H. R. 3590—336 
‘‘(4) Section 1853(o), relating to grandfathering supple-
mental benefits for current enrollees after implementation of 
competitive bidding. 
‘‘(5) Section 1853(p), relating to transitional extra benefits.’’. 
(2) SPECIAL RULE FOR MA PAYMENT AREA FOR PACE PRO-
GRAMS.—Section 1853(d) of the Social Security Act (42 U.S.C. 
1395w–23(d)), as amended by subsection (e), is amended by 
adding at the end the following new paragraph: 
‘‘(6) SPECIAL RULE FOR MA PAYMENT AREA FOR PACE PRO-
GRAMS.—For years beginning with 2012, in the case of a PACE 
program under section 1894, the MA payment area shall be 
the MA local area (as defined in paragraph (2)).’’. 
SEC. 3202. BENEFIT PROTECTION AND SIMPLIFICATION. 
(a) LIMITATION ON VARIATION OF COST SHARING FOR CERTAIN 
BENEFITS.— 
(1) IN GENERAL.—Section 1852(a)(1)(B) of the Social Secu-
rity Act (42 U.S.C. 1395w–22(a)(1)(B)) is amended— 
(A) in clause (i), by inserting ‘‘, subject to clause (iii),’’ 
after ‘‘and B or’’; and 
(B) by adding at the end the following new clauses: 
‘‘(iii) LIMITATION ON VARIATION OF COST SHARING 
FOR
CERTAIN
BENEFITS.—Subject to clause (v), cost- 
sharing for services described in clause (iv) shall not 
exceed the cost-sharing required for those services 
under parts A and B. 
‘‘(iv) SERVICES DESCRIBED.—The following services 
are described in this clause: 
‘‘(I) Chemotherapy administration services. 
‘‘(II) Renal dialysis services (as defined in sec-
tion 1881(b)(14)(B)). 
‘‘(III) Skilled nursing care. 
‘‘(IV) Such other services that the Secretary 
determines appropriate (including services that the 
Secretary determines require a high level of 
predictability and transparency for beneficiaries). 
‘‘(v) EXCEPTION.—In the case of services described 
in clause (iv) for which there is no cost-sharing required 
under parts A and B, cost-sharing may be required 
for those services in accordance with clause (i).’’. 
(2) EFFECTIVE DATE.—The amendments made by this sub-
section shall apply to plan years beginning on or after January 
1, 2011. 
(b) APPLICATION
OF REBATES, PERFORMANCE BONUSES, AND 
PREMIUMS.— 
(1) APPLICATION OF REBATES.—Section 1854(b)(1)(C) of the 
Social Security Act (42 U.S.C. 1395w–24(b)(1)(C)) is amended— 
(A) in clause (ii), by striking ‘‘REBATE.—A rebate’’ and 
inserting ‘‘REBATE FOR PLAN YEARS BEFORE 2012.—For plan 
years before 2012, a rebate’’; 
(B) by redesignating clauses (iii) and (iv) as clauses 
(iv) and (v); and 
(C) by inserting after clause (ii) the following new 
clause: 
‘‘(iii) FORM OF REBATE FOR PLAN YEAR 2012 AND 
SUBSEQUENT PLAN YEARS.—For plan years beginning 
on or after January 1, 2012, a rebate required under
H. R. 3590—337 
this subparagraph may not be used for the purpose 
described in clause (ii)(III) and shall be provided 
through the application of the amount of the rebate 
in the following priority order: 
‘‘(I) First, to use the most significant share 
to meaningfully reduce cost-sharing otherwise 
applicable for benefits under the original medicare 
fee-for-service program under parts A and B and 
for qualified prescription drug coverage under part 
D, including the reduction of any deductibles, co-
payments, and maximum limitations on out-of- 
pocket expenses otherwise applicable. Any reduc-
tion of maximum limitations on out-of-pocket 
expenses under the preceding sentence shall apply 
to all benefits under the original medicare fee- 
for-service program option. The Secretary may pro-
vide guidance on meaningfully reducing cost- 
sharing under this subclause, except that such 
guidance may not require a particular amount of 
cost-sharing or reduction in cost-sharing. 
‘‘(II) Second, to use the next most significant 
share to meaningfully provide coverage of preven-
tive and wellness health care benefits (as defined 
by the Secretary) which are not benefits under 
the original medicare fee-for-service program, such 
as smoking cessation, a free flu shot, and an 
annual physical examination. 
‘‘(III) Third, to use the remaining share to 
meaningfully provide coverage of other health care 
benefits which are not benefits under the original 
medicare fee-for-service program, such as eye 
examinations and dental coverage, and are not 
benefits described in subclause (II).’’. 
(2) APPLICATION
OF
PERFORMANCE
BONUSES.—Section 
1853(n) of the Social Security Act, as added by section 3201(f), 
is amended by adding at the end the following new paragraph: 
‘‘(6) APPLICATION
OF
PERFORMANCE
BONUSES.—For plan 
years beginning on or after January 1, 2014, any performance 
bonus paid to an MA plan under this subsection shall be 
used for the purposes, and in the priority order, described 
in subclauses (I) through (III) of section 1854(b)(1)(C)(iii).’’. 
