[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 18 Introduced in Senate (IS)]
109th CONGRESS
1st Session
S. 18
To amend title XVIII of the Social Security Act to make improvements to
the medicare program for beneficiaries.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 24, 2005
Mr. Dayton (for himself, Mr. Reid, Ms. Stabenow, Mrs. Feinstein, Mr.
Kennedy, Mr. Corzine, Mr. Schumer, Mrs. Murray, Ms. Mikulski, Mr.
Lautenberg, Mr. Akaka, Mr. Inouye, Mrs. Clinton, Mr. Levin, Mr. Kerry,
Mr. Leahy, Mr. Rockefeller, Mr. Dodd, Mr. Sarbanes, and Mr. Durbin)
introduced the following bill; which was read twice and referred to the
Committee on Finance
_______________________________________________________________________
A BILL
To amend title XVIII of the Social Security Act to make improvements to
the medicare program for beneficiaries.
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 ``Meeting Our
Responsibility to Medicare Beneficiaries Act of 2005''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--ELIMINATING SPECIAL INTEREST PREFERENCES
Sec. 101. Negotiating fair prices for medicare prescription drugs.
Sec. 102. Elimination of MA Regional Plan Stabilization Fund (Slush
Fund).
Sec. 103. Application of risk adjustment reflecting characteristics for
the entire medicare population in payments
to Medicare Advantage organizations.
TITLE II--IMPROVING THE MEDICARE PROGRAM FOR BENEFICIARIES
Sec. 201. Eliminating coverage gap.
Sec. 202. Requiring two prescription drug plans to avoid Federal
fallback.
Sec. 203. Waiver of part D late enrollment penalty for transition
period.
Sec. 204. Improving the transition of full-benefit dual eligible
individuals to coverage under the medicare
drug benefit.
Sec. 205. Part B premium reduction.
Sec. 206. Study and report on providing incentives to preserve retiree
coverage.
Sec. 207. Promoting transparency in employer subsidy payments.
TITLE I--ELIMINATING SPECIAL INTEREST PREFERENCES
SEC. 101. NEGOTIATING FAIR PRICES FOR MEDICARE PRESCRIPTION DRUGS.
(a) In General.--Section 1860D-11 of the Social Security Act (42
U.S.C. 1395w-111) is amended by striking subsection (i) (relating to
noninterference) and by inserting the following new subsection:
``(i) Authority To Negotiate Prices With Manufacturers.--
``(1) In general.--The Secretary shall have authority
similar to that of other Federal entities that purchase
prescription drugs in bulk to negotiate contracts with
manufacturers of covered part D drugs, consistent with the
requirements and in furtherance of the goals of providing
quality care and containing costs under this part.
``(2) Required use of authority.--
``(A) Fallback plans.--The Secretary shall exercise
the authority described in paragraph (1) with respect
to covered part D drugs offered under each fallback
prescription drug plan under subsection (g).
``(B) PDPs and ma-pd plans.--In order to ensure
that beneficiaries enrolled under prescription drug
plans and MA-PD plans and taxpayers are getting fair
and affordable prices for covered part D drugs that
reflect the bulk purchasing power of such enrollees,
the Secretary shall exercise the authority described in
paragraph (1) with respect to such drugs offered under
all such plans if the Secretary determines that the
negotiated prices available under such plans for such
drugs are not fair and affordable prices compared to
the prices obtained by other Federal government
programs for such drugs.''.
(b) Effective Date.--The amendment made by this section shall take
effect as if included in the enactment of section 101(a) of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(Public Law 108-173; 117 Stat. 2071).
SEC. 102. ELIMINATION OF MA REGIONAL PLAN STABILIZATION FUND (SLUSH
FUND).
(a) In General.--Subsection (e) of section 1858 of the Social
Security Act (42 U.S.C. 1395w-27a) is repealed.
(b) Conforming Amendment.--Section 1858(f)(1) of the Social
Security Act (42 U.S.C. 1395w-27a(f)(1)) is amended by striking
``subject to subsection (e),''.
(c) Effective Date.--The amendments made by this section shall take
effect as if included in the enactment of section 221(c) of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(Public Law 108-173; 117 Stat. 2181).
SEC. 103. APPLICATION OF RISK ADJUSTMENT REFLECTING CHARACTERISTICS FOR
THE ENTIRE MEDICARE POPULATION IN PAYMENTS TO MEDICARE
ADVANTAGE ORGANIZATIONS.
Effective January 1, 2006, in applying risk adjustment factors to
payments to organizations under section 1853 of the Social Security Act
(42 U.S.C. 1395w-23), the Secretary of Health and Human Services shall
ensure that payments to such organizations are adjusted based on such
factors to ensure that the health status of the enrollee is reflected
in such adjusted payments, including adjusting for the difference
between the health status of the enrollee and individuals enrolled
under the original medicare fee-for-service program under parts A and B
of title XVIII of such Act. Payments to such organizations must, in
aggregate, reflect such differences.
TITLE II--IMPROVING THE MEDICARE PROGRAM FOR BENEFICIARIES
SEC. 201. ELIMINATING COVERAGE GAP.
(a) In General.--Section 1860D-2(b)(4)(B) of the Social Security
Act (42 U.S.C. 1395w-102(b)(4)(B)) is amended to read as follows:
``(B) Annual out-of-pocket threshold.--For purposes
of this part, the `annual out-of-pocket threshold'
specified in this subparagraph for a year is equal to
the greater of--
``(i) $3,600; or
``(ii) the initial coverage limit for the
year specified in paragraph (3).''.
(b) Conforming Amendment.--Section 1860D-22(a)(3)(B)(ii) of the
Social Security Act (42 U.S.C. 1395w-132(b)(4)(B)(ii)) is amended by
striking ``and the annual out-of-pocket threshold, respectively, are
annually adjusted under paragraphs (1) and (4)(B) of section 1860D-
2(b)'' and inserting ``is annually adjusted under paragraph (1) of
section 1860D-2(b) (using the percentage increase specified in
paragraph (6) of such section)''.
(c) Effective Date.--The amendments made by this section shall take
effect as if included in the enactment of section 101(a) of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(Public Law 108-173; 117 Stat. 2071).
SEC. 202. REQUIRING TWO PRESCRIPTION DRUG PLANS TO AVOID FEDERAL
FALLBACK.
(a) In General.--Section 1860D-3(a) of the Social Security Act (42
U.S.C. 1395w-103(a)) is amended--
(1) in paragraph (1)--
(A) by striking ``qualifying plans (as defined in
paragraph (3))'' and inserting ``prescription drug
plans''; and
(B) by striking ``, at least one of which is a
prescription drug plan'';
(2) in paragraph (2), by striking ``qualifying plans'' and
inserting ``prescription drug plans''; and
(3) by striking paragraph (3).
(b) Effective Date.--The amendments made by this section shall take
effect as if included in the enactment of section 101(a) of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(Public Law 108-173; 117 Stat. 2071).
SEC. 203. WAIVER OF PART D LATE ENROLLMENT PENALTY FOR TRANSITION
PERIOD.
(a) In General.--Section 1860D-13(b) of the Social Security Act (42
U.S.C. 1895w-113(b)) is amended by adding at the end the following new
paragraph:
``(8) Waiver of penalty for months prior to 2008.--A part D
eligible individual who enrolls for the first time in a
prescription drug plan or an MA-PD plan under this part prior
to January 1, 2008, shall not be subject an increase in the
monthly beneficiary premium established under subsection (a)
with respect to months occurring prior to such date.''.
(b) Effective Date.--The amendment made by this section shall take
effect as if included in the enactment of section 101(a) of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(117 Stat. 2071).
SEC. 204. IMPROVING THE TRANSITION OF FULL-BENEFIT DUAL ELIGIBLE
INDIVIDUALS TO COVERAGE UNDER THE MEDICARE DRUG BENEFIT.
(a) In General.--Notwithstanding subsection (d)(1) of section 1935
of the Social Security Act (42 U.S.C. 1396u-5), beginning on January 1,
2006, the Secretary of Health and Human Services shall administer a 12-
month period during which full-benefit dual eligible individuals (as
defined in section 1935(c)(6) of the Social Security Act) shall
gradually transition from receiving medical assistance for prescribed
drugs under the medicaid program under title XIX of such Act to
obtaining coverage of covered part D drugs (as defined in section
1860D-2(e) (42 U.S.C. 1395w-102(e)) under title XVIII of such Act in
order to assure that such individuals continue to receive the
outpatient prescription drugs they need.
(b) Adjustments to Phased-Down State Contribution.--The Secretary
of Health and Human Services shall make appropriate adjustments to the
amount of payments required to be made by a State or the District of
Columbia under section 1935(c) of the Social Security Act (42 U.S.C.
1396u-5(c)) for months occurring during the period described in
subsection (a) in order to account for increased costs for the
provision of medical assistance incurred by the State or the District
of Columbia by reason of the application of the transition period
required under this section.
SEC. 205. PART B PREMIUM REDUCTION.
Section 1839(a) of the Social Security Act (42 U.S.C. 1395r(a)) is
amended--
(1) in paragraph (3), in the first sentence, by striking
``The Secretary'' and inserting ``Subject to paragraph (5), the
Secretary''; and
(2) by adding at the end the following new paragraph:
``(5) For each year (beginning with 2006), the Secretary shall
reduce the monthly premium rate determined under paragraph (3) for each
month in the year for each individual enrolled under this part
(including such an individual subject to an increased premium under
subsection (b) or (i)) so that the aggregate amount of such reductions
in the year is equal to the aggregate amount of reduced expenditures
from the Federal Supplementary Medicare Insurance Trust Fund in the
year that the Secretary estimates will result from the provisions of
section 103 of the Meeting Our Responsibility to Medicare Beneficiaries
Act of 2005.''.
SEC. 206. STUDY AND REPORT ON PROVIDING INCENTIVES TO PRESERVE RETIREE
COVERAGE.
(a) Study.--The Secretary of Health and Human Services shall
conduct a study to determine what additional incentives should be
provided to employers in order for such employers to continue to
provide retirees with prescription drug coverage. Such study shall
include an assessment of permitting costs incurred by an employer for
covered part D drugs on behalf of a retiree to be treated as incurred
costs for purposes of reaching the annual out-of-pocket threshold under
section 1860D-2(b)(4) of the Social Security Act (42 U.S.C. 1395w-
102(b)(4)).
(b) Report.--Not later than January 1, 2006, the Secretary of
Health and Human Services shall submit to Congress a report on the
study under subsection (a) together with such recommendations for
legislation as the Secretary deems appropriate.
SEC. 207. PROMOTING TRANSPARENCY IN EMPLOYER SUBSIDY PAYMENTS.
(a) In General.--Section 1860D-22(a) of the Social Security Act (42
U.S.C. 1895w-132(a)) is amended by adding at the end the following new
paragraph:
``(7) Disclosure of certain information.--The Secretary
shall make the following information regarding the sponsor of a
qualified prescription drug plan receiving a subsidy under this
section available to the public through the Internet website of
the Centers for Medicare & Medicaid Services and other
appropriate means:
``(A) The information used by the Secretary to
ensure that the prescription drug coverage offered
under the plan meets the requirements for subsidy
payments under this section.
``(B) The total amount of the subsidy payments made
to the sponsor under this section.''.
(b) Effective Date.--The amendment made by this section shall take
effect as if included in the enactment of section 101(a) of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(Public Law 108-173; 117 Stat. 2071).
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