State RegulationsOH specificDifficulty 2/5
An issuer designs its Medicare supplement marketing so that producers receive a reduced commission on applications submitted during the Medicare supplement open enrollment period, hoping producers will steer those applicants elsewhere. What does Ohio law provide?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under the Medicare supplement marketing standards in OAC 3901-8-08, issuers may not discourage open-enrollment sales, and compensation structures must not disadvantage open enrollees. A commission reduction aimed at steering producers away from open-enrollment applicants is precisely the practice the rule prohibits. Open enrollees must receive the same access to plans and producers as anyone else.
Why the other options are wrong
- A) Disclosure in the outline of coverage does not authorize a compensation practice that disadvantages open-enrollment sales.
- C) Medicare supplement marketing and compensation practices are expressly regulated in Ohio; commission structures that discourage open enrollment are barred.
- D) An annual data report to the Ohio Department of Insurance does not license a prohibited compensation structure.
Memory hook
Open enrollment sales cannot be disincentivized by pay cuts.