference supporting documentation or data directly in the material (90 FR 54957). CMS noted, however, that if this proposed change to CMS's regulations was finalized, MA organizations and Part D sponsors could still choose to make data available to beneficiaries as they determine appropriate, which may reduce the administrative burden (90 FR 54957).

CMS stated it would continue to review applicable materials to ensure they do not provide misleading, confusing, or materially inaccurate information to beneficiaries. To aid CMS in determining if a material is misleading, confusing, or materially inaccurate; in some instances, it may expedite the review process if the MA organization or Part D sponsor provides supporting documentation when submitting marketing materials that include the use of superlatives. Moreover, when CMS is investigating a complaint regarding a misleading, confusing, or materially inaccurate material, CMS may request the plan provide documentation that supports a superlative used, per the Agency's oversight authority at Sec. Sec. 422.504(f)(2) and 423.505(f)(2).

In the Contract Year 2027 proposed rule, CMS provided examples of quantifiable superlatives that would be acceptable if this provision was finalized, such as “highest rated providers in Chester County,” “largest provider network in Florida,” or “highest rated plan in Virginia” (90 FR 54957). Further, CMS noted that MA organizations and Part D sponsors would need to be able to factually support such superlatives through data, surveys, studies, or other type of information, and when requested, provide that information to CMS (90 FR 54957). In addition, when including superlatives based on older data, to ensure that they are not misleading or confusing, MA organizations and Part D sponsors should indicate the year or in some way show the statement is based on data older than the current or prior contract year. CMS explained that the use of a superlative such as “The most popular Medicare Prescription Drug plan in Montgomery County in 2023” would be acceptable (90 FR 54957). Conversely, CMS noted that the Agency would generally find the same statement to be misleading if the date was missing (90 FR 54957).

CMS recognized that not all superlatives can be quantified or reasonably measured. For example, the use of superlatives such as “our plan cares about you the most” and “we have the most dedicated providers in our network” (90 FR 54957). CMS explained that both examples would be permissible, and CMS would not expect MA organizations or Part sponsors to provide supporting documentation as a part of submission, nor would the Agency request such information as a part of a complaint investigation (90 FR 54957).

Consistent with Executive Order 14267,\51\ Reducing Anti- Competitive Regulatory Barriers, issued on April 9, 2025, CMS believes that removing the prohibition on the use of superlatives and underscoring the continued requirement of not misleading, confusing, or providing inaccurate information to beneficiaries will likely promote competition as this revision provides more opportunities for MA

organizations and Part D sponsors to innovate while simultaneously protecting beneficiaries' access to accurate materials to help with their enrollment decisions.

\51\ https://www.federalregister.gov/documents/2025/04/15/2025-06463/reducing-anti-competitive-regulatory-barriers.

For the reasons discussed, CMS proposed to delete current paragraphs at Sec. Sec. 422.2262(a)(1)(ii) and 423.2262(a)(1)(ii) in their entirety to remove the prohibition of using superlatives in marketing and communications materials without providing supporting documentation. With this revision, CMS explained that the Agency would renumber current paragraphs Sec. Sec. 422.2262(a)(1)(iii)-(xix) and 423.2262(a)(1)(iii)-(xviii) (90 FR 54957).

Consistent with Executive Order 14192,\52\ Unleashing Prosperity Through Deregulation, issued on January 31, 2025, CMS also proposed deleting the current paragraphs at Sec. Sec. 422.2262(a)(1)(i) and 423.2262(a)(1)(i), which reiterated the prohibition on MA organizations and Part D sponsors providing misleading and inaccurate information to beneficiaries (90 FR 54957). This is a technical change that would remove the duplication of Sec. Sec. 422.2262 and 423.2262, which already require MA organizations and Part D sponsors to not provide misleading, confusing, or materially inaccurate information to current and potential beneficiaries. CMS solicited comments on this proposal and appreciates stakeholders' input on the proposed changes. The Agency received the following comments and provided responses as follows.

\52\ https://www.federalregister.gov/documents/2025/02/06/2025-02345/unleashing-prosperity-through-deregulation.

Comment: Many commenters expressed support for this proposal. They stated that the marketing landscape is currently so restrictive that the actual benefits of plans are often unable to be effectively and clearly communicated to beneficiaries, which can be harmful.

Response: CMS thanks the commenters for their support.

Comment: Many commenters urged CMS to reconsider or revise this proposal as they believed it may result in increased complaints, and a few added that the Agency may not have the bandwidth to adequately oversee all those complaints. Many expressed that this proposal would allow for exaggerated, subjective, and misleading information that beneficiaries may not be able to verify themselves, which the industry has previously experienced. Some commenters underscored examples of past beneficiary complaints related to marketing, including several that highlighted the current substantial marketing of supplemental benefits, which already creates frequent beneficiary confusion. Some commenters requested additional guidance on superlatives that CMS would consider permissible.

Another commenter suggested that CMS maintain the requirement to include supporting documentation for a material with a superlative but modify it to allow exceptions for media formats with limited time and space. Another suggested that CMS adopt limitations with this proposal, such as prohibiting the use of superlatives when marketing materials describe benefits or prices of a plan.

Response: CMS appreciates the feedback on this proposal and acknowledges the commenters' concerns and suggestions. However, CMS maintains that the existing marketing and communications requirements at Sec. Sec. 422.2262 and 423.2262 uphold beneficiary protections against misleading, confusing, and inaccurate information. CMS will continue oversight of marketing materials, as statutorily required, and will adjust resources accordingly if there is an increase in the volume of complaints. As such, the Agency will consider the use of superlatives and may request supporting documentation when conducting marketing material reviews or investigating beneficiary complaints.

CMS acknowledges that some supplemental benefits can be complex and challenging for beneficiaries to understand. CMS expects the majority of superlatives that mention benefits, including supplemental benefits, to be quantifiable, as they can be reasonably measured. To offer some examples of superlatives about supplemental benefits, CMS would consider “we have the best supplemental benefits in Texas” to be misleading and confusing as the “best” supplemental benefits are entirely subjective to the health needs of each beneficiary. However, when describing mandatory supplemental benefits as, “we have the most comprehensive dental benefits in Michigan” and “we offer the cheapest over the counter benefits in Beaverhead County,” CMS would not consider those misleading, confusing, or materially inaccurate, provided “most comprehensive” and “cheapest” can be factually supported through data, surveys, studies, or other types of information, and when requested, the plan can provide that information to CMS.

Moreover, during a review of a material that uses a superlative, whether it be a routine prospective review or a retrospective review in response to a complaint, CMS will focus on the use of the superlative in tandem with other regulatory requirements to determine if the overall material is misleading, confusing, or inaccurate. For example, if a material markets an optional supplemental benefit by saying, “we offer the most rides to medical appointments in Oregon,” CMS would consider the use of the superlative “most” acceptable provided it can be factually supported with data, but would consider the statement in its entirety misleading and confusing because it does not include information informing the beneficiary that they must opt into the optional benefit to access it, such as “. . . for those who elect our optional transportation benefit.” That is, CMS would still consider a marketing material misleading, confusing, or inaccurate unless the statement clearly references that the beneficiary must pay for, elect, or opt in to the optional benefit mentioned. Additionally, for superlatives focused on special supplemental benefits for the chronically ill (SSBCI), for example, CMS would consider “we offer the most meal deliveries in Massachusetts for those who qualify,” to not be misleading, confusing, or inaccurate provided the use of the superlative “most” can be factually supported and the statement clarifies that a beneficiary must qualify for the special supplemental benefit. As a reminder of an additional beneficiary protection, if a marketing material includes any information or statements about SSBCI, that material must include the SSBCI disclaimer as required at Sec. 422.2267(e)(34).

Comment: Numerous commenters urged CMS to continue or increase oversight and monitoring efforts to ensure beneficiaries are protected from misleading, confusing, and inaccurate information. Proactive oversight recommendations included issuing significant civil money penalties or temporary suspension of marketing for repeated non- compliance, requiring correction and re-education campaigns to affected beneficiaries. Another commenter requested clarification on how this proposal will be enforced.

Response: CMS reiterates that the Agency will continue to conduct oversight and monitoring of marketing and communications materials to ensure beneficiaries receive accurate information. In addition, beneficiaries or their caregiver can report misleading marketing to 1- 800-MEDICARE. As

noted previously, when investigating a marketing or communications material for accusations of the material being misleading, confusing, or materially inaccurate, such as from a complaint reported to 1-800- MEDICARE, if the material includes the use of superlatives, CMS may request supporting documentation from MA organizations and Part D sponsors per the Agency's oversight authority. Also, CMS reminds MA organizations and Part D sponsors to maintain adequate oversight of entities marketing on their behalf as they are ultimately responsible for ensuring their first tier, downstream, and related entities, as well as TPMOs, comply with CMS's requirements, per Sec. Sec. 422.504(i), 423.505(i), 422.2274(g)(1) and 423.2274(g)(1).

Comment: Some commenters noted that this proposal will not responsibly increase competition and will only lead to greater beneficiary confusion, with a commenter stating that beneficiaries will no longer be able to easily verify the recency of the supporting data.

Response: CMS thanks these commenters for sharing their concerns. CMS disagrees that this rule will create confusion for beneficiaries because MA organizations will continue to be prohibited from providing misleading, confusing, or inaccurate information in marketing and communications materials. As described previously, if a superlative is based on supporting documentation that uses data from before the current or prior contract year, the statement should directly refer to the relevant contract year to not be considered misleading, confusing, or materially inaccurate.

