(B) approve eligible Medicare Advantage 
plans to participate in such demonstration pro-
gram. 
In selecting Medicare Advantage sites under subpara-
graph (A), the Secretary shall take into account area 
differences as well as the availability of health main-
tenance organization plans and preferred provider or-
ganization plans offered in such sites. 
(2) START
OF
DEMONSTRATION.—The dem-
onstration program shall begin not later than the 
third plan year beginning after the date of the enact-
ment of this Act. 
(3) ELIGIBLE MEDICARE ADVANTAGE PLANS.— 
For purposes of this section, the term ‘‘eligible Medi-
care Advantage plan’’ means a Medicare Advantage 
plan under part C of title XVIII of the Social Secu-
rity Act (42 U.S.C. 1395w–21 et seq.) that meets the 
following requirements: 
(A) The plan is an Medicare Advantage re-
gional plan (as defined in paragraph (4) of sec-
tion 1859(b) of such Act (42 U.S.C. 1395w– 
28(b))) or Medicare Advantage local plan (as de-
fined in paragraph (5) of such section) offered in 
the Medicare Advantage region selected under 
paragraph (1)(A). 
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(B) The plan has— 
(i)(I) a quality rating under section 
1853(o) of such Act (42 U.S.C. 1395w– 
23(o)) of 4 stars or higher based on the most 
recent data available for such year, or (II) 
in the case of a specialized Medicare Advan-
tage plan for special needs individuals, as 
defined in section 1859(b)(6)(A) of such Act 
(42 U.S.C. 1395w–28(b)(6)(A)), a quality 
rating under section 1853(o) of such Act (42 
U.S.C. 1395w–23(o)) equal to or higher 
than the national average for special needs 
plans (excluding Institutional-Special needs 
plans) based on the most recent data avail-
able for such year; and 
(ii) at least 20 percent of the popu-
lation to whom the plan is offered in a serv-
ice area consists of subsidy eligible individ-
uals 
(as 
defined 
in 
section 
1860D– 
14(a)(3)(A) of the Social Security Act (42 
U.S.C. 1395w–114(a)(3)(A))). 
(4) DISCLOSURE TO BENEFICIARIES.—The Sec-
retary shall provide to each individual eligible to en-
roll under a Medicare Advantage plan approved to 
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participate under the demonstration program during 
a plan year for which the plan is so selected— 
(A) notification that the plan is partici-
pating in such demonstration program; 
(B) background information on the dem-
onstration program; 
(C) clinical data derived from the studies 
resulting from the demonstration program; and 
(D) notification of the potential benefits 
that the individual will receive, and of the other 
potential impacts that the individual will expe-
rience, on account of the participation of the 
plan in the demonstration program. 
(c) VALUE-BASED INSURANCE DESIGN METHODOLO-
GIES.— 
(1) DEFINITION.—For purposes of this section, 
the term ‘‘value-based insurance design methodology’’ 
means a methodology for identifying specific prescrip-
tion medications, and clinical services that are pay-
able under title XVIII of the Social Security Act, for 
which the reduction of copayments, coinsurance, or 
both, would improve the management of specific 
chronic clinical conditions because of the high value 
and effectiveness of such medications and services for 
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such specific chronic clinical conditions, as approved 
by the Secretary. 
(2) USE OF METHODOLOGIES TO REDUCE COPAY-
MENTS AND COINSURANCE.—A Medicare Advantage 
organization offering an eligible Medicare Advantage 
plan approved to participate under the demonstration 
program, for each plan year for which the plan is so 
selected and using value-based insurance design meth-
odologies— 
(A) shall identify each prescription medica-
tion and clinical service covered under such plan 
for which the plan proposes to reduce or elimi-
nate the copayment or coinsurance, with respect 
to the management of specific chronic clinical 
conditions (as specified by the Secretary) of 
Medicare Advantage eligible individuals (as de-
fined in section 1851(a)(3) of the Social Security 
Act (42 U.S.C. 1395w–21(a)(3))) enrolled under 
such plans, for such plan year; 
(B) may, for such plan year, reduce or 
eliminate copayments, coinsurance, or both for 
such prescription medication and clinical serv-
ices so identified with respect to the management 
of such conditions of such individuals— 
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(i) if such reduction or elimination is 
evidence-based and for the purpose of en-
couraging such individuals in such plan to 
use such prescription medications and clin-
ical services (such as preventive care, pri-
mary care, specialty visits, diagnostic tests, 
procedures, and durable medical equipment) 
with respect to such conditions; and 
(ii) for the purpose of encouraging 
such individuals in such plan to use health 
care providers that such organization has 
identified with respect to such plan year as 
being high value providers; and 
(C) if a reduction or elimination is applied 
pursuant to subparagraph (B), with respect to 
such medication and clinical services, shall, for 
such plan year, count toward the deductible ap-
plicable to such individual under such plan 
amounts that would have been payable by the in-
dividual as copayment or coinsurance for such 
medication and services if the reduction or elimi-
nation had not been applied. 
