Exhibit 10.5

 

MA-ONLY EMPLOYER/ UNION-ONLY GROUP CONTRACT ADDENDUM

 

EMPLOYER/UNION-ONLY GROUP PART C ADDENDUM TO CONTRACT

WITH APPROVED ENTITY PURSUANT TO SECTIONS 1851 THROUGH 1859

OF THE SOCIAL SECURITY ACT FOR THE OPERATION OF A MEDICARE

ADVANTAGE PLAN

 

The Centers for Medicare & Medicaid Services (hereinafter referred to as “CMS”)
and (See Chart), a Medicare Advantage Organization (hereinafter referred to as
the “MA Organization”) agree to amend the contract (See Chart) (INSERT “H” OR
“R” NUMBER) governing the MA Organization’s operation of a Medicare Advantage
plan described in section 1851(a)(2)(A) or section 1851(a)(2)(C) of the Social
Security Act (hereinafter referred to as “the Act”), including all attachments,
addenda, and amendments thereto, to include the provisions contained in this
Addendum (collectively hereinafter referred to as the “contract”), under which
the MA Organization shall offer Employer/Union-Only Group MA-Only Plans
(hereinafter referred to as “employer/union-only group health plans”) in
accordance with the waivers granted by CMS under section 1857(i) of the Act. The
terms of this Addendum shall only apply to MA-only health plans offered
exclusively to employers/unions.

 

This Addendum is made pursuant to Subpart K of 42 CFR Part 422.

 

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MA-ONLY EMPLOYER/ UNION-ONLY GROUP CONTRACT ADDENDUM

 

Article I

Employer/Union-Only Group Medicare Advantage Health Plan

 

A. MA Organization agrees to operate one or more employer/union-only group
health plans in accordance with the terms of this Addendum, the Medicare
Advantage contract (except for requirements contained therein that are expressly
waived or modified by this Addendum), all provisions of Federal statutes,
regulations, and policies applicable to MA organizations or MA plans (except to
the extent any such provisions are expressly waived or modified by this
Addendum), and any employer/union-only group waiver guidance.

 

B. This Addendum is deemed to incorporate any changes that are required by
statute to be implemented during the term of the contract, and any regulations
and policies implementing or interpreting such statutory provisions.

 

C. In the event of any conflict between the employer/union-only group waiver
guidance issued prior to the execution of the contract and this Addendum, the
provisions of this Addendum shall control. In the event of any conflict between
the employer/union-only group waiver guidance issued after the execution of the
contract and this Addendum, the provisions of the employer/union-only group
guidance shall control.

 

D. This Addendum is in no way intended to supersede or modify 42 CFR Part 422 or
sections 1851 through 1859 of the Act, except as specifically provided in
applicable employer/union-only group waiver guidance and/or in this Addendum.
Failure to reference a statutory or regulatory requirement in this Addendum does
not affect the applicability of such requirement to the MA Organization and CMS.

 

E. The provisions of this Addendum apply to all employer/union-only group health
plans offered by MA Organization. In the event of any conflict between the
provisions of this Addendum and any other provision of the contract, the terms
of this Addendum shall control.

 

Article II

Functions to be Performed by the Medicare Advantage Organization

 

A. PROVISION OF BENEFITS

 

  1. MA Organization agrees to provide enrollees in each of its
employer/union-only group health plans the basic benefits (hereinafter referred
to as “basic benefits”) as required under 42 CFR §422.101 and, to the extent
applicable, supplemental benefits under 42 CFR §422.102 and as established in
the MA Organization’s final benefit and price bid proposal as approved by CMS.

 

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MA-ONLY EMPLOYER/ UNION-ONLY GROUP CONTRACT ADDENDUM

 

  2. MA Organization may swap different types of mandatory supplemental benefits
and optional supplemental benefits (as defined in 42 CFR §422.2) (hereinafter
referred to as “supplemental benefits”) of equal actuarial value in
employer/union-only group health plans.

 

  3. MA Organization may modify the cost sharing (e.g., coinsurance, copayments,
deductibles) of basic and supplemental benefits offered in employer/union-only
group health plans by providing a higher benefit level and/or a modified premium
to employer/union-only groups contracting with MA Organization. The uniformity
of premium, benefits, and cost-sharing requirement of 42 CFR §422.100(d)(2)
shall not apply to such modifications. The overall value of each modified
benefit offered to employer/union-only groups must be actuarially equivalent to
the basic and/or supplemental benefit offered in the employer/union-only group
health plan and the modification must not have the effect of denying or
discouraging access to covered medically-necessary health care items and
services as set forth in 42 CFR §422.100(f)(2).

 

  4. The requirements in section 1852 of the Act and 42 CFR §422.100(c)(1)
pertaining to the offering of benefits covered under Medicare Part A and in
section 1851 of the Act and 42 CFR §422.50(a)(1) pertaining to who may enroll in
an MA plan are waived for employer/union-only group health plan enrollees who
are not entitled to Medicare Part A.

 

  5. For employer/union-only group health plans offering non-calendar year
coverage, MA Organization may determine basic and supplemental benefits
(including deductibles, out-of-pocket limits, etc.) on a non-calendar year basis
subject to the following requirements:

 

(a) Applications, bids, and other submissions to CMS must be submitted on a
calendar year basis; and

 

(b) CMS payments will be determined on a calendar year basis.

