[Congressional Record Volume 155, Number 122 (Thursday, August 6, 2009)]
[Senate]
[Pages S9029-S9038]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ROCKEFELLER (for himself, Mr. Akaka, and Mr. Brown):
  S. 1634. A bill to amend titles XVIII and XIX of the Social Security 
Act to protect and improve the benefits provided to dual eligible 
individuals under the Medicare and Medicaid programs; to the Committee 
on Finance.
  Mr. ROCKEFELLER. Mr. President, I rise today with my colleagues, 
Senator Akaka and Senator Brown, to introduce the Medicare Prescription 
Drug Coverage Improvement Act, legislation that makes long overdue 
improvements to the Medicare prescription drug program, particularly 
for Medicare beneficiaries who are simultaneously enrolled in Medicaid. 
Know as ``dual eligibles,'' these individuals are among our nation's 
most vulnerable populations--and they have been overlooked for far too 
long.
  Approximately 8.8 million Americans are simultaneously enrolled in 
Medicare and Medicaid, and they are among the sickest and poorest 
individuals covered by either program. Most dual eligibles are very 
low-income, in poor health, and have substantial health care needs. 
Seventy-one percent of dual eligibles have annual incomes below 
$10,000. Over half of all elderly dual eligibles are limited in 
activities of daily living and, in comparison to other Medicare 
beneficiaries, are three times more likely to be disabled. Dual 
eligibles also have higher rates of heart disease, pulmonary disease, 
diabetes, and Alzheimer's disease than the general Medicare population.
  After passage of the Medicare prescription drug law, Members of 
Congress and health care advocates alike tried for more than a year to 
work with the Bush Administration to prevent prescription drug coverage 
barriers for dual eligibles and other low-income Medicare 
beneficiaries. I introduced the Medicare Dual Eligible Prescription 
Drug Coverage Act of 2005, S. 566. and the Requiring Emergency 
Pharmaceutical Access for Individual Relief, REPAIR, Act of 2006, S. 
2183, to prevent disruptions in coverage for vulnerable seniors and 
individuals with disabilities.
  Unfortunately, effective fail-safe mechanisms were not put into place 
by the previous Administration to address the transition of the dual 
eligibles to Medicare prescription drug coverage. Consequently, 
millions of elderly and disabled Medicare recipients continue to 
experience significant barriers to care.
  Health care problems persist for the dually eligible largely because 
of poor coordination between Medicare and Medicaid--which have two 
different sets of providers, two different sets of benefits, and two 
different sets of enrollment policies. The legislation we

[[Page S9030]]

are introducing today will go a long way to provide dual eligibles with 
the right care, in the right setting, and at the right time.
  Additionally, the Medicare Prescription Drug Coverage Improvement Act 
will provide more affordable and comprehensive prescription drug 
coverage for all Medicare beneficiaries.
  First, this bill will create a new Federal Coordinated Health Care 
Office within the Centers for Medicare and Medicaid Services, CMS. The 
purpose of this new office will be to provide a much more integrated 
model of care for dual eligibles by coordinating their Medicare and 
Medicaid benefits.
  Second, this bill contains two provisions to help make prescription 
drugs more affordable and accessible for all Medicare beneficiaries--it 
allows the Secretary of Health and Human Services to negotiate directly 
with pharmaceutical companies to lower prescription drug prices and it 
creates a Medicare-operated prescription drug plan.
  The Secretary would be required to implement two or more of the 
following strategies on an annual basis to reduce the cost of 
prescription drugs covered by Medicare: direct price negotiation with 
pharmaceutical manufacturers, additional rebate agreements for Medicare 
prescription drugs that are consistent with the rebate agreements 
provided to states for Medicaid, comparative clinical effectiveness 
data, or prescription drug rates negotiated under the Federal Supply 
Schedule.
  A Medicare-operated prescription drug plan would be created by the 
Secretary of HHS. This plan would be a stable and affordable option 
available to all Medicare beneficiaries. This plan would create a 
robust prescription drug formulary based on patient safety, efficacy 
and value. The formulary incentive process would be transparent and 
uniform. An advisory committee would be created to review petitions for 
drug inclusion and recommend formulary changes. This Medicare-operated 
plan will create fair-market competition and lead to less costly drug 
choices for Medicare recipients.
  Third, this bill contains significant new requirements for Medicare 
Advantage Special Needs Plans. These plans serve extremely vulnerable 
populations, including dual eligibles; yet, they have very few 
standards that they are required to abide by. The Medicare Prescription 
Drug Improvement Act will require special needs plans to be accredited 
by the National Committee for Quality Assurance. Additionally, our 
legislation requires special needs plans to provide more robust 
prescription drug coverage, meet uniform standards for data collection 
and reporting, and offer better care coordination.
  Finally, this bill will implement a number of technical fixes to 
facilitate enrollment in the Medicare prescription drug benefit for 
those who qualify. State and Federal officials will be required to 
clearly identify dual eligibles in all databases and electronically 
file eligibility information, so that these beneficiaries will not 
continue to fall through the cracks. Pharmacies will use a facilitated 
point-of-sale enrollment process and automatically enroll certain dual 
eligible individuals in the Medicare-operated prescription drug plan. 
New limits on cost-sharing and resource requirements for low-income 
beneficiaries will also be put into place. Prescription drug cost-
sharing for dual eligibles who are using home and community-based 
services, instead of institutionalized care, will be eliminated.
  We are in the midst of discussing sweeping changes to our health care 
system. In addition to provisions to help the uninsured, health care 
reform must also include provisions to improve the coverage that people 
have today. This is especially true for seniors and individuals with 
disabilities. The Medicare prescription drug program is extremely 
difficult to navigate and many enrollees are still denied access to the 
prescription drugs that they need. This legislation will make the 
Medicare prescription drug program much more manageable for seniors and 
individuals with disabilities, particularly those dually eligible for 
Medicare and Medicaid.
  The time for action is now, and I urge my colleagues to join us in 
support of this important legislation.
  Mr. President, 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 
printed in the Record, as follows:

                                S. 1634

       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 
     Prescription Drug Coverage Improvement Act''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.

              TITLE I--MEDICARE AND MEDICAID IMPROVEMENTS

Sec. 101. Providing Federal coverage and payment coordination for low-
              income Medicare beneficiaries.
Sec. 102. Creating a Medicare operated prescription drug plan option.
Sec. 103. Accreditation requirement for all specialized Medicare 
              Advantage plans and revisions relating to specialized 
              Medicare Advantage plans for special needs individuals.
Sec. 104. Providing better care coordination for low-income 
              beneficiaries in Medicare part D.
Sec. 105. Improving transition of new dual eligible individuals to 
              medicare prescription drug coverage and presumptive 
              eligibility for low-income subsidies.
Sec. 106. Required information on transition from skilled nursing 
              facilities and nursing facilities to part D plans.
Sec. 107. Streamlined pharmacy compliance packaging.
Sec. 108. Lowering covered part D drug prices on behalf of Medicare 
              beneficiaries.
Sec. 109. Correction of flaws in determination of phased-down State 
              contribution for Federal assumption of prescription drug 
              costs for dually eligible individuals.
Sec. 110. No impact on eligibility for benefits under other programs.
Sec. 111. Quality indicators for dual eligible individuals.

        TITLE II--ADDITIONAL MEDICARE AND MEDICAID IMPROVEMENTS

Subtitle A--Improving the Financial Assistance Available to Low-Income 
                         Medicare Beneficiaries

Sec. 201. Improving assets tests for Medicare Savings Program and low-
              income subsidy program.
Sec. 202. Eliminating barriers to enrollment.
Sec. 203. Elimination of part D cost-sharing for certain non-
              Institutionalized full-benefit dual eligible individuals.
Sec. 204. Exemption of balance in any pension or retirement plan from 
              resources for determination of eligibility for low-income 
              subsidy.
Sec. 205. Cost-sharing protections for low-income subsidy-eligible 
              individuals.

                     Subtitle B--Other Improvements

Sec. 211. Enrollment improvements under Medicare parts C and D.
Sec. 212. Medicare plan complaint system.
Sec. 213. Uniform exceptions and appeals process.
Sec. 214. Prohibition on conditioning Medicaid eligibility for 
              individuals enrolled in certain creditable prescription 
              drug coverage on enrollment in the Medicare part D drug 
              program.
Sec. 215. Office of the Inspector General annual report on part D 
              formularies' inclusion of drugs commonly used by dual 
              eligibles.
Sec. 216. HHS ongoing study and annual reports on coverage for dual 
              eligibles.
Sec. 217. Authority to obtain information.

              TITLE I--MEDICARE AND MEDICAID IMPROVEMENTS

     SEC. 101. PROVIDING FEDERAL COVERAGE AND PAYMENT COORDINATION 
                   FOR LOW-INCOME MEDICARE BENEFICIARIES.

       (a) Establishment of Federal Coordinated Health Care 
     Office.--
       (1) Establishment.--
       (A) In general.--Not later than October 1, 2009, the 
     Secretary of Health and Human Services (in this section 
     referred to as the ``Secretary'') shall establish a Federal 
     Coordinated Health Care Office.
       (B) Establishment and reporting to cms administrator.--The 
     Federal Coordinated Health Care Office shall--
       (i) be established within the Centers for Medicare & 
     Medicaid Services; and
       (ii) report directly to the Administrator of the Centers 
     for Medicare & Medicaid Services.
       (2) Purpose.--The purpose of the Federal Coordinated Health 
     Care Office is to bring together officials of the Medicare 
     and Medicaid programs at the Centers for Medicare & Medicaid 
     Services in order to--
       (A) more effectively integrate benefits under the Medicare 
     program under title XVIII of the Social Security Act and the 
     Medicaid program under title XIX of such Act; and
       (B) improve the coordination between the Federal Government 
     and States for individuals eligible for benefits under both 
     such

[[Page S9031]]

     programs in order to ensure that such individuals get full 
     access to the items and services to which they are entitled 
     under titles XVIII and XIX of the Social Security Act.
       (3) Goals.--The goals of the Federal Coordinated Health 
     Care Office are as follows:
       (A) Providing dual eligible individuals full access to the 
     benefits to which such individuals are entitled under the 
     Medicare and Medicaid programs.
       (B) Simplifying the processes for dual eligible individuals 
     to access the items and services they are entitled to under 
     the Medicare and Medicaid programs
       (C) Improving the quality of health care and long-term 
     services for dual eligible individuals.
       (D) Increasing beneficiary understanding of and 
     satisfaction with coverage under the Medicare and Medicaid 
     programs.
       (E) Eliminating regulatory conflicts between rules under 
     the Medicare and Medicaid programs.
       (F) Improving care continuity and ensuring safe and 
     effective care transitions.
       (G) Eliminating cost-shifting between the Medicare and 
     Medicaid program and among related health care providers.
       (H) Improving the quality of performance of providers of 
     services and suppliers under the Medicare and Medicaid 
     programs.
       (4) Specific responsibilities.--The specific 
     responsibilities of the Federal Coordinated Health Care 
     Office are as follows:
       (A) Providing States, specialized MA plans for special 
     needs individuals (as defined in section 1859(b)(6) of the 
     Social Security Act (42 U.S.C. 1395w-28(b)(6)), physicians 
     and other relevant entities or individuals with the education 
     and tools necessary for developing programs that align 
     benefits under the Medicare and Medicaid programs for dual 
     eligible individuals.
       (B) Working with the Director of the Congressional Budget 
     Office and the Director of the Office of Management and 
     Budget, and in consultation with the Medicare Payment 
     Advisory Commission and the Medicaid and CHIP Payment and 
     Access Commission, to, not later than January 1, 2011, 
     establish dynamic scoring for benefits for dual eligible 
     individuals to account for total spending and savings for 
     comparable risk groups under the Medicare program.
       (C) Supporting State efforts to coordinate and align acute 
     care and long-term care services for dual eligible 
     individuals with other items and services furnished under the 
     Medicare program.
       (D) Providing support for coordination of contracting and 
     oversight by States and the Centers for Medicare & Medicaid 
     Services with respect to the integration of the Medicare and 
     Medicaid programs in a manner that is supportive of the goals 
     described in paragraph (3).
       (5) Report.--The Secretary shall, as part of the budget 
     transmitted under section 1105(a) of title 31, United States 
     Code, submit to Congress an annual report containing 
     recommendations for legislation that would improve care 
     coordination and benefits for dual eligible individuals.
       (b) Addition of Medicaid Representatives to Medicare 
     Payment Advisory Commission and Consultation With Medicaid 
     and CHIP Payment and Access Commission.--
       (1) Addition of medicaid representative to medicare payment 
     advisory commission.--Section 1805(c)(2)(B) of the Social 
     Security Act (42 U.S.C. 1395b-6(c)(2)(B)) is amended by 
     adding at the end the following sentence: ``Such membership 
     shall also include at least 2 individuals who are nationally 
     recognized for their expertise in financing, benefits, and 
     provider payment policies under the program under title 
     XIX.''.
       (2) Consultation with medicaid and chip payment and access 
     commission.--Section 1805(b) of the Social Security Act (42 
     U.S.C. 1395b-6(b)) is amended by adding at the end the 
     following new paragraph:
       ``(9) Consultation with medicaid and chip payment and 
     access commission.--In carrying out the duties of the 
     Commission under this subsection, the Commission shall 
     consult with the Medicaid and CHIP Payment and Access 
     Commission established under section 506 of the Children's 
     Health Insurance Program Reauthorization Act of 2009 (Public 
     Law 111-3) on an ongoing basis.''.
       (c) MACPAC Funding and Technical Amendments.--
       (1) Funding.--Section 1900(f) of the Social Security Act 
     (42 U.S.C. 1396(f)) is amended--
       (A) in the subsection heading, by striking ``Authorization 
     of Appropriations'' and inserting ``Funding'';
       (B) in paragraph (1), by inserting ``(other than for fiscal 
     year 2009)'' before ``in the same manner''; and
       (C) by striking paragraph (2) and inserting the following:
       ``(2) Appropriation.--Out of any funds in the Treasury not 
     otherwise appropriated, there is appropriated to MACPAC 
     $11,403,000 for fiscal year 2009 to carry out the provisions 
     of this section.
       ``(3) Authorization.--In addition to amounts made available 
     under paragraph (2), there are authorized to be appropriated 
     for fiscal years beginning with fiscal year 2010, such sums 
     as may be necessary to carry out the provisions of this 
     section.
       ``(4) Availability.--Amounts made available under 
     paragraphs (2) and (3) to carry out the provisions of this 
     section shall remain available until expended.''.
       (2) Technical amendments.--Section 1900(b) of such Act (42 
     U.S.C. 1396) is amended--
       (A) in paragraph (1)(D), by striking ``June 1'' and 
     inserting ``June 15''; and
       (B) by adding at the end the following:
       ``(10) Consultation with medpac.--
       ``(A) In general.--MACPAC shall regularly consult with the 
     Medicare Payment Advisory Commission (in this paragraph 
     referred to as `MedPAC') established under section 1805 in 
     carrying out its duties under this section.
       ``(B) Data sharing.--MACPAC and MedPAC shall have 
     unrestricted access to all deliberations, records, and 
     nonproprietary data of the other such entity, respectively, 
     immediately upon the request of the either such entity.''.
       (d) Rule of Construction.--Nothing in this section--
       (1) requires mandatory integrated care under the Medicare 
     or Medicaid programs under titles XVIII and XIX, 
     respectively, of the Social Security Act;
       (2) promotes enrollment in specialized MA plans for special 
     needs individuals (as defined in section 1859(b)(6) of the 
     Social Security Act (42 U.S.C. 1395w-28(b)(6));
       (3) promotes the development of Medicaid managed care for 
     dual eligible individuals; or
       (4) prevents dual eligible individuals from electing to 
     remain in the original Medicare fee-for-service option, or 
     the right to make such election being protected.

     SEC. 102. CREATING A MEDICARE OPERATED PRESCRIPTION DRUG PLAN 
                   OPTION.

       (a) Medicare Operated Prescription Drug Plan Option.--
       (1) In general.--Subpart 2 of part D of the Social Security 
     Act is amended by inserting after section 1860D-11 (42 U.S.C. 
     1395w-111) the following new section:


           ``medicare operated prescription drug plan option

       ``Sec. 1860D-11A.  (a) In General.--Notwithstanding any 
     other provision of this part, for each year (beginning with 
     2011), in addition to any plans offered under section 1860D-
     11, the Secretary shall offer one or more Medicare operated 
     prescription drug plans (as defined in subsection (b)) with a 
     service area that consists of the entire United States and 
     shall enter into negotiations in accordance with section 
     1860D-11A(i) with pharmaceutical manufacturers to reduce the 
     purchase cost of covered part D drugs for eligible part D 
     individuals who enroll in such a plan.
       ``(b) Medicare Operated Prescription Drug Plan Defined.--
     For purposes of this part, the term `Medicare operated 
     prescription drug plan' means a prescription drug plan that 
     offers qualified prescription drug coverage and access to 
     negotiated prices described in section 1860D-2(a)(1)(A).
       ``(c) Monthly Beneficiary Premium.--
       ``(1) Qualified prescription drug coverage.--The monthly 
     beneficiary premium for qualified prescription drug coverage 
     and access to negotiated prices described in section 1860D-
     2(a)(1)(A) to be charged under a Medicare operated 
     prescription drug plan shall be uniform nationally. Such 
     premium for months in 2010 and each succeeding year shall be 
     equal to the product of--
       ``(A) the beneficiary premium percentage (as specified in 
     section 1860D-13(a)(3)); and
       ``(B) the average monthly per capita actuarial cost of 
     offering the Medicare operated prescription drug plan for the 
     year involved, including administrative expenses.
       ``(2) Premium subsidy for applicable subsidy eligible 
     individuals.--
       ``(A) Full subsidy eligible individuals.--In the case of an 
     applicable subsidy eligible individual described in paragraph 
     (4)(A), the individual is entitled under this section to an 
     income-related premium subsidy equal to 100 percent of the 
     monthly beneficiary premium of the Medicare operated 
     prescription drug plan.
       ``(B) Other subsidy eligible individuals.--In the case of 
     an applicable subsidy eligible individual described in 
     paragraph (4)(B), the individual is entitled under this 
     section to an income-related premium subsidy determined on a 
     linear sliding scale as follows:
       ``(i) One hundred percent of the amount described in 
     subparagraph (A) for individuals with incomes at or below 135 
     percent of such level.
       ``(ii) Seventy-five percent of such amount for individuals 
     with incomes above 135 percent of such level and at or below 
     140 percent of such level.
       ``(iii) Fifty percent of such amount for individuals with 
     incomes above 140 percent of such level and at or below 145 
     percent of such level.
       ``(iv) Twenty-five percent of such amount for individuals 
     with incomes above 145 percent of such level and below 150 
     percent of such level.
       ``(v) Zero percent of such amount for individuals with 
     incomes at 150 percent of such level.
       ``(3) Cost-sharing for applicable subsidy eligible 
     individuals.--
       ``(A) Full-subsidy eligible individuals.--In the case of an 
     applicable subsidy eligible individual described in paragraph 
     (4)(A), the provisions of section 1860D-14(a)(1) shall apply, 
     except the premium subsidy under paragraph (2)(A) shall be 
     substituted for the premium subsidy under subparagraph (A) of 
     such section 1860D-14(a)(1); and
       ``(B) Other subsidy eligible individuals.--In the case of 
     an applicable subsidy eligible individual described in 
     paragraph (4)(B), the provisions of section 1860D-14(a)(2) 
     shall apply, except the premium subsidy under paragraph 
     (2)(B) shall be substituted

[[Page S9032]]

     for the premium subsidy under subparagraph (A) of such 
     section 1860D-14(a)(2).
       ``(4) Definition of applicable subsidy eligible 
     individuals.--For purposes of paragraphs (2) and (3), the 
     term `applicable subsidy eligible individual' means the 
     following:
       ``(A) Full-subsidy eligible individuals.--
       ``(i) Individuals with income below 135 percent of poverty 
     line.--Any individual who--

       ``(I) is enrolled in a Medicare operated prescription drug 
     plan;
       ``(II) is determined to have income that is below 135 
     percent of the poverty line applicable to a family of the 
     size involved; and
       ``(III) meets the resources requirement described in 
     section 1860D-14(a)(3)(E), as amended by section 201 of the 
     Medicare Prescription Drug Coverage Improvement Act.

