[Congressional Record Volume 153, Number 121 (Thursday, July 26, 2007)]
[Senate]
[Pages S10153-S10155]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KOHL (for himself, Mr. Dorgan, and Mr. Wyden):
  S. 1883. A bill to amend title XVIII of the Social Security Act to 
provide for standardized marketing requirements under the Medicare 
Advantage program and the Medicare prescription drug program and to 
provide for State certification prior to waiver of licensure 
requirements under the Medicare prescription drug program, and for 
other purposes; to the Committee on Finance.
  Mr. KOHL. Mr. President, I rise today to introduce the Accountability 
and Transparency in Medicare Marketing Act, on behalf of myself and 
Senator Dorgan and Wyden. This legislation aims to regulate the 
marketing standards and sales tactics of Medicare Advantage and 
Medicare prescription drug plans, now the fastest growing segment of 
Medicare and a prime target for fraud, misrepresentation, and deceptive 
sales practices.
  As chairman of the Special Committee on Aging, I recently held a 
hearing entitled, ``Medicare Advantage Marketing and Sales: Who Has the 
Advantage?'' Our hearing uncovered that a large majority of State 
insurance departments have received, and continue to receive, an 
unprecedented number of complaints about inappropriate or confusing 
marketing practices that have led Medicare beneficiaries to enroll in 
Medicare Advantage plans without adequately understanding the 
consequences of their decisions.
  My legislation will facilitate the creation of uniform marketing 
standards that will be adopted and enforced by individual states. Based 
on current law, CMS has exclusive authority to investigate and 
discipline the marketing and selling of Medicare advantage products, 
while States have only been permitted to examine and enforce violations 
against individual insurance agents. This unusual arrangement, which 
some might call a pre-emption of authority, has left a sizable 
enforcement gap that has exacerbated the problems found by the 
committee.
  This legislation will close that gap, giving States the ability to 
standardize marketing and sales regulations, as well as regulate both 
agents and companies in the marketing and sales of

[[Page S10154]]

Medicare Advantage and prescription drug plans. Ultimately, State 
insurance commissioners will have the ability to work in conjunction 
with CMS in order to provide the most comprehensive protection possible 
for Medicare beneficiaries.
  Senior citizens deserve to have access to the health care plan that 
best serves their needs without having to worry about being purposely 
mislead and deceived. I believe we must repair this disconnect in 
oversight and ensure the protection of American seniors, and I hope my 
colleagues will join in my effort to do so.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the text of the bill was ordered to be 
placed in the Record, as follows:

                                S. 1883

       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 ``Accountability and 
     Transparency in Medicare Marketing Act of 2007''.

     SEC. 2. STANDARDIZED MARKETING REQUIREMENTS UNDER THE 
                   MEDICARE ADVANTAGE AND MEDICARE PRESCRIPTION 
                   DRUG PROGRAMS.

