Department of Health and Human Services

OFFICE OF 

INSPECTOR GENERAL 

M A
EDICARE  DVANTAGE 

M M
ARKETING  ATERIALS FOR 

C Y 2005 

ALENDAR  EAR 
Daniel R. Levinson

Inspector General 

August 2006

OEI-01-05-00130
 Office of Inspector General 
http://oig.hhs.gov 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 
amended, is to protect the integrity of the Department of Health and Human Services (HHS) 
programs, as well as the health and welfare of beneficiaries served by those programs. This 
statutory mission is carried out through a nationwide network of audits, investigations, and 
inspections conducted by the following operating components: 
Office of Audit Services 
The Office of Audit Services (OAS) provides all auditing services for HHS, either by conducting 
audits with its own audit resources or by overseeing audit work done by others.  Audits 
examine the performance of HHS programs and/or its grantees and contractors in carrying out 
their respective responsibilities and are intended to provide independent assessments of HHS 
programs and operations.  These assessments help reduce waste, abuse, and mismanagement 
and promote economy and efficiency throughout HHS. 
Office of Evaluation and Inspections 
The Office of Evaluation and Inspections (OEI) conducts management and program evaluations 
(called inspections) that focus on issues of concern to HHS, Congress, and the public.  The 
findings and recommendations contained in the inspections generate rapid, accurate, and up-to-
date information on the efficiency, vulnerability, and effectiveness of departmental programs.  
OEI also oversees State Medicaid Fraud Control Units, which investigate and prosecute fraud 
and patient abuse in the Medicaid program. 
Office of Investigations 
The Office of Investigations (OI) conducts criminal, civil, and administrative investigations of 
allegations of wrongdoing in HHS programs or to HHS beneficiaries and of unjust enrichment 
by providers.  The investigative efforts of OI lead to criminal convictions, administrative 
sanctions, or civil monetary penalties.  
Office of Counsel to the Inspector General 
The Office of Counsel to the Inspector General (OCIG) provides general legal services to OIG, 
rendering advice and opinions on HHS programs and operations and providing all legal support in 
OIGs internal operations. OCIG imposes program exclusions and civil monetary penalties on 
health care providers and litigates those actions within HHS.  OCIG also represents OIG in the 
global settlement of cases arising under the Civil False Claims Act, develops and monitors 
corporate integrity agreements, develops compliance program guidances, renders advisory 
opinions on OIG sanctions to the health care community, and issues fraud alerts and other 
industry guidance.  E X E C U T I V E   S U M M A R Y
  E X E C U T I V E   S U M M A R Y  

OBJECTIVE 
To determine whether Medicare Advantage marketing materials for 
2005 met the Centers for Medicare & Medicaid Services (CMS) 
marketing requirements. 
BACKGROUND 
The Medicare Prescription Drug, Improvement, and Modernization Act 
of 2003 (P.L. 108-173), referred to as the MMA, expands the availability 
of managed care options through a revised managed care program, 
Medicare Advantage (MA).  MA organizations recruit beneficiaries 
using a variety of marketing materials.  These materials can be grouped 
into two broad categories: advertising materials and enrollment 
materials (i.e., sales brochures, enrollment forms, summaries of 
benefits, and evidence of coverage documents).  MA organizations 
generate sections of their plans summaries of benefits using CMSs 
Health Plan Management System (HPMS), which CMS also uses to 
track marketing materials.   
CMSs Managed Care Manual includes standards that MA marketing 
materials must meet to obtain CMSs approval.  These requirements, 
last updated in August 2004, address such aspects of marketing 
materials as premium costs, required definitions, benefit descriptions, 
prescription drug benefit descriptions, and required contact information. 
We reviewed marketing materials for January through December 2005 
from a random sample of 36 MA plans.  We did not review marketing 
materials for Medicare Part D plans because Part D did not begin until 
January 1, 2006. While our sample was randomly drawn, it was not 
large enough to produce reliable estimates of the population of plans.  
Using standard protocols that we developed based on CMSs Managed 
Care Manual, we reviewed advertisements, sales brochures, enrollment 
forms, summaries of benefits, and evidence of coverage documents from 
the 36 MA plans. We also interviewed staff at four CMS regional offices 
responsible for reviewing a large number of marketing materials from 
MA plans. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  i  EE XX EE CC UU TT II VV EE    SS UU MM MM AA RR YY

