I 
108TH CONGRESS 
1ST SESSION H. R. 2070
To amend title XVIII of the Social Security Act to revitalize and improve 
the Medicare+Choice program. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 13, 2003
Mr. GREENWOOD (for himself, Mr. ISRAEL, and Mr. FOSSELLA) introduced 
the following bill; which was referred to the Committee on Ways and 
Means, and in addition to the Committee on Energy and Commerce, for 
a period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the com-
mittee concerned 
A BILL 
To amend title XVIII of the Social Security Act to revitalize 
and improve the Medicare+Choice program.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Medicare+Choice Re-
vitalization Act of 2003’’. 
SEC. 2. MEDICARE+CHOICE IMPROVEMENTS. 
(a) EQUALIZING PAYMENTS BETWEEN FEE-FOR-
SERVICE AND MEDICARE+CHOICE.—
(1) IN
GENERAL.—Section 1853(c)(1) of the 
Social Security Act (42 U.S.C. 1395w–23(c)(1)) is 
amended by adding at the end the following: 
‘‘(D) BASED
ON
100
PERCENT
OF
FEE-
FOR-SERVICE COSTS.—
‘‘(i) IN GENERAL.—For 2004 and any 
subsequent year, the adjusted average per 
capita cost for the year involved, deter-
mined under section 1876(a)(4) for the 
Medicare+Choice payment area for serv-
ices covered under parts A and B for indi-
viduals entitled to benefits under part A 
and enrolled under part B who are not en-
rolled in a Medicare+Choice plan under 
this part for the year. 
‘‘(ii) INCLUSION OF COSTS OF VA AND 
DOD
MILITARY
FACILITY
SERVICES
TO 
MEDICARE-ELIGIBLE
BENEFICIARIES.—In 
determining the adjusted average per cap-
ita cost under clause (i) for a year, such 
cost shall be adjusted to include the Sec-
retary’s estimate, on a per capita basis, of 
the amount of additional payments that 
would have been made in the area involved 
under this title if individuals entitled to
benefits under this title had not received 
services from facilities of the Department 
of Veterans Affairs or the Department of 
Defense.’’. 
(2) CONFORMING AMENDMENT.—Such section 
is further amended, in the matter before subpara-
graph (A), by striking ‘‘or (C)’’ and inserting ‘‘(C), 
or (D)’’. 
(b) REVISION OF BLEND.—
(1) REVISION OF NATIONAL AVERAGE USED IN 
CALCULATION
OF
BLEND.—Section 
1853(c)(4)(B)(i)(II) of such Act (42 U.S.C. 1395w–
23(c)(4)(B)(i)(II)) is amended by inserting ‘‘who 
(with respect to determinations for 2004 and any 
subsequent year) are enrolled in a Medicare+Choice 
plan’’ after ‘‘the average number of medicare bene-
ficiaries’’. 
(2) CHANGE IN BUDGET NEUTRALITY.—Section 
1853(c) of such Act (42 U.S.C. 1395w–23(c)) is 
amended—
(A) in paragraph (1)(A), by inserting ‘‘(for 
a year before 2003)’’ after ‘‘multiplied’’; and 
(B) in paragraph (5), by inserting ‘‘(before 
2003)’’ after ‘‘for each year’’.
(c) REVISION
IN
MINIMUM
PERCENTAGE
IN-
CREASE.—Section 1853(c)(1)(C) of such Act (42 U.S.C. 
1395w–23(c)(1)(C)) is amended by striking clause (iv) 
and inserting the following: 
‘‘(iv) For 2002 and 2003, 102 percent 
of the annual Medicare+Choice capitation 
rate under this paragraph for the area for 
the previous year. 
‘‘(v) For 2004 and each succeeding 
year, 
104 
percent 
of 
the 
annual 
Medicare+Choice capitation rate under 
this paragraph for the area for the pre-
vious year.’’. 
