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HR 3025 IH
To amend title XVIII of the Social Security Act to provide comprehensive improvements to the Medicare Prescription Drug Program, and for other purposes.
July 12, 2007
Mr. DOGGETT (for himself, Mr. ACKERMAN, Mr. ALLEN, Mr. BECERRA, Mr. BERMAN, Mrs. CAPPS, Mr. COHEN, Mr. DAVIS of Illinois, Ms. DELAURO, Ms. EDDIE BERNICE JOHNSON of Texas, Mr. ELLISON, Mr. EMANUEL, Mr. ENGEL, Mr. FRANK of Massachusetts, Mr. AL GREEN of Texas, Mr. GRIJALVA, Mr. GUTIERREZ, Mr. HINCHEY, Ms. JACKSON-LEE of Texas, Ms. KAPTUR, Mr. KENNEDY, Mr. LARSON of Connecticut, Mr. LEWIS of Georgia, Mrs. LOWEY, Mrs. MALONEY of New York, Ms. MATSUI, Ms. MCCOLLUM of Minnesota, Mr. MCDERMOTT, Mr. MCGOVERN, Mr. MCNULTY, Mr. MICHAUD, Ms. MOORE of Wisconsin, Mr. MORAN of Virginia, Mr. NADLER, Mr. NEAL of Massachusetts, Ms. NORTON, Mr. ORTIZ, Mr. RUPPERSBERGER, Ms. SCHAKOWSKY, Mr. SCOTT of Virginia, Mr. STARK, Mr. WEINER, and Mr. WYNN) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned
To amend title XVIII of the Social Security Act to provide comprehensive improvements to the Medicare Prescription Drug Program, and for other purposes.
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 Savings for Our Seniors (Medicare Prescription Drug SOS) Act of 2007'.
(b) Table of Contents- The table of contents of this Act is as follows:
Sec. 1. Short title; table of contents.
TITLE I--MEDICARE OPERATED PRESCRIPTION DRUG PLAN OPTION
Sec. 101. Establishment of Medicare operated prescription drug plan option.
TITLE II--MEDICAID AND LOW-INCOME IMPROVEMENTS
Sec. 201. Change in base used in computing State clawback provision.
Sec. 202. Elimination of part D cost-sharing for certain non-institutionalized full-benefit dual eligible individuals.
Sec. 203. Expediting low-income subsidies under the Medicare Prescription Drug Program.
Sec. 204. Modification of resource standards for determination of eligibility for low-income subsidy; simplification of income and asset rules.
Sec. 205. Indexing deductible and cost-sharing above annual out-of-pocket threshold for individuals with income below 150 percent of poverty line.
Sec. 206. No impact on eligibility for benefits under other programs.
Sec. 207. Screening by Commissioner of Social Security for eligibility under Medicare savings programs.
Sec. 208. Special enrollment period for subsidy eligible individuals.
Sec. 209. Waiver of late enrollment penalty for subsidy eligible individuals.
TITLE III--FRAUD AND ABUSE PROVISIONS
Sec. 301. Criminal penalty for fraud in connection with enrollment under an MA plan or prescription drug plan.
Sec. 302. Recourse for slamming practices.
Sec. 303. Protection from loss of employment-based retiree health coverage upon enrollment for Medicare prescription drug benefit during 2007.
Sec. 304. Required application of intermediate sanctions to protect against fraud and abuse.
Sec. 305. Repeal of special waiver authority for State licensure.
TITLE IV--RELATION TO SOCIAL SECURITY BENEFITS
Sec. 401. Protection of Social Security benefits against decrease due to part D Medicare premium increases.
TITLE V--BENEFICIARY PROTECTION PROVISIONS
Sec. 501. Suspension of late enrollment penalties; allowing one-time change in plan during first year of enrollment.
Sec. 502. Counting expenditures under State drug assistance programs against true out-of-pocket costs.
Sec. 503. Price disclosure.
Sec. 504. Removal of covered part D drugs from the prescription drug plan formulary.
Sec. 505. Special treatment under Medicare part D for drugs in 6 specified therapeutic categories.
Sec. 506. Removal of exclusion of benzodiazepines from required coverage under the Medicare Prescription Drug Program.
Sec. 507. Standardized forms and procedures for reconsiderations and appeals.
Sec. 508. Elimination of MA Regional Stabilization Fund (Slush Fund); elimination of certain MA overpayments.
Sec. 509. Beneficiary complaints.
Sec. 510. Fill of drugs for dual eligibles.
TITLE W--FAIR AND SPEEDY TREATMENT OF MEDICARE PRESCRIPTION DRUG CLAIMS
Sec. 601. Prompt payment by Medicare prescription drug plans and MA-PD plans under part D.
Sec. 602. Restriction on co-branding.
Sec. 603. Provision of medication therapy management services under part D.
TITLE I--MEDICARE OPERATED PRESCRIPTION DRUG PLAN OPTION
SEC. 101. ESTABLISHMENT OF MEDICARE OPERATED PRESCRIPTION DRUG PLAN OPTION.
(a) In General- Subpart 2 of part D of the Social Security Act is amended by inserting after section 1860D-11 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 2008), 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 (c)) with a service area that consists of the entire United States and shall enter into negotiations with pharmaceutical manufacturers to reduce the purchase cost of covered part D drugs for eligible part D individuals in accordance with subsection (b).
`(b) Negotiations-
`(1) IN GENERAL- Notwithstanding section 1860D-11(i), for purposes of offering a Medicare operated prescription drug plan under this section, the Secretary shall negotiate with pharmaceutical manufacturers with respect to the purchase price (including discounts, rebates, and other price concessions) that of covered part D drugs and shall encourage the use of more affordable therapeutic equivalents to the extent such practices do not override medical necessity as determined by the prescribing physician. To the extent practicable and consistent with the previous sentence, the Secretary shall implement strategies similar to those used by other Federal purchasers of prescription drugs, and other strategies, to reduce the purchase cost of covered part D drugs.
`(2) PERMITTING APPLICATION OF SOME OR ALL OF SAVINGS TO REDUCTION IN COVERAGE GAP- Notwithstanding any other provision of this part, the Secretary may increase the initial coverage limit under section 1860D-2(b)(3) for a year, but only with respect to the Medicare operated prescription drug plan, by an amount not to exceed the actuarial value of the reductions in expenditures during such year resulting from the application of paragraph (1).
`(c) 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). Such a plan may offer supplemental prescription drug coverage in the same manner as other qualified prescription drug coverage offered by other prescription drug plans.
`(d) 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 a year shall be based on the average monthly per capita actuarial cost of offering the Medicare operated prescription drug plan for the year involved, including administrative expenses, as determined by the Secretary and as certified by the chief actuary of the Centers for Medicare & Medicaid Services.
`(2) SUPPLEMENTAL PRESCRIPTION DRUG COVERAGE- Insofar as a Medicare operated prescription drug plan offers supplemental prescription drug coverage, the Secretary may adjust the amount of the premium charged under paragraph (1).'.
(b) Auto-Enrollment of Subsidy Eligible Individuals in Medicare Operated Prescription Drug Plan- Section 1860D-1(b)(1)(C) of such Act (
(1) by designating the matter beginning with `The process established' as a clause (i) with the heading `AUTO-ENROLLMENT FOR DUAL ELIGIBLES AND OTHER SUBSIDY ELIGIBLE INDIVIDUALS';
(2) by inserting `or who is a subsidy eligible individual' after `section 1935(c)(6))';
(3) by striking `for the enrollment in' and all that follows through `in the PDP region.' and inserting `for the enrollment in the Medicare operated prescription drug plan (as defined in section 1860D-11A(c)).'; and
(4) by adding at the end the following new clauses:
`(ii) APPLICATION IN CASE OF PREMIUM INCREASES OR PLAN DISCONTINUATION- The process under subparagraph (A) shall also provide for enrollment described in clause (i) in the case of such an individual who is enrolled in a prescription drug plan that has a monthly beneficiary premium that does not exceed the premium assistance available under section 1860D-14(a)(1)(A)) if such plan is discontinued or the premium under such plan is increased so it exceeds such available premium assistance.
`(iii) NOTICE-
`(I) IN GENERAL- The Secretary shall provide for notice to each individual auto-enrolled under clause (i) or (ii) that the individual has the right and the opportunity to select another prescription drug plan (or MA-PD plan) through which to obtain prescription drug coverage.
