HR 4236 IH
106th CONGRESS
2d Session
H. R. 4236
To amend part C of title XVIII of the Social Security Act to improve
payments under the Medicare+Choice Program.
IN THE HOUSE OF REPRESENTATIVES
April 11, 2000
Mr. FOLEY (for himself, Mrs. KELLY, Mr. COOK, Mr. BASS, and Mr. CANADY of
Florida) introduced the following bill; which was referred to the Committee on
Ways and Means, and in addition to the Committee on Commerce, for a period to be
subsequently determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
A BILL
To amend part C of title XVIII of the Social Security Act to improve
payments under the Medicare+Choice Program.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the `Seniors Health Choice Preservation Act of
2000'.
SEC. 2. APPLICATION OF BUDGET NEUTRALITY PRINCIPLE TO THE NEW
MEDICARE+CHOICE RISK ADJUSTMENT METHODOLOGY.
(a) IN GENERAL- Section 1853(a)(3) of the Social Security Act (42 U.S.C.
1395w-23(a)(3)) is amended by adding at the end the following new
subparagraph:
`(E) IMPLEMENTATION IN A BUDGET NEUTRAL MANNER- The methodology under
this paragraph shall be designed and implemented in a manner so that it
does not result in any material change in the aggregate level of
expenditures under this title compared to the level that would have
occurred if such methodology had not been implemented (and if the previous
risk adjustment methodology used in 1998 had continued to be
implemented).'.
(b) EFFECTIVE DATE- The amendment made by subsection (a) takes effect on
the date of the enactment of this Act and applies to payments for months
beginning on or after January 2001.
SEC. 3. CHANGES TO HEALTH-STATUS RISK ADJUSTMENT.
(a) IMPLEMENTATION OF HEALTH-STATUS RISK ADJUSTMENT THROUGH NEGOTIATED
RULEMAKING- Section 1853(c) of the Social Security Act (42 U.S.C. 1395w-23(c))
is further amended by adding at the end the following new paragraph:
`(4) IMPLEMENTATION OF HEALTH-STATUS RISK ADJUSTMENT THROUGH NEGOTIATED
RULEMAKING-
`(A) IN GENERAL- The Secretary shall establish, using a negotiated
rulemaking process under subchapter III of chapter 5 of title 5, United
States Code, and on an expedited basis, health-status related risk
adjustors described in paragraph (3).
`(B) APPOINTMENT OF COMMITTEE- In appointing negotiated rulemaking
committee under section 565(a) of such title, the Secretary shall include
representatives of Medicare+Choice organizations, providers, the Medicare
Payment Advisory Commission, the Academy of Actuaries, the Department of
Health and Human Services, and representatives of organizations with
expertise in data privacy issues.
`(C) FACTORS TO CONSIDER- The health status risk adjustment
methodology shall be based on the health status of Medicare+Choice
enrollees. In evaluating alternative approaches, the committee and the
Secretary shall weigh the costs of implementing risk adjustment methods
against their benefits in terms of predictive power.
`(i) COMMITTEE APPOINTMENT- The Secretary shall provide for the
appointment of the negotiated rulemaking committee under subparagraph
(B) by not later than 6 months after the date of the enactment of this
paragraph.
`(ii) REPORTING DEADLINE- The committee shall submit its
recommendations to the Secretary by not later than December 31,
2001.
`(E) SUPERSEDING OTHER PROVISIONS- Regulations promulgated by the
Secretary pursuant to recommendations of the committee shall supersede the
regulations implemented under paragraph (3).'.
(b) LIMITING PHASE-IN OF CURRENT HEALTH-STATUS RISK ADJUSTMENT
METHODOLOGY- Section 1853(a)(3)(C)(ii)(II) of such Act (42 U.S.C.
1395w-23(a)(3)(C)(ii)(II)), as amended by section 511(a) of the Medicare,
Medicaid, and SCHIP Balanced Budget Refinement Act of 1999 (113 Stat.
1501A-380), as enacted into law by section 1000(a)(6) of Public Law 106-113,
is amended by striking `not more than 20 percent of such capitation rate in
2002' and inserting `not more than 10 percentage points more than the percent
of 1/12 of the annual Medicare+Choice capitation rate that it applied to in
the previous year, except as may be provided for under paragraph (4)'.
