State Warns Insurers About Medicare Sales Practices, Protects Seniors

The North Dakota Insurance Department has issued a formal warning to insurers and licensed producers about practices in the Medicare market that could limit consumer access and distort competition. The department's bulletin targets companies and producers offering Medicare Advantage, Medicare Supplement, Cost Plans, and Prescription Drug Plans in the state, outlining behaviors it deems unfair trade practices under North Dakota law.

The bulletin cites examples observed in other states where companies removed enrollment applications from their websites, discouraged producers from selling particular plans, or changed producer compensation mid year. The department made clear that such tactics can unlawfully steer consumers or penalize agents for recommending policies that best meet beneficiaries needs. It emphasized that both producers and companies are subject to state unfair trade practice statutes and that enrolling consumers in products solely for higher compensation is illegal.

Insurance Commissioner Jon Godfread framed the department action as a consumer protection and market integrity measure. "North Dakota’s seniors deserve clear, honest, and accessible information when choosing Medicare coverage," he said. "When insurers manipulate the marketplace or penalize producers for helping consumers make the best choice, it undermines both competition and trust. We expect all companies and agents operating in North Dakota to follow the law and act in good faith."

To promote transparency and fair competition, the department directed insurers and producers to make enrollment applications available in print and online, avoid discouraging enrollment for compensation reasons, not change commissions mid year, and provide compensation only as approved by the department. The bulletin also directs licensed producers to recommend products that meet consumer needs based on prescription drug coverage, provider networks, cost, and affordability.

The department warned it will monitor compliance and take enforcement action against any company or producer found violating the rules. "Fair markets depend on fair play," Godfread said. "Artificially limiting options or changing compensation after filings have been approved harms consumers and the professionals who serve them. North Dakota will not tolerate these tactics."

For Stutsman County residents, the bulletin underscores protections for seniors navigating Medicare choices and affirms the role of local agents in providing impartial advice. Consumers who believe they have experienced misleading or restrictive sales practices related to Medicare can contact NDSHIP at (888) 575-6611 or visit insurance.nd.gov. The department action raises immediate compliance expectations for insurers and producers, and signals increased regulatory scrutiny of sales conduct in the state Medicare market.