HR 2632 IH
107th CONGRESS
1st Session
H. R. 2632
To amend title XVIII of the Social Security Act to provide Medicare
beneficiaries with access to affordable outpatient prescription drugs.
IN THE HOUSE OF REPRESENTATIVES
July 25, 2001
Mr. FOLEY (for himself, Mrs. CAPITO, and Mr. TERRY) introduced the following
bill; which was referred to the Committee on Energy and Commerce, and in
addition to the Committee on Ways and Means, 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 title XVIII of the Social Security Act to provide Medicare
beneficiaries with access to affordable outpatient prescription drugs.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE- This Act may be cited as the `Medicare Rx Drug Discount
and Security Act of 2001'.
(b) TABLE OF CONTENTS- The table of contents of this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Voluntary Medicare Outpatient Prescription Drug Discount and
Security Program.
`Part D--Voluntary Medicare Outpatient Prescription Drug Discount and
Security Program
`Sec. 1860. Definitions.
`Subpart 1--Establishment of Voluntary Medicare Outpatient Prescription Drug
Discount and Security Program
`Sec. 1860A. Establishment of program.
`Sec. 1860B. Enrollment.
`Sec. 1860C. Providing enrollment and coverage information to
beneficiaries.
`Sec. 1860D. Enrollee protections.
`Sec. 1860E. Annual enrollment fee.
`Sec. 1860F. Benefits under the program.
`Sec. 1860G. Selection of entities to provide prescription drug
coverage.
`Sec. 1860H. Payments to eligible entities for administering the
catastrophic benefit.
`Sec. 1860I. Determination of income levels.
`Sec. 1860J. Appropriations.
`Subpart 2--Establishment of the Medicare Prescription Drug Agency
`Sec. 1860S. Medicare Prescription Drug Agency.
`Sec. 1860T. Commissioner; Deputy Commissioner; other
officers.
`Sec. 1860U. Administrative duties of the Commissioner.
`Sec. 1860V. Medicare Competition and Prescription Drug Advisory
Board.'.
Sec. 3. Commissioner as member of the board of trustees of the medicare
trust funds.
Sec. 4. Exclusion of part D costs from determination of part B monthly
premium.
Sec. 5. Medigap revisions.
SEC. 2. VOLUNTARY MEDICARE OUTPATIENT PRESCRIPTION DRUG DISCOUNT AND
SECURITY PROGRAM.
(a) ESTABLISHMENT OF PROGRAM- Title XVIII of the Social Security Act (42
U.S.C. 1395 et seq.) is amended by redesignating part D as part E and by
inserting after part C the following new part:
`Part D--Voluntary Medicare Outpatient Prescription Drug Discount and
Security Program
`DEFINITIONS
`SEC. 1860. In this part:
`(1) COMMISSIONER- The term `Commissioner' means the Commissioner of
Medicare Prescription Drugs appointed under section 1860S(a).
`(2) COVERED OUTPATIENT DRUG-
`(A) IN GENERAL- Except as provided in subparagraph (B), the term
`covered outpatient drug' means--
`(i) a drug that may be dispensed only upon a prescription and that
is described in clause (i) or (ii) of subparagraph (A) of section
1927(k)(2); or
`(ii) a biological product or insulin described in subparagraph (B)
or (C) of such section.
`(i) IN GENERAL- The term `covered outpatient drug' does not include
drugs or classes of drugs, or their medical uses,
which may be excluded from coverage or otherwise restricted under section
1927(d)(2), other than those restricted under subparagraph (E) of such section
(relating to smoking cessation agents).
`(ii) AVOIDANCE OF DUPLICATE COVERAGE- A drug prescribed for an
individual that would otherwise be a covered outpatient drug under this
part shall not be considered to be such a drug if payment for the drug
is available under part A or B (but such drug shall be so considered if
such payment is not available because the eligible beneficiary has
exhausted benefits under part A or B), without regard to whether the
individual is entitled to benefits under part A or enrolled under part
B.
`(3) ELIGIBLE BENEFICIARY- The term `eligible beneficiary' means an
individual who is--
`(A) eligible for benefits under part A or enrolled under part B;
and
`(B) not eligible for prescription drug coverage under a medicaid plan
under title XIX.
`(4) ELIGIBLE ENTITY- The term `eligible entity' means any entity that
the Commissioner determines to be appropriate to provide the benefits under
this part, including--
`(A) pharmaceutical benefit management companies;
`(B) wholesale and retail pharmacy delivery systems;
`(D) Medicare+Choice organizations;
`(F) any combination of the entities described in subparagraphs (A)
through (E).
`(5) POVERTY LINE- The term `poverty line' means the income official
poverty line (as defined by the Office of Management and Budget, and revised
annually in accordance with section 673(2) of the Omnibus Budget
Reconciliation Act of 1981) applicable to a family of the size
involved.
`Subpart 1--Establishment of Voluntary Medicare Outpatient Prescription Drug
Discount and Security Program
`ESTABLISHMENT OF PROGRAM
`SEC. 1860A. (a) PROVISION OF BENEFIT- The Commissioner shall establish a
Medicare Outpatient Prescription Drug Discount and Security Program under
which an eligible beneficiary may voluntarily enroll and receive benefits
under this part through enrollment with an eligible entity with a contract
under this part.
`(b) PROGRAM TO BEGIN IN 2003- The Commissioner shall establish the
program under this part in a manner so that benefits are first provided for
months beginning with January 2003.
`(c) VOLUNTARY NATURE OF PROGRAM- Nothing in this part shall be construed
as requiring an eligible beneficiary to enroll in the program under this
part.
`(d) FINANCING- The costs of providing benefits under this part shall be
payable from the Federal Supplementary Medical Insurance Trust Fund
established under section 1841.
`ENROLLMENT
`SEC. 1860B. (a) ENROLLMENT UNDER PART D-
`(1) ESTABLISHMENT OF PROCESS-
`(A) IN GENERAL- The Commissioner shall establish a process through
which an eligible beneficiary (including an eligible beneficiary enrolled
in a Medicare+Choice plan offered by a Medicare+Choice organization) may
make an election to enroll under this part. Except as otherwise provided
in this subsection, such process shall be similar to the process for
enrollment under part B under section 1837.
`(B) REQUIREMENT OF ENROLLMENT- An eligible beneficiary must enroll
under this part in order to be eligible to receive the benefits under this
part.
`(A) IN GENERAL- Except as provided under subparagraph (B) or (C), an
eligible beneficiary may not enroll in the program under this part during
any period after the beneficiary's initial enrollment period under part B
(as determined under section 1837).