 

  6. For employer/union-only group health plans that have a monthly beneficiary
rebate described in 42 CFR §422.266:

 

(a) MA Organization may vary the form of rebate allocation so that the rebates
vary between employer/union groups within the plan benefit package for an
employer/union group to whom MA Organization offers the plan, with the exception
of a rebate credited toward the reduction of the Part B premium. Any reduction
of the Part B premium through crediting of the rebate must be available to all
members of the plan at the same level, regardless of the enrollee’s
employer/union group affiliation; and

 

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MA-ONLY EMPLOYER/ UNION-ONLY GROUP CONTRACT ADDENDUM

 

(b) MA Organization must:

 

(a) ensure Part B premium buy-downs are the same for all enrollees;

 

(b) ensure that the total monthly rebate amount for the plan total rebates per
enrollee are uniform across employer groups in the plan and that all rebates are
accounted for and used only for the purposes provided in the Act; and

 

(c) retain documentation that supports the use of all of the rebates on a
detailed basis and must provide access to this documentation in accordance with
the requirements of 42 CFR §422.501.

 

B. ENROLLMENT REQUIREMENTS

 

  1. MA Organization agrees to restrict enrollment in an employer/union-only
group health plan to those individuals eligible for the employer’s/union’s
employment-based group coverage.

 

  2. MA Organization will not be subject to the requirement set forth in 42 CFR
§422.50 to offer the employer/union-only group health plan to all eligible
beneficiaries residing in the plan’s service area.

 

  3. If an employer/union elects to enroll individuals eligible for its
employer/union-only group health plan through a group enrollment process, MA
Organization will not be subject to the individual enrollment requirements set
forth in 42 CFR §422.60. MA Organization agrees that all individuals eligible
for its employer/union-only group health plan will be advised that the
employer/union contracting with MA Organization to offer an employer/union-only
group health plan (hereinafter referred to as “employer/union”) intends to
enroll them into the plan through a group enrollment process unless the
individual affirmatively opts out of such enrollment. MA Organization agrees
that all such individuals will be provided this information at least 30 days
prior to the effective date of the individual’s enrollment in the
employer/union-only group health plan. MA Organization agrees the information
must include a summary of benefits offered under the employer/union-only group
health plan, an explanation of how to get more information on such plan, and an
explanation of how to contact Medicare for information on other MA plans that
might be available to the individual. In addition, MA Organization agrees that
all information necessary to effectuate enrollment must be submitted
electronically to CMS, consistent with CMS instructions.

 

C. BENEFICIARY PROTECTIONS

 

  1. MA Organization’s employer/union-only group health plans will not be
subject to the marketing requirements set forth in 42 CFR §422.80.

 

  2.

CMS agrees that the disclosure requirements set forth in 42 CFR §§422.111 will
not apply with respect to any employer/union-only group health plan when the

 

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MA-ONLY EMPLOYER/ UNION-ONLY GROUP CONTRACT ADDENDUM

 

 

employer/union is subject to alternative disclosure requirements (e.g., the
Employee Retirement Income Security Act of 1974 (“ERISA”)) and fully complies
with such alternative requirements. MA Organization agrees to provide
beneficiary plan documents, including summary plan descriptions and all other
beneficiary communications that provide descriptions of the benefit offerings,
to CMS at the time of use and to current and/or potential enrollees on a timely
basis. CMS may review these documents in the event of beneficiary complaints or
for other reasons and require changes if CMS determines that such changes are
necessary.

 

D. SERVICE AREA

 

  1. CMS agrees that Local employer/union-only group health plans that provide
coverage to individuals in any part of a State can offer coverage to individuals
eligible for the employer/union-only group throughout that State.

 

  2. CMS agrees that Regional employer/union-only group health plans and
non-network Private Fee-for-Service employer/union-only group health plans may
extend coverage beyond their designated service areas to all enrollees of a
particular employer/union-only group plan, regardless of where they reside in
the nation, when the most substantial portion of the employer’s employees (or in
the case of a union, the union’s participants) reside in the service area where
the MA Organization, either itself or through subcontractors or other partners,
is a provider of non-group MA coverage. The MA Organization agrees to conduct an
actual review of where the substantial portion of the employer’s/union’s
employees/participants reside and to maintain adequate supporting documentation
of such review (including the date of such review, by whom the review was
conducted, and any other relevant documentation to substantiate the review), and
to permit CMS to audit and review such documentation.

 

F. PAYMENT TO MA ORGANIZATION

 

MA Organization acknowledges that the risk sharing, plan entry and retention
bonus provisions of section 1858 of the Act and 42 CFR §422.458 shall not apply
to Regional employer/union-only group health plans.

 

Article III

Record Retention and Reporting Requirements

 

A. GENERAL REPORTING REQUIREMENTS

 

MA Organization is not subject to the general public reporting requirements
contained in 42 CFR §422.516(a) for its employer/union-only group plans to the
extent that: (1) such information is required to be reported to enrollees and to
the general public by other law (including ERISA or securities laws) or by a
separate contractual agreement and (2) MA Organization fully complies with such
requirements.

 

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