[Congressional Record Volume 145, Number 14 (Tuesday, January 26, 1999)]
[Senate]
[Page S1011]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. WYDEN (for himself and Mr. Smith of Oregon):
  S. 307. A bill to amend title XVIII of the Social Security Act to 
eliminate the budget neutrality adjustment factor used in calculating 
the blended capitation rate for Medicare+Choice organizations; to the 
Committee on Finance.


               medicare+choice payment equity act of 1999

 Mr. WYDEN. Mr. President, my colleague from Oregon Senator 
Gordon Smith, and I are introducing this legislation today to correct 
an inequity in the payment formula for Medicare+Choice plans. In states 
like Oregon, with historically low cost health care systems, these 
inequities leave many Medicare beneficiaries with few or no choices in 
their health care services.
  The Balanced Budget Act of 1997 contained a promise to provide 
seniors with more choices, but that promise has gone unfulfilled 
because of these inequities.
  The legislation that Senator Smith and I are introducing today will 
fulfill that promise by fully funding what is known as the ``blend'' 
portion of the formula used to determine payment rates. The legislation 
brings parity to areas that have been historically efficient in 
delivering health care services. Under the current system, the Medicare 
payment formula has not rewarded these areas for their efficiency and 
low costs. As a result, beneficiaries in these areas have not received 
the range of benefits available in areas with less efficient and more 
costly health care systems.
  This legislation also assures beneficiaries will no longer be 
penalized because they live in a rural or low-cost area. We must assure 
that seniors living in Oregon and other low cost areas receive the full 
promise of Medicare+Choice.
  With managed care playing a larger role in Medicare, this bill is 
needed now more than ever. Nearly 100 plans elected to drop out of the 
Medicare program for 1999. Many of those plans served seniors in low 
cost and rural areas, leaving too many beneficiaries not only without 
choice but also out in the cold. Other managed care plans made benefit 
changes that limit the promise we all had hoped would occur through 
Medicare+Choice.
  We need to make sure that all seniors are included in the 
Medicare+Choice promise and that managed care plans in Oregon, Iowa and 
other low-cost areas are no longer penalized because of their historic 
efficiency. Senator Smith and I urge our colleagues to support this 
bill.
  I would like to thank Senator Smith and his staff for their 
assistance, and ask unanimous consent that a copy of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 307

       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 ``Medicare+Choice Payment 
     Equity Act of 1999''.

     SEC. 2. ELIMINATION OF BUDGET NEUTRALITY ADJUSTMENT FACTOR IN 
                   CALCULATING THE BLENDED CAPITATION RATE FOR 
                   MEDICARE+CHOICE ORGANIZATIONS.

       (a) In General.--Section 1853(c) of the Social Security Act 
     (42 U.S.C. 1395w-23(c)) is amended--
       (1) in paragraph (1)(A), by striking the comma at the end 
     of clause (ii) and all that follows before the period at the 
     end; and
       (2) by striking paragraph (5) and redesignating paragraphs 
     (6) and (7) as paragraphs (5) and (6) respectively.
       (b) Conforming Amendments.--Part C of title XVIII of the 
     Social Security Act (42 U.S.C. 1395w-21 et seq.) is amended--
       (1) in section 1853(c)--
       (A) in the matter preceding subparagraph (A) of paragraph 
     (1), by striking ``(6)(C) and (7)'' and inserting ``(5)(C) 
     and (6)''; and
       (B) in paragraphs (1)(B)(ii) and (3)(A)(i), by striking 
     ``(6)(A)'' and inserting ``(5)(A)''; and
       (2) in subsections (b)(3)(B)(ii) and (c)(3) of section 
     1859, by striking ``1853(c)(6)'' and inserting 
     ``1853(c)(5)''.
       (c) Submission to Congress.--Not later than 20 days after 
     the date of enactment of this Act, the Secretary of Health 
     and Human Services shall submit to Congress a legislative 
     proposal that provides for aggregate decreases in Federal 
     expenditures under the medicare program under title XVIII of 
     the Social Security Act (42 U.S.C. 1395 et seq.) as are equal 
     to the aggregate increases in such expenditures under such 
     program resulting from the amendments to the Social Security 
     Act made by subsections (a) and (b).
       (d) Effective Date.--The amendments made by this section 
     shall apply to payments made for periods beginning on or 
     after January 1, 2000.
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