`(B) SPECIAL ENROLLMENT PERIOD- In the case of eligible beneficiaries
that have recently lost eligibility for prescription drug coverage under a
medicaid plan under title XIX, the Commissioner shall establish a special
enrollment period in which such beneficiaries may enroll under this
part.
`(C) OPEN ENROLLMENT PERIOD IN 2003 FOR CURRENT BENEFICIARIES- The
Commissioner shall establish a period, which shall begin on the date on
which the Commissioner first begins to accept elections for enrollment
under this part and shall end on December 31, 2003, during which any
eligible beneficiary may--
`(i) enroll under this part; or
`(ii) enroll or re-enroll under this part after having previously
declined or terminated such enrollment.
`(A) IN GENERAL- Except as provided in subparagraph (B) and subject to
subparagraph (C), an eligible beneficiary's coverage under the program
under this part shall be effective for the period provided under section
1838, as if that section applied to the program under this part.
`(B) ENROLLMENT DURING OPEN AND SPECIAL ENROLLMENT- Subject to
subparagraph (C), an eligible beneficiary who enrolls under the program
under this part under subparagraph (B) or (C) of paragraph (2) shall be
entitled to the benefits under this part beginning on the first day of the
month following the month in which such enrollment occurs.
`(C) LIMITATION- Coverage under this part shall not begin prior to
January 1, 2003.
`(4) PART D COVERAGE TERMINATED BY TERMINATION OF COVERAGE UNDER PARTS A
AND B OR ELIGIBILITY FOR MEDICAL ASSISTANCE-
`(A) IN GENERAL- In addition to the causes of termination specified in
section 1838, the Commissioner shall terminate an individual's coverage
under this part if the individual is--
`(i) no longer enrolled in part A or B; or
`(ii) eligible for prescription drug coverage under a medicaid plan
under title XIX.
`(B) EFFECTIVE DATE- The termination described in subparagraph (A)
shall be effective on the effective date of--
`(i) the termination of coverage under part A or (if later) under
part B; or
`(ii) the coverage under title XIX.
`(b) ENROLLMENT WITH ELIGIBLE ENTITY-
`(A) IN GENERAL- The Commissioner shall establish a process through
which an eligible beneficiary who is enrolled under this part shall make
an annual election to enroll with any eligible entity that has been
awarded a contract under this part and serves the geographic area in which
the beneficiary resides.
`(B) RULES- In establishing the process under subparagraph (A), the
Commissioner shall use rules similar to the rules for enrollment and
disenrollment with a Medicare+Choice plan under section 1851 (including
the special election periods under subsection (e)(4) of such
section).
`(2) MEDICARE+CHOICE ENROLLEES- An eligible beneficiary who is enrolled
under this part and enrolled in a Medicare+Choice plan offered by a
Medicare+Choice organization must enroll with an eligible entity in order to
receive benefits under this part. The beneficiary may elect to receive such
benefits from the Medicare+Choice organization in which the beneficiary is
enrolled if the organization has been awarded a contract under this
part.
`(3) COMPETITION- Eligible entities with a contract under this part
shall compete for beneficiaries on the basis of discounts, formularies,
pharmacy networks, and other services provided for under the contract.
`(c) ENROLLMENT PERIOD FOR BENEFITS IN 2003- The processes developed under
subsections (a) and (b) shall ensure that eligible beneficiaries are permitted
to enroll under this part and with an eligible entity prior to January 1,
2003, in order to ensure that coverage under this part is effective as of such
date.
`PROVIDING ENROLLMENT AND COVERAGE INFORMATION TO BENEFICIARIES
`SEC. 1860C. (a) ACTIVITIES- The Commissioner shall provide for activities
under this part to broadly disseminate information to eligible beneficiaries
(and prospective eligible beneficiaries) regarding enrollment under this part
and the prescription drug coverage made available by eligible entities with a
contract under this part.
`(b) SPECIAL RULE FOR FIRST ENROLLMENT UNDER THE PROGRAM- To the extent
practicable, the activities described in subsection (a) shall ensure that
eligible beneficiaries are provided with such information at least 60 days
prior to the first enrollment period described in section 1860B(c).
`ENROLLEE PROTECTIONS
`SEC. 1860D. (a) GUARANTEED ISSUE AND NONDISCRIMINATION-
`(A) IN GENERAL- An eligible beneficiary who is eligible to enroll
with an eligible entity under section 1860B(b) for prescription drug
coverage under this part at a time during which elections are accepted
under this part with respect to the coverage shall not be denied
enrollment based on any health status-related factor (described in section
2702(a)(1) of the Public Health Service Act) or any other factor.
`(B) MEDICARE+CHOICE LIMITATIONS PERMITTED- The provisions of
paragraphs (2) and (3) (other than subparagraph (C)(i), relating to
default enrollment) of section 1851(g) (relating to priority and
limitation on termination of election) shall apply to eligible entities
under this subsection.
`(2) NONDISCRIMINATION- An eligible entity offering prescription drug
coverage under this part shall not establish a service area in a manner that
would discriminate based on health or economic status of potential
enrollees.
`(b) DISSEMINATION OF INFORMATION-
`(1) GENERAL INFORMATION- An eligible entity with a contract under this
part shall disclose, in a clear, accurate, and standardized form to each
eligible beneficiary enrolled for prescription drug coverage with such
entity under this part at the time of enrollment and at least annually
thereafter, the information described in section 1852(c)(1) relating to such
prescription drug coverage. Such information includes the following:
`(A) Access to covered outpatient drugs, including access through
pharmacy networks.
`(B) How any formulary used by the eligible entity functions.
`(C) Grievance and appeals procedures.
`(2) DISCLOSURE UPON REQUEST OF GENERAL COVERAGE, UTILIZATION, AND
GRIEVANCE INFORMATION- Upon request of an eligible beneficiary, the eligible
entity shall provide the information described in section 1852(c)(2) (other
than subparagraph (D)) to such beneficiary.
`(3) RESPONSE TO BENEFICIARY QUESTIONS- Each eligible entity offering
prescription drug coverage under this part shall have a mechanism for
providing specific information to enrollees upon request. The entity shall
make available, through an Internet website and in writing upon request,
information on specific changes in its formulary.