       ``(ii) Certain other individuals.--Any individual who is 
     enrolled in a Medicare operated prescription drug plan who--

       ``(I) is a full-benefit dual eligible individual (as 
     defined in section 1935(c)(6));
       ``(II) receives benefits under the supplemental security 
     income program under title XVI; or
       ``(III) is eligible for medical assistance under clause 
     (i), (iii), or (iv) of section 1902(a)(10)(E).

       ``(B) Other subsidy eligible individuals.--Any individual 
     who--
       ``(i) is not described in paragraph (1);
       ``(ii) is enrolled in a Medicare operated prescription drug 
     plan;
       ``(iii) is determined to have income that is below 150 
     percent of the poverty line applicable to a family of the 
     size involved; and
       ``(iv) meets the resources requirement described in section 
     1860D-14(a)(3)(E), as amended by section 201 of the Medicare 
     Prescription Drug Coverage Improvement Act.
       ``(d) Use of a Formulary and Formulary Incentives.--
       ``(1) Use of a formulary.--
       ``(A) In general.--With respect to the operation of a 
     Medicare operated prescription drug plan, the Secretary shall 
     establish and apply a formulary (and may include formulary 
     incentives described in paragraph (5)(C)(ii)) in accordance 
     with this subsection in order to--
       ``(i) increase patient safety;
       ``(ii) increase appropriate use and reduce inappropriate 
     use of drugs; and
       ``(iii) reward value.
       ``(B) Default initial formulary.--Until such time as the 
     Secretary establishes and applies the initial formulary under 
     paragraph (5), a Medicare operated prescription drug plan 
     shall be required to include all drugs approved for safety 
     and effectiveness as a prescription drug under the Federal 
     Food, Drug, and Cosmetic Act that are covered part D drugs 
     (and may include formulary incentives described in paragraph 
     (5)(C)(ii)).
       ``(2) Requirements for formularies.--The Secretary shall 
     establish a formulary that meets the following requirements:
       ``(A) Except as provided in subparagraph (B), the formulary 
     includes the covered outpatient drugs of any manufacturer 
     which has entered into and complies with an agreement with 
     the Secretary under this section.
       ``(B) A covered outpatient drug may be excluded with 
     respect to the treatment of a specific disease or condition 
     for an identified population (if any) only if, based on the 
     drug's labeling (or, in the case of a drug the prescribed use 
     of which is not approved under the Federal Food, Drug, and 
     Cosmetic Act but is a medically accepted indication (as 
     defined in section 1860D-2(e)(4)), the excluded drug does not 
     have a significant, clinically meaningful therapeutic 
     advantage in terms of safety, effectiveness, or clinical 
     outcome of such treatment for such population over other 
     drugs included in the formulary and there is a written 
     explanation (available to the public) of the basis for the 
     exclusion.
       ``(C) The Secretary permits coverage of a drug excluded 
     from the formulary pursuant to a prior authorization program 
     that is consistent with paragraph (3).
       ``(D) The formulary meets such other requirements as the 
     Secretary may impose in order to achieve program savings 
     consistent with protecting the health of program 
     beneficiaries.
     A prior authorization program established under paragraph (3) 
     is not a formulary subject to the requirements of this 
     paragraph.
       ``(3) Requirements of prior authorization programs.--The 
     Secretary may require, with respect to drugs dispensed on or 
     after July 1, 1991, the approval of the drug before its 
     dispensing for any medically accepted indication (as defined 
     in section 1860D-2(e)(4)) only if the system providing for 
     such approval--
       ``(A) provides response by telephone or other 
     telecommunication device within 24 hours of a request for 
     prior authorization; and
       ``(B) provides for the dispensing of at least a 72-hour 
     supply of a covered outpatient prescription drug in an 
     emergency situation (as defined by the Secretary).
       ``(4) Other permissible restrictions.--The Secretary may 
     impose limitations, with respect to all such drugs in a 
     therapeutic class, on the minimum or maximum quantities per 
     prescription or on the number of refills, if such limitations 
     are necessary to improve patient safety, discourage waste, or 
     address instances of fraud or abuse by individuals in any 
     manner authorized under this Act.
       ``(5) Development of initial formulary.--
       ``(A) In general.--In selecting covered part D drugs for 
     inclusion in a formulary, the Secretary shall consider 
     clinical benefit and price.
       ``(B) Role of ahrq.--The Director of the Agency for 
     Healthcare Research and Quality shall be responsible for 
     assessing the clinical benefit of covered part D drugs and 
     making recommendations to the Secretary regarding which drugs 
     should be included in the formulary. In conducting such 
     assessments and making such recommendations, the Director 
     shall--
       ``(i) consider safety concerns including those identified 
     by the Federal Food and Drug Administration;
       ``(ii) use available data and evaluations, with priority 
     given to randomized controlled trials, to examine clinical 
     effectiveness, comparative effectiveness, safety, and 
     enhanced compliance with a drug regimen;
       ``(iii) use the same classes of drugs developed by United 
     States Pharmacopeia for this part;
       ``(iv) consider evaluations made by--

       ``(I) the Director under section 1013 of Medicare 
     Prescription Drug, Improvement, and Modernization Act of 
     2003;
       ``(II) other Federal entities, such as the Secretary of 
     Veterans Affairs; and
       ``(III) other private and public entities, such as the Drug 
     Effectiveness Review Project and Medicaid programs; and

       ``(v) recommend to the Secretary--

       ``(I) those drugs in a class that provide a greater 
     clinical benefit, including fewer safety concerns or less 
     risk of side-effects, than another drug in the same class 
     that should be included in the formulary;
       ``(II) those drugs in a class that provide less clinical 
     benefit, including greater safety concerns or a greater risk 
     of side-effects, than another drug in the same class that 
     should be excluded from the formulary; and
       ``(III) drugs in a class with same or similar clinical 
     benefit for which it would be appropriate for the Secretary 
     to competitively bid (or negotiate) for placement on the 
     formulary.

       ``(C) Consideration of ahrq recommendations.--
       ``(i) In general.--Not later than January 1, 2011, the 
     Secretary, after taking into consideration the 
     recommendations under subparagraph (B)(v), shall establish a 
     formulary, and formulary incentives, to encourage use of 
     covered part D drugs that--

       ``(I) have a lower cost and provide a greater clinical 
     benefit than other drugs;
       ``(II) have a lower cost than other drugs with same or 
     similar clinical benefit; and
       ``(III) drugs that have the same cost but provide greater 
     clinical benefit than other drugs.

       ``(ii) Formulary incentives.--The formulary incentives 
     under clause (i) may be in the form of one or more of the 
     following:

       ``(I) Tiered copayments.
       ``(II) Prior authorization.
       ``(III) Step therapy.
       ``(IV) Medication therapy management.
       ``(V) Generic drug substitution.

       ``(iii) Flexibility.--In applying such formulary incentives 
     the Secretary may decide not to impose any cost-sharing for a 
     covered part D drug for which--

       ``(I) the elimination of cost sharing would be expected to 
     increase compliance with a drug regimen; and
       ``(II) compliance would be expected to produce savings 
     under part A or B or both.

       ``(iv) Development of transparent process to explain 
     formulary incentives.--Not later than January 1, 2011, the 
     Secretary shall develop and implement a transparent process 
     to identify and explain to beneficiaries formulary incentives 
     under clause (i). Such process shall be designed to assist 
     beneficiaries in understanding how prior authorization 
     requests and other formulary incentives will be evaluated.
       ``(6) Limitations on formulary.--In any formulary 
     established under this subsection, the formulary may not be 
     changed during a year, except--
       ``(A) to add a generic version of a covered part D drug 
     that entered the market;
       ``(B) to remove such a drug for which a safety problem is 
     found; and
       ``(C) to add a drug that the Secretary identifies as a drug 
     which treats a condition for which there has not previously 
     been a treatment option or for which a clear and significant 
     benefit has been demonstrated over other covered part D 
     drugs.
       ``(7) Adding drugs to the initial formulary.--
       ``(A) Use of advisory committee.--The Secretary shall 
     establish and appoint an advisory committee (in this 
     paragraph referred to as the `advisory committee')--
       ``(i) to review petitions from drug manufacturers, health 
     care provider organizations, patient groups, and other 
     entities for inclusion of a drug in, or other changes to, 
     such formulary; and
       ``(ii) to recommend any changes to the formulary 
     established under this subsection.
       ``(B) Composition.--The advisory committee shall be 
     composed of 9 members and shall include representatives of 
     physicians, pharmacists, and consumers and others with 
     expertise in evaluating prescription drugs. The Secretary 
     shall select members based on their knowledge of 
     pharmaceuticals and the Medicare and Medicaid populations. 
     Members shall be deemed to be special Government employees 
     for purposes of applying the conflict of interest provisions 
     under section 208 of title 18, United States Code, and no 
     waiver of such provisions for such a member shall be 
     permitted.

[[Page S9033]]