Comment: A few commenters noted that this proposal will not reduce administrative burden, with some stating that it will shift the burden away from plans and onto beneficiaries, with another commenter stating that this signals CMS's intent to neglect its oversight of marketing. Another commenter remarked that this proposal may result in higher operational costs, yet a different commenter stated that this proposal will be especially beneficial for small plans.

Response: CMS respectfully disagrees that this provision will shift administrative burden onto beneficiaries, nor does this proposal impede CMS's oversight of marketing. MA organizations and Part D sponsors will still remain responsible for complying with the robust beneficiary protections that remain at Sec. Sec. 422.2262 and 423.2262. This includes that MA organizations and Part D sponsors are still required to ensure their materials do not include misleading, confusing or inaccurate information and the Agency will continue oversight of all marketing and communication materials for compliance with these requirements. In addition, CMS reiterates here that MA organizations and Part D sponsors remain ultimately responsible for entities marketing on their behalf and should maintain adequate oversight of said entities. While a quantifiable superlative must be able to be substantiated by supporting documentation, CMS reiterates that this provision could reduce administrative burden, depending on plans' internal processes, as the supporting documentation must no longer be provided directly in the material. The Agency appreciates the feedback that this provision may be especially beneficial for small MA organizations and Part D sponsors that may have less administrative capacity.

Comment: Another commenter stated that this proposal might negatively impact Make America Healthy Again (MAHA) priorities.

Response: Without any examples of how or why, CMS does not see how this proposal negatively impacts MAHA priorities.

Comment: A commenter asked CMS to specify what types of supporting documentation would be acceptable for substantiating superlative statements.

Response: CMS has similar expectations for supporting documentation as the Agency did previously. CMS expects supporting documentation data to reflect data, reports, studies, or other documentation that applies to the current year. If the supporting documentation includes data that is not from the current or prior contract year, as described previously, it would be permissible if the older contract year is referenced in the superlative. In the Contract Year 2027 proposed rule, CMS provided examples of permissible superlatives supported by data from prior contract years, which CMS will include in the Agency's review of marketing materials and requests for supporting documentation when necessary.

Comment: Another commenter wrote that CMS should allow descriptive language such as superlatives and terms like “free” when the statements are substantiated by facts. Another commenter noted that advertising rides to medical appointments as “free” could be misleading if there are only a limited number of rides.

Response: As noted in this rule, CMS agrees that superlative statements should be permitted in marketing and communications materials provided they can be factually supported, when applicable, as previously discussed. However, CMS also notes that the use of the term “free” is outside the scope of this proposal as “free” is not a superlative. Currently, Sec. 422.2262(a)(1)(xiii) prohibits the use of “free” in certain scenarios, and Sec. 422.2262(a)(2)(iii) explains when the term “free” may be used.

Comment: A couple of commenters urged CMS to reinstate the “meaningful difference” requirement, which would limit plans to only benefit packages that are “substantially different” from other plans offered by the same parent organization in a service area.

Response: CMS appreciates these comments and will take them into consideration. However, the “meaningful difference” requirement that was previously in place is outside the scope of this proposal.

After consideration of the public comments CMS received, CMS is finalizing these provisions as proposed.

G. Third-Party Marketing Organization (TPMO) Oversight: Revising the Record Retention Requirements for Marketing and Sales Call Recordings Sec. Sec. 422.2274(g)(2) and 423.2274(g)(2)

In the Contract Year 2027 proposed rule, CMS proposed to codify the revision of marketing and sales recording requirements at 42 CFR 422.2274(g)(2) and 423.2274(g)(2). Consistent with the 10-year record retention requirements and access to records requirements described in Sec. Sec. 422.504(d) and (e)(1)(iv) and Sec. Sec. 423.505(d) and (E)(1)(iv), MA Organizations and Part D sponsors are presently expected to retain the sales and marketing call recordings described in Sec. Sec. 422.2274(g)(2) and 423.2274(g)(2) for 10 years. CMS proposed to update Sec. Sec. 422.2274(g)(2)(ii) and 423.2274(g)(2)(ii) to reduce the amount of time that MA Organizations and Part D sponsors are required to retain recordings of marketing and sales calls to 6 years, while maintaining the requirement that enrollment records be retained for 10 years, as required under Sec. Sec. 422.504(e)(1)(iv) and 423.505(e). This proposal only modified the record retention requirements for the marketing and sales portions of calls at 42 CFR part 422, subpart V and Part 423, Subpart V. CMS has long required enrollment records to be maintained for 10 years and the proposal did not remove applicable enrollment documentation and retention requirements set forth in other regulations, specifically the requirement to file and retain enrollment forms as required in Sec. Sec. 422.60(c)(2), 422.504(e)(1)(iv) and 423.505(e)(1)(iv).

To meet enrollment documentation requirements for enrollments that occur over the phone, plans are still required to record the enrollment portion of the call, as the recording in this instance serves as the enrollment form and provides proof that the beneficiary attested to their intent to enroll in accordance with Sec. 422.60(c)(2) and the Medicare Managed Care Manual, Chapter 2, Medicare Advantage Enrollment and Disenrollment, Section 40.1.3. The enrollment portion of the call begins when the beneficiary is advised that they are completing an enrollment request, after which they provide the information as required by the enrollment form and attest to their intention to enroll.

As a part of the Medicare Program; Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Programs; Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency; Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency Final Rule (hereafter referred to as the May 2022 final rule) (87 FR 27704), CMS finalized regulations at Sec. Sec. 422.2274(g)(2) and 423.2274(g)(2) regarding plan oversight of Third-Party Marketing Organizations (TPMOs). Under these regulations, MA organizations and Part D sponsors must have certain requirements in their contracts, written arrangements, and agreements with TPMOs, or between the TPMO and MA organization or Part D sponsor's first tier, downstream, and related entities (FDR). In Sec. Sec. 422.2274(g)(2)(ii) and 423.2274(g)(2)(ii), CMS finalized the requirement that an MA organization or a Part D sponsor's contract, written arrangement and/or agreement with the aforementioned entities must ensure that all calls with beneficiaries are recorded in their entirety. In addition, in order to ensure compliance with the 10-year record retention and access to records requirements described in Sec. Sec. 422.504(d) and (e)(1)(iv) and Sec. 423.505(d) and (e)(1)(iv), MA organizations and Part D sponsors are expected to retain the sales and marketing call recordings described in Sec. Sec. 422.2274(g)(2) and 423.2274(g)(2) for 10 years.

Following the finalization and implementation of the May 2022 final rule, CMS received questions regarding retention requirements for recorded calls, as MA organizations and Part D sponsors were unsure if calls regarding marketing, sales, and enrollment were subject to the 10-year record retention requirements at Sec. Sec. 422.504(d) and 423.505(d). CMS also received questions about the scope of “all calls” for recording purposes, including if the recording requirement extended to calls that merely set an appointment with a potential enrollee, calls to enrollees to confirm welcome packets were received, and other non-marketing or non-sales calls to prospective enrollees. CMS notes that the May 2022 final rule did not provide exceptions or otherwise establish a more defined boundary for the type of call that was subject to recording and retention. To rectify any potential unintended consequences stemming from the standard that CMS codified in the May 2022 final rule, CMS issued the Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program; Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly Policy Final Rule (hereafter referred to as the April 2023 final rule) (88 FR 22120), to address the requirement that all calls be recorded and retained. In the April 2023 final rule, CMS modified Sec. Sec. 422.2274(g)(2)(ii) and 423.2274(g)(2)(ii) to require only the recording of marketing, sales, and enrollment calls, including the audio portion of calls via web- based technology. The implementation of this revised and less burdensome call recording requirement was to ensure the necessary calls were recorded and available for oversight and monitoring while still reducing some level of burden on plans.

CMS has continued to oversee and monitor agent and broker behavior by reviewing call recordings to determine compliance. In addition to CMS, other governmental entities, such as the Department of Justice (DOJ) have relied on call recordings for investigations. CMS has requested call recordings based on complaints from CMS's Complaint Tracking Module (CTM). The requested recordings were chosen based on the severity of the allegations in the complaint. The recordings were reviewed to determine if the claims against the agent or broker were supported by the call recording. The outcome of CMS's review of the marketing and sales portion of the call recordings has been mixed. In some instances, the recordings did not support the beneficiary's complaint as detailed in the CTM. In other instances, the complaints were substantiated by the recording. These reviews have shown examples where agents and brokers fail to provide sufficient information for a beneficiary to make an informed decision or the information provided by the agent or broker is inaccurate. For reviewed complaints that are substantiated, CMS notifies the MA organization or Part D sponsor of the Agency's findings and requests the organization review the results and take appropriate action against the agent, broker, or TPMO. MA organizations and Part D sponsors have responded to CMS's findings with actions such as retraining or discontinuing contracts with certain entities.

MA organizations and Part D sponsors are responsible for ensuring all downstream entities meet CMS's requirements. When CMS proposed revisions to these regulations in the Contract Year 2027 proposed rule, there were over 68 million Medicare beneficiaries, of which 51.1 percent are enrolled in MA and other health plans.\53\ Of the approximately 34 million beneficiaries enrolled in an MA plan or other health plan, 31 percent use agents to assist with plan choices,\54\ resulting in 10,540,000 beneficiaries discussing plan options with agents annually. Each year, only three out of every ten beneficiaries compare plans during Medicare's Annual Election Period,\55\ resulting in approximately 3.1 million beneficiaries using agents or brokers to review their plan choices. Based on these data, CMS conservatively estimated that MA organizations, Part D Sponsors, and their TPMOs must record hundreds of thousands of calls each year to comply with these regulatory requirements, resulting in millions of calls being subject to the 10-year retention requirement.