FINDINGS 
Some marketing materials in our sample lacked CMS-required 
information concerning limitations to prescription drug benefits. 
 	Fifty-five percent of summaries of benefits did not state that 
formulary contents can change. 
 	Eighteen percent of evidence of coverage documents did not specify 
that beneficiaries can use the appeals process to have drugs added 
to the plans formulary or to appeal a decision not to cover a 
particular drug. 
 	Ten percent of advertisements did not identify coverage limitations 
when referring to prescription drug benefits. 
Some marketing materials in our sample lacked elements required 
by CMS to ensure that beneficiaries can access plan information. 
 	Fifty-two percent of advertisements did not provide operating hours 
for their customer service numbers. 
 	Sixty-seven percent of summaries of benefits and 8 percent of 
evidence of coverage documents did not indicate that 
1-800-MEDICARE operates 24 hours a day, 7 days a week. 
Moreover, this information was missing from the sections of the 
summaries of benefits that MA plans generate from HPMS. 
 	Ten percent of advertisements failed to present text telephone 
numbers for individuals with hearing impairments in the same font 
size and style as other phone numbers. 
 	Twenty-eight percent of advertisements inviting beneficiaries to 
sales presentations failed to indicate that special arrangements 
could be made at these events for persons with special needs. 
 	Thirty-nine percent of evidence of coverage documents did not 
indicate that individuals with special needs could obtain the 
document in alternative formats. 
Some marketing materials in our sample did not clearly convey 
information concerning other aspects of MA plan coverage. 
 	Twenty-eight percent of summaries of benefits did not define the 
term benefit period when using the term to describe their plan. 
OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  ii  E X E C U T I V E   S U M M A R Y  
 	Thirty-six percent of summaries of benefits did not state that the 
plans contract with CMS is renewed annually and that nonrenewal 
could result in loss of coverage.   
 	Nineteen percent of enrollment forms and 14 percent of evidence of 
coverage documents contained technical language.  Eleven percent 
of both enrollment forms and evidence of coverage documents 
contained unclear language. 
CONCLUSION 
Our review found that some Medicare Advantage marketing materials 
lacked CMS-required information essential for beneficiaries to make 
informed plan choices. Missing information concerned prescription drug 
benefit limitations and details that convey how beneficiaries can access 
plan information.  Furthermore, some marketing materials used 
unclear and technical language. 
CMSs continued diligence in reviewing marketing materials is 
essential.  CMS will also need to ensure consistency between its HPMS 
system and its requirements for marketing materials.  We will continue 
to monitor marketing materials for Medicare Advantage plans and for 
Medicare Part D plans, as well as CMSs oversight of the review process 
for these materials.   
AGENCY COMMENTS 
CMS concurred with our findings, stating that the report will help it 
improve its marketing review process.  CMS also highlighted 
enhancements it made to the review process for Medicare Advantage 
and Medicare Part D plan marketing materials to improve their 
consistency.  These include a consolidated review of Medicare 
Advantage and Medicare Part D plan marketing materials by CMS 
regional office staff, a contractor review of the consistency of marketing 
materials, and new features in its HPMS system to assist in monitoring 
the review process. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  iii    T A B L E   O F   C O N T E N T S  

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i

I N T RO DUC T IO N  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1

F I N D IN G S  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  5

Some materials lack prescription drug benefit limitations. . . . . . .  5

Some materials lack elements needed to access plan information .  6 

Some materials do not clearly convey coverage information. . . . . .  8

CONC LUSION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  12

Agency Comments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  12

E N D NO T ES  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13

APPENDIXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  15

A:  Methodology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  15

B:  AgencyComments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  18

A C K NO WL E D G M E N T S  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22
   I N T R O D U C T I O N  

