H. R. 2015—281
or scope and without application of deductibles, copay-
ments, coinsurance, or other cost-sharing that would
otherwise apply under this title or such title, respec-
tively; and
‘‘(ii) all additional items and services specified in
regulations, based upon those required under the
PACE protocol;
‘‘(B) provide such enrollees access to necessary covered
items and services 24 hours per day, every day of the
year;
‘‘(C) provide services to such enrollees through a com-
prehensive, multidisciplinary health and social services
delivery system which integrates acute and long-term care
services pursuant to regulations; and
‘‘(D) specify the covered items and services that will
not be provided directly by the entity, and to arrange
for delivery of those items and services through contracts
meeting the requirements of regulations.
‘‘(2) QUALITY
ASSURANCE; 
PATIENT
SAFEGUARDS.—The
PACE program agreement shall require the PACE provider
to have in effect at a minimum—
‘‘(A) a written plan of quality assurance and improve-
ment, and procedures implementing such plan, in accord-
ance with regulations; and
‘‘(B) written safeguards of the rights of enrolled partici-
pants (including a patient bill of rights and procedures
for grievances and appeals) in accordance with regulations
and with other requirements of this title and Federal and
State law that are designed for the protection of patients.
‘‘(c) ELIGIBILITY DETERMINATIONS.—
‘‘(1) IN GENERAL.—The determination of whether an individ-
ual is a PACE program eligible individual—
‘‘(A) shall be made under and in accordance with the
PACE program agreement; and
‘‘(B) who is entitled to medical assistance under title
XIX, shall be made (or who is not so entitled, may be
made) by the State administering agency.
‘‘(2) CONDITION.—An individual is not a PACE program
eligible individual (with respect to payment under this section)
unless the individual’s health status has been determined by
the Secretary or the State administering agency, in accordance
with regulations, to be comparable to the health status of
individuals who have participated in the PACE demonstration
waiver programs. Such determination shall be based upon
information on health status and related indicators (such as
medical diagnoses and measures of activities of daily living,
instrumental activities of daily living, and cognitive impair-
ment) that are part of a uniform minimum data set collected
by PACE providers on potential PACE program eligible individ-
uals.
‘‘(3) ANNUAL ELIGIBILITY RECERTIFICATIONS.—
‘‘(A) IN GENERAL.—Subject to subparagraph (B), the
determination described in subsection (a)(5)(B) for an
individual shall be reevaluated at least annually.
‘‘(B) EXCEPTION.—The requirement of annual reevalua-
tion under subparagraph (A) may be waived during a period
in accordance with regulations in those cases where the
H. R. 2015—282
State administering agency determines that there is no
reasonable expectation of improvement or significant
change in an individual’s condition during the period
because of the severity of chronic condition, or degree of
impairment of functional capacity of the individual
involved.
‘‘(4) CONTINUATION OF ELIGIBILITY.—An individual who is
a PACE program eligible individual may be deemed to continue
to be such an individual notwithstanding a determination that
the individual no longer meets the requirement of subsection
(a)(5)(B) if, in accordance with regulations, in the absence of
continued coverage under a PACE program the individual
reasonably would be expected to meet such requirement within
the succeeding 6-month period.
‘‘(5) ENROLLMENT; DISENROLLMENT.—
‘‘(A) VOLUNTARY DISENROLLMENT AT ANY TIME.—The
enrollment and disenrollment of PACE program eligible
individuals in a PACE program shall be pursuant to regula-
tions and the PACE program agreement and shall permit
enrollees to voluntarily disenroll without cause at any time.
‘‘(B) LIMITATIONS ON DISENROLLMENT.—
‘‘(i) IN GENERAL.—Regulations promulgated by the
Secretary under this section and section 1934, and
the PACE program agreement, shall provide that the
PACE program may not disenroll a PACE program
eligible individual except—
‘‘(I) for nonpayment of premiums (if applicable)
on a timely basis; or
‘‘(II) for engaging in disruptive or threatening
behavior, as defined in such regulations (developed
in close consultation with State administering
agencies).
