Medicare Referral Compliance: What Can Agents Do And Not Do?

Referrals help keep your doors open. It’s natural to want to reward your happy clients for bringing in new prospects, but what does CMS have to say about gifts? And how do you speak with these new prospects? Read on to learn more about the limits of referrals, gifting and more as a Medicare agent.

What are the rules for gifts?

Marketing events can serve as a draw for your prospects, while increasing your visibility in the community and among your target audience. You might be tempted to impress by dipping into your marketing budget and lavishing gifts upon your attendees. Be careful! The Centers for Medicare and Medicaid Services (CMS) has rules that govern how generous you can be when gifting for marketing purposes.

You are allowed to give out nominal gifts, which amount to $15 per person. Over a year’s time, you cannot gift one person more than $75 worth of nominal gifts. There are also rules telling you what can and cannot be a gift. Meals cannot be gifts, which is why you are limited to serving light snacks and refreshments when you host a marketing event for Medicare prospects. You also cannot gift cash or rebates.

If you choose to offer a larger gift as a prize at an event, you have to limit its value to $15 times the number of people attending the event.

How do I communicate with prospects?

This is important. When it comes to Medicare referral compliance, you have to be very clear with the people handing out referrals: prospects must contact you first. You cannot call them or attempt to contact them before they have communicated with you directly. Otherwise, CMS will see this as unsolicited telephonic communication.

Encourage the happy clients who give you referrals to tell the prospect to call you. You can simplify this process and make it easier on your clients by providing them with personalized referral cards. Make these the same way you produce your business cards, and add the client’s name on the back, prominently stating “referred by ___ ___.”

How can Medicare agents get referrals?

Your most satisfied clients will be the ones most likely to speak for your services. Ask them if they would be willing to provide a testimonial or write a review for your online presence. From there, you will have the ball rolling to ask for referrals. Do not promise any gifts for referrals.

Remember, you cannot write down names a client gives you. Use the referral card system to have the prospect contact you personally before documenting any names.

The CMS Revised Medicare Communications and Marketing Guide can give you the answers to lingering questions about referrals as a Medicare agent. Refer to the guide or collaborate with the team at Magellan Healthcare to learn the ins and outs of successful sales techniques.