article: SECTION 1. SHORT TITLE; TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``Medicare+Choice Improvement and Stabilization Act of 2001''. (b) Table of Contents.--The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Payment reforms for 2003. Sec. 3. Change in Medicare+Choice reporting deadlines and annual, coordinated election period and delay in lock-in provisions. Sec. 4. Avoiding duplicative State regulation. Sec. 5. Demonstration projects for preferred provider organizations, point-of-service plans, MSA plans, and disease management programs. Sec. 6. Suspension of limitation for program reentry for 2003 and 2004. Sec. 7. Specialized Medicare+Choice plans for special needs beneficiaries. SEC. 2. PAYMENT REFORMS FOR 2003. (a) Payment Based on 100 Percent of Fee-for-Service Costs.-- (1) In general.--Section 1853(c)(1) of the Social Security Act (42 U.S.C. 1395w-23(c)(1)) is amended by adding at the end the following: ``(D) Based on 100 percent of fee-for-service costs for 2003.--For 2003 only, the adjusted average per capita cost for that year, determined under section 1876(a)(4) for the Medicare+Choice payment area for services covered under parts A and B for individuals entitled to benefits under part A and enrolled under part B who are not enrolled in a Medicare+Choice plan under this part for the year, subject to the same adjustment as is provided to the annual per capita rate payment under paragraph (3)(B).''. (2) Conforming amendment.--Such section is further amended in the matter before subparagraph (A), by striking ``or (C)'' and inserting ``(C), or (D)''. (b) Revision of National Average Used in Calculation of Blend.-- Section 1853(c)(4)(B)(i)(II) of such Act (42 U.S.C. 1395w- 23(c)(4)(B)(i)(II)) is amended by inserting ``who (with respect to determinations for 2003) are enrolled in a Medicare+Choice plan'' after ``the average number of medicare beneficiaries''. (c) Elimination of Budget Neutrality.--Section 1853(c) of such Act (42 U.S.C. 1395w-23(c)) is amended-- (1) in paragraph (1)(A), by inserting ``(for a year other than 2003)'' after ``multiplied''; and (2) in paragraph (5), by inserting ``(other than 2003)'' after ``for each year''. SEC. 3. CHANGE IN MEDICARE+CHOICE REPORTING DEADLINES AND ANNUAL, COORDINATED ELECTION PERIOD AND DELAY IN LOCK-IN PROVISIONS. (a) Change in Reporting Deadline.--Section 1854(a)(1) of the Social Security Act (42 U.S.C. 1395w-24(a)(1)) is amended by striking ``July 1'' and inserting ``the third Monday in September''. (b) Delay in Annual, Coordinated Election Period.--Section 1851(e)(3)(B) of such Act (42 U.S.C. 1395w-21(e)(3)(B)) is amended by striking ``(beginning with 2000), the month of November before such year'' and inserting ``, the period beginning on November 15 and ending on December 31 of the year before such year''. (c) 1-Year Delay in Lock-In.--Section 1851(e) of such Act (42 U.S.C. 1395w-21(e)) is amended-- (1) in paragraph (2)(A)-- (A) by striking ``and 2001,'' and inserting ``, 2001, and 2002''; and (B) in the heading, by striking ``2001'' and inserting ``2002''; (2) in paragraph (2)(B)-- (A) in clause (i), by striking ``2002'' each place it appears and inserting ``2003''; and (B) in the heading that precedes clause (i), by striking ``2002'' and inserting ``2003''; (3) in paragraph (2)(C)(i), by striking ``2002'' each place it appears and inserting ``2003''; and (4) in paragraph (4)-- (A) in the matter preceding subparagraph (A), by striking ``2002'' and inserting ``2003''; and (B) in the second sentence, by striking ``2002'' and inserting ``2003''. (d) Effective Date.--The amendments made by this section shall take effect on January 1, 2002. SEC. 4. AVOIDING DUPLICATIVE STATE REGULATION. (a) In General.--Section 1856(b)(3) of the Social Security Act (42 U.S.C. 1395w-26(b)(3)) is amended to read as follows: ``(3) Relation to state laws.--The standards established under this subsection shall supersede any State law or regulation (other than State licensing laws or State laws relating to plan solvency) with respect to Medicare+Choice plans which are offered by Medicare+Choice organizations under this part.''. (b) Effective Date.--The amendment made by subsection (a) shall take effect on the date of the enactment of this Act. SEC. 5. DEMONSTRATION PROJECTS FOR PREFERRED PROVIDER ORGANIZATIONS, POINT-OF-SERVICE PLANS, MSA PLANS, AND DISEASE MANAGEMENT PROGRAMS. (a) In General.--The Secretary of Health and Human Services shall conduct a demonstration program (in this section referred to as the ``demonstration program'') under which payment rules to Medicare+Choice organizations under section 1853 of the Social Security Act are modified in order to promote the offering of Medicare+Choice plans by preferred provider organizations under the Medicare+Choice program, the offering of Medicare+Choice plans that provide point-of-service coverage for other than participating providers, and the offering of MSA plans and to promote the use of disease management programs by Medicare+Choice plans. (b) Projects.--Under the demonstration program, the Secretary shall provide for 10 demonstration projects. Each project shall extend over a period of not to exceed 3 years. Of the demonstration projects conducted under the demonstration, to the extent feasible, at least one such project shall promote the offering of a Medicare+Choice plan by a preferred provider organization, at least one project shall promote the offering of a Medicare+Choice plan that provides point-of-service coverage for other than participating providers, and at least two projects shall promote the offering of a MSA plan. (c) Risk-Sharing Arrangements.--Under the demonstration program, the Secretary may provide for the assumption of portions of the financial risk under a split or partial risk-sharing arrangement. (d) Waiver Authority.--The Secretary is authorized to waive such provisions of section 1853 of the Social Security Act (and related provisions of part C of title XVIII of such Act) as the Secretary determines to be necessary to conduct the demonstration program under this section. (e) Evaluation and Report.-- (1) Evaluation.--The Secretary shall provide for an evaluation of the demonstration program conducted under this section and its impact on enrollment, particularly in areas not previously served by Medicare+Choice plans. (2) Report.--The Secretary shall submit to Congress a report on the demonstration program and its evaluation. Such report shall include an assessment of the costs and savings to the medicare program as a result of the demonstration program and may include such recommendations for changes in the Medicare+Choice program as the Secretary deems appropriate. SEC. 6. SUSPENSION OF LIMITATION FOR PROGRAM REENTRY FOR 2003 AND 2004. Section 1857(c)(4) of the Social Security Act (42 U.S.C. 1395w- 27(c)(4)) is amended-- (1) in subparagraph (A), by striking ``subparagraph (B)'' and inserting ``subparagraphs (B) and (C)''; and (2) by adding at the end the following new subparagraph: ``(C) Applicability in certain years.--Subparagraph (A) shall not apply for contracts entered into for contract year 2003 or 2004.''. SEC. 7. SPECIALIZED MEDICARE+CHOICE PLANS FOR SPECIAL NEEDS BENEFICIARIES. (a) Treatment as Coordinated Care Plan.--Section 1851(a)(2)(A) of the Social Security Act (42 U.S.C. 1395w-21(a)(2)(A)) is amended by adding at the end the following new sentence: ``Specialized Medicare+Choice plans for special needs beneficiaries (as defined in section 1859(b)(4)) may be any type of coordinated care plan.''. (b) Specialized Medicare+Choice Plan for Special Needs Beneficiaries Defined.--Section 1859(b) of such Act (42 U.S.C. 1395w- 29(b)) is amended by adding at the end the following new paragraph: ``(4) Specialized medicare+choice plans for special needs beneficiaries.-- ``(A) In general.--The term `specialized Medicare+Choice plan for special needs beneficiaries' means a Medicare+Choice plan that exclusively serves special needs beneficiaries (as defined in subparagraph (B)). ``(B) Special needs beneficiary.--The term `special needs beneficiary' means a Medicare+Choice eligible individual who-- ``(i) is institutionalized (as defined by the Secretary); ``(ii) is entitled to medical assistance under a State plan under title XIX; or ``(iii) meets such requirements as the Secretary may determine would benefit from enrollment in such a specialized Medicare+Choice plan described in subparagraph (A) for individuals with severe or disabling chronic conditions.''. (c) Restriction on Enrollment Permitted.--Section 1859 of such Act (42 U.S.C. 1395w-29) is amended by adding at the end the following new subsection: ``(f) Restriction on Enrollment for Specialized Medicare+Choice Plans for Special Needs Beneficiaries.--In the case of a specialized Medicare+Choice plan (as defined in subsection (b)(4)), notwithstanding any other provision of this part and in accordance with regulations of the Secretary and for periods before January 1, 2007, the plan may restrict the enrollment of individuals under the plan to individuals who are within one or more classes of special needs beneficiaries.''. (d) Report to Congress.--Not later than December 31, 2005, the Secretary of Health and Human Services shall submit to Congress a report that assesses the impact of specialized Medicare+Choice plans for special needs beneficiaries on the cost and quality of services provided to enrollees. Such report shall include an assessment of the costs and savings to the medicare program as a result of amendments made by subsections (a), (b), and (c). (e) Effective Dates.-- (1) In general.--The amendments made by subsections (a), (b), and (c) shall take effect upon the date of the enactment of this Act. (2) Deadline for issuance of requirements for special needs beneficiaries; transition.--No later than September 1, 2002, the Secretary of Health and Human Services shall issue final regulations to establish requirements for special needs beneficiaries under section 1859(b)(4)(B)(iii) of the Social Security Act, as added by subsection (b). (f) Extension of Municipal Health Service Demonstration Projects.-- The last sentence of section 9215(a) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (42 U.S.C. 1395b-1 note), as previously amended, is amended by striking ``December 31, 2004, but only with respect to'' and all that follows and inserting ``December 31, 2009, but only with respect to individuals who reside in the city in which the project is operated and so long as the total number of individuals participating in the project does not exceed the number of such individuals participating as of January 1, 1996.''.
summary: Medicare+Choice Improvement and Stabilization Act of 2001 - Amends part C (Medicare+Choice) of title XVIII (Medicare) of the Social Security Act (SSA) to make each annual Medicare+Choice capitation rate for a Medicare+Choice payment area for a contract year equal to the largest of the amounts specified under current law or, for 2003, 100 percent of the fee-for-service costs for the Medicare+Choice payment area for services covered under Medicare parts A (Hospital Insurance) or B (Supplementary Medical Insurance) for individuals entitled to benefits under part A and enrolled under part B who are not enrolled in a Medicare+Choice plan under this part for the year.Revises the calculation of the national standardized annual Medicare+Choice capitation rate used in determining the input-price-adjusted annual national Medicare+Choice capitation rate for a Medicare+Choice payment area for calculation of annual Medicare+Choice capitation rates for 2003.Eliminates budget neutrality in such calculation for a year other than 2003. Modifies requirements for establishment of standards (other than solvency standards) for provider-sponsored organizations for Medicare+Choice organizations and plans in relation to State laws to avoid duplicative State regulation.Directs the Secretary of Health and Human Services to conduct a demonstration program under which payment rules for Medicare+Choice organizations are modified in order to promote: (1) the offering of Medicare+Choice plans by preferred provider organizations, of Medicare+Choice plans that provide point-of-sale coverage for other than participating providers, and of MSA plans: and (2) the use of disease management programs by Medicare+Choice plans.Amends SSA title XVII part C to: (1) suspend the limitation for program reentry for Medicare+Choice organizations for 2003 and 2004; and (2) set forth rules governing specialized Medicare+Choice plans for special needs beneficiaries.Amends the Consolidated Omnibus Budget Reconciliation Act of 1985 to provide for extension of municipal health service demonstration projects.