\53\ https://data.cms.gov/summary-statistics-on-beneficiary-enrollment/medicare-and-medicaid-reports/medicare-monthly-enrollment.

\54\ https://www.medpac.gov/wp-content/uploads/2024/08/Medicare-agents-MedPAC-03.25sec.pdf.

\55\ https://www.kff.org/medicare/issue-brief/nearly-7-in-10-medicare-beneficiaries-did-not-compare-plans-during-medicares-open-enrollment-period/.

CMS recognizes the cost and burden of these requirements. CMS has received comments from industry groups noting the costs associated with recording and retaining the marketing and sales portion of calls. Audio call files are large, taking a substantial amount of data storage, especially when the record retention requirement is to store these calls for 10 years. In addition, to the cost of maintaining these calls, CMS is highly unlikely to review calls past the 6-year mark. To best address marketing complaints, the review of calls typically needs to be much closer to the timeframe of the actual complaint. Reviewing complaints that are 10 years

old may result in the discovery of issues that are irrelevant and that will not result in identifying current issues that affect beneficiaries. Because of these reasons, CMS proposed to reduce the timeframe for the retention of the marketing and sales portion of calls from a 10-year requirement to a 6-year requirement. The revised retention requirement would also apply to currently retained call recordings, meaning that any marketing and sales portion of calls older than 6 years that are currently being retained would no longer need to be retained.

CMS stated that a 6-year record retention requirement for the marketing and sales portion of calls is sufficient for the purpose of enabling CMS to review agent and broker behavior and balances the need for appropriate oversight while also providing consideration of the burden imposed by record retention. It is helpful for CMS to review the marketing and sales portion of audio recordings when the Agency receives complaints from beneficiaries related to being misled into choosing a plan and then enrolling in that plan. The marketing and sales portion of these recordings is most useful when it is recent and permits CMS to provide timely feedback to MA organizations and Part D sponsors, so they may, in turn, quickly address any compliance issues that are identified by CMS review.

When CMS proposed a revised 6-year record retention requirement for the marketing and sales portion of calls, in the Contract Year 2027 proposed rule, CMS also said that the Agency would consider several other alternatives for finalization as described below. CMS considered alternatives based on the cost and burden of recording and storing calls.

One alternative to the proposed 6-year retention requirement was to reduce the 10-year retention requirement for the marketing and sales portion of calls to a 3-year retention requirement. In the Contract Year 2027 proposed rule, CMS noted that a 3-year retention would further decrease existing burden and costs on MA organizations and Part D sponsors but would provide both CMS and other oversight organizations with a shorter lookback period. A shorter lookback period could make it more challenging to identify longer-term trends, including potential trends associated with TPMOs. However, CMS also noted in the Contract Year 2027 proposed rule that a 3-year retention requirement would result in a more significant decrease in burden as compared to the proposed 6-year retention requirement.

In the Contract Year 2027 proposed rule, CMS also considered alternatives such as whether audio recordings of the marketing and sales portion of calls are necessary for record retention purposes or whether the ability to review agent and broker behavior could be achieved via other, less expensive means. Specifically, CMS considered whether permitting written retention of the marketing and sales portion of calls (i.e., a transcript) in lieu of retaining audio recordings of such calls, or a hybrid approach that requires audio recordings for 3 years followed by written retention for the remainder of the retention period would be sufficient to achieve the purpose articulated by CMS in the Contract Year 2027 proposed rule. An important factor to this alternative that CMS considered was the ability of current technology to automate the transcription with sufficient accuracy. CMS stated the Agency was considering that transcripts might still provide CMS with enough ability to review interactions between beneficiaries and agents and brokers to identify non-compliance similar to the review of audio recordings. However, CMS also stated that, on the other hand, transcripts would not capture the tone by which the agent or broker interacted with the beneficiary. The Agency also acknowledged that the data storage costs of retaining transcripts may be less than the data storage costs of audio recordings, further reducing burden if new costs from automated transcription did not outweigh those savings.

Finally, based on the mixed findings from the review of call recordings, CMS considered as an alternative whether maintaining a recording, audio or otherwise, of the marketing and sales portion of calls is necessary at all. The results of the review of these portions of calls, as identified earlier in this proposal, have provided examples that agents and brokers do not always provide accurate and truthful information. Conversely, in other instances, the call recordings offer a way to refute beneficiary complaints, such as those filed through 1-800-MEDICARE. However, by eliminating these requirements, CMS and other oversight organizations would not have the ability to directly review agent and broker behavior to ensure beneficiaries select a plan that best meets their needs. CMS acknowledged there are differences between MA, Part D, Marketplace, Medicaid, and commercial insurance, however, CMS noted the elimination of recording the MA and Part D marketing and sales portion of calls would result in more parity with the requirements of these programs.

CMS solicited comments on all aspects of the proposal and requested comments on other alternatives for consideration in the final rule. CMS thanks commenters for their input. In the following section, CMS describes the comments received and CMS's corresponding responses.

Comment: Numerous commenters supported the proposal to change the call recording requirement from 10 to 6 years, mentioning that auditing recorded calls is a necessary practice to protect beneficiaries. Commenters noted the proposal reflects operational realities while preserving program integrity; assists small and mid-size brokerages regarding storage and cybersecurity; represents a balanced regulatory approach that appropriately reduces administrative and financial burdens; will foster greater competition with the industry, ultimately improving the cost effectiveness and quality of products offered by MA organizations and Part D sponsors; and addresses the issue of compliance costs not proportionality improving oversight outcomes. Commenters stated that a 6-year retention requirement is still sufficient for oversight and monitoring and preserves accountability for enrollment related interactions. Commenters also mentioned that it is unlikely to need call recordings for review beyond certain timeframes ranging from 1 to 6 years. Other commenters supported the proposal with no specific reasons for the support.

Response: We appreciate commenters' support. CMS agrees that the shorter timeframe will still provide CMS, MA and Part D plans, TPMOs, and agents and brokers with the necessary tools for oversight and monitoring. The Agency also appreciates the commenters addressing how the proposal will be beneficial for the industry in areas including storage costs, compliance costs, and operational realities while still protecting beneficiaries.

Comment: Several commenters opposed the proposal and urged CMS to maintain the 10-year record retention requirement. These commenters emphasized that the record retention requirement serves as an important beneficiary protection, supports a Medicare enrollee's marketing violation complaint with Medicare that can lead to a timely resolution (for example, retroactive or prospective enrollment via a SEP), and that the calls constitute an integral source of accountability for TPMOs and MA organizations. A commenter stated that call recordings were needed when plan changes and

billing timelines are pushed into the following year or beyond as claims work through various systems. The commenter stated that CMS's requirements should remain aligned with similar requirements associated with Medicaid and Medicare dually eligible individuals. In addition, this commenter also stated that 10 years may be excessive.

Response: We acknowledge the commenters' concerns. However, we have determined that a shorter record retention period will not compromise beneficiary protections, result in an untimely resolution of a beneficiary, or jeopardize appropriate accountability for TPMOs and MA organizations. Commenters noted that most beneficiary issues and complaints arise within the first few years of a beneficiary's plan enrollment. Reviewing more dated call recordings would provide limited value for oversight, monitoring, or beneficiary assistance, particularly when beneficiaries have transitioned to different plans since the original recording. In some instances, the TPMO, agent, or broker no longer sells MA plans, further limiting the value of a dated call recording. After 6 years, it is also likely that additional training was provided, which resulted in more compliant agent or broker behavior. As for the commenter who stated that call recordings assist in a timely resolution for marketing complaints, CMS agrees that a call recording can assist in a timely resolution for marketing complaints. However, CMS believes that the outcome is often optimized when the issue is addressed within close proximity of a marketing complaint and that keeping call recordings for an additional 4 years would provide no added value in resolving marketing complaints in a timely manner. Regarding the commenter stating that CMS's rules should align with similar Medicaid and Medicare requirements associated with dually eligible individuals, CMS notes that the 6-year requirement would apply to dually eligible individuals who are enrolled into MA or Part D plans, unless a State Medicaid Agency Contract requires a longer retention period. In addition, alignment with State Medicaid programs would be extremely challenging given each state may have different requirements. To protect enrollees, it is longstanding CMS policy that MA and Part D enrollees who believe they may be adversely impacted by an enrollment decision based on an agent or broker misrepresenting plan options may contact 1-800-MEDICARE to request a special enrollment period (SEP) due to the circumstances. CMS reviews the supporting details and documentation for these requests and determines eligibility for an exceptional circumstances SEP on a case-by-case basis.

Comment: A couple of commenters requested that CMS eliminate the call recording requirement entirely without providing any alternatives. These commenters stated that the recordings add unnecessary complexity and cost without demonstratable benefit to clients. The commenters furthered this point in saying the recordings do not solve any issue, and seniors do not like recordings at all.