`(c) ACCESS TO COVERED BENEFITS-
`(1) ENSURING PHARMACY ACCESS-
`(A) IN GENERAL- Each eligible entity with a contract under this part
shall permit any pharmacy located in the area covered by such contract to
participate in the pharmacy network of the eligible entity if the pharmacy
agrees to
accept such operating terms as the eligible entity may specify, including any
fee schedule, requirements relating to covered expenses, and quality standards
relating to the provision of prescription drug coverage.
`(B) CONSTRUCTION- Nothing in this paragraph shall be construed as
requiring a pharmacy to participate in a pharmacy network of an eligible
entity with a contract under this part to participate in any other
coverage program of the eligible entity.
`(2) ACCESS TO NEGOTIATED PRICES FOR PRESCRIPTION DRUGS- For
requirements relating to the access of an eligible beneficiary to negotiated
prices (including applicable discounts), see section 1860F(a).
`(3) REQUIREMENTS ON DEVELOPMENT AND APPLICATION OF FORMULARIES- Insofar
as an eligible entity with a contract under this part uses a formulary, the
following requirements must be met:
`(A) FORMULARY COMMITTEE- The eligible entity must establish a
pharmaceutical and therapeutic committee that develops the formulary. Such
committee shall include at least 1 physician and at least 1
pharmacist.
`(B) INCLUSION OF DRUGS IN ALL THERAPEUTIC CATEGORIES- The formulary
must include drugs within all therapeutic categories and classes of
covered outpatient drugs (although not necessarily for all drugs within
such categories and classes).
`(C) APPEALS AND EXCEPTIONS TO APPLICATION- The entity must have, as
part of the appeals process under subsection (f)(2), a process for appeals
for denials of coverage based on such application of the
formulary.
`(d) COST AND UTILIZATION MANAGEMENT; QUALITY ASSURANCE; MEDICATION
THERAPY MANAGEMENT PROGRAM-
`(1) IN GENERAL- For purposes of providing access to negotiated benefits
under section 1860F(a) and the catastrophic benefit described in section
1860F(b), the eligible entity shall have in place--
`(A) an effective cost and drug utilization management program,
including appropriate incentives to use generic drugs, when
appropriate;
`(B) quality assurance measures and systems to reduce medical errors
and adverse drug interactions, including a medication therapy management
program described in paragraph (2); and
`(C) a program to control fraud, abuse, and waste.
`(2) MEDICATION THERAPY MANAGEMENT PROGRAM-
`(A) IN GENERAL- A medication therapy management program described in
this paragraph is a program of drug therapy management and medication
administration provided by a community-based pharmacy that is designed to
ensure that prescription drugs made available under this part are
appropriately used to achieve therapeutic goals and reduce the risk of
adverse events, including adverse drug interactions.
`(B) ELEMENTS- Such program shall include--
`(i) enhanced beneficiary understanding of such appropriate use
through beneficiary education, counseling, and other appropriate means;
and
`(ii) increased beneficiary adherence with prescription medication
regimens through medication refill reminders, special packaging, and
other appropriate means.
`(C) DEVELOPMENT OF PROGRAM IN COOPERATION WITH LICENSED PHARMACISTS-
The program shall be developed in cooperation with licensed pharmacists
and physicians.
`(D) CONSIDERATIONS IN PHARMACY FEES- An eligible entity with a
contract under this part shall establish fees for pharmacists, pharmacies,
and others providing services under the medication therapy management
program that take into account the resources and time used in implementing
the program.
`(3) TREATMENT OF ACCREDITATION- Section 1852(e)(4) (relating to
treatment of accreditation) shall apply to prescription drug coverage
provided under this part with respect to the following requirements, in the
same manner as they apply to Medicare+Choice plans under part C with respect
to the requirements described in a clause of section 1852(e)(4)(B):
`(A) Subsection (c)(1) (relating to access to covered
benefits).
`(B) Subsection (g) (relating to confidentiality and accuracy of
enrollee records).
`(e) GRIEVANCE MECHANISM- Each eligible entity shall provide meaningful
procedures for hearing and resolving grievances between the organization
(including any entity or individual through which the eligible entity provides
covered benefits) and eligible beneficiaries enrolled with the entity under
this part in accordance with section 1852(f).
`(f) COVERAGE DETERMINATIONS, RECONSIDERATIONS, AND APPEALS-
`(1) IN GENERAL- An eligible entity shall meet the requirements of
section 1852(g) with respect to covered benefits under the prescription drug
coverage it offers under this part in the same manner as such requirements
apply to a Medicare+Choice organization with respect to benefits it offers
under a Medicare+Choice plan under part C.
`(2) APPEALS OF FORMULARY DETERMINATIONS- Under the appeals process
under paragraph (1) an individual who is enrolled with an eligible entity
with a contract under this part for prescription drug coverage may appeal
any denial of coverage of a prescription drug to obtain coverage for a
medically necessary covered outpatient drug that is not on the formulary of
the eligible entity (established
under subsection (c)) if the prescribing physician determines that the
therapeutically similar drug that is on the formulary is not effective for the
enrollee or has significant adverse effects for the enrollee.
`(g) CONFIDENTIALITY AND ACCURACY OF ENROLLEE RECORDS- An eligible entity
shall meet the requirements of section 1852(h) with respect to enrollees under
this part in the same manner as such requirements apply to a Medicare+Choice
organization with respect to enrollees under part C.
`ANNUAL ENROLLMENT FEE
`(1) IN GENERAL- Except as provided in subsection (c), enrollment under
the program under this part is conditioned upon payment of an annual
enrollment fee of $25.
`(2) ANNUAL PERCENTAGE INCREASE-
`(A) IN GENERAL- In the case of any calendar year beginning after
2003, the dollar amount in paragraph (1) shall be increased by an amount
equal to--
`(i) such dollar amount; multiplied by
`(ii) the inflation adjustment.
`(B) INFLATION ADJUSTMENT- For purposes of subparagraph (A)(ii), the
inflation adjustment for any calendar year is the percentage (if any) by
which--
`(i) the average per capita aggregate expenditures for covered
outpatient drugs in the United States for medicare beneficiaries, as
determined by the Commissioner for the 12-month period ending in July of
the previous year; exceeds
`(ii) such aggregate expenditures for the 12-month period ending
with July 2003.
`(C) ROUNDING- If any increase determined under clause (ii) is not a
multiple of $1, such increase shall be rounded to the nearest multiple of
$1.
`(b) COLLECTION OF ANNUAL ENROLLMENT FEE-
`(1) IN GENERAL- Unless the eligible beneficiary makes an election under
paragraph (2), the annual enrollment fee described in subsection (a) shall
be collected and credited to the Federal Supplementary Medical Insurance
Trust Fund in the same manner as the monthly premium determined under
section 1839 is collected and credited to such Trust Fund under section
1840.
`(2) DIRECT PAYMENT- An eligible beneficiary may elect to pay the annual
enrollment fee directly or in any other manner approved by the Commissioner.
The Commissioner shall establish procedures for making such an
election.
`(c) WAIVER- The Commissioner shall waive the enrollment fee described in
subsection (a) in the case of an eligible beneficiary whose income is below
200 percent of the poverty line.
`BENEFITS UNDER THE PROGRAM
`SEC. 1860F. (a) ACCESS TO NEGOTIATED PRICES-
`(A) IN GENERAL- Subject to subparagraph (B), each eligible entity
with a contract under this part shall provide each eligible beneficiary
enrolled with the entity with access to negotiated prices (including
applicable discounts) for such prescription drugs as the eligible entity
determines appropriate. If such a beneficiary becomes eligible for the
catastrophic benefit under subsection (b), the negotiated prices
(including applicable discounts) shall continue to be available to the
beneficiary for those prescription drugs for which payment may not be made
under section 1860H(b). For purposes of this subparagraph, the term
`prescription drugs' is not limited to covered outpatient drugs, but does
not include any over-the-counter drug that is not a covered outpatient
drug.
`(i) FORMULARY RESTRICTIONS- Insofar as an eligible entity with a
contract under this part uses a formulary, the negotiated prices
(including applicable discounts) for prescription drugs shall only be
available for drugs included in such formulary.
`(ii) AVOIDANCE OF DUPLICATE COVERAGE- The negotiated prices
(including applicable discounts) for prescription drugs shall not be
available for any drug prescribed for an eligible beneficiary if payment
for the drug is available under part A or B (but such negotiated prices
shall be available if payment under part A or B is not available because
the beneficiary has not met the deductible or has exhausted benefits
under part A or B).
`(2) DISCOUNT CARD- The Commissioner shall develop a uniform standard
card format to be issued by each eligible entity that may be used by an
enrolled beneficiary to ensure the access of such beneficiary to negotiated
prices under paragraph (1).
`(3) ENSURING DISCOUNTS IN ALL AREAS- The Commissioner shall develop
procedures that ensure that each eligible beneficiary that resides in an
area where no eligible entity has been awarded a contract under this part is
provided with access to negotiated prices for prescription drugs (including
applicable discounts).
`(b) CATASTROPHIC BENEFIT-
`(1) IN GENERAL- Subject to paragraph (4) (relating to eligibility for
the catastrophic benefit) and any formulary used by the eligible entity with
which the eligible beneficiary is enrolled, the catastrophic benefit shall
be administered as follows:
`(A) BENEFICIARIES WITH ANNUAL INCOMES BELOW 200 PERCENT OF THE
POVERTY LINE- In the case of an eligible beneficiary whose modified
adjusted gross income (as defined in paragraph (4)(E)) is below 200
percent of the poverty line, the beneficiary shall not be responsible for
making a payment for a covered
outpatient drug provided to the beneficiary in a year to the extent that the
out-of-pocket expenses of the beneficiary for such drug, when added to the
out-of-pocket expenses of the beneficiary for covered outpatient drugs
previously provided in the year, exceed $1,200.
`(B) BENEFICIARIES WITH ANNUAL INCOMES BETWEEN 200 AND 400 PERCENT OF
THE POVERTY LINE- In the case of an eligible beneficiary whose modified
adjusted gross income (as so defined) exceeds 200 percent, but does not
exceed 400 percent, of the poverty line, the beneficiary shall not be
responsible for making a payment for a covered outpatient drug provided to
the beneficiary in a year to the extent that the out-of-pocket expenses of
the beneficiary for such drug, when added to the out-of-pocket expenses of
the beneficiary for covered outpatient drugs previously provided in the
year, exceed $2,500.
`(C) BENEFICIARIES WITH ANNUAL INCOMES ABOVE 400 PERCENT OF THE
POVERTY LINE- In the case of an eligible beneficiary whose modified
adjusted gross income (as so defined) exceeds 400 percent of the poverty
line, the beneficiary shall not be responsible for making a payment for a
covered outpatient drug provided to the beneficiary in a year to the
extent that the out-of-pocket expenses of the beneficiary for such drug,
when added to the out-of-pocket expenses of the beneficiary for covered
outpatient drugs previously provided in the year, exceed $5,000.
`(2) ANNUAL PERCENTAGE INCREASE-
`(A) IN GENERAL- In the case of any calendar year after 2003, the
dollar amounts in paragraph (1) shall be increased by an amount equal
to--
`(i) such dollar amount; multiplied by
`(ii) the inflation adjustment determined under section
1860E(a)(2)(B) for such calendar year.
`(B) ROUNDING- If any increase determined under subparagraph (A) is
not a multiple of $1, such increase shall be rounded to the nearest
multiple of $1.
`(3) ELIGIBLE ENTITY NOT AT RISK FOR CATASTROPHIC BENEFIT-
`(A) IN GENERAL- The Commissioner, and not the eligible entity, shall
be at risk for the provision of the catastrophic benefit under this
subsection.
`(B) PROVISIONS RELATING TO PAYMENTS TO ELIGIBLE ENTITIES- For
provisions relating to payments to eligible entities for administering the
catastrophic benefit under this subsection, see section 1860H.
`(4) CATASTROPHIC BENEFIT NOT AVAILABLE TO CERTAIN HIGH INCOME
INDIVIDUALS-
`(A) IN GENERAL- An eligible beneficiary enrolled under this part
whose modified adjusted gross income for a taxable year exceeds 600
percent of the poverty line shall not be eligible for the catastrophic
benefit under this subsection.
`(B) BENEFICIARY STILL ELIGIBLE FOR DISCOUNT BENEFIT- Nothing in
subparagraph (A) shall be construed as affecting the eligibility of a
beneficiary described in such subparagraph for the benefits under
subsection (a).
`(C) PROCEDURES FOR DETERMINING MODIFIED ADJUSTED GROSS
INCOME-
`(i) IN GENERAL- The Commissioner shall establish procedures for
determining the modified adjusted gross income of eligible beneficiaries
enrolled under this part.
`(ii) CONSULTATION- The Commissioner shall consult with the
Secretary of the Treasury in making the determinations described in
clause (i).