`(II) ADDITIONAL NOTICE- In the case of an individual described in clause (ii), both the sponsor of the plan in which the individual is enrolled and the Secretary shall provide notice to the individual that enrollment in the plan will be discontinued or have a premium above the benchmark and, as a result, the individual will be enrolled in the Medicare operated prescription drug plan for the following year unless the individual affirmatively acts otherwise.'.
(c) Application of Monthly Premium for Premium Subsidy Purposes- Section 1860D-14(b)(1) of such Act (
(d) Conforming Amendments, Including Elimination of Unnecessary Plan Requirement and Fallback Plan Provisions-
(1) Section 1860D-3 of such Act (
(2) Section 1860D-11 of such Act (
(A) by striking subsection (f), (g), and (h); and
(B) in subsection (i), by inserting `except as provided in section 1860D-11A(b),' after `in carrying out this part,'.
(3) Section 1860D-12(b) of such Act (
(4) Section 1860D-13(c) of such Act (
(5) Section 1860D-15 of such Act (
(6) Section 1860D-16(b)(1) of such Act (
`(B) payments for expenses incurred with respect to the operation of Medicare operated prescription drug plans under section 1860D-11A.'.
(7) Section 1860D-41(a) of such Act (
`(5) MEDICARE OPERATED PRESCRIPTION DRUG PLAN- The term `Medicare operated prescription drug plan' has the meaning given such term in section 1860D-11A(c).'.
(8) Section 1860D-42(a) of such Act (
(e) Effective Date- The amendments made by this section shall take effect on the date of the enactment of this Act and shall apply to enrollments effective for periods occurring on or after January 1, 2008.
TITLE II--MEDICAID AND LOW-INCOME IMPROVEMENTS
SEC. 201. CHANGE IN BASE USED IN COMPUTING STATE CLAWBACK PROVISION.
(a) In General- Section 1935(c) of the Social Security Act (
(1) in paragraph (2)(A)(ii), by inserting `, subject to paragraph (7),' after `increased for each year (';
(2) in paragraph (3), by inserting `Subject to paragraph (7)--' after `DUAL ELIGIBLE INDIVIDUALS- ' in the matter before subparagraph (A); and
(3) by adding at the end the following new paragraph:
`(7) USE OF 2005 AS BASE- This subsection shall be applied by substituting `2005' for `2003' each place it appears in paragraph (3) if such substitution results in a reduced amount under paragraph (1)(A) of this subsection and, in the case of such substitution, the reference in paragraph (2)(A)(ii) to `2004' is deemed a reference to `2006.'.
(b) Effective Date- The amendment made by subsection (a) shall apply to payments for calendar quarters beginning on or after January 1, 2008.
SEC. 202. 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 (
(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 a resident of a facility described in subclause (III) or who is receiving home and community-based services in a home setting provided under a home and community-based waiver approved for the State under section 1915 or 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)).
`(III) FACILITY DESCRIBED- For purposes of subclause (II), a facility described in this subclause is an assisted living facility or a resident care program facility (as such terms are defined by the Secretary), a board and care facility (as defined in section 1903(q)(4)(B)), or any other facility that is licensed or certified by the State involved and is determined appropriate by the Secretary, such as a community mental health center that meets the requirements of section 1913(c) of the Public Health Service Act, a psychiatric health facility, a mental health rehabilitation center, and a mental retardation developmental disability facility.'.
(b) Effective Date- The amendments made by subsection (a) shall apply to drugs dispensed on or after the date of the enactment of this Act.
SEC. 203. EXPEDITING LOW-INCOME SUBSIDIES UNDER THE MEDICARE PRESCRIPTION DRUG PROGRAM.
(a) In General- Section 1860D-14 of the Social Security Act (
`(e) Expedited Application and Eligibility Process-
`(1) EXPEDITED PROCESS-
`(A) IN GENERAL- The Secretary shall provide for an expedited process under this subsection for the qualification for low-income assistance under this section through a request to the Secretary of the Treasury as provided in subparagraphs (B) and (C) for information sufficient to identify whether the individual involved is likely eligible for subsidies under this section based on such information and the amount of premium and cost-sharing subsidies for which they would qualify based on such information. Such process shall be conducted in cooperation with the Commissioner of Social Security.
`(B) OPT IN FOR NEWLY ELIGIBLE INDIVIDUALS- Not later than 60 days after the date of the enactment of this subsection, the Secretary shall ensure that, as part of the Medicare enrollment process, enrolling individuals--
`(i) receive information describing the low-income subsidy provided under this section; and
`(ii) are provided the opportunity to opt-in to the expedited process described in this subsection by requesting that the Commissioner of Social Security screen the individual involved for eligibility for such subsidy through a request to the Secretary of the Treasury under section 6103(l)(21) of the Internal Revenue Code of 1986.
`(C) TRANSITION FOR CURRENTLY ELIGIBLE INDIVIDUALS- In the case of any part D eligible individual to which subparagraph (B) did not apply at the time of such individual's enrollment, the Secretary shall, not later than 60 days after the date of the implementation of subparagraph (B), request that the Commissioner of Social Security screen such individual for eligibility for the low-income subsidy provided under this section through a request to the Secretary of the Treasury under section 6103(l)(21) of the Internal Revenue Code of 1986.
`(2) NOTIFICATION OF POTENTIALLY ELIGIBLE INDIVIDUALS- Under such process, in the case of each individual identified under paragraph (1) who has not otherwise applied for, or been determined eligible for, benefits under this section (or who has applied for and been determined ineligible for such benefits based only on excess resources), the Secretary shall send them a letter (using basic, uncomplicated language) containing the following:
`(A) ELIGIBILITY- A statement that, based on the information obtained under paragraph (1), the individual is likely eligible for low-income subsidies under this section.
`(B) AMOUNT OF SUBSIDIES- A description of the amount of premium and cost-sharing subsidies under this section for which the individual would likely be eligible based on such information.
`(C) ENROLLMENT OPPORTUNITY- In case the individual is not enrolled in a prescription drug plan or MA-PD plan--
`(i) a statement that--
`(I) the individual has the opportunity to enroll in a prescription drug plan or MA-PD plan for benefits under this part, but is not required to be so enrolled; and
`(II) if the individual has creditable prescription drug coverage, the individual need not so enroll;
`(ii) a list of the prescription drug plans and MA-PD plans in which the individual is eligible to enroll;
`(iii) an enrollment form that may be used to enroll in such a plan by mail and that provides that if the individual wishes to enroll but does not designate a plan, the Secretary is authorized to enroll the individual in such a prescription drug plan selected by the Secretary; and
`(iv) a statement that the individual may also enroll online or by telephone, but, in order to qualify for low-income subsidies, the individual must complete the attestation described in subparagraph (D) or otherwise apply for such subsidies.
`(D) ATTESTATION- A one-page application form that provides for a signed attestation, under penalty of law, as to the amount of income and assets of the individual and constitutes an application for the low-income subsidies described in subparagraph (B). Such form--
`(i) shall not require the submittal of additional documentation regarding income or assets;
`(ii) shall permit the appointment of a personal representative described in paragraph (5); and
`(iii) shall allow for the specification of a language (other than English) that is preferred by the individual for subsequent communications with respect to the individual under this part.
`(E) INFORMATION ON SHIP- Information on how the individual may contact the State Health Insurance Assistance Program (SHIP) for the State in which the individual is located in order to obtain assistance regarding enrollment and benefits under this part.
If a State is doing its own outreach to low-income seniors regarding enrollment and low-income subsidies under this part, such process shall be coordinated with the State's outreach effort.
`(3) FOLLOW-UP COMMUNICATIONS- If the individual does not respond to the letter described in paragraph (2) either by making an enrollment described in paragraph (2)(C), completing an attestation described in paragraph (2)(D), or declining either or both, the Secretary shall make additional attempts to contact the individual to obtain such an affirmative response.
`(4) HOLD-HARMLESS- Under such process, if an individual in good faith and in the absence of fraud executes an attestation described in paragraph (2)(D) and is provided low-income subsidies under this section on the basis of such attestation, if the individual is subsequently found not eligible for such subsidies, there shall be no recovery made against the individual because of such subsidies improperly paid.