‘‘(ii) 
NO
DISENROLLMENT
FOR
NONCOMPLIANT
BEHAVIOR.—Except 
as 
allowed 
under 
regulations
promulgated to carry out clause (i)(II), a PACE pro-
gram may not disenroll a PACE program eligible
individual on the ground that the individual has
engaged in noncompliant behavior if such behavior
is related to a mental or physical condition of the
individual. For purposes of the preceding sentence,
the term ‘noncompliant behavior’ includes repeated
noncompliance with medical advice and repeated fail-
ure to appear for appointments.
‘‘(iii) TIMELY REVIEW OF PROPOSED NONVOLUNTARY
DISENROLLMENT.—A proposed disenrollment, other
than a voluntary disenrollment, shall be subject to
timely review and final determination by the Secretary
or by the State administering agency (as applicable),
prior to the proposed disenrollment becoming effective.
‘‘(d) PAYMENTS TO PACE PROVIDERS ON A CAPITATED BASIS.—
‘‘(1) IN GENERAL.—In the case of a PACE provider with
a PACE program agreement under this section, except as pro-
vided in this subsection or by regulations, the Secretary shall
make prospective monthly payments of a capitation amount
for each PACE program eligible individual enrolled under the
agreement under this section in the same manner and from
the same sources as payments are made to a Medicare+Choice
H. R. 2015—283
organization under section 1853 (or, for periods beginning
before January 1, 1999, to an eligible organization under a
risk-sharing contract under section 1876). Such payments shall
be subject to adjustment in the manner described in section
1853(a)(2) or section 1876(a)(1)(E), as the case may be.
‘‘(2) CAPITATION
AMOUNT.—The capitation amount to be
applied under this subsection for a provider for a contract
year shall be an amount specified in the PACE program agree-
ment for the year. Such amount shall be based upon payment
rates established for purposes of payment under section 1853
(or, for periods before January 1, 1999, for purposes of risk-
sharing contracts under section 1876) and shall be adjusted
to take into account the comparative frailty of PACE enrollees
and such other factors as the Secretary determines to be appro-
priate. Such amount under such an agreement shall be com-
puted in a manner so that the total payment level for all
PACE program eligible individuals enrolled under a program
is less than the projected payment under this title for a com-
parable population not enrolled under a PACE program.
‘‘(e) PACE PROGRAM AGREEMENT.—
‘‘(1) REQUIREMENT.—
‘‘(A) IN GENERAL.—The Secretary, in close cooperation
with the State administering agency, shall establish proce-
dures for entering into, extending, and terminating PACE
program agreements for the operation of PACE programs
by entities that meet the requirements for a PACE provider
under this section, section 1934, and regulations.
‘‘(B) NUMERICAL LIMITATION.—
‘‘(i) IN GENERAL.—The Secretary shall not permit
the number of PACE providers with which agreements
are in effect under this section or under section 9412(b)
of the Omnibus Budget Reconciliation Act of 1986 to
exceed—
‘‘(I) 40 as of the date of the enactment of
this section; or
‘‘(II) as of each succeeding anniversary of such
date, the numerical limitation under this subpara-
graph for the preceding year plus 20.
Subclause (II) shall apply without regard to the actual
number of agreements in effect as of a previous
anniversary date.
‘‘(ii) TREATMENT OF CERTAIN PRIVATE, FOR-PROFIT
PROVIDERS.—The numerical limitation in clause (i)
shall not apply to a PACE provider that—
‘‘(I) is operating under a demonstration project
waiver under subsection (h); or
‘‘(II) was operating under such a waiver and
subsequently qualifies for PACE provider status
pursuant to subsection (a)(3)(B)(ii).