Response: We appreciate the feedback from the commenters. However, CMS does not support eliminating call recordings in their entirety at this time. Currently, call recordings play an integral role as a beneficiary protection, assist in identifying brokers, agents, and TPMOs that fail to adhere to CMS regulations, and assist in monitoring and oversight of the MA and Part D programs. CMS will continue to gather data on the value of call recordings to further inform future decisions about marketing and sales recording requirements before making any additional changes beyond what was proposed in the Contract Year 2027 proposed rule.

Comment: A commenter stated that CMS should focus monitoring efforts on unscrupulous marketing organizations that have United States call centers that contract with Third Party Marketing Organizations (TPMOs) that use foreign call center representatives. The commenter added that these call centers can spend up to 18 hours a day calling Medicare beneficiaries within the U.S. to get them to enroll or change Medicare Advantage plans. The commenter further stated that these foreign call centers are driven by sales quotas, not beneficiary suitability.

Response: We agree that monitoring call centers, including those contracting with out-of-country entities, is important. Although the commenter's suggestion is out of scope, CMS's review of call recordings assists in identifying unscrupulous marketing organizations, including those that contract with out-of-country entities. In cases where CMS determines marketing violations have occurred, MA and Part D plans are held accountable for the actions of their downstream entities.

Comment: A commenter stated that CMS assumes an audio call meaningfully prevents fraud, citing that beneficiaries sometimes claim the voice is not theirs, resulting in a plan-based enforcement action taken against an agent. The commenter stated that, if a call recording can be dismissed by a beneficiary simply stating, “that is not my voice,” recordings are not immune to dispute, do not conclusively prove identity, create massive data security and privacy risks, and expose agents and beneficiaries to long-term breach liability. This same commenter also said that documentation and transcripts are better because they capture intent, document what was discussed, are searchable and auditable, are less costly to store, and reduce exposure to sensitive voice data. This commenter suggested that CMS allow secure transcripts, summaries, or enrollment attestations instead of call recordings.

Response: We thank the commenter but maintain that call recordings are extremely valuable. Call recordings can capture the intent and the tone of the call, providing a clear, realistic view of the interaction between the beneficiary and the agent or broker that transcripts cannot capture. CMS acknowledges that voice recordings can be manipulated but maintains that they are not quite as easy to manipulate as transcripts. Entire sections of a call can be eliminated in a transcript, which could go unnoticed, while removing a portion of an audio recording would likely be more noticeable. CMS also believes a beneficiary's identity is more likely to be authenticated through a call recording over a transcript. Regarding data breaches and security concerns, CMS recognizes these are areas of concern, but requirements are in place for securing sensitive data. Currently, it is the Agency's position that transcript summaries are too limited and do not provide enough detail to capture inaccurate or misleading information between an agent and a beneficiary during a marketing or sales calls. Likewise, enrollment attestations provide even less information than a transcript summary. Summaries and attestations do not provide the information necessary to properly monitor TPMO marketing and sales calls. CMS agrees with the commenter that transcripts are searchable and less costly to store but does not agree that transcripts have more value than call recordings. Because call recordings are a valuable tool, CMS will not be allowing transcripts in lieu of all audio recordings for the entire retention period, however, CMS is modifying its original proposal to allow the use of transcripts in the last 3 years of the retention period.

Comment: About half of the commenters requested that the requirement for call recordings be eliminated, however, they

acknowledged that if CMS determined a full rescinding of the requirement was not feasible, a reduced retention period of 2 years would be more than sufficient for review purposes. The vast majority of these commenters relayed the same concerns, including legal and practical challenges, logistical and financial strain on independent agents with no measurable enhanced beneficiary protection, unwarranted data management burden, and strains on resources that could otherwise be dedicated to serving beneficiaries. Additional concerns included infrastructure, compliance oversight, data storage, privacy, operational complexities, liability risks, the sheer number of recordings to maintain, and an unnecessary barrier to natural communications between the beneficiary and agent. Commenters also stated that a 10-year retention period is excessive, places an undue administrative burden on independent agents and agencies, and far exceeds what is practically necessary for addressing most beneficiary complaints or conducting CMS investigations. According to commenters, a 2-year record retention period would adequately accommodate compliance needs, allowing for thorough review and investigation without creating an unnecessarily extensive and costly data storage requirement for independent agents who are already managing multiple administrative tasks. Commenters also stated that a 2-year retention period would be entirely sufficient to fully accommodate most beneficiary complaints, CMS investigations, and plan or agent reviews, while maintaining adequate oversight without imposing unnecessary burden on independent agents and freeing up resources for more direct beneficiary support.

Response: CMS values these commenters' suggestions and recognizes that record retention requirements impose additional burden and costs, which may affect independent agents and brokers more than other entities. CMS agrees that call recording retention for 10 years is excessive and exceeds what is necessary to review and address beneficiary complaints. CMS appreciates the commenters understanding CMS's need for call recordings and proposing the alternative 2-year record retention requirement. As stated in the Contract Year 2027 proposed rule, the DOJ utilizes call recordings for investigative and legal purposes. DOJ's investigations and legal proceedings often span multiple years, necessitating access to call recordings that extend beyond a 2-year timeframe. Beyond the DOJ requirements, CMS's monitoring activities, including potential audits, may require access to records beyond a 2-year retention period. Insufficient retention or eliminating call recordings could prevent the identification of misleading agent or broker practices and hinder the ability of MA plans and Part D sponsors to take appropriate corrective action.

Comment: Several commenters expressed support of the proposal to reduce the record retention period while recommending alternative timeframes ranging from 2 to 5 years. Commenters' rationales for a 2 to 5 year record retention period varied by specific reasons but the sentiments were similar in nature. These commenters suggested: noting that a much reduced timeframe would be longer than most consumers remain in a particular plan; there would be ample opportunity for post enrollment reviews; requests for recordings beyond 3 years are uncommon; reduced administrative burden and data storage costs would not impair oversight and audit integrity; existence of consumer protection; alignment with the Federal Trade Commission's Telemarketing Record Retention requirement; more efficient storage of call recordings; a more accurate reflection of real-world compliance timeliness while continuing to support complaint resolution, audits, and enforcement actions; significant reduction in data storage volume and associated costs resulting in meaningful financial and administrative efficiencies for MA and Part D plans without compromising program integrity or beneficiary protections; essential accountability and affordability promoting prudent financial guidance and product offering is maintained; reduction of potential cybersecurity risks; and that it is a correct balance of satisfying CMS's interests while reflecting the pragmatic realities of member churn and administrative burden. Commenters expressed similar concerns as previously noted, regarding the 10-year retention requirement, stating that a 10-year requirement is excessive, places an undue financial and logistical burden on independent agents, and has significant storage costs.

Response: CMS values the feedback from commenters recommending a further reduction from 6 years to a range of 2 to 5 years. CMS agrees that a further reduction in call recording retention requirements will further reduce costs, storage volume, and administrative burden. CMS also agrees that a shorter audio recording retention period is a more accurate reflection of CMS's and DOJ's compliance needs without compromising program integrity. However, CMS maintains that a reduction from a 10-year retention period to a 6-year retention period fulfills the Agency's and DOJ's oversight, investigative, and litigation requirements; while a 2 to 5 year retention period is too limited to adequately address those needs.

Comment: A few commenters supported the alternative of permitting transcripts in lieu of call recordings, citing reasons including substantially less storage, transcripts being more easily ingested by AI systems to review, and a reduction of administrative burden.

Response: CMS thanks the commenters for providing feedback on alternatives to current call recording requirements as well as those that were proposed in the Contract Year 2027 proposed rule. CMS agrees that transcripts are substantially less expensive and require less storage. CMS believes transcripts can be a valuable and cost-effective alternative for call retention. However, CMS believes that call recordings provide additional benefits beyond those provided by transcripts. Call recordings provide the tone of both the beneficiary and the agent, including if the beneficiary is pressured into enrolling in a plan. CMS believes the benefits of call recordings outweigh the benefits of transcripts during the time period that most complaints occur. As mentioned by the commenters, most complaints are addressed within the first few years after a beneficiary enrolls in a plan. A decreased retention period will still adequately support CMS's and DOJ's monitoring, oversight, and litigation needs. Following the timeframe in which most complaints are addressed, CMS believes transcripts can provide the pertinent information if additional review is necessary.

Therefore, based on alternative proposals included as part of CMS's request for comments in the Contract Year 2027 proposed rule and CMS's oversight and monitoring requirements, CMS is finalizing its proposal with a modification to allow for marketing and sales call records to be retained using both audio recordings and transcripts. For the first 3 years of the retention period, records must be maintained in audio format. In the last 3 years of retention (of the 6-year retention period), records may be maintained in either audio format or as complete and accurate transcript recordings. A transcription is considered complete and accurate if it documents the full recording, reflecting all statements made

by the participants as it originally occurred. CMS believes this strikes the appropriate balance in maintaining program integrity while reducing burden and costs on MA organizations.

Comment: A few commenters expressed concerns with call centers. These commenters noted that call centers presented more significant concerns than independent agents and recommended that CMS require recordings from call centers but not from independent agents.

Response: CMS appreciates the suggestion but maintains that, at this time, all sales and marketing calls should be recorded, not just those from call centers. Any agent, regardless of whether the agent works for a call center or is independent, may provide inaccurate information or steer a beneficiary into a particular plan. Complaints received by CMS concern both independent agents and agents working for call centers. Call recordings currently allow CMS and other agencies to fully address these complaints.

Comment: A few commenters mentioned that CMS needs to reduce the retention requirements for enrollment calls, citing that many times the sale, marketing, and enrollment calls are combined, making separating them difficult and more burdensome.

