[Congressional Record Volume 147, Number 177 (Wednesday, December 19, 2001)]
[Senate]
[Pages S13707-S13709]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BINGAMAN (for himself, Mr. Chafee, Mr. Rockefeller, Mr. 
        Kennedy, Mr. Feingold, Mr. Corzine, Mr. Reed, Mrs. Clinton, Mr. 
        Kerry, and Mr. Kohl):
  S. 1851. A bill to amend part C of title XVIII, of the Social 
Security Act to provide for continuous open enrollment and 
disenrollment in Medicare+Choice plans and for other purposes; to the 
Committee on Finance.
  Mr. BINGAMAN. Mr. President, the legislation I am introducing today 
with Senators Chafee, Rockefeller, Kennedy, Feingold, Corzine, Reed, 
Clinton, Kerry, and Kohl entitled the Medicare+Choice Consumer 
Protection Act is designed to ensure protections for Medicare+Choice 
beneficiaries that are witnessing increased costs, decreased benefits, 
and fewer options to obtain affordable supplemental coverage for 
Medicare.
  This legislation is a companion bill to H.R. 3267, legislation 
introduced by Representative Pete Stark.
  The Medicare+Choice program is an important option for many seniors 
and the disabled in this country, including 15 percent of seniors in 
the State of New Mexico. This option must remain a viable one in the 
Medicare program, but due to the recent rounds of plan withdrawals, 
benefit reductions, and cost increases that plans have undertaken 
within the program, there has been a growing level of insecurity among 
Medicare beneficiaries with respect to their health coverage.
  Last year, I sponsored legislation, S. 2905, the Medicare+Choice 
Program Improvement Act of 2000, to increase payments, including the 
minimum payment amount to Medicare+Choice plans. However, despite 
payment increases approved by the Congress last year, including some 
substantial increases in certain more rural areas of the country, we 
have witnessed over 530,000 people recently lose their Medicare+Choice 
coverage as a result of HMO pull-outs from the Medicare program, 
including some in areas that received these much higher payments.
  Many others have also experienced increases in their costs through 
the HMO or benefit reductions, including the elimination or substantial 
reduction of prescription drug coverage.
  Therefore, while we must continue to explore mechanisms to ensure 
that the Medicare+Choice program remains a viable one, it is clear that 
even if their push for higher payments is met that the plans may still 
choose to pull-out of areas, decrease benefits, or increase costs to 
seniors. Despite ads being run by some Medicare+Choice plans that they 
will provide ``health care for life,'' Medicare beneficiaries are 
seeing constant turmoil and change on a yearly basis. Some Medicare 
Beneficiaries have been dropped to have seen their benefits reduced or 
costs increased by HMO's on yearly basis since the creation of the 
Medicare+Choice program in 1997.
  In New Mexico, the result of last year's payment increases have 
resulted in a mixed outcome. Presbyterian's Medicare+Choice plan has 
reported that they are on track to achieve a profit margin of 3 to 4 
percent on its M+C product in 2001 compared to a loss of around 15 
percent in the prior year. In contrast, St. Joseph's M+C plan received 
the substantial increase in its Medicare payment, and yet, eliminated 
prescription drug coverage to seniors through its HMO without notice to 
some seniors this past March and still reports the system is up for 
sale and may completely change this coming year.