OBJECTIVE 
To determine whether Medicare Advantage marketing materials for 
2005 met the Centers for Medicare & Medicaid Services (CMS) 
marketing requirements. 
BACKGROUND 
Medicare Managed Care  
The Medicare Prescription Drug, Improvement, and Modernization Act 
of 2003 (P.L. 108-173), referred to as the MMA, revised the managed 
care program and expanded the availability of managed care options for 
Medicare beneficiaries. The MMA renamed the revised managed care 
program Medicare Advantage (MA). This program took effect 
March 22, 2005.1 
The MA encompasses multiple forms of Medicare managed care. As of 
January 2005, approximately 5.4 million Medicare beneficiaries were 
enrolled in managed care plans.  Roughly 4.7 million, or 85 percent, of 
these beneficiaries received services through 143 health maintenance 
organizations, hereafter referred to as MA organizations.2 Each MA 
organization may offer multiple plans. 
We evaluated materials that MA organizations distributed to market 
their plans for calendar year 2005. These plans operated prior to 
implementation of the Medicare prescription drug benefit, hereafter 
referred to as Part D.  We did not review marketing materials for the 
Part D plans, as Part D did not begin until January 1, 2006.  Thus, any 
references to MA plan drug benefits exclude Part D drug benefits.  
Medicare Advantage Marketing  
MA organizations market their plans to differentiate them from both 
the original Medicare fee-for-service program and other MA plans.  MA 
organizations employ a variety of marketing materials to inform and 
recruit beneficiaries.  These materials can be grouped into two broad 
categories: 
 	 Advertising materials, including newspapers, direct mail, 
television advertisements, and radio scripts. 
 	 Enrollment materials, including the following: 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  1  I N T R O D U C T I O N  
o 	 Sales brochures, which are product descriptions used in 
the sales/enrollment process that provide more details 
than advertisements; 
o 	 Enrollment forms/applications, which beneficiaries 
complete prior to enrolling in an MA plan; 
o 	 Evidence of coverage documents (also known as the 
member contract or subscriber agreement), which detail 
the benefits and restrictions of the MA plan; and  
o 	 Summary of benefits documents, which provide a 
synopsis of the MA plans coverage. 
To ensure consistency across summaries of benefits, CMS directs MA 
plans to generate sections of these documents directly from information 
the plans enter into the Health Plan Management System (HPMS).3 
CMS maintains the HPMS to track marketing materials that plans 
submit to CMS for review.  Plans also use the HPMS to submit 
marketing materials electronically to CMS for review. 
Medicare Managed Care Marketing Oversight 
Pursuant to section 1876 (c)(3)(C) of the Social Security Act and Federal 
regulations, CMS, on behalf of the Secretary of the Department of 
Health and Human Services, reviews the marketing materials that MA 
organizations use.4  Federal regulations set forth required elements of 
marketing materials.  Pursuant to the regulations, MA organizations 
must provide beneficiaries with adequate written descriptions of rules, 
plan benefits, appeals and grievance processes, and the information 
necessary to make informed decisions about enrollment.5  Federal 
regulations also prohibit some marketing practices.  For example, MA 
organizations must not discriminate against recruiting beneficiaries 
from low-income areas, mislead or confuse beneficiaries, misrepresent 
the health plan or CMS, or provide monetary rebates for enrollment.6 
CMSs Medicare Managed Care Manual (hereafter, the manual) 
provides operational guidelines for meeting Federal marketing 
requirements and provides instructions regarding the review process. 
In addition, the manual instructs plans to make their marketing 
materials reader-friendly.7  In the manual, CMS also provides MA 
organizations with models of various marketing materials they can 
adapt for their own use.  CMS drew heavily upon the manual when it 
created guidelines for marketing materials for the Medicare Part D 
benefit that began in January 2006.8 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  2  I N T R O D U C T I O N  
The manual specifies language that marketing materials must use, 
language plans can use, and language they cannot use. This guidance 
addresses such aspects of marketing materials as: 
  descriptions of premium costs, 
  required plan contact information, 
  descriptions of prescription drug benefits, and  
  definitions of coverage terms (e.g., benefit period). 
For example, marketing materials that refer to prescription drug 
benefits must reference any limitations to these benefits to avoid 
misleading beneficiaries about the true level of coverage.9 
Prior Work by the Office of Inspector General 
Two Office of Inspector General (OIG) reviews of managed care 
marketing materials (OEI-03-98-00270 and OEI-03-98-00271) conducted 
in 2000 found that only 13 percent of a purposive sample of  
CMS-reviewed materials met all of CMSs marketing requirements.10 
Furthermore, OIG found that 46 percent of the materials were 
confusing or contained jargon.  OIG recommended that CMS 
standardize and mandate use of member materials, update its 
marketing guidelines, develop standard review instruments, and track 
marketing material reviews across regions. 
The reports recommendations spurred changes in CMSs handling of 
Medicare managed care marketing materials.  Specifically, CMS 
established standard and model forms for member materials, formalized 
marketing guidelines into the manual, and developed the HPMS to 
track marketing materials.   
METHODOLOGY 
We reviewed a total of 415 marketing materials from a multistage 
random sample of 36 MA plans.  While our sample was randomly 
drawn, it was not large enough to produce reliable estimates of the 
population of plans.  The MA plans we examined met two criteria. 
First, these MA organizations were in operation prior to 
January 1, 2004. Second, these MA organizations enrolled new 
members in December 2004.  These criteria ensured that we selected 
plans that had at least 1 year of experience and that participated in 
Medicare through January 2005. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  3  I N T R O D U C T I O N  
These criteria yielded a population of 130 MA organizations from CMSs 
HPMS. Some MA organizations offer more than one plan; however, we 
selected only one plan from each organization.11  We sampled plans 
based on the number of plans offered by the MA organizations and the 
number of members in these plans.  Appendix A contains a detailed 
description of our methodology. 
After selecting our sample, we contacted the 36 MA plans and requested 
copies of any of the following materials the selected plan issued through 
March 1, 2005: advertising materials, sales brochures, enrollment 
forms/applications, summaries of benefits, and evidence of coverage 
documents. We received materials from all 36 plans for a total of   
415 pieces of marketing materials.  For each plan, we received one 
enrollment form, one summary of benefits, and one evidence of coverage 
document. We also received a total of 281 advertisements and 26 sales 
brochures from the 36 plans. 
For our review, we created and used five review guidesone for each 
type of material.  We based these review guides on requirements 
specified in the manual.  We used five separate review guides because 
CMS marketing requirements vary depending on the type of marketing 
material. In addition to determining whether the marketing materials 
met CMSs requirements, we assessed whether the material was clear 
(i.e., obvious and not misleading) and free of technical language. 
Additionally, we interviewed staff from four CMS regional offices that 
are responsible for overseeing large numbers of MA plans:  Atlanta, 
Chicago, San Francisco, and Seattle. Our interviews focused on these 
offices reviews of marketing materials and barriers to the review 
process. 
This study was conducted in accordance with the Quality Standards for 
Inspections issued by the Presidents Council on Integrity and 
Efficiency and the Executive Council on Integrity and Efficiency. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  4  F I N D I N G S  
  F I N D I N G S