Response: CMS thanks commenters for their feedback. However, the Contract Year 2027 proposed rule did not address the call retention timeframe of enrollment calls and therefore this comment is out of scope.

After careful consideration of public comments, CMS is finalizing in Sec. Sec. 422.2274(g)(2)(ii) and 423.2274(g)(2)(ii) the 6-year marketing and sales call retention policy with a modification to allow for complete and accurate transcripts in the last 3 years of retention. As mentioned above, a transaction is considered complete and accurate if it documents the full recording, reflecting all statements made by the participants as it originally occurred. In summary, all marketing and sales calls, including the audio portion of calls conducted via web-based technology, must be recorded and retained in their entirety for a minimum period of 6 years. For the first 3 years of the retention period, records must be maintained in audio format. For years 4, 5, and 6, records may be maintained in either audio format or as complete and accurate transcript recordings.

H. Rescinding the Requirement for the Notice of Availability (Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33))

The Notice of Availability of language assistance services and auxiliary aids and services (NoA) material, formerly known as the Multi-language insert (MLI), required at 42 CFR 422.2267(e)(31) and 423.2267(e)(33), has been modified in conjunction with changes to the Health and Human Services Office for Civil Rights (OCR) language assistance notification requirements (currently at 45 CFR 92.11), implementing section 1557 of the Affordable Care Act (ACA), 42 U.S.C. 18116. CMS's NoA requirements are closely aligned with and broadly duplicate OCR's NoA requirements and were adopted by CMS to implement and ensure compliance with Title VI, section 504 of the Rehabilitation Act of 1973, and ACA Section 1557 (incorporating Title VI and section 504 by reference). On March 1, 2025, Executive Order (E.O.) 14224 was issued: “Designating English as the Official Language of The United States” (hereinafter referred to as E.O. 14224).\56\ E.O. 14224 designates English as the official language of the United States and includes the revocation of E.O. 13166 of August 11, 2000 (Improving Access to Services for Persons with Limited English Proficiency), but recognizes that “[a]gency heads should make decisions as they deem necessary to fulfill their respective agencies' mission and efficiently provide Government services to the American people” and notes that “nothing in [the E.O.] requires or directs any change in the services provided by any agency” and “[a]gency heads are not required to amend, remove, or otherwise stop production of documents, products, or other services prepared or offered in languages other than English.” On January 31, 2025, E.O. 14192 was issued: “Unleashing Prosperity Through Deregulation” (hereinafter referred to as E.O. 14192).\57\ E.O. 14192 describes the Administration's policy goals to promote prudent financial management and alleviate unnecessary regulatory burdens. Section 2 of E.O. 14192 states that “it is the policy of the executive branch to be prudent and financially responsible in the expenditure of funds, from both public and private sources, and to alleviate unnecessary regulatory burdens placed on the American people.” Lastly, a recent memorandum from the Office of the Attorney General, released on July 14, 2025,\58\ provides guidance for compliance with E.O. 14224, but indicates that additional guidance will be forthcoming on compliance with Title VI. As CMS stated in the Contract Year 2027 proposed rule, to ensure consistency and reduce the risk of misalignment, CMS believes it is prudent to defer to OCR as to how this guidance will impact language assistance requirements under Title VI and Section 1557 throughout the programs under HHS's purview.\59\

\56\ https://www.whitehouse.gov/presidential-actions/2025/03/designating-english-as-the-official-language-of-the-united-states/.

\57\ https://www.whitehouse.gov/presidential-actions/2025/01/unleashing-prosperity-through-deregulation/.

\58\ https://www.justice.gov/opa/pr/justice-department-releases-guidance-implementing-president-trumps-executive-order.

\59\ As discussed later in this section, CMS imposes other language assistance (and auxiliary aid and service) requirements on such entities for programmatic reasons related to the operation of the Medicare program pursuant to its authority under the Social Security Act, and unrelated to nondiscrimination requirements imposed by Title VI or ACA Section 1557.

CMS inadvertently omitted references to cost plans from this proposal in the Contract Year 2027 proposed rule and notes that the intent was always for the proposal to rescind the NoA requirement to apply to cost plans pursuant to CMS's authority in section 1876(c)(3)(C) to regulate marketing by section 1876 cost plans and the authority in section 1876(i)(3)(D) to specify new section 1876 contract terms as the Secretary may find necessary and appropriate. It is also established at Sec. 417.428 that most of the marketing and communication regulations in subpart V of part 422, including the NoA requirement, also apply to section 1876 cost plans. Accordingly, the rescission of the NoA requirement applies to cost plans as well as MA organizations and Part D sponsors.

CMS's requirements under Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33) currently duplicate OCR requirements at 45 CFR 92.11. To ensure clarity, minimize administrative burden, and limit confusion for MA organizations, Part D sponsors, and cost plans, CMS proposed to eliminate CMS's NoA requirement under Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33) and to defer to OCR's requirements related to notification of language assistance services and auxiliary aids and services under 45 CFR 92.11. CMS stated that this would mitigate the potential for future misalignment and the need for additional modifications to CMS's requirements as policy evolves.

CMS historically has looked to OCR's language requirements when promulgating regulations for the MA and Part D programs with respect to civil rights and nondiscrimination. On May 18, 2016, OCR published the Nondiscrimination in Health Programs and Activities final rule (81 FR 31376), hereinafter referred to as the “2016

section 1557 final rule,” implementing the requirement that all covered entities--any health program or activity, any part of which receives Federal financial assistance (including credits, subsidies, or contracts of insurance), and any program or activity that is administered by an executive agency or any entity established under title I of the ACA (or amendments)--include taglines with all “significant communications.” On June 19, 2020, the Department of Health and Human Services (Department) published a new section 1557 final rule, “Nondiscrimination in Health and Health Education Programs or Activities, Delegation of Authority,” hereinafter referred to as the 2020 section 1557 final rule (85 FR 37160), rescinding the 2016 section 1557 final rule's tagline requirements (84 FR 27860).

To address the gap after the rescission of OCR's tagline requirements in the 2020 section 1557 final rule, CMS finalized an MLI requirement in the “Medicare Program; Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Programs; Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency; Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency” final rule (87 FR 27704), hereinafter referred to as the “May 2022 final rule.” CMS, at Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33), required the MLI to have a CMS-provided standardized tagline in the following languages: Spanish, Chinese, Tagalog, French, Vietnamese, German, Korean, Russian, Arabic, Italian, Portuguese, French Creole, Polish, Hindi, and Japanese. Additionally, the MLI required that MA organizations and Part D sponsors include additional languages in the plan's service area that met the five percent service area threshold, as required under Sec. Sec. 422.2267(a)(2) and 423.2267(a)(2). Sections 422.2267(a)(2) and 423.2267(a)(2) require that, for all required materials and content under Sec. Sec. 422.2267 and 423.2267, MA organizations and Part D sponsors must, “for markets with a significant non-English speaking population, be in the language of these individuals.” Specifically, MA organizations and Part D sponsors “must translate required materials into any non-English language that is the primary language of at least 5 percent of the individuals in a plan benefit package (PBP) service area.”

On August 4, 2022, OCR proposed a new rule, Nondiscrimination in Health Programs and Activities (hereinafter referred to as the “2022 proposed rule”) for section 1557 of the ACA (87 FR 47824), to require covered entities to notify the public of the availability of language assistance services and auxiliary aids and services for their health programs and activities at no cost using a NoA and requiring that OCR's NoA be provided in English and at least in the 15 most common languages spoken by individuals with limited English proficiency in the relevant State or States, and in alternate formats for individuals with disabilities who request auxiliary aids and services to ensure effective communications.\60\

\60\ The proposed rule was finalized, with minor modifications on May 6, 2024, (89 FR 37522), creating the requirements for the notice of the availability of language assistance services and auxiliary aids and services at 45 CFR 92.11.

To ensure consistency, following OCR's 2022 proposed rule, CMS finalized the current NoA in the “Medicare Program; Changes to the Medicare Advantage and the Medicare Prescription Drug Benefit Program for Contract Year 2024-Remaining Provisions and Contract Year 2025 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly (PACE)” final rule (89 FR 30448), hereinafter known as the “April 2024 final rule.” In this rule, CMS renamed the required document from the MLI to the notice of availability of language assistance services and auxiliary aids and services (Notice of Availability) at Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33) to align with OCR's language. Additionally, the notice was recategorized from a standardized communications material to a model communications material, requiring MA organizations and Part D sponsors to include in the notice that, at a minimum, they provide language assistance services and appropriate auxiliary aids and services free of charge (89 FR 30534). CMS's updated NoA also updated the language criteria to align with OCR's proposed language at the time. To align with OCR, CMS finalized the requirement for MA organizations and Part D sponsors to provide CMS's NoA “in English and at least the 15 languages most commonly spoken by individuals with limited English proficiency of the relevant State or States associated with the plan's service area and must be provided in alternate formats for individuals with disabilities who require auxiliary aids and services to ensure effective communication.” CMS maintained the requirement that CMS's NoA also include any non-English language that is the primary language of at least 5 percent of the individuals in a plan benefit package (PBP) service area, provided it was beyond the 15 languages most commonly spoken by individuals with limited English proficiency of the relevant State or States associated with the plan's service area. This update resulted in the potential for MA organizations and Part D sponsors to develop a NoA with more than 15 languages, exceeding OCR's requirements.