(3) APPLICATION OF MA MONTHLY SUPPLEMENTARY BENE-
FICIARY PREMIUM.—Section 1854(b)(2)(C) of the Social Security 
Act (42 U.S.C. 1395w–24(b)(2)(C)) is amended— 
(A) by striking ‘‘PREMIUM.—The term’’ and inserting 
‘‘PREMIUM.— 
‘‘(i) IN GENERAL.—The term’’; and 
(B) by adding at the end the following new clause: 
‘‘(ii) APPLICATION OF MA MONTHLY SUPPLEMENTARY 
BENEFICIARY PREMIUM.—For plan years beginning on 
or after January 1, 2012, any MA monthly supple-
mentary beneficiary premium charged to an individual 
enrolled in an MA plan shall be used for the purposes, 
and in the priority order, described in subclauses (I) 
through (III) of paragraph (1)(C)(iii).’’.
H. R. 3590—338 
SEC. 3203. APPLICATION OF CODING INTENSITY ADJUSTMENT DURING 
MA PAYMENT TRANSITION. 
Section 1853(a)(1)(C) of the Social Security Act (42 U.S.C. 
1395w–23(a)(1)(C)) is amended by adding at the end the following 
new clause: 
‘‘(iii) APPLICATION OF CODING INTENSITY ADJUST-
MENT FOR 2011 AND SUBSEQUENT YEARS.— 
‘‘(I) REQUIREMENT TO APPLY IN 2011 THROUGH 
2013.—In order to ensure payment accuracy, the 
Secretary shall conduct an analysis of the dif-
ferences described in clause (ii)(I). The Secretary 
shall ensure that the results of such analysis are 
incorporated into the risk scores for 2011, 2012, 
and 2013. 
‘‘(II) AUTHORITY TO APPLY IN 2014 AND SUBSE-
QUENT YEARS.—The Secretary may, as appropriate, 
incorporate the results of such analysis into the 
risk scores for 2014 and subsequent years.’’. 
SEC. 3204. SIMPLIFICATION OF ANNUAL BENEFICIARY ELECTION 
PERIODS. 
(a) ANNUAL 45-DAY PERIOD
FOR DISENROLLMENT FROM MA 
PLANS TO ELECT TO RECEIVE BENEFITS UNDER THE ORIGINAL MEDI-
CARE FEE-FOR-SERVICE PROGRAM.— 
(1) IN GENERAL.—Section 1851(e)(2)(C) of the Social Secu-
rity Act (42 U.S.C. 1395w–1(e)(2)(C)) is amended to read as 
follows: 
‘‘(C) ANNUAL 45-DAY PERIOD FOR DISENROLLMENT FROM 
MA
PLANS
TO
ELECT
TO
RECEIVE
BENEFITS
UNDER
THE 
ORIGINAL MEDICARE FEE-FOR-SERVICE PROGRAM.—Subject to 
subparagraph (D), at any time during the first 45 days 
of a year (beginning with 2011), an individual who is 
enrolled in a Medicare Advantage plan may change the 
election under subsection (a)(1), but only with respect to 
coverage under the original medicare fee-for-service pro-
gram under parts A and B, and may elect qualified 
prescription drug coverage in accordance with section 
1860D–1.’’. 
(2) EFFECTIVE DATE.—The amendment made by paragraph 
(1) shall apply with respect to 2011 and succeeding years. 
(b) TIMING OF THE ANNUAL, COORDINATED ELECTION PERIOD 
UNDER PARTS C AND D.—Section 1851(e)(3)(B) of the Social Security 
Act (42 U.S.C. 1395w–1(e)(3)(B)) is amended— 
(1) in clause (iii), by striking ‘‘and’’ at the end; 
(2) in clause (iv)— 
(A) by striking ‘‘and succeeding years’’ and inserting 
‘‘, 2008, 2009, and 2010’’; and 
(B) by striking the period at the end and inserting 
‘‘; and’’; and 
(3) by adding at the end the following new clause: 
‘‘(v) with respect to 2012 and succeeding years, 
the period beginning on October 15 and ending on 
December 7 of the year before such year.’’.
H. R. 3590—339 
SEC. 3205. EXTENSION FOR SPECIALIZED MA PLANS FOR SPECIAL 
NEEDS INDIVIDUALS. 
(a) EXTENSION OF SNP AUTHORITY.—Section 1859(f)(1) of the 
Social Security Act (42 U.S.C. 1395w–28(f)(1)), as amended by sec-
tion 164(a) of the Medicare Improvements for Patients and Pro-
viders Act of 2008 (Public Law 110–275), is amended by striking 
‘‘2011’’ and inserting ‘‘2014’’. 
(b) AUTHORITY TO APPLY FRAILTY ADJUSTMENT UNDER PACE 
PAYMENT RULES.—Section 1853(a)(1)(B) of the Social Security Act 
(42 U.S.C. 1395w–23(a)(1)(B)) is amended by adding at the end 
the following new clause: 
‘‘(iv) AUTHORITY
TO
APPLY
FRