prompt_front: You are given two reports by the government agency.



Question: Write a one-page summary of the report 1.

Report 1: Cross-border data flows underlie today's globally connected world and are essential to conducting international trade and commerce  Data flows enable companies to transmit information for online communication, track global supply chains, share research, and provide cross-border services  One study estimates that digital commerce relying on data flows drives 22% of global economic output, and that global GDP will increase by another $2 trillion by 2020 due to advances in emerging technologies  However, while cross-border data flows increase productivity and enable innovation, they also raise concerns around the security and privacy of the information being transmitted  Cross-border data flows are central to trade and trade negotiations as organizations rely on the transmission of information to use cloud services, and to send nonpersonal corporate data as well as personal data to partners, subsidiaries, and customers  U S  policymakers are considering various policy options to address online privacy, some of which could affect cross-border data flows  For example, new consumer rights to control their personal data may impact how companies can use such data  To enable international data flows and trade, the United States has aimed to eliminate trade barriers and establish enforceable international rules and best practices that allow policymakers to achieve public policy objectives, including promoting online security and privacy  Building consensus for international rules and norms on data flows and privacy has become increasingly important as recent incidents have heightened the public's awareness of the risk of personal data stored online  For example, the 2018 Cambridge Analytica scandal drew attention because the firm reportedly acquired and used data on more than 87 million Facebook accounts in an effort to influence voters in the 2016 U S  presidential election and the UK referendum on continued European Union (EU) membership ("Brexit")  In addition, security concerns have been raised about data breaches, such as those that exposed the personal data of half a million Google users or 500 million Marriot hotel customers  Organizations value consumers' personal online data for a variety of reasons  For example, companies may seek to facilitate business transactions, analyze marketing information, detect disease patterns from medical histories, discover fraudulent payments, improve proprietary algorithms, or develop competitive innovations  Some analysts compare data to oil or gold, but unlike those valuable substances, data can be reused, analyzed, shared, and combined with other information; it is not a scarce resource  However, personal data is considered personal private property  Individuals often want to control who accesses their data and how it is used  Experts suggest that data may therefore be considered both a benefit and a liability that organizations hold  Data has value, but an organization takes on risk by collecting personal data; they become responsible for protecting users' privacy and not misusing the information  Data privacy concerns may become more urgent as the amount of online information organizations access and collect, and the level of global data flows, continue to expand  Countries vary in their policies and laws on these issues  The United States has traditionally supported open data flows and has regulated privacy at a sectoral level to cover data, such as health records, rather than create a comprehensive policy  U S  trade policy has sought to balance the goals of consumer privacy, security, and open commerce, including eliminating trade barriers and opening markets  Other countries are developing data privacy policies that affect international trade as some governments or groups seek to limit data flows outside of an organization or across national borders for a number of reasons  Blocking international data flows may impede the ability of a firm to do business or of an individual to conduct a transaction, creating a form of trade protectionism  Research demonstrates not only the economic gains from digital trade and international data flows, but also the real economic costs of restrictions on such flows  For many policymakers, the crux of the issue is: How can governments protect individual privacy in the least trade-restrictive way possible? The question is similar to concerns raised about ensuring cybersecurity while allowing the free flow of data  In recent years, Congress has examined multiple issues related to cross-border data flows and online privacy  In the 115 th Congress, congressional committees held hearings on these topics, introduced multiple bills, and conducted oversight over federal laws on related issues such as data breach notification  Members are introducing new bills and holding hearings in the 116 th Congress  Congress may consider the proposed U S -Mexico-Canada Agreement (USMCA) and examine the digital trade chapter as an example of how to address the issues through trade agreements  In most circumstances, a consumer expects both privacy and security when conducting an online transaction  However, users' expectations and values may vary and there is no globally accepted standard or definition of data privacy in the online world  In addressing online privacy, Congress may need to define personal data and differentiate between sensitive and nonsensitive personal data  In general, data privacy can be defined by an individual's ability to prevent access to personally identifiable information (PII)  According to the U S  Office of Management and Budget (OMB) guidance to federal agencies, PII refers to information that can be used to distinguish or trace an individual's identity, either alone or when combined with other information that is linked or linkable to a specific individual  Since electronic data can be readily shared and combined, some data not traditionally considered PII may have become more sensitive  For example, the OMB definition does not specifically mention data on location tracking, purchase history, o r preferences, but these digital data points can be tracked by a device such as a mobile phone or laptop that an individual carries or logs into  The EU definition of PII attempts to capture the breadth of data available in the online world: "personal data" means any information relating to an identified or identifiable natural person ('data subject'); an identifiable natural person is one who can be identified, directly or indirectly, in particular by reference to an identifier such as a name, an identification number, location data, an online identifier or to one or more factors specific to the physical, physiological, genetic, mental, economic, cultural or social identity of that natural person  Policymakers may consider differentiating between sensitive and nonsensitive personal data  For example, sensitive personal data could include ethnic origin, political or religious affiliation, biometric data, health data, sexual orientation, precise geolocation data, etc  "Cross-border data flows" refers to the movement or transfer of information between computer servers across national borders  Cross-border data flows are part of, and integral to, digital trade and facilitate the movement of goods, services, people, and finance  A 2017 analysis estimated that global flows of goods, services, finance, and people increased world gross domestic product (GDP) by at least 10% in the past decade, adding $8 trillion between 2005 and 2015  Effective and sustainable digital trade relies on data flows that permit commerce and communication but that also ensure privacy and security, protect intellectual property, and build trust and confidence  Impeding cross-border data flows, including through some privacy regulations, may decrease efficiency and reduce other benefits of digital trade, resulting in the fracturing, or so-called balkanization, of the internet  In addressing online privacy, some policymakers focus on limiting access to online information by restricting the flow of data beyond a country's borders  Such limits may also act as protectionist measures  Online privacy policies may create barriers to digital trade, or damage trust in the underlying digital economy  For example, measures to limit cross-border data flows could block companies from using cloud computing to aggregate and analyze global data, or from gaining economies of scale, constrain e-commerce by limiting international online payments, hinder global supply chains seeking to use blockchain to track products or manage supply chains, customs documentation, or electronic payments, impede the trading of crypto-currency, or limit the use of advanced technology like artificial intelligence  According to the World Trade Organization (WTO), one of the most significant overall impacts of the growth of digital technologies is in transforming international trade  Technology can lower the costs of trade, change the types of goods and services that are traded, and may even change the factors defining a country's comparative advantage  The extent of the impact of digital technologies on trade, however, depends in large part on open cross-border data flows  One study of U S  companies found that data localization rules (i e , requiring organizations to store data on local servers) were the most-cited digital trade barrier  Some governments advocate privacy or security policies that require data localization and limit cross-border data flows  However, many industry stakeholders argue that blocking cross-border data flows and storing data domestically does not make such data more secure or private  Many experts argue that policymakers should limit cross-border data flows in the least trade-restrictive manner possible and also ensure security and privacy  These objectives are not easily reconciled  Moreover, although an overlap exists between data protection and privacy, the two are not equivalent  Cybersecurity measures are essential to protect data (e g , against intrusions or theft by hackers)  However, they may not be sufficient to protect privacy  For example, if an organization shares user data with a third party, it may be doing so securely, but not in a way that protects users' privacy or aligns with consumer expectations  Similarly, breach notification requirements are not the same as proactive privacy protection measures  At the same time, policies that protect a consumer's privacy can align with security policies  Laws can limit law enforcement's access to information except in certain circumstances  Keeping user information anonymous may enable firms to analyze data while protecting individuals' identities  Some see an inherent conflict between online security, privacy, and trade; others believe that policies protecting all three can be coherent and consistent  The U S  government has traditionally sought to balance these objectives  Some stakeholders note, however, that current U S  policy has been inadequate in protecting online privacy and that change is needed  In some cases in the past, Congress has acted to address privacy concerns in particular sectors; for example, the Health Insurance Portability and Accountability Act (HIPAA) of 1996 led to health privacy standards regulations  The Trump Administration has begun an effort to devise an overarching data privacy policy (see " Defining the U S  Approach ") and many Members of Congress are also considering possible approaches  There are no comprehensive multilateral rules specifically about privacy or cross-border data flows  However, the United States and other countries have begun to address these issues in negotiating new and updated trade agreements, and through international economic forums and organizations such as the Asia-Pacific Economic Cooperation (APEC) forum and the Organisation for Economic Co-operation and Development (OECD)  The World Trade Organization (WTO) General Agreement on Trade in Services (GATS) entered into force in January 1995, predating the current reach of the internet and the explosive growth of global data flows  Many digital products and services that did not exist when the agreements were negotiated are not covered  On the other hand, privacy is explicitly addressed within GATS as an exception to allow countries to take measures that do not conform with the agreement in order to protect "the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts," as long as those measures are not arbitrary or a disguised trade restriction  Efforts to update the multilateral agreement and discussions for new digital trade rules under the WTO Electronic Commerce Work Program stalled in 2017  Given the lack of progress on multilateral rules, some have suggested that the WTO should identify best practices or guidelines for digital trade rules that could lay the foundation for a future multilateral WTO agreement  In December 2017, a group of more than 70 WTO members, including the United States, agreed to "initiate exploratory work together toward future WTO negotiations on trade-related aspects of electronic commerce " Overall U S  objectives include allowing the free flow of information for international trade and cross-border data flows, "subject to reasonable safeguards like the protection of consumer data when it is exported," but do not specifically address privacy  The group formally launched the e-commerce initiative in January 2019  The official joint statement lists the United States and EU as participants, and also several developing countries such as China and Brazil  India stated it will not join, preferring to maintain its flexibility to favor domestic firms, limit foreign market access, and raise revenue in the future  The statement did not define the scope of any potential agreement  After the meeting, the EU noted data localization measures among the potential new rules to be discussed when negotiations officially launch in March 2019  The U S  Trade Representative's (USTR's) statement emphasized the need for a high-standard agreement that includes enforceable obligations  Although some experts note that harmonization or mutual recognition is unlikely given divergent legal systems, privacy regimes, and norms of the parties, a common system of rules to allow for cross-border data flows while ensuring privacy protection is reportedly under discussion  Personal privacy has received increasing focus with the growth of digital trade encouraging global cooperation  The United States has contributed to developing international guidelines or principles related to privacy and cross-border data flows, although none are legally binding  The OECD 1980 Privacy Guidelines established the first international set of privacy principles emphasizing data protection as a condition for the free flow of personal data across borders  These OECD guidelines were intended to assist countries with drawing up national data privacy policies  The guidelines were updated in 2013, focusing on national level implementation based on a risk management approach and improving interoperability between national privacy strategies  The updated guidelines identify specific principles for countries to take into account in establishing national policies  The guidelines are to be reviewed and updated again in 2019  Building on the OECD principles and prior G-20 work, the 2018 G-20 Digital Economy Ministerial Declaration identified principles to "facilitate an inclusive and whole-of-government approach to the use of information and communication technology (ICT) and assist governments in reshaping their capacities and strategies, while respecting the applicable frameworks of different countries, including with regards to privacy and data protection " Japan is to host the 2019 G-20 and plans to focus on data governance, offering a forum to address potential global standards on privacy and cross-border data flows  APEC is a regional forum for economic cooperation whose initiatives on privacy and cross-border data flows have influenced members' domestic policies  APEC's 21 members, including the United States, agreed to the 2005 APEC Privacy Framework , based on the OECD guidelines  The framework identifies a set of principles and implementation guidelines to provide members with a flexible approach to regulate privacy at a national level  Once the OECD publishes updated guidelines in 2019, APEC members may revise the framework and principles to reflect the updated guidelines  The APEC Cross-Border Privacy Rules (CBPR), endorsed by APEC Leaders in 2011, is a privacy code of conduct, based on the framework  The CBPR system establishes a set of principles for governments and businesses to follow to protect personal data and allow for cross-border data flows between CBPR members  They aim to balance information privacy with business needs and commercial interests, and facilitate digital trade to spur economic growth in the region  Rather than creating a new set of international regulations, the APEC framework and CBPR system identify best practices that each APEC member can tailor to its domestic legal system and allow for interoperability between countries  The scope and implementation mechanisms under CBPR can vary according to each member country's laws and regulations, providing flexibility for governments to design national privacy approaches  To become a member of the CBPR, a government must 1  Be a member of APEC; 2  Establish a regulator with authority to sign the Cross-Border Privacy Enforcement Arrangement (CPEA); 3  Map national laws to the published APEC guidelines, which set baseline standards; and 4  Establish an accountability agent empowered to audit and review a company's practices, and enforce privacy rules and laws  If a government joins the CBPR system, every domestic organization is not required to also join; however, becoming a member of CBPR may benefit an organization engaged in international trade by indicating to customers and partners that the organization values and protects data privacy  With certified enrollment in CBPR, organizations can transfer personal information between participating economies (e g , Mexico to Singapore) and be assured of compliance with the legal regimes in both places  To become a CBPR member, an individual organization must develop and implement data privacy policies consistent with the APEC Privacy Framework and complete a questionnaire  The third party accountability agent is responsible for assessing an organization's application, ongoing monitoring of compliance, investigating any complaints, and taking enforcement actions as necessary  Domestic enforcement authorities in each member country serve as a backstop for dispute resolution if an accountability agent cannot resolve a particular issue  All CBPR member governments must join the CPEA to ensure cooperation and collaboration between the designated national enforcement authorities  In the United States, the Federal Trade Commission (FTC) is the regulator and enforcement authority  TrustArc is the only accountability agent, but many expect the U S  Department of Commerce to recognize additional agents soon  As of this writing, TrustArc lists about 20 U S  firms that are APEC CBPR certified  The CBPR grows in significance as the number of participating economies and organizations increases  The U S  ambassador to APEC aims to have "as many APEC economies as possible as soon as possible to join the system " Currently, the United States, Japan, Mexico, Canada, South Korea, Singapore, Taiwan, and Australia are CBPR members; the Philippines is in the process of joining  Russia, on the other hand, stated it has no plans to join  Although APEC initiatives are regionally focused, they can provide a basis to scale up to larger global efforts because they reflect economies at different stages of development and include industry participation  Due to its voluntary nature, APEC has served as a testbed for identifying best practices, standards, and principles and for creating frameworks that can lead to binding commitments in plurilateral or larger multilateral agreements (see " Data Flows and Privacy in U S  Trade Agreements ")  Expanding CBPR beyond APEC could represent the next step toward consistent international rules and disciplines on data flows and privacy  Countries vary in their privacy policies and laws, reflecting differing priorities, cultures, and legal structures  According to one index, China is the most restrictive digital trade country among 64 countries surveyed, followed by Russia, India, Indonesia, and Vietnam (see Figure 1 )  The United States ranks 22 in the index, less restrictive than Brazil or France but more restrictive than Canada or Australia  The relatively high U S  score largely reflects financial sector restrictions  The "restrictions on data" category covers data policies such as privacy and security measures; this category is included in the composite index  Looking specifically at the 64 countries' data policies, Russia is the most restrictive country, followed by Turkey and China  Russia's policies include data localization, retention, and transfer requirements, among others  Turkey's comprehensive Data Protection Law also establishes requirements in these areas  In contrast, the United States ranks 50 for data policy restrictions  Two of the top U S  trading partners (the EU and China) have established their data policies from different perspectives  The EU's policies are driven by privacy concerns; China's policies are based on security justifications  Both are setting examples that other countries, especially those with (or seeking) closer trading ties to China or the EU, are emulating; thus, these policies have affected U S  firms seeking to do business in those other countries as well  The EU considers the privacy of communications and the protection of personal data to be fundamental human rights, which are codified in EU law  Differences between the United States and EU in their approaches to data protection and data privacy laws have long been sticking points in U S -EU economic and security relations  The EU and United States negotiated the U S -EU Privacy Shield to allow for the transatlantic transfer of personal data by certified organizations  The bilateral agreement established a voluntary program with commitments and obligations for companies, limitations on law enforcement access, and transparency requirements  U S  companies that participate in the program must still comply with all of the obligations under EU law (see below) if they process personal data of EU persons  The Privacy Shield is overseen and enforced by EU federal and U S  agencies, including the Department of Commerce and the FTC, and is reviewed by both parties annually  The EU's General Data Protection Regulation (GDPR), effective May 2018, establishes rules for EU members, with extraterritorial implications  The GDPR is a comprehensive privacy regime that builds on previous EU data protection rules  It grants new rights to individuals to control personal data and creates specific new data protection requirements  The GDPR applies to (1) all businesses and organizations with an EU establishment that process (i e , perform operations on) personal data of individuals in the EU, regardless of where the actual processing of the data takes place; and (2) entities outside the EU that offer goods or services (for payment or for free) to individuals in the EU or monitor the behavior of individuals in the EU  While the GDPR is directly applicable at the EU member state level, individual countries are responsible for establishing some national-level rules and policies as well as enforcement authorities, and some are still in the process of doing so  As a result, some U S  stakeholders have voiced concerns about a lack of clarity and inadequate