[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 3029 Introduced in Senate (IS)]







106th CONGRESS
  2d Session
                                S. 3029

To amend part C of title XVIII to stabilize the Medicare+Choice program 
  by improving the methodology for the calculation of Medicare+Choice 
                 payment rates, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 12, 2000

 Mr. Santorum introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To amend part C of title XVIII to stabilize the Medicare+Choice program 
  by improving the methodology for the calculation of Medicare+Choice 
                 payment rates, and for other purposes.

    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 
Beneficiaries' Choice Stabilization Act of 2000''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Establishment of payment floor for Medicare+Choice payment 
                            rates after applying risk-adjustment 
                            methodology.
Sec. 3. Change in application of budget neutrality adjustment for 2001 
                            and 2002.
Sec. 4. Increase in national per capita Medicare+Choice growth 
                            percentage in 2001 and 2002.
Sec. 5. Increasing minimum payment amount.
Sec. 6. Allowing movement to 50:50 percent blend in 2002.
Sec. 7. Increased update for payment areas with only one or no 
                            Medicare+Choice contracts.
Sec. 8. Permitting higher negotiated rates in certain Medicare+Choice 
                            payment areas below national average.
Sec. 9. 10-year phase in of risk adjustment based on data from all 
                            settings.
Sec. 10. Delay from July to November, 2000 in deadline for offering and 
                            withdrawing Medicare+Choice plans for 2001.
Sec. 11. Miscellaneous regulatory changes.

SEC. 2. ESTABLISHMENT OF PAYMENT FLOOR FOR MEDICARE+CHOICE PAYMENT 
              RATES AFTER APPLYING RISK-ADJUSTMENT METHODOLOGY.

    (a) In General.--Section 1853(c)(1) of the Social Security Act (42 
U.S.C. 1395w-23(c)(1)) is amended--
            (1) in the matter preceding subparagraph (A), by striking 
        `or (C)' and inserting `(C), or (D)'; and
            (2) by adding at the end the following new subparagraph:
                    ``(D) Demographically adjusted fee-for-service per 
                capita expenditures.--
                            ``(i) In general.--For 2001 and each 
                        subsequent year, 90 percent of the adjusted 
                        average per capita cost for the year for the 
                        Medicare+Choice payment area determined by the 
                        Secretary based upon the rule specified under 
                        paragraph (4) of section 1876(a) and calculated 
                        without regard to the adjustment under 
                        paragraph (1)(C) of such section.
                            ``(ii) Special rule for risk adjustment.--
                        For purposes of applying risk adjustment to the 
                        payment amount determined under this 
                        subparagraph for a demographic class, the risk 
                        adjustment for such demographic class shall be 
                        determined under the methodology applied by the 
                        Secretary under section 1876(a)(4) without 
                        regard to subsection (a)(3) of this section.''.
    (b) Continuation of Computation of AAPCC Data.--Section 1853(b) of 
such Act (42 U.S.C. 1395w-23(b)) is amended by adding at the end the 
following new paragraph:
            ``(4) Continued computation and publication of county-
        specific per capita fee-for-service expenditure information.--
        Using the most recent data available, the Secretary shall 
        provide for the computation and publication, on an annual basis 
        at the time of publication of the annual Medicare+Choice 
        capitation rates, of information on the level of the average 
        annual per capita costs (described in section 1876(a)(4)) for 
        each Medicare+Choice payment area.''.

SEC. 3. ELIMINATION OF BUDGET NEUTRALITY ADJUSTMENT FOR 2001 AND 2002.

    Section 1853(c) of the Social Security Act (42 U.S.C. 1395w-23(c)) 
is amended--
            (1) in paragraph (1)(A) in the matter following clause 
        (ii), by inserting ``for a year (other than 2001 or 2002)'' 
        after ``multiplied''; and
            (2) in paragraph (5), by inserting ``(other than 2001 or 
        2002)'' after ``for each year''.

SEC. 4. INCREASE IN NATIONAL PER CAPITA MEDICARE+CHOICE GROWTH 
              PERCENTAGE IN 2001 AND 2002.

    Section 1853(c)(6)(B) of the Social Security Act (42 U.S.C. 1395w-
23(c)(6)(B)) is amended--
            (1) in clause (iv), by striking ``for 2001, 0.5 percentage 
        points'' and inserting ``for 2001, 0 percentage points''; and
            (2) in clause (v), by striking ``for 2002, 0.3 percentage 
        points'' and inserting ``for 2002, 0 percentage points''.

SEC. 5. INCREASING MINIMUM PAYMENT AMOUNT.

    (a) In General.--Section 1853(c)(1)(B)(ii) of the Social Security 
Act (42 U.S.C. 1395w-23(c)(1)(B)(ii)) is amended--
            (1) by striking ``(ii) For a succeeding year'' and 
        inserting ``(ii)(I) Subject to subclause (II), for a succeeding 
        year''; and
            (2) by adding at the end the following new subclause:
                            ``(II) For 2001 for any of the 50 States 
                        and the District of Columbia, $475.''.
    (b) Effective Date.--The amendments made by subsection (a) apply to 
years beginning with 2001.

SEC. 6. ALLOWING MOVEMENT TO 50:50 PERCENT BLEND IN 2002.

    Section 1853(c)(2) of the Social Security Act (42 U.S.C. 1395w-
23(c)(2)) is amended--
            (1) by striking the period at the end of subparagraph (F) 
        and inserting a semicolon; and
            (2) by adding after and below subparagraph (F) the 
        following:
        ``except that a Medicare+Choice organization may elect to apply 
        subparagraph (F) (rather than subparagraph (E)) for 2001 and 
        for 2002.''.

SEC. 7. INCREASED UPDATE FOR PAYMENT AREAS WITH ONLY ONE OR NO 
              MEDICARE+CHOICE CONTRACTS.

    (a) In General.--Section 1853(c)(1)(C)(ii) of the Social Security 
Act (42 U.S.C. 1395w-23(c)(1)(C)(ii)) is amended--
            (1) by striking ``(ii) For a subsequent year'' and 
        inserting ``(ii)(I) Subject to subclause (II), for a subsequent 
        year''; and
            (2) by adding at the end the following new subclause:
                            ``(II) During 2001, 2002, 2003, 2004, and 
                        2005, in the case of a Medicare+Choice payment 
                        area in which there is no more than one 
                        contract entered into under this part as of 
                        July 1 before the beginning of the year, 102.5 
                        percent of the annual Medicare+Choice 
                        capitation rate under this paragraph for the 
                        area for the previous year.''.
    (b) Construction.--The amendments made by subsection (a) do not 
affect the payment of a first time bonus under section 1853(i) of the 
Social Security Act (42 U.S.C. 1395w-23(i)).

SEC. 8. PERMITTING HIGHER NEGOTIATED RATES IN CERTAIN MEDICARE+CHOICE 
              PAYMENT AREAS BELOW NATIONAL AVERAGE.

    Section 1853(c)(1) of the Social Security Act (42 U.S.C. 1395w-
23(c)(1)) is amended--
            (1) in the matter before subparagraph (A), by striking ``or 
        (C)'' and inserting ``(C), or (D)''; and
            (2) by adding at the end the following new subparagraph:
                    ``(D) Permitting higher rates through 
                negotiation.--
                            ``(i) In general.--For each year beginning 
                        with 2004, in the case of a Medicare+Choice 
                        payment area for which the Medicare+Choice 
                        capitation rate under this paragraph would 
                        otherwise be less than the United States per 
                        capita cost (USPCC), as calculated by the 
                        Secretary, a Medicare+Choice organization may 
                        negotiate with the Secretary an annual per 
                        capita rate that--
                                    ``(I) reflects an annual rate of 
                                increase up to the rate of increase 
                                specified in clause (ii);
                                    ``(II) takes into account audited 
                                current data supplied by the 
                                organization on its adjusted community 
                                rate (as defined in section 
                                1854(f)(3)); and
                                    ``(III) does not exceed the United 
                                States per capita cost, as projected by 
                                the Secretary for the year involved.
                            ``(ii) Maximum rate described.--The rate of 
                        increase specified in this clause for a year is 
                        the rate of inflation in private health 
                        insurance for the year involved, as projected 
                        by the Secretary, and includes such adjustments 
                        as may be necessary--
                                    ``(I) to reflect the demographic 
                                characteristics in the population under 
                                this title; and
                                    ``(II) to eliminate the costs of 
                                prescription drugs.
                            ``(iii) Adjustments for over or under 
                        projections.--If subparagraph is applied to an 
                        organization and payment area for a year, in 
                        applying this subparagraph for a subsequent 
                        year the provisions of paragraph (6)(C) shall 
                        apply in the same manner as such provisions 
                        apply under this paragraph.''.