`(5) USE OF AUTHORIZED REPRESENTATIVE- Under such process, with proper authorization (which may be part of the attestation form described in paragraph (2)(D)), an individual may authorize another individual to act as the individual's personal representative with respect to communications under this part and the enrollment of the individual under a prescription drug plan (or MA-PD plan) and for low-income subsidies under this section.
`(6) USE OF PREFERRED LANGUAGE IN SUBSEQUENT COMMUNICATIONS- In the case an attestation described in paragraph (2)(D) is completed and in which a language other than English is specified under clause (iii) of such paragraph, the Secretary shall provide that subsequent communications to the individual under this part shall be in such language.
`(7) CONSTRUCTION- Nothing in this subsection shall be construed as precluding the Secretary from taking additional outreach efforts to enroll eligible individuals under this part and to provide low-income subsidies to eligible individuals.'.
(b) Prescription Drug Plans Required To Provide Expedited Low-Income Subsidy Opt-In as Part of Applications-
(1) IN GENERAL- Section 1860D-1(b)(1)(B)(vi) of such Act (
(2) EFFECTIVE DATE- The amendment made by paragraph (1) shall apply to application forms for plan years beginning with 2008.
(c) Disclosure of Return Information for Purposes of Screening Individuals for Eligibility for Low-Income Subsidies Under Medicare-
(1) IN GENERAL- Subsection (l) of section 6103 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:
`(21) DISCLOSURE OF RETURN INFORMATION FOR PURPOSES OF PROVIDING LOW-INCOME SUBSIDIES UNDER MEDICARE-
`(A) RETURN INFORMATION FROM INTERNAL REVENUE SERVICE TO SOCIAL SECURITY ADMINISTRATION- The Secretary, upon written request from the Commissioner of Social Security under section 1860D-14(e)(1) of the Social Security Act, shall disclose to the Commissioner with respect to any taxpayer identified by the Commissioner--
`(i)(I) whether the adjusted gross income, as modified in accordance with specifications of the Secretary of Health and Human Services for purposes of carrying out such section, of such taxpayer and, if applicable, such taxpayer's spouse, for the applicable year, exceeds the amounts specified by the Secretary of Health and Human Services in order to apply the 135 and 150 percent poverty lines under such section,
`(II) the adjusted gross income (as determined under subclause (I)), in the case of a taxpayer with respect to which such adjusted gross income exceeds the amount so specified for applying the 135 percent poverty line and does not exceed the amount so specified for applying the 150 percent poverty line,
`(III) whether the return was a joint return for the applicable year, and
`(IV) the applicable year, or
`(ii) if applicable, the fact that there is no return filed for such taxpayer for the applicable year.
`(B) DEFINITION OF APPLICABLE YEAR- For the purposes of this paragraph, the term `applicable year' means the most recent taxable year for which information is available in the Internal Revenue Service's taxpayer data information systems, or, if there is no return filed for such taxpayer for such year, the prior taxable year.
`(C) RESTRICTION ON INDIVIDUALS FOR WHOM DISCLOSURE IS REQUESTED- The Commissioner of Social Security shall only request information under this paragraph with respect to individuals who are described in subparagraph (C) of section 1860D-14(e)(1) of the Social Security Act or who have requested that such request be made under subparagraph (B) of such section.
`(D) RETURN INFORMATION FROM SOCIAL SECURITY ADMINISTRATION TO DEPARTMENT OF HEALTH AND HUMAN SERVICES- The Commissioner of Social Security shall, upon written request from the Secretary of Health and Human Services, disclose to the Secretary of Health and Human Services the information described in clauses (i) and (ii) of subparagraph (A).
`(E) PERMISSIVE DISCLOSURE TO OFFICERS, EMPLOYEES, AND CONTRACTORS- The information described in clauses (i) and (ii) of subparagraph (A) may be disclosed among officers, employees, and contractors of the Social Security Administration and the Department of Health and Human Services for the purposes described in subparagraph (F).
`(F) RESTRICTION ON USE OF DISCLOSED INFORMATION- Return information disclosed under this paragraph may be used only for the purposes of identifying eligible individuals for, and administering--
`(i) low-income subsidies under section 1860D-14 of the Social Security Act, and
`(ii) the Medicare Savings Program implemented under clauses (i), (iii), and (iv) of section 1902(a)(10)(E) of such Act.
`(G) TERMINATION OF DISCLOSURES FOR CERTAIN ELIGIBILITY DETERMINATIONS- With respect to individuals who are described in subparagraph (C) of section 1860D-14(e)(1) of the Social Security Act, return information may not be disclosed under this paragraph after the date that is one year after the date of the enactment of this paragraph.'.
(2) CONFIDENTIALITY- Paragraph (3) of section 6103(a) of such Code is amended by striking `or (20)' and inserting `(20), or (21)'.
(3) PROCEDURES AND RECORDKEEPING RELATED TO DISCLOSURES- Paragraph (4) of section 6103(p) of such Code is amended by striking `or (20)' each place it appears and inserting `(20), or (21)'.
(4) UNAUTHORIZED DISCLOSURE OR INSPECTION- Paragraph (2) of section 7213(a) of such Code is amended by striking `or (20)' and inserting `(20), or (21)'.
SEC. 204. MODIFICATION OF RESOURCE STANDARDS FOR DETERMINATION OF ELIGIBILITY FOR LOW-INCOME SUBSIDY; SIMPLIFICATION OF INCOME AND ASSET RULES.
(a) Increasing the Resource Standard Applied to Full Low-Income Subsidy- Subparagraph (D) of section 1860D-14(a)(3)(D) of the Social Security Act (
(1) in the heading, by striking `THREE TIMES';
(2) in clause (i), by striking `and' at the end;
(3) in clause (ii)--
(A) by striking `a subsequent year' and inserting `2007';
(B) by striking `this clause for the previous year' and inserting `clause (i) for 2006'; and
(C) by inserting `(or clause (i))' after `this clause'; and
(D) by striking the period at the end and inserting a semicolon;
(4) by adding at the end the following new clauses:
`(iii) for 2008, six times the maximum amount of resources that an individual may have and obtain benefits under such supplemental security income program; and
`(iv) for a subsequent year the resource limitation established under this clause (or clause (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
(5) in the last sentence, by inserting `or (iv)' after `clause (ii)'.
(b) Increasing the Alternate Resource Standard- Subparagraph (E)(i) of such section is amended--
(1) by striking `and' at the end of subclause (I);
(2) in subclause (II)--
(A) by striking `a subsequent year' and inserting `2007';
(B) by striking `in this subclause (or subclause (I)) for the previous year' and inserting `in subclause (I) for 2006'; and
(C) by striking the period at the end and inserting a semicolon;
(3) by inserting after subclause (II) the following new subclauses:
`(III) for 2008, $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
(4) in the last sentence, by inserting `or (IV)' after `subclause (II)'.
(c) Exemptions From Resources- Such section is further amended--
(1) in subparagraphs (D) and (E), by inserting `, except as provided in subparagraph (G)' after `supplemental security income program'; and
(2) by adding at the end the following new subparagraph:
`(G) ADDITIONAL EXCLUSIONS- In determining the resources of an individual (and their eligible spouse, if any) under section 1613 for purposes of subparagraphs (D) and (E), the following additional exclusions shall apply for months beginning after the date of the enactment of this subparagraph:
`(i) LIFE INSURANCE POLICY- No part of the value of any life insurance policy shall be taken into account.
`(ii) PENSION OR RETIREMENT PLAN- No balance in any pension or retirement plan shall be taken into account.'.
(d) Not Counting In-Kind Support and Maintenance as Income- Such section is further amended in subparagraph (C)(i), by inserting `and except that support and maintenance furnished in kind shall not be counted as income for months beginning after the date of the enactment of the Prescription Coverage Now Act of 2007' after `section 1902(r)(2)'.
SEC. 205. INDEXING DEDUCTIBLE AND COST-SHARING ABOVE ANNUAL OUT-OF-POCKET THRESHOLD FOR INDIVIDUALS WITH INCOME BELOW 150 PERCENT OF POVERTY LINE.