country compliance guidelines  Many U S  firms doing business in the EU have made and are making changes to comply with the GDPR, such as revising and clarifying user terms of agreement and asking for explicit consent  For some U S  companies, it may be easier and cheaper to apply GDPR protections to all users worldwide rather than to maintain different policies for different users  Large firms may have the resources to hire consultants and lawyers to guide implementation and compliance; it may be harder and costlier for small and mid-sized enterprises to comply, possibly deterring them from entering the EU market and creating a de facto trade barrier  Since the GDPR went into effect on May 25, 2018, some U S  businesses, including some newspaper websites and digital advertising firms, have opted to exit the EU market given the complexities of complying with the GDPR and the threat of potential enforcement actions  European Data Protection Authorities (DPAs) have received a range of GDPR complaints and initiated several GDPR enforcement actions in the fall of 2018  In January 2019, the French DPA issued the largest penalty to date for a data privacy breach  The agency imposed a €50 million (approximately $57 million) fine on Google for the "lack of transparency" regarding how the search engine processes user data  Analysts contend that the high fine may set a benchmark and signal for future enforcement, raising concerns among some firms doing business in the EU  Under the GDPR, a few options exist to transfer personal data in or out of the EU and ensure that privacy is maintained  1  An organization may use specific Binding Corporate Rules (BCRs) or Model Contracts approved by the EU; 2  An organization may comply with domestic privacy regimes of a country that has obtained a mutual adequacy decision from the EU, which means that the EU has deemed that a country's laws and regulations provide an adequate level of data protection; currently, fewer than 15 jurisdictions are deemed adequate by the EU; or 3  A U S -based organization may enroll in the bilateral U S -EU Privacy Shield program for transatlantic transfer of personal data  The GDPR legal text seems to envision a fourth way, such as a certification scheme to transfer data, that the EU has yet to elaborate  A certification option(s) could create a less burdensome means of compliance for U S  and other non-EU organizations to transfer personal data to or from the EU in the future  This could be an opportunity for the United States to work with the EU on creating a common system, perhaps even setting a global standard  Some experts contend that the GDPR may effectively set new global data privacy standards, since many companies and organizations are striving for GDPR compliance to avoid being shut out of the EU market, fined, or otherwise penalized, or in case other countries introduce rules that imitate the GDPR  The EU is actively promoting the GDPR and some countries, such as Argentina, are imitating all or parts of the GDPR in their own privacy regulatory and legislative efforts or as part of broader trade negotiations with the EU  In general, the EU does not include cross-border data flows or privacy in free trade agreements  However, alongside trade negotiations with Japan, the EU and Japan agreed to recognize each other's data protection systems as "equivalent," allowing for the free flow of data between the EU and Japan and serving as a first step in adopting an adequacy decision  Under the agreement, Japan committed to implementing additional measures to address the handling of the personal data of EU persons on top of Japan's own privacy regime  China's trade and internet policies reflect state direction and industrial policy, limiting the free flow of information and individual privacy  For example, the requirement for all internet traffic to pass through a national firewall can impede the cross-border transmission of data  China's 2015 counterterrorism law requires telecommunications operators and internet service providers to provide assistance to the government, which could include sharing individuals' data  Citing national security concerns, China's Internet Sovereignty policies, Cybersecurity Law, and Personal Information Security Specification impose strict requirements on companies, such as storing data domestically; limiting the ability to access, use, or transfer data internationally; and mandating security assessments that provide Chinese authorities access to proprietary information  In 2014, China announced a new social credit system, a centralized big-data-enabled system for monitoring and shaping businesses' and citizens' behavior that serves as a self-enforcing regulatory mechanism  According to the government, China aims to make individuals more "sincere" and "trustworthy," while obtaining reliable data on the creditworthiness of businesses and individuals  An individual's score would determine the level of government services and opportunities he or she could receive  China seeks to have all its citizens subject to the social credit system by 2020, forcing some U S  businesses who do business in China, such as airlines, to participate  As of 2018, multiple government agencies and financial institutions contribute data to the platform  Pilot projects are underway in some provinces to apply various rewards and punishments in response to data collected  The lack of control an individual may have and the exposure of what some consider private data is controversial among observers in and out of China  Some countries, such as Vietnam, are following China's approach in creating cybersecurity policies that limit data flows and require local data storage and possible access by government authorities  Some U S  firms and other multinational companies are considering exiting the Vietnamese market rather than complying, while some analysts suggest that Vietnam's law may not be in compliance with its recent commitments in trade agreements (see below)  India has also cited security as the rationale for its draft Personal Data Protection Bill, which would establish broad data localization requirements and limit cross-border transfer of some data  Unlike the EU, these countries do not specify mechanisms to allow for cross-border data flows  U S  officials have raised concerns with both Vietnam's and India's localization requirements  The EU's emphasis on privacy protection and China's focus on national security (and the countries that emulate their policies) have led these countries to create data-focused policies that restrict international trade and commerce  The United States has traditionally sought a balanced approach between trade, privacy, and security  U S  data flow policy priorities are articulated in USTR's Digital 2 Dozen report, first developed under the Obama Administration, and the White House's 2017 National Security Strategy  Both Administrations emphasize the need for protection of privacy, the free flow of data across borders, and an interoperable internet  These documents establish the U S  position that the free flow of data is not inconsistent with privacy protection  Recent free trade agreements translate the U S  position into binding international commitments  The United States has taken a data-specific approach to regulating data privacy, with laws protecting specific information, such as healthcare or financial data  The FTC enforces consumer protection laws and requires that consumers be notified of and consent to how their data will be used, but the FTC does not have the mandate or resources to enforce broad online privacy protections  There is growing interest among some Members of Congress and in the Administration for a more holistic U S  data privacy policy  The United States has played an important role in international discussions on privacy and data flows, such as in the OECD, G-20, and APEC, and has included provisions on these subjects in recent free trade agreements  Congress noted the importance of digital trade and the internet as a trading platform in setting the current U S  trade negotiating objectives in the June 2015 Trade Promotion Authority (TPA) legislation ( P L  114-26 )  TPA includes a specific principal U S  trade negotiating objective on "digital trade in goods and services and cross-border data flows " According to TPA, a trade agreement should ensure that governments "refrain from implementing trade-related measures that impede digital trade in goods and services, restrict cross-border data flows, or require local storage or processing of data " However, TPA also recognizes that sometimes measures are necessary to achieve legitimate policy objectives and aims for such regulations to be the least trade restrictive, nondiscriminatory, and transparent  Comprehensive and Progressive Agreement for Trans‐Pacific Partnership (CPTPP /TPP-11 )   The CPTPP is a recently concluded trade agreement among 11 Asia-Pacific countries  The CPTPP is based on the proposed Trans-Pacific Partnership (TPP) agreement negotiated by the Obama Administration and from which President Trump withdrew the United States in January 2017  The electronic commerce chapter in TPP, left unchanged in CPTPP, contains the strongest binding trade agreement commitments on digital trade in force globally  CPTPP includes provisions on cross-border data flows and personal information protection  The text specifically states that the parties "shall allow the cross-border transfer of information " The agreement allows restrictive measures for legitimate public policy purposes if they are not discriminatory or disguised trade barriers  The agreement also prohibits localization requirements for computing facilities, with similar exceptions  On privacy, the CPTPP requires parties to have a legal framework in place to protect personal information and to have consumer protection laws that cover online commerce  It encourages interoperability between data privacy regimes and encourages cooperation between consumer protection authorities  United States-Mexico-Canada Agreement (USMCA)  The released text for the proposed USMCA aims to revise and update the trilateral North American Free Trade Agreement (NAFTA), and illustrates the Trump Administration's approach  The USMCA chapter 19 on digital trade includes articles on consumer protection, personal information protection, cross-border transfer of information by electronic means, and cybersecurity, among other topics  Building on the TPP, the agreement seeks to balance the legitimate objectives by requiring parties to have a legal framework to protect personal information, have consumer protection laws for online commercial activities, and not prohibit or restrict cross-border transfer of information  While the agreement does not prescribe specific rules or measures that a party must take to protect privacy, it goes further than the TPP (or CPTPP) provisions and provides guidance to inform a country's privacy regime  In particular, the USMCA explicitly refers to the APEC Privacy Framework and OECD Guidelines as relevant and identifies key principles  In general, the proposed USMCA requires that parties not restrict cross-border data flows  Governments are allowed to do so to achieve a legitimate public policy objective (e g , privacy, national security), provided the measure is not arbitrary, discriminatory, a disguised trade barrier, or greater than necessary to achieve the particular objective  In this way, the parties seek to balance the free flow of data for commerce and communication with protecting privacy and security  The agreement specifically states that the parties may take different legal approaches to protect personal data and also recognizes APEC CBPR as a "valid mechanism to facilitate cross-border information transfer while protecting personal information " The agreement aims to increase cooperation between the United States, Mexico, and Canada on a number of digital trade issues, including exchanging information on personal information protection and enforcement experiences; strengthening collaboration on cybersecurity issues; and promoting the APEC CBPR and global interoperability of national privacy regimes  The governments also commit to encourage private-sector self-regulation models and promote cooperation to enforce privacy laws  While the agreement is only between three parties, the provisions are written broadly to encompass global efforts  Some stakeholders look at USMCA as the basis for potential future trade agreements (such as with the UK)  Cross-border data flows will likely be a key issue in future U S -EU trade negotiations  The United States has articulated a clear position on data privacy in trade agreements; however, there is no single U S  data privacy policy  Nevertheless, the Trump Administration is seeking to define an overarching U S  policy on data privacy  The Trump Administration's ongoing three-track process is being managed by the Department of Commerce (Commerce) in consultation with the White House  Different bureaus in Commerce are tasked with different aspects of the process, as follows  1  The National Institutes of Standards and Technology (NIST) is developing a privacy framework  Similar to its cybersecurity framework, NIST aims to create a voluntary framework as a tool for organizations to adopt to identify, assess, manage, and communicate about privacy risks  By classifying specific privacy outcomes and potential approaches, the framework is intended to enable organizations to create and adapt privacy strategies, innovate, and manage privacy risks within diverse environments  As part of its transparent approach, NIST is currently consulting with public- and private-sector stakeholders through various forms of outreach to collect feedback and aims to have a draft framework before the end of 2019  2  The National Telecommunications and Information Administration (NTIA) is developing a set of privacy principles to guide a domestic legal and policy approach  The NITA sought public comment on a proposed set of "user-centric privacy outcomes" and a set of high-level goals  3  The International Trade Administration (ITA) engages with foreign governments and international organizations such as APEC  ITA is focusing on the international interoperability aspects of potential U S  privacy policy  ITA's role is to ensure that the NIST and NTIA approaches are consistent with U S  international policy objectives, including TPA, and principles, such as the OECD framework and APEC CBPRs  Like the EU and China, Commerce is seeking input through a public- and private-sector consultation process  However, unlike the EU or China, Commerce is expecting to create a voluntary privacy framework  Some observers question whether the Commerce approach is sufficient to result in strong privacy protections if it is not backed up by congressional action and federal legislation  Some suggest that Congress could lead a whole-of-government approach through new federal legislation  In the 115 th Congress, then-House Committee on Energy and Commerce Ranking Member Frank Pallone, Jr  requested that the Government Accountability Office (GAO) examine issues related to federal oversight of internet privacy  The January 2019 GAO report concluded that now is "an appropriate time for Congress to consider comprehensive Internet privacy " GAO stated that "Congress should consider developing comprehensive legislation on Internet privacy that would enhance consumer protections and provide flexibility to address a rapidly evolving Internet environment  Issues that should be considered include what authorities agencies should have in order to oversee Internet privacy, including appropriate rulemaking authority " Recognizing the importance of protecting open data flows amid growing concerns about online privacy, some stakeholders seek to influence U S  policies on these issues  In addition to submitting comments in response to NTIA and NIST requests and participating in their forums, multiple organizations issued their own sets of principles or guidelines, some referencing the EU GDPR  The U S  Chamber of Commerce has also published model privacy legislation for Congress to consider  Though they vary in emphasis, these proposals share common themes: transparency on what data is being collected and how it is being used; user control, including the ability to opt out of sharing at least some information and to access and correct personal data collected; data security measures, like data breach notification requirements; and enforcement by the FTC; FTC commissioners also voiced support for the agency as the appropriate federal enforcer for consumer privacy  But these groups also differ in some areas, such as whether, or to what extent, to include certain aspects included in the GDPR, such as the right to deletion (so-called "right to be forgotten"), requirements for data minimization, or extraterritorial reach  There is not consensus on whether the FTC should be given rule-making authority or additional resources, the enforcement role of states, or if an independent data protection commission is needed similar to EU DPAs  Consistent with U S  trade policy, industry groups generally point out the need to be flexible, encourage private-sector innovation, establish sector- and technology-neutral rules, create international interoperability between privacy regimes, and facilitate cross-border data flows  Private-sector stakeholders generally want to avoid what they regard as overregulation or high compliance burdens  These groups emphasize risk management and a harm-based approach, which they state keeps an organization's costs proportional to the consumer harm prevented  On the other hand, some consumer advocates point to a need for baseline obligations to protect against discrimination, disinformation, or other harm  In general, consumer advocates believe that any comprehensive federal privacy policy should complement, and not supplant, sector-specific privacy legislation or state-level legislation  Finding a global consensus on how to balance open data flows and privacy protection may be key to maintaining trust in the digital environment and advancing international trade  One study found that over 120 countries have laws related to personal data protection  Divergent national privacy approaches raise the costs of doing business and make it harder for governments to collaborate and share data, whether for scientific research, defense, or law enforcement  A system for global interoperability in a least trade-restrictive and nondiscriminatory way between different national systems could help minimize costs and allow entities in different jurisdictions with varying online privacy regimes to share data via cross-border data flows  Such a system could help avoid fragmentation of the internet between European, Chinese, and American spheres, a danger that some analysts have warned against  For example, Figure 2 suggests the potential of an interoperability system that allows data to flow freely between GDPR- and CBPR-certified economies  The OECD guidelines, G-20 principles, APEC CBPR, CPTPP, and USMCA provisions demonstrate an evolving understanding on how to balance cross-border data flows, security, and privacy, to create interoperable policies that can be tailored by countries and avoid fragmentation or the potential exclusion of other countries or regulatory systems  The various trade agreements and initiatives with differing sets of parties may ultimately pave the way for a broader multilateral understanding and eventually lead to more enforceable binding commitments founded on the key WTO principles of nondiscrimination, least trade restrictiveness, and transparency  Congress may consider the trade-related aspects of data flows in trade agreements, including through close examination of these provisions during the congressional debate and consideration of legislation to implement the proposed USMCA  Issues include whether the agreements make progress in meeting TPA's related trade negotiating objectives and if the provisions strike the appropriate balance among public policy objectives  In addition, USTR's specific trade negotiating objectives for future agreements with the EU and Japan include establishing rules to protect cross-border data flows  These future trade negotiations present challenges and provide opportunities for Congress to further engage USTR on the issues and to conduct oversight  Congress may further consider how best to achieve broader consensus on data flows and privacy at the global level  Congress could, for example, conduct additional oversight of current best practice approaches (e g , OECD, APEC) or ongoing negotiations in the WTO on e-commerce to create rules through plurilateral or multilateral agreements  Congress may consider endorsing certain of these efforts to influence international discussions and the engagement of other countries  Congress may want to examine the potential challenges and implications of building a system of interoperability between APEC, CBPR, and the EU GDPR  Related issues are the extent to which the EU is establishing its system as a potential de facto global approach through its trade agreements and other mechanisms, and how U S  and other trade agreements may ultimately provide approaches that could be adopted more globally  Congress may seek to better understand the economic impact of data flows and privacy regimes in other countries related to U S  access to other markets and the extent to which barriers are being put in place that may discriminate against U S  exporters  Congress may examine the lack of reciprocal treatment and limits on U S  firms' access to some foreign markets  Congress may consider the implications of not having a comprehensive national data privacy policy  Will the EU GDPR and China cybersecurity policies become the global norms that other countries follow in the absence of a clear U S  alternative? Congress may enact comprehensive privacy legislation  In considering such action, Congress could investigate and conduct oversight of the Administration's ongoing privacy efforts, including requesting briefings and updates on the NTIA, NIST, and ITA initiatives to provide congressional feedback and direction and ensure they are aligned with U S  trade objectives  Congress may also seek input from other federal agencies  In deliberating a comprehensive U S  policy on personal data privacy, Congress may review the GAO report's findings and conclusions  Congress may also weigh several factors, including: How can U S  trade and domestic policy achieve the appropriate balance to encourage cross-border commerce, economic growth, and innovation, while safeguarding individual privacy and national security? How would a new privacy regime affect U S  consumers and businesses, including large multinationals who must comply with different national privacy regimes and small- and medium-sized enterprises with limited resources and technology expertise? Do U S  agencies have the needed tools to accurately assess the size and scope of cross-border data flows to help analyze the economic impact of different privacy policies, or measure the costs of trade barriers? How should an evolving U S  privacy regime align with U S  trade policy objectives and evolving international standards, such as the OECD Guidelines for privacy and cybersecurity, and should U S  policymakers prioritize interoperability with other international privacy frameworks to avoid further fragmentation of global markets and so-called balkanization of the internet? In addition, there are a host of other policy considerations not directly related to trade 