Some marketing materials in our sample lacked 
CMS-required information concerning  Prior to January 1, 2006, MA 
plans offering prescription drug 
limitations to prescription drug benefits 
coverage provided a benefit 
unavailable through traditional fee-for-service Medicare.  To ensure 
that beneficiaries understand the true benefits and limitations of a 
plans prescription drug benefit, CMS requires that plans include 
several types of information in their marketing materials when they 
refer to prescription drug coverage.12 
Some marketing materials for MA plans offering drug coverage omitted 
required information concerning prescription drug benefit formularies 
(see Table 1).  Specifically, in our sample, 55 percent of summaries of 
benefits for these plans did not state that the formulary contents are 
subject to change without advance notice.  Because the formulary 
represents the list of drugs a plan covers, beneficiaries should 
understand these restrictions on their drug coverage.  For this reason, 
CMS requires plans to inform beneficiaries that the plan uses a 
formulary, that formulary contents can change at any time, and that 
beneficiaries can appeal if they have complaints about the formulary.   
Table 1. Missing Information Concerning Prescription Drug Formularies 
Materials Not Meeting 
CMS Requirement 
This Requirement* 
Summaries of benefits must state that formulary contents are subject to  55% 
change without advance notice.  (12 out of 22) 
Evidence of coverage documents must specify that beneficiaries can use the 
18% 
appeals process to get drugs added to the formulary or to appeal a decision 
(4 out of 22) 
not to cover a particular drug. 
*Denominators equal the number of materials for plans that use a formulary for prescription drug benefits. 
Source:  Office of Inspector General analysis of MA plan marketing materials, 2005. 
Additionally, to ensure that beneficiaries understand the full costs and 
restrictions of a prescription drug benefit, CMS requires that 
advertising materials identify any drug coverage limitations and the 
amount of any copayments, as well as inform beneficiaries if the benefit 
is restricted to a formulary.13  However, 10 percent of advertisements in 
our sample omitted required information concerning coverage 
limitations on prescription drug benefits (see Table 2).   
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  5  F I N D I N G S  

Table 2. Missing References to Coverage Limitations 
Materials Not Meeting 
CMS Requirement  
This Requirement* 
Advertisements must identify any coverage limitations when referring to  10% 
prescription drug benefits.  (18 out of 179) 
Sales brochures for plans with prescription drug benefits must identify the  82% 
amount of any copayments for prescription drugs.  (9 out of 11) 
Sales brochures for plans with prescription drug benefits must inform  70% 
beneficiaries if the prescription drug benefit is limited to a formulary.  (7 out of 10) 
 * Denominators equal the total number of marketing materials that require the respective information. 
Source:  Office of Inspector General analysis of MA plan marketing materials, 2005. 
Finally, many sales brochures we reviewed also omitted required 
information about prescription drug benefit limitations.  It is important 
that sales brochures include this information so that beneficiaries 
understand the amount of drug coverage they receive (see Table 2).  One 
sales brochure noted only that copayments may apply, without 
explaining how beneficiaries incur these costs or providing copayment 
amounts.  Moreover, 7 out of 10 sales brochures did not inform 
beneficiaries that the plans prescription drug benefit was limited to a 
formulary. 
Some marketing materials in our sample lacked 
elements required by CMS to ensure that 
beneficiaries can access plan information 
Some marketing materials omitted operating hours and contact information 
CMS requires that each plans marketing materials include complete 
contact information, including operating hours for phone numbers.14 
Listing this contact information ensures that beneficiaries know how to 
obtain any additional information they need to make informed plan 
selections. Yet, 52 percent of advertisements did not provide operating 
hours for their customer service numbers (see Table 3).   
Additionally, 67 percent of summaries of benefits and 8 percent of 
evidence of coverage documents did not include the operating hours for 
1-800-MEDICARE (see Table 3).  Whenever enrollment materials list   
1-800-MEDICARE, the manual directs materials to state that this 
phone number operates 24 hours a day, 7 days a week, because this 
represents an additional resource for beneficiary information.15 In 
contrast, many MA plans operate customer service phone numbers only 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  6  F I N D I N G S  
on weekdays during business hours.  Because 1-800-MEDICARE can 
provide beneficiaries with additional information on MA plans, CMS 
directs plans to include language identifying 1-800-MEDICARE and its 
operating hours in the template MA plans use to develop summaries of 
benefits. Because plans create sections of their summaries of benefits 
directly from CMSs HPMS system, it is unclear why HPMS does not 
automatically include 1-800-MEDICAREs operating hours in these 
sections.16 
Table 3. Missing Contact Information in MA Marketing Materials 
Materials Not Meeting 
CMS Requirement  
This Requirement 
Advertisements that provide customer service phone numbers must list  52% 
operating hours for these services.  (146 out of 279*) 
Summaries of benefits must state that 1-800-MEDICARE operates 24  67% 
hours a day, 7 days a week if they provide this phone number.  (24 out of 36) 
Evidence of coverage documents must state that 1-800-MEDICARE  8% 
operates 24 hours a day, 7 days a week if they provide this phone number.  (3 out of 36) 
*Denominator equals the number of advertisements that provide customer service phone numbers. 
Source:  Office of Inspector General analysis of MA plan marketing materials, 2005. 
Some marketing materials lacked information for beneficiaries with special 
needs 
CMS requires marketing materials to include language to ensure that 
beneficiaries with special needs have full access to plan information (see 
Table 4).17  CMS also requires MA plans to present the text telephone 
number for individuals with hearing impairments, known as a TTY 
phone number, in the same font size and style as other customer service 
numbers.18  Ten percent of advertisements did not present TTY phone 
numbers in the same font size and style as other phone numbers.  Eight 
percent of advertisements failed to include this number at all.   
CMS requires advertisements that invite beneficiaries to attend sales 
presentations to provide contact information for accommodating persons 
with special needs.19  Sales presentations offer beneficiaries more 
detailed plan information than advertisements provide.  Twenty-eight 
percent of these advertisements failed to include information about 
special accommodations (see Table 4).  For example, one advertisement 
simply invited qualified Medicare beneficiaries to attend a sales 
presentationlanguage that did not indicate how beneficiaries with 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  7  FFF III NNN DDD III NNN GGG SSS  
special needs can access these opportunities for learning about plans 
and interacting with sales representatives. 
Table 4. Omitted Contact Information for Beneficiaries With Special Needs 
Materials Not Meeting 
CMS Requirement 
This Requirement 
Advertisements must provide TTY phone numbers whenever other  8% 
customer service numbers are presented.  (23 out of 275*) 
Advertisements must present TTY phone numbers in the same font size  10% 
and style as other phone numbers.  (25 out of 252*) 
Advertisements that invite beneficiaries to sales presentations must  28% 
indicate how to make arrangements for individuals with special needs.  (34 out of 120*) 
Evidence of coverage documents must indicate that information in the  39% 
document is available in other formats.  (14 out of 36) 
* Denominators equal the total number of marketing materials that require the respective information. 
Source: Office of Inspector General analysis of MA plan marketing materials, 2005. 