  Beneficiaries are often left confused and uncertain. As 96 year-old 
Beulah Torrez of Espanola, New Mexico, said after the last round of 
Medicare+Choice plan changes, ``I just finally gave up. I couldn't 
afford anything. I couldn't afford the HMOs.''
  As we continue to seek ways to improve Medicare+Choice coverage, we 
should take immediate action to extend important consumer protections 
to Medicare beneficiaries who find themselves in a plan that no longer 
meets their needs. To achieve these goals, the bill we are introducing 
today would.
  (1) Eliminate the Medicare+Choice lock-in scheduled to go into effect 
in January 2002.
  (2) Extend the existing Medigap protections that apply to people 
whose Medicare+Choice plan withdraws from the program to anyone whose 
Medicare+Choice plan changes benefits or whose doctor or hospital 
leaves the plan.
  (3) Prevent Medicare+Choice plans from charging higher cost-sharing 
for a service than Medicare charges in the fee-for-service program.
  Eliminating the lock-in would ensure that seniors and people with 
disabilities continue to be allowed to leave a health plan that is not 
meeting their needs. When St. Joseph's health plan eliminated 
prescription drug coverage from its Medicare plan earlier this year, 
Medicare beneficiaries were left without drug coverage but were at 
least able to change their health plan at the end of the month. This 
flexibility will end in January 2002 unless this legislation is passed. 
It is important that Medicare beneficiaries, often our nation's most 
vulnerable citizens, know that if they test an HMO and do not like its 
system, arrangements and rules that they will be able to leave and 
choose a Medicare option that better suits their specific needs. Both 
advocates and the managed care industry support this provision.
  In addition, if a Medicare+Choice plan withdraws from a community or 
Medicare entirely, you can under current law move into a select 
category of Medigap plans, (A, B, C and F, without any individual 
health underwriting. this provision ensures that Medicare beneficiaries 
have affordable supplemental Medicare options available to them when, 
through no fault of their own, their Medicare+Choice plan withdrawals.

[[Page S13708]]

  However, these protections for Medicare beneficiaries currently do 
not apply with Medicare+Choice plans that make significant changes, 
such as eliminating benefits, increasing cost sharing, or changing 
available providers, within the HMO but stop short of completely 
withdrawing from the Medicare program. In the St. Joseph's case I 
mentioned above, seniors were unable to receive important Medigap or 
supplemental Medicare coverage since the plan did not completely 
withdraw from the service area.

  For Medicare beneficiaries whose needs no longer are met by the HMO 
due to such changes, a Medigap supplemental policy and a return to 
Medicare fee-for-service may often make better sense. Therefore, it is 
critical to extend the current Medigap protections for when a plan 
terminates Medicare participation to beneficiaries in plans that have 
made important changes to the benefits, cost sharing, or provider 
options.
  And finally, the third provision of the bill would prevent 
Medicare+Choice plans from charging higher cost-sharing for individual 
services than occurs in the Medicare fee-for-service program. According 
to testimony before the House Ways and Means Health Subcommittee by 
Thomas Scully, Administrator for the Centers for Medicare and Medicaid 
Services, CMS, on December 4, 2001,

       . . . this year we have found that some plans proposed 
     charging beneficiaries what we believed were unreasonably 
     high copays for particular services .  .  . Thus, we have a 
     new challenge balancing the need for plans to make decisions 
     about their benefit packages and cost sharing amounts with 
     the important requirement that plan designs do not discourage 
     enrollment. The concern is always that high cost sharing 
     could discourage beneficiaries, who have greater health care 
     needs, from enrolling in or remaining a member of these 
     particular plans.

  In the case of UnitedHealth Group's Medicare Complete option in 
Wisconsin, that plan will begin charging a deductible of $295 a day for 
a hospital stay up to a cap of $4,800 compared to a similar stay under 
fee-for-service Medicare which has a deductible of $812. While CMS did 
require the plan to reduce their proposed deductible from $350 to $295 
per day, overall out-of-pocket costs can far exceed those that would 
occur in fee-for-service for many beneficiaries.
  As Stephanie Sue Stein, Director of the Milwaukee County Department 
on Aging, said at the same House Ways and Means Health Subcommittee 
hearing on December 4, 2001,

       Beneficiaries will still be expected to pay up to $4,800 
     out-of-pocket in addition to the $55 monthly premium for 
     United's coverage and the $54 monthly premium for Medicare 
     Part B. The excessive cost-sharing proposed by United raises 
     questions about the value of this so-called insurance. It is 
     now clear that many of the 16,000 seniors who have previously 
     relied on UnitedHealthcare to provide access to affordable 
     health care can no longer do so. It looks to us as though the 
     benefit changes for 2002 are designed to discourage 
     enrollment to beneficiaries who have health needs.

