The rule
When a client makes any plan change within the first three months of enrollment, the plan must recover the entire compensation paid for that enrollment (42 CFR 422.2274).
Common exceptions
- Enrollment effective October 1, November 1 or December 1, then a change during the Open Enrollment Period effective January 1
- Gaining or losing employer or union coverage, or other creditable coverage
- Moving into or out of an institution, or out of the service area
- Becoming eligible for Extra Help or for both Medicare and Medicaid
- Plan termination, non-renewal or a CMS sanction
- Moving into a 5-star plan, death or non-payment of premium
See the regulation for the full list (42 CFR 422.2274).
How to protect your book
- Review the client’s doctors and prescriptions before the enrollment, not after.
- Explain how the plan works, including networks and costs, in plain words.
- Check in during the first months so questions come to you first.
Check any case with our rapid disenrollment checker.
General information for licensed agents, not legal advice. Rules change; always follow current CMS, state and carrier requirements.
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