(3) PROHIBITION OF INCREASES OF COPAYMENTS 
AND COINSURANCE.—In no case may any Medicare 
Advantage plan participating in the demonstration 
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program increase, for any plan year for which the 
plan is so participating, the amount of copayments or 
coinsurance for any item or service covered under 
such plan for purposes of discouraging the use of such 
item or service. 
(d) REPORT ON IMPLEMENTATION.— 
(1) IN GENERAL.—Not later than 1 year after 
the date on which the demonstration program under 
this section begins under subsection (b)(2), the Sec-
retary shall submit to Congress a report on the status 
of the implementation of the demonstration program. 
(2) ELEMENTS.—The report required by para-
graph (1) shall, with respect to eligible Medicare Ad-
vantage plans participating in the demonstration 
program for the first plan year of such program, in-
clude the following: 
(A) A list of each medication and service 
identified pursuant to subsection (c)(2)(A) for 
such plan with respect to such plan year. 
(B) For each such medication or service so 
identified, the amount of the copayment or coin-
surance required under such plan with respect to 
such plan year for such medication or service 
and the amount of the reduction of such copay-
ment or coinsurance from a previous plan year. 
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(C) For each provider identified pursuant 
to subsection (c)(2)(B)(ii) for such plan with re-
spect to such plan year, a statement of the 
amount of the copayment or coinsurance re-
quired under such plan with respect to such plan 
year and the amount of the reduction of such co-
payment or coinsurance from the previous plan 
year. 
(e) REVIEW AND ASSESSMENT OF UTILIZATION OF 
VALUE-BASED INSURANCE DESIGN METHODOLOGIES.— 
(1) IN GENERAL.—The Secretary shall enter into 
a contract or agreement with an independent entity 
to review and assess the implementation of the dem-
onstration program under this section. The review 
and assessment shall include the following: 
(A) An assessment of the utilization of 
value-based insurance design methodologies by 
Medicare Advantage plans participating under 
such program. 
(B) An analysis of whether reducing or 
eliminating the copayment or coinsurance for 
each medication and clinical service identified 
pursuant to subsection (c)(2)(A) resulted in in-
creased adherence to medication regimens, in-
creased service utilization, improvement in qual-
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ity metrics, better health outcomes, and enhanced 
beneficiary experience. 
(C) An analysis of the extent to which costs 
to Medicare Advantage plans under part C of 
title XVIII of the Social Security Act partici-
pating in the demonstration program is less 
than costs to Medicare Advantage plans under 
such part that are not participating in the dem-
onstration program. 
(D) An analysis of whether reducing or 
eliminating the copayment or coinsurance for 
providers identified pursuant to subsection 
(c)(2)(B)(ii) resulted in improvement in quality 
metrics, better health outcomes, and enhanced 
beneficiary experience. 
(E) An analysis, for each provider so iden-
tified, the extent to which costs to Medicare Ad-
vantage plans under part C of title XVIII of the 
Social Security Act participating in the dem-
onstration program is less than costs to Medicare 
Advantage plans under such part that are not 
participating in the demonstration program. 
(F) Such other matters as the Secretary 
considers appropriate. 