  The question arises why we would allow Medicare+Choice plans to 
effectively diminish the value of Medicare benefits in this manner. 
While the Secretary has the authority under current law to prohibit or 
reduce some of the new cost-sharing arrangements that plans are 
preparing to impose, the change proposed by this legislation makes it 
clear that Medicare+Choice plans cannot charge patients more for a 
service than the patient would face under the Medicare fee-for-service 
plan.
  In fact, the ability of Medicare+Choice plans to charge higher cost-
sharing for benefits or services than in fee-for-service results in 
further risk avoidance, or what is referred to as ``cherry picking,'' 
as plans seek to avoid or deny services to the chronically or severely 
ill. This can have an adverse consequence for the health of people with 
disabilities, limit their choices, and result in higher costs for the 
Medicare program. For all of these reasons, we should enact this 
provision in short order.

  While we are undertaking efforts to ensure that Medicare-Choice 
remains a viable option for Medicare beneficiaries, we must also ensure 
additional protections for beneficiaries.
  As Ms. Stein said in her testimony,

       These plans now call themselves new things, complete and 
     secure and healthy, but they are not complete or secure or 
     healthy. They are radically different. These Medicare+Choice 
     policies are not the same ones people bought when they took 
     advantage of what they perceived to be the value-added 
     benefits sold to them as Medicare+Choice. In fact, they are 
     left with Medicare minus protection, Medicare minus the 
     ability to buy a Medigap policy, Medicare minus the ability 
     to choose different insurance.

  In fact, according to a report by the Commonwealth Fund in April 
2001, ``31 percent of Medicare+Choice enrollees are in contracts where 
the basic plan has a copayment requirement for hospital admissions, 
compared with just 13 percent in 2000. Outpatient hospital copayments 
are being required of 45 percent of Medicare+Choice enrollees in 2001, 
compared with only 29 percent in 2000.'' This will only increase 
further in 2002.
  Therefore, to improve fundamental financial protections and health 
care options for our nation's Medicare seniors and disabled enrollees, 
I urge the swift passage of this legislation.
  The following organizations have expressed their support for this 
legislation: AFSCME Retiree Program, Alliance for Retired Americans, 
American Association of Homes and Service for the Aging, American 
Association for International Aging, American Federation of Teachers 
Program on Retirement and Retirees, American Society of Consultant 
Pharmacists, Association for Gerontology and Human Development in 
Historically Black Colleges and Universities, B'nai B'rith Center for 
Senior Housing and Services, California Health Advocates, Center for 
Medicare Advocacy, Congress of California Seniors, Eldercare America, 
Families USA, International Union--UAW, National Academy of Elder Law 
Attorneys, National Association of Area Agencies on Aging, National 
Association of Professional Geriatric Care Managers, National 
Association of Retired and Senior Volunteer Program Directors, National 
Association of Retired Federal Employees, National Association of 
Senior Companion Program Directors, National Association of State Units 
on Aging, National Committee to Preserve Social Security and Medicare, 
National Council on the Aging, National Renal Administrators 
Association, National Senior Citizens Law Center, and OWL--Voice for 
Midlife and Older Women.
  I request unanimous consent that a fact sheet and the text of the 
bill be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 1851

       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 Consumer 
     Protection Act of 2001''.

     SEC. 2. CONTINUOUS OPEN ENROLLMENT AND DISENROLLMENT.

       (a) In General.--Section 1851(e)(2) of the Social Security 
     Act (42 U.S.C. 1395w-21(e)(2)) is amended to read as follows:
       ``(2) Continuous open enrollment and disenrollment.--
     Subject to paragraph (5), a Medicare+Choice eligible 
     individual may change the election under subsection (a)(1) at 
     any time.''.
       (b) Conforming Amendments.--
       (1) Medicare+choice.--Section 1851(e) of such Act (42 
     U.S.C. 1395w-21(e)) is amended--
       (A) in paragraph (4)--
       (i) by striking ``Effective as of January 1, 2002, an'' and 
     inserting ``An'';
       (ii) by striking ``other than during an annual, coordinated 
     election period'';
       (iii) by inserting ``in a special election period for such 
     purpose'' after ``make a new election under this section''; 
     and
       (iv) by striking the second sentence; and
       (B) in paragraphs (5)(B) and (6)(A), by striking ``the 
     first sentence of''.
       (2) Permitting enrollment in medigap when m+c plans reduce 
     benefits or when provider leaves a m+c plan.--
       (A) In general.--Clause (ii) of section 1882(s)(3)(B) of 
     such Act (42 U.S.C. 1395ss(s)(3)(B)) is amended--
       (i) by inserting ``(I)'' after ``(ii)'';
       (ii) by striking ``under the first sentence of'' each place 
     it appears and inserting ``during a special election period 
     provided for under'';
       (iii) by inserting ``the circumstances described in 
     subclause (II) are present or'' before ``there are 
     circumstances''; and
       (iv) by adding at the end the following new subclause:
       ``(II) The circumstances described in this subclause are, 
     with respect to an individual enrolled in a Medicare+Choice 
     plan, a reduction in benefits (including an increase in cost-
     sharing) offered under the Medicare+Choice plan from the 
     previous year or a provider of services or physician