‘‘(2) SERVICE AREA AND ELIGIBILITY.—
‘‘(A) IN
GENERAL.—A PACE program agreement for
a PACE program—
‘‘(i) shall designate the service area of the program;
‘‘(ii) may provide additional requirements for
individuals to qualify as PACE program eligible
individuals with respect to the program;
H. R. 2015—284
‘‘(iii) shall be effective for a contract year, but
may be extended for additional contract years in the
absence of a notice by a party to terminate and is
subject to termination by the Secretary and the State
administering agency at any time for cause (as pro-
vided under the agreement);
‘‘(iv) shall require a PACE provider to meet all
applicable State and local laws and requirements; and
‘‘(v) shall contain such additional terms and condi-
tions as the parties may agree to, so long as such
terms and conditions are consistent with this section
and regulations.
‘‘(B) SERVICE AREA OVERLAP.—In designating a service
area under a PACE program agreement under subpara-
graph (A)(i), the Secretary (in consultation with the State
administering agency) may exclude from designation an
area that is already covered under another PACE program
agreement, in order to avoid unnecessary duplication of
services and avoid impairing the financial and service
viability of an existing program.
‘‘(3) DATA COLLECTION; DEVELOPMENT OF OUTCOME MEAS-
URES.—
‘‘(A) DATA COLLECTION.—
‘‘(i) IN GENERAL.—Under a PACE program agree-
ment, the PACE provider shall—
‘‘(I) collect data;
‘‘(II) maintain, and afford the Secretary and
the State administering agency access to, the
records relating to the program, including perti-
nent financial, medical, and personnel records; and
‘‘(III) make available to the Secretary and the
State administering agency reports that the Sec-
retary finds (in consultation with State administer-
ing agencies) necessary to monitor the operation,
cost, and effectiveness of the PACE program under
this section and section 1934 .
‘‘(ii) REQUIREMENTS DURING TRIAL PERIOD.—During
the first 3 years of operation of a PACE program
(either under this section or under a PACE demonstra-
tion waiver program), the PACE provider shall provide
such additional data as the Secretary specifies in regu-
lations in order to perform the oversight required under
paragraph (4)(A).
‘‘(B) DEVELOPMENT OF OUTCOME MEASURES.—Under a
PACE program agreement, the PACE provider, the Sec-
retary, and the State administering agency shall jointly
cooperate in the development and implementation of health
status and quality of life outcome measures with respect
to PACE program eligible individuals.
‘‘(4) OVERSIGHT.—
‘‘(A) 
ANNUAL, 
CLOSE
OVERSIGHT
DURING
TRIAL
PERIOD.—During the trial period (as defined in subsection
(a)(9)) with respect to a PACE program operated by a
PACE provider, the Secretary (in cooperation with the State
administering agency) shall conduct a comprehensive
annual review of the operation of the PACE program by
H. R. 2015—285
the provider in order to assure compliance with the require-
ments of this section and regulations. Such a review shall
include—
‘‘(i) an on-site visit to the program site;
‘‘(ii) comprehensive assessment of a provider’s fis-
cal soundness;
‘‘(iii) comprehensive assessment of the provider’s
capacity to provide all PACE services to all enrolled
participants;
‘‘(iv) detailed analysis of the entity’s substantial
compliance with all significant requirements of this
section and regulations; and
‘‘(v) any other elements the Secretary or State
administering agency considers necessary or appro-
priate.
‘‘(B) CONTINUING OVERSIGHT.—After the trial period,
the Secretary (in cooperation with the State administering
agency) shall continue to conduct such review of the oper-
ation of PACE providers and PACE programs as may be
appropriate, taking into account the performance level of
a provider and compliance of a provider with all significant
requirements of this section and regulations.
‘‘(C) DISCLOSURE.—The results of reviews under this
paragraph shall be reported promptly to the PACE pro-
vider, along with any recommendations for changes to the
provider’s program, and shall be made available to the
public upon request.
‘‘(5) TERMINATION OF PACE PROVIDER AGREEMENTS.—
‘‘(A) IN GENERAL.—Under regulations—
‘‘(i) the Secretary or a State administering agency
may terminate a PACE program agreement for cause;
and
‘‘(ii) a PACE provider may terminate an agreement
after appropriate notice to the Secretary, the State
agency, and enrollees.