`(iii) DISCLOSURE OF INFORMATION- Notwithstanding section 6103(a) of
the Internal Revenue Code of 1986, the Secretary of the Treasury may,
upon written request from the Commissioner, disclose to officers and
employees of the Medicare Prescription Drug Agency such return
information as is necessary to make the determinations described in
clause (i). Return information disclosed under the preceding sentence
may be used by officers and employees of the Medicare Prescription Drug
Agency only for the purposes of, and to the extent necessary in, making
such determinations.
`(D) DEFINITION OF MODIFIED ADJUSTED GROSS INCOME- In this paragraph,
the term `modified adjusted gross income' means adjusted gross income (as
defined in section 62 of the Internal Revenue Code of 1986)--
`(i) determined without regard to sections 135, 911, 931, and 933 of
such Code; and
`(ii) increased by the amount of interest received or accrued by the
taxpayer during the taxable year which is exempt from tax under such
Code.
`(5) ENSURING CATASTROPHIC BENEFIT IN ALL AREAS- The Commissioner shall
develop procedures for the provision of the catastrophic benefit under this
subsection to each eligible beneficiary that resides in an area where there
are no eligible entities that have been awarded a contract under this
part.
`SELECTION OF ENTITIES TO PROVIDE PRESCRIPTION DRUG COVERAGE
`SEC. 1860G. (a) ESTABLISHMENT OF BIDDING PROCESS- The Commissioner shall
establish a process under which the Commissioner accepts bids from eligible
entities and awards contracts to the entities to provide the benefits under
this part to eligible beneficiaries in an area.
`(b) SUBMISSION OF BIDS- Each eligible entity desiring to enter into a
contract under this part shall submit a bid to the Commissioner at such time,
in such manner,
and accompanied by such information as the Commissioner may reasonably
require.
`(c) AWARDING OF CONTRACTS-
`(1) IN GENERAL- The Commissioner shall, consistent with the
requirements of this part and the goal of containing medicare program costs,
award at least 2 contracts in each area, unless only 1 bidding entity meets
the terms and conditions specified by the Commissioner under paragraph
(2).
`(2) TERMS AND CONDITIONS- The Commissioner shall not award a contract
to an eligible entity under this section unless the Commissioner finds that
the eligible entity is in compliance with such terms and conditions as the
Commissioner shall specify.
`(3) COMPARATIVE MERITS- In determining which of the eligible entities
that submitted bids that meet the terms and conditions specified by the
Commissioner under paragraph (2) to award a contract, the Commissioner shall
consider the comparative merits of each of the bids.
`PAYMENTS TO ELIGIBLE ENTITIES FOR ADMINISTERING THE CATASTROPHIC
BENEFIT
`SEC. 1860H. (a) IN GENERAL- The Commissioner shall establish procedures
for making payments to an eligible entity under a contract entered into under
this part for--
`(1) providing covered outpatient prescription drugs to beneficiaries
eligible for the catastrophic benefit in accordance with subsection (b);
and
`(2) costs incurred by the entity in administering the catastrophic
benefit in accordance with subsection (c).
`(b) PAYMENT FOR COVERED OUTPATIENT PRESCRIPTION DRUGS-
`(1) IN GENERAL- Except as provided in subsection (c) and subject to
paragraph (2), the Commissioner may only pay an eligible entity for covered
outpatient drugs furnished by the eligible entity to an eligible beneficiary
enrolled with such entity under this part that is eligible for the
catastrophic benefit under section 1860F(b).
`(A) FORMULARY RESTRICTIONS- Insofar as an eligible entity with a
contract under this part uses a formulary, the Commissioner may not make
any payment for a covered outpatient drug that is not included in such
formulary.
`(B) NEGOTIATED PRICES- The Commissioner may not pay an amount for a
covered outpatient drug furnished to an eligible beneficiary that exceeds
the negotiated price (including applicable discounts) that the beneficiary
would have been responsible for under section 1860F(a).
`(c) PAYMENT FOR ADMINISTRATIVE COSTS-
`(1) PROCEDURES- The procedures established under subsection (a)(1)
shall provide for payment to the eligible entity of an administrative fee
for each prescription filled by the entity for an eligible
beneficiary--
`(A) who is enrolled with the entity; and
`(B) to whom subparagraph (A), (B), or (C) of section 1860F(b)(1)
applies with respect to a covered outpatient drug.
`(2) AMOUNT- The fee described in paragraph (1) shall be--
`(A) negotiated by the Commissioner; and
`(B) consistent with such fees paid under private sector
pharmaceutical benefit contracts.
`(d) SECONDARY PAYER PROVISIONS- The provisions of section 1862(b) shall
apply to the benefits provided under this part.
`DETERMINATION OF INCOME LEVELS
`SEC. 1860I. (a) PROCEDURES- The Commissioner shall establish procedures
for determining the income levels of eligible beneficiaries for purposes of
sections 1860E(c) and 1860F(b).
`(b) PERIODIC REDETERMINATIONS- Such income determinations shall be valid
for a period (of not less than 1 year) specified by the Commissioner.
`APPROPRIATIONS
`SEC. 1860J. There are authorized to be appropriated from time to time,
out of any moneys in the Treasury not otherwise appropriated, to the Federal
Supplementary Medical Insurance Trust Fund established under section 1841, an
amount equal to the amount by which the benefits and administrative costs of
providing the benefits under this part exceed the enrollment fees collected
under section 1860E.
`Subpart 2--Establishment of the Medicare Prescription Drug Agency
`MEDICARE PRESCRIPTION DRUG AGENCY
`SEC. 1860S. (a) ESTABLISHMENT- There is established, as an independent
agency in the executive branch of the Government, a Medicare Prescription Drug
Agency (in this part referred to as the `Agency').
`(b) DUTY- It shall be the duty of the Agency to administer the Medicare
Outpatient Prescription Drug Discount and Security Program under subpart 1.
`COMMISSIONER; DEPUTY COMMISSIONER; OTHER OFFICERS
`SEC. 1860T. (a) COMMISSIONER OF MEDICARE PRESCRIPTION DRUGS-
`(1) APPOINTMENT- There shall be in the Agency a Commissioner of
Medicare Prescription Drugs (in this subpart referred to as the
`Commissioner') who shall be appointed by the President, by and with the
advice and consent of the Senate.
`(2) COMPENSATION- The Commissioner shall be compensated at the rate
provided for level I of the Executive Schedule.
`(A) IN GENERAL- The Commissioner shall be appointed for a term of 6
years.
`(B) CONTINUANCE IN OFFICE- In any case in which a successor does not
take office at the end of a Commissioner's term of office, such
Commissioner may continue in office until the appointment of a
successor.