Report 2: Medicare is a federal program that pays for covered health care services of qualified beneficiaries  It was established in 1965 under Title XVIII of the Social Security Act to provide health insurance to individuals 65 and older, and has been expanded over the years to include permanently disabled individuals under 65  The program is administered by the Centers for Medicare & Medicaid Services (CMS), within the U S  Department of Health and Human Services (HHS)  Medicare consists of four distinct parts: Part A (Hospital Insurance, or HI) covers inpatient hospital services, skilled nursing care, hospice care, and some home health services  The HI trust fund is mainly funded by a dedicated payroll tax of 2 9% of earnings, shared equally between employers and workers  Since 2013, workers with income of more than $200,000 per year for single tax filers (or more than $250,000 for joint tax filers) pay an additional 0 9% on income over those amounts  Part B (Supplementary Medical Insurance, or SMI) covers physician services, outpatient services, and some home health and preventive services  The SMI trust fund is funded through beneficiary premiums (set at 25% of estimated program costs for the aged) and general revenues (the remaining amount, approximately 75%)  Part C (Medicare Advantage, or MA) is a private plan option for beneficiaries that covers all Parts A and B services, except hospice  Individuals choosing to enroll in Part C must also enroll in Part B  Part C is funded through the HI and SMI trust funds  Part D covers outpatient prescription drug benefits  Funding is included in the SMI trust fund and is financed through beneficiary premiums, general revenues, and state transfer payments  Medicare serves approximately one in six Americans and virtually all of the population aged 65 and older  In 2019, the program will cover an estimated 61 million persons (52 million aged and 9 million disabled)  The Congressional Budget Office (CBO) estimates that total Medicare spending in 2019 will be about $772 billion; of this amount, approximately $749 billion will be spent on benefits  About 28% of Medicare benefit spending is for hospital inpatient and hospital outpatient services (see Figure 1 )  CBO also estimates that federal Medicare spending (after deduction of beneficiary premiums and other offsetting receipts) will be about $637 billion in 2019, accounting for about 14% of total federal spending and 3% of GDP  Medicare is required to pay for all covered services provided to eligible persons, so long as specific criteria are met  Spending under the program (except for a portion of administrative costs) is considered mandatory spending and is not subject to the appropriations process  Medicare is expected to be a high-priority issue in the current Congress  The program has a significant impact on beneficiaries and other stakeholders as well as on the economy in general through its coverage of important health care benefits for the aged and disabled, the payment of premiums and other cost sharing by those beneficiaries, its payments to providers who supply those health care services, and its interaction with other insurance coverage  Projections of future Medicare expenditures and funding indicate that the program will place increasing financial demands on the federal budget and on beneficiaries  In response to these concerns, Congress may consider a range of Medicare reform options, from making changes within the current structure, including modifying provider payments and revising existing oversight and regulatory mechanisms, to restructuring the entire program  The committees of jurisdiction for the mandatory spending (benefits) portion of Medicare are the Senate Committee on Finance, the House Committee on Ways and Means, and the House Committee on Energy and Commerce  The House and Senate Committees on Appropriations have jurisdiction over the discretionary spending used to administer and oversee the program  Medicare was enacted in 1965 (P L  89-97) in response to the concern that only about half of the nation's seniors had health insurance, and most of those had coverage only for inpatient hospital costs  The new program, which became effective July 1, 1966, included Part A coverage for hospital and posthospital services and Part B coverage for doctors and other medical services  As is the case for the Social Security program, Part A is financed by payroll taxes levied on current workers and their employers; persons must pay into the system for 40 quarters to become entitled to premium-free benefits  Medicare Part B is voluntary, with a monthly premium required of beneficiaries who choose to enroll  Payments to health care providers under both Part A and Part B were originally based on the most common form of payment at the time, namely "reasonable costs" for hospital and other institutional services or "usual, customary and reasonable charges" for physicians and other medical services  Medicare is considered a social insurance program and is the second-largest such federal program, after Social Security  The 1965 law also established Medicaid, the federal/state health insurance program for the poor; this was an expansion of previous welfare-based assistance programs  Some low-income individuals qualify for both Medicare and Medicaid  In the ensuing years, Medicare has undergone considerable change  P L  92-603, enacted in 1972, expanded program coverage to certain individuals under 65 (the disabled and persons with end-stage renal disease (ESRD)), and introduced managed care into Medicare by allowing private insurance entities to provide Medicare benefits in exchange for a monthly capitated payment  This law also began to place limitations on the definitions of reasonable costs and charges in order to gain some control over program spending which, even initially, exceeded original projections  During the 1980s and 1990s, a number of laws were enacted that included provisions designed to further stem the rapid increase in program spending through modifications to the way payments to providers were determined, and to postpone the insolvency of the Medicare Part A trust fund  This was typically achieved through tightening rules governing payments to providers of services and limiting the annual updates in such payments  The program moved from payments based on reasonable costs and reasonable charges to payment systems under which a predetermined payment amount was established for a specified unit of service  At the same time, beneficiaries were given expanded options to obtain covered services through private managed care arrangements, typically health maintenance organizations (HMOs)  Most Medicare payment provisions were incorporated into larger budget reconciliation bills designed to control overall federal spending  This effort culminated in the enactment of the Balanced Budget Act of 1997 (BBA 97; P L  105-33 )  This law slowed the rate of growth in payments to providers and established new payment systems for certain categories of providers, including establishing the sustainable growth rate (SGR) methodology for determining the annual update to Medicare physician payments  It also established the Medicare+Choice program, which expanded private plan options for beneficiaries and changed the way most of these plans were paid  BBA 97 further expanded preventive services covered by the program  Subsequently, Congress became concerned that the BBA 97 cuts in payments to providers were somewhat larger than originally anticipated  Therefore, legislation was enacted in both 1999 (Balanced Budget Refinement Act of 1999, or BBRA; P L  106-113 ) and 2000 (Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000, or BIPA; P L  106-554 ) to mitigate the impact of BBA 97 on providers  In 2003, Congress enacted the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA; P L  108-173 ), which included a major benefit expansion and placed increasing emphasis on the private sector to deliver and manage benefits  The MMA included provisions that (1) created a new voluntary outpatient prescription drug benefit to be administered by private entities; (2) replaced the Medicare+Choice program with the Medicare Advantage (MA) program and raised payments to plans in order to increase their availability for beneficiaries; (3) introduced the concept of income testing into Medicare, with higher-income persons paying larger Part B premiums beginning in 2007; (4) modified some provider payment rules; (5) expanded covered preventive services; and (6) created a specific process for overall program review if general revenue spending exceeded a specified threshold  During the 109 th Congress, two laws were enacted that incorporated minor modifications to Medicare's payment rules  These were the Deficit Reduction Act of 2005 (DRA; P L  109-171 ) and the Tax Relief and Health Care Act of 2006 (TRHCA; P L  109-432 )  In the 110 th Congress, additional changes were incorporated in the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA; P L  110-173 ) and the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA; P L  110-275 )  In the 111 th Congress, comprehensive health reform legislation was enacted that, among other things, made statutory changes to the Medicare program  The Patient Protection and Affordable Care Act (ACA; P L  111-148 ), enacted on March 23, 2010, included numerous provisions affecting Medicare payments, payment rules, covered benefits, and the delivery of care  The Health Care and Education Affordability Reconciliation Act of 2010 (the Reconciliation Act, or HCERA; P L  111-152 ), enacted on March 30, 2010, made changes to a number of Medicare-related provisions in the ACA and added several new provisions  Included in the ACA, as amended, are provisions that (1) constrain Medicare's annual payment increases for certain providers; (2) change payment rates in the MA program so that they more closely resemble those in fee-for-service; (3) reduce payments to hospitals that serve a large number of low-income patients; (4) create an Independent Payment Advisory Board (IPAB) to make recommendations to adjust Medicare payment rates; (5) phase out the Part D prescription drug benefit "doughnut hole"; (6) increase resources and enhance activities to prevent fraud and abuse; and (7) provide incentives to increase the quality and efficiency of care, such as creating value-based purchasing programs for certain types of providers, allowing accountable care organizations (ACOs) that meet certain quality and efficiency standards to share in the savings, creating a voluntary pilot program that bundles payments for physician, hospital, and post-acute care services, and adjusting payments to hospitals for readmissions related to certain potentially preventable conditions  In the 112 th and 113 th Congresses, the American Taxpayer Relief Act of 2012 (ATRA; P L  112-240 ), the Continuing Appropriations Resolution of 2014 ( P L  113-67 ), and the Protecting Access to Medicare Act of 2014 (PAMA; P L  113-93 ) primarily made short-term modifications to physician payment updates and payment adjustments for certain types of providers  PAMA also established a new skilled nursing facility (SNF) value-based purchasing program and a new system for determining payments for clinical diagnostic laboratory tests  The Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT; P L  113-185 ) required that post-acute care providers—defined in the law as long-term care hospitals (LTCHs), inpatient rehabilitation facilities (IRFs), SNFs, and home health agencies (HHAs)—report standardized patient assessment data and data on quality measures and resource use  IMPACT also modified the annual update to the hospice aggregate payment cap and required that hospices be reviewed every three years to ensure that they are compliant with existing regulations related to patient health and safety and quality of care  In the 114 th Congress, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA; P L  114-10 ) repealed the SGR formula for calculating updates to Medicare payment rates to physicians and other practitioners and established an alternative set of methods for determining the annual updates   MACRA also introduced alternatives to the current fee-for-service (FFS) based physician payments by creating a new merit-based incentive payment system (MIPS) and put in place processes for developing, evaluating, and adopting alternative payment models (APMs)  Additionally, MACRA reduced updates to hospital and post-acute care provider payments, extended several expiring provider payment adjustments, made adjustments to income-related premiums in Parts B and D, and prohibited using Social Security numbers on beneficiaries' Medicare cards  Among other changes, the Increasing Choice, Access, and Quality in Health Care for Americans Act (Division C of the 21 st Century Cures Act; P L  114-255 ) made adjustments to LTCH reimbursement and modified the average length of stay criteria, which determines whether a hospital qualifies as an LTCH  It also delayed payment reductions and required the Secretary of Health and Human Services (the Secretary) to make changes to how payments are determined for certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS)  Lastly, it allowed beneficiaries with ESRD to enroll in MA beginning January 1, 2021  In the 115 th Congress, the Bipartisan Budget Act of 2018 (BBA 18; P L  115-123 ) made a number of changes to federal health care programs, including Medicare  For example, BBA 18 included provisions designed to expand care for beneficiaries with chronic health conditions, such as promoting team-based care by providers, increasing the use of telehealth services, and expanding certain MA supplemental benefits  In addition, BBA 18 extended for five years a number of existing Medicare provisions that were set to expire (or that had temporarily expired), including the Medicare dependent hospital program and add-on payments for low-volume hospitals, rural home health services, and certain ambulance services  BBA 18 also specified payment updates for the Medicare physician fee schedule, SNFs, and home health services; reduced payments for non-emergency ambulance transports; and required modification of the home health prospective payment system starting in 2020  In addition, the act provided for indefinite authority for MA special needs plans, repealed limits on outpatient therapy services, and eliminated the IPAB  Starting in 2019, the act will require that pharmaceutical manufacturers participating in Medicare Part D provide a larger discount on brand-name drugs purchased by enrollees in the coverage gap and will create a new high-income premium category under Parts B and D  Most persons aged 65 or older are automatically entitled to premium-free Part A because they or their spouse paid Medicare payroll taxes for at least 40 quarters (about 10 years) on earnings covered by either the Social Security or the Railroad Retirement systems  Persons under the age of 65 who receive cash disability benefits from Social Security or the Railroad Retirement systems for at least 24 months are also entitled to Part A  (Since there is a five-month waiting period for cash payments, the Medicare waiting period is effectively 29 months ) The 24-month waiting period is waived for persons with amyotrophic lateral sclerosis (ALS, "Lou Gehrig's disease")  Individuals of any age with ESRD who receive dialysis on a regular basis or a kidney transplant are generally eligible for Medicare  Medicare coverage for individuals with ESRD usually starts the first day of the fourth month of dialysis treatments  In addition, individuals with one or more specified lung diseases or types of cancer who lived for six months during a certain period prior to diagnosis in an area subject to a public health emergency declaration by the Environmental Protection Agency (EPA) as of June 17, 2009, are also deemed entitled to benefits under Part A and eligible to enroll in Part B  Persons over the age of 65 who are not entitled to premium-free Part A may obtain coverage by paying a monthly premium ($437 in 2019) or, for persons with at least 30 quarters of covered employment, a reduced monthly premium ($240 in 2019)  In addition, disabled persons who lose their cash benefits solely because of higher earnings, and subsequently lose their extended Medicare coverage, may continue their Medicare enrollment by paying a premium, subject to limitations  Generally, enrollment in Medicare Part B is voluntary  All persons entitled to Part A (and persons over the age of 65 who are not entitled to premium-free Part A) may enroll in Part B by paying a monthly premium  In 2019, the monthly premium is $135 50; however, about 3 5% of Part B enrollees pay less, due to a "hold-harmless" provision in the Social Security Act  Since 2007, higher-income Part B enrollees pay higher premiums  (See " Part B Financing  ") Although enrollment in Part B is voluntary for most individuals, in most cases, those who enroll in Part A by paying a premium also must enroll in Part B  Additionally, ESRD beneficiaries and Medicare Advantage enrollees (discussed below) also must enroll in Part B  Together, Parts A and B of Medicare comprise "original Medicare," which covers benefits on a fee-for-service basis  Beneficiaries have another option for coverage through private plans, called the Medicare Advantage (MA or Part C) program  When beneficiaries first become eligible for Medicare, they may choose either original Medicare or they may enroll in a private MA plan  Each fall, there is an annual open enrollment period during which time Medicare beneficiaries may choose a different MA plan, or leave or join the MA program  Beneficiaries are to receive information about their options to help them make informed decisions  In 2019, the annual open enrollment period runs from October 15 to December 7 for plan choices starting the following January  Since 2012, MA plans with a 5-star quality rating have been allowed to enroll Medicare beneficiaries who are either in traditional Medicare or in an MA plan with a lower quality rating at any time  Finally, each individual enrolled in either Part A or Part B is also entitled to obtain qualified prescription drug coverage through enrollment in a Part D prescription drug plan  Similar to Part B, enrollment in Part D is voluntary and the beneficiary pays a monthly premium  Since 2011, some higher-income enrollees pay higher premiums, similar to enrollees in Part B  Generally, beneficiaries enrolled in an MA plan providing qualified prescription drug coverage (MA-PD plan) must obtain their prescription drug coverage through that plan  In general, individuals who do not enroll in Part B or Part D during an initial enrollment period (when they first become eligible for Medicare) must pay a permanent penalty of increased monthly premiums if they choose to enroll at a later date  Individuals who do not enroll in Part B during their initial enrollment period may enroll only during the annual general enrollment period, which occurs from January 1 to March 31 each year  Coverage begins the following July 1  However, the law waives the Part B late enrollment penalty for current workers who have primary coverage through their own or a spouse's employer-sponsored plan  These individuals have a special enrollment period once their employment ends; as long as they enroll in Part B during this time, they will not be subject to penalty  Individuals who do not enroll in Part D during their initial enrollment period may enroll during the annual open enrollment period, which corresponds with the Part C annual enrollment period—from October 15 to December 7, with coverage effective the following January  Individuals are not subject to the Part D penalty if they have maintained "creditable" drug coverage through another source, such as retiree health coverage offered by a former employer or union  However, once employees retire or have no access to "creditable" Part D coverage, a penalty will apply unless they sign up for coverage during a special enrollment period  Finally, for persons who qualify for the low-income subsidy for Part D, the delayed-enrollment penalty does not apply  Medicare Parts A, B, and D each cover different services, with Part C providing a private plan alternative for all Medicare services covered under Parts A and B, except hospice  The Parts A-D covered services are described below, along with a description of Medicare's payments  Part A provides coverage for inpatient hospital services, posthospital skilled nursing facility (SNF) services, hospice care, and some home health services, subject to certain conditions and limitations  Approximately 20% of fee-for-service enrollees use Part A services during a year  Medicare inpatient hospital services include (1) bed and board; (2) nursing services; (3) use of hospital facilities; (4) drugs, biologics, supplies, appliances, and equipment; and (5) diagnostic and therapeutic items and services  (Physicians' services provided during an inpatient stay are paid under the physician fee schedule and discussed below in the " Physicians and Nonphysician Practitioner Services " section ) Coverage for inpatient services is linked to an individual's benefit period or "spell of illness" (defined as beginning on the day a patient enters a hospital and ending when he or she has not been in a hospital or skilled nursing facility for 60 days)  An individual admitted to a hospital more than 60 days after the last discharge from a hospital or SNF begins a new benefit period  Coverage in each benefit period is subject to the following conditions: Days 1-60  Beneficiary pays a deductible ($1,364 in 2019)  Days 61-90  Beneficiary pays a daily co-payment charge ($341 in 2019)  Days 91-150  After 90 days, the beneficiary may draw on one or more of 60 lifetime reserve days, provided they have not been previously used  (Each of the 60 lifetime reserve days can be used only once during an individual's lifetime ) For lifetime reserve days, the beneficiary pays a daily co-payment charge ($682 in 2019); otherwise the beneficiary pays all costs  Days 151 and over  Beneficiary pays for all costs for these days  Inpatient mental health care in a psychiatric facility is limited to 190 days during a patient's lifetime  Cost sharing is structured similarly to that for stays in a general hospital (above)  Medicare makes payments to most acute care hospitals under the inpatient prospective payment system (IPPS), using a prospectively determined amount for each discharge  Medicare's payments to hospitals is the product of two components: (1) a discharge payment amount adjusted by a wage index for the area where the hospital is located or where it has been reclassified, and (2) the weight associated with the Medicare severity-diagnosis related group (MS-DRG) to which the patient is assigned  This weight reflects the relative costliness of the average patient in that MS-DRG, which is revised annually, generally effective October 1 st of each year  Additional payments are made to hospitals for cases with extraordinary costs (outliers), for indirect costs incurred by teaching hospitals for graduate medical education, and to disproportionate share hospitals (DSH) which provide a certain volume of care to low-income patients  Additional payments may also be made for qualified new technologies that have been approved for special add-on payments  Medicare also makes payments outside the IPPS system for direct costs associated with graduate medical education (GME) for hospital residents, subject to certain limits  In addition, Medicare pays hospitals for 65% of the allowable costs associated with beneficiaries' unpaid deductible and co-payment amounts as well as for the costs for certain other services  IPPS payments may be reduced by certain quality-related programs based on a hospital's quality performance  These quality-related programs include the Hospital Readmissions Reduction Program, the Hospital-Acquired Condition Reduction Program, and the Hospital Value-Based Purchasing Program  Further, hospitals may receive Medicare