(c) ELIMINATION OF REQUIREMENT TO REPORT ENCOUNTER DATA- The Secretary of
Health and Human Services shall immediately discontinue all activity related
to requiring Medicare+Choice organizations, under part C of title XVIII of the
Social Security Act, to submit encounter data for sites other than hospital
inpatient departments, before final regulations are promulgated implementing
the health-status risk adjustment methodology developed under the amendment
made by subsection (a).
SEC. 4. ADDITIONAL FLOOR FOR ANNUAL INCREASE IN MEDICARE+CHOICE CAPITATION
RATES.
Section 1853(c)(3)(C) of the Social Security Act (42 U.S.C.
1395w-23(c)(3)(C)) is amended--
(1) in clause (ii), by inserting `(before 2002)' after `For a subsequent
year'; and
(2) by adding at the end the following new clause:
`(iii) For 2002 and each subsequent year, the greater of (I) 102
percent of the
annual Medicare+Choice capitation rate under this paragraph for the area for
the previous year, or (II) such rate for the previous year increased by the
national per capita Medicare+Choice growth percentage, described in paragraph
(6)(A) for the succeeding year.'.
SEC. 5. PAYMENT OF ADDITIONAL DRUG INFLATION DIFFERENTIAL FOR
MEDICARE+CHOICE PLANS OFFERING QUALIFIED PRESCRIPTION DRUG COVERAGE.
(a) IN GENERAL- Section 1853 of the Social Security Act (42 U.S.C.
1395w-23) is amended--
(1) in subsection (a)(1)(A), by striking `and (i)' and inserting `(i),
and (j)'; and
(2) by adding at the end the following new subsection:
`(j) PAYMENT OF ADDITIONAL DRUG INFLATION DIFFERENTIAL FOR MEDICARE+CHOICE
PLANS OFFERING QUALIFIED PRESCRIPTION DRUG COVERAGE-
`(1) IN GENERAL- In the case of a Medicare+Choice plan that offers
qualified prescription drug coverage (as defined in paragraph (2))) in a
year and that meets the conditions described in paragraph (3), the annual
Medicare+Choice capitation rate otherwise applied under this section shall
be increased by the percentage specified in paragraph (4).
`(2) QUALIFIED PRESCRIPTION DRUG COVERAGE DEFINED- In this subsection,
the term `qualified prescription drug coverage' means coverage for
outpatient prescription drugs under which--
`(A) there is no deductible applicable; and
`(B) there is either no limitation to the amount of benefits available
in a year or any such limitation is not less than $1,500.
Nothing in this paragraph shall be construed as preventing a
Medicare+Choice plan offering qualified prescription drug coverage from
imposing a copayment or other cost-sharing, other than a deductible.
`(3) CONDITIONS- The conditions described in this paragraph with respect
to a Medicare+Choice plan for months in a year are as follows:
`(A) NO SEPARATE PREMIUM- There is no separate premium established for
qualified prescription drug coverage under the plan.
`(B) LIMIT ON PREMIUMS- The adjusted community rate proposal shall
include a certification that the percentage increase in the cost of drug
benefits does not exceed 150 percent of the Secretary's estimate of the
percentage specified in paragraph (4), adjusted to fairly reflect changes
in the benefits provided.
`(4) DIFFERENTIAL PERCENTAGE- The percentage specified in this paragraph
for a Medicare+Choice plan for months in a year is equal to the product of
the following:
`(A) DRUG INFLATION DIFFERENTIAL- The number of percentage points by
which--
`(i) the annual rate of inflation for prescription drug coverage
under Medicare+Choice plans (as estimated by the Secretary for the
year), exceeds
`(ii) the percentage increase in the annual Medicare+Choice
capitation rate applicable to the plan under subsection (a) (not taking
into account this subsection) for the year involved.
`(B) PROPORTION OF TOTAL VALUE REPRESENTED BY DRUG COVERAGE- The ratio
of--
`(i) the average per capita actuarial value of the qualified
prescription drug coverage under the plan for the year; to
`(ii) the actuarial value of all benefits under the plan for the
year.
In no case shall the percentage under this paragraph be less than
0.
`(5) TREATMENT- The percentage increase in payment effected under this
subsection shall be taken into account in applying section 1854(f) (relating
to additional benefits) and such payment increase is subject to adjustment
for risk factors under subsection (a) in the same manner as the payment
described in such subsection.
`(6) CONSTRUCTION- Nothing in this subsection shall be construed as
requiring a Medicare+Choice plan to provide qualified or other prescription
drug coverage.'.
(b) EFFECTIVE DATE- The amendments made by subsection (a) apply to payment
for months beginning with January 2002.
END