In the Contract Year 2027 proposed rule, CMS explained that while currently OCR's and CMS's requirements are mostly aligned, CMS noted minor differences in the language of the current regulations. The OCR NoA requirement applies to the “State or States in which a covered entity operates” which is broader than CMS's requirement. CMS explained that its NoA requirement applies to the “State or States associated with the plan's service area” which CMS defined as the plan benefit package level. Additionally, CMS requires its NoA to be included on all CMS required materials at Sec. Sec. 422.2267(e) and 423.2267(e), whereas OCR's language regarding where its NoA should be placed (45 CFR 92.11(c)(5)) is less specific, though its guidance still aligns with many of CMS's required materials.

As discussed in the April 2024 final rule, ACA Section 1557 (42 U.S.C. 18116(a)) provides that, except where otherwise provided in Title I of the ACA, an individual shall not, on the grounds prohibited under Title VI of the Civil Rights Act of 1964, 42 U.S.C. 2000d et seq. (race, color, or national origin), Title IX of the Education Amendments of 1972, 20 U.S.C. 1681 et seq. (sex), the Age Discrimination Act of 1975, 42 U.S.C. 6101 et seq. (age), or section 504 of the Rehabilitation Act of 1973, 29 U.S.C. 794 (disability), be excluded from participation in, be denied the benefits of, or be subjected to discrimination under, any health program or activity, any part of which is receiving Federal financial assistance (including credits, subsidies, or contracts of insurance); any program or activity administered by an Executive Agency; or any program or activity administered by any entity established under Title I of the Act or amendments.

In the April 2024 final rule, CMS cited discussions from the May 2022 final rule, that “solely relying on the requirements delineated in the 2020 section 1557 final rule for covered entities to convey the availability of interpreter services is insufficient for the MA, cost plan, and Part D programs

and is not in the best interest of Medicare beneficiaries who are evaluating whether to receive their Medicare benefits through these plans and who are enrolled in these plans” (89 FR 30529). At the time, CMS took the position that “informing Medicare beneficiaries that interpreter services are available is essential to realizing the value of our regulatory requirements for interpreter services” (89 FR 30529). CMS further explained that through additional insights “regarding the void created by the lack of any notification requirement associated with the availability of interpreter services for Medicare beneficiaries the materials required under Sec. Sec. 422.2267(e) and 423.2267(e) were vital to the beneficiary's decision- making process” (87 FR 27821). CMS also cited complaint tracking module (CTM) cases in the Health Plan Management System (HPMS) related to “language” and found a pattern of beneficiary confusion stemming from not fully understanding materials based on a language barrier.

In the April 2024 final rule, CMS also explained that updating CMS's NoA requirements in Parts C and D would help align with the Medicaid requirement under Sec. 438.10(d)(2), in which “States must require Medicaid managed care organizations (MCOs), prepaid inpatient health plans (PIHPs), prepaid ambulatory health plans (PAHPs), and primary care case management programs to include taglines in written materials that are critical to obtaining services for potential enrollees in the prevalent non-English languages in the State explaining the availability of oral interpretation to understand the information provided, information on how to request auxiliary aids and services, and the toll-free telephone number of the entity providing choice counseling services in the State” (89 FR 30529). Therefore, CMS finalized its NoA requirements that also aligned with Medicaid materials requirements, such as updating CMS's NoA to require the 15 most common languages in the State rather than the 15 most common languages nationally (89 FR 30529).

CMS stated in the Contract Year 2027 proposed rule that, while CMS's and OCR's current requirements are now mostly aligned, CMS was concerned that the duplicative nature of these requirements may potentially result in additional regulatory updates, and corresponding burdens as policy evolves. Because CMS and OCR regulatory schedules vary, the potential differences in requirements can be confusing and burdensome to MA organizations and Part D sponsors who are subject to CMS requirements and the broader OCR requirements as covered entities. Additionally, uncertainty regarding broad changes to language assistance and notification requirements, or how OCR may modify their requirements as policy evolves may result in additional confusion, administrative burden and potential for misalignment of CMS's NoA requirement under Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33). CMS stated that eliminating its NoA requirement under Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33) will ensure consistency and clarity for covered entities as these requirements will be addressed centrally by OCR under OCR's relevant authorities. CMS notes that dual eligible special needs plans (D-SNPs) would still be subject to any notice requirements that may be included in the state Medicaid agency contract or state statute for Medicaid as applicable. Overall, CMS's position in the Contract Year 2027 proposed rule was that eliminating the duplicative nature of OCR's and CMS's regulatory requirements supported the principles set forth in E.O. 14192 by promoting prudent financial management and alleviating unnecessary regulatory burdens.

In summary, removing Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33) reduces the potential for future confusion and administrative burden on CMS and MA organizations and Part D sponsors by eliminating duplicative requirements. CMS is not scoring this update in the COI section as CMS believes there will be no burden impacts for this update. In addition, this update is not expected to have any economic impact on the Medicare Trust Fund.

CMS reiterates that it is rescinding the CMS-specific NoA requirement promulgated pursuant to Title VI, to avoid duplication and potential misalignment as OCR Title VI policies evolve, but this policy, as finalized, will not reduce Medicare program protections related to language assistance and effective communication, promulgated for programmatic reasons related to the operation of the Medicare program pursuant to its authority under the Social Security Act. Even with the rescission of the CMS-specific NoA requirements at Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33), MA organizations, Part D sponsors, and cost plans remain subject to multiple Medicare program requirements that ensure meaningful access for individuals with limited English proficiency (LEP) and individuals with disabilities. For example, MA organizations, Part D sponsors, and cost plans must continue to provide interpreter services for non-English speaking and LEP individuals, including requirements related to interpreter availability and wait times for incoming calls, and that such services be available at no cost to the caller consistent with Sec. Sec. 422.111(h)(1)(iii), 423.128(d)(1)(iii), and 417.427. In addition, CMS's existing translation and accessibility standards for CMS-required materials and content remain in effect. Under Sec. Sec. 422.2267(a)(2) and 423.2267(a)(2), MA organizations, Part D sponsors, and cost plans must translate required materials into any non-English language that is the primary language of at least 5 percent of individuals in a plan benefit package service area, and under Sec. Sec. 422.2267(a)(3) and 423.2267(a)(3), upon request or when otherwise learning of an enrollee's primary language, provide non-English materials in any non- English language identified in Sec. Sec. 422.2267(a)(2), 423.2267(a)(2), 422.2267(a)(4), and 423.2267(a)(4), including the Annual Notice of Change (ANOC), Evidence of Coverage (EOC), Explanation of Benefits (EOB), Summary of Benefits (SB), and provider directories, among others.

CMS solicited comment on the proposed amendments and thanks commenters for their input. In the following section, CMS describes the comments received and CMS's corresponding responses.

Comment: Many commenters supported CMS's plan to rescind CMS's NoA requirement and suggested that this proposal would reduce administrative burden and costs for MA organizations and Part D sponsors while protecting against future misalignment between CMS and OCR's language access requirements. Commenters expressed support for eliminating duplicative requirements and centralizing oversight of language access requirements under OCR, with one commenter noting the importance of this, given forthcoming changes to language access requirements. They also noted that this rescission, while reducing administrative burden, would maintain beneficiary protections around language access. Multiple commenters cited the significant volume of notice requirements, which can be lengthy or confusing to enrollees, as further support for CMS to streamline notice requirements and reduce redundancy. One commenter noted the reduced burden from rescinding this notice could benefit small plans like special needs plans (SNPs).

Response: CMS thanks commenters for their support of this proposal. Because the provisions proposed to be rescinded relate only to the notice of

availability of language access services and auxiliary aids and services, CMS notes that CMS proposed to defer to OCR with respect to such requirements at 45 CFR 92.11, promulgated under Title VI, Section 504, and/or ACA Section 1557, and that it remains responsible for language assistance and auxiliary aids and services requirements promulgated for programmatic reasons related to the operation of the Medicare program pursuant to its authority under the Social Security Act.

Comment: Another commenter, though supportive of the rescission and greater efficiency, noted concern regarding the transition of these requirements to OCR's oversight and requested MA organizations and Part D sponsors receive timely and detailed guidance on future OCR oversight and clarifications on how OCR's requirement will differ from CMS's NoA requirements. The commenter also requested implementation timelines and coordination between CMS and OCR to prevent conflicting directives and clarification of any ongoing notice obligations for D-SNPs.

Response: CMS understands the commenter's concern about changing MA and Part D oversight and will share these concerns with OCR. CMS notes that OCR already has oversight of its NoA requirements, and that oversight will continue despite this final rule. OCR is the HHS component responsible for interpreting, implementing, overseeing and enforcing Title VI/ACA Section 1557 notice requirements related to language assistance.

Comment: The majority of commenters opposed this proposal and requested CMS maintain its NoA requirement, citing the importance of CMS's NoA in informing beneficiaries of their ability to access language assistance services, and auxiliary aids and services, at no cost to the beneficiary. Some commenters stated that beneficiaries with limited English proficiency (LEP) and those with disabilities rely on CMS's NoA as a safeguard for vulnerable populations. A few commenters expressed concern that rescinding CMS's NoA requirement would limit language access and, therefore, effective communication which could lead to worse health outcomes or result in expensive downstream consequences. These commenters were concerned that without the CMS NoA, beneficiaries will face greater barriers to care, with one commenter citing the already substantial barriers to care that beneficiaries with limited English proficiency may face. Another commenter was concerned that without CMS's NoA, enrollees will not be aware of these services for enrollees with LEP or disabilities. Lastly, a commenter noted that CMS's NoA helps reduce burden on community-based organizations with limited resources.

