II 

111TH CONGRESS 

1ST SESSION S. 1079 

To amend title XVIII of the Social Security Act to extend reasonable cost 

contracts under the Medicare program. 

IN THE SENATE OF THE UNITED STATES 

MAY 19, 2009 

Ms. KLOBUCHAR (for herself, Mr. VOINOVICH, Mr. INOUYE, Mr. UDALL of 

Colorado, and Mr. BENNET) introduced the following bill; which was read 

twice and referred to the Committee on Finance 

A BILL 

To amend title XVIII of the Social Security Act to extend 

reasonable cost contracts under the Medicare program. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Medicare Cost Con5 tract Extension and Refinement Act of 2009’’. 

6 SEC. 2. EXTENSION OF REASONABLE COST CONTRACTS. 

7 (a) EXTENSION OF PERIOD REASONABLE COST

8 PLANS CAN REMAIN IN THE MARKET.—Section 

9 1876(h)(5)(C) of the Social Security Act (42 U.S.C. 

10 1395mm(h)(5)(C)) is amended— 


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1 (1) in clause (ii), by striking ‘‘January 1, 

2 2010’’ and inserting ‘‘January 1, 2013’’; and 

3 (2) in clause (iii), in the matter preceding sub4 clause (I), by striking ‘‘if the service area for the 

5 year meets’’ and inserting ‘‘if the portion of the 

6 plan’s service area for the year that is within the 

7 service area of a reasonable cost reimbursement con8 tract meets’’. 

9 (b) EXTENSION OF PERIOD REASONABLE COST

10 PLANS CAN EXPAND THEIR SERVICE AREA.—Section 

11 1876(h)(5)(B)(i) of the Social Security Act (42 U.S.C. 

12 1395mm(h)(5)(B)(i)) is amended to read as follows: 

13 ‘‘(i) the conditions for prohibiting an extension 

14 or renewal of a contract under subparagraph (C)(ii) 

15 are not applicable to such service area at the time 

16 of the application; and’’. 

17 SEC. 3. APPLICATION OF CERTAIN MEDICARE ADVANTAGE 

18 REQUIREMENTS TO COST CONTRACTS EX19 TENDED OR RENEWED AFTER DATE OF EN20 ACTMENT. 

21 Section 1876(h) of the Social Security Act (42 U.S.C. 

22 1395mm(h)), as amended by section (2), is amended— 

23 (1) by redesignating paragraph (5) as para24 graph (6); and 


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1 (2) by inserting after paragraph (4) the fol2 lowing new paragraph: 

3 ‘‘(5)(A) Any reasonable cost reimbursement contract 

4 with an eligible organization under this subsection that is 

5 extended or renewed on or after the date of the enactment 

6 of the Medicare Cost Contract Extension and Refinement 

7 Act of 2009 shall provide that the provisions of the Medi8 care Advantage program under part C described in sub9 paragraph (B) shall apply to such organization and such 

10 contract in a substantially similar manner as such provi11 sions apply to Medicare Advantage organizations and 

12 Medicare Advantage plans under such part. 

13 ‘‘(B) The provisions described in this subparagraph 

14 are as follows: 

15 ‘‘(i) Section 1851(d) (relating to the provision 

16 of information to promote informed choice). 

17 ‘‘(ii) Section 1851(h) (relating to the approval 

18 of marketing material and application forms). 

19 ‘‘(iii) Section 1852(a)(3)(A) (regarding the au20 thority of organizations to include mandatory sup21 plemental health care benefits under the plan subject 

22 to the approval of the Secretary). 

23 ‘‘(iv) Section 1852(e) (relating to the require24 ment of having an ongoing quality improvement pro25 gram and treatment of accreditation in the same 


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1 manner as such provisions apply to Medicare Advan2 tage local plans that are preferred provider organiza3 tion plans). 

4 ‘‘(v) Section 1852(j)(4) (relating to limitations 

5 on physician incentive plans). 

6 ‘‘(vi) Section 1854(g) (relating to restrictions 

7 on imposition of premium taxes with respect to pay8 ments to organizations). 

9 ‘‘(vii) Section 1856(b)(3) (relating to relation to 

10 State laws). 

11 ‘‘(viii) Section 1857(i) (relating to Medicare 

12 Advantage program compatibility with employer or 

13 union group health plans). 

14 ‘‘(ix) The provisions of part C relating to 

15 timelines for contract renewal and beneficiary notifi16 cation.’’. 

Æ 


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