I 111th CONGRESS 1st Session H. R. 2758 IN THE HOUSE OF REPRESENTATIVES June 8, 2009 Mr. Kind (for himself and Ms. Baldwin) 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 part C of title XVIII of the Social Security Act with respect to Medicare special needs plans and the alignment of Medicare and Medicaid for dually eligible individuals, and for other purposes.

1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Medicare Specialty Care Improvement and Protection Act of 2009. (b)

Table of contents

The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Extension of SNP authority through December 31, 2013. Sec. 3. Improve risk adjustment for high-risk, high-cost beneficiaries. Sec. 4. Additional enhancements to ensure payment equity for specialized MA plans. Sec. 5. Advance alignment of Medicare and Medicaid for dual eligibles. Sec. 6. Continuous eligibility for Medicaid for certain individuals. Sec. 7. Definitions.

2.

Extension of SNP authority through December 31, 2013

Section 1859(f) of the Social Security Act (42 U.S.C. 1395w–28(f)), as amended by section 164(a) of the Medicare Improvements for Patients and Providers Act of 2008 (Public Law 110–275), is amended by striking 2011 and inserting 2014 (or before January 1, 2016, in the case of a Fully Integrated Dual Eligible Special Needs Plan designated under section 5(a)(1)(A) of the Medicare Specialty Care Improvement and Protection Act of 2009).

3.

Improve risk adjustment for high-risk, high-cost beneficiaries

(a)

Evaluation

(1)

In general

The Secretary shall evaluate the Medicare Advantage risk adjustment payment mechanism under section 1853(a)(1)(C) of the Social Security Act (42 U.S.C. 1395w–23(a)(1)(C)) and the risk adjustment payment mechanism under section 1860D–15(c)(1)(A) of such Act (42 U.S.C. 1395w–115(c)(1)(A)) in order to resolve plan payment inequities relative to Medicare fee-for-service payments for beneficiaries identified under paragraph (2). (2)

Requirements

The evaluation conducted under paragraph (1) shall address the need for improving the adequacy of the existing hierarchical condition categories and pharmacy risk adjustment methods for Medicare Advantage plans that exclusively or disproportionately serve high-risk beneficiaries as it relates to— (A)accurately predicting costs relative to Medicare fee-for-service for beneficiaries with— (i)sustained high-risk scores over multiple contract periods; (ii)sustained high costs over multiple contract periods; (iii)co-morbid chronic conditions; (iv)diagnoses not included in the risk-adjustment methodology, including dementia and other cognitive impairments; (v)physical disabilities, developmental disabilities, or both; and (vi)frailty; (B)accurately predicting costs relative to Medicare fee-for-service for beneficiaries near the end of life; (C)accurately predicting costs relative to Medicare fee-for-service for other conditions for which the current risk adjustment methodology underpays in relation to Medicare fee-for-service, as determined by the Secretary; (D)further gradations of diseases and conditions to better reflect stage of condition, condition severity, and costs related to burden of illness; (E)accounting for costs of pre-existing conditions at the time of initial enrollment for new entrants into Medicare; and (F)enhancing coding persistency by calculating risk scores using data covering at least 2 years. (b)

Use of the results of the study for refinements

(1)

Refinements

(A)

In general

Beginning with plan year 2011, the Secretary, using the results of the evaluation conducted under subsection (a)(1), shall refine the risk adjustment payment mechanisms referred to in subsection (a)(1) for beneficiaries identified under subsection (a)(2). The Secretary shall make additional refinements, as appropriate, for subsequent plan years. (B)

Protection

To the extent that the Secretary determines that the risk adjustment payment mechanisms referred to in subsection (a)(1) do not accurately pay for Medicare beneficiaries identified under subsection (a)(2), the Secretary shall ensure that no Medicare Advantage plan that exclusively or disproportionately serves high-risk beneficiaries is paid less, in the aggregate, than 100 percent of Medicare fee-for-service payment rates (as determined under section 1853(c)(1)(D)(i)). (C)

Recalibration

Beginning with plan year 2011, the Secretary shall recalibrate the risk adjustment payment mechanisms referred to in subsection (a)(1) so that the overall predicted costs for all Medicare beneficiaries are identical to what they would have been in the absence of the new risk adjustment payment mechanism. (2)

Budget neutral adjustments

If the Secretary determines that the application of paragraph (1) results in expenditures under title XVIII of the Social Security Act that exceed the expenditures under such title that would have been made without such application, the Secretary shall provide for an appropriate adjustment to payment rates under part C of such title for beneficiaries for whom the risk adjustment payment mechanism overpays in relation to Medicare fee-for-service in order to eliminate such excess.

4.