Response: CMS thanks commenters for their thoughts and acknowledges these concerns. However, the Agency wants to emphasize that MA organizations and Part D sponsors will still be required to provide OCR's NoA as required by 45 CFR 92.11 and Medicaid regulations at Sec. 438.10(d)(2), as applicable. As stated earlier, CMS is proposing to rescind CMS's NoA to ensure clarity, minimize administrative burden, and limit confusion for MA organizations and Part D sponsors. Under OCR's requirements, beneficiaries will continue to receive the appropriate notices. Deferring to OCR's oversight, management, and enforcement of Title VI, Section 504, and/or ACA Section 1557 with respect to such notice requirements as required by 45 CFR 92.11, related to language assistance services and auxiliary aids and services, would also mitigate the potential for future misalignment and the need for additional modifications to CMS's Title VI, Section 504, and/or ACA Section 1557 requirements as policy evolves. Moreover, CMS has other language-based requirements, promulgated for programmatic reasons related to the operation of the Medicare program pursuant to its authority under the Social Security Act, that remain in effect that provide a level of protection to non-English speaking beneficiaries. Under Sec. Sec. 422.2267(a)(2) and 423.2267(a)(2), for example, MA organizations and Part D sponsors must translate required materials into any non-English language that is the primary language of at least 5 percent of individuals in a plan benefit package service area, and under Sec. Sec. 422.2267(a)(3) and 423.2267(a)(3), upon request or when otherwise learning of an enrollee's primary language, provide non- English materials in any non-English language identified in Sec. Sec. 422.2267(a)(2), 423.2267(a)(2), 422.2267(a)(4), and 423.2267(a)(4).

Comment: A few commenters had specific concerns about deferring oversight to OCR's NoA requirements, with commenters claiming OCR has a limited capacity, due to low staffing, to properly oversee these requirements or that there could be enforcement gaps. Commenters articulated concern that the lack of clear oversight or protection could harm beneficiaries or lead to ineffective oversight and that reducing CMS oversight may mean MA organizations and Part D sponsors are less inclined to provide these notifications. Another commenter noted that, while appreciative of CMS's goal to mitigate future misalignment, they were concerned that this change would create more confusion, without additional benefit for beneficiaries. Furthermore, this commenter recommended CMS communicate changes to OCR guidance through HPMS and continue streamlining requirements. Another commenter requested that CMS not defer oversight and management to OCR until clear, enforceable mechanisms are in place to ensure enforcement.

Response: CMS appreciates commenters' thoughts. However, CMS reiterates that OCR is the HHS component responsible for interpreting, implementing, overseeing, and enforcing Title VI, Section 504, and/or ACA Section 1557 requirements related to notification for language assistance services and auxiliary aids and services at 45 CFR 92.11. Rescinding CMS's NoA requirement will assist MA organizations and Part D sponsors and beneficiaries in removing duplicative requirements that could result in potential confusion for beneficiaries and unnecessary administrative burden, including the need to ensure compliance with both CMS and OCR NoA requirements. Moreover, CMS has other language- based requirements, promulgated for programmatic reasons related to the operation of the Medicare program pursuant to its authority under the Social Security Act, that remain in effect that provide a level of protection to non-English speaking beneficiaries. Under Sec. Sec. 422.2267(a)(2) and 423.2267(a)(2), for example, MA organizations and Part D sponsors must translate required materials into any non-English language that is the primary language of at least 5 percent of individuals in a plan benefit package service area, and under Sec. Sec. 422.2267(a)(3) and 423.2267(a)(3), upon request or when otherwise learning of an enrollee's primary language, provide non- English materials in any non-English language identified in Sec. Sec. 422.2267(a)(2), 423.2267(a)(2), 422.2267(a)(4), and 423.2267(a)(4).

Comment: A few commenters expressed concern about limitations to civil rights and that this proposal will harm Americans with disabilities and individuals with LEP. A commenter disagreed with CMS's rationale that CMS and OCR's requirements are duplicative or confusing and instead believes that these requirements work together to promote effective communication. This commenter added that removing CMS's requirement eliminates CMS's monitoring capacity

in its complaint tracking system. An additional commenter disagreed with CMS that CMS's NoA is duplicative with OCR's requirements, arguing that it provides clear directions to MA organizations and Part D sponsors within the Medicare context. Another commenter was concerned administrative burden would shift from MA organizations and Part D sponsors to beneficiaries and providers.

Response: CMS understands commenters' concerns but reiterates that OCR is the HHS component responsible for implementation of Title VI, Section 504, and/or ACA Section 1557 requirements and that CMS is proposing to rescind CMS's NoA due to its duplicative nature and to streamline oversight of notice requirements as required by 45 CFR 92.11 under OCR. Rescinding CMS's NoA does not limit CMS's ability to monitor relevant complaints, and MA organizations and Part D sponsors will still be responsible under their CMS contracts to follow all applicable federal rules and regulations. As previously stated, CMS has other language-based requirements, promulgated for programmatic reasons related to the operation of the Medicare program pursuant to its authority under the Social Security Act, that remain in effect that provide a level of protection to non-English speaking beneficiaries. Under Sec. Sec. 422.2267(a)(2) and 423.2267(a)(2), for example, MA organizations and Part D sponsors must translate required materials into any non-English language that is the primary language of at least 5 percent of individuals in a plan benefit package service area, and under Sec. Sec. 422.2267(a)(3) and 423.2267(a)(3), upon request or when otherwise learning of an enrollee's primary language, provide non- English materials in any non-English language identified in Sec. Sec. 422.2267(a)(2), 423.2267(a)(2), 422.2267(a)(4), and 423.2267(a)(4).

Comment: Several commenters expressed concern with deferring to OCR requirements, arguing that those are broader and less specific to Medicare populations. A few commenters noted that MA and Part D requirements are more explicit and supportive of Medicare beneficiaries than OCR's requirements. A commenter noted that the current CMS NoA requirements are clear and prescriptive, requiring CMS's NoA to be included on all CMS required documents, which promotes clarity and consistency for operations and compliance. The commenter explained that while some of the OCR's NoA categories are straightforward, others are subjective and require detailed, document-level interpretation which MA organizations and Part D sponsors would be required to evaluate for all CMS required documents. Another commenter expressed concern that certain CMS-required materials, such as the Mid-Year Change Notifications, Star Ratings Document, and Federal Contracting Statement, would not include the NoA under OCR's requirements. Another commenter requested CMS collaborate with OCR to limit the number of required communications OCR's NoA must be included in, arguing costly printing and a poor enrollee experience and recommended that CMS require the inclusion of the NoA in the Annual Notice of Change (ANOC), Evidence of Coverage (EOC), Explanation of Benefits (EOB), and Summary of Benefits documents.

Response: CMS understands commenters' concerns regarding the minor differences in OCR and CMS's current NoA requirements. However, CMS notes that language access notification requirements have historically been updated based on OCR's language access requirements. Most recently, in the April 2024 final rule, CMS updated its notice requirements from the MLI to the NoA to align with proposed changes to OCR's language access notifications. Furthermore, OCR is the HHS component responsible for implementing and enforcing the HHS civil rights regulations at Section 1557 and 45 CFR 92.11 and their requirements currently include many pertinent and important materials. CMS disagrees with commenters that OCR's requirements are less specific to Medicare beneficiaries or less detailed than CMS's requirements. Some examples, as listed in OCR requirements at 45 CFR 92.11(c)(5), include that the NoA is required to be included on application and intake forms, and communications related to an individual's rights, eligibility, benefits, or services that require or request a response from a participant, beneficiary, enrollee, or applicant. OCR also requires the NoA to be provided annually to participants, beneficiaries, enrollees (including late and special enrollees), and applicants of a covered entity's health program or activity, per 45 CFR 92.11(c)(1), and upon request, per 45 CFR 92.11(c)(2). To streamline regulatory processes and limit duplicative guidance and enforcement, deferring to OCR with respect to Title VI, Section 504, and/or ACA Section 1557 requirements related to notification for language assistance services and auxiliary aids and services, as required by 45 CFR 92.11, will ensure MA organizations and Part D sponsors have clear guidance on civil rights requirements. CMS notes that, although the OCR requirements do not specifically define the applicable CMS materials, OCR's NoA requirements provide clear instructions on which materials should include OCR's NoA,

Comment: Many commenters shared concerns that OCR's NoA requirement does not include the CMS requirement at Sec. Sec. 422.2267(e)(31)(ii)(B) and 423.2267(e)(33)(ii)(B) that CMS's NoA be provided in additional languages if there are additional languages in a particular service area that meet the five percent service area threshold beyond the languages described in Sec. Sec. 422.2267(e)(31)(i) or 423.2267(e)(33)(i), and that CMS's NoA must also be translated into those languages. One commenter was concerned about the impact on local populations with LEP that may no longer receive notices in their primary language, leading to barriers to coverage.