(d) INCLUSION OF COSTS OF DOD AND VA MILI-
TARY
FACILITY
SERVICES
TO
MEDICARE-ELIGIBLE 
BENEFICIARIES IN CALCULATION OF MEDICARE+CHOICE 
PAYMENT RATES.—Section 1853(c)(3) of such Act (42 
U.S.C. 1395w–23(c)(3)) is amended—
(1) in subparagraph (A), by striking ‘‘subpara-
graph (B)’’ and inserting ‘‘subparagraphs (B) and 
(E)’’, and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(E) INCLUSION OF COSTS OF DOD AND 
VA MILITARY FACILITY SERVICES TO MEDICARE-
ELIGIBLE BENEFICIARIES.—In determining the 
area-specific Medicare+Choice capitation rate 
under subparagraph (A) for a year (beginning 
with 2004), the annual per capita rate of pay-
ment for 1997 determined under section 
1876(a)(1)(C) shall be adjusted to include in 
the rate the Secretary’s estimate, on a per cap-
ita basis, of the amount of additional payments 
that would have been made in the area involved 
under this title if individuals entitled to benefits 
under this title had not received services from 
facilities of the Department of Defense or the 
Department of Veterans Affairs.’’. 
(e) 
ANNOUNCEMENT
OF
REVISED 
MEDICARE+CHOICE PAYMENT RATES.—Within 4 weeks 
after the date of the enactment of this Act, the Secretary 
shall determine, and shall announce (in a manner intended 
to provide notice to interested parties) Medicare+Choice 
capitation rates under section 1853 of the Social Security 
Act (42 U.S.C. 1395w–23) for 2004, revised in accordance 
with the provisions of this section. 
(f) MEDPAC STUDY OF AAPCC.—
(1) STUDY.—The Medicare Payment Advisory 
Commission shall conduct a study that assesses the 
method used for determining the adjusted average
per capita cost (AAPCC) under section 1876(a)(4) 
of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1395mm(a)(4)). Such study shall examine—
(A) the bases for variation in such costs 
between different areas, including differences in 
input prices, utilization, and practice patterns; 
(B) the appropriate geographic area for 
payment under the Medicare+Choice program 
under part C of title XVIII of such Act; and 
(C) the accuracy of risk adjustment meth-
ods in reflecting differences in costs of pro-
viding care to different groups of beneficiaries 
served under such program. 
(2) REPORT.—Not later than 9 months after 
the date of the enactment of this Act, the Commis-
sion shall submit to Congress a report on the study 
conducted under paragraph (1). Such report shall 
include recommendations regarding changes in the 
methods for computing the adjusted average per 
capita cost among different areas. 
(g) REPORT ON IMPACT OF INCREASED FINANCIAL 
ASSISTANCE TO MEDICARE+CHOICE PLANS.—Not later 
than July 1, 2004, the Secretary of Health and Human 
Services shall submit to Congress a report that describes 
the impact of additional financing provided under this Act
and other Acts (including the Medicare, Medicaid, and 
SCHIP Balanced Budget Refinement Act of 1999 and 
BIPA) on the availability of Medicare+Choice plans in 
different areas and its impact on lowering premiums and 
increasing benefits under such plans.
SEC. 
3. 
MAKING 
PERMANENT 
CHANGE 
IN 
MEDICARE+CHOICE REPORTING DEADLINES 
AND ANNUAL, COORDINATED ELECTION PE-
RIOD. 
(a) CHANGE
IN REPORTING DEADLINE.—Section 
1854(a)(1) of the Social Security Act (42 U.S.C. 1395w–
24(a)(1)) is amended by striking ‘‘2002, 2003, and 2004 
(or July 1 of each other year)’’ and inserting ‘‘2002 and 
each subsequent year (or July 1 of each year before 
2002)’’. 
(b) DELAY IN ANNUAL, COORDINATED ELECTION 
PERIOD.—Section 1851(e)(3)(B) of such Act (42 U.S.C. 
1395w–21(e)(3)(B)) is amended by striking ‘‘and after 
2005, the month of November before such year and with 
respect to 2003, 2004, and 2005’’ and inserting ‘‘, the 
month of November before such year and with respect to 
2003 and any subsequent year’’. 
(c) 
ANNUAL
ANNOUNCEMENT
OF
PAYMENT 
RATES.—Section 1853(b)(1) of such Act (42 U.S.C. 
1395w–23(b)(1)) is amended by striking ‘‘and after 2005
not later than March 1 before the calendar year concerned 
and for 2004 and 2005’’ and inserting ‘‘not later than 
March 1 before the calendar year concerned and for 2004 
and each subsequent year’’. 
(d) REQUIRING PROVISION OF AVAILABLE INFORMA-
TION COMPARING PLAN OPTIONS.—The first sentence of 
section 1851(d)(2)(A)(ii) of such Act (42 U.S.C. 1395w–
21(d)(2)(A)(ii)) is amended by inserting before the period 
the following: ‘‘to the extent such information is available 
at the time of preparation of materials for the mailing’’. 