Additional enhancements to ensure payment equity for specialized MA plans

(a)

Accounting for added regulatory costs

For plan year 2011 and subsequent plan years, the Secretary shall provide bonus payments to account for added SNP costs associated with additional benefit, care management, reporting, and other requirements established by Congress and the Secretary in excess of other Medicare Advantage plans. (b)

Ensuring fair bidding practices

For plan year 2011 and subsequent plan years, the Secretary shall take into account the following factors with respect to the bid structure for SNPs: (1)Dual eligibility. (2)Geographic cost differences. (3)Population characteristics. (4)The differences in plan requirements, including differences in additional benefits, care management, and reporting requirements. (5)The differences between community-based and regional or nationally based plans. (c)

Authority To apply PACE rules

For plan year 2011 and subsequent plan years, the Secretary may apply the payment rules under section 1894(d) of the Social Security Act (42 U.S.C. 1395eee(d)) to Fully Integrated Dual Eligible Special Needs Plans rather than the payment rules that would otherwise apply to such plans under part C. (d)

Budget neutral adjustments

If the Secretary determines that the application of subsections (a), (b), and (c) result in expenditures under title XVIII of the Social Security Act that exceed the expenditures under such title that would have been made without such application, the Secretary shall provide for an appropriate adjustment to payment rates under part C of such title for beneficiaries for whom the risk adjustment payment mechanism overpays in relation to Medicare fee-for-service in order to eliminate such excess.

5.

Advance alignment of Medicare and Medicaid for dual eligibles

(a)

Medicare and Medicaid integration programs

(1)

Designation

(A)

In general

For plan year 2011 and subsequent plan years, the Secretary shall have in place a process under which the Secretary designates dual eligible SNPs as Fully Integrated Dual Eligible Special Needs Plans for the purpose of advancing fully integrated Medicare and Medicaid benefits and services for dual beneficiaries, including State designated Dual subsets. (B)

Criteria for designation

In order to be designated as a Fully Integrated Dual Eligible Special Needs Plan, the dual eligible SNP shall meet the following requirements: (i)The dual eligible SNP provides dual eligibles with access to Medicare and Medicaid benefits specified by the State for Medicaid beneficiaries enrolled in integrated programs under a single managed care organization (MCO). (ii)The dual eligible SNP has a contract in place with a State Medicaid agency that includes coverage of specified primary, acute, and long-term care benefits and services, consistent with State policy, under risk-based financing. (iii)The dual eligible SNP coordinates the delivery of covered Medicare and Medicaid health and long-term care services, consistent with State policy, using aligned care management and specialty care network methods for high-risk beneficiaries. (iv)The dual eligible SNP employs policies and procedures approved by the Secretary and the State to coordinate or integrate enrollment, member materials, communications, grievance and appeals, and quality assurance. (v)The dual eligible SNP provides advanced person-centered, integrated care for the full array of primary, acute, and residential and home and community-based long-term care services, using a robust advanced medical home model that— (I)empowers dual eligibles with serious chronic conditions and their family caregivers to optimize their health and well-being; (II)provides a comprehensive array of patient-centered benefits and services designed to meet the unique needs of dual eligibles; (III)helps dual eligibles and their family caregivers to access the right care, at the right time, in the right place, given the nature of their condition; (IV)aligns the incentives of related care providers to improve transitions and care continuity; and (V)optimizes total quality and cost performance across time, place, and profession. (2)

Integration authority

In order to increase simplicity for dual eligibles in accessing and coordinating Medicare and Medicaid benefits, the Secretary, working in conjunction with States, on a State by State basis, consistent with existing statutory authority, is encouraged to establish a single administrative structure and process under titles XVIII and XIX for Fully Integrated Dual Eligible Special Needs Plans, under a three-way contract or Memorandum of Understanding, among CMS, the State, and related plans, for— (A)the enrollment of dual eligibles; (B)member materials and related communications; (C)care management and model of care requirements; (D)reporting, auditing, and performance evaluation; (E)grievance and appeals procedures; and (F)payment methods. (3)

Alignment of Medicare and Medicaid policies and procedures for SNPs serving dual eligibles

In order to increase simplicity for dual eligibles in accessing and coordinating Medicare and Medicaid benefits by enhancing coordination between CMS and State Medicaid agencies in the oversight of SNPs insofar as they serve dual eligibles, the Secretary, working in collaboration with State Medicaid Agencies, may modify rules, policies, and procedures under titles XVIII and XIX of such Act in order to provide for the alignment of Medicare and Medicaid requirements, including marketing, enrollment, care coordination, auditing, reporting, quality assurance, and other relevant oversight functions. (4)

Reports to Congress

(A)

Interim report

Not later than December 31, 2013, the Secretary shall submit to Congress an interim report on the impact of integrating Medicare and Medicaid benefits and services on total quality and cost performance in serving dual eligibles. (B)

Final report

Not later than December 31, 2015, the Secretary shall submit to Congress a final report on the impact of integrating Medicare and Medicaid benefits and services on total quality and cost performance in serving dual eligibles. (C)

Requirement

A report under subparagraph (A) and (B) shall include recommendations for such legislative and administrative actions as the Secretary determines appropriate to further advance Medicare and Medicaid integration, including options for integrating Medicare and Medicaid funding, to facilitate ongoing improvements in total quality and cost performance in care of dual eligibles. (D)