`(C) DELAYED APPOINTMENTS- A Commissioner appointed to a term of
office after the commencement of such term may serve under such
appointment only for the remainder of such term.
`(D) REMOVAL- An individual serving in the office of Commissioner may
be removed from office only under a finding by the President of neglect of
duty or malfeasance in office.
`(4) RESPONSIBILITIES- The Commissioner shall be responsible for the
exercise of all powers and the discharge of all duties of the Agency, and
shall have authority and control over all personnel and activities
thereof.
`(5) PROMULGATION OF RULES AND REGULATIONS-
`(A) IN GENERAL- The Commissioner may prescribe such rules and
regulations as the Commissioner determines necessary or appropriate to
carry out the functions of the Agency.
`(B) RULEMAKING- The regulations prescribed by the Commissioner shall
be subject to the rulemaking procedures established under section 553 of
title 5, United States Code.
`(6) DELEGATION OF AUTHORITY-
`(A) IN GENERAL- The Commissioner may assign duties, and delegate, or
authorize successive redelegations of, authority to act and to render
decisions, to such officers and employees of the Agency as the
Commissioner may find necessary.
`(B) EFFECT OF DELEGATION- Within the limitations of such delegations,
redelegations, or assignments, all official acts and decisions of such
officers and employees shall have the same force and effect as though
performed or rendered by the Commissioner.
`(7) CONSULTATION WITH SECRETARY OF HEALTH AND HUMAN SERVICES- The
Commissioner and the Secretary shall consult, on an ongoing basis, to ensure
the coordination of the programs administered by the Commissioner with the
programs administered by the Secretary under this title and under title
XIX.
`(b) DEPUTY COMMISSIONER OF MEDICARE PRESCRIPTION DRUGS-
`(1) APPOINTMENT- There shall be in the Agency a Deputy Commissioner of
Medicare Prescription Drugs (in this subpart referred to as the `Deputy
Commissioner') who shall be appointed by the President, by and with the
advice and consent of the Senate.
`(A) IN GENERAL- The Deputy Commissioner shall be appointed for a term
of 6 years.
`(B) CONTINUANCE IN OFFICE- In any case in which a successor does not
take office at the end of a Deputy Commissioner's term of office, such
Deputy Commissioner may continue in office until the entry upon office of
such a successor.
`(C) DELAYED APPOINTMENT- A Deputy Commissioner appointed to a term of
office after the commencement of such term may serve under such
appointment only for the remainder of such term.
`(3) COMPENSATION- The Deputy Commissioner shall be compensated at the
rate provided for level II of the Executive Schedule.
`(A) IN GENERAL- The Deputy Commissioner shall perform such duties and
exercise such powers as the Commissioner shall from time to time assign or
delegate.
`(B) ACTING COMMISSIONER- The Deputy Commissioner shall be Acting
Commissioner of the Agency during the absence or disability of the
Commissioner, unless the President designates another officer of the
Government as Acting Commissioner, in the event of a vacancy in the office
of the Commissioner.
`(A) IN GENERAL- There shall be in the Agency a Chief Actuary, who
shall be appointed by, and in direct line of authority to, the
Commissioner.
`(B) QUALIFICATIONS- The Chief Actuary shall be appointed from
individuals who have demonstrated, by their education and experience,
superior expertise in the actuarial sciences.
`(C) DUTIES- The Chief Actuary shall serve as the chief actuarial
officer of the Agency, and shall exercise such duties as are appropriate
for the office of the Chief Actuary and in accordance with professional
standards of actuarial independence.
`(2) COMPENSATION- The Chief Actuary shall be compensated at the highest
rate of basic pay for the Senior Executive Service under section 5382(b) of
title 5, United States Code.
`ADMINISTRATIVE DUTIES OF THE COMMISSIONER
`SEC. 1860U. (a) PERSONNEL-
`(1) IN GENERAL- The Commissioner may employ, without regard to chapter
31 of title 5, United States Code, such officers and employees as are
necessary to administer the activities to be carried out through the
Medicare Prescription Drug Agency.
`(2) FLEXIBILITY WITH RESPECT TO CIVIL SERVICE LAWS-
`(A) IN GENERAL- The staff of the Medicare Prescription Drug Agency
shall be appointed without regard to the provisions of title 5, United
States Code, governing appointments in the competitive service, and,
subject to subparagraph (B), shall be paid without regard to the
provisions of chapters 51 and 53 of such title (relating to classification
and schedule pay rates).
`(B) MAXIMUM RATE- In no case may the rate of compensation determined
under subparagraph (A) exceed the rate of basic pay payable for level IV
of the Executive Schedule under section 5315 of title 5, United States
Code.
`(1) SUBMISSION OF ANNUAL BUDGET- The Commissioner shall prepare an
annual budget for the Agency, which shall be submitted by the President to
Congress without revision, together with the President's annual budget for
the Agency.
`(2) APPROPRIATIONS REQUESTS-
`(A) STAFFING AND PERSONNEL- Appropriations requests for staffing and
personnel of the Agency shall be based upon a comprehensive workforce
plan, which shall be established and revised from time to time by the
Commissioner.
`(B) ADMINISTRATIVE EXPENSES- Appropriations for administrative
expenses of the Agency are authorized to be provided on a biennial
basis.
`(1) IN GENERAL- The Commissioner shall cause a Seal of Office to be
made for the Agency of such design as the Commissioner shall approve.
`(2) JUDICIAL NOTICE- Judicial notice shall be taken of the seal made
under paragraph (1).
`(1) DISCLOSURE OF RECORDS AND OTHER INFORMATION- Notwithstanding any
other provision of law (including subsections (b), (o), (p), (q), (r), and
(u) of section 552a of title 5, United States Code)--
`(A) the Secretary shall disclose to the Commissioner any record or
information requested in writing by the Commissioner for the purpose of
administering any program administered by the Commissioner, if records or
information of such type were disclosed to the Administrator of the Health
Care Financing Administration in the Department of Health and Human
Services under applicable rules, regulations, and procedures in effect
before the date of enactment of the Medicare Rx Drug Discount and Security
Act of 2001; and
`(B) the Commissioner shall disclose to the Secretary or to any State
any record or information requested in writing by the Secretary to be so
disclosed for the purpose of administering any program administered by the
Secretary, if records or information of such type were so disclosed under
applicable rules, regulations, and procedures in effect before the date of
enactment of the Medicare Rx Drug Discount and Security Act of
2001.