‘‘(B) CAUSES
FOR
TERMINATION.—In accordance with
regulations establishing procedures for termination of
PACE program agreements, the Secretary or a State
administering agency may terminate a PACE program
agreement with a PACE provider for, among other reasons,
the fact that—
‘‘(i) the Secretary or State administering agency
determines that—
‘‘(I) there are significant deficiencies in the
quality of care provided to enrolled participants;
or
‘‘(II) the provider has failed to comply substan-
tially with conditions for a program or provider
under this section or section 1934; and
‘‘(ii) the entity has failed to develop and success-
fully initiate, within 30 days of the date of the receipt
of written notice of such a determination, a plan to
correct the deficiencies, or has failed to continue
implementation of such a plan.
‘‘(C) TERMINATION AND TRANSITION PROCEDURES.—An
entity whose PACE provider agreement is terminated
H. R. 2015—286
under this paragraph shall implement the transition proce-
dures required under subsection (a)(2)(C).
‘‘(6) SECRETARY’S OVERSIGHT; ENFORCEMENT AUTHORITY.—
‘‘(A) IN GENERAL.—Under regulations, if the Secretary
determines (after consultation with the State administering
agency) that a PACE provider is failing substantially to
comply with the requirements of this section and regula-
tions, the Secretary (and the State administering agency)
may take any or all of the following actions:
‘‘(i) Condition the continuation of the PACE pro-
gram agreement upon timely execution of a corrective
action plan.
‘‘(ii) Withhold some or all further payments under
the PACE program agreement under this section or
section 1934 with respect to PACE program services
furnished by such provider until the deficiencies have
been corrected.
‘‘(iii) Terminate such agreement.
‘‘(B) APPLICATION OF INTERMEDIATE SANCTIONS.—Under
regulations, the Secretary may provide for the application
against a PACE provider of remedies described in section
1857(g)(2) (or, for periods before January 1, 1999, section
1876(i)(6)(B)) or 1903(m)(5)(B) in the case of violations
by the provider of the type described in section 1857(g)(1)
(or section 1876(i)(6)(A) for such periods) or 1903(m)(5)(A),
respectively (in relation to agreements, enrollees, and
requirements under this section or section 1934, respec-
tively).
‘‘(7) PROCEDURES FOR TERMINATION OR IMPOSITION OF SANC-
TIONS.—Under regulations, the provisions of section 1857(h)
(or for periods before January 1, 1999, section 1876(i)(9)) shall
apply to termination and sanctions respecting a PACE program
agreement and PACE provider under this subsection in the
same manner as they apply to a termination and sanctions
with respect to a contract and a Medicare+Choice organization
under part C (or for such periods an eligible organization under
section 1876).
‘‘(8) TIMELY CONSIDERATION OF APPLICATIONS FOR PACE PRO-
GRAM
PROVIDER
STATUS.—In considering an application for
PACE provider program status, the application shall be deemed
approved unless the Secretary, within 90 days after the date
of the submission of the application to the Secretary, either
denies such request in writing or informs the applicant in
writing with respect to any additional information that is
needed in order to make a final determination with respect
to the application. After the date the Secretary receives such
additional information, the application shall be deemed
approved unless the Secretary, within 90 days of such date,
denies such request.
‘‘(f) REGULATIONS.—
‘‘(1) IN GENERAL.—The Secretary shall issue interim final
or final regulations to carry out this section and section 1934.
‘‘(2) USE OF PACE PROTOCOL.—
‘‘(A) IN GENERAL.—In issuing such regulations, the Sec-
retary shall, to the extent consistent with the provisions
of this section, incorporate the requirements applied to
H. R. 2015—287
PACE demonstration waiver programs under the PACE
protocol.