       ``(C) Consultation.--The advisory committee shall consult, 
     as necessary, with physicians who are specialists in treating 
     the disease for which a drug is being considered.
       ``(D) Request for studies.--The advisory committee may 
     request the Agency for Healthcare Research and Quality or an 
     academic or research institution to study and make a report 
     on a petition described in subparagraph (A)(ii) in order to 
     assess--
       ``(i) clinical effectiveness;
       ``(ii) comparative effectiveness;
       ``(iii) safety; and
       ``(iv) enhanced compliance with a drug regimen.
       ``(E) Recommendations.--The advisory committee shall make 
     recommendations to the Secretary regarding--
       ``(i) whether a covered part D drug is found to provide a 
     greater clinical benefit, including fewer safety concerns or 
     less risk of side-effects, than another drug in the same 
     class that is currently included in the formulary and should 
     be included in the formulary;
       ``(ii) whether a covered part D drug is found to provide 
     less clinical benefit, including greater safety concerns or a 
     greater risk of side-effects, than another drug in the same 
     class that is currently included in the formulary and should 
     not be included in the formulary; and
       ``(iii) whether a covered part D drug has the same or 
     similar clinical benefit to a drug in the same class that is 
     currently included in the formulary and whether the drug 
     should be included in the formulary.
       ``(F) Limitations on review of manufacturer petitions.--The 
     advisory committee shall not review a petition of a drug 
     manufacturer under subparagraph (A)(ii) with respect to a 
     covered part D drug unless the petition is accompanied by the 
     following:
       ``(i) Raw data from clinical trials on the safety and 
     effectiveness of the drug.
       ``(ii) Any data from clinical trials conducted using active 
     controls on the drug or drugs that are the current standard 
     of care.
       ``(iii) Any available data on comparative effectiveness of 
     the drug.
       ``(iv) Any other information the Secretary requires for the 
     advisory committee to complete its review.
       ``(G) Response to recommendations.--The Secretary shall 
     review the recommendations of the advisory committee and if 
     the Secretary accepts such recommendations the Secretary 
     shall modify the formulary established under this subsection 
     accordingly. Nothing in this section shall preclude the 
     Secretary from adding to the formulary a drug for which the 
     Director of the Agency for Healthcare Research and Quality or 
     the advisory committee has not made a recommendation.
       ``(H) Notice of changes.--The Secretary shall provide 
     timely notice to beneficiaries and health professionals about 
     changes to the formulary or formulary incentives.
       ``(I) Stability of benefit.--Once a covered part D drug has 
     been added to the formulary established under this 
     subsection, the drug may not be removed from the formulary 
     for at least a 3-year period, unless the Secretary determines 
     there are safety or efficacy concerns with respect to the 
     drug.
       ``(8) Non-excludable drugs.--The following drugs or classes 
     of drugs shall not be excluded from the default initial 
     formulary (as described in paragraph (1)(B)) or the initial 
     formulary established by the Secretary (as described in 
     paragraph (5)):
       ``(A) Barbiturates.
       ``(B) Benzodiazepines.
       ``(e) Informing Beneficiaries.--
       ``(1) In general.--The Secretary shall take steps to inform 
     beneficiaries about the availability of a Medicare operated 
     prescription drug plan or plans including providing 
     information in the annual handbook distributed to all 
     beneficiaries and adding information to the official public 
     Medicare website related to prescription drug coverage 
     available through this part.
       ``(2) Sole responsibility for marketing by the secretary.--
       ``(A) In general.--The Secretary shall have sole 
     responsibility for marketing Medicare operated prescription 
     drug plans.
       ``(B) Authorization.--There is authorized to be 
     appropriated to the Secretary such sums as are necessary to 
     carry out such marketing.
       ``(f) Application of All Other Requirements for 
     Prescription Drug Plans.--Except as specifically provided in 
     this section, any Medicare operated drug plan shall meet the 
     same requirements as apply to any other prescription drug 
     plan, including the requirements of section 1860D-4(b)(1) 
     relating to assuring pharmacy access.
       ``(g) Automatic Enrollment.--The Secretary shall establish 
     procedures to provide for the automatic enrollment of subsidy 
     eligible individuals (as defined in section 1860D-14(a)(3)) 
     in a Medicare operated prescription drug plan in the case 
     where such individuals lose their current prescription drug 
     coverage, become part D eligible individuals, or in instances 
     where the amount of the monthly beneficiary premium under the 
     prescription drug plan the individual is enrolled in is 
     greater than the premium subsidy amount described in section 
     1860D-14(b).
       ``(h) Rule of Construction Regarding Eligibility for 
     Medical Assistance.--In no case may enrollment in a Medicare 
     operated prescription drug plan affect the eligibility of an 
     individual to receive medical assistance under a State plan 
     under title XIX.''.
       (2) Effective date.--The amendment made by this subsection 
     shall take effect as if included in the enactment of section 
     101 of the Medicare Prescription Drug, Improvement, and 
     Modernization Act of 2003.
       (b) Conforming Amendments.--
       (1) In general.--
       (A) Section 1860D-3(a) of the Social Security Act (42 
     U.S.C. 1395w-103(a)) is amended by adding at the end the 
     following new paragraph:
       ``(4) Availability of the medicare operated prescription 
     drug plan.--A Medicare operated prescription drug plan (as 
     defined in section 1860D-11A(c)) shall be offered nationally 
     in accordance with section 1860D-11A.''.
       (B)(i) Section 1860D-3 of the Social Security Act (42 
     U.S.C. 1395w-103) is amended by adding at the end the 
     following new subsection:
       ``(c) Provisions Only Applicable in 2006, 2007, 2008, and 
     2009.--The provisions of this section shall only apply with 
     respect to 2006, 2007, 2008, and 2009.''.
       (C) Section 1860D-11(g) of such Act (42 U.S.C. 1395w-
     111(g)) is amended by adding at the end the following new 
     paragraph:
       ``(8) No authority for fallback plans after 2009.--A 
     fallback prescription drug plan shall not be available after 
     December 31, 2009.''.
       (D) Section 1860D-13(c)(3) of such Act (42 U.S.C. 1395w-
     113(c)(3)) is amended--
       (i) in the heading, by inserting ``and medicare operated 
     prescription drug plans'' after ``Fallback plans''; and
       (ii) by inserting ``or a Medicare operated prescription 
     drug plan'' after ``a fallback prescription drug plan''.
       (E) Section 1860D-14(a) of the Social Security Act (42 
     U.S.C. 1395w-114(a)) is amended--
       (i) in paragraph (1), by striking ``In the'' and inserting 
     ``Subject to section 1860D-11A(c)(2)(A), in the''; and
       (ii) in paragraph (2), by striking ``In the'' and inserting 
     ``Subject to section 1860D-11A(c)(2)(B), in the''.
       (F) Section 1860D-16(b)(1) of such Act (42 U.S.C.1395w-
     116(b)(1)) is amended--
       (i) in subparagraph (C), by striking ``and'' after the 
     semicolon at the end;
       (ii) in subparagraph (D), by striking the period at the end 
     and inserting ``; and''; and
       (G) by adding at the end the following new subparagraph:
       ``(E) payments for expenses incurred with respect to the 
     operation of Medicare operated prescription drug plans under 
     section 1860D-11A.''.
       (H) Section 1860D-41(a) of such Act (42 U.S.C. 1395w-
     151(a)) is amended by adding at the end the following new 
     paragraph:
       ``(19) Medicare operated prescription drug plan.--The term 
     `Medicare operated prescription drug plan' has the meaning 
     given such term in section 1860D-11A(c).''.
       (2) Effective date.--The amendments made by this subsection 
     shall take effect as if included in the enactment of section 
     101 of the Medicare Prescription Drug, Improvement, and 
     Modernization Act of 2003.

     SEC. 103. ACCREDITATION REQUIREMENT FOR ALL SPECIALIZED 
                   MEDICARE ADVANTAGE PLANS AND REVISIONS RELATING 
                   TO SPECIALIZED MEDICARE ADVANTAGE PLANS FOR 
                   SPECIAL NEEDS INDIVIDUALS.

       (a) Accreditation Requirement.--Section 1859(f) of the 
     Social Security Act (42 U.S.C. 1395w-28(f)) is amended--
       (1) in paragraphs (2)(B), (3)(B), and (4)(B), by striking 
     ``paragraph (5)'' and inserting ``paragraphs (5) and (6)(B)'' 
     each place it appears; and
       (2) by adding at the end the following new paragraph:
       ``(6) Accreditation requirement for all snps.--
       ``(A) Establishment of accreditation program.--Not later 
     than January 1, 2011, the Secretary, acting through the 
     Director of the Agency for Healthcare Research and Quality 
     and the Administrator of the Centers for Medicare & Medicaid 
     Services, shall enter into a contract with the National 
     Committee for Quality Assurance under which the National 
     Committee for Quality Assurance shall develop an 
     accreditation (and reaccreditation) program for all 
     specialized MA plans for special needs individuals (as 
     defined in subsection (b)(6)), including specialized MA plans 
     for special needs individuals described in subsection 
     (b)(6)(B)(ii).
       ``(B) Requirement.--The requirement described in this 
     subparagraph is that, effective for plan years beginning on 
     or after January 1, 2012, a specialized MA plan for special 
     needs individuals (as so defined) meet the accreditation 
     standards developed by the National Committee for Quality 
     Assurance under the contract under subparagraph (A).''.
       (b) Revisions Relating to Specialized Medicare Advantage 
     Plans for Special Needs Individuals.--Section 1859 of the 
     Social Security Act (42 U.S.C. 1395w-28) is amended--
       (1) in subsection (f)(3)--
       (A) in subparagraph (D), in the first sentence, by 
     inserting ``and the plan provides for the coordination of 
     coverage for benefits under this title (including this part) 
     and such medical assistance'' before the period at the end; 
     and
       (B) by adding at the end the following new subparagraph:
       ``(E) The plan meets the requirements described in 
     subsection (g).''; and
       (2) by adding at the end the following new subsection:
       ``(g) Additional Requirements for Dual SNPS.--The following 
     requirements are described in this subsection:
       ``(1) Provision of information.--The plan provides special 
     needs individuals described

[[Page S9034]]

     in subsection (b)(6)(B)(ii) up-front information about 
     formularies and utilization management strategies under the 
     plan as part of the information disclosed under section 
     1852(c)(1).
       ``(2) Premium.--The premium under the plan does not exceed 
     the premium subsidy amount described in section 1860D-14(b).
       ``(3) Formulary.--
       ``(A) In general.--Subject to subparagraph (B), the plan 
     has a formulary that, based on the most recent data 
     available, covers at least--
       ``(i) 95 percent of the 200 most commonly prescribed non-
     duplicative generic covered part D drugs for the population 
     of individuals entitled to (or enrolled for) benefits under 
     part A or enrolled under part B; and
       ``(ii) 95 percent of the 200 most commonly prescribed non-
     duplicative brand name covered part D drugs for such 
     population.
       ``(B) Inclusion of drugs in certain categories and 
     classes.--The plan formulary shall include all covered part D 
     drugs in the categories and classes identified by the 
     Secretary under section 1860D-4(b)(3)(G)(i).
       ``(4) Pharmacy access.--The plan secures participation in 
     its network of a sufficient number of pharmacies that 
     dispense (other than by mail order) drugs directly to 
     patients to ensure convenient access by at least 90 percent 
     of enrollees who are residing in long-term care facilities 
     within the region.
       ``(5) Operation of a dedicated customer assistance phone 
     line.--The plan shall maintain a toll-free number or numbers 
     for inquiries concerning the plan that is solely for the use 
     of such individuals, the designated representatives of such 
     individuals (including designated family members), advocates 
     of such individuals, providers of services, and suppliers.
       ``(6) E-prescribing.--The plan adopts electronic 
     prescribing for enrollees, in accordance with section 1860D-
     4(e), to coordinate care.
       ``(7) Demonstrate experience and expertise.--The plan 
     demonstrates, to the satisfaction of the Secretary, with 
     input from the States, sufficient experience and expertise in 
     serving low-income, publicly insured, or previously uninsured 
     populations.
       ``(8) Reducing health disparities.--The plan has 
     established and implemented systems and processes which have 
     been approved by the Secretary to address and reduce health 
     disparities based on race, ethnicity, gender, age, and socio-
     economic status.
       ``(9) Proficiency in care coordination.--The plan 
     demonstrates, to the satisfaction of the Secretary, 
     proficiency in care coordination for the purpose of 
     providing, or arranging for the provision of, services to 
     assist individuals enrolled in the plan in obtaining access 
     to other public and private benefits, including services to 
     address non-medical and psycho-social needs.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to plan year beginning on or after January 1, 
     2011.