`(2) EXCHANGE OF OTHER DATA- The Commissioner and the Secretary shall
periodically review the need for exchanges of information not referred to in
paragraph (1) and shall enter into such agreements as may be necessary and
appropriate to provide information to each other or to States in order to
meet the programmatic needs of the requesting agencies.
`(A) IN GENERAL- Any disclosure from a system of records (as defined
in section 552a(a)(5) of title 5, United States Code) pursuant to this
subsection shall be made as a routine use under subsection (b)(3) of
section 552a of such title (unless otherwise authorized under such section
552a).
`(B) COMPUTERIZED COMPARISON- Any computerized comparison of records,
including matching programs, between the Commissioner and the Secretary
shall be conducted in accordance with subsections (o), (p), (q), (r), and
(u) of section 552a of title 5, United States Code.
`(4) TIMELY ACTION- The Commissioner and the Secretary shall each ensure
that timely action is taken to establish any necessary routine uses for
disclosures required under paragraph (1) or agreed to under paragraph
(2).
`MEDICARE COMPETITION AND PRESCRIPTION DRUG ADVISORY BOARD
`SEC. 1860V. (a) ESTABLISHMENT OF BOARD- There is established a Medicare
Prescription Drug Advisory Board (in this section referred to as the
`Board').
`(b) ADVICE ON POLICIES; REPORTS-
`(1) ADVICE ON POLICIES- On and after the date the Commissioner takes
office, the Board shall advise the Commissioner on policies relating to the
Medicare Outpatient Prescription Drug Discount and Security Program under
subpart 1.
`(A) IN GENERAL- With respect to matters of the administration of
subpart 1, the Board shall submit to Congress and to the Commissioner of
Medicare Prescription Drugs such reports as the Board determines
appropriate. Each such report may contain such recommendations as the
Board determines appropriate for legislative or administrative changes to
improve the administration of such subpart. Each such report shall be
published in the Federal Register.
`(B) MAINTAINING INDEPENDENCE OF BOARD- The Board shall directly
submit to Congress reports required under subparagraph (A). No officer or
agency of the United States may require the Board to submit to any officer
or agency of the United States for approval, comments, or review, prior to
the submission to Congress of such reports.
`(c) STRUCTURE AND MEMBERSHIP OF THE BOARD-
`(1) MEMBERSHIP- The Board shall be composed of 7 members who shall be
appointed as follows:
`(A) PRESIDENTIAL APPOINTMENTS-
`(i) IN GENERAL- Three members shall be appointed by the President,
by and with the advice and consent of the Senate.
`(ii) LIMITATION- Not more than 2 such members may be from the same
political party.
`(B) SENATORIAL APPOINTMENTS- Two members (each member from a
different political party) shall be appointed by the President pro tempore
of the Senate with the advice of
the Chairman and the Ranking Minority Member of the Committee on Finance of
the Senate.
`(C) CONGRESSIONAL APPOINTMENTS- Two members (each member from a
different political party) shall be appointed by the Speaker of the House
of Representatives, with the advice of the Chairman and the Ranking
Minority Member of the Committee on Ways and Means of the House of
Representatives.
`(2) QUALIFICATIONS- The members shall be chosen on the basis of their
integrity, impartiality, and good judgment, and shall be individuals who
are, by reason of their education, experience, and attainments,
exceptionally qualified to perform the duties of members of the Board.
`(d) TERMS OF APPOINTMENT-
`(1) IN GENERAL- Subject to paragraph (2), each member of the Board
shall serve for a term of 6 years.
`(2) CONTINUANCE IN OFFICE AND STAGGERED TERMS-
`(A) CONTINUANCE IN OFFICE- A member appointed to a term of office
after the commencement of such term may serve under such appointment only
for the remainder of such term.
`(B) STAGGERED TERMS- The terms of service of the members initially
appointed under this section shall begin on January 1, 2002, and expire as
follows:
`(i) PRESIDENTIAL APPOINTMENTS- The terms of service of the members
initially appointed by the President shall expire as designated by the
President at the time of nomination, 1 each at the end of--
`(ii) SENATORIAL APPOINTMENTS- The terms of service of members
initially appointed by the President pro tempore of the Senate shall
expire as designated by the President pro tempore of the Senate at the
time of nomination, 1 each at the end of--
`(iii) CONGRESSIONAL APPOINTMENTS- The terms of service of members
initially appointed by the Speaker of the House of Representatives shall
expire as designated by the Speaker of the House of Representatives at
the time of nomination, 1 each at the end of--
`(C) REAPPOINTMENTS- Any person appointed as a member of the Board may
not serve for more than 8 years.
`(D) VACANCIES- Any member appointed to fill a vacancy occurring
before the expiration of the term for which the member's predecessor was
appointed shall be appointed only for the remainder of that term. A member
may serve after the expiration of that member's term until a successor has
taken office. A vacancy in the Board shall be filled in the manner in
which the original appointment was made.
`(e) CHAIRPERSON- A member of the Board shall be designated by the
President to serve as Chairperson for a term of 4 years, coincident with the
term of the President, or until the designation of a successor.
`(f) EXPENSES AND PER DIEM- Members of the Board shall serve without
compensation, except that, while serving on business of the Board away from
their homes or regular places of business, members may be allowed travel
expenses, including per diem in lieu of subsistence, as authorized by section
5703 of title 5, United States Code, for persons in the Government employed
intermittently.
`(1) IN GENERAL- The Board shall meet at the call of the Chairperson (in
consultation with the other members of the Board) not less than 4 times each
year to consider a specific agenda of issues, as determined by the
Chairperson in consultation with the other members of the Board.
`(2) QUORUM- Four members of the Board (not more than 3 of whom may be
of the same political party) shall constitute a quorum for purposes of
conducting business.
`(h) FEDERAL ADVISORY COMMITTEE ACT- The Board shall be exempt from the
provisions of the Federal Advisory Committee Act (5 U.S.C. App.).
`(1) STAFF DIRECTOR- The Board shall, without regard to the provisions
of title 5, United States Code, relating to the competitive service, appoint
a Staff Director who shall be paid at a rate equivalent to a rate
established for the Senior Executive Service under section 5382 of title 5,
United States Code.
`(A) IN GENERAL- The Board may employ, without regard to chapter 31 of
title 5, United States Code, such officers and employees as are necessary
to administer the activities to be carried out by the Board.