payment reductions for failing to demonstrate meaningful use of certified electronic health record (EHR) technology  Additional payment adjustments or special treatment under the IPPS may apply for hospitals meeting one of the following designations: (1) sole community hospitals (SCHs), (2) Medicare dependent hospitals, (3) rural referral centers, and (4) low-volume hospitals  Certain hospitals or distinct hospital units are exempt from IPPS and paid on an alternative basis, including (1) inpatient rehabilitation facilities, (2) long-term care hospitals, (3) psychiatric facilities including hospitals and distinct part units, (4) children's hospitals, (5) cancer hospitals, and (6) critical access hospitals  Medicare covers up to 100 days of posthospital care for persons needing skilled nursing or rehabilitation services on a daily basis  The SNF stay must be preceded by an inpatient hospital stay of at least 3 consecutive calendar days, and the transfer to the SNF typically must occur within 30 days of the hospital discharge  Medicare requires SNFs to provide services for a condition the beneficiary was receiving treatment for during his or her qualifying hospital stay (or for an additional condition that arose while in the SNF)  There is no beneficiary cost sharing for the first 20 days of a Medicare-covered SNF stay  For days 21 to 100, beneficiaries are subject to daily co-payment charges ($170 50 in 2019)  The 100-day limit begins again with a new spell of illness  SNF services are paid under a prospective payment system (PPS), which is based on a per diem urban or rural base payment rate, adjusted for case mix (average severity of illness) and area wages  The per diem rate generally covers all services, including room and board, provided to the patient that day  The case-mix adjustment is made using the resource utilization groups (RUGs) classification system, which uses patient assessments to assign a beneficiary to one of 66 groups that reflect the beneficiary's expected use of services  Patient assessments are done at various times during a patient's stay and a beneficiary's designated RUG category can change with changes in the beneficiary's condition  Extra payments are not made for extraordinarily costly cases ("outliers")  The Medicare hospice benefit covers services designed to provide palliative care and management of a terminal illness; the benefit includes drugs and medical and support services  These services are provided to Medicare beneficiaries with a life expectancy of six months or less for two 90-day periods, followed by an unlimited number of 60-day periods  The individual's attending physician and the hospice physician must certify the need for the first benefit period, but only the hospice physician needs to recertify for subsequent periods  Since January 1, 2011, a hospice physician or nurse practitioner must have a face-to-face encounter with the individual to determine continued eligibility prior to the 180 th day recertification, and for each subsequent recertification  Hospice care is provided in lieu of most other Medicare services related to the curative treatment of the terminal illness  Beneficiaries electing hospice care from a hospice program may receive curative services for illnesses or injuries unrelated to their terminal illness, and they may disenroll from the hospice at any time  Nominal cost sharing is required for drugs and respite care  Payment for hospice care is based on one of four prospectively determined rates (which correspond to four different levels of care) for each day a beneficiary is under the care of the hospice  The four rate categories are routine home care, continuous home care, inpatient respite care, and general inpatient care  Payment rates are adjusted to reflect differences in area wage levels, using the hospital wage index  Payments to a hospice are limited by two caps; the first limits the number of days of inpatient care to 20% or less of total patient care days, and the second limits the average annual payment per beneficiary  Home health services and services for individuals with end-stage renal disease are covered under both Parts A and B of Medicare  Medicare covers visits by participating home health agencies for beneficiaries who (1) are confined to home and (2) need either skilled nursing care on an intermittent basis or physical or speech language therapy  After establishing such eligibility, the continuing need for occupational therapy services may extend the eligibility period  Covered services include part-time or intermittent nursing care, physical or occupational therapy or speech language pathology services, medical social services, home health aide services, and medical supplies and durable medical equipment  The services must be provided under a plan of care established by a physician, and the plan must be reviewed by the physician at least every 60 days  There is no beneficiary cost sharing for home health services (though some other Part B services provided in connection with the visit, such as durable medical equipment, may be subject to cost-sharing charges)  Home health services are covered under both Medicare Parts A and B  There are special eligibility requirements and benefit limits for home health services furnished under Part A to beneficiaries who are enrolled in both Parts A and B  For such a beneficiary, Part A pays for only postinstitutional home health services furnished for up to 100 visits during a spell of illness, while Part B covers any medically necessary home health services that exceed the 100-visit limit, as well as medically necessary home health services that do not qualify as "postinstitutional " For beneficiaries enrolled in only Part A or only Part B, the requirements described above do not apply  Part A or Part B, as applicable, covers all medically necessary episodes of home health care, without a visit limit, regardless of whether the episode follows a hospitalization  Regardless of whether the beneficiary is enrolled in Part A only, in Part B only, or in both parts, the scope of the Medicare home health benefit is the same, Medicare's payments to HHAs are calculated using the same methods, and beneficiaries have no cost-sharing  Home health services are paid under a home health PPS, based on 60-day episodes of care; a patient may have an unlimited number of episodes  The physician's certification of an initial 60-day episode of home health must be supported by a face-to-face encounter with the patient related to the primary reason that the patient needs home health services  Under the PPS, for episodes with five or greater visits, a nationwide base payment amount is adjusted by differences in wages (using the hospital wage index)  This amount is then adjusted for case mix using the applicable Home Health Resource Group (HHRG) to which the beneficiary has been assigned  The HHRG applicable to a beneficiary is determined following an assessment of the patient's condition and care needs using the Outcome and Assessment Information Set (OASIS); there are 153 HHRGs  For episodes with four or fewer visits, the PPS reimburses the provider for each visit performed  Further payment adjustments may be made for services provided in rural areas, outlier visits (for extremely costly patients), a partial episode for beneficiaries that have an intervening event during their episode, or an agency's failure to submit quality data to CMS  Since January 1, 2016, home health agencies in nine states are being reimbursed under a home health value-based purchasing (HHVBP) model  These home health agencies can receive increased or decreased home health reimbursements depending on their performance across certain quality measures  Individuals with end-stage renal disease (ESRD) are eligible for all services covered under Parts A and B  Kidney transplantation services, to the extent they are inpatient hospital services, are subject to the inpatient hospital PPS and are reimbursed by both Parts A and B  However, kidney acquisition costs are paid on a reasonable cost basis under Part A  Dialysis treatments, when an individual is admitted to a hospital, are covered under Part A  Part B covers their dialysis services, drugs, biologicals (including erythropoiesis stimulating agents used in treating anemia as a result of ESRD), diagnostic laboratory tests, and other items and services furnished to individuals for the treatment of ESRD  In effect since January 1, 2011, the ESRD prospective payment system (PPS) makes no payment distinction as to the site where renal dialysis services are provided  With the implementation of the ESRD PPS, Medicare dialysis payments provide a single "bundled" payment for Medicare renal dialysis services that includes (1) items and services included in the former payment system's base rate as of December 31, 2010; (2) erythropoiesis stimulating agents (ESAs) for the treatment of ESRD; (3) other drugs and biologicals for which payment was made separately (before bundling); and (4) diagnostic laboratory tests and other items and services furnished to individuals for the treatment of ESRD  The system is case-mix adjusted based on factors such as patient weight, body mass index, comorbidities, length of time on dialysis, age, race, ethnicity, and other appropriate factors as determined by the Secretary  Under the ESRD Quality Incentive Program, dialysis facilities that fail to meet certain performance standards receive reduced payments  Medicare Part B covers physicians' services, outpatient hospital services, durable medical equipment, and other medical services  Initially, over 98% of the eligible population voluntarily enrolled in Part B, but in recent years the percentage has fallen to about 91%  About 89% of enrollees in original (FFS) Medicare use Part B services during a year  The program generally pays 80% of the approved amount (most commonly, a fee schedule or other predetermined amount) for covered services in excess of the annual deductible ($185 in 2019)  The beneficiary is liable for the remaining 20%  Most providers and practitioners are subject to limits on amounts they can bill beneficiaries for covered services  For example, physicians and some other practitioners may choose whether or not to accept "assignment" on a claim  When a physician signs a binding agreement to accept assignment for all Medicare patients, the physician accepts the Medicare payment amount as payment in full and can bill the beneficiary only the 20% coinsurance plus any unmet deductible  The physician agrees to accept assignment on all Medicare claims in a given year and is referred to as a "participating physician " There are several advantages to being a participating provider, including higher payment under the Medicare fee schedule, a lower beneficiary co-payment, and automatic forwarding of Medigap claims  Physicians who do not agree to accept assignment on all Medicare claims in a given year are referred to as nonparticipating physicians  Nonparticipating physicians may or may not accept assignment for a given service  If they do not, they may charge beneficiaries more than the fee schedule amount on nonassigned claims; however, these "balance billing" charges are subject to certain limits  Alternatively, physicians may choose not to accept any Medicare payment and enter into private contracts with their patients where no Medicare restrictions on payment or balance billing apply; however, this requires that physicians "opt out" of Medicare for two years  For some providers, such as nurse practitioners and physician assistants, assignment is mandatory; these providers can only bill the beneficiary the 20% coinsurance and any unmet deductible  For other Part B services, such as durable medical equipment, assignment is optional; for these services, applicable providers may bill beneficiaries for amounts above Medicare's recognized payment level and may do so without limit  Medicare Part B covers medically necessary physician services and medical services provided by some nonphysician practitioners  Covered nonphysician practitioner services include, but are not limited to, those provided by physician assistants, nurse practitioners, certified registered nurse anesthetists, and clinical social workers  Certain limitations apply for services provided by chiropractors and podiatrists  Beneficiary cost sharing is typically 20% of the approved amount, although most preventive services require no coinsurance from the beneficiary  A number of Part B services are paid under the Medicare physician fee schedule (MPFS), including services of physicians, nonphysician practitioners, and therapists  There are over 7,000 service codes under the MPFS  The fee schedule assigns relative values to each service code  These relative values reflect physician work (based on time, skill, and intensity involved), practice expenses (e g , overhead and nonphysician labor), and malpractice expenses  The relative values are adjusted for geographic variations in the costs of practicing medicine  These geographically adjusted relative values are converted into a dollar payment amount by a national conversion factor  Annual updates to payments are determined through changes in the conversion factor  MACRA made several fundamental changes to how Medicare pays for physician and practitioner services by (1) changing the methodology for determining the annual updates to the conversion factor, (2) establishing a merit-based incentive payment system (MIPS) to consolidate and replace several existing incentive programs and to apply value and quality adjustments to the MPFS, and (3) establishing the development of, and participation in, alternative payment models (APMs)  Prior to MACRA, the SGR system, which had been in place since BBA 97, tied annual updates to the Medicare fee schedule to cumulative Part B expenditure targets  MACRA repealed the SGR methodology, established annual fee schedule updates in the short term, and put in place a new method for determining updates thereafter  As a result of the MACRA changes, the update to physician payments under the MPFS was 0% from January 2015 through June 2015; for the remainder of that year—July 2015 through December 2015—the payments were increased by 0 5%  In each of the next four years, 2016 through 2019, the payments were to increase by 0 5% each year; however, the BBA 18 reduced the 2019 update to 0 25%  For the next six years, from 2020 through 2025, the payment update will be 0%  In addition to changes to the annual update, MACRA established two pathways for payment reform, collectively referred to as the Quality Payment Program (QPP)  Medicare payment to all physicians and other practitioners will be determined by which conditions of the QPP, either MIPS or APM, the participant satisfies  The MIPS is a new program that remains based on FFS rates but combines four categories of performance measures (quality of care, cost/resource use, clinical practice improvement activities, and promoting interoperability) into a single adjustment to the base MPFS payment  Following several years of data collection and feedback on measures, the MIPS adjustments will affect actual payments for the first time in 2019  In contrast, qualified advanced APMs are intended to be alternatives to FFS, incorporating new approaches to paying for medical care that reward quality and efficiency while de-emphasizing the number of services billed (volume of care)  Proposed advanced APMs are evaluated by an ad hoc committee (the Physician-Focused Payment Models Technical Advisory Committee), which provides comments and recommendations to the Secretary as to whether new payment models meet the criteria of APMs  For 2019, there are 13 advanced APMs under the QPP, though not all are available to all physicians and practitioners, as some are restricted to certain special services (e g , oncology care, joint replacement) or geographic locations (e g , Vermont's Medicare ACO Initiative, Maryland's Total Cost of Care Model)  MACRA established incentives to make APMs more attractive than MIPS  First, qualifying participants in advanced APMs are eligible for an annual prepaid bonus (paid 2019-2024)  Second, beginning in 2026, there will be two update factors, one for items and services furnished by a participant in an advanced APM and another for those electing to remain in the modified FFS payment system (MIPS) that do not participate in an advanced APM  The update factor for the advanced APM participants will be 0 75%, and the update factor for MIPS will be 0 25%, causing a difference between the payment levels that will grow over time  Medicare covers medically necessary outpatient physical and occupational therapy and speech-language pathology services  Beginning in 1997 and for many years subsequently but intermittently, beneficiaries faced limits ( therapy caps ) on how much Medicare would pay for outpatient therapy services in a calendar year  BBA 18 permanently repealed the outpatient therapy caps beginning January 1, 2018, and established a requirement that therapy services exceeding $3,000 would trigger a manual medical review (MMR) of the medical necessity of these services, in years 2018-2028  Beginning with 2029, the annual MMR threshold limit is to be increased by the percentage increase in the MEI, and it is to be applied separately for (1) physical therapy services and speech-language pathology services combined and (2) occupational therapy services  Medicare statute prohibits payments for covered items and services that are "not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member," which would effectively exclude the coverage of preventive and screening services  However, Congress has explicitly added and expanded Medicare coverage for a number of such services through legislation, including through MMA, MIPPA, and ACA  Under current law, if a preventive service is recommended for use by the U S  Preventive Services Task Force (USPSTF, an independent evidence-review panel) and Medicare covers the service, all cost sharing must be waived  Also, the Secretary may add coverage of a USPSTF-recommended service that is not already covered  Coverage for preventive and screening services currently includes, among other services, (1) a "welcome to Medicare" physical exam during the first year of enrollment in Part B and an annual visit and prevention plan thereafter; (2) flu vaccine (annual), pneumococcal vaccine, and hepatitis B vaccine (for persons at high risk); (3) screening tests for breast, cervical, prostate, and colorectal cancers; (4) screening for other conditions such as depression, alcohol misuse, heart disease, glaucoma, and osteoporosis; and (5) intensive behavioral therapy for heart disease and for obesity  Payments for these services are provided under the physician fee schedule and/or the clinical laboratory fee schedule  Part B covers outpatient clinical laboratory tests, such as certain blood tests, urinalysis, and some screening tests, provided by Medicare-participating laboratories  These services may be furnished by labs located in hospitals and physician offices, as well as by independent labs  Beneficiaries have no co-payments or deductibles for covered clinical lab services  From 1984 until recently, payments for outpatient clinical laboratory services were made on the basis of the Medicare clinical laboratory fee schedule (CLFS), which set payment amounts as the lesser of the amount billed, the local fee for a geographic area, or a national limit amount  Most clinical lab services were paid at the national limit amount

ground_truth: "Cross-border data flows" refers to the movement or transfer of information between computer servers across national borders. Such data flows enable people to transmit information for online communication, track global supply chains, share research, provide cross-border services, and support technological innovation. Ensuring open cross-border data flows has been an objective of Congress in recent trade agreements and in broader U.S. international trade policy. The free flow of personal data, however, has raised security and privacy concerns. U.S. trade policy has traditionally sought to balance the need for cross-border data flows, which often include personal data, with online privacy and security. Some stakeholders, including some Members of Congress, believe that U.S. policy should better protect personal data privacy and security, and have introduced legislation to set a national policy. Other policymakers and analysts are concerned about increasing foreign barriers to U.S. digital trade, including data flows. Recent incidents of private information being shared or exposed have heightened public awareness of the risks posed to personal data stored online. Consumers' personal online data is valued by organizations for a variety of reasons, such as analyzing marketing information and easing the efficiency of transactions. Concerns are likely to grow as the amount of online data organizations collect and the level of global data flows expand. As Congress assesses policy options, it may further explore the link between cross-border data flows, online privacy, and trade policy; the trade implications of a comprehensive data privacy policy; and the U.S. role in establishing best practices and binding trade rules that seek to balance public policy priorities. There is no globally accepted standard or definition of data privacy in the online world, and there are no comprehensive binding multilateral rules specifically about cross-border data flows and privacy. Several international organizations, including the Organisation for Economic Co-operation and Development (OECD), G-20, and Asia-Pacific Economic Cooperation (APEC) forum, have sought to develop best practice guidelines or principles related to privacy and cross-border data flows, although none are legally binding. U.S. and other recent trade agreements are establishing new enforceable trade rules and disciplines. Countries vary in their data policies and laws; some focus on limiting access to online information by restricting the flow of data beyond a country's borders, aiming to protect domestic interests (e.g., constituents' privacy). However, these policies can also act as protectionist measures. The EU and China, two top U.S. trading partners, have established prescriptive rules on cross-border data flows and personal data from different perspectives. The EU General Data Protection Regulation (GDPR) is driven by privacy concerns; China is focused on security. Their policies affect U.S. firms seeking to do business in those regions, as well as in other markets that emulate the EU and Chinese approaches. Unlike the EU or China, the United States does not broadly restrict cross-border data flows and has traditionally regulated privacy at a sectoral level to cover data, such as health records. U.S. trade policy has sought to balance the goals of consumer privacy, security, and open commerce. The proposed United States-Mexico-Canada Agreement (USMCA) represents the Trump Administration's first attempt to include negotiated trade rules and disciplines on privacy, cross-border data flows, and security in a trade agreement. While the United States and other countries work to define their respective national privacy strategies, many stakeholders seek a more global approach that would allow interoperability between differing national regimes to facilitate and remove discriminatory trade barriers to cross-border data flows; this could offer an opportunity for the United States to lead the global conversation. Although Congress has examined issues surrounding online privacy and has considered multiple bills, there is not yet consensus on a comprehensive U.S. online data privacy policy. Congress may weigh in as the Administration seeks to define U.S. policy on data privacy and engages in international negotiations on cross-border data flows.

