‘‘(H) NOTICE
OF
CHANGES.—The Sec-
retary shall provide timely notice to bene-
ficiaries and health professionals about changes 
to the formulary or formulary incentives. 
‘‘(f) INFORMING
BENEFICIARIES.—The Secretary 
shall take steps to inform beneficiaries about the avail-
ability of a Medicare operated drug plan or plans including 
providing information in the annual handbook distributed 
to all beneficiaries and adding information to the official 
public Medicare Web site related to prescription drug cov-
erage available through this part. 
‘‘(g) APPLICATION OF ALL OTHER REQUIREMENTS 
FOR PRESCRIPTION DRUG PLANS.—Except as specifically 
provided in this section, any Medicare operated drug plan 
shall meet the same requirements as apply to any other 
prescription drug plan, including the requirements of sec-
tion 1860D–4(b)(1) relating to assuring pharmacy ac-
cess).’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1860D–3(a) of the Social Security 
Act (42 U.S.C. 1395w–103(a)) is amended by add-
ing at the end the following new paragraph: 
‘‘(4) AVAILABILITY OF THE MEDICARE OPER-
ATED PRESCRIPTION DRUG PLAN.—A Medicare op-
erated prescription drug plan (as defined in section 
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1860D–11A(c)) shall be offered nationally in accord-
ance with section 1860D–11A.’’. 
(2)(A) Section 1860D–3 of the Social Security 
Act (42 U.S.C. 1395w–103) is amended by adding 
at the end the following new subsection: 
‘‘(c) PROVISIONS
ONLY
APPLICABLE
IN
2006 
THROUGH 2013.—The provisions of this section shall only 
apply with respect to 2006 through 2013.’’. 
(B) Section 1860D–11(g) of such Act (42 
U.S.C. 1395w–111(g)) is amended by adding at the 
end the following new paragraph: 
‘‘(8) NO
AUTHORITY
FOR
FALLBACK
PLANS 
AFTER 2013.—A fallback prescription drug plan shall 
not be available after December 31, 2013.’’. 
(3) Section 1860D–13(c)(3) of the Social Secu-
rity Act (42 U.S.C. 1395w–113(c)(3)) is amended— 
(A) in the heading, by inserting ‘‘AND 
MEDICARE
OPERATED
PRESCRIPTION
DRUG 
PLANS’’ after ‘‘FALLBACK PLANS’’; and 
(B) by inserting ‘‘or a Medicare operated 
prescription drug plan’’ after ‘‘a fallback pre-
scription drug plan’’. 
(4) Section 1860D–16(b)(1) of the Social Secu-
rity Act (42 U.S.C.1395w–116(b)(1)) is amended— 
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(A) in subparagraph (C), by striking 
‘‘and’’ after the semicolon at the end; 
(B) in subparagraph (D), by striking the 
period at the end and inserting ‘‘; and’’; and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(E) payments for expenses incurred with 
respect to the operation of Medicare operated 
prescription drug plans under section 1860D– 
11A.’’. 
(5) Section 1860D–41(a) of the Social Security 
Act (42 U.S.C. 1395w–151(a)) is amended by add-
ing at the end the following new paragraph: 
‘‘(19) MEDICARE
OPERATED
PRESCRIPTION 
DRUG PLAN.—The term ‘Medicare operated prescrip-
tion drug plan’ has the meaning given such term in 
section 1860D–11A(c).’’. 
SEC. 3. IMPROVED APPEALS PROCESS UNDER THE MEDI-
CARE OPERATED PRESCRIPTION DRUG PLAN. 
Section 1860D–4(h) of the Social Security Act (42 
U.S.C. 1305w–104(h)) is amended by adding at the end 
the following new paragraph: 
‘‘(4) APPEALS PROCESS FOR MEDICARE OPER-
ATED PRESCRIPTION DRUG PLAN.— 
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‘‘(A) IN
GENERAL.—The Secretary shall 
develop a well-defined process for appeals for 
denials of benefits under this part under the 
Medicare operated prescription drug plan. Such 
process shall be efficient, impose minimal ad-
ministrative burdens, and ensure the timely 
procurement of non-formulary drugs or exemp-
tion from formulary incentives when medically 
necessary. Medical necessity shall be based on 
professional medical judgment, the medical con-
dition of the beneficiary, and other medical evi-
dence. Such appeals process shall include— 
‘‘(i) an initial review and determina-
tion made by the Secretary; and 
‘‘(ii) for appeals denied during the ini-
tial review and determination, the option of 
an external review and determination by 
an independent entity selected by the Sec-
retary. 
‘‘(B) CONSULTATION IN DEVELOPMENT OF 
PROCESS.—In developing the appeals process 
under subparagraph (A), the Secretary shall 
consult with consumer and patient groups, as 
well as other key stakeholders to ensure the 
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goals described in subparagraph (A) are 
achieved.’’. 
Æ 
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