Medicare HMO Protection Act of 1998

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Medicare HMO Protection Act of 
1998''.

SEC. 2. AUTHORITY TO EVALUATE AND ALTER TERMINATION DECISIONS.

    Section 1851(g)(3) of the Social Security Act (42 U.S.C. 1395w-
21(g)(3)) is amended by adding at the end the following:
                    ``(E) Authority to delay termination date.--
                            ``(i) In general.--If a Medicare+Choice 
                        organization terminates a plan under 
                        subparagraph (B)(iii), the Secretary may delay 
                        the effectiveness of such termination if the 
                        Secretary determines that--
                                    ``(I) the termination would cause 
                                an imminent and serious risk to the 
                                health of individuals enrolled under 
                                the plan under this part;
                                    ``(II) the termination would result 
                                in a significant reduction in the 
                                Medicare+Choice plans that are 
                                available in the area affected by the 
                                termination; or
                                    ``(III) the organization 
                                terminating coverage is offering 
                                Medicare+Choice plans in contract areas 
                                that are in close proximity to the area 
                                affected by the termination without 
                                suffering considerable financial 
                                losses.
                        In making the determination described in 
                        subclause (III), the Secretary may audit and 
                        inspect any books or records of the 
                        organization pursuant to the authority provided 
                        to the Secretary under section 1857(d).
                            ``(ii) End of delay.--The Secretary may end 
                        a delay under clause (i), prior to the end of 
                        the period established by the Secretary under 
                        such clause, if the Secretary determines that 
                        an adequate provider network has been 
                        established which will provide at least an 
                        equal level of insurance coverage as existed in 
                        the area affected by the termination on the 
                        date the Medicare+Choice organization informed 
                        the Secretary of its intention to terminate the 
                        contract.
                    ``(F) Authority to renegotiate contract.--If the 
                Secretary delays the effectiveness of a termination for 
                a period pursuant to subparagraph (E), the Secretary 
                and the Medicare+Choice organization terminating 
                coverage pursuant to subparagraph (B)(iii) may 
                negotiate during such period for a new contract under 
                section 1857 which will enable such organization to 
                continue such coverage. In negotiating such contract, 
                the Secretary shall ensure that beneficiaries are not 
                adversely affected by such contract.''.

SEC. 3. EXTENSION OF INITIAL MEDICARE+CHOICE CONTRACT PERIOD TO 3 
              YEARS.

    (a) In General.--Section 1857(c)(1) of the Social Security Act (42 
U.S.C. 1395w-27(c)(1)) is amended by striking ``a term of at least 1 
year'' and inserting ``a term of at least 3 years''.
    (b) Effective Date.--The amendment made by subsection (a) applies 
to contracts entered into on or after the date of enactment of this 
Act.

SEC. 4. NOTICE OF TERMINATION.

    (a) In General.--Section 1857(d)(3) of the Social Security Act (42 
U.S.C. 1395w-27(d)(3)) is amended to read as follows:
            ``(3) Enrollee notice at time of termination.--
                    ``(A) In general.--Each contract under this section 
                shall require the organization to provide (and pay for) 
                written notice at least 120 days prior to the 
                contract's termination, as well as a description of 
                alternatives for obtaining benefits under this title, 
                to each individual enrolled with the organization under 
                this part.
                    ``(B) Description.--The description of alternatives 
                referred to in subparagraph (A) shall include a 
                description of--
                            ``(i) all Medicare+Choice plans and 
                        medicare supplemental policies available in the 
                        area where the contract that is being 
                        terminated is serving beneficiaries and the 
                        costs of such plans and policies; and
                            ``(ii) the telephone number of local social 
                        service agencies providing assistance to 
                        medicare beneficiaries in such area.''.
    (b) Effective Date.--The amendment made by subsection (a) applies 
to any notice of termination which is provided on or after the date of 
enactment of this Act.

Summary: Medicare HMO Protection Act of 1998 - Amends part C (MedicareChoice) of title XVIII (Medicare) of the Social Security Act to authorize the Secretary of Health and Human Services to delay the effectiveness of a MedicareChoice organization's termination of its plan with respect to all individuals in an area, if: (1) the termination would cause an imminent and serious health risk to enrollees. (2) the termination would result in a significant reduction in the MedicareChoice plans available in the area affected. Or (3) the organization terminating coverage is offering MedicareChoice plans in contract areas close to the area affected without suffering considerable financial losses. Amends Medicare part C with regard to contracts with MedicareChoice organizations to provide for extension of the initial MedicareChoice contract period from one year to three years and to revise certain requirements for notification of enrollees at the time of contract termination.