[[Page S13709]]

     who serves the individual no longer participating in the plan 
     (other than because of good cause relating to quality of care 
     under the plan).''.
       (B) Conforming amendment.--Clause (iii) of such section is 
     amended--
       (i) by inserting ``the circumstances described in clause 
     (ii)(II) are met or'' after ``policy described in subsection 
     (t), and''; and
       (ii) by striking ``under the first sentence of'' and 
     inserting ``during a special election period provided for 
     under''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 2002, and shall apply to 
     reductions in benefits and changes in provider participation 
     occurring on or after such date.

     SEC. 3. LIMITATION ON MEDICARE+CHOICE COST-SHARING.

       (a) In General.--Section 1852(a) (42 U.S.C. 1395w-22(a)) is 
     amended by adding at the end the following new paragraph:
       ``(6) Limitation on cost-sharing.--
       ``(A) In general.--Subject to subparagraph (B), in no case 
     shall the cost-sharing with respect to an item or service 
     under a Medicare+Choice plan exceed the cost-sharing 
     otherwise applicable under parts A and B to an individual who 
     is not enrolled in a Medicare+Choice plan under this part.
       ``(B) Permitting flat copayments.--Subparagraph (A) shall 
     not be construed as preventing the application of flat dollar 
     copayment amounts (in place of a percentage coinsurance), 
     such as a fixed copayment for a doctor's visit, so long as 
     such amounts are reasonable and appropriate and do not 
     adversely affect access to items and services (as determined 
     by the Secretary).''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply as of January 1, 2003.
                                  ____


      Medicare+Choice Consumer Protection Act of 2001--Fact Sheet

       Senators Jeff Bingaman (D-NM), Lincoln Chafee (R-RI), John 
     D. Rockefeller, IV (D-WV), Edward M. Kennedy (D-MA), Russ 
     Feingold (D-WI), Jon Corzine (D-NJ), Jack Reed (D-RI), 
     Hillary Rodham Clinton (D-NY), John Kerry (D-MA) and Herb 
     Kohl (D-WI) are preparing to introduce the ``Medicare+Choice 
     Consumer Protection Act of 2001.'' This legislation is a 
     companion bill to H.R. 3267, which was introduced by 
     Representative Pete Stark (D-CA).
       This legislation would improve consumer protections to 
     Medicare beneficiaries seeking to enroll in Medicare+Choice 
     plans by:
       Eliminating the Medicare+Choice lock-in schedule to go into 
     effect in January 2002;
       Extending the existing Medigap protections that apply to 
     people whose Medicare+Choice plan withdraws from the program 
     to anyone whose Medicare+Choice changes benefits or whose 
     doctor or hospital leaves the plan; and
       Preventing Medicare+Choice plans from charging higher cost-
     sharing for a service than Medicare charges in the fee-for-
     service program.