prompt_front: You are given two reports by the government agency.



Question: Write a one-page summary of the report 2.



Report 2:  The national limits were set at a percentage (74%) of the median of all local fee schedule amounts for each laboratory test code; therefore, fee schedule amounts may differ by region  In general, annual increases in clinical lab fees have been based on the percentage change in the CPI-U  However, since 1987, Congress has specified lower updates  Beginning in 2014, with certain exceptions, laboratory tests provided in hospital outpatient departments are no longer paid separately under the CLFS and are instead included in the OPPS payments  PAMA introduced a new method for determining clinical laboratory payments and required CMS to base Medicare CLFS reimbursement on reported private insurance payment amounts  Medicare has been using weighted median private insurer rates to calculate Medicare payment rates for laboratory tests paid under the CLFS since January 1, 2018  These payment rates are national and do not vary by geographic area  Part B also covers diagnostic nonlaboratory x-ray tests and other diagnostic tests, as well as x-ray, radium, and radioisotope therapy  Generally, these services are paid for under the physician fee schedule, with beneficiaries responsible for a 20% coinsurance payment  Medicare covers a wide variety of equipment and devices under the heading of durable medical equipment (DME), prosthetics, and orthotics (PO) if they are medically necessary and are prescribed by a physician  DME is defined as equipment that (1) can withstand repeated use, (2) has an expected life of at least three years (effective for items classified as DME after January 1, 2012), (3) is used primarily to serve a medical purpose, (4) is not generally useful in the absence of an illness or injury, and (5) is appropriate for use in the home  DME includes such items as hospital beds, wheelchairs, blood glucose monitors, and oxygen and oxygen equipment  It also includes related supplies (S), such as drugs and biologics that are necessary for the effective use of the product  Prosthetics (P) are items that replace all or part of a body organ or its function, such as colostomy bags, pacemakers, and artificial eyes, arms, or legs  Orthotics (O) are braces that support a weak or deformed body member, such as leg or back braces  Except in competitive bidding areas (CBAs, described below), Medicare pays for most durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) based on fee schedules  Medicare pays 80% of the lower of the supplier's charge for the item or the fee schedule amount  The beneficiary is responsible for the remaining 20%  In general, fee schedule amounts are updated each year by a (1) measure of price inflation, and (2) a measure of economy-wide productivity, which may result in lower fee schedule amounts from one year to the next  Since 2016, the fee schedule rates that applied outside of competitive bidding areas for certain DMEPOS have been reduced based on price information from the competitive bidding program  The reductions were phased in during 2016, and fully phased in starting in January 2017  In response to concerns that the adjusted rates were too low, the Secretary again applied the phase-in rate for rural and noncontiguous areas not subject to competitive bidding starting in June 2018  Currently, two different fee schedules apply outside of CBAs  First, in rural or noncontiguous areas, the fee schedule is a 50/50 blend of the fee schedule with and without the reductions based on information from competitive bidding (i e , the phase-in methodology)  Second, in nonrural and contiguous areas, the fee schedule amounts are fully adjusted by information from the competitive bidding program  Numerous studies and investigations indicated that Medicare paid more for certain items of DME and PO than some other health insurers and some retail outlets  Such overpayments were attributed, in part, to the fee schedule mechanism of payment  MMA required the Secretary to establish a Competitive Acquisition Program for certain DMEPOS in specified areas  Instead of paying for medical equipment based on a fee schedule established by law, payment for items in competitive bidding areas was based on the supplier bids  The program started in 9 metropolitan areas in January 2011 and had expanded to 130 competitive bidding areas in 2018  However, the program has been suspended while a new bidding methodology is established  During the gap, the payments for previously competitively bid items in competitive bidding areas will be the amounts that applied on December 31, 2018, increased, yearly, by a measure of inflation  Certain specified outpatient prescription drugs and biologics are covered under Medicare Part B  (However, most outpatient prescription drugs are covered under Part D, discussed below ) Covered Part B drugs and biologics include drugs furnished incident to physician services, immunosuppressive drugs following a Medicare-covered organ transplant, erythropoietin for treatment of anemia for individuals with ESRD when not part of the ESRD composite rate, oral anticancer drugs (provided they have the same active ingredients and are used for the same indications as chemotherapy drugs that would be covered if furnished incident to physician services), certain vaccines under selected conditions, and drugs administered through DME  Generally, Medicare reimburses physicians and other providers, such as hospital outpatient clinics, for covered Part B drugs and biologics at 106% of the volume weighted average sales price of all drugs billed under the same billing code, although some Part B drugs, such as those administered through DME, are reimbursed at 95% of the drug's average wholesale price  Health care providers also are paid separately for administering Medicare Part B drugs  Medicare pays 80% of the amount paid to providers, and beneficiaries are responsible for the remaining 20%  A hospital outpatient is a person who has not been admitted by the hospital as an inpatient but is registered on the hospital records as an outpatient  Generally, payments under the hospital outpatient prospective payment system (OPPS) cover the operating and capital-related costs that are directly related and integral to performing a procedure or furnishing a service on an outpatient basis  These payments cover services such as the use of an operating suite, treatment, procedure, or recovery room; use of an observation bed as well as anesthesia; certain drugs or pharmaceuticals; incidental services; and other necessary or implantable supplies or services  Payments for services such as those provided by physicians and other professionals as well as therapy and clinical diagnostic laboratory services, among others, are separate  Under the OPPS, the unit of payment for acute care hospitals is the individual service or procedure as assigned to an ambulatory payment classification (APC)  To the extent possible, integral services and items (excluding physician services paid under the physician fee schedule) are bundled within each APC  Specified new technologies are assigned to "new technology APCs" until clinical and cost data are available to permit assignment into a "clinical APC " Medicare's hospital outpatient payment is calculated by multiplying the relative weight associated with an APC by a conversion factor  For most APCs, 60% of the conversion factor is geographically adjusted by the wage index used for the inpatient prospective payment system  Except for new technology APCs, each APC has a relative weight that is based on the median cost of services in that APC  The OPPS also includes pass-through payments for new technologies (specific drugs, biologicals, and devices) and payments for outliers  The Medicare Payment Advisory Commission (MedPAC) has recommended site-neutral payment policies that base payments on the resources needed to provide high-quality care in the most efficient setting  The Bipartisan Budget Act of 2015 (BBA 15; P L  114-74 ) gave CMS the authority to add new restrictions on Medicare payments for services furnished in provider-based off-campus hospital outpatient departments (HOPDs) to address discrepancies between payments under the MPFS and the OPPS for similar services  In its 2019 OPPS Final Rule, CMS explicitly applies the site-neutral policy to clinic visits, the most commonly billed service in hospital outpatient departments  An ambulatory surgical center (ASC) is a distinct entity that furnishes outpatient surgical procedures to patients who do not require an overnight stay after the procedure  According to MedPAC, most ASCs are freestanding facilities rather than part of a larger facility, such as a hospital  Medicare covers surgical and medical services performed in an ambulatory surgical center that are (1) commonly performed on an inpatient basis but may be safely performed in an ASC; (2) not of a type that are commonly performed or that may be safely performed in physicians' offices; (3) limited to procedures requiring a dedicated operating room or suite and generally requiring a postoperative recovery room or short-term (not overnight) convalescent room; and (4) not otherwise excluded from Medicare coverage  Medicare pays for surgery-related facility services provided in ASCs using a prospective payment system based on the OPPS  (Associated physician fees are paid for separately under the physician fee schedule ) Each of the approximately 3,500 procedures approved for payment in an ASC is classified into an APC group on the basis of clinical and cost similarity  The ASC system primarily uses the same payment groups as the OPPS; however, ASC payment rates are generally lower  The ASC weights are scaled (reduced) to account for the different mix of services in an ASC, and the ASC conversion factor (the base payment amount) is lower  A different payment method is used to set ASC payment for office-based procedures, separately payable radiology services, separately payable drugs, and device-intensive procedures  In addition, separate payments are made for certain ancillary items and services when they are integral to surgical procedures, including corneal tissue acquisition, brachytherapy sources, certain radiology services, many drugs, and certain implantable devices  The application of the site-neutral payment policy to clinic visits also affects such payments to ASCs (see discussion above)  Medicare Part B covers emergency and nonemergency ambulance services to or from a hospital, a critical access hospital, a skilled nursing facility, or a dialysis facility for End-Stage Renal Disease (ESRD) beneficiaries who require dialysis when other modes of transportation could endanger the Medicare beneficiary's health  In most cases, the program covers 80% of the allowed amount for the service, and the beneficiary is responsible for the remaining 20%  Generally, ambulance services are covered if (1) transportation of the beneficiary occurs; (2) the beneficiary is taken to an appropriate location (generally, the closest appropriate facility); (3) the ambulance service is medically necessary (other forms of transportation are contraindicated); (4) the ambulance provider or supplier meets state licensing requirements; and (5) the transportation is not part of a Medicare Part A covered stay  Medicare covers both scheduled and nonscheduled nonemergency transports if the beneficiary is bed-confined or meets other medical necessity criteria  Medicare may also cover emergency ambulance transportation by airplane or helicopter if the beneficiary's location is not easily reached by ground transportation or if long distance or obstacles, such as heavy traffic, would prevent the individual from obtaining needed care  Medicare pays for ambulance services according to a national fee schedule  The fee schedule establishes seven categories of ground ambulance services and two categories of air ambulance services  Medicare pays for different levels of ambulance services, which reflect the staff training and equipment required to meet the patient's medical condition or health needs  Generally, basic life support is provided by emergency medical technicians (EMTs)  Advanced life support is provided by EMTs with advanced training or by paramedics  Some rural ground and air ambulance services may qualify for increased payments  Also, ambulance providers that are CAHs, or that are entities that are owned and operated by a CAH, are paid on a reasonable-cost basis rather than the fee schedule if they are the only ambulance provider within a 35-mile radius  Medicare covers Part B services in rural health clinics (RHCs) and federally qualified health centers (FQHCs) provided by (1) physicians and specified nonphysician practitioners; (2) visiting nurses for homebound patients in home health shortage areas; (3) registered dieticians or nutritional professionals for diabetes training and medical nutrition therapy; and (4) others, as well as certain drugs administered by a physician or nonphysician practitioner  RHCs are paid based on an "all-inclusive" cost-based rate per beneficiary visit subject to a per visit upper limit, adjusted annually for inflation  For cost-reporting periods that began on or after October 1, 2014, FQHCs are paid a base payment rate per visit (with a limit, in most cases, of one billable visit per day) under a PPS methodology  Each FQHC's PPS rate is adjusted based on the location where the service is furnished using geographic adjustment factors, which are the geographic practice cost indices (GPCI) used in Medicare's physician fee schedule (MPFS)  This rate is increased by 34% for new patients (those not seen in the FQHC organization within the past three years)  The 34% increase also applies when a beneficiary receives a comprehensive initial Medicare visit (an initial preventive physician examination or an initial annual wellness visit) or a subsequent annual wellness visit  Effective January 1, 2017, the FQHC PPS base rate is updated annually using an FQHC-specific market basket  Medicare's payment to the FQHC is equal to 80% of the lesser of the adjusted PPS rate or the FQHC's actual charges associated with the visit, and the beneficiary is responsible for a 20% coinsurance  Medicare Advantage (MA) is an alternative way for Medicare beneficiaries to receive covered benefits  Under MA, private health plans are paid a per-person amount to provide all Medicare covered benefits (except hospice) to beneficiaries who enroll in their plan  Medicare beneficiaries who are eligible for Part A, enrolled in Part B, and do not have ESRD are eligible to enroll in an MA plan if one is available in their area  Some MA plans may choose their service area (local MA plans), while others agree to serve one or more regions defined by the Secretary (regional MA plans)  In 2019, nearly all Medicare beneficiaries have access to an MA plan and approximately a third of beneficiaries are enrolled in one  Private plans may use different techniques to influence the medical care used by enrollees  Some plans, such as health maintenance organizations (HMOs), may require enrollees to receive care from a restricted network of medical providers; enrollees may be required to see a primary care physician who will coordinate their care and refer them to specialists as necessary  Other types of private plans, such as private fee-for-service (PFFS) plans, may look more like original Medicare, with fewer restrictions on the providers an enrollee can see and minimal coordination of care  In general, MA plans offer additional benefits or require smaller co-payments or deductibles than original Medicare  Sometimes beneficiaries pay for these additional benefits through a higher monthly premium, but sometimes they are financed through plan savings  The extent of extra benefits and reduced cost sharing varies by plan type and geography  However, MA plans are seen by some beneficiaries as an attractive alternative to more expensive supplemental insurance policies found in the private market  By contract with CMS, a plan agrees to provide all required services covered in return for a capitated monthly payment adjusted for the demographics and health history of their enrollees  The same monthly payment is made regardless of how many or few services a beneficiary actually uses  In general, the plan is at-risk if costs, in the aggregate, exceed program payments; conversely, the plan can retain savings if aggregate costs are less than payments  Payments to MA plans are based on a comparison of each plan's estimated cost of providing Medicare covered services (a bid) relative to the maximum amount the federal government will pay for providing those services in the plan's service area (a benchmark)  If a plan's bid is less than the benchmark, its payment equals its bid plus a rebate  The size of the rebate is dependent on plan quality and ranges from 50% to 70% of the difference between the bid and the benchmark  The rebate must be returned to enrollees in the form of additional benefits, reduced cost sharing, reduced Part B or Part D premiums, or some combination of these options  If a plan's bid is equal to or above the benchmark, its payment will be the benchmark amount and each enrollee in that plan will pay an additional premium, equal to the amount by which the bid exceeds the benchmark  The MA benchmarks are determined through statutorily specified formulas that have changed over time  Since BBA 97, formulas have increased the benchmark amounts, in part, to encourage plan participation in all areas of the country  As a result, however, the benchmark amounts (and plan payments) in some areas have been higher than the average cost of original FFS Medicare  