SEC. 9. 10-YEAR PHASE IN OF RISK ADJUSTMENT BASED ON DATA FROM ALL 
              SETTINGS.

    Section 1853(a)(3)(C)(ii) of the Social Security Act (42 U.S.C. 
1395w-23(c)(1)(C)(ii)) is amended--
            (1) by striking the period at the end of subclause (II) and 
        inserting a semicolon; and
            (2) by adding after and below subclause (II) the following:
                        ``and, beginning in 2004, insofar as such risk 
                        adjustment is based on data from all (or 
                        substantially all) settings, the methodology 
                        shall be phased in equal increments over a 10 
                        year period, beginning with 2004 or (if later) 
                        the first year in which such data is used.''.

SEC. 10. DELAY FROM JULY TO NOVEMBER, 2000 IN DEADLINE FOR OFFERING AND 
              WITHDRAWING MEDICARE+CHOICE PLANS FOR 2001.

    Notwithstanding any other provision of law, the deadline for a 
Medicare+Choice organization to withdraw the offering of a 
Medicare+Choice plan under part C of title XVIII of the Social Security 
Act (or otherwise to submit information required for the offering of 
such a plan) for 2001 is delayed from July 1, 2000, to November 1, 
2000, and any such organization that provided notice of withdrawal of 
such a plan during 2000 before the date of the enactment of this Act 
may rescind such withdrawal at any time before November 1, 2000.

SEC. 11. MISCELLANEOUS REGULATORY CHANGES.

    (a) Prohibition on Requirement to Submit Encounter Data.--Section 
1853(a)(3)(B) of the Social Security Act (42 U.S.C. 1395w-23(a)(3)(B)) 
is amended--
            (1) by designating the matter following ``Data collection'' 
        as a clause (i) with appropriate indentation and the heading 
        ``In general''; and
            (2) by adding at the end the following new clauses:
                            ``(ii) Issuance of data submission 
                        requirements.--The Secretary may not require 
                        under clause (i) the submission of encounter 
                        data to support a risk adjustment methodology 
                        based on all (or substantially all) settings 
                        until a reasonable time after the Secretary 
                        issues the complete requirements for data 
                        submission. Such requirements shall be limited 
                        to the minimum data elements necessary to 
                        support the risk adjustment methodology. Such 
                        system shall be designed to accept the required 
                        minimum data elements in a form and manner 
                        compatible with Medicare+Choice organizations' 
operations.
                            ``(iii) Evaluation.--In issuing such data 
                        submission requirements, the Secretary must 
                        include an evaluation by an outside, 
                        independent actuary of whether the proposed 
                        data elements are the minimum necessary to 
                        support the risk adjustment methodology.''.
    (b) Post-Stabilization Guidelines.--Section 1852(d)(2) of such Act 
(42 U.S.C. 1395w-22(d)(2)) is amended by adding at the end the 
following: ``In prescribing such guidelines--
                    ``(A) post-stabilization care shall be limited to 
                care related to treatment of the condition that 
                precipitated the provision of emergency services; and
                    ``(B) the provider of emergency services is not 
                authorized to provide post-stabilization care unless--
                            ``(i) the Medicare+Choice organization has 
                        been notified as soon as practicable, but not 
                        later than 2 hours after stabilization, in 
                        advance of the request to provide such care;
                            ``(ii) the organization has either approved 
                        the request or not responded to such request 
                        within a reasonable period (of at least 3 
                        hours) after it has been notified; and
                            ``(iii) the emergency services provider 
                        maintains a written documentation concerning 
                        the notice and the organization's response to 
                        such notice.''.
    (c) Enrollment Process.--
            (1) Allowing on-line enrollment.--Section 1851(c)(2) of 
        such Act (42 U.S.C. 1395w-21(c)(2)) is amended by adding at the 
        end the following:
                    ``(C) On-line applications.--Such process shall 
                permit the filing of appropriate election forms under 
                subparagraphs (A) and (B) to be done through electronic 
                means (including use of the Internet).''.
            (2) Moratorium on changes in medicare+choice enrollment 
        rules.--The Secretary of Health and Human Services shall not 
        make any changes in the enrollment and disenrollment 
        instructions and related materials (including operational 
        policy letters and evidence of coverage) under the 
        Medicare+Choice program under part C of title XVIII of the 
        Social Security Act between the date of the enactment of this 
        Act and January 1, 2002, except as may be specifically and only 
        required to comply with a change in statute.
                                 <all>