     SEC. 104. PROVIDING BETTER CARE COORDINATION FOR LOW-INCOME 
                   BENEFICIARIES IN MEDICARE PART D.

       (a) Continuous Updating of Eligibility and Enrollment Data 
     for Dual Eligible Individuals.--
       (1) State requirement.--Section 1935(a) of the Social 
     Security Act (42 U.S.C. 1396u-5(a)) is amended by adding at 
     the end the following new paragraph:
       ``(4) Updating of eligibility and enrollment information on 
     a rolling basis.--Beginning not later than October 1, 2011, 
     the State shall update information with respect to the 
     eligibility and enrollment of individuals receiving any kind 
     of medical assistance under the State plan, including medical 
     assistance for payment of Medicare cost-sharing described in 
     section 1905(p)(3), in MA plans and prescription drug plans 
     under parts C and D, respectively, of title XVIII (including 
     eligibility determinations under paragraph (2) and screening 
     and enrollment under paragraph (3)) not less frequently than 
     on a weekly basis.''.
       (2) Secretarial requirements.--Section 1935(d) of the 
     Social Security Act (42 U.S.C. 1396u-5(d)) is amended by 
     adding at the end the following new paragraph:
       ``(3) Updating of eligibility and enrollment information on 
     a rolling basis.--The Secretary shall update information with 
     respect to the eligibility and enrollment of individuals 
     receiving any kind of medical assistance under this title, 
     including medical assistance for payment of Medicare cost-
     sharing described in section 1905(p)(3), in MA plans and 
     prescription drug plans under parts C and D, respectively, of 
     title XVIII as it is received, but not less frequently than 
     on a weekly basis.''.
       (b) Identifying Dual Eligible Individuals in Data 
     Records.--
       (1) In general.--Section 1859 of the Social Security Act 
     (42 U.S.C. 1305w-28), as amended by section 103, is amended 
     by adding at the end the following new subsection:
       ``(h) Identifying Dual Eligible Individuals in Data 
     Records.--
       ``(1) Identification by the secretary.--Beginning on 
     January 1, 2010, the Secretary shall clearly identify all 
     dual eligible individuals that are enrolled in MA plans and 
     prescription drug plans for the current plan year and reflect 
     the low-income subsidy status of such individuals for each 
     plan year in every data record file maintained in the 
     Medicare electronic database and every such file that is used 
     to enroll or adjudicate claims for such individuals.
       ``(2) Identification by ma plans and prescription drug 
     plans.--Beginning on January 1, 2010, each MA plan and 
     prescription drug plan shall clearly identify all dual 
     eligible individuals that are enrolled in the plan for the 
     current plan year and reflect the low-income subsidy status 
     of such individuals for the plan year in every data record 
     file maintained by the plan that is used to enroll or 
     adjudicate claims for such individuals under the plan.
       ``(3) Regulations.--The Secretary shall establish 
     regulations to carry out this subsection. Such regulations 
     shall require that--
       ``(A) for each plan year and each dual eligible individual, 
     the Secretary identify on the Medicare enrollment database 
     dual eligible status that has been verified with a State or 
     the District of Columbia;
       ``(B) for each plan year and each dual eligible individual, 
     the Secretary identify on the Medicare enrollment database 
     the low-income subsidy level of the individual; and
       ``(C) each data file that is necessary to ensure that such 
     dual eligible status is transmitted to an MA plan or a 
     prescription drug plan, at the time the Secretary certifies 
     the enrollment of the dual eligible individual in the plan.
       ``(4) Definition of dual eligible individual.--The term 
     `dual eligible individual' means a special needs individual 
     described in subsection (b)(6)(B)(ii).''.
       (2) Conforming amendment.--Section 1860D-42 of the Social 
     Security Act (42 U.S.C. 1395w-152) is amended by adding at 
     the end the following new subsection:
       ``(c) Identifying Dual Eligible Individuals in Data 
     Records.--For provisions regarding the identification by 
     prescription drug plans of dual eligible individuals in data 
     records, see section 1859(h).''.
       (c) Assuring Continuity of Prescription Drug Coverage for 
     Dual Eligibles.--
       (1) In general.--Section 1935(d)(1) of the Social Security 
     Act (42 U.S.C. 1396u-5(d)(1)) is amended--
       (A) by inserting ``on and after the date described in 
     subparagraph (B),'' after ``notwithstanding any other 
     provision of this title,'';
       (B) by striking ``In the case of'' and inserting the 
     following:
       ``(A) In general.--In the case of''; and
       (C) by adding at the end the following:
       ``(B) Date described.--For purposes of subparagraph (A), 
     the date described in this subparagraph is the date on which 
     the State confirms with a Medicare Advantage plan under part 
     C of title XVIII or a prescription drug plan under part D of 
     such title (including a Medicare operated prescription drug 
     plan under section 1860D-11A), as applicable--
       ``(i) that the part D eligible individual (as so defined) 
     who is described in subsection (c)(6)(A)(ii) is enrolled with 
     such plan; and
       ``(ii) the cost-sharing and premiums applicable for the 
     individual for such plan.''.
       (2) Effective date.--The amendments made by paragraph (1) 
     take effect on January 1, 2011.
       (d) Collection and Sharing of Drug Utilization Data and 
     Formulary Information for Full-Benefit Dual Eligible 
     Individuals.--
       (1) In general.--Section 1860D-42 of the Social Security 
     Act, as amended by subsection (b), is amended by adding at 
     the end the following new subsection:
       ``(d) Collection and Sharing of Drug Utilization Data and 
     Formulary Information for Full-Benefit Dual Eligible 
     Individuals.--
       ``(1) Plan requirement.--A PDP sponsor of a prescription 
     drug plan (including a Medicare operated prescription drug 
     plan under section 1860D-11A) and an MA organization offering 
     an MA-PD plan shall submit to the Secretary such information 
     regarding the drug utilization of enrollees in such plans who 
     are full-benefit dual eligible individuals (as defined in 
     section 1935(c)(6)) and any formularies under the plans such 
     individuals are enrolled in as the Secretary determines 
     appropriate to carry out paragraph (2). Such information 
     shall be submitted--
       ``(A) on a rolling basis (as determined appropriate by the 
     Secretary); and
       ``(B) using a single, uniform reporting process.
       ``(2) Collection and sharing of data.--The Secretary shall 
     collect data on the drug utilization of full-benefit dual 
     eligible individuals (as so defined) and on any formularies 
     under the plans such individuals are enrolled in. The 
     Secretary shall share such data with the States and the 
     District of Columbia on as close to a real-time basis as 
     possible.''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall take effect on January 1, 2010.

     SEC. 105. IMPROVING TRANSITION OF NEW DUAL ELIGIBLE 
                   INDIVIDUALS TO MEDICARE PRESCRIPTION DRUG 
                   COVERAGE AND PRESUMPTIVE ELIGIBILITY FOR LOW-
                   INCOME SUBSIDIES.

       (a) Updating the Point of Sale Facilitated Enrollment 
     Process.--
       (1) Providing better initial protection for dual eligible 
     individuals.--Beginning January 1, 2011, each contractor 
     under the Point of Sale Facilitated Enrollment process of the 
     Department of Health and Human Services shall enroll full-
     benefit dual eligible individuals (as defined in section 
     1935(c)(6)) into a Medicare operated prescription drug plan 
     under section 1860D-11A of the Social Security Act, as added 
     by section 102.

[[Page S9035]]

