The Ripple Effect: How 2025 AEP Broker Commission Cuts Could Impact Medicare Advantage Members

In a strategic yet unsurprising move, Elevance Health and Aetna have joined Centene in cutting broker compensation on certain Medicare Advantage (MA) plans, aiming to control costs. This shift, rolled out in the midst of the Annual Enrollment Period (AEP), raises questions about its effects on members who rely on brokers for guidance in selecting their healthcare plans. The impact of this change is not just financial—it touches on member access to information, support, and overall experience.

Why Are Medicare Plans Cutting Broker Commissions?

The primary driver behind the decision to cut broker commissions is cost control. Medicare Advantage plans, particularly those with generous supplemental benefits like dental, vision, hearing, and over-the-counter (OTC) allowances, face high utilization rates. These popular benefits have been critical in attracting members, but as they become widely used, they drive up costs significantly. For MA plans, finding a balance between robust benefit offerings and sustainable costs is critical, especially under Medical Loss Ratio (MLR) regulations that cap administrative and profit-related spending.

For these plans, balancing costs is essential, especially with regulatory MLR requirements that dictate how much of a plan's revenue must go toward member care versus administrative costs or profits. By removing broker commissions, plans hope to reduce spending without directly slashing member benefits – but that doesn’t mean members won’t feel an impact.

The combination of spiraling MLRs, high utilization, and the headwinds from the Inflation Reduction Act and Star ratings leaves plans little choice in maintaining benefit offerings and profitability.

What Does This Mean for Members?

This shift in strategy could bring several challenges and potential frustrations for members. Removing broker compensation isn’t just a financial change for brokers—it has real, tangible impacts for members, including reduced access to guidance, increased pressure to switch plans, selecting plans that are not best for their needs, and less post-enrollment support.

Brokers have long served as a trusted resource for members, guiding them through plan options based on their individual needs. With the removal of commissions on certain plans, brokers will avoid these non-commissionable plans, reducing members’ access to expert support. Members interested in these plans may find it harder to get clear, unbiased information, which could complicate their decision-making during the already challenging AEP. Furthermore, members may miss out on plans that are better suited to their needs, simply because brokers are not promoting them.

Many brokers provide continued support to members throughout the year, helping them navigate questions about benefits, claims, and more. But without an incentive tied to these specific plans, brokers may reduce their level of service – or even stop servicing members in non-commissionable plans altogether. This could leave members, especially those who rely on DSNPs or other support-intensive plans, feeling left out and underserved.

The reduction in broker support could lead to frustration for members who suddenly feel they have nowhere to turn. Members who struggle to get answers or feel they were misled may resort to filing complaints with CMS. As more members face challenges navigating their benefits without broker assistance, complaints may rise, impacting not only members but also the Medicare Advantage plans’ standing with CMS.

Opportunities for Regional Carriers to Fill the Gaps

As AEP approached, there was already speculation about the impact of anticipated plan non-renewals and benefit reductions from carriers like Aetna and Humana. Another possible side effect of national carriers’ decision to reduce broker compensation is the opening it creates for regional and smaller carriers to step in. These carriers may offer attractive benefits and be able to incentivize brokers to bring members their way. For members, this could mean a broader range of options, but it also comes with the possibility of mixed experiences, as smaller carriers may have varying levels of resources for member support and may inadvertently put them in similar financial challenges national players are encountering.

Looking Forward: How Non-Commissioned Strategies Could Reshape Medicare Advantage

The shift to non-commissioned MA plans is creating a new precedent that could reshape the industry. With no end in sight to the financial challenges MA plans are facing, nothing is off the table in terms of strategies for financial sustainability. The potential impact to the broker and carrier relationship is yet to be seen. While this change may help MA carriers control costs, it places the burden on some members to navigate their options without traditional broker support.