Thirty-nine percent of evidence of coverage documents did not indicate 
that individuals could obtain the document in other formats (see 
Table 4). Moreover, simply including a statement about the availability 
of other formats does not ensure that beneficiaries will understand what 
options exist. For example, three of these documents noted only that 
the document was available in other formats. However, 19 evidence of 
coverage documents (53 percent) indicated which other formats were 
availablefor example, large print, audio tape, and non-English 
language. Statements indicating exactly which formats are available 
are likely to be more useful to beneficiaries than statements that refer 
to other formats but do not identify them. 
Some marketing materials in our sample did not 
clearly convey information concerning other 
aspects of MA plan coverage 
When describing plan coverage, 28 percent of summaries of benefits did not 
define benefit period as CMS requires 
CMS requires summaries of benefits to define the term benefit period 
in a footnote when using it to describe the plan (see Table 5).20 A 
benefit period defines a specific period of health care and a beneficiarys 
coverage during that period.21 To fully understand the details of a 
plans coverage, beneficiaries must understand such coverage terms. 
OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  8  F I N D I N G S  
CMSs HPMS system generates a footnote for the summary of benefits 
that defines benefit period when describing original Medicare benefits.  
The manual specifies that plans must add this footnote when using the 
term to describe what the MA plan provides. 
Thirty-six percent of summaries of benefits did not communicate the risk of 
nonrenewal as required by CMS 
CMS reviews MA organizations annually and may choose not to renew 
an MA organizations contract for the following year. CMS requires MA 
organizations to include a statement in their summary of benefits 
informing beneficiaries of this annual review and renewal process to 
make beneficiaries aware that their plan may not be available in future 
years.22  Of the summaries of benefits we reviewed, 36 percent did not 
state that CMS renews MA organizations contracts annually and that 
nonrenewal could result in the termination of the beneficiaries 
enrollment in the plan (see Table 5).  While CMS declined to renew only 
3 plan contracts in January 2005, the number of plans participating in 
Medicare has fluctuated considerably, from a high of 346 plans in 1998 
to a low of 151 plans in 2003.23 
Table 5. Omitted Information About Plan Coverage 
Materials Not Meeting 
CMS Requirement for Summaries of Benefits 
This Requirement 
Include a footnote definition of the term benefit period when using this  28% 
term to describe the health plan.   (9 out of 32*) 
State that the plans contract is renewed annually and nonrenewal could  36% 
result in loss of coverage.  (13 out of 36) 
*Denominator equals the number of summaries of benefits that use this term. 
Source:  Office of Inspector General analysis of MA Plan Marketing Materials, 2005. 
Enrollment forms and evidence of coverage documents were not       
reader-friendly 
The manual encourages MA organizations to develop reader-friendly 
marketing materials so that beneficiaries are able to fully understand 
plans benefits and conditions.24  For this study, we defined  
reader-friendly materials as those that use clear language and avoid 
technical language (see Text Box 1).  Eleven percent of enrollment forms 
and evidence of coverage documents contained unclear language.  
Additionally, 19 percent of enrollment forms and 14 percent of evidence 
of coverage documents included technical language.  We found unclear 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  9  F I N D I N G S  
and technical language most often in enrollment forms and evidence of 
coverage documents (see Table 6 on page 11).   
Text Box 1.  Examples of Unclear and Technical Language 
Unclear language 
Services rendered without prior authorization of my Plan contracting 
primary care physician (PCP), except for emergency services anywhere 
in the world or urgently needed services outside the Plan service area (or 
under unusual and extraordinary circumstances, provided when I am in 
the service area, but my contracting medical group is temporarily 
unavailable or inaccessible), will not be reimbursed by Plan or Medicare. 
(Evidence of coverage) 
I agree and understand that any and all disputes, including claims 
relating to the delivery of services under the plan and claims of medical 
malpractice (that is as to whether any medical services rendered under 
the health plan were unnecessary or unauthorized or were improperly, 
negligently or incompetently rendered), except for claims subject to 
ERISA, between myself and my dependents enrolled in the plan 
(including any heirs or assigns) and HMO, or any of its parents, 
subsidiaries or affiliates shall be determined by submission to binding 
arbitration.  Any such dispute will not be resolved by a lawsuit or resort to 
court process, except as the Federal Arbitration Act provides for judicial 
review of arbitration proceedings. (Enrollment Form) 
Technical language 
Termination of Coverage will not terminate coverage of Medicare Part A 
inpatient Covered Health Services under the Plan if, on the date of 
termination, you are Confined as an inpatient in a Hospital, a 
rehabilitation Hospital, a distinct part of a Hospital used as an inpatient 
rehabilitation unit, or a long-term care facility or Hospital as covered 
under Section 6.B.2 of this EOC, and your place of Confinement is paid 
by CMS on a prospective payment system basis (per stay basis.) 
(Evidence of coverage) 
Source:  Office of Inspector General analysis of MA Plan Marketing Materials, 2005. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  10  F I N D I N G S  