The ACA changed the way benchmarks are calculated by tying them closer to (or below) spending in FFS Medicare, and adjusting them based on plan quality  In a recent analysis, MedPAC found that "over the past few years, plan bids and payments have come down in relation to FFS spending while MA enrollment continues to grow  The pressure of lower benchmarks has led to improved efficiencies and more competitive bids that enable MA plans to continue to increase enrollment by offering benefits that beneficiaries find attractive " In 2006, the MA program began to offer MA regional plans  Regional MA plans must agree to serve one or more regions designated by the Secretary  There are 26 MA regions consisting of states or groups of states  Regional plan benchmarks include two components: (1) a statutorily determined amount (comparable to benchmarks described above) and (2) a weighted average of plan bids  Thus, a portion of the benchmark is competitively determined  Similar to local plans, plans with bids below the benchmark are given a rebate, while plans with bids above the benchmark require an additional enrollee premium  In general, MA eligible individuals may enroll in any MA plan that serves their area  However, some MA plans may restrict their enrollment to beneficiaries who meet additional criteria  For example, employer-sponsored MA plans are generally only available to the retirees of the company sponsoring the plan  In addition, Medicare Special Needs Plans (SNPs) are a type of coordinated care MA plan that exclusively enrolls, or enrolls a disproportionate percentage of, special needs individuals  Special needs individuals are any MA eligible individuals who are either institutionalized as defined by the Secretary, eligible for both Medicare and Medicaid, or have a severe or disabling chronic condition and would benefit from enrollment in a specialized MA plan  Medicare Part D provides coverage of outpatient prescription drugs to Medicare beneficiaries who choose to enroll in this optional benefit  (As previously discussed, Part B provides limited coverage of some outpatient prescription drugs ) In 2019, about 47 million (about 77%) of eligible Medicare beneficiaries are estimated to be enrolled in a Part D plan  Prescription drug coverage is provided through private prescription drug plans (PDPs), which offer only prescription drug coverage, or through Medicare Advantage prescription drug plans (MA-PDs), which offer prescription drug coverage that is integrated with the health care coverage they provide to Medicare beneficiaries under Part C  Plans must meet certain minimum requirements; however, there are significant variations among them in benefit design, including differences in premiums, drugs included on plan formularies, and cost sharing for particular drugs  Part D prescription drug plans are required to offer either "standard coverage" or alternative coverage that has actuarially equivalent benefits  In 2019, "standard coverage" has a $415 deductible and a 25% coinsurance for costs between $415 and $3,820  From this point, there is reduced coverage until the beneficiary has out-of-pocket costs of $5,100 (an estimated $8,139 54 in total spending); this coverage gap has been labeled the "doughnut hole " Once the beneficiary reaches the catastrophic limit, the program pays all costs except for the greater of 5% coinsurance or $3 40 for a generic drug and $8 50 for a brand-name drug  As required by the ACA, in 2010, Medicare sent a tax-free, one-time $250 rebate check to each Part D enrollee who reached the doughnut hole  Additionally, starting in 2011, the coverage gap is being gradually reduced each year  Under the ACA, the coverage gap for both brand-name and generic drugs was to be eliminated in 2020, but Congress moved up the date to 2019 for brand-name drugs as part of BBA 18  In 2019, a 70% discount is provided by drug manufacturers and Medicare pays an additional 5% of the cost of brand-name drugs dispensed during the coverage gap  In 2019, Medicare also pays 63% of the cost of generic drugs dispensed during the coverage gap and enrollees pay 37%  (See Figure 2  ) By 2020, through a combination of manufacturer discounts and increased Medicare coverage, Part D enrollees will be responsible for 25% of the costs for brand-name and generic drugs in the coverage gap (the same as during the initial coverage period)  Most plans offer actuarially equivalent benefits rather than the standard package, including alternatives such as reducing or eliminating the deductible, or using tiered cost sharing with lower cost sharing for generic drugs  Medicare's payments to plans are determined through a competitive bidding process, and enrollee premiums are tied to plan bids  Plans are paid a risk-adjusted monthly per capita amount based on their bids during a given plan year  Part D plan sponsors determine payments for drugs and are expected to negotiate prices  The federal government is prohibited from interfering in the price negotiations between drug manufacturers, pharmacies, and plans (the so-called "non-interference clause")  Part D also provides enhanced coverage for low-income enrolled individuals, such as persons who previously received drug benefits under Medicaid (known as "dual eligibles"—enrollees in both Medicare and Medicaid)  Additionally, certain persons who do not qualify for Medicaid, but whose incomes are below 150% of poverty, may also receive assistance for some portion of their premium and cost-sharing charges  The MMA included significant incentives for employers to continue to offer coverage to their retirees by providing a 28% federal subsidy  In 2019, the maximum potential subsidy per covered retiree is $2,264 for employers or unions offering drug coverage that is at least actuarially equivalent (called "creditable" coverage) to standard coverage  Employers or unions may select an alternative option (instead of taking the subsidy) with respect to Part D, such as electing to pay a portion of the Part D premiums  They may also elect to provide enhanced coverage, though this has some financial consequences for the employer or union  Alternatively, employers or unions may contract with a PDP or MA-PD to offer the coverage or become a Part D plan sponsor themselves for their retirees  A variety of public and private entities are involved in carrying out Medicare administrative and oversight functions  CMS, an agency within HHS, has primary operational responsibilities  Such responsibilities include managing program finances, developing policies and regulations, setting payment rates, and developing the program's information-technology infrastructure  CMS conducts its activities through its headquarters and 10 regional offices  The Social Security Administration, however, enrolls beneficiaries into the program and issues Medicare beneficiary cards  CMS also contracts with various private entities, including private health insurance companies, to help administer the program  For example, Medicare Administrative Contractors (MACs) process and pay Parts A and B reimbursement claims, enroll providers and suppliers, educate providers and suppliers on billing requirements, support appeal processes, and answer provider and supplier inquiries through call centers, as well as other activities  Qualified Independent Contractors (QICs) perform second-level reviews on appeals initially reviewed by MACs  Medicare's quality assurance activities are primarily handled by State Survey Agencies and Quality Improvement Organizations (QIOs), which operate in all states and the District of Columbia, Puerto Rico, and the U S  Virgin Islands  The State Survey Agencies are responsible for inspecting Medicare provider facilities (e g , nursing homes, home health agencies, and hospitals) to ensure that they are in compliance with federal safety and quality standards referred to as Conditions (or Requirements) of Participation  Alternatively, some types of providers, including hospitals, may receive certification through private accrediting agencies, such as the Joint Commission  QIOs are mostly private, not-for-profit organizations that monitor the quality of care delivered to Medicare beneficiaries and educate providers on the latest quality-improvement techniques  Medicare program integrity activities, such as audits, provider education, medical review, and predictive data analysis, also are carried out by a variety of government and private entities  For example, the Center for Program Integrity within CMS works together with the U S  Department of Justice (DOJ) and the HHS Office of Inspector General (OIG) to identify and prevent fraud, waste, and abuse in Medicare  CMS also works with private contractors to carry out certain program-integrity functions  Unified Program Integrity Contractors (UPICs) perform integrity-related activities including data analysis to identify potentially fraudulent claims (bills) for Medicare Parts A and B, home health and hospice services, and DME  Similarly, the National Benefit Integrity Medicare Drug Integrity Contractor (MEDIC) is responsible for identifying and investigating fraud, waste, and abuse in Medicare Advantage and Part D  When appropriate, the UPICs and MEDIC work with and refer cases to law enforcement, including OIG and DOJ  In addition, Recovery Audit Contractors (RACs) are responsible for identifying improper Medicare payments, including both underpayments and overpayments, and for recouping any overpayments made to providers  Each year, the Comprehensive Error Rate Testing (CERT) program quantifies a national improper Medicare payment rate by examining a random sample of claims  In turn, the Supplemental Medical Review Contractor targets medical reviews in areas where OIG, RACs, and CERT have identified vulnerabilities and/or questionable billing patterns to identify ways to lower improper payment rates  As required by the ACA, the Center for Medicare and Medicaid Innovation (CMMI) was established in January 2011 to test and evaluate innovative payment and service delivery models to reduce program expenditures under Medicare  Examples of these models include providing payment incentives for groups of doctors, hospitals, and other health care providers (Accountable Care Organizations, or ACOs) to coordinate the services they provide to Medicare beneficiaries; bundling payments for services provided in different settings during a beneficiary's episode of care; and reimbursing health providers based on the quality of care rather than on the volume of services  CMMI also plays an important role in developing and implementing the new physician payment models required by MACRA  Medicare beneficiary education and outreach duties are shared between CMS and the Social Security Administration  Each year, CMS mails out a "Medicare and You" handbook to beneficiaries, which provides information on their benefits for the upcoming year  Additional educational materials and responses to frequently asked questions may be found on the CMS-maintained "Medicare gov" website, and beneficiaries may call a CMS-operated 1-800 number for assistance with specific questions and help with selecting and enrolling in a Medicare Advantage and/or Part D plan  A Medicare beneficiary ombudsman is also available to provide assistance to Medicare consumers with their complaints, grievances, and requests  The Social Security Administration is responsible for notifying low-income Medicare beneficiaries about programs that may be able to assist them with their medical and prescription drug expenses  The Social Security Administration also provides general Medicare eligibility and enrollment information on its webpage and on Social Security benefit statements  Finally, CMS partners with community-based organizations, such as State Health Insurance Assistance Programs, in every state to provide educational resources and personalized assistance to Medicare beneficiaries  Medicare's financial operations are accounted for through two trust funds maintained by the Department of the Treasury—the Hospital Insurance (HI) trust fund for Part A and the Supplementary Medical Insurance (SMI) trust fund for Parts B and D  For beneficiaries enrolled in Medicare Advantage (Part C), payments are made on their behalf in appropriate portions from the HI and SMI trust funds  HI is primarily funded by payroll taxes, while SMI is primarily funded through general revenue transfers and premiums  (See Figure 3  ) The HI and SMI trust funds are overseen by a Board of Trustees that provides annual reports to Congress  The trust funds are accounting mechanisms  Income to the trust funds is credited to the fund in the form of interest-bearing government securities  Expenditures for services and administrative costs are recorded against the fund  These securities represent obligations that the government has issued to itself  As long as a trust fund has a balance, the Department of the Treasury is authorized to make payments for it from the U S  Treasury  Medicare expenditures are primarily paid for through mandatory spending—generally Medicare pays for all covered health care services provided to beneficiaries  Aside from certain constraints in HI described below, the program is not subject to spending limits  Additionally, most Medicare expenditures (aside from premiums paid by beneficiaries) are paid for by current workers through income taxes and dedicated Medicare payroll taxes, that is, current income is used to pay current expenditures  Medicare taxes paid by current workers are not set aside to cover their future Medicare expenses  The primary source of funding for Part A is payroll taxes paid by employees and employers  Each pays a tax of 1 45% on the employee's earnings; the self-employed pay 2 9%  Beginning in 2013, some higher-income employees pay higher payroll taxes  Unlike Social Security, there is no upper limit on earnings subject to the tax  Other sources of income include (1) interest on federal securities held by the trust fund, (2) a portion of federal income taxes that individuals pay on their Social Security benefits, and (3) premiums paid by voluntary enrollees who are not automatically entitled to Medicare Part A  Income for Part A is credited to the HI trust fund  Part A expenditures for CY2019 are estimated to reach approximately $330 billion  Revenue to the trust fund is expected to consist of about $285 billion in payroll tax income and another $38 billion in interest and other income  The Medicare Trustees project that in CY2019, the HI trust fund will incur a deficit of approximately $7 billion  As long as the HI trust fund has a balance, the Treasury Department is authorized to make payments for Medicare Part A services  To date, the HI trust fund has never run out of money (i e , become insolvent), and there are no provisions in the Social Security Act that govern what would happen if that were to occur  Part A expenditures exceeded HI income each year from 2008 through 2015, and the assets credited to the trust fund were drawn down to make up the deficit in those years  Although the HI trust fund accumulated small surpluses in 2016 and 2017, the Medicare Trustees estimate that, beginning in 2018, expenditures will outpace income in all future years, and project that the HI trust fund will become insolvent in 2026 (i e , the balance of the trust fund will reach $0)  At that time there would no longer be sufficient funds to fully cover Part A expenditures  Medicare Part B is financed primarily from federal general revenues and from beneficiary premiums, which are set at 25% of estimated per capita program costs for the aged  (The disabled pay the same premium as the aged ) Income for Part B is credited to the SMI trust fund  Total spending for Part B is estimated to reach about $368 billion in CY2019, with premiums financing about $98 billion of that amount and general revenues financing most of the rest  Most beneficiaries who enroll in Medicare Part B pay a monthly premium  Individuals receiving Social Security benefits have their Part B premium payments automatically deducted from their Social Security benefit checks  Due to a "hold-harmless" provision in the Social Security Act, an individual's Social Security check cannot decrease from one year to the next as a result of the annual Part B premium increase (except in the case of higher-income individuals subject to income-related premiums)  The 2019 monthly Part B premium is $135 50  However, about 3 5% of Medicare enrollees are protected by the hold-harmless provision and pay lower premium amounts because the dollar amount of the 2019 cost-of-living increase in their Social Security benefits was not sufficient to cover the full premium increase  Since 2007, higher-income Part B enrollees have paid higher premiums  In 2019, individuals whose modified adjusted gross income (AGI) exceeds $85,000 and each member of a couple filing jointly whose modified AGI exceeds $170,000 are subject to higher premium amounts  These higher-income premiums range from 35% to 85% of the value of Part B and affect about 5% of Medicare enrollees  (See Appendix B for 2019 Part B premiums and high-income thresholds ) Payments for spending under the Medicare Advantage program are made in appropriate portions from the HI and SMI trust funds  There is no separate trust fund for Part C  Medicare Part D is financed through a combination of beneficiary premiums and federal general revenues  In addition, certain transfers are made from the states  These transfers, referred to as "clawback payments," represent a portion of the amounts states could otherwise have been expected to pay for drugs under Medicaid if drug coverage for the dual eligible population had not been transferred to Part D  Part D revenues are credited to a