(a) Indexing Deductible- Section 1860D-14(a)(4)(B) of the Social Security Act (
(1) in clause (i), by striking `or';
(2) in clause (ii)--
(A) by striking `a subsequent year' and inserting `2008';
(B) by striking `this clause (or clause (i)) for the previous year' and inserting `clause (i) for 2007'; and
(C) by striking the period at the end and inserting `; and';
(3) by adding after clause (ii) the following new clause:
`(iii) for 2009 and each succeeding year, the amount determined under this subparagraph 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
(4) in the last sentence, by striking `clause (i) or (ii)' and inserting `clause (i), (ii), or (iii)'.
(b) Indexing Cost-Sharing- Section 1860D-14(a) of the Social Security Act (
(1) in paragraph (1)(D)(iii), by striking `exceed the copayment amount' and all that follows through the period at the end and inserting `exceed--
`(I) for 2006 and 2007, the copayment amount specified under section 1860D-2(b)(4)(A)(i)(I) for the drug and year involved; and
`(II) for 2008 and each succeeding year, the amount determined under this subparagraph 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
(2) in paragraph (2)(E), by striking `exceed the copayment or coinsurance amount' and all that follows through the period at the end and inserting `exceed--
`(i) for 2006 and 2007, the copayment or coinsurance amount specified under section 1860D-2(b)(4)(A)(i)(I) for the drug and year involved; and
`(ii) for 2008 and each succeeding year, the amount determined under this clause 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.'.
SEC. 206. NO IMPACT ON ELIGIBILITY FOR BENEFITS UNDER OTHER PROGRAMS.
(a) In General- Section 1860D-14(a)(3) of the Social Security Act (
(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 subsection (a) shall apply to premium and cost-sharing subsidies for months beginning after the date of the enactment of this Act.
SEC. 207. SCREENING BY COMMISSIONER OF SOCIAL SECURITY FOR ELIGIBILITY UNDER MEDICARE SAVINGS PROGRAMS.
(a) In General- Section 1860D-14(a)(3)(B)(i) of the Social Security Act (
(b) Effective Date- The amendment made by subsection (a) shall apply to determinations made for months beginning after the date of the enactment of this Act.
SEC. 208. SPECIAL ENROLLMENT PERIOD FOR SUBSIDY ELIGIBLE INDIVIDUALS.
(a) In General- Section 1860D-1(b)(3) of the Social Security Act (
`(F) ELIGIBILITY FOR LOW-INCOME SUBSIDY-
`(i) IN GENERAL- In the case of an applicable subsidy eligible individual (as defined in clause (ii)), the special enrollment period described in clause (iii).
`(ii) APPLICABLE SUBSIDY ELIGIBLE INDIVIDUAL DEFINED- For purposes of this subparagraph, the term `applicable subsidy eligible individual' means a part D eligible individual who is determined under subparagraph (B) of section 1860D-14(a)(3) to be a subsidy eligible individual (as defined in subparagraph (A) of such section), and includes such an individual who was enrolled in a prescription drug plan or an MA-PD plan on the date of such determination.
`(iii) SPECIAL ENROLLMENT PERIOD DESCRIBED- The special enrollment period described in this clause, with respect to an applicable subsidy eligible individual, is the 90-day period beginning on the date the individual receives notification that such individual has been determined under section 1860D-14(a)(3)(B) to be a subsidy eligible individual (as so defined).'.
(b) Automatic Enrollment Process for Certain Subsidy Eligible Individuals- Section 1860D-1(b)(1) is amended by adding at the end the following new subparagraph:
`(D) SPECIAL RULE FOR SUBSIDY ELIGIBLE INDIVIDUALS- The process established under subparagraph (A) shall include, in the case of an applicable subsidy eligible individual (as defined in clause (ii) of paragraph (3)(F)) who fails to enroll in a prescription drug plan or an MA-PD plan during the special enrollment period described in clause (iii) of such paragraph applicable to such individual, a process for the facilitated enrollment of the individual in the prescription drug plan or MA-PD plan that is most appropriate for such individual (as determined by the Secretary). Nothing in the previous sentence shall prevent an individual described in such sentence from declining enrollment in a plan determined appropriate by the Secretary (or in the program under this part) or from changing such enrollment.'.
(c) Effective Date- The amendments made by this section shall apply to subsidy determinations made for months beginning with January 2008.
SEC. 209. WAIVER OF LATE ENROLLMENT PENALTY FOR SUBSIDY ELIGIBLE INDIVIDUALS.
(a) In General- Section 1860D-13(b) of the Social Security Act (
`(8) WAIVER OF LATE ENROLLMENT PENALTY FOR SUBSIDY ELIGIBLE INDIVIDUALS- In the case of a subsidy eligible individual (as defined in paragraph (3)(A) of section 1860D-14(a)) who is determined to be entitled to a subsidy in accordance with paragraph (1) or (2) of such section, there shall not be an increase under paragraph (1) in the monthly premium of such individual for any month in which such individual is determined to be so entitled.'.
(b) Conforming Amendment- Section 1860D-14(a)(1)(A) of such Act (
(1) by striking `equal to--' and all that follows through `(i) 100 percent' and inserting `equal to 100 percent';
(2) by striking `; plus' and inserting a period; and
(3) by striking clause (ii).
(c) Effective Date- The amendments made by this section shall apply to premiums and subsidies for months beginning with January 2008. Nothing in this section shall be construed as affecting the waiver of any late enrollment penalties for subsidy eligible individuals that may have been effected by administrative action for months before such month.
TITLE III--FRAUD AND ABUSE PROVISIONS
SEC. 301. CRIMINAL PENALTY FOR FRAUD IN CONNECTION WITH ENROLLMENT UNDER AN MA PLAN OR PRESCRIPTION DRUG PLAN.
(a) In General- Section 1857 of the Social Security Act (
`(j) Criminal Penalty for Fraud in Connection With Enrollment Under an MA Plan or Prescription Drug Plan- Whoever knowingly and willfully--
`(1) defrauds an individual in connection with the enrollment (or nonenrollment) of the individual with a Medicare Advantage plan under this part or a prescription drug plan under part D; or
`(2) fraudulently or falsely represents an entity to be such a plan for purposes of inducing enrollment in such entity;
shall be fined under title 18, United States Code, or imprisoned not less than 3 years and not more than 10 years, or both.'.
(b) Conforming Reference in Part D- Section 1860D-12(b) of such Act (
`(4) REFERENCE TO PENALTY FOR FRAUD IN CONNECTION WITH ENROLLMENT UNDER A PRESCRIPTION DRUG PLAN- For provision imposing a criminal penalty for defrauding an individual in connection with the enrollment of such individual under a prescription drug plan, see section 1857(j).'.
(c) Effective Date- The amendment made by subsection (a) shall apply to fraudulent acts and to fraudulent or false representations made on or after the date of the enactment of this Act.
SEC. 302. RECOURSE FOR SLAMMING PRACTICES.
Section 1851 of the Social Security Act (
`(j) Sanctions Against Slamming Practices-
`(1) IN GENERAL- The Secretary shall establish procedures, consistent with this subsection and the complaint processes otherwise available, under which Medicare Advantage eligible individuals who have been enrolled into an MA-PD plan without their informed consent may file a complaint with the Secretary regarding such enrollment. Such a complaint shall be signed and shall attest, under penalty of perjury, as to the accuracy of the statements therein.
`(2) RESPONSE TO THE COMPLAINT- If the Secretary finds that the complaint is justified by the facts in the case, the Secretary shall permit the individual to be enrolled under the original Medicare fee-for-service program and the Medicare operated prescription drug plan or under another MA plan in which the individual was previously enrolled. An individual who is dissatisfied with the Secretary's decision on the complaint may have a hearing on the complaint before an administrative law judge in a manner similar to the manner in which such a hearing is permitted under this title with respect to other determinations under this title.'.
SEC. 303. PROTECTION FROM LOSS OF EMPLOYMENT-BASED RETIREE HEALTH COVERAGE UPON ENROLLMENT FOR MEDICARE PRESCRIPTION DRUG BENEFIT DURING 2007.
Section 1860D-22(a)(2) of the Social Security Act (
`(D) PROTECTION FROM LOSS OF EMPLOYMENT-BASED COVERAGE- The sponsor of the plan may not involuntarily discontinue coverage of an individual under a group health plan before January 1, 2008, based upon the individual's decision to enroll in a prescription drug plan or an MA-PD plan under this part.'.