‘‘(B) FLEXIBILITY.—In order to provide for reasonable
flexibility in adapting the PACE service delivery model
to the needs of particular organizations (such as those
in rural areas or those that may determine it appropriate
to use nonstaff physicians according to State licensing law
requirements) under this section and section 1934, the
Secretary (in close consultation with State administering
agencies) may modify or waive provisions of the PACE
protocol so long as any such modification or waiver is
not inconsistent with and would not impair the essential
elements, objectives, and requirements of this section, but
may not modify or waive any of the following provisions:
‘‘(i) The focus on frail elderly qualifying individuals
who require the level of care provided in a nursing
facility.
‘‘(ii) The delivery of comprehensive, integrated
acute and long-term care services.
‘‘(iii) The interdisciplinary team approach to care
management and service delivery.
‘‘(iv) Capitated, integrated financing that allows
the provider to pool payments received from public
and private programs and individuals.
‘‘(v) The assumption by the provider of full finan-
cial risk.
‘‘(3) APPLICATION OF CERTAIN ADDITIONAL BENEFICIARY AND
PROGRAM PROTECTIONS.—
‘‘(A) IN GENERAL.—In issuing such regulations and sub-
ject to subparagraph (B), the Secretary may apply with
respect to PACE programs, providers, and agreements such
requirements of part C (or, for periods before January
1, 1999, section 1876) and sections 1903(m) and 1932 relat-
ing to protection of beneficiaries and program integrity
as would apply to Medicare+Choice organizations under
part C (or for such periods eligible organizations under
risk-sharing contracts under section 1876) and to medicaid
managed care organizations under prepaid capitation
agreements under section 1903(m).
‘‘(B) CONSIDERATIONS.—In issuing such regulations, the
Secretary shall—
‘‘(i) take into account the differences between popu-
lations served and benefits provided under this section
and under part C (or, for periods before January 1,
1999, section 1876) and section 1903(m);
‘‘(ii) not include any requirement that conflicts
with carrying out PACE programs under this section;
and
‘‘(iii) not include any requirement restricting the
proportion of enrollees who are eligible for benefits
under this title or title XIX.
‘‘(4) CONSTRUCTION.—Nothing in this subsection shall be
construed as preventing the Secretary from including in regula-
tions provisions to ensure the health and safety of individuals
enrolled in a PACE program under this section that are in
addition to those otherwise provided under paragraphs (2) and
(3).
H. R. 2015—288
‘‘(g) WAIVERS OF REQUIREMENTS.—With respect to carrying out
a PACE program under this section, the following requirements
of this title (and regulations relating to such requirements) are
waived and shall not apply:
‘‘(1) Section 1812, insofar as it limits coverage of institu-
tional services.
‘‘(2) Sections 1813, 1814, 1833, and 1886, insofar as such
sections relate to rules for payment for benefits.
‘‘(3) Sections 1814(a)(2)(B), 1814(a)(2)(C), and 1835(a)(2)(A),
insofar as they limit coverage of extended care services or
home health services.
‘‘(4) Section 1861(i), insofar as it imposes a 3-day prior
hospitalization requirement for coverage of extended care serv-
ices.
‘‘(5) Paragraphs (1) and (9) of section 1862(a), insofar as
they may prevent payment for PACE program services to
individuals enrolled under PACE programs.
‘‘(h) DEMONSTRATION PROJECT FOR FOR-PROFIT ENTITIES.—
‘‘(1) IN GENERAL.—In order to demonstrate the operation
of a PACE program by a private, for-profit entity, the Secretary
(in close consultation with State administering agencies) shall
grant waivers from the requirement under subsection (a)(3)
that a PACE provider may not be a for-profit, private entity.
‘‘(2) SIMILAR TERMS AND CONDITIONS.—
‘‘(A) IN GENERAL.—Except as provided under subpara-
graph (B), and paragraph (1), the terms and conditions
for operation of a PACE program by a provider under
this subsection shall be the same as those for PACE provid-
ers that are nonprofit, private organizations.