                          need for legislation

       Medicare+Choice Forthcoming Lock-In: Currently, Medicare 
     beneficiaries that are dissatisfied with their health plan 
     are allowed to enroll or disenroll from their health plans at 
     any time. As of January 2002, Medicare beneficiaries electing 
     the Medicare+Choice option will be required to ``lock in'' 
     with that plan for much longer periods. In fact, for 2002, 
     Medicare+Choice enrollees will only be allowed to switch 
     plans once during the first six months after enrollment. In 
     2003, the beneficiaries will only be able to switch once 
     during the first three months after enrollment.
       The legislation eliminates the upcoming lock-in to ensure 
     that Medicare beneficiaries continue to be allowed to leave a 
     health plan that is not meeting their needs. Medicare 
     beneficiaries, often our nation's most vulnerable citizens, 
     need to know that if they test an HMO and do not like the 
     system, arrangements, and rules that they will be able to 
     leave to choose a Medicare option that better suits their 
     specific needs. Both advocates and the managed care industry 
     support this provision.
       Medigap Protections When Medicare+Choice Plans Change 
     Benefits, Cost Sharing, or Provider Options: In addition, if 
     a Medicare+Choice plan withdrawals from a community or 
     Medicare entirely, beneficiaries can under current law move 
     into a select category of Medigap plans (A, B, C and F) 
     without any individual health underwriting. This provision 
     ensures that Medicare beneficiaries have affordable 
     supplemental Medicare options available to them when, through 
     no fault of their own, their Medicare+Choice plan 
     withdrawals.
       However, these protections for Medicare beneficiaries 
     currently do not apply with Medicare+Choice plans that make 
     significant changes, such as eliminating benefits, increasing 
     cost sharing, or changing available providers, within the HMO 
     but stop short of completely withdrawing from the Medicare 
     program. For example, some plans now cover only generic 
     prescriptions, in effect eliminating drug coverage for 
     beneficiaries whose prescriptions have no generic equivalent. 
     For those Medicare beneficiaries whose needs are no longer 
     met by the Medicare+Choice plan due to these changes, the 
     legislation extends the current Medigap protections for 
     beneficiaries when a plan terminates Medicare 
     participation to those in plans that have made important 
     changes to their benefits, cost sharing, or provider 
     options.
       Preventing Higher Cost Sharing in Medicare+Choice Than in 
     Fee-For-Service: Under current law, cost sharing per enrollee 
     (including premiums) for covered services cannot be more than 
     the actuarial value of the deductibles, coinsurance, and 
     copayments under traditional Medicare fee-for-service. 
     However, Medicare+Choice plans are increasingly charging 
     higher cost-sharing for individual services within the health 
     plan than is allowed in fee-for-service. Higher cost-sharing, 
     for example, is being required by some Medicare+Choice plans 
     for dialysis, hospitalization, and other services than in 
     traditional fee-for-service Medicare.
       In addition to creating an adverse consequence for the 
     health of Medicare beneficiaries with disabilities who have 
     certain illnesses, charging beneficiaries higher costs for 
     certain services results in what is referred to as ``cherry 
     picking,'' as some plans seek to avoid or deny services to 
     the chronically or severely ill. Again, this can have adverse 
     health effects for certain beneficiaries, limit their 
     choices, and resulting in higher costs for the Medicare 
     payment through ``risk selection.'' Consequently, this 
     legislation would close this loophole and prohibit 
     Medicare+Choice plans from imposing higher cost sharing for 
     certain services than is allowed in Medicare fee-for-service.


                        Supporting Organizations

       AFSCME Retiree Program.
       Alliance for Retired Americans.
       American Association of Homes and Service for the Aging.
       American Association for International Aging.
       American Federation of Teachers Program on Retirement and 
     Retirees.
       American Society of Consultant Pharmacists.
       Association for Gerontology and Human Development in 
     Historically Black Colleges and Universities.
       B'nai B'rith Center for Senior Housing and Services.
       California Health Advocates.
       Center for Medicare Advocacy.
       Congress of California Seniors.
       Eldercare America.
       Families USA.
       International Union, UAW.
       National Academy of Elder Law Attorneys.
       National Association of Area Agencies on Aging.
       National Association of Professional Geriatric Care 
     Managers.
       National Association of Retired and Senior Volunteer 
     Program Directors.
       National Association of Retired Federal Employees.
       National Association of Senior Companion Program Directors.
       National Association of State Units on Aging.
       National Committee to Preserve Social Security and 
     Medicare.
       National Council on the Aging.
       National Renal Administrators Association.
       National Senior Citizens Law Center.
       OWL, Voice for Midlife and Older Women.
                                 ______