separate Part D account within the SMI trust fund  In CY2019, total spending for Part D is estimated to reach approximately $98 billion, with about $71 billion of that amount paid for by general revenues, $16 billion from beneficiary premiums, and $12 billion from state transfers  In 2019, the base beneficiary premium is $33 19; however, beneficiaries pay different premiums depending on the plan they have selected and whether they are entitled to low-income premium subsidies  Additionally, beginning in 2011, higher income Part D enrollees pay higher premiums  (The income thresholds are the same as for Part B, as described above ) On average, beneficiary premiums are set at 25 5% of expected total Part D costs for basic coverage  The Budget Control Act of 2011 (BCA; P L  112-25 ) provided for increases in the debt limit and established procedures designed to reduce the federal budget deficit, including the creation of a Joint Select Committee on Deficit Reduction  The failure of the Joint Committee to propose deficit reduction legislation by its mandated deadline triggered automatic spending reductions ("sequestration" of mandatory spending and reductions in discretionary spending) in fiscal years 2013 through 2021  The American Taxpayer Relief Act of 2012 (ATRA; P L  112-240 ) delayed the automatic reductions by two months, while the Bipartisan Budget Act of 2013 (BBA; P L  113-67 ) extended sequestration for mandatory spending for an additional two years—through FY2023  In 2014, the President signed into law an amended version of S  25 ( P L  113-82 ), which included a provision to extend BCA's sequester of mandatory spending through FY2024  BBA 15 extended the sequestration of mandatory spending another year, through FY2025  Most recently, BBA 18 extended the BCA mandatory spending sequester through FY2027  Section 256(d) of the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA; P L  99-177 ) contains special rules for the Medicare program in the event of a sequestration  Among other things, it specifies that for Medicare, sequestration is to begin the month after the sequestration order has been issued  Therefore, as the sequestration order was issued March 2013, Medicare sequestration began April 1, 2013, and will continue through March 31, 2028  Under sequestration, Medicare's benefit structure generally remains unchanged; however, benefit related payments are subject to 2% reductions  In other words, most Medicare payments to health care providers, as well as to MA and Part D plans, are being reduced by 2%  Certain Medicare payments are exempt from sequestration and therefore not reduced  These exemptions include (1) Part D low-income subsidies, (2) the Part D catastrophic subsidy, and (3) Qualified Individual (QI) premiums  Some non-benefit related Medicare expenses, such as administrative and operational spending, are subject to higher reductions, 6 2% in 2019  While Medicare provides broad protection against the costs of many, primarily acute care, services, the program does not cover all services that may be used by its aged and disabled beneficiaries  In general, Medicare does not cover eyeglasses, hearing aids, dentures, or most long-term care services  Further, unlike most private insurance policies, it does not include an annual "catastrophic" cap on out-of-pocket spending on cost-sharing charges for services covered under Parts A and B (except for persons enrolled in Medicare Advantage plans)  Most Medicare beneficiaries have some coverage in addition to Medicare  The following are the main sources of additional coverage for Medicare enrollees: Medicare Advantage  Many MA plans offer services in addition to those covered under original Medicare, reduced cost sharing, or reduced Part B or D premiums  All MA plans have a catastrophic cap  Employer Coverage  Coverage may be provided through a current or former employer  In recent years, a number of employers have cut back on the scope of retiree coverage  Some have dropped such coverage entirely, particularly for future retirees  As noted earlier, the MMA attempted to stem this trend, at least for prescription drug coverage, by offering subsidies to employers who offer drug coverage, at least as good as that available under Part D  Medigap  Individual insurance policies that supplement fee-for-service Medicare are referred to as Medigap policies  Beneficiaries with Medigap insurance typically have coverage for a portion of Medicare's deductibles and coinsurance; they may also have coverage for some items and services not covered by Medicare  Individuals select from a set of standardized plans, though not all plans are offered in all states  Medicaid  Certain low-income Medicare beneficiaries also may be eligible for full or partial benefits under their state's Medicaid program  Individuals eligible for both Medicare and Medicaid are referred to as dual eligibles  The lowest-income dual eligibles qualify for full Medicaid benefits, so that the majority of their health care expenses are paid by either Medicare or Medicaid; Medicare pays first, with Medicaid picking up most of the remaining costs  In addition to full-benefit dual eligibles, state Medicaid programs pay Medicare premiums and some cost sharing for other partial dual eligibles, who have higher income than full-benefit dual eligibles but are still considered to have low income  Other Public Sources  Individuals may have additional coverage through the Department of Veterans Affairs, or TRICARE for military retirees eligible for Medicare (and enrolled in Part B)  In 2015, about 87% of Medicare beneficiaries had some form of additional coverage  Some persons may have had more than one type of additional coverage  Appendix A  Abbreviations Appendix B  2019 Medicare Beneficiary Costs
Report 2: com/daily-news/2013/06/04/sexual-assaults-force-changes-to-military-justice html Zengerle, Patricia  "U S  Lawmakers Act to Limit Military Authority in Sex Assault Cases," Reuters, June 5, 2013, at http://www reuters com/article/2013/06/05/us-usa-military-sexassault-congress-idUSBRE9541IG20130605 Cassata, Donna and Richard Lardner  " House OKs 2-Yr Jail Term for Military Sex Assault ," Associated Press, June 14, 2013, at http://www military com/daily-news/2013/06/14/house-oks-2-year-jail-term-for-military-sex-assault html Montgomery, Nancy  " After 2 decades of sexual assault in military, no real change in message ," Stars and Stripes , July 7, 2013, at https://www stripes com/news/after-2-decades-of-sexual-assault-in-military-no-real-change-in-message-1 229091 Steinhauer, Jennifer  "Complex Fight in Senate over Curbing Military Sex Assaults," New York Times , June 14, 2013, at http://www nytimes com/2013/06/15/us/politics/in-senate-complex-fight-over-curbing-sexual-military-assaults html?pagewanted=all Dao, James  "In Debate over Military Sexual Assault, Men Are Overlooked Victims," New York Times , June 23, 2013, at http://www nytimes com/2013/06/24/us/in-debate-over-military-sexual-assault-men-are-overlooked-victims html?pagewanted=all&_r=0 Sisk, Richard  "Military Tries to Sever Booze, Sex Assault Link," Military com, July 8, 2013, at http://www military com/daily-news/2013/07/08/military-tries-to-sever-booze-sex-assault-link html Watson, Julie  "Military Works to Change Culture to Combat Rape," Associated Press, July 15, 2013, at http://www military com/daily-news/2013/07/15/military-works-to-change-culture-to-combat-rape html Olson, Wyatt  "IG Review Finds Deficiencies in Sex Assault Cases," Stars and Stripes, July 16, 2013, at http://www military com/daily-news/2013/07/16/ig-review-finds-deficiencies-in-sex-assault-cases html Shanker, Thom  "New Support for Military in Sex Cases," New York Times , July 24, 2013, at http://www nytimes com/2013/07/25/us/politics/new-support-for-military-in-sex-cases html Taranto, James  "A Strange Sort of Justice at West Point," The Wall Street Journal, July 26, 2013, at https://www wsj com/articles/a-strange-sort-of-justice-at-west-point-1376453937 Cassata, Donna, "Senator Targets Military Law over Sexual Assault," Associated Press, July 29, 2013, at http://www military com/daily-news/2013/07/29/senator-targets-military-law-over-sexual-assault html?comp=7000023317843&rank=3 Groer, Annie  " Military brass claim progress in pursuing sexual assault cases ," Washington Post, August 1, 2013, at https://www washingtonpost com/blogs/she-the-people/wp/2013/08/01/military-brass-claim-progress-in-pursing-sexual-assault-cases/?utm_term= 72e55e7e218c Jennifer Koons  "Sexual Assault in the Military: Can the Pentagon stem the rise in incidents?" CQ Researcher , vol  23, no  29 (A ugust 9, 2013 ), p p  693-716   Laird, Lorelei  " Military lawyers confront changes as sexual assault becomes big news ," ABA (American Bar Association) Journal , September 2013, at http://www abajournal com/magazine/article/military_lawyers_confront_changes_as_sexual_assault_becomes_big_news/ Jelinek, Pauline  " Pentagon: Reports of Sexual Assault Up 46 Percent ," Associated Press, November 8, 2013, at http://www military com/daily-news/2013/11/08/pentagon-reports-of-sexual-assault-up-46-percent html Matthews, Michael F  " The Untold Story of Military Sexual Assault ," The New York Times, November 24, 2013, at http://www nytimes com/2013/11/25/opinion/the-untold-story-of-military-sexual-assault html " Men Sexually Assaulted in the Military Speak Out ," Baltimore Sun, December 20, 2013, at http://www military com/daily-news/2013/12/20/men-sexually-assaulted-in-the-military-speak-out html Kageyama, Yuri and Richard Lardner  "Documents Reveal Chaotic Military Sex-Abuse Record," Associated Press, February 10, 2014, at http://www military com/daily-news/2014/02/10/documents-reveal-chaotic-military-sex-abuse-record html Montgomery, Nancy  "AF Program Rare Bright Spot in Sex Assault Fight," Stars and Stripes , February 27, 2014, at http://www military com/daily-news/2014/02/27/air-force-program-rare-bright-spot-in-sex-assault-fight html Cox, Matthew  "Alcohol Policies Reviewed as Sex Assault Rises," Military com, May 1, 2014, at http://www military com/daily-news/2014/05/01/alcohol-policies-reviewed-as-sex-assault-rises html Burns, Robert  "Army Knocks 2-Star Down to 1-Star Rank," Associated Press, August 27, 2014, at http://www military com/daily-news/2014/08/27/army-knocks-2-star-down-to-1-star-rank html Milham, Matt  "Army: It's Good News That Sexual Assault Reports Are Up," Stars and Stripes , September 26, 2014, at http://www military com/daily-news/2014/09/26/army-its-good-news-that-sexual-assault-reports-are-up html Draper, Robert  The Military's Rough Justice on Sexual Assault," New York Times , November 26, 2014, at https://www nytimes com/2014/11/30/magazine/the-militarys-rough-justice-on-sexual-assault html Sisk, Richard  "Sexual Assault Reports Increase 8%, Pentagon Cites Progress," Military com, December 4, 2014, at http://www military com/daily-news/2014/12/04/sexual-assault-reports-increase-8-pentagon-cites-progress html Baldor, Lolita C  "Male Military Sex Assault Victims Slow to Complain," Associated Press, December 9, 2014, at http://www military com/daily-news/2014/12/09/male-military-sex-assault-victims-slow-to-complain html Roulo, Claudette  "Sexual Assault Rates Decrease at Military Service Academies," DOD News, Defense Media Activity, February 11, 2015, at http://archive defense gov/news/newsarticle aspx?id=128158 Pellerin, Cheryl  "DOD Honors Sexual Assault Response Coordinators," DOD News, April 23, 2015, at https://www defense gov/News/Article/Article/604510/ Rowe, Major Derek  "General courts-martial for sexual assault: How do they work?" Air Force News , April 28, 2015, at http://www af mil/News/Commentaries/Display/Article/586763/general-courts-martial-for-sexual-assault-how-do-they-work/ Sisk, Richard  "Military Sexual Assault Reports Increased 11 Percent Last Year," Military com, May 1, 2015, at http://www military com/daily-news/2015/05/01/military-sexual-assault-reports-increased-11-percent-last-year html Johnson, Lieutenant General Michelle D , U S  Air Force Academy superintendent; Vice Admiral Walter E  "Ted" Carter Jr , superintendent, U S  Naval Academy; Lieutenant General Robert L  Caslen, superintendent, U S  Military Academy; Rear Admiral James A  Helis, superintendent, U S  Merchant Marine Academy; Rear Admiral Sandra L  Stosz, superintendent, U S  Coast Guard Academy  "Lessons to Share: The five superintendents of federal service academies discuss how their institutions -- which faced scrutiny over sexual assault before many other colleges attracted such attention -- have responded to the issue," Inside Higher Ed, May 7, 2015, at https://www insidehighered com/views/2015/05/07/essay-how-federal-service-academics-prevent-and-punish-sexual-assault Tilghman, Andrew  "Military sexual assault claims: 1 in 20 lead to jail time," Military Times, May 13, 2015, at https://www militarytimes com/2015/05/13/military-sexual-assault-claims-1-in-20-lead-to-jail-time/ Schogol, Jeff  "Defense seeks dismissal of sexual assault case transferred to Washington," Air Force Times, October 17, 2015, at https://www airforcetimes com/news/your-air-force/2015/10/17/defense-seeks-dismissal-of-sexual-assault-case-transferred-to-washington/ Whitlock, Craig  "In the war against sexual assault, the Army keeps shooting itself in the foot," Washington Post, December 19, 2015, at https://www washingtonpost com/news/checkpoint/wp/2015/12/19/in-the-war-against-sexual-assault-the-army-keeps-shooting-itself-in-the-foot/?utm_term= d856136e939b Defense Media Activity  "Defense Department Proposes UCMJ Changes," DOD News, December 28, 2015, at https://www defense gov/News/Article/Article/638108/defense-department-proposes-ucmj-changes/ Losey, Stephen  "USAF launches new strategy to curb sexual assault," Air Force Times, December 30, 2015, at https://www airforcetimes com/news/your-air-force/2015/12/30/usaf-launches-new-strategy-to-curb-sexual-assault/ Kime, Patricia  "Sexual assault reporting rises at U S  service academies," Military Times , January 8, 2016, at https://www militarytimes com/news/your-military/2016/01/08/sexual-assault-reporting-rises-at-u-s-service-academies/ Larter, David B  "Navy sex assault victims may be eligible for early separation," Navy Times, January 20, 2016, at https://www navytimes com/news/your-navy/2016/01/20/navy-sex-assault-victims-may-be-eligible-for-early-separation/ Cox, John Woodrow  "Why sex assault reports have spiked at the Naval Academy, West Point and the Air Force Academy, Washington Post , March 11, 2016, at https://www washingtonpost com/news/checkpoint/wp/2016/03/11/why-sex-assault-reports-have-spiked-at-the-naval-academy-west-point-and-the-air-force-academy/?utm_term= a5e15f2f16f1 Whitlock, Craig, Thomas Gibbons-Neff  "Military bringing more charges against ofﬁcers for sexual assault," Washington Post, March 20, 2016, at https://www stripes com/news/us/military-bringing-more-charges-against-of%EF%AC%81cers-for-sexual-assault-1 400140# WeTFNOFRXUc Lardner, Richard  "Pentagon misled lawmakers on military sexual assault cases," Associated Press , April 18, 2016, at https://apnews com/23aed8a571f64a9d9c81271f0c6ae2fa/pentagon-misled-lawmakers-military-sexual-assault-cases Kheel, Rebecca  "Senators ask Obama to investigate whether Pentagon misled Congress," The Hill, April 19, 2016, at http://thehill com/policy/defense/276832-senators-ask-obama-to-investigate-pentagons-sexual-assault-comments Secretary of the Air Force Public Affairs  "Air Force report on sexual assault highlights program's progress," Air Force News , May 05, 2016, at http://www af mil/News/Article-Display/Article/752653/air-force-report-on-sexual-assault-highlights-programs-progress/ Tilghman, Andrew  "Military sex assault: Just 4 percent of complaints result in convictions," Military Times , May 5, 2016, at https://www militarytimes com/veterans/2016/05/05/military-sex-assault-just-4-percent-of-complaints-result-in-convictions/ Montgomery, Nancy  "US Military Court Addresses 'Incapable of Consent' to Sex Issue," Stars and Stripes , May 18, 2016, at http://www military com/daily-news/2016/05/18/us-military-court-addresses-incapable-of-consent-to-sex-issue html Losey, Stephen  "Military must do right by wrongly-discharged sexual assault victims, advocates say," Air Force Times , May 19, 2016, at https://www airforcetimes com/news/your-air-force/2016/05/19/military-must-do-right-by-wrongly-discharged-sexual-assault-victims-advocates-say/ Lyle, Amaani  "DoD Safe Helpline Offers Specialized Support to Sexual Assault Victims," DOD News, July 15, 2016, at https://dod defense gov/News/Article/Article/841166/dod-safe-helpline-offers-specialized-support-to-sexual-assault-victims/ Rein, Lisa  "Merchant Marine Academy under fire for sexual assault allegations," Stars and Stripes, August 12, 2016, at https://www stripes com/news/us/merchant-marine-academy-under-fire-for-sexual-assault-allegations-1 423595 Lyle, Amaani  "DoD Unveils Plan to Broaden Sexual Assault Support to Men," DOD News, Defense Media Activity, December 15, 2016, at https://www defense gov/News/Article/Article/1030795/dod-unveils-plan-to-broaden-sexual-assault-support-to-men/ The following sources are listed in alphabetical order by author  Burgess, Ann W , Donna M  Slattery, and Patricia A  Herlihy  "Military Sexual Trauma: A Silent Syndrome " Journal of Psychosocial Nursing & Mental Health Services 51, no  2 (2013): 20-6  D'Ambrosio-Woodward, Tricia  "Military Sexual Assault: A Comparative Legal Analysis of the 2012 Department of Defense Report on Sexual Assault in the Military: What It Tells Us, What It Doesn't Tell Us, and How Inconsistent Statistic Gathering Inhibits Winning the 'Invisible War '" Wisconsin Journal of Law, Gender & Society 29, no  2 (2014): 173-211  Farris, Coreen, Terry