State Insurance Departments Examine Medicare Advantage Compliance

Since the publication from Epstein Becker & Green, P.C. on November 19, 2025, significant developments have unfolded concerning state insurance departments' examination of trade practices in Medicare Advantage (MA) and Medigap (MedSupp) policies. This update provides insights into the recent actions exploring the regulatory compliance requirements these policies face.

In late 2025, insurance departments from six states released statements on the enrollment and marketing practices of MA and MedSupp carriers. The states labeled these practices as "unfair and deceptive" under state regulations but did not consider federal preemption principles. Under current Medicare laws, federal regulations generally take precedence over state efforts to control Medicare Advantage, except in areas like licensure and solvency. Therefore, the legal implications of the states' declarations remain uncertain.

Notably, the Idaho Department of Insurance issued cease-and-desist orders to two carriers, citing violations of state laws, prompting legal responses from the carriers in Idaho's federal district court. They sought to challenge these regulatory actions, asserting federal law preempts state attempts to regulate Medicare Advantage plans. In December, the Idaho district court issued a temporary restraining order against the Department's actions, indicating UnitedHealthcare of the Rockies may prevail in its preemption claim.

In parallel, the Centers for Medicare & Medicaid Services (CMS) issued a statement on December 4, 2025, aligning with the court's perspective. CMS expressed that federal regulations likely override state laws regarding agent and broker compensation, communication, marketing requirements, and enrollment standards. The outcomes of this unresolved situation hinge on forthcoming court decisions.

In the meantime, it is crucial for MA carriers, alongside their brokers, agents, and partners, to evaluate compensation strategies, marketing methodologies, and enrollment processes. Industry participants should ensure compliance with both state regulations and the MA enrollment framework to navigate this complex regulatory landscape effectively.