[Federal Register Volume 71, Number 134 (Thursday, July 13, 2006)]
[Notices]
[Pages 39683-39684]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-6192]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-4123-N]


Medicare Program; Solicitation for Proposals for Medical Savings 
Account Demonstration Project

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Notice.

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SUMMARY: This notice is to inform interested parties of an opportunity 
to apply to participate in the Medicare Advantage (MA) Medical Savings 
Account (MSA) demonstration project. The MA MSA demonstration design 
waives certain MA MSA plan requirements under sections 1859(b)(3), 
1853(e), and 1854(c) of the Social Security Act. This waiver will allow 
entities to offer products that more closely resemble high deductible 
health plans (HDHPs) that are offered with Health Savings Accounts to 
the non-Medicare population. This demonstration will be conducted in 
accordance with the Secretary's demonstration authority under section 
402(a)(1)(A) of the Social Security Amendments of 1967, 42 U.S.C. 
1395b-1(a)(1)(A).

DATES: Applications will be considered timely if we receive them by 
July 21, 2006.

FOR FURTHER INFORMATION CONTACT: Yolanda Robinson at (410) 786-7627. 
Interested parties can obtain a complete solicitation, application, and 
supporting information on the following CMS Web site at http://www.cms.hhs.gov/MedicareAdvantageApps/.

ADDRESSES: Mail or deliver applications and NOIs to the following 
address: Centers for Medicare and Medicaid Services, Attn: Yolanda 
Robinson CBC/MAG/DQPM, Mail Stop C4-23-07, 7500 Security Blvd., 
Baltimore, MD 21244.
    Because of staff and resource limitations, we cannot accept 
applications by facsimile (FAX) transmission or by e-mail.

SUPPLEMENTARY INFORMATION:

I. Background

    Sections 1851(a)(2)(C) and 1859(b)(3) of the Social Security Act 
(the Act) authorize Medicare Advantage plans to offer Medical Savings 
Accounts (MSAs) to beneficiaries. However, the required benefit 
structure is not perceived by insurance organizations as easily 
marketable. Similar to Health Savings Accounts (HSAs) accounts 
currently

[[Page 39684]]

available in the commercial market, the MSA demonstration allows more 
flexible benefits that will allow beneficiaries the freedom to exercise 
control over their health care spending while providing important 
protection against catastrophic health care costs. CMS is providing 
flexibility with this MSA demonstration project to make the 
increasingly popular consumer-directed plans available to Medicare 
beneficiaries. The demonstration framework includes the flexibility we 
are allowed under our demo authority.
    The goal of the demonstration is to test whether the consumer 
directed health plans in Medicare will help lower health care cost for 
enrollees without adversely affecting the quality of health care 
services. We expect that this demonstration will make ``HSA like'' MSAs 
available to Medicare beneficiaries beginning January 1, 2007.
    We are establishing this demonstration under section 402(a)(1)(A) 
of the Social Security Amendments of 1967, 42 U.S.C. Sec.  1395b-
1(a)(1)(A), which authorizes the Secretary to conduct demonstrations 
designed to test whether changes in methods of payment under Medicare 
would have the effect of increasing the efficiency and economy of 
Medicare services without adversely affecting the quality of services.

II. Provisions of the Notice

    The purpose of this notice is to inform Medicare Advantage 
organizations of an opportunity to apply to participate in the Medicare 
Advantage (MA) Medical Savings Account (MSA) demonstration project. To 
assist in the planning process, we have posted the MA MSA plan 
demonstration framework as well as the MA MSA application on our Web 
site at http://www.cms.hhs.gov/MedicareAdvantageApps/. The framework 
outlines specific parameters for design flexibilities. The MA MSA 
application must be completed and the benefit design must stay within 
the boundaries of the MA MSA plan demonstration framework. The 
applicant must provide an operational discussion of the following:
     Product offering;
     Deposit calculations;
     Recovery policy for the current-year deposit, and 
procedures for members who are disenrolled from the plan before the end 
of the contract year. (Note that disenrollment may occur only for the 
reasons such as death or moving out of the service area as specified in 
section 1851(e)(5)(B) of the Act);
     Items and services to be counted toward the member's 
deductible;
     Whether a Prescription Drug Plan will be offered by your 
organization and marketed to potential MSA enrollees;
     Policy and procedures on portability of the member's 
account;
     Use of networks and whether/how cost sharing and the 
member out-of-pocket maximum will vary in-network versus out-of-
network;
     Service area for product offering and whether it is 
individual and/or employer group; and
     Any other aspects making the product offering different 
from the statutory requirements of an MSA plan and as allowed under the 
framework.
    Medicare Advantage organizations interested in participating in 
2007 must submit a complete MA MSA application, which is available on 
the CMS Web site at http://www.cms.hhs.gov/MedicareAdvantageApps/, no 
later than July 21, 2006. Your organization's bid and benefit 
submission is due no later than August 10, 2006. Organizations 
interested in participating for 2008 are requested to submit an NOI to 
CMS as soon as possible for us to understand the level of future 
interest in the product. Submitting an NOI does not require your 
organization to apply, nor is it required to apply. The NOI form is 
posted at the above Web site.

III. Collection of Information Requirements

    This information collection requirement is subject to the Paperwork 
Reduction Act of 1995 (PRA); however, the collection is currently 
approved under OMB control number 0938-0935 entitled ``Medicare 
Advantage Applications'' with a current expiration date of July 31, 
2006.

    Authority: Section 402(a)(1)(A) of the Social Security Act, 42 
U.S.C. 1395b-1.

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical 
Assistance Program; No. 93.773 Medicare--Hospital Insurance Program; 
and No. 93.774, Medicare--Supplementary Medical Insurance Program)

    Dated: May 30, 2006.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. 06-6192 Filed 7-10-06; 4:07 pm]
BILLING CODE 4120-01-P