SEC. 4. AVOIDING DUPLICATIVE STATE REGULATION. 
(a) IN GENERAL.—Section 1856(b)(3) of the Social 
Security Act (42 U.S.C. 1395w–26(b)(3)) is amended to 
read as follows: 
‘‘(3) RELATION TO STATE LAWS.—The stand-
ards established under this subsection shall super-
sede any State law or regulation (other than State 
licensing laws or State laws relating to plan sol-
vency) with respect to Medicare+Choice plans which 
are offered by Medicare+Choice organizations under 
this part.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall take effect on the date of the enact-
ment of this Act.
SEC. 5. SPECIALIZED MEDICARE+CHOICE PLANS FOR SPE-
CIAL NEEDS BENEFICIARIES. 
(a) TREATMENT AS COORDINATED CARE PLAN.—
Section 1851(a)(2)(A) of the Social Security Act (42 
U.S.C. 1395w–21(a)(2)(A)) is amended by adding at the 
end 
the 
following 
new 
sentence: 
‘‘Specialized 
Medicare+Choice plans for special needs beneficiaries (as 
defined in section 1859(b)(4)) may be any type of coordi-
nated care plan.’’. 
(b) SPECIALIZED MEDICARE+CHOICE PLAN
FOR 
SPECIAL
NEEDS
BENEFICIARIES
DEFINED.—Section 
1859(b) of such Act (42 U.S.C. 1395w–29(b)) is amended 
by adding at the end the following new paragraph: 
‘‘(4) SPECIALIZED
MEDICARE+CHOICE
PLANS 
FOR SPECIAL NEEDS BENEFICIARIES.—
‘‘(A) IN GENERAL.—The term ‘specialized 
Medicare+Choice plan for special needs bene-
ficiaries’ means a Medicare+Choice plan that 
exclusively serves special needs beneficiaries (as 
defined in subparagraph (B)). 
‘‘(B) SPECIAL NEEDS BENEFICIARY.—The 
term ‘special needs beneficiary’ means a 
Medicare+Choice eligible individual who—
‘‘(i) is institutionalized (as defined by 
the Secretary);
‘‘(ii) is entitled to medical assistance 
under a State plan under title XIX; 
‘‘(iii) is residing in a Continuing Care 
Retirement Community (as defined in sec-
tion 1852(l)(4)(B); or 
‘‘(iv) meets such requirements as the 
Secretary may determine would benefit 
from enrollment in such a specialized 
Medicare+Choice plan described in sub-
paragraph (A) for individuals with severe 
or disabling chronic conditions.’’. 
(c) RESTRICTION ON ENROLLMENT PERMITTED.—
Section 1859 of such Act (42 U.S.C. 1395w–29) is 
amended by adding at the end the following new sub-
section: 
‘‘(f) RESTRICTION ON ENROLLMENT FOR SPECIAL-
IZED MEDICARE+CHOICE PLANS FOR SPECIAL NEEDS 
BENEFICIARIES.—In 
the 
case 
of 
a 
specialized 
Medicare+Choice plan (as defined in subsection (b)(4)), 
notwithstanding any other provision of this part and in 
accordance with regulations of the Secretary and for peri-
ods before January 1, 2007, the plan may restrict the en-
rollment of individuals under the plan to individuals who 
are within one or more classes of special needs bene-
ficiaries.’’.
(d) REPORT TO CONGRESS.—Not later than Decem-
ber 31, 2006, the Medicare Benefits Administrator shall 
submit to Congress a report that assesses the impact of 
specialized Medicare+Choice plans for special needs bene-
ficiaries on the cost and quality of services provided to 
enrollees. Such report shall include an assessment of the 
costs and savings to the medicare program as a result of 
amendments made by subsections (a), (b), and (c). 
(e) EFFECTIVE DATES.—
(1) IN GENERAL.—The amendments made by 
subsections (a), (b), and (c) shall take effect upon 
the date of the enactment of this Act. 
(2) DEADLINE
FOR
ISSUANCE
OF
REQUIRE-
MENTS FOR SPECIAL NEEDS BENEFICIARIES; TRAN-
SITION.—No later than 6 months after the date of 
the enactment of this Act, the Secretary of Health 
and Human Services shall issue final regulations to 
establish requirements for special needs beneficiaries 
under section 1859(b)(4)(B)(iii) of the Social Secu-
rity Act, as added by subsection (b).
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