L  Schell and Terri Tanielian  Physical and Psychological Health Following Military Sexual Assault: Recommendations for Care, Research, and Policy   Santa Monica, CA: RAND Corporation, 2013  http://www rand org/pubs/occasional_papers/OP382 Firestone, Juanita M , J  M  Miller, and Richard Harris  "Implications for Criminal Justice from the 2002 and 2006 Department of Defense Gender Relations and Sexual Harassment Surveys " American Journal of Criminal Justice : AJCJ 37, no  3 (2012): 432-451  Gibson, Carolyn J , Kristen E  Gray, Jodie G  Katon, Tracy L  Simpson, and Keren Lehavot  "Sexual Assault, Sexual Harassment, and Physical Victimization during Military Service across Age Cohorts of Women Veterans " Women's Health Issues 26, no  2 (2016): 225-231  Harrell, Margaret C , Laura Werber, Marisa Adelson, Sarah J  Gaillot, Charlotte Lynch and Amanda Pomeroy  A Compendium of Sexual Assault Research   Santa Monica, CA: RAND Corporation, 2009  http://www rand org/pubs/technical_reports/TR617 Holland, Kathryn, Rabelo, Verónica, and Cortina, Lilia  Sexual Assault Training in the Military: Evaluating Efforts to End the 'Invisible War ' American Journal of Community Psychology 54, no  3/4 (2014): 289-303  Morral, Andrew R , Kristie Gore, and Terry L  Schell  Sexual Assault and Sexual Harassment in the U S  Military, Volume 1  Design of the 2014 RAND Military Workplace Study   Santa Monica, CA: RAND Corporation, National Defense Research Institute, 2014  https://www rand org/pubs/research_briefs/RB9841 html Morral, Andrew R , Kristie Gore, and Terry L  Schell  Sexual Assault and Sexual Harassment in the U S  military: Volume 2  Estimates for Department of Defense Service members from the 2014 RAND Military Workplace Study   Santa Monica, CA: RAND Corporation, National Defense Research Institute, 2015  https://www rand org/pubs/research_reports/RR870z2-1 html O'Brien, Carol, Jessica Keith, and Lisa Shoemaker  "Don't Tell: Military Culture and Male Rape " Psychological Services 12, no  4 (2015): 357-365  Stander, Valeria A  and Cynthia J  Thomsen  "Sexual Harassment and Assault in the U S  Military: A Review of Policy and Research Trends " AMSUS Military Medicine (Association of Military Surgeons of the United States) 181, no  1S (2016): 20-27  This chronological list of hearings was compiled from Congress gov and CQ com  U S  Congress, House Armed Services Committee, A Review of Sexual Misconduct by Basic Training Instructors at Lackland Air Force Base , 113 th Cong , 1 st sess , January 23, 2013, H A S C  No  113-2 (Washington, DC: GPO, 2013)  U S  Congress, House Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for 2014 , Part 1, 113th Cong , 1 st sess , February 26, 2013 (Washington, DC: GPO, 2013)  U S  Congress, Senate Armed Services Committee, Subcommittee on Personnel, Testimony on Sexual Assault in the Military, 113 th Cong , 1 st sess , March 13, 2013, S  Hrg  113-303 (Washington, DC: GPO, 2013)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for Fiscal Year 2014 , 113th Cong , 1 st sess , April 17, 2013 (Washington, DC: GPO, 2013)  U S  Congress, House Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for 2014, Part 2 , 113th Cong , 1 st sess , April 24, 2013 (Washington, DC: GPO, 2013)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for Fiscal Year 2014 , 113th Cong , 1 st sess , April 24, 2013 (Washington, DC: GPO, 2013)  U S  Congress, House Appropriations Committee, Subcommittee on Defense, President Obama's Fiscal 2014 Budget Proposal for the U S  Navy and Marine Corps , 113 th Cong , 1 st sess , May 7, 2013 (Washington, DC: GPO, 2013)  U S  Congress, Senate Armed Services Committee, D epartment of Defense Authorization for Appropriations for Fiscal Year 2014 and the Future Years Defense Program , 113 th Cong , 1 st sess , May 7, 2013 (Washington, DC: GPO, 2013)  U S  Congress, House Appropriations Committee, Subcommittee on Defense, President Obama's Fiscal 2014 Budget Proposal for the U S  Army , 113 th Cong , 1 st sess , May 8, 2013  (Washington, DC: GPO, 2013)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense, President Obama's Fiscal 2014 Budget Proposal for the U S  Air Force , 113 th Cong , 1 st sess , May 8, 2013 (Washington, DC: GPO, 2013)  U S  Congress, House Appropriations Committee, Subcommittee on Defense, President Obama's Fiscal 2014 Budget Proposal for the U S  Air Force , 113 th Cong , 1 st sess , May 9, 2013 (Washington, DC: GPO, 2013)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for Fiscal Year 2014 , 113th Cong , 1 st sess , May 22, 2013 (Washington, DC: GPO, 2013)  U S  Congress, Senate Armed Services Committee, Pending Legislation Regarding Sexual Assaults in the Military , 113 th Cong , 1 st sess , June 4, 2013, S  Hrg  113–320 (Washington, DC: GPO, 2013)  U S  Congress, Senate Armed Services Committee, Subcommittee on Personnel, Markup of the National Defense Authorization Act for Fiscal Year 2014 , 113 th Cong , 1 st sess , June 11, 2013 (Washington, DC: GPO, 2013)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for Fiscal Year 2014 , 113th Cong , 1 st sess , June 11, 2013 (Washington, DC: GPO, 2013)  U S  Congress, House Armed Services Committee, Subcommittee on Military Personnel, Women in Service Review s , 113 th Cong , 1 st sess , July 24, 2013, H A S C  No  113–50 (Washington, DC: GPO, 2013)  U S  Congress , Senate Armed Services Committee, Subcommittee on Personnel, The Relationships Between Military Sexual Assault, Post-Traumatic Stress Disorder and Suicide, and on Department of Defense and Department of Veterans Affairs Medical Treatment and Management of Victims of Sexual Trauma , 113 th Cong , 2 nd sess , February 26, 2014, S  Hrg  113-480 (Washington, DC: GPO, 2013)   U S  Congress, Armed Services Committee , Fiscal Year 2015 National Defense Authorization Budget Request from the Department of Defense , 113 th Cong , 2 nd sess , March 6 , 2014 (Washington, DC: GPO, 2014)  U S  Congress, House Armed Services Committee, Fiscal Year 2015 National Defense Authorization Budget Request from the Department of the Navy , 113 th Cong , 2 nd sess , March 12 , 2014 (Washington, DC: GPO, 2014)  U S  Congress, House Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for 2015, Part 1 , 113 th Cong , 2 nd sess , March 13, 2014 (Washington, DC: GPO, 2014)  U S  Congress, House Armed Services Committee , Fiscal Year 2015 National Defense Authorization Budget Request from the Department of the Air Force , 113 th Cong  , 2 nd sess , March 14, 2014 (Washington, DC: GPO, 2014)  U S  Congress, House Armed Services Committee , Fiscal Year 2015 National Defense Authorization Budget Request from the Department of the Army , 113 th Cong , 2 nd sess , March 25 , 2014 (Washington, DC: GPO, 2014)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense , Department of Defense Appropriations for 2015 , 113th Cong , 2 nd sess , March 26 , 2014 (Washington, DC: GPO, 2014)  U S  Congress, House Appropriations Committee, Subcommittee , Department of Defense Appropriations for 2015 , Part 2, 113 th Cong , 2 nd sess , April 2, 2014, (Washington, DC: GPO, 2014)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense , Department of Defense Appropriations for 2015 , 113th Cong , 2 nd sess , April 2 , 2014 (Washington, DC: GPO, 2014)  U S  Congress, House Armed Services Committee , National Defense Priorities from the Members for the Fiscal Year 2015 National Defense Authorization Act , 113 th Cong  , 2 nd sess , April 9 , 2014 (Washington, DC: GPO, 2014)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for Fiscal Year 2015 , 113th Cong , 2 nd sess , April 9, 2014 (Washington, DC: GPO, 2014)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense, Department of Defense Appropriations for Fiscal Year 2015 , 113th Cong , 2 nd sess , April 30, 2014 (Washington, DC: GPO, 2014)  U S  Congress, Senate Appropriations Committee, Subcommittee on Defense , Department of Defense Appropriations for 2015 , 113th Cong , 2 nd sess , June 18 , 2014 (Washington, DC: GPO, 2014)  U S  Congress, Senate Armed Services Committee , Department of Defense Authorization for Appropriations for Fiscal Year 2016 and the Future Years Defense Program , Part 1 , 114th Cong , 1 st sess , March 3 , 10 , 12 , 18 , 19, 26, April 4, 30 , 2015 (Washington, DC: GPO, 2015)  U S  Congress, Senate Armed Services , Department of Defense Authorization for Appropriations for Fiscal Year 2016 and the Future Years Defense Program , Part 7 Strategic Forces, 114 th Cong , 1 st sess , March 4, 25, April 15, 22, 29 , 2015 (Washington, DC: GPO, 2015)  U S  Congress, Senate Armed Services Committee, Department of Defense Authorization for Appropriations for Fiscal Year 2016 and the Future Years Defense Program , Part 3 Readiness and Management Support, 114 th Cong , 1 st sess , March 11, 25, April 22, 2015 (Washington, DC: GPO, 2015)  U S  Congress, Senate Armed Services Committee, The Current State of Readiness of U S  Forces in Review of the Defense Authorization Request for Fiscal Year 2016 and the Future Years Defense Program , 114 th Cong , 1 st sess , March 25, 2015 (Washington, DC: GPO, 2015)  U S  Congress, Senate Armed Services Committee, Department of Defense Authorization for Appropriations for Fiscal Year 2017 and the Future Years Defense Program , Part 1 , 114 th Cong , 2 nd sess , February 11, 23, March 3, 10, 15, 17, April 5, 7, 26, 2016 (Washington, DC: GPO, 2016)  U S  Congress, House Armed Services Committee, The Fiscal Year 2017 Na tional Defense Authorization Budget Request from the Department of Defense , 114 th Cong , 2 nd sess , March 22, 2016 (Washington, DC: GPO, 2016)  U S  Congress, Senate Armed Services Committee, Subcommittee on Strategic Forces, The Current State of Research, Diagnosis, and Treatment for Post-Traumatic Stress Disorder and Traumatic Brain Injury , 114 th Cong , 2 nd sess , April 20, 2016 (Washington, DC: GPO, 2016)  U S  Congress, House Committee on Armed Services, National Defense Authorization Act for Fiscal Year 2014 on H R 1960 with Additional and Dissenting Views, 113 th Cong , 1 st sess , H  Rept  113-102 (Washington, DC: GPO, 2013)  U S  Congress, House Committee on Appropriations, Department of Defense Appropriations Bill, 2014 to Accompany H R  2397 together with Additional Views, 113 th Cong , 1 st sess , H  Rept  113-113 (Washington, DC: GPO, 2013)  U S  Congress, Senate Committee on Armed Services, National Defense Authorization Act for Fiscal Year 2014 to accompany S  1197, 113 th Cong , 1 st sess , S  Rept  113-44 (Washington, DC: GPO, 2013)  U S  Congress, Senate Committee on Appropriations, Department of Defense Appropriations Bill, 2014 to accompany S 1429, 113 th Cong , 1 st sess , S  Rept  113-85 (Washington, DC: GPO, 2013)  U S  Congress, House Committee on Armed Services, First Annual Report on the Activities of the Committee on Armed Services for the One Hundred Thirteenth Congress , 113 th Cong , 1 st sess , H  Rept  113-309 (Washington, DC: GPO, 2013)  U S  Congress, House Committee on Armed Services, Howard P  "Buck" McKeon National Defense Authorization Act for Fiscal Year 2015 to accompany H R 4435, 113 th Cong, 2 nd sess , H  Rept  113-446 (Washington, DC: GPO, 2014)  U S  Congress, House Committee on Armed Services, Howard P  "Buck" McKeon National Defense Authorization Act for Fiscal Year 2015 supplemental report to accompany H R 4435, 113 th Cong  2 nd sess , H  Rept  113-446 part 2 (Washington, DC: GPO, 2014)  U S  Congress, Senate Committee on Armed Services, Carl Levin National Defense Authorization Act for Fiscal Year 2015 to accompany S 2410, 113 th Cong, 2 nd sess , S  Rept  113-176 (Washington, DC: GPO, 2014)  U S  Congress, House Committee on Appropriations, Department of Defense Appropriations Bill, 2015 to accompany H R 4870, 113 th Cong , 2 nd sess , H  Rept  113-473 (Washington, DC: GPO, 2014)  U S  Congress, Senate Committee on Appropriations, Department of Defense Appropriations Bill, 2015 to accompany H R 4870, 113 th Cong , 2 nd sess , S  Rept  113-211 (Washington, DC: GPO, 2014)  U S  Congress, House Committee on Armed Service, National Defense Authorization Act for Fiscal Year 2016 to accompany H R 1735, 114 th Cong , 1 st sess , H  Rept  114-102 (Washington, DC: GPO, 2015)  U S  Congress, Senate Committee on Armed Services, National Defense Authorization Act for Fiscal Year 2016 to accompany S 1376, 114 th Cong , 1 st sess , S  Rept  114-49 (Washington, DC: GPO, 2015)  U S  Congress, House Committee on Appropriations, Department of Defense Appropriations Bill, 2016 to accompany H R 2685, 114 th Cong , 1 st sess , H  Rept  114-139 (Washington, DC: GPO, 2015)  U S  Congress, Senate Committee on Appropriations, Department of Defense Appropriations Bill, 2016 to accompany S 1558, 114 th Cong , 1 st sess , S  Rept  114-63 (Washington, DC: GPO, 2015)  U S  Congress, House Conference Report, National Defense Authorization Act for Fiscal Year 2016 to accompany H R 1735, 114 th Cong , 1 st sess , H  Rept  114-270 (Washington, DC: GPO, 2015)  U S  Congress, House Committee on Armed Services, National Defense Authorization Act for Fiscal Year 2017 on H R 4909, 114 th Cong , 2 nd sess , H  Rept  114-537 (Washington, DC: GPO, 2016)  U S  Congress, Committee on Armed Services, National Defense Authorization Act for Fiscal Year 2017 to accompany S 2943, 114 th Cong, 2 nd sess , S  Rept  114-255 (Washington, DC: GPO, 2016)  U S  Congress, House Committee on Appropriations, Department of Defense Appropriations Bill, 2017 to accompany H R 5293, 114 th Cong , 2 nd sess , H  Rept  114-577 (Washington, DC: GPO, 2016)  U S  Congress, Senate Committee on Appropriations, Department of Defense Appropriations Bill, 2017 to accompany S 3000, 114 th Cong , 2 nd sess , S  Rept  114-263 (Washington, DC: GPO, 2016)  U S  Congress, House Conference Report, National Defense Authorization Act for Fiscal Year 2017 to accompany S  2943, 114 th Cong, 2 nd sess , H  Rept  114-840 (Washington, DC: GPO, 2016) 

ground_truth: Medicare is a federal program that pays for covered health care services of qualified beneficiaries. It was established in 1965 under Title XVIII of the Social Security Act to provide health insurance to individuals 65 and older, and has been expanded over the years to include permanently disabled individuals under the age of 65. Medicare, which consists of four parts (A-D), covers hospitalizations, physician services, prescription drugs, skilled nursing facility care, home health visits, and hospice care, among other services. Generally, individuals are eligible for Medicare if they or their spouse worked for at least 40 quarters in Medicare-covered employment, are 65 years old, and are a citizen or permanent resident of the United States. Individuals may also qualify for coverage if they are a younger person who cannot work because they have a medical condition that is expected to last at least one year or result in death, or have end-stage renal disease (permanent kidney failure requiring dialysis or transplant). The program is administered by the Centers for Medicare & Medicaid Services (CMS) within the Department of Health and Human Services (HHS) and by private entities that contract with CMS to provide claims processing, auditing, and quality oversight services. In FY2019, the program is expected to cover approximately 61 million persons (52 million aged and 9 million disabled) at a total cost of about $772 billion. Spending under the program (except for a portion of administrative costs) is considered mandatory spending and is not subject to the annual appropriations process. Services provided under Parts A and B (also referred to as "original" or "traditional" Medicare) are generally paid directly by the government on a "fee-for-service" basis, using different prospective payment systems or fee schedules. Under Parts C and D, private insurers are paid a monthly "capitated" amount to provide enrollees with required benefits. Medicare is required to pay for all covered services provided to eligible persons, so long as specific criteria are met. Since 1965, the Medicare program has undergone considerable change. For example, during the 111th Congress, the Patient Protection and Affordable Care Act (ACA; P.L. 111-148 and P.L. 111-152) made numerous changes to the Medicare program that modified provider reimbursements, provided incentives to increase the quality and efficiency of care, and enhanced certain Medicare benefits. In the 114th Congress, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA; P.L. 114-10) changed the method for calculating updates to Medicare payment rates to physicians and altered how physicians and other practitioners will be paid in the future. Projections of future Medicare expenditures and funding indicate that the program will place increasing financial demands on the federal budget and on beneficiaries. For example, the Hospital Insurance (Part A) trust fund is projected to become insolvent in 2026. Additionally, although the Supplementary Medical Insurance (Parts B and D) trust fund is financed in large part through federal general revenues and cannot become insolvent, associated spending growth is expected to put increasing strains on the country's competing spending priorities. As such, Medicare is expected to be a high-priority issue in the current Congress, and Congress may consider a variety of Medicare reform options ranging from further modifications of provider payment mechanisms to redesigning the entire program. This report provides a general overview of the Medicare program including descriptions of the program's history, eligibility criteria, covered services, provider payment systems, and program administration and financing. A list of commonly used acronyms, as well as information on beneficiary cost sharing, may be found in the appendixes.