       (2) Competitive bidding of point of sale contract.--The 
     Secretary of Health and Human Services shall establish 
     procedures to ensure that each contract entered into under 
     such process on or after January 1, 2010, under the Medicare 
     program under title XVIII of the Social Security Act is rebid 
     every 3 years through a competitive bidding process.
       (3) Requiring better education about point of sale 
     facilitated enrollment process.--Not later than January 1, 
     2010, the Secretary of Health and Human Services shall have a 
     comprehensive plan in place for proactively educating 
     beneficiaries under the Medicare prescription drug program 
     under part D of title XVIII of the Social Security Act, 
     pharmacists, skilled nursing facilities (as defined in 
     section 1819(a) of such Act (42 U.S.C. 1395i-3(a)), nursing 
     facilities (as defined in section 1919(a) of such Act (42 
     U.S.C. 1396r(a)), counselors under State health insurance 
     assistance programs (SHIPs), and other advocacy organizations 
     (including disability organizations) about the Point of Sale 
     Facilitated Enrollment process. Under such plan--
       (A) information about the Point of Sale Facilitated 
     Enrollment process shall be included in all mailers to the 
     entities and individuals described in the preceding sentence 
     prior to the annual, coordinated election period described in 
     section 1851(e)(3) of the Social Security Act (42 U.S.C. 
     1395w-21(e)(3)); and
       (B) a description of such process and other relevant 
     information shall be prominently displayed on the Medicare 
     Internet website throughout the year.
       (4) Mandatory use of point of sale facilitated enrollment 
     process.--Section 1860D-4(b)(1) of the Social Security Act 
     (42 U.S.C. 1395w-104(b)(1)) is amended by adding at the end 
     the following new subparagraph:
       ``(F) Mandatory use of point of sale facilitated enrollment 
     process.--Notwithstanding any other provision of law, 
     beginning January 1, 2011, the terms and conditions under 
     subparagraph (A) shall require participating pharmacies to 
     use the Point of Sale Facilitated Enrollment process of the 
     Department of Health and Human Services.''.
       (b) Presumptive Eligibility and Mandatory Transition Period 
     for Subsidy Eligible Individuals.--Section 1860D-14 of the 
     Social Security Act (42 U.S.C. 1395w-104) is amended--
       (1) by redesignating subsection (d) as subsection (e); and
       (2) by inserting after subsection (c) the following new 
     subsection:
       ``(d) Presumptive Eligibility and Mandatory Transition 
     Period.--
       ``(1) Presumptive eligibility.--An individual shall be 
     presumed to be a subsidy eligible individual (as defined in 
     section 1860D-14(a)(3)) if the individual presents at the 
     pharmacy with--
       ``(A) reliable evidence of--
       ``(i) Medicaid enrollment, such as a Medicaid card, recent 
     history of Medicaid billing in the pharmacy patient profile, 
     a copy of a current Medicaid award letter, or confirmation 
     from a Medicaid enrollment database; or
       ``(ii) eligibility for an income-related subsidy under 
     section 1860D-14, such as a low-income subsidy notice from 
     the Secretary or the Commissioner of Social Security, or 
     confirmation from a Social Security enrollment database; and
       ``(B) reliable evidence of Medicare enrollment, such as a 
     Medicare identification card, a Medicare enrollment approval 
     letter, a Medicare Summary Notice, or confirmation from an 
     official Medicare hotline or Medicare database.
       ``(2) Making subsidy eligible individuals whole.--
       ``(A) In general.--In the case of a subsidy eligible 
     individual (as so defined) who, between November 15, 2005 and 
     December 31, 2009, has wrongly been forced to pay higher co-
     payments, premiums, and deductibles than those applicable 
     under this part and part C for such individual, the subsidy 
     eligible individual shall be eligible for compensation under 
     the program under this title.
       ``(B) Establishment of process for refund of amount 
     incorrectly paid.--The Secretary shall establish a process 
     under which--
       ``(i) prescription drug plans and MA-PD plans are billed 
     for copayments and deductibles inappropriately charged to 
     subsidy eligible individuals during retroactive coverage 
     periods;
       ``(ii) the amounts incorrectly paid by the subsidy eligible 
     individual as a result of those inappropriate charges are 
     refunded directly to the individual, either through a rebate 
     on future payments of premiums under part B or through a 
     direct payment to the individual; and
       ``(iii) prescription drug plans and MA-PD plans are 
     required to provide detailed accounting to the Secretary of 
     the basis for any rebate or payment to a subsidy eligible 
     individual under this subparagraph, including the applicable 
     period of retroactive coverage for the subsidy eligible 
     individual and whether the rebate or credit is with respect 
     to an inappropriately charged copayment or deductible,
       ``(C) Notification.--Subsidy eligible individuals shall be 
     notified of the requirements of this subsection in their 2010 
     plan year materials.
       ``(D) No effect on eligibility for other benefits.--Amounts 
     refunded to a subsidy eligible individual under this 
     subsection shall be disregarded for purposes of determining 
     or continuing the beneficiary's eligibility for receipt of 
     benefits under any other Federal, State, or locally funded 
     assistance program, including benefits paid under titles II, 
     XVI, XVIII, XIX, or XXI.''.

     SEC. 106. REQUIRED INFORMATION ON TRANSITION FROM SKILLED 
                   NURSING FACILITIES AND NURSING FACILITIES TO 
                   PART D PLANS.

       (a) Skilled Nursing Facilities.--Section 1819(b) of the 
     Social Security Act (42 U.S.C. 1395i-3(b)) is amended by 
     adding at the end the following new paragraph:
       ``(9) Information on transition to prescription drug 
     coverage.--A skilled nursing facility must provide 
     information to residents and the families of residents on how 
     to transition to prescription drug coverage under MA-PD plans 
     under part C and prescription drug plans under part D upon 
     discharge from the facility.''.
       (b) Nursing Facilities.--Section 1919(b) of the Social 
     Security Act (42 U.S.C. 1395i-3(b)) is amended by adding at 
     the end the following new paragraph:
       ``(9) Information on transitioning to prescription drug 
     coverage.--A nursing facility must provide information to 
     residents and the families of residents on how to transition 
     to prescription drug coverage under MA-PD plans under part C 
     and prescription drug plans under part D upon discharge from 
     the facility.''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 2011.

     SEC. 107. STREAMLINED PHARMACY COMPLIANCE PACKAGING.

       (a) In General.--Section 1860D-4(b)(3) of the Social 
     Security Act (42 U.S.C. 1395w--104(b)(3) is amended by adding 
     at the end the following new subparagraph:
       ``(G) Streamlined pharmacy compliance packaging for dual 
     eligible individuals.--A PDP sponsor of a prescription drug 
     plan shall streamline pharmacy compliance packaging for 
     individuals enrolled in the plan who--
       ``(i) are entitled to medical assistance under a State plan 
     under title XVIII; and
       ``(ii) reside in a nursing home.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply to drugs dispensed on or after January 1, 2010.

     SEC. 108. LOWERING COVERED PART D DRUG PRICES ON BEHALF OF 
                   MEDICARE BENEFICIARIES.

       (a) Repeal of Prohibition.--Section 1860D-11 of the Social 
     Security Act (42 U.S.C. 1395w-111) is amended by striking 
     subsection (i) and inserting the following:
       ``(i) Lowering Covered Part D Drug Prices.--
       ``(1) In general.--The Secretary shall reduce the purchase 
     cost of covered part D drugs by implementing 2 or more of the 
     following strategies on an annual basis (beginning with 
     2011):
       ``(A) Negotiating directly with pharmaceutical 
     manufacturers for additional discounts, rebates, and other 
     price concessions that may be made available to Medicare 
     operated prescription drug plans under section 1860D-11A for 
     covered part D drugs.
       ``(B) Entering into rebate agreements with manufacturers to 
     provide to the Secretary a rebate for any covered outpatient 
     drug of a manufacturer dispensed during a rebate period 
     specified in the agreement to a subsidy eligible individual 
     described (or treated as described) in section 1860D-
     14(a)(1)) for which payment was made by a PDP sponsor under 
     part D of title XVIII or an MA organization under part C of 
     such title for such period in an amount determined in the 
     same manner as the rebate amount for such drug would have 
     been determined under subsection (c) of section 1927 if the 
     dispensing of the drug to such individual was paid for by a 
     State and subject to a rebate agreement entered into under 
     such section (and allocating any such rebates received among 
     the prescription drug plans of such PDP sponsors and MA-PD 
     plans offered by such organizations based on the enrollment 
     of such individuals in such plans).
       ``(C) In consultation with the Director of the Agency for 
     Healthcare Research and Quality, using data from relevant and 
     unbiased studies on the comparative clinical effectiveness of 
     covered part D drugs to--
       ``(i) educate physicians and pharmacists; and
       ``(ii) provide information to PDP sponsors of prescription 
     drug plans and MA organizations offering MA-PD plans for use 
     in making decisions regarding plan formularies.
       ``(D) Instituting prescription drug prices negotiated under 
     the Federal Supply Schedule of the General Services 
     Administration for the reimbursement of covered part D drugs.
       ``(2) Rule of construction.--Nothing in this subsection 
     shall be construed as preventing the PDP sponsor of a 
     prescription drug plan or an MA organization offering an MA-
     PD plan from obtaining a discount or reduction of the price 
     for a covered part D drug below the price negotiated by the 
     Secretary for a Medicare-operated plan under paragraph 
     (1)(A).
       ``(3) Annual reports to congress.--Not later than January 
     1, 2012, and annually thereafter, the Secretary shall submit 
     to the Committee on Finance of the Senate and to the 
     Committee on Ways and Means, the Committee on Energy and 
     Commerce, and the Committee on Oversight and Government 
     Reform of the House of Representatives a report on the 
     strategies implemented by the Secretary under paragraph (1) 
     to achieve lower prices on covered part D drugs

[[Page S9036]]

     for beneficiaries, including the prices of such covered part 
     D drugs and any price concessions achieved by the Secretary 
     as a result of such implementation.''.

     SEC. 109. CORRECTION OF FLAWS IN DETERMINATION OF PHASED-DOWN 
                   STATE CONTRIBUTION FOR FEDERAL ASSUMPTION OF 
                   PRESCRIPTION DRUG COSTS FOR DUALLY ELIGIBLE 
                   INDIVIDUALS.

       Section 1935(c) of the Social Security Act (42 U.S.C. 
     1396u-5(c)) is amended--
       (1) in paragraph (1), in the matter preceding subparagraph 
     (A), by striking ``Each'' and inserting ``Subject to 
     paragraph (7), each''; and
       (2) by adding at the end the following new paragraph:
       ``(7) Modification of determination of amount of state 
     contribution.--Not later than January 1, 2011, the Secretary 
     of Health and Human Services (in this section referred to as 
     the `Secretary'), acting through the Director of the Federal 
     Coordinated Health Care Office established under section 101 
     of the Medicare Prescription Drug Reform Act of 2009, shall 
     promulgate regulations for modifying the factors used to 
     determine the product under paragraph (1)(A) for each State 
     and month that take into account the following with respect 
     to each State:
       ``(A) Factoring into the determination of base year State 
     Medicaid per capita expenditures for covered part D drugs for 
     full-benefit dual eligible individuals under paragraph (3) 
     all payments collected by a State under agreements under 
     section 1927 for outpatient prescription drugs purchased in 
     2003 (not just for such payments that were collected by the 
     State in 2003).
       ``(B) Pharmacy cost savings measures implemented by the 
     State during the period that begins with 2003 and ends with 
     2006.
       ``(C) Substituting under paragraph (4) a State-specific 
     growth factor in lieu of the national applicable growth 
     factor for 2004 and succeeding years based on the annual 
     percentage increase in the State's average per capita 
     aggregate expenditures for covered outpatient drugs.

     Such regulations shall include procedures for adjusting 
     payments to States under section 1903(a) to take into account 
     any overpayments or underpayments which the Secretary 
     determines on the basis of such modifications were made by 
     States under this subsection for 2004 and succeeding 
     years.''.

     SEC. 110. NO IMPACT ON ELIGIBILITY FOR BENEFITS UNDER OTHER 
                   PROGRAMS.