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(2) REPORT.—The contract or agreement entered 
into under paragraph (1) shall require such entity to 
submit to the Secretary a report on the review and 
assessment conducted by the entity under such para-
graph in time for the inclusion of the results of such 
report in the report required by paragraph (3). Such 
report shall include a description, in clear language, 
of the manner in which the entity conducted the re-
view and assessment. 
(3) REPORT TO CONGRESS.—Not later than 4 
years after the date on which the demonstration pro-
gram begins under subsection (b)(2), the Secretary 
shall submit to Congress a report on the review and 
assessment of the demonstration program conducted 
under this subsection. The report shall include the fol-
lowing: 
(A) A description of the results of the review 
and assessment included in the report submitted 
pursuant to paragraph (2). 
(B) Such recommendations as the Secretary 
considers appropriate for enhancing the utiliza-
tion of the methodologies applied under the dem-
onstration program to all Medicare Advantage 
plans under part C of title XVIII of the Social 
Security Act so as to reduce copayments and co-
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insurance under such plans paid by Medicare 
beneficiaries for high-value prescription medica-
tions and clinical services for which coverage is 
provided under such plans and to otherwise im-
prove the quality of health care provided under 
such plans. 
(4) OVERSIGHT REPORT.—Not later than three 
years after the date of the enactment of this Act, the 
Comptroller General of the United States shall submit 
to Congress a report on the demonstration program 
that includes an assessment, with respect to individ-
uals enrolled under Medicare Advantage plans ap-
proved to participate under the demonstration pro-
gram, of the impact that the age, co-morbidities, and 
geographic regions of such individuals had upon the 
implementation of the demonstration program by the 
plans with respect to such individuals. 
(f) SAVINGS.—In no case may any reduction in bene-
ficiary copayments or coinsurance resulting from the imple-
mentation of the demonstration program under this section 
result in expenditures under parts A, B, and D of the title 
XVIII of the Social Security Act that are greater than such 
expenditures without application of this section. 
(g) EXPANSION OF DEMONSTRATION PROGRAM.—Tak-
ing into account the review and assessment conducted under 
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subsection (e), the Secretary may, through notice and com-
ment rulemaking, expand (including implementation on a 
nationwide basis) the duration and scope of the demonstra-
tion program under title XVIII of the Social Security Act, 
other than under the original medicare fee-for-service pro-
gram under parts A and B of such title, to the extent deter-
mined appropriate by the Secretary, if the requirements of 
paragraphs (1), (2) and (3) of subsection (c) of section 
1115A of the Social Security Act (42 U.S.C. 1315a), as ap-
plied to the testing of a model under subsection (b) of such 
section, applied to the demonstration under this section. 
(h) WAIVER AUTHORITY.—The Secretary may waive 
such provisions of titles XI and XVIII of the Social Security 
Act as may be necessary to carry out the demonstration 
program under this section. 
(i) IMPLEMENTATION FUNDING.—For purposes of car-
rying out the demonstration program under this section, 
the Secretary shall provide for the transfer from the Federal 
Hospital Insurance Trust Fund under section 1817 of the 
Social Security Act (42 U.S.C. 1395i) and the Federal Sup-
plementary Insurance Trust Fund under section 1841 of 
the Social Security Act (42 U.S.C. 1395t), including the 
Medicare Prescription Drug Account in such Trust Fund, 
in such proportion as determined appropriate by the Sec-
retary, of such sums as may be necessary. 
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SEC. 
3. 
PRESERVATION 
OF 
MEDICARE 
BENEFICIARY 
CHOICE UNDER MEDICARE ADVANTAGE. 
Section 1851(e)(2) of the Social Security Act (42 
U.S.C. 1395w–21(e)(2)) is amended— 
(1) in subparagraph (C)— 
(A) in the heading, by inserting ‘‘FROM 2011 
THROUGH 2015’’ after ‘‘45-DAY PERIOD’’; and 
(B) by inserting ‘‘and ending with 2015’’ 
after ‘‘beginning with 2011’’; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(G) CONTINUOUS OPEN ENROLLMENT AND 
DISENROLLMENT FOR FIRST 3 MONTHS IN 2016 
AND SUBSEQUENT YEARS.— 
‘‘(i) IN
GENERAL.—Subject to clause 
(ii) and subparagraph (D)— 
‘‘(I) in the case of an MA eligible 
individual who is enrolled in an MA 
plan, at any time during the first 3 
months of a year (beginning with 
2016); or 
‘‘(II) in the case of an individual 
who first becomes an MA eligible indi-
vidual during a year (beginning with 
2016) and enrolls in an MA plan, dur-
ing the first 3 months during such 
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year in which the individual is an MA 
eligible individual; 
such MA eligible individual may change the 
election under subsection (a)(1). 