`(B) FLEXIBILITY WITH RESPECT TO CIVIL SERVICE LAWS-
`(i) IN GENERAL- The staff of the Board shall be appointed without
regard to the provisions of title 5, United States Code, governing
appointments in the competitive service, and, subject to clause (ii),
shall be paid without regard to the provisions of chapters 51 and 53 of
such title (relating to classification and schedule pay
rates).
`(ii) MAXIMUM RATE- In no case may the rate of compensation
determined under clause (i) exceed the rate of basic pay payable for
level IV of the Executive
Schedule under section 5315 of title 5, United States Code.
`(j) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be
appropriated, out of the Federal Supplemental Medical Insurance Trust Fund
established under section 1841, and the general fund of the Treasury, such
sums as are necessary to carry out the purposes of this section.'.
(b) CONFORMING REFERENCES TO PREVIOUS PART D-
(1) IN GENERAL- Any reference in law (in effect before the date of
enactment of this Act) to part D of title XVIII of the Social Security Act
is deemed a reference to part E of such title (as in effect after such
date).
(2) SECRETARIAL SUBMISSION OF LEGISLATIVE PROPOSAL- Not later than 6
months after the date of enactment of this section, the Secretary of Health
and Human Services shall submit to the appropriate committees of Congress a
legislative proposal providing for such technical and conforming amendments
in the law as are required by the provisions of this section.
(1) IN GENERAL- The amendment made by subsection (a) shall take effect
on the date of enactment of this Act.
(2) TIMING OF INITIAL APPOINTMENTS- The Commissioner and Deputy
Commissioner of Medicare Prescription Drugs may not be appointed before
March 1, 2002.
SEC. 3. COMMISSIONER AS MEMBER OF THE BOARD OF TRUSTEES OF THE MEDICARE
TRUST FUNDS.
(a) IN GENERAL- Section 1841(b) of the Social Security Act (42 U.S.C.
1395t(b)) is amended by striking `and the Secretary of Health and Human
Services, all ex officio,' and inserting `, the Secretary of Health and Human
Services, and the Commissioner of Medicare Prescription Drugs, all ex
officio,'.
(b) EFFECTIVE DATE- The amendment made by this subsection shall take
effect on March 1, 2002.
SEC. 4. EXCLUSION OF PART D COSTS FROM DETERMINATION OF PART B MONTHLY
PREMIUM.
Section 1839(g) of the Social Security Act (42 U.S.C. 1395r(g)) is
amended--
(1) by striking `attributable to the application of section' and
inserting `attributable to--
`(1) the application of section';
(2) by striking the period and inserting `; and'; and
(3) by adding at the end the following new paragraph:
`(2) the Voluntary Medicare Outpatient Prescription Drug Discount and
Security Program under part D.'.
SEC. 5. MEDIGAP REVISIONS.
Section 1882 of the Social Security Act (42 U.S.C. 1395ss) is amended by
adding at the end the following new subsection:
`(v) MODERNIZATION OF MEDICARE SUPPLEMENTAL POLICIES-
`(1) PROMULGATION OF MODEL REGULATION-
`(A) NAIC MODEL REGULATION- If, within 9 months after the date of
enactment of the Medicare Rx Drug Discount and Security Act of 2001, the
National Association of Insurance Commissioners (in this subsection
referred to as the `NAIC') changes the 1991 NAIC Model Regulation
(described in subsection (p)) to revise the benefit package classified as
`J' under the standards established by subsection (p)(2) (including the
benefit package classified as `J' with a high deductible feature, as
described in subsection (p)(11)) so that--
`(i) the coverage for outpatient prescription drugs available under
such benefit package is replaced with coverage for outpatient
prescription drugs that complements but does not duplicate the benefits
for outpatient prescription drugs that beneficiaries are otherwise
entitled to under this title;
`(ii) a uniform format is used in the policy with respect to such
revised benefits; and
`(iii) such revised standards meet any additional requirements
imposed by the Medicare Rx Drug Discount and Security Act of
2001;
subsection (g)(2)(A) shall be applied in each State, effective for
policies issued to policy holders on and after January 1, 2003, as if the
reference to the Model Regulation adopted on June 6, 1979, were a
reference to the 1991 NAIC Model Regulation as changed under this
subparagraph (such changed regulation referred to in this section as the
`2003 NAIC Model Regulation').
`(B) REGULATION BY THE SECRETARY- If the NAIC does not make the
changes in the 1991 NAIC Model Regulation within the 9-month period
specified in subparagraph (A), the Secretary shall promulgate, not later
than 9 months after the end of such period, a regulation and subsection
(g)(2)(A) shall be applied in each State, effective for policies issued to
policy holders on and after January 1, 2003, as if the reference to the
Model Regulation adopted on June 6, 1979, were a reference to the 1991
NAIC Model Regulation as changed by the Secretary under this subparagraph
(such changed regulation referred to in this section as the `2003 Federal
Regulation').
`(C) CONSULTATION WITH WORKING GROUP- In promulgating standards under
this paragraph, the NAIC or Secretary shall consult with a working group
similar to the working group described in subsection (p)(1)(D).
`(D) MODIFICATION OF STANDARDS IF MEDICARE BENEFITS CHANGE- If
benefits under part D of this title are changed and the
Secretary determines, in consultation with the NAIC, that changes in the 2003
NAIC Model Regulation or 2003 Federal Regulation are needed to reflect such
changes, the preceding provisions of this paragraph shall apply to the
modification of standards previously established in the same manner as they
applied to the original establishment of such standards.
`(2) CONSTRUCTION OF BENEFITS IN OTHER MEDICARE SUPPLEMENTAL POLICIES-
Nothing in the benefit packages classified as `A' through `I' under the
standards established by subsection (p)(2) (including the benefit package
classified as `F' with a high deductible feature, as described in subsection
(p)(11)) shall be construed as providing coverage for benefits for which
payment may be made under part D.
`(3) APPLICATION OF PROVISIONS AND CONFORMING REFERENCES-
`(A) APPLICATION OF PROVISIONS- The provisions of paragraphs (4)
through (10) of subsection (p) shall apply under this section, except
that--
`(i) any reference to the model regulation applicable under that
subsection shall be deemed to be a reference to the applicable 2003 NAIC
Model Regulation or 2003 Federal Regulation; and
`(ii) any reference to a date under such paragraphs of subsection
(p) shall be deemed to be a reference to the appropriate date under this
subsection.
`(B) OTHER REFERENCES- Any reference to a provision of subsection (p)
or a date applicable under such subsection shall also be considered to be
a reference to the appropriate provision or date under this
subsection.'.
END