Table 6. Unclear and Technical Language in Marketing Materials 
Type of Material  Unclear Language  Technical Language 
11%  19% 
Enrollment Form 
(4 out of 36)  (7 out of 36) 
11%  14% 
Evidence of Coverage 
(4 out of 36)  (5 out of 36) 
3%  0% 
Summary of Benefits 
(1 out of 36)  (0 out of 36) 
0%  1% 
Advertisement 
(0 out of 281)  (3 out of 281) 
0%  0% 
Sales Brochure 
(0 out of 26)  (0 out of 26) 
Source:  Office of Inspector General analysis of MA Plan Marketing Materials, 2005. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  11    C O N C L U S I O N  

Our review found that some Medicare Advantage marketing materials 
lacked CMS-required information essential for beneficiaries to make 
informed plan choices. Missing information concerned prescription drug 
benefit limitations and details that convey how beneficiaries can access 
plan information.  Furthermore, some marketing materials described 
aspects of plan coverage using unclear and technical language. 
CMSs continued diligence in reviewing marketing materials is 
essential.  CMS will also need to ensure consistency between its HPMS 
system and its requirements for marketing materials.  We will continue 
to monitor marketing materials for Medicare Advantage plans and for 
Medicare Part D plans, as well as CMSs oversight of the review process 
for these materials.   
AGENCY COMMENTS 
CMS concurred with our findings, stating that the report will help it 
improve its marketing review process.  CMS also highlighted 
enhancements it made to the review process for Medicare Advantage 
and Medicare Part D plan marketing materials to improve their 
consistency.  These include a consolidated review of Medicare 
Advantage and Medicare Part D plan marketing materials by CMS 
regional office staff, a contractor review of the consistency of marketing 
materials, and new features in its HPMS system to assist in monitoring 
the review process.  For the full text of CMSs comments, see 
Appendix B. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  12    E N D N O T E S  

1 70 Federal Register 4588, 4591 (January 28, 2005). 
2 The remaining 15 percent of Medicare beneficiaries are enrolled in 
a variety of Medicare programs, such as cost-based plans, 
demonstration projects, preferred provider organizations, private 
fee-for-service plans, and provider-sponsored organizations. In 
addition, the Program of All-Inclusive Care for the Elderly is a 
capitated managed care model that is not part of the MA program. 
3 CMS. Medicare Managed Care Manual, Chapter 3, Marketing, 
p. 61. 
4 42 C.F.R.  422.80. 
5 42 C.F.R.  422.80(c)(1). 
6 42 C.F.R.  422.80(e)(1). 
7 CMS. Medicare Managed Care Manual, Chapter 3, Marketing, 
p. 3. 
8 CMS. Medicare Part D Plan Marketing Guidelines, August 15, 
2005. 
9 CMS. Medicare Managed Care Manual, Chapter 3, Marketing, 
pp. 47-48. 
10 Department of Health and Human Services, OIG, Office of 
Evaluation and Inspections (OEI), Final Reports, Medicare 
Managed Care:  Goals of National Marketing Guide, OEI-03-98-
00270; and Medicare Managed Care:  1998 Marketing Materials, 
OEI-03-98-00271, February 2000.   
11 The MA organization carries the actual contract with CMS; in 
CMSs system this is referred to as the H#, which is analogous to 
a provider number for a hospital.  Within that H#, an MA 
organization may offer plans for different geographic areas 
(typically counties), different benefit packages, or different 
premium arrangements. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  13  12 CMS. Medicare Managed Care Manual, Chapter 3, 

Marketing, pp. 22, 32, and 47-48. 

13 Ibid., pp. 47-48. 

14 Ibid., pp. 16-17, 20, 38, and 45. 

15 Ibid., pp. 16-17, 20, and 38. 

16 Ibid., p. 62. 

17 Ibid., pp. 16 and 61. 

18 Ibid., pp. 17, 21, 34, and 38. 

19 Ibid., p. 16. 

20 Ibid., p. 63. 

21 Ibid., p. 63. CMS requires plans to include the following 

definition for a benefit period: 

A benefit period begins the day you go to the hospital or 
skilled nursing facility.  The benefit period ends when you 
have not received hospital or skilled nursing facility care for 
60 days in a row.  If you go into the hospital after one 
benefit period has ended, a new benefit period begins.  You 
must pay the inpatient hospital deductible for each benefit 
period.  There is no limit to the number of benefit periods 
you can have. 
22 Ibid., p. 23. 

23 Medicare Health Plan Tracker; Medicare Advantage Fact Sheet.  

Henry J. Kaiser Family Foundation.  September 2005, available 

online at www.kff.org. 