‘‘(ii) LIMITATION
OF
ONE
CHANGE 
DURING OPEN ENROLLMENT PERIOD EACH 
YEAR.—An individual may change the elec-
tion pursuant to clause (i) only once during 
the applicable 3-month period described in 
such clause in each year. The limitation 
under this clause shall not apply to changes 
in elections effected during an annual, co-
ordinated election period under paragraph 
(3) or during a special enrollment period 
under paragraph (4). 
‘‘(iii) LIMITED APPLICATION TO PART 
D.—Clauses (i) and (ii) of this subpara-
graph shall only apply with respect to 
changes in enrollment in a prescription 
drug plan under part D in the case of an 
individual who, previous to such change in 
enrollment, is enrolled in a Medicare Ad-
vantage plan. 
‘‘(iv) LIMITATIONS ON MARKETING.— 
Pursuant to subsection (j), no unsolicited 
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marketing or marketing materials may be 
sent to an individual described in clause (i) 
during the continuous open enrollment and 
disenrollment period established for the in-
dividual under such clause, notwithstanding 
marketing guidelines established by the Cen-
ters for Medicare & Medicaid Services.’’. 
SEC. 4. TREATMENT OF INFUSION DRUGS FURNISHED 
THROUGH DURABLE MEDICAL EQUIPMENT. 
Section 1842(o)(1) of the Social Security Act (42 
U.S.C. 1395u(o)(1)) is amended— 
(1) in subparagraph (C), by inserting ‘‘(and in-
cluding a drug or biological described in subpara-
graph (D)(i) furnished on or after January 1, 2017)’’ 
after ‘‘2005’’; and 
(2) in subparagraph (D)— 
(A) by striking ‘‘infusion drugs’’ and insert-
ing ‘‘infusion drugs or biologicals’’ each place it 
appears; and 
(B) in clause (i)— 
(i) by striking ‘‘2004’’ and inserting 
‘‘2004, and before January 1, 2017’’; and 
(ii) by striking ‘‘for such drug’’. 
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SEC. 5. SENSE OF CONGRESS REGARDING THE IMPLEMEN-
TATION AND DISTRIBUTION OF QUALITY IN-
CENTIVE PAYMENTS TO MEDICARE ADVAN-
TAGE PLANS. 
It is the sense of Congress that— 
(1) the Secretary of Health and Human Services 
has incorrectly interpreted subsection (n) of section 
1853 of the Social Security Act (42 U.S.C. 1395w– 
23) as prohibiting the provision of any Medicare 
quality incentive payments under subsection (o) of 
such section with respect to Medicare Advantage 
plans that exceed the payment benchmark cap under 
such subsection (n) for the area served by such plans; 
and 
(2) the Secretary should immediately apply 
quality incentive payments under such subsection (o) 
with respect to such Medicare Advantage plans with-
out regard to the limits set forth in such subsection 
(n). 
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Union Calendar No. 117 
114TH CONGRESS 
1ST SESSION 
H. R. 2581 
[Report No. 114–161, Part I] 
A BILL 
To amend title XVIII of the Social Security Act to 
establish a 3-year demonstration program to test 
the use of value-based insurance design meth-
odologies under eligible Medicare Advantage 
plans, to preserve Medicare beneficiary choice 
under Medicare Advantage, to revise the treat-
ment under the Medicare program of infusion 
drugs furnished through durable medical equip-
ment, and for other purposes. 
JUNE 16, 2015 
Reported from the Committee on Ways and Means with 
an amendment 
JUNE 16, 2015 
The Committee on Energy and Commerce discharged; 
committed to the Committee of the Whole House on 
the State of the Union and ordered to be printed 
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