SEC. 304. REQUIRED APPLICATION OF INTERMEDIATE SANCTIONS TO PROTECT AGAINST FRAUD AND ABUSE.
(a) In General- Section 1860D-12(b)(3)(E) of the Social Security Act (
(b) Application to MA-PD Plans- Section 1857(g)(1) of such Act (
SEC. 305. REPEAL OF SPECIAL WAIVER AUTHORITY FOR STATE LICENSURE.
Subsection (d) of section 423.410 of title 42, Code of Federal Regulations, is repealed, and the Secretary of Health and Human Services has no authority to provide for a waiver of a State licensure requirement described in such subsection except pursuant to section 1855(a)(2)(B) of the Social Security Act (
TITLE IV--RELATION TO SOCIAL SECURITY BENEFITS
SEC. 401. PROTECTION OF SOCIAL SECURITY BENEFITS AGAINST DECREASE DUE TO PART D MEDICARE PREMIUM INCREASES.
(a) Protection Against Decrease in Social Security Benefits-
(1) APPLICATION TO ENROLLEES IN PRESCRIPTION DRUG PLANS- Section 1860D-13(a)(1) of the Social Security Act (
(A) in subparagraph (F), by striking `(D) and (E),' and inserting `(D), (E), and (F),';
(B) by redesignating subparagraph (F) as subparagraph (G); and
(C) by inserting after subparagraph (E) the following new subparagraph:
`(F) PROTECTION OF SOCIAL SECURITY BENEFITS- For any calendar year, if an individual is entitled to monthly benefits under section 202 or 223 or to a monthly annuity under section 3(a), 4(a), or 4(f) of the Railroad Retirement Act of 1974 for November and December of the preceding year and was enrolled under a prescription drug plan or MA-PD plan for such months, the base beneficiary premium otherwise applied under this paragraph for the individual for months in that year shall be decreased by the amount (if any) by which the sum of the amounts described in the following clauses (i) and (ii) exceeds the amount of the increase in such monthly benefits for that individual attributable to section 215(i):
`(i) PART D PREMIUM INCREASE FACTOR-
`(I) IN GENERAL- Except as provided in this clause, the amount of the increase (if any) in the adjusted national average monthly bid amount (as determined under subparagraph (B)(iii)) for a month in the year over such amount for a month in the preceding year.
`(II) NO APPLICATION TO FULL PREMIUM SUBSIDY INDIVIDUALS- In the case of an individual enrolled for a premium subsidy under section 1860D-14(a)(1), zero.
`(III) SPECIAL RULE FOR PARTIAL PREMIUM SUBSIDY INDIVIDUALS- In the case of an individual enrolled for a premium subsidy under section 1860D-14(a)(2), a percent of the increase described in subclause (I) equal to 100 percent minus the percent applied based on the linear scale under such section.
`(ii) PART B PREMIUM INCREASE FACTOR- If the individual is enrolled for such months under part B--
`(I) IN GENERAL- Except as provided in subclause (II), the amount of the annual increase in premium effective for such year resulting from the application of section 1839(a)(3), as reduced (if any) under section 1839(f).
`(II) NO APPLICATION TO INDIVIDUALS PARTICIPATING IN MEDICARE SAVINGS PROGRAM- In the case of an individual who is enrolled for medical assistance under title XIX for Medicare cost-sharing described in section 1905(p)(3)(A)(ii), zero.'.
(2) APPLICATION UNDER MEDICARE ADVANTAGE PROGRAM- Section 1854(b)(2)(B) of such Act (
(3) PAYMENT FROM MEDICARE PRESCRIPTION DRUG ACCOUNT- Section 1860D-16(b) of such Act (
(A) in paragraph (1), as amended by section 101(c)(5)--
(i) by striking `and' at the end of subparagraph (D);
(ii) by striking the period at the end of subparagraph (E) and inserting `; and'; and
(iii) by adding at the end the following new subparagraph:
`(F) payment under paragraph (5) of premium reductions effected under section 1860D-13(a)(1)(F).'; and
(B) by adding at the end the following new paragraph:
`(5) PAYMENT FOR SOCIAL SECURITY BENEFIT PROTECTION PREMIUM REDUCTIONS-
`(A) IN GENERAL- In addition to payments provided under section 1860D-15 to a PDP sponsor or an MA organization, in the case of each part D eligible individual who is enrolled in a prescription drug plan offered by such sponsor or an MA-PD plan offered by such organization and who has a premium reduced under section 1860D-13(a)(1)(F), the Secretary shall provide for payment to such sponsor or organization of an amount equivalent to the amount of such premium reduction.
`(B) APPLICATION OF PROVISIONS- The provisions of subsections (d) and (f) of section 1860D-15 (relating to payment methods and disclosure of information) shall apply to payment under subparagraph (A) in the same manner as they apply to payments under such section.'.
(b) Disregard of Premium Reductions in Determining Dedicated Revenues Under MMA Cost Containment- Section 801(c)(3)(D) of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108-173) is amended by adding at the end the following: `Such premiums shall also be determined without regard to any reductions effected under section 1839(f) or 1860D-13(a)(1)(F) of such title.'.
(c) Effective Dates-
(1) PART D PREMIUM- The amendments made by subsection (a) apply to premiums for months beginning with January 2008.
(2) MMA PROVISION- The amendment made by subsection (b) shall take effect on the date of the enactment of this Act.
TITLE V--BENEFICIARY PROTECTION PROVISIONS
SEC. 501. SUSPENSION OF LATE ENROLLMENT PENALTIES; ALLOWING ONE-TIME CHANGE IN PLAN DURING FIRST YEAR OF ENROLLMENT.
(a) No Late Enrollment Penalties for Months Before January 2008- Section 1860D-13(b)(3)(B) of the Social Security Act (
(b) Change in Plan During First Year of Enrollment and During First 3 Months of Subsequent Years of Enrollment- Section 1860D-1(b)(1) of such Act (
(1) in subparagraph (B)(iii)--
(A) by inserting `and subparagraph (F) of this paragraph' after `of this subsection'; and
(B) by striking `subparagraphs (B) and (C) of paragraph (2)' and inserting `paragraph (2)(B)'; and
(2) by adding at the end the following new subparagraphs:
`(E) CHANGE IN PRESCRIPTION DRUG PLAN ALLOWED DURING FIRST YEAR OF ENROLLMENT-
`(i) IN GENERAL- Subject to clause (ii), at any time during the 12-month period beginning with the first month in which a part D eligible individual is enrolled in a prescription drug plan under this part, the individual may change the prescription drug plan in which the individual is enrolled.
`(ii) LIMITATION OF ONE CHANGE DURING PERIOD- An individual may exercise the right under clause (i) only once during such 12-month period and the exercise of such right shall be in addition to the exercise of any other rights to change such an enrollment during such period.
`(F) CHANGE IN PRESCRIPTION DRUG PLAN ALLOWED DURING FIRST 3 MONTHS OF SUBSEQUENT YEARS OF ENROLLMENT- In applying section 1851(e)(2)(C) under subparagraph (B)(iii), the change of election described in such section may only be a change in the prescription drug plan in which the individual is enrolled.'.
SEC. 502. COUNTING EXPENDITURES UNDER STATE DRUG ASSISTANCE PROGRAMS AGAINST TRUE OUT-OF-POCKET COSTS.
Section 1860D-2(b)(4)(C)(ii) of the Social Security Act (
SEC. 503. PRICE DISCLOSURE.
(a) In General- Section 1860D-2(d)(2) of the Social Security Act (
(1) in the first sentence, by striking `which are passed through' and all that follows through `other dispensers';
(2) in the second sentence, by inserting `do not' before `apply'; and
(3) in the second sentence, by inserting before the period at the end the following: `and the Secretary shall make the information described in the previous sentence available to the public'.
(b) Conforming Amendment- Section 1927(b)(3)(D) of such Act (
SEC. 504. REMOVAL OF COVERED PART D DRUGS FROM THE PRESCRIPTION DRUG PLAN FORMULARY.