‘‘(B) NUMERICAL LIMITATION.—The number of programs
for which waivers are granted under this subsection shall
not exceed 10. Programs with waivers granted under this
subsection shall not be counted against the numerical
limitation specified in subsection (e)(1)(B).
‘‘(i) MISCELLANEOUS PROVISIONS.—Nothing in this section or
section 1934 shall be construed as preventing a PACE provider
from entering into contracts with other governmental or nongovern-
mental payers for the care of PACE program eligible individuals
who are not eligible for benefits under part A, or enrolled under
part B, or eligible for medical assistance under title XIX.’’.
SEC. 4802. ESTABLISHMENT OF PACE PROGRAM AS MEDICAID STATE
OPTION.
(a) IN GENERAL.—Title XIX is amended—
(1) in section 1905(a) (42 U.S.C. 1396d(a)), as amended
by section 4702(a)(1)—
(A) by striking ‘‘and’’ at the end of paragraph (25);
(B) by redesignating paragraph (26) as paragraph (27);
and
(C) by inserting after paragraph (25) the following
new paragraph:
‘‘(26) services furnished under a PACE program under sec-
tion 1934 to PACE program eligible individuals enrolled under
the program under such section; and’’;
(2) by redesignating section 1934, as redesignated by sec-
tion 4732, as section 1935; and
H. R. 2015—289
(3) by inserting after section 1933, as added by such section,
the following new section:
‘‘PROGRAM OF ALL-INCLUSIVE CARE FOR THE ELDERLY (PACE)
‘‘SEC. 1934. (a) STATE OPTION.—
‘‘(1) IN GENERAL.—A State may elect to provide medical
assistance under this section with respect to PACE program
services to PACE program eligible individuals who are eligible
for medical assistance under the State plan and who are
enrolled in a PACE program under a PACE program agreement.
Such individuals need not be eligible for benefits under part
A, or enrolled under part B, of title XVIII to be eligible to
enroll under this section. In the case of an individual enrolled
with a PACE program pursuant to such an election—
‘‘(A) the individual shall receive benefits under the
plan solely through such program, and
‘‘(B) the PACE provider shall receive payment in
accordance with the PACE program agreement for provi-
sion of such benefits.
A State may establish a numerical limit on the number of
individuals who may be enrolled in a PACE program under
a PACE program agreement.
‘‘(2) PACE PROGRAM DEFINED.—For purposes of this section,
the term ‘PACE program’ means a program of all-inclusive
care for the elderly that meets the following requirements:
‘‘(A) OPERATION.—The entity operating the program
is a PACE provider (as defined in paragraph (3)).
‘‘(B) COMPREHENSIVE BENEFITS.—The program provides
comprehensive health care services to PACE program
eligible individuals in accordance with the PACE program
agreement and regulations under this section.
‘‘(C) TRANSITION.—In the case of an individual who
is enrolled under the program under this section and whose
enrollment ceases for any reason (including that the
individual no longer qualifies as a PACE program eligible
individual, the termination of a PACE program agreement,
or otherwise), the program provides assistance to the
individual in obtaining necessary transitional care through
appropriate referrals and making the individual’s medical
records available to new providers.
‘‘(3) PACE PROVIDER DEFINED.—
‘‘(A) IN GENERAL.—For purposes of this section, the
term ‘PACE provider’ means an entity that—
‘‘(i) subject to subparagraph (B), is (or is a distinct
part of) a public entity or a private, nonprofit entity
organized for charitable purposes under section
501(c)(3) of the Internal Revenue Code of 1986, and
‘‘(ii) has entered into a PACE program agreement
with respect to its operation of a PACE program.
‘‘(B) TREATMENT OF PRIVATE, FOR-PROFIT PROVIDERS.—
Clause (i) of subparagraph (A) shall not apply—
‘‘(i) to entities subject to a demonstration project
waiver under subsection (h); and
‘‘(ii) after the date the report under section 4804(b)
of the Balanced Budget Act of 1997 is submitted, unless
the Secretary determines that any of the findings