       (a) Medicare Advantage Program.--
       (1) In general.--Section 1856 of the Social Security Act 
     (42 U.S.C. 1395w-26) is amended--
       (A) in subsection (b)(1), by inserting ``or subsection 
     (c)'' after ``subsection (a)''; and
       (B) by adding at the end the following new subsection:
       ``(c) Standardized Marketing Requirements.--
       ``(1) Development by the naic.--
       ``(A) Requirements.--The Secretary shall request the 
     National Association of Insurance Commissioners (in this 
     subsection referred to as the `NAIC') to--
       ``(i) develop standardized marketing requirements for 
     Medicare Advantage organizations with respect to Medicare 
     Advantage plans and PDP sponsors with respect to prescription 
     drug plans under part D; and
       ``(ii) submit a report containing such requirements to the 
     Secretary by not later than the date that is 9 months after 
     the date of enactment of this subsection.
       ``(B) Prohibited activities.--Such requirements shall 
     prohibit the following:
       ``(i) Cross-selling of non-Medicare products or services 
     with products or services offered by a Medicare Advantage 
     plan or a prescription drug plan under part D.
       ``(ii) Up-selling from prescription drug plans under part D 
     to Medicare Advantage plans.
       ``(iii) Telemarketing (including cold calling) conducted by 
     an organization with respect to a Medicare Advantage plan or 
     a PDP sponsor with respect to a prescription drug plan under 
     part D (or by an agent of such an organization or sponsor).
       ``(iv) A Medicare Advantage organization or a PDP sponsor 
     providing cash or other monetary rebates as an inducement for 
     enrollment or otherwise.
       ``(C) Election form.--Such requirements may prohibit a 
     Medicare Advantage organization or a PDP sponsor (or an agent 
     of such an organization or sponsor) from completing any 
     portion of any election form used to carry out elections 
     under section 1851 or 1860D-1 on behalf of any individual.
       ``(D) Agent and broker commissions.--Such requirements 
     shall establish standards--
       ``(i) for fair and appropriate commissions for agents and 
     brokers of Medicare Advantage organizations and PDP sponsors, 
     including a prohibition on extra bonuses or incentives; and
       ``(ii) for the disclosure of such commissions.
       ``(E) Certain conduct of agents.--Such requirements shall 
     address the conduct of agents engaged in on-site promotion at 
     a facility of an organization with which the Medicare 
     Advantage organization or PDP sponsor has a cobranding 
     relationship.
       ``(F) Other standards.--Such requirements may establish 
     such other standards relating to marketing under Medicare 
     Advantage plans and prescription drug plans under part D as 
     the NAIC determines appropriate.
       ``(2) Implementation of requirements.--
       ``(A) Adoption of naic developed requirements.--If the NAIC 
     develops standardized marketing requirements and submits the 
     report pursuant to paragraph (1), the Secretary shall 
     promulgate regulations for the adoption of such requirements. 
     The Secretary shall ensure that such regulations take effect 
     not later than the date that is 10 months after the date of 
     enactment of this subsection.
       ``(B) Requirements if naic does not submit report.--If the 
     NAIC does not develop standardized marketing requirements and 
     submit the report pursuant to paragraph (1), the Secretary 
     shall promulgate regulations for standardized marketing 
     requirements for Medicare Advantage organizations with 
     respect to Medicare Advantage plans and PDP sponsors with 
     respect to prescription drug plans under part D. Such 
     regulations shall prohibit the conduct described in paragraph 
     (1)(B), may prohibit the conduct described in paragraph 
     (1)(C), shall establish the standards described in paragraph 
     (1)(D), shall address the conduct described in paragraph 
     (1)(E), and may establish such other standards relating to 
     marketing under Medicare Advantage plans and prescription 
     drug plans as the Secretary determines appropriate. The 
     Secretary shall ensure that such regulations take effect not 
     later than the date that is 10 months after the date of 
     enactment of this subsection.
       ``(C) Consultation.--In establishing requirements under 
     this subsection, the NAIC or Secretary (as the case may be) 
     shall consult with a working group composed of 
     representatives of Medicare Advantage organizations and PDP 
     sponsors, consumer groups, and other qualified individuals. 
     Such representatives shall be selected in a manner so as to 
     insure balanced representation among the interested groups.
       ``(3) State reporting of violations of standardized 
     marketing requirements.--The Secretary shall request that 
     States report any violations of the standardized marketing 
     requirements under the regulations under subparagraph (A) or 
     (B) of paragraph (2) to national and regional offices of the 
     Centers for Medicare & Medicaid Services.
       ``(4) Report.--The Secretary shall submit an annual report 
     to Congress on the enforcement of the standardized marketing 
     requirements under the regulations under subparagraph (A) or 
     (B) of paragraph (2), together with such recommendations as 
     the Secretary determines appropriate. Such report shall 
     include--
       ``(A) a list of any alleged violations of such requirements 
     reported to the Secretary by a State, a Medicare Advantage 
     organization, or a PDP sponsor; and
       ``(B) the disposition of such reported violations.''.
       (2) State authority to enforce standardized marketing 
     requirements.--
       (A) In general.--Section 1856(b)(3) of the Social Security 
     Act (42 U.S.C. 1395w-26(b)(3)) is amended--
       (i) by striking ``or State'' and inserting ``, State''; and
       (ii) by inserting ``, or State laws or regulations enacting 
     the standardized marketing requirements under subsection 
     (c)'' after ``plan solvency''.
       (B) No preemption of state sanctions.--Nothing in title 
     XVIII of the Social Security Act or the provisions of, or 
     amendments made by, this Act, shall be construed to prohibit 
     a State from imposing sanctions against Medicare Advantage 
     organizations, PDP sponsors, or agents or brokers of such 
     organizations or sponsors for violations of the standardized 
     marketing requirements under subsection (c) of section 1856 
     of the Social Security Act (as added by paragraph (1)) as 
     enacted by that State.
       (3) Conforming amendment.--Section 1851(h)(4) of the Social 
     Security Act (42 U.S.C. 1395w-21(h)(4)) is amended by adding 
     at the end the following flush sentence:
     ``Beginning on the effective date of the implementation of 
     the regulations under subparagraph (A) or (B) of section 
     1856(c)(2), each Medicare Advantage organization with respect 
     to a Medicare Advantage plan offered by the organization (and 
     agents of such organization) shall comply with the 
     standardized marketing requirements under section 1856(c).''.
       (b) Medicare Prescription Drug Program.--Section 1860D-4 of 
     the Social Security Act (42 U.S.C. 1395w-104) is amended by 
     adding at the end the following new subsection:
       ``(l) Standardized Marketing Requirements.--A PDP sponsor 
     with respect to a prescription drug plan offered by the 
     sponsor (and agents of such sponsor) shall comply with the 
     standardized marketing requirements under section 1856(c).''.