       (a) In General.--Section 1860D-14(a)(3) of the Social 
     Security Act (42 U.S.C. 1395w-114(a)(3)), is amended--
       (1) in subparagraph (A), in the matter preceding clause 
     (i), by striking ``subparagraph (F)'' and inserting 
     ``subparagraphs (F) and (H)''; and
       (2) by adding at the end the following new subparagraph:
       ``(H) No impact on eligibility for benefits under other 
     programs.--The availability of premium and cost-sharing 
     subsidies under this section shall not be treated as benefits 
     or otherwise taken into account in determining an 
     individual's eligibility for, or the amount of benefits 
     under, any other Federal program.''.
       (b) Effective Date.--The amendments made by this section 
     shall take effect on the date of enactment of this Act.

     SEC. 111. QUALITY INDICATORS FOR DUAL ELIGIBLE INDIVIDUALS.

       Section 1154(a) of the Social Security Act (42 U.S.C. 
     1320c-3(a)) is amended by inserting after paragraph (11) the 
     following new paragraph:
       ``(12) For all contracts entered into on or after August 1, 
     2011, the organization shall produce a statistically valid 
     subsample of quality indicators applicable to dual eligible 
     beneficiaries under titles XVIII and XIX.''.

        TITLE II--ADDITIONAL MEDICARE AND MEDICAID IMPROVEMENTS

Subtitle A--Improving the Financial Assistance Available to Low-Income 
                         Medicare Beneficiaries

     SEC. 201. IMPROVING ASSETS TESTS FOR MEDICARE SAVINGS PROGRAM 
                   AND LOW-INCOME SUBSIDY PROGRAM.

       (a) Application of Highest Level Permitted Under LIS.--
       (1) To full-premium subsidy eligible individuals.--Section 
     1860D-14(a) of the Social Security Act (42 U.S.C. 1395w-
     114(a)) is amended--
       (A) in paragraph (1), in the matter before subparagraph 
     (A), by inserting ``(or, beginning with 2010, paragraph 
     (3)(E))'' after ``paragraph (3)(D)''; and
       (B) in paragraph (3)(A)(iii), by striking ``(D) or''.
       (2) Annual increase in lis resource test.--Section 1860D-
     14(a)(3)(E)(i) of the Social Security Act (42 U.S.C. 1395w-
     114(a)(3)(E)(i)) is amended--
       (A) by striking ``and'' at the end of subclause (I);
       (B) in subclause (II), by inserting ``(before 2010)'' after 
     ``subsequent year'';
       (C) by striking the period at the end of subclause (II) and 
     inserting a semicolon;
       (D) by inserting after subclause (II) the following new 
     subclauses:

       ``(III) for 2010, $27,500 (or $55,000 in the case of the 
     combined value of the individual's assets or resources and 
     the assets or resources of the individual's spouse); and
       ``(IV) for a subsequent year, the dollar amounts specified 
     in this subclause (or subclause (III)) for the previous year 
     increased by the annual percentage increase in the consumer 
     price index (all items; U.S. city average) as of September of 
     such previous year.''; and

       (E) in the last sentence, by inserting ``or (IV)'' after 
     ``subclause (II)''.
       (3) Application of lis test under medicare savings 
     program.--Section 1905(p)(1)(C) of the Social Security Act 
     (42 U.S.C. 1396d(p)(1)(C)) is amended by striking 
     ``subparagraph (D)'' and all that follows through the period 
     at the end and inserting the following: ``section 1860D-
     14(a)(3)(E) applicable to an individual or to the individual 
     and the individual's spouse (as the case may be)''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply to eligibility determinations for income-related 
     subsidies and Medicare cost-sharing furnished for periods 
     beginning on or after January 1, 2010.

     SEC. 202. ELIMINATING BARRIERS TO ENROLLMENT.

       (a) Encouraging Application of Procedures Under Medicare 
     Savings Program.--Section 1905(p) of the Social Security Act 
     (42 U.S.C. 1396d(p)) is amended by adding at the end the 
     following new paragraph:
       ``(7) The Secretary shall take all reasonable steps to 
     encourage States to provide for administrative verification 
     of income and automatic reenrollment (as provided under 
     subparagraphs (C)(iii) and (G) of section 1860D-14(a)(3) in 
     the case of the low-income subsidy program).''.
       (b) Ensuring That SSA and States Can Electronically Process 
     All Low-Income Subsidy Program Applications.--Section 1860D-
     14(a)(3)(B)(i) of the Social Security Act (42 U.S.C. 1395w-
     114(a)(3)(B)(i)) is amended by inserting after the first 
     sentence the following new sentence: ``Not later than January 
     1, 2012, the State plan and the Commissioner shall have in 
     place procedures to ensure the capacity to process all 
     applications for determinations (including all applications 
     that are not in English) electronically.''.

     SEC. 203. ELIMINATION OF PART D COST-SHARING FOR CERTAIN NON-
                   INSTITUTIONALIZED FULL-BENEFIT DUAL ELIGIBLE 
                   INDIVIDUALS.

       (a) In General.--Section 1860D-14(a)(1)(D)(i) of the Social 
     Security Act (42 U.S.C. 1395w-114(a)(1)(D)(i)) is amended--
       (1) in the heading, by striking ``Institutionalized 
     individuals.--In'' and inserting ``Elimination of cost-
     sharing for certain full-benefit dual eligible individuals.--

       ``(I) Institutionalized individuals.--In''; and

       (2) by adding at the end the following new subclauses:

       ``(II) Certain other individuals.--In the case of an 
     individual who is a full-benefit dual eligible individual and 
     who is being provided medical assistance for home and 
     community-based services under subsection (c), (d), (e), (i), 
     or (j) of section 1915 or pursuant to section 1115, the 
     elimination of any beneficiary coinsurance described in 
     section 1860D-2(b)(2) (for all amounts through the total 
     amount of expenditures at which benefits are available under 
     section 1860D-2(b)(4)).''.

       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply to drugs dispensed on or after January 1, 2010.

     SEC. 204. EXEMPTION OF BALANCE IN ANY PENSION OR RETIREMENT 
                   PLAN FROM RESOURCES FOR DETERMINATION OF 
                   ELIGIBILITY FOR LOW-INCOME SUBSIDY.

       (a) In General.--Section 1860D-14(a)(3) of the Social 
     Security Act (42 U.S.C. 1395w-114(a)(3)) is amended--
       (1) in subparagraph (D), in the matter before clause (i), 
     by striking ``life insurance policy exclusion provided under 
     subparagraph (G)''and inserting ``additional exclusions 
     provided under subparagraphs (G) and (H)'';
       (2) in subparagraph (E)(i), in the matter before subclause 
     (I), by striking ``life insurance policy exclusion provided 
     under subparagraph (G)''and inserting ``additional exclusions 
     provided under subparagraphs (G) and (H)''
       (3) by adding at the end the following new subparagraph:
       ``(H) Pension or retirement plan exclusion.--In determining 
     the resources of an individual (and the eligible spouse of 
     the individual, if any) under section 1613 for purposes of 
     subparagraphs (D) and (E), no balance in any pension or 
     retirement plan shall be taken into account.''.
       (b) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 2010, and shall apply to 
     determinations of eligibility for months beginning with 
     January 2010.

     SEC. 205. COST-SHARING PROTECTIONS FOR LOW-INCOME SUBSIDY-
                   ELIGIBLE INDIVIDUALS.

       (a) In General.--Section 1860D-14(a) of the Social Security 
     Act (42 U.S.C. 1395w-114(a)) is amended--
       (1) in paragraph (1)(D), by adding at the end the following 
     new clause:
       ``(iv) Overall limitation on cost-sharing.--In the case of 
     all such individuals, a limitation on aggregate cost-sharing 
     under this part for a year not to exceed 2.5 percent of 
     income.''; and
       (2) in paragraph (2), by adding at the end the following 
     new subparagraph:
       ``(F) Overall limitation on cost-sharing.--A limitation on 
     aggregate cost-sharing under this part for a year not to 
     exceed 2.5 percent of income.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply as of January 1, 2010.

[[Page S9037]]

                     Subtitle B--Other Improvements

     SEC. 211. ENROLLMENT IMPROVEMENTS UNDER MEDICARE PARTS C AND 
                   D.

       (a) Special Election Period During First 60 Days of 
     Enrollment in a New Plan.--
       (1) In general.--Section 1851(e)(4) of the Social Security 
     Act (42 U.S.C. 1395w(e)(4)) is amended--
       (A) in subparagraph (C), by striking ``or'' at the end;
       (B) by redesignating subparagraph (D) as subparagraph (E); 
     and
       (C) by inserting after subparagraph (C) the following new 
     subparagraph:
       ``(D) the individual has been enrolled in such plan for 
     fewer than 60 days; or''.
       (2) Effective date.--The amendments made by paragraph (1) 
     shall take effect on the date that is 90 days after the date 
     of enactment of this Act.
       (b) Extension of the Annual, Coordinated Election Period.--
       (1) In general.--Section 1851(e)(3)(B)(iv) of the Social 
     Security Act (42 U.S.C. 1395w-1(e)(3)(B)(iv)) is amended by 
     striking ``November 15'' and inserting ``October 1''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall apply to annual, coordinated election periods beginning 
     after the date of enactment of this Act.
       (c) Coordination Under Parts C and D of the Continuous Open 
     Enrollment and Disenrollment Period for the First 3 Months of 
     the Year.--
       (1) In general.--Section 1860D-1(b)(1)(B)(iii) of the 
     Social Security Act (42 U.S.C. 1395w-101(b)(1)(B)(iii)) is 
     amended by striking ``, (C),''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall take effect on January 1, 2010.

     SEC. 212. MEDICARE PLAN COMPLAINT SYSTEM.