24 CMS. Medicare Managed Care Manual, Chapter 3, p. 3. 

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METHODOLOGY 
We obtained marketing materials from a random sample of 36 MA plans 
that CMS classifies as health maintenance organizations (HMOs) and 
HMO point of service (HMOPOS) plans.1  We selected these 
organizations in an unbiased random sample that is representative of 
organizations that vary by their number of plans and of plans that vary 
by enrollment size.  While our sample was randomly drawn, it was not 
large enough to produce reliable estimates of the population of plans.   
Selection of MA plans.  The MA plans we examined were from MA 
organizations that met two criteria. First, the MA organizations must 
have been in operation prior to January 1, 2004.  We used that date to 
ensure that the MA organization had at least 1 year of operational 
experience prior to the timeframe for which we requested materials.  
Second, the MA organization must have enrolled new members in 
December 2004. This criterion ensured that the plan continued to be an 
active contractor in the MA program at the time we sampled. 
From these criteria, we obtained a population of 132 MA organizations 
from CMSs Health Plan Management System.  After consulting with 
other branches of OIG, we reduced the number under consideration to 
130 MA organizations. 
Each MA organization may offer more than one plan.2  Our starting 
population of 130 MA organizations included 659 plans.  Some 
organizations have 20 or more plans, while others have only one. We 
selected only one plan from each organization because organizations 
may use similar marketing materials for all their MA plans.  
Due to sample size limitations, the variability in the number of plans 
offered by MA organizations, the variability in the enrollment size 
among plans within MA organizations, and our desire to have a sample 
that was representative of the population, we used the following 
sampling strategy. First, we eliminated from our population 146 plans 
1 The HMOPOS plans are point-of-service plans.  HMOs make up about 94 percent of 
enrollees and plans, and the eight HMOPOS plans make up the remaining 6 percent of 
each. 
2 The MA organization carries the actual contract with CMS; in CMSs system this is 
referred to as the H#, which is analogous to a provider number for a hospital.  Within that 
H#, an MA organization may offer plans for different geographic areas (typically counties), 
different benefit packages, or different premium arrangements. 
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that enrolled fewer than 100 beneficiaries. This left a population of 
513 plans in the 130 MA organizations.   
We grouped the 130 MA organizations into 8 strata by first forming  
4 primary groups based on the number of plans that the MA 
organizations offer. We then subdivided each primary group into two 
subgroups based on enrollment size within the organizations.   
In the first stage of sampling, we randomly selected MA organizations 
within each stratum.  In the second stage of sampling, we randomly 
selected one plan from each MA organization selected in the first stage 
of sampling, yielding individual plans with a relatively high enrollment 
and plans with a relatively low enrollment. 
Marketing materials reviewed. We contacted the selected MA 
organizations and asked them to send us the following materials issued 
for the selected plan for the 2005 marketing period, through 
March 1, 2005: 
  Advertising materials 
o  Print advertisements published in newspapers  
o  Direct mail advertisements  
o  Scripts for radio and television advertisements 
  Enrollment materials 
o  Sales brochures/kits 
o  Enrollment forms/applications 
o  Summary of benefits 
o  Evidence of coverage 
We received materials from all 36 plans, for a total of 415 pieces.  For 
each plan, we received one enrollment form, one summary of benefits, 
and one evidence of coverage document.  We also received a total of   
281 advertisements and 26 sales brochures from the 36 plans. 
Review guides.  We developed and used five review guides, one for each 
type of material. Multiple guides were necessary because requirements 
governing what must appear in the different types of materials vary. 
We based these review guides on requirements specified in CMSs 
Medicare Managed Care Manual, Chapter 3, Marketing. 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  16  A P P E N D I X   A  
In addition to determining whether the marketing materials met CMSs 
requirements, we included two additional questions on each review 
instrument to assess whether the material was reader-friendly: 
 	 Is this piece clear or confusing? 
 	 Does this piece contain technical language or jargon? 
For our purposes we defined a clear piece as one in which the meaning 
of all the text is obvious and not misleading.  We define jargon as:  
 	 Technical language (i.e., words, terms, phrases, and acronyms 
specific to a certain field) and 
 	 Sentences with strings of big words, overblown phrases, 
-izing words (e.g., finalizing, utilizing), invented words (e.g., 
signage), legalese, or bureaucratic language. 
We recognize that determining whether marketing materials are 
reader-friendly is a subjective process.  These criteria provided a way of 
looking at the materials systematically. 
CMS Regional Office Interviews 
To learn more about the marketing material review process, we 
interviewed staff from four CMS regional offices that are responsible for 
overseeing large numbers of MA plans:  Atlanta, Chicago, San 
Francisco, and Seattle.  Our interviews focused on the offices reviews of 
marketing materials and barriers to the review process. 
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Agency comments 
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  A C K N O W L E D G M E N T S  

This report was prepared under the direction of Joyce M. Greenleaf, 
Regional Inspector General for Evaluation and Inspections in the 
Boston regional office, and Russell W. Hereford, Deputy Regional 
Inspector General.  Other principal Office of Evaluation and Inspections 
staff who contributed include: 
Maria E. Maddaloni, Team Leader 
Rosemary Borck, Program Analyst 
Benjamin T. Mahdi, Intern 
Linda B. Abbott, Program Specialist 
Barbara Tedesco, Mathematical Statistician 
Kevin Farber, Mathematical Statistician 
  OEI-01-05-00130  MEDICARE ADVANTAGE MARKETING MATERIALS FOR CALENDAR YEAR 2005  22