Response: CMS understands commenters' concern regarding the five percent service area threshold. CMS notes that while the OCR requirement does not include this additional five percent service area threshold requirement, OCR's current requirement at 45 CFR 92.11(b) requires “at least the 15 languages most commonly spoken by individuals with limited English proficiency of the relevant State or States in which a covered entity operates.” MA organizations and Part D sponsors are permitted to include additional languages in OCR's NoA beyond this requirement. Furthermore, under CMS requirements at Sec. Sec. 422.2267(a)(2) and 423.2267(a)(2), for all required materials and content under Sec. Sec. 422.2267 and 423.2267, MA organizations and Part D sponsors must, “[f]or markets with a significant non-English speaking population, be in the language of these individuals.” Specifically, MA organizations and Part D sponsors “must translate required materials into any non-English language that is the primary language of at least 5 percent of the individuals in a plan benefit package (PBP) service area,” and under Sec. Sec. 422.2267(a)(3) and 423.2267(a)(3), upon request or when otherwise learning of an enrollee's primary language, provide non-English materials in any non-English language identified in Sec. Sec. 422.2267(a)(2), 423.2267(a)(2), 422.2267(a)(4), and 423.2267(a)(4). These requirements are also applicable to cost plans pursuant to Sec. 417.428.

Comment: A few commenters who opposed this proposal had concerns

about how this rescission would impact MA organizations and Part D sponsors. A commenter expressed concern the proposal would result in MA organizations and Part D sponsors needing to hire more translators, increased call center volume and a re-allocation of resources to address these changes, which would disproportionally impact smaller MA organizations and Part D sponsors. Another commenter, while appreciative of the effort to streamline communication requirements, was concerned the proposal would inadvertently create increased complexity and introduce additional compliance risks for MA organizations and Part D sponsors. Another commenter recommended CMS revert to CMS' MLI requirement, arguing that the language requirement to include the top 15 non-English languages nationally was less burdensome to MA organizations and Part D sponsors, less costly and better for beneficiaries.

Response: CMS maintains the position that the duplicative nature of these requirements may result in potential confusion and burden for MA organizations and Part D sponsors and beneficiaries as well as resulting in additional regulatory updates, and corresponding burdens as policy evolves. While CMS understands concerns regarding adapting to the requirements, CMS notes that OCR currently oversees its Title VI, Section 504, and/or ACA Section 1557 NoA requirements. Under this proposal, CMS is solely removing a duplicative requirement and deferring to OCR, the agency responsible for implementing these civil rights requirements at 45 CFR 92.11. Additionally, CMS believes that MA organizations and Part D sponsors will benefit from more centralized and streamlined civil rights guidance, especially those organizations whose operations include more insurance products than Medicare Advantage and Medicare prescription drug plans.

Comment: A few commenters highlighted the impact on SNPs and their enrollees, citing the potential for regulatory inconsistency. One commenter noted that, for D-SNPs, coordination with state Medicaid requirements is still applicable and that rescinding the NoA could create problems with enrollment in D-SNPs, who would still be subject to notice requirements in the State Medicaid Agency Contract (SMAC) or State statute. Another commenter noted while CMS's NoA requirement will exist for D-SNPs, for non-D-SNPs, beneficiaries could be harmed in their ability to fully understand and comprehend complex information.

Response: CMS acknowledges that D-SNPs would still be required to follow the Medicaid requirement under Sec. 438.10(d)(2), as described above. By removing the NoA requirements under Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33), D-SNPs will only need to consider applicable Medicaid and OCR language access notification requirements, which CMS believes will reduce the administrative burden on D-SNPs of complying with MA and Part D, Medicaid and OCR notification requirements concerning language access services and auxiliary aids and services.

Comment: A couple of commenters praised the current CMS NoA requirement burden reduction, by allowing MA organizations and Part D sponsors at Sec. Sec. 422.2267(e)(31)(ii)(F) and 423.2267(e)(33)(ii)(F), to only provide one notice when mailing multiple required materials together. One commenter noted OCR does not have this requirement, which may result in a higher volume of mail and redundancy for MA organizations, Part D sponsors, and enrollees.

Response: CMS appreciates commenters' insight on the benefits of mailing one notice with multiple required materials. In alignment with CMS's rationale to reduce duplication, CMS's goal with this proposal is to further streamline requirements for MA organizations and Part D sponsors and to prevent beneficiaries being inundated with duplicative notices. OCR's regulations implementing section 1557 of the Affordable Care Act separately require recipients of Federal financial assistance, such as MA organizations and Part D sponsors, to provide an NoA in certain circumstances as set forth in 45 CFR 92.11, including in specified electronic and written communications listed under Sec. 92.11(c)(5). CMS notes that while OCR's requirements do not explicitly permit MA organizations and Part D sponsors to provide one notice when mailing multiple required materials as in Sec. Sec. 422.2267(e)(31)(ii)(F) and 423.2267(e)(33)(ii)(F), doing so is not explicitly prohibited by OCR's requirements at 45 CFR 92.11.

Comment: One commenter argued that CMS did not provide a sufficient rationale for why previously cited concerns about language barriers for beneficiaries are outweighed by potentially confusing regulations for MA organizations and Part D sponsors. Another commenter disagreed with CMS that OCR's requirement was duplicative, citing CMS's rationale in the April 2024 final rule that OCR's requirements were insufficient to protect beneficiaries and stated that CMS has not provided a rationale to reverse these statements.

Response: As noted in the Contract Year 2027 proposed rule, eliminating CMS's NoA requirement under Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33) will ensure consistency and clarity for covered entities as any Title VI language access services and Section 504 auxiliary aids and services notification requirements required by 45 CFR 92.11 will be addressed by OCR, which is responsible for enforcing civil rights laws with respect to HHS programs. OCR is the HHS component that implements and enforces civil rights requirements, and CMS will defer to OCR's oversight, management, and enforcement of any Title VI, Section 504, and/or ACA Section 1557 requirements related to notification for language assistance services and auxiliary aids and services at 45 CFR 92.11. Regarding CMS's previous rationale, in the April 2024 final rule, CMS referenced the discussion from the May 2022 final rule that “relying on the requirements delineated in the 2020 section 1557 final rule for covered entities to convey the availability of interpreter services is insufficient.” \61\ In OCR's 2020 section 1557 final rule, they rescinded their language access notification requirements, known as “taglines.” Since that time, in May 2024, OCR finalized new rules implementing their NoA requirements,\62\ after proposing these changes in their 2022 section 1557 proposed rule.\63\ CMS had already updated its NoA requirements in the April 2024 final rule to align its requirements with OCR's based on OCR's 2022 section 1557 proposed rule. While these requirements are now aligned, CMS is concerned about the redundancy of these requirements and is taking the prudent step to defer to OCR for oversight of Title VI and/or ACA Section 1557 language access requirements at 45 CFR 92.11. CMS reiterates that it has other language-based requirements, promulgated for programmatic reasons related to the operation of the Medicare program pursuant to its authority under the Social Security Act, that remain in effect that provide a level of protection to non-English speaking beneficiaries. Under Sec. Sec. 422.2267(a)(2) and 423.2267(a)(2), for example, MA organizations and Part D sponsors must translate required materials into any non-English language that is the primary language of at least 5 percent of individuals in a plan

benefit package service area, and under Sec. Sec. 422.2267(a)(3) and 423.2267(a)(3), upon request or when otherwise learning of an enrollee's primary language, provide non-English materials in any non- English language identified in Sec. Sec. 422.2267(a)(2), 423.2267(a)(2), 422.2267(a)(4), and 423.2267(a)(4).

\61\ 89 FR 30529

\62\ 89 FR 37522

\63\ 87 FR 47824

Comment: One commenter described the legal foundation for the requirement for covered entities to notify individuals of the availability of language assistance services, citing Title VI of the Civil Rights Act of 1964, Section 1557 of the Affordable Care Act, and the implementing regulations at 45 CFR 92.11. The commenter stated that these statutory requirements cannot be overridden by executive orders, and that they cannot nullify civil rights protections established by statute. The commenter noted that the July 2025 Attorney General memorandum cited by CMS does not eliminate Section 1557 requirements and argued that these legal requirements exist because meaningful access to healthcare services requires that individuals first know that language assistance is available to them.

Response: CMS clarifies that rescinding the CMS required NoA should not be construed as the Agency taking a position on the laws and regulations cited by the commenter. Rather, CMS's decision to rescind CMS's NoA requirements under Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33) is due to concerns previously expressed in this preamble, including the duplicative nature of CMS and OCR's requirements and the corresponding burden placed on MA organizations and Part D sponsors to ensure compliance with NoA requirements from CMS and OCR. OCR is also the HHS component responsible for implementing and enforcing Title VI, Section 504, and/or ACA Section 1557 notice requirements as required by 45 CFR 92.11. CMS has other language-based requirements, promulgated for programmatic reasons related to the operation of the Medicare program pursuant to its authority under the Social Security Act, that remain in effect that provide a level of protection to non-English speaking beneficiaries. Under Sec. Sec. 422.2267(a)(2) and 423.2267(a)(2), for example, MA organizations and Part D sponsors must translate required materials into any non-English language that is the primary language of at least 5 percent of individuals in a plan benefit package service area, and under Sec. Sec. 422.2267(a)(3) and 423.2267(a)(3), upon request or when otherwise learning of an enrollee's primary language, provide non- English materials in any non-English language identified in Sec. Sec. 422.2267(a)(2), 423.2267(a)(2), 422.2267(a)(4), and 423.2267(a)(4).

After considering the comments received and for the reasons outlined in the Contract Year 2027 proposed rule and in responses to public comments, CMS is finalizing the rescission of CMS's NoA requirements at Sec. Sec. 422.2267(e)(31) and 423.2267(e)(33) as proposed.