Quality and cost performance

Not later than 6 months after the date of the enactment of this Act, the Secretary, working in consultation with consumers, plans, and States, shall identify the measures and benchmarks to be used for evaluating cost and quality performance for purposes of subparagraph (C). (b)

Office of Medicare/Medicaid Integration

(1)

Establishment

The Secretary shall establish or designate an Office on Medicare/Medicaid Integration (in this subsection referred to as the Office) for the purpose of aligning Medicare and Medicaid policies and procedures and developing tools to support State integration efforts in order to— (A)simplify dual eligible access to Medicare and Medicaid benefits and services; (B)improve care continuity and ensure safe and effective care transitions; (C)eliminate cost shifting between Medicare and Medicaid and among related care providers; (D)eliminate regulatory conflicts between Medicare and Medicaid rules; and (E)improve total cost and quality performance. (2)

Responsibilities

The responsibilities of the Office are to develop policies and procedures to— (A)oversee the designation, implementation, and oversight of Fully Integrated Dual Eligible Special Needs Plans under subsection (a)(1) in collaboration with the States, with authority to effectively align Medicare and Medicaid policy for dual eligibles; (B)provide State Medicaid agencies with training, materials, technical assistance, and other resources in support of advancing Medicare and Medicaid integration in States where Fully Integrated Dual Eligible Special Needs Plans have been designated and other integration initiatives are being advanced to coordinate and align primary, acute, and long-term care benefits for dual eligibles through a State plan option or other means; (C)identify incentives for States to advance the integration of Medicare and Medicaid to improve total cost and quality performance, including shared cost savings among consumers, plans, and Federal and State governments with respect to State initiatives for advancing Medicare and Medicaid integration; (D)support State efforts to coordinate and align acute and long-term care benefits for dual eligibles through a State plan option or other means; (E)provide support for coordination of State and Federal contracting and oversight for dual integration programs supportive of the goals described in paragraph (1); (F)align Federal rules for Medicaid managed care and Medicare Advantage Plans to include methods for integrating marketing, enrollment, grievances and appeals, auditing, reporting, quality assurance, and other relevant oversight functions; (G)serve as a liaison between CMS central and regional offices to ensure consistent application of CMS rules, policies, and auditing practices as such rules, policies, and auditing practices pertain to dual eligibles; (H)monitor total combined Medicare and Medicaid costs in serving dual eligibles and make recommendations for optimizing total quality and cost performance across both programs; and (I)work with the Congressional Budget Office and the Office of Management and Budget to establish a process for evaluating total Medicare and Medicaid spending for dual eligibles who are enrolled in Fully Integrated Dual Eligible Special Needs Plans such that the enrollment of such dual eligibles in such plans is treated as budget neutral if the combined Medicare and Medicaid costs under such plans do not exceed the combined costs of providing Medicare and Medicaid services on a fee-for-service basis for a comparable risk group. (3)

Funding

For each of fiscal years 2010 through 2014, of the amount of the reductions in payments attributable to average per capita monthly savings described in paragraph (3)(C) or (4)(C) of section 1854(b) of the Social Security Act that are not provided as a monthly rebate under paragraph (1)(C) of such section, $2,000,000 shall be available for purposes of funding the Office.

6.

Continuous eligibility for Medicaid for certain individuals

(a)

In general

Section 1902(e) of the Social Security Act (42 U.S.C. 1396a(e)) is amended by adding at the end the following: (14)The plan shall provide that an individual who has attained age 65 and has been determined for a period of 12 consecutive months to be a full-benefit dual eligible individual (as defined in section 1935(c)(6)) shall be presumed to remain eligible for benefits under the plan without any need for further redetermination or recertification. . (b)

Effective date

The amendment made by subsection (a) takes effect on January 1, 2010.

7.

Definitions

In this Act: (1)

CMS

The term CMS means the Centers for Medicare & Medicaid Services. (2)

Dual eligible

The term dual eligible means an MA eligible individual (as defined in section 1851(a)(3) of the Social Security Act, 42 U.S.C. 13195w–21(a)(3)) who is also entitled to medical assistance under a State plan under title XIX of the Social Security Act. (3)

Dual eligible SNP

The term dual eligible SNP means a SNP described in section 1859(b)(6)(A)(ii) of the Social Security Act. (4)

Medicaid

The term Medicaid means the program under title XIX of the Social Security Act. (5)

Medicare

The term Medicare means the program under title XVIII of the Social Security Act. (6)

Medicare fee-for-service

The term Medicare fee-for-service means the original Medicare fee-for-service program under parts A and B of title XVIII of the Social Security Act. (7)

Secretary

The term Secretary means the Secretary of Health and Human Services. (8)

SNP

The term SNP means a specialized MA plan for special needs individuals, as defined in section 1859(b)(6)(A) of the Social Security Act (42 U.S.C. 1395w–28(b)(6)(A)). (9)

State

The term State has the meaning given such term for purposes of title XIX of the Social Security Act.