     SEC. 3. STATE CERTIFICATION PRIOR TO WAIVER OF LICENSURE 
                   REQUIREMENTS UNDER MEDICARE PRESCRIPTION DRUG 
                   PROGRAM.

       (a) In General.--Section 1860D-12(c) of the Social Security 
     Act (42 U.S.C. 1395w-112(c)) is amended--
       (1) in paragraph (1)(A), by striking ``In the case'' and 
     inserting ``Subject to paragraph (5), in the case''; and
       (2) by adding at the end the following new paragraph:
       ``(5) State certification required.--
       ``(A) In general.--The Secretary may only grant a waiver 
     under paragraph (1)(A) if the Secretary has received a 
     certification from the State insurance commissioner that the 
     prescription drug plan has a substantially complete 
     application pending in the State.
       ``(B) Revocation of waiver upon finding of fraud and 
     abuse.--The Secretary shall revoke a waiver granted under 
     paragraph (1)(A) if the State insurance commissioner submits 
     a certification to the Secretary that the recipient of such a 
     waiver--
       ``(i) has committed fraud or abuse with respect to such 
     waiver;
       ``(ii) has failed to make a good faith effort to satisfy 
     State licensing requirements; or
       ``(iii) was determined ineligible for licensure by the 
     State.''.
       (b) Effective Date.--The amendments made by paragraph (1) 
     shall apply with respect to plan years beginning on or after 
     January 1, 2008.

     SEC. 4. NAIC RECOMMENDATIONS ON THE ESTABLISHMENT OF 
                   STANDARDIZED BENEFIT PACKAGES FOR MEDICARE 
                   ADVANTAGE PLANS AND PRESCRIPTION DRUG PLANS.

       Not later than 30 days after the date of enactment of this 
     Act, the Secretary of Health

[[Page S10155]]

     and Human Services shall request the National Association of 
     Insurance Commissioners to establish a committee to study and 
     make recommendations to the Secretary and Congress on--
       (1) the establishment of standardized benefit packages for 
     Medicare Advantage plans under part C of title XVIII of the 
     Social Security Act and for prescription drug plans under 
     part D of such Act; and
       (2) the regulation of such plans.
                                 ______