       (a) System.--Section 1808 of the Social Security Act (42 
     U.S.C. 1395b-9) is amended--
       (1) in subsection (c)(2)--
       (A) in subparagraph (B)(iii), by striking ``adjustment; 
     and'' and inserting ``adjustment);'';
       (B) in subparagraph (C), by striking the period at the end 
     and inserting ``; and''; and
       (C) by adding at the end the following new subparagraph:
       ``(D) develop and maintain the plan complaint system under 
     subsection (d).''; and
       (2) by adding at the end the following new subsection:
       ``(d) Plan Complaint System.--
       ``(1) System.--
       ``(A) In general.--The Secretary shall develop and maintain 
     a plan complaint system, (in this subsection referred to as 
     the `system') to--
       ``(i) collect and maintain information on plan complaints;
       ``(ii) track plan complaints from the date the complaint is 
     logged into the system through the date the complaint is 
     resolved; and
       ``(iii) otherwise improve the process for reporting plan 
     complaints.
       ``(B) Timeframe.--The Secretary shall have the system in 
     place by not later than the date that is 6 months after the 
     date of enactment of this subsection.
       ``(C) Plan complaint defined.--In this subsection, the term 
     `plan complaint' means a complaint that is received 
     (including by telephone, letter, e-mail, or any other means) 
     by the Secretary (including by a regional office, the 
     Medicare Beneficiary Ombudsman, a subcontractor, a carrier, a 
     fiscal intermediary, and a Medicare administrative 
     contractor) from a Medicare Advantage eligible individual or 
     a Part D eligible individual (or an individual representing 
     such an individual) regarding a Medicare Advantage 
     organization, a Medicare Advantage plan, a prescription drug 
     plan sponsor, or a prescription drug plan, including, but not 
     limited to, complaints relating to marketing, enrollment, 
     covered drugs, premiums and cost-sharing, and plan customer 
     service, grievances and appeals, participating providers. 
     Such term also includes plan complaints that are received by 
     the Secretary directly from the organization offering the 
     plan relating to complaints by such individuals.
       ``(2) Process criteria.--In developing the system, the 
     Secretary shall establish a process for reporting plan 
     complaints. Such process shall meet the following criteria:
       ``(A) Accessible.--The process is widely known and easy to 
     use.
       ``(B) Investigative capacity.--The process involves the 
     appropriate experts, resources, and methods to assess 
     complaints and determine whether they reflect an underlying 
     pattern.
       ``(C) Intervention and follow-through.--The process 
     triggers appropriate interventions and monitoring based on 
     substantiated complaints.
       ``(D) Quality improvement orientation.--The process guides 
     quality improvement.
       ``(E) Responsiveness.--The process routinely provides 
     consistent, clear, and substantive responses to complaints.
       ``(F) Timelines.--Each process step is completed within a 
     reasonable, established timeframe, and mechanisms exist to 
     deal quickly with complaints of an emergency nature requiring 
     immediate attention.
       ``(G) Objective.--The process is unbiased, balancing the 
     rights of each party.
       ``(H) Public accountability.--The process makes complaint 
     information available to the public.
       ``(3) Standard data reporting requirements.--
       ``(A) In general.--The Secretary shall establish standard 
     data reporting requirements for reporting plan complaints 
     under the system.
       ``(B) Model electronic complaint form.--The Secretary shall 
     develop a model electronic complaint form to be used for 
     reporting plan complaints under the system. Such form shall 
     be prominently displayed on the front page of the 
     Medicare.gov Internet website and on the Internet website of 
     the Medicare Beneficiary Ombudsman.
       ``(4) All complaints required to be logged into the 
     system.--Every plan complaint shall be logged into the 
     system.
       ``(5) Casework notations.--The system shall provide for the 
     inclusion of any casework notations throughout the complaint 
     process on the record of a plan complaint.
       ``(6) Medicare beneficiary ombudsman.--The Secretary shall 
     carry out this subsection acting through the Medicare 
     Beneficiary Ombudsman.''.
       (b) Funding.--There are authorized to be appropriated such 
     sums as may be necessary for the costs of carrying out 
     section 1808(d) of the Social Security Act, as added by 
     subsection (a).
       (c) Reports.--
       (1) Secretary.--
       (A) Ongoing study.--The Medicare Beneficiary Ombudsman 
     (under subsection (c) of section 1808) of the Social Security 
     Act (42 U.S.C. 1395b-9) shall conduct an ongoing study of the 
     plan complaint system established under subsection (d) of 
     such section (as added by subsection (a)), in this subsection 
     referred to as the ``system''. Such study shall include an 
     analysis of--
       (i) the numbers and types of complaints reported under the 
     system;
       (ii) geographic variations in such complaints;
       (iii) the timeliness of agency or plan responses to such 
     complaints; and
       (iv) the resolution of such complaints.
       (B) Quarterly reports.--Not later than 6 months after the 
     implementation of the system, and every 3 months thereafter, 
     the Secretary of Health and Human Services shall submit to 
     Congress a report on the study conducted under subparagraph 
     (A), together with recommendations for such legislation and 
     administrative actions as the Secretary determines 
     appropriate.
       (2) Inspector general.--The Inspector General of the 
     Department of Health and Human Services shall conduct an 
     evaluation of the system. Not later than 1 year after the 
     implementation of the system, the Inspector General shall 
     submit to Congress a report on such evaluation, together with 
     recommendations for such legislation and administrative 
     actions as the Inspector General determines appropriate.

     SEC. 213. UNIFORM EXCEPTIONS AND APPEALS PROCESS.

       (a) In General.--Section 1860D-4(b)(3) of the Social 
     Security Act (42 U.S.C. 1395w--104(b)(3), as amended by 
     section 107, is amended by adding at the end the following 
     new subparagraph:
       ``(G) Use of single, uniform exceptions and appeals 
     process.--Notwithstanding any other provision of this part, a 
     PDP sponsor of a prescription drug plan or an MA organization 
     offering an MA-PD plan shall--
       ``(i) use a single, uniform exceptions and appeals process 
     with respect to the determination of prescription drug 
     coverage for an enrollee under the plan; and
       ``(ii) provide instant access to such process by enrollees 
     through a toll-free telephone number and an Internet 
     website.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply to exceptions and appeals on or after January 1, 
     2011.

     SEC. 214. PROHIBITION ON CONDITIONING MEDICAID ELIGIBILITY 
                   FOR INDIVIDUALS ENROLLED IN CERTAIN CREDITABLE 
                   PRESCRIPTION DRUG COVERAGE ON ENROLLMENT IN THE 
                   MEDICARE PART D DRUG PROGRAM.

       (a) In General.--Section 1935 of the Social Security Act 
     (42 U.S.C. 1396v) is amended by adding at the end the 
     following:
       ``(f) Prohibition on Conditioning Eligibility for Medical 
     Assistance for Individuals Enrolled in Certain Creditable 
     Prescription Drug Coverage on Enrollment in Medicare 
     Prescription Drug Benefit.--
       ``(1) In general.--A State shall not condition eligibility 
     for medical assistance under the State plan for a part D 
     eligible individual (as defined in section 1860D-1(a)(3)(A)) 
     who is enrolled in creditable prescription drug coverage 
     described in any of subparagraphs (C) through (H) of section 
     1860D-13(b)(4) on the individual's enrollment in a 
     prescription drug plan under part D of title XVIII or an MA-
     PD plan under part C of such title.
       ``(2) Coordination of benefits with part d for other 
     individuals.--Nothing in this subsection shall be construed 
     as prohibiting a State from coordinating medical assistance 
     under the State plan with benefits under part D of title 
     XVIII for individuals not described in paragraph (1).''.

     SEC. 215. OFFICE OF THE INSPECTOR GENERAL ANNUAL REPORT ON 
                   PART D FORMULARIES' INCLUSION OF DRUGS COMMONLY 
                   USED BY DUAL ELIGIBLES.

       (a) Ongoing Study.--The Inspector General of the Department 
     of Health and Human Services shall conduct an ongoing study 
     of the extent to which formularies used by prescription drug 
     plans and MA-PD plans under part D include drugs commonly 
     used by full-benefit dual eligible individuals (as defined in 
     section 1935(c)(6) of the Social Security Act (42 U.S.C. 
     1396u-5(c)(6)).

[[Page S9038]]

       (b) Annual Reports.--Not later than July 1 of each year 
     (beginning with 2010), the Inspector General shall submit to 
     Congress a report on the study conducted under paragraph (1), 
     together with such recommendations as the Inspector General 
     determines appropriate.

     SEC. 216. HHS ONGOING STUDY AND ANNUAL REPORTS ON COVERAGE 
                   FOR DUAL ELIGIBLES.

       (a) Ongoing Study.--
       (1) In general.--The Secretary of Health and Human Services 
     (in this section referred to as the ``Secretary'') shall 
     conduct an ongoing study to track--
       (A) how many of the new full benefit dual eligible 
     individuals (as defined in section 1935(c)(6) of the Social 
     Security Act (42 U.S.C. 1395u-5(c)(6))) enroll in a plan 
     under part D of title XVIII of such Act and receive 
     retroactive prescription drug coverage under the plan; and
       (B) if such retroactive coverage is provided to such 
     individuals--
       (i) the number of months of coverage provided; and
       (ii) the amount of reimbursements to individuals and to 
     individuals that made payments for prescription drugs on 
     their behalf for costs incurred during retroactive coverage 
     periods.
       (2) Data to use.--In conducting the study with respect to 
     the requirements under paragraph (1)(B), the Secretary shall 
     examine prescription drug utilization data reported by 
     Medicare part D plans.
       (b) Annual Reports on Ongoing Study.--Not later than March 
     1 of each year (beginning with 2010), the Secretary shall 
     submit a report to Congress containing the results of the 
     study conducted under subsection (a), together with 
     recommendations for such legislation and administrative 
     action as the Secretary determines appropriate.
       (c) Annual Reports on Spending and Outcomes.--Not later 
     than January 1 of each year (beginning with 2013), the 
     Secretary shall collect data and submit a report to Congress 
     that includes the following information:
       (1) Annual total expenditures (disaggregated by Federal and 
     State expenditures) for dually eligible beneficiaries under 
     title XVIII and under State plans and waivers under title 
     XIX.
       (2) An analysis of health outcomes for dually eligible 
     beneficiaries, disaggregated by subtypes of beneficiaries (as 
     determined by the Secretary).
       (3) An analysis of the extent to which dually eligible 
     beneficiaries are able to access benefits under title XVIII 
     and under State plans and waivers under title XIX.

     SEC. 217. AUTHORITY TO OBTAIN INFORMATION.

       Title XVIII of the Social Security Act (42 U.S.C. 1395 et 
     seq.) is amended by adding at the end the following new 
     section:


      ``authority of the comptroller general to obtain information

       ``Sec. 1899.  No provision in this Act in effect on the 
     date of enactment of this section or enacted after such date 
     shall be construed to limit, amend, or supersede the 
     authority of the Comptroller General of the United States to 
     obtain agency records pursuant to section 716 of title 31, 
     United States Code, including any information obtained by, or 
     disclosed to, the Secretary under part C or D of this title, 
     except to the extent that such provision expressly and 
     specifically refers to this section and provides for such 
     limitation, amendment, or supersession.''.
                                 ______