Section 1860D-4(b)(3)(E) of the Social Security Act (
`(E) REMOVING DRUG FROM FORMULARY OR CHANGING PREFERRED OR TIER STATUS OF DRUG-
`(i) LIMITATION ON REMOVAL OR CHANGE- Beginning with 2008, except as provided in clause (iii), the PDP sponsor of a prescription drug plan may not--
`(I) remove a covered part D drug from the plan formulary;
`(II) change the preferred or tiered cost-sharing status of such a drug to a status less favorable to an enrollee; or
`(III) introduce a barrier, such as step therapy, prior authorization, or quantity limitation, to access to covered part D drugs,
unless advance notice under clause (ii) of such removal, change, or introduction has been provided and unless such removal, change, or introduction is only effective beginning on January 1 of the year following the year in which such notice is provided.
`(ii) NOTICE- The notice under this clause is an appropriate notice (such as under subsection (a)(3)) to the Secretary, affected enrollees, physicians, pharmacies, and pharmacists during the period beginning on September 1 and ending on October 31 of a year. Such notice shall ensure that such information is made available prior to the annual, coordinated open election period described in section 1851(e)(3)(B)(iii), as applied under section 1860D-1(b)(1)(B)(iii).
`(iii) EXCEPTION- Clause (i) shall not apply to a covered part D drug--
`(I) if it has been determined to be unsafe by the Food and Drug Administration; and
`(II) if, during a plan year, the drug changes from being a single source drug to a multiple source drug (as defined in section 1927(k)), and the prescription drug plan covers another bioequivalent multiple source drug at the same or lower cost-sharing to enrolled individuals.'.
SEC. 505. SPECIAL TREATMENT UNDER MEDICARE PART D FOR DRUGS IN 6 SPECIFIED THERAPEUTIC CATEGORIES.
(a) Medicare Part D Formularies Required To Cover All Drugs in 6 Specified Therapeutic Categories-
(1) IN GENERAL- Section 1860D-4(b)(3) of the Social Security Act (
(A) in subparagraph (C)(i), by inserting `, except as provided in subparagraph (G),' after `although'; and
(B) by inserting after subparagraph (F) the following new subparagraph:
`(G) REQUIRED INCLUSION OF DRUGS IN CERTAIN THERAPEUTIC CATEGORIES AND CLASSES-
`(i) REQUIREMENT- The formulary must include, subject to clause (iii), all or substantially all drugs in each of the following therapeutic categories of covered part D drugs:
`(I) Immunosuppresessants.
`(II) Antidepressants.
`(III) Antipsychotics.
`(IV) Anticonvulsants.
`(V) Antiretrovials.
`(VI) Antineoplastics.
`(ii) COVERAGE OF ALL UNIQUE DOSAGE FORMS- To meet the requirement under clause (i), the formulary must include all covered part D drugs and unique dosages and forms of such drugs in the categories specified in such clause, except for--
`(I) multi-source brands of the identical molecular structure;
`(II) extended release products in the case that the immediate release product involved is included on the formulary;
`(III) products that have the same active ingredient; and
`(IV) dosage forms that do not provide a unique route of administration, such as tablets and capsules.
`(iii) APPLICATION TO NEW FDA-APPROVED DRUGS- In the case of a drug that becomes a covered part D drug and that is included in a category specified in clause (i), clause (i) shall apply to such drug 30 days after the drug has been placed on the market. Nothing in the previous sentence shall be construed as preventing a pharmacy and therapeutic committee from advising a PDP sponsor of a prescription drug plan on the clinical appropriateness of formulary management practices and policies related to new drugs in such categories.
`(iv) UTILIZATION MANAGEMENT TOOLS NOT PERMITTED- A PDP sponsor of a prescription drug plan may not apply a utilization management tool, such as prior authorization or step therapy, to a drug required under clause (i) to be included on the formulary.
`(v) RULES OF CONSTRUCTION-
`(I) ISSUANCE OF GUIDANCE OR REGULATIONS TO ESTABLISH FORMULARY OR UTILIZATION MANAGEMENT REQUIREMENTS PERMITTED- Nothing in this subparagraph shall be construed as prohibiting the Secretary from issuing guidance or regulations to establish formulary or utilization management requirements under this section for any category or class of covered part D drugs if such guidance or regulations are consistent with the requirements of this subparagraph.
`(II) ADDITIONAL THERAPEUTIC CATEGORIES PERMITTED- Nothing in this subparagraph shall be construed as prohibiting the Secretary from including any additional therapeutic category or class of covered part D drugs under clause (i) for purposes of this subparagraph.'.
(2) EFFECTIVE DATE- The amendments made by paragraph (1) shall apply to plan years beginning on or after January 1, 2008.
(b) Special Requirements for Coverage Determinations, Reconsiderations, and Appeals for Drugs Included in Specified Therapeutic Categories-
(1) IN GENERAL- Section 1860D-4(g) of the Social Security Act (
`(3) RECONSIDERATION OF DETERMINATIONS RELATED TO DRUGS INCLUDED IN SPECIFIED THERAPEUTIC CATEGORIES CONDUCTED BY INDEPENDENT REVIEW ENTITY- With respect to a part D eligible individual enrolled in a prescription drug plan, in the case of a determination under this subsection that denies such individual coverage (in whole or in part) of a drug in a category specified in subsection (b)(3)(G)(i), the individual may request that the reconsideration of such determination authorized under section 1852(g)(2) (as applied by paragraph (1)) be conducted by the independent, outside entity described in paragraph (4) of section 1852(g) in accordance with the procedures for an expedited reconsideration under paragraph (3) of such section.
`(4) REQUIRED COVERAGE OF DRUGS INCLUDED IN SPECIFIED THERAPEUTIC CATEGORIES DURING DETERMINATIONS, RECONSIDERATIONS, AND APPEALS- If a part D eligible individual enrolled in a prescription drug plan offered by a PDP sponsor requests a redetermination or reconsideration under this subsection (or an appeal under subsection (h)) with respect to an utilization management requirement or denial of coverage (in whole or in part) of a drug in a category specified in subsection (b)(3)(G)(i), such sponsor shall provide such individual with coverage of such drug as prescribed during the pendency of such redetermination, reconsideration, or appeal until 60 days after the date of receipt of a written notification of--
`(A) in the case that the individual does not request a reconsideration or appeal, the determination on such redetermination;
`(B) in the case that the individual requests a reconsideration but not an appeal, the determination on such reconsideration; or
`(C) in the case that the individual requests an appeal, the determination on such appeal or the dismissal of the appeal;
except that in no case shall such coverage end before the end of the period in which an individual may file an appeal with respect to the determination involved.'.
(2) EFFECTIVE DATE- The amendment made by paragraph (1) shall apply to requests for redeterminations, reconsiderations, and appeal hearings made on or after the effective date described in subsection (a)(2).
(c) Reporting Requirements for Drugs Included in Specified Therapeutic Categories-
(1) IN GENERAL- Section 1860D-4(b) of the Social Security Act (
`(4) REPORTING REQUIREMENTS FOR DRUGS INCLUDED IN SPECIFIED THERAPEUTIC CATEGORIES-
`(A) REPORTS BY PDP SPONSORS- A PDP sponsor offering a prescription drug plan shall submit to the Secretary (in a form and manner specified by the Secretary), with respect to drugs in a category of covered part D drugs specified in subsection (b)(3)(G)(i), information on the number of favorable and unfavorable decisions under the plan relating to coverage determinations, redeterminations, reconsiderations, appeals, and enrollee requests for exceptions to formulary policies for such drugs.
`(B) REPORT TO CONGRESS- The Secretary shall submit an annual report to Congress summarizing the information submitted under subparagraph (A) and shall publish each report in the Federal Register.'.
(2) EFFECTIVE DATE- The amendment made by paragraph (1) shall apply to prescription drug plans and MA plans for plan years beginning on or after the effective date described in subsection (a)(2).
SEC. 506. REMOVAL OF EXCLUSION OF BENZODIAZEPINES FROM REQUIRED COVERAGE UNDER THE MEDICARE PRESCRIPTION DRUG PROGRAM.
(a) In General- Section 1860D-2(e)(2) of the Social Security Act (
(1) by striking `subparagraph (E)' and inserting `subparagraphs (E) and (J)'; and
(2) by inserting `and benzodiazepines' after `smoking cessation agents'.
(b) Review of Benzodiazepine Prescription Policies To Assure Appropriateness and To Avoid Abuse- The Secretary of Health and Human Services shall review the policies of Medicare prescription drug plans (and MA-PD plans) under parts C and D of title XVIII of the Social Security Act regarding the filling of prescriptions for benzodiazepine to ensure that these policies are consistent with accepted clinical guidelines, are appropriate to individual health histories, and are designed to minimize long term use, guard against over-prescribing, and prevent patient abuse.
(c) Development by Medicare Quality Improvement Organizations of Educational Guidelines for Physicians Regarding Prescribing of Benzodiazepines- The Secretary of Health and Human Services shall provide, in contracts entered into with Medicare quality improvement organizations under part B of title XI of the Social Security Act, for the development by such organizations of appropriate educational guidelines for physicians regarding the prescribing of benzodiazepines.
(d) Effective Date- The amendments made by subsection (a) shall apply to contract years beginning on or after January 1, 2008.
SEC. 507. STANDARDIZED FORMS AND PROCEDURES FOR RECONSIDERATIONS AND APPEALS.
(a) In General- Section 1860D-4 of the Social Security Act (
`(l) Standardized Forms and Procedures for Reconsiderations and Appeals-
`(1) STANDARD ENROLLEE NOTICE- The Secretary shall develop a standard notice to be distributed by a prescription drug plan (or an MA-PD plan) to an enrollee when a covered part D drug prescribed for the enrollee is not covered, or the coverage of such drug is otherwise restricted, by the plan.
`(2) STANDARDIZED PROCESS FOR RECONSIDERATIONS AND APPEALS- The Secretary shall require prescription drug plans and MA-PD plans to follow the same standardized process for reconsiderations and redeterminations under subsections (g) and (h). Such process shall require that determinations regarding medical necessity are based on professional medical judgement, the medical condition of the enrollee, the treating physician's recommendation, and other medical evidence.'.
(b) Effective Date- The Secretary of Health and Human Services shall provide for the standard notice and the standardized process, and the application of such notice and process, under the amendment made by subsection (a) by not later than January 1, 2008.
SEC. 508. ELIMINATION OF MA REGIONAL STABILIZATION FUND (SLUSH FUND); ELIMINATION OF CERTAIN MA OVERPAYMENTS.
(a) Elimination of Slush Fund-
(1) IN GENERAL- Subsection (e) of section 1858 of the Social Security Act (
(2) CONFORMING AMENDMENT- Section 1858(f)(1) of the Social Security Act (
(3) EFFECTIVE DATE- The amendments made by this subsection 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).
(b) Elimination of Certain Medicare Advantage Overpayments-
(1) IN GENERAL- Section 1853(a)(1)(C)(ii) of the Social Security Act (
(A) in the heading, by striking `DURING PHASE-OUT OF BUDGET NEUTRALITY FACTOR';
(B) in the matter preceding subclause (I), by striking `through 2010' and inserting `and subsequent years'; and
(C) in subclause (II), by striking `only for 2008, 2009, and 2010' and inserting `for 2008 and subsequent years'.
(2) EFFECTIVE DATE- The amendments made by this subsection shall take effect as if included in the enactment of section 5301 of the Deficit Reduction Act of 2005.
SEC. 509. BENEFICIARY COMPLAINTS.
(a) In General- Section 1860D-4(a) of the Social Security Act (
`(5) BENEFICIARY COMPLAINTS-
`(A) COMPLAINT LOG- The Secretary shall keep record of all complaints received at 1-800-MEDICARE and at any regional office of the Centers for Medicare & Medicaid Services from (or on behalf of) a beneficiary concerning prescription drug plans and MA-PD plans. Complaints shall be recorded even if the beneficiary does not explicitly identify the concern (or concerns) as a complaint, and even if the beneficiary is subsequently referred to the plan for complaint resolution. The Secretary shall publicly report statistical data on such complaints, including the type of complaint, whether the complaint was resolved, and the time taken to resolve the complaint.
`(B) PLAN RESPONSE TO COMPLAINTS- If the Secretary receives such a beneficiary complaint regarding such a plan and refers the complaint to such plan for investigation and resolution by the plan, the plan shall report back to the Secretary on a timely basis on the resolution of the complaint. The Secretary shall record such information in the beneficiary's record and include data on timeliness of plan's response in public reports.
`(C) REPORT TO CONGRESS- The Secretary shall annually report to Congress regarding complaints compiled under this paragraph.'.
(b) Effective Date- The amendment made by subsection (a) shall apply to contract years beginning on or after the date of the enactment of this Act.
SEC. 510. FILL OF DRUGS FOR DUAL ELIGIBLES.
(a) In General- Section 1860D-4(g) of the Social Security Act (
`(3) FILL OF DRUGS FOR FULL-BENEFIT DUAL ELIGIBLE INDIVIDUALS- In the case of a reconsideration under paragraph (1) or an exception under paragraph (2) sought with respect to a covered part D drug on behalf of a full-benefit dual eligible individual (as defined in section 1935(c)(6)), the PDP sponsor shall provide for coverage of the drug (or treatment of the drug as a preferred drug under a tiered formulary) pending disposition of the reconsideration or exception.'.
(b) Effective Date- The amendment made by subsection (a) shall apply to contract years beginning on or after the date of the enactment of this Act.
TITLE W--FAIR AND SPEEDY TREATMENT OF MEDICARE PRESCRIPTION DRUG CLAIMS
SEC. 601. PROMPT PAYMENT BY MEDICARE PRESCRIPTION DRUG PLANS AND MA-PD PLANS UNDER PART D.
(a) Application to Prescription Drug Plans- Section 1860D-12(b) of the Social Security Act (
`(5) PROMPT PAYMENT OF CLEAN CLAIMS-
`(A) PROMPT PAYMENT- Each contract entered into with a PDP sponsor under this subsection with respect to a prescription drug plan offered by such sponsor shall provide that payment shall be issued, mailed, or otherwise transmitted with respect to all clean claims submitted under this part within the applicable number of calendar days after the date on which the claim is received.
`(B) DEFINITIONS- In this paragraph:
`(i) CLEAN CLAIM- The term `clean claim' means a claim, with respect to a covered part D drug, that has no apparent defect or impropriety (including any lack of any required substantiating documentation) or particular circumstance requiring special treatment that prevents timely payment from being made on the claim under this part.
`(ii) APPLICABLE NUMBER OF CALENDAR DAYS- The term `applicable number of calendar days' means--
`(I) with respect to claims submitted electronically, 14 calendar days; and
`(II) with respect to claims submitted otherwise, 30 calendar days.
`(C) INTEREST PAYMENT- If payment is not issued, mailed, or otherwise transmitted within the applicable number of calendar days (as defined in subparagraph (B)) after a clean claim is received, interest shall be paid at a rate used for purposes of section 3902(a) of title 31, United States Code (relating to interest penalties for failure to make prompt payments), for the period beginning on the day after the required payment date and ending on the date on which payment is made.
`(D) PROCEDURES INVOLVING CLAIMS-
`(i) CLAIMS DEEMED TO BE CLEAN CLAIMS-
`(I) IN GENERAL- A claim for a covered part D drug shall be deemed to be a clean claim for purposes of this paragraph if the PDP sponsor involved does not provide a notification of deficiency to the claimant by the 10th day that begins after the date on which the claim is submitted.
`(II) NOTIFICATION OF DEFICIENCY- For purposes of subclause (II), the term `notification of deficiency' means a notification that specifies all defects or improprieties in the claim involved and that lists all additional information or documents necessary for the proper processing and payment of the claim.
`(ii) PAYMENT OF CLEAN PORTIONS OF CLAIMS- A PDP sponsor shall, as appropriate, pay any portion of a claim for a covered part D drug that would be a clean claim but for a defect or impropriety in a separate portion of the claim in accordance with subparagraph (A).
`(iii) OBLIGATION TO PAY- A claim for a covered part D drug submitted to a PDP sponsor that is not paid or contested by the provider within the applicable number of calendar days (as defined in subparagraph (B)) shall be deemed to be a clean claim and shall be paid by the PDP sponsor in accordance with subparagraph (A).
`(iv) DATE OF PAYMENT OF CLAIM- Payment of a clean claim under subparagraph (A) is considered to have been made on the date on which full payment is received by the provider.
`(E) ELECTRONIC TRANSFER OF FUNDS- A PDP sponsor shall pay all clean claims submitted electronically by an electronic funds transfer mechanism.'.
(b) Application to MA-PD Plans- Section 1857(f) of such Act (
`(3) INCORPORATION OF CERTAIN PRESCRIPTION DRUG PLAN CONTRACT REQUIREMENTS- The provisions of section 1860D-12(b)(5) shall apply to contracts with a Medicare Advantage Organization in the same manner as they apply to contracts with a PDP sponsor offering a prescription drug plan under part D.'.
(c) Effective Date- The amendments made by this section shall apply to contracts entered into or renewed on or after the date of the enactment of this Act.
SEC. 602. RESTRICTION ON CO-BRANDING.
(a) In General- Section 1860D-4(b)(2)(A) of the Social Security Act (
(b) Effective Date- With respect to cards dispensed before, on, or after the date of the enactment of this Act, the amendment made by this section shall apply to such cards on and after the date that is 90 days after such date of enactment. Any card dispensed before such date that is 90 days after the date of enactment that violates the second sentence of section 1860D-4(b)(2)(A) of the Social Security Act, as added by subsection (a), shall be reissued by such 90-day date.
SEC. 603. PROVISION OF MEDICATION THERAPY MANAGEMENT SERVICES UNDER PART D.
(a) Provision of Medication Therapy Management Services Under Part D-
(1) IN GENERAL- Section 1860D-4(c)(2) of the Social Security Act (
(A) in subparagraph (A)--
(i) in clause (i)--
(I) by inserting `or other health care provider with advanced training in medication management' after `furnished by a pharmacist'; and
(II) by striking `targeted beneficiaries described in clause (ii)' and inserting `targeted beneficiaries specified under clause (ii)'
(ii) by striking clause (ii) and inserting the following:
`(ii) TARGETED BENEFICIARIES- The Secretary shall specify the population of part D eligible individuals appropriate for services under a medication therapy management program based on the following characteristics:
`(I) Having a disease state in which evidence-based medicine has demonstrated the benefit of medication therapy management intervention based on objective outcome measures.
`(II) Taking multiple covered part D drugs or having a disease state in which a complex combination medication regimen is utilized.
`(III) Being identified as likely to incur annual costs for covered part D drugs that exceed a level specified by the Secretary or where acute or chronic decompensation of disease would likely increase expenditures under the Federal Hospital Insurance Trust Fund or the Federal Supplementary Medical Insurance Trust Fund under sections 1817 and 1841, respectively, such as through the requirement of emergency care or acute hospitalization.';
(B) by striking subparagraph (B) and inserting the following:
`(B) ELEMENTS-
`(i) MINIMUM DEFINED PACKAGE OF SERVICES- The Secretary shall specify a minimum defined package of medication therapy management services that shall be provided to each enrollee. Such package shall be based on the following considerations:
`(I) Performing necessary assessments of the health status of each enrollee.
`(II) Providing medication therapy review to identify, resolve, and prevent medication-related problems, including adverse events.
`(III) Increasing enrollee understanding to promote the appropriate use of medications by enrollees and to reduce the risk of potential adverse events associated with medications, through beneficiary and family education, counseling, and other appropriate means.
`(IV) Increasing enrollee adherence with prescription medication regimens through medication refill reminders, special packaging, and other compliance programs and other appropriate means.
`(V) Promoting detection of adverse drug events and patterns of overuse and underuse of prescription drugs.
`(VI) Developing a medication action plan which may alter the medication regimen, when permitted by the State licensing authority. This information should be provided to, or accessible by, the primary health care provider of the enrollee.
`(VII) Monitoring and evaluating the response to therapy and evaluating the safety and effectiveness of the therapy, which may include laboratory assessment.
`(VIII) Providing disease-specific medication therapy management services when appropriate.
`(IX) Coordinating and integrating medication therapy management services within the broader scope of health care management services being provided to each enrollee.
`(ii) DELIVERY OF SERVICES-
`(I) PERSONAL DELIVERY- To the extent feasible, face-to-face interaction shall be the preferred method of delivery of medication therapy management services.
`(II) INDIVIDUALIZED- Such services shall be patient-specific and individualized and shall be provided directly to the patient by a pharmacist or other health care provider with advanced training in medication management.
`(III) DISTINCT FROM OTHER ACTIVITIES- Such services shall be distinct from any activities related to formulary development and use, generalized patient education and information activities, and any population-focused quality assurance measures for medication use.
`(iii) OPPORTUNITY TO IDENTIFY PATIENTS IN NEED OF MEDICATION THERAPY MANAGEMENT SERVICES- The program shall provide opportunities for health care providers to identify patients who should receive medication therapy management services.';
(C) by striking subparagraph (E) and inserting the following:
`(E) PHARMACY FEES-
`(i) IN GENERAL- The PDP sponsor of a prescription drug plan shall pay pharmacists and others providing services under the medication therapy management program under this paragraph based on the time and intensity of services provided to enrollees.
`(ii) SUBMISSION ALONG WITH PLAN INFORMATION- Each such sponsor shall disclose to the Secretary upon request the amount of any such payments and shall submit a description of how such payments are calculated along with the information submitted under section 1860D-11(b). Such description shall be submitted at the same time and in a similar manner to the manner in which the information described in paragraph (2) of such section is submitted.'; and
(D) by adding at the end the following new subparagraph:
`(F) PHARMACY ACCESS REQUIREMENTS- The PDP sponsor of a prescription drug plan shall secure the participation in its network of a sufficient number of retail pharmacies to assure that enrollees have the option of obtaining services under the medication therapy management program under this paragraph directly from community-based retail pharmacies.'.
(2) EFFECTIVE DATE- The amendments made by this subsection shall apply to medication therapy management services provided on or after January 1, 2008.
(b) Medication Therapy Management Demonstration Program- Section 1860D-4(c) of the Social Security Act (
`(3) COMMUNITY-BASED MEDICATION THERAPY MANAGEMENT DEMONSTRATION PROGRAM-
`(A) ESTABLISHMENT-
`(i) IN GENERAL- By not later than January 1, 2008, the Secretary shall establish a 2-year demonstration program, based on the recommendations of the Best Practices Commission established under subparagraph (B), with both PDP sponsors of prescription drug plans and Medicare Advantage Organizations offering MA-PD plans, to examine the impact of medication therapy management furnished by a pharmacist in a community-based or ambulatory-based setting on quality of care, spending under this part, and patient health.
`(ii) SITES-
`(I) IN GENERAL- Subject to subclause (II), the Secretary shall designate not less than 10 PDP sponsors of prescription drug plans or Medicare Advantage Organizations offering MA-PD plans, none of which provide prescription drug coverage under such plans in the same PDP or MA region, respectively, to conduct the demonstration program under this paragraph.
`(II) DESIGNATION CONSISTENT WITH RECOMMENDATIONS OF BEST PRACTICES COMMISSION- The Secretary shall ensure that the designation of sites under subclause (I) is consistent with the recommendations of the Best Practices Commission under subparagraph (B)(ii).
`(B) BEST PRACTICES COMMISSION-
`(i) ESTABLISHMENT- The Secretary shall establish a Best Practices Commission composed of representatives from pharmacy organizations, health care organizations, beneficiary advocates, chronic disease groups, and other stakeholders (as determined appropriate by the Secretary) for the purpose of developing a best practices model for medication therapy management.
`(ii) RECOMMENDATIONS- The Commission shall submit to the Secretary recommendations on the following:
`(I) The minimum number of enrollees that should be included in the demonstration program, and at each demonstration program site, to determine the impact of medication therapy management furnished by a pharmacist in a community-based setting on quality of care, spending under this part, and patient health.
`(II) The number of urban and rural sites that should be included in the demonstration program to ensure that prescription drug plans and MA-PD plans offered in urban and rural areas are adequately represented.
`(III) A best practices model for medication therapy management to be implemented under the demonstration program under this paragraph.
`(C) REPORTS-
`(i) INTERIM REPORT- Not later than 1 year after the commencement of the demonstration program, the Secretary shall submit to Congress an interim report on such program.
`(ii) FINAL REPORT- Not later than 6 months after the completion of the demonstration program, the Secretary shall submit to Congress a final report on such program, together with recommendations for such legislation and administrative action as the Secretary determines appropriate.
`(D) WAIVER AUTHORITY- The Secretary may waive such requirements of titles XI and XVIII as may be necessary for the purpose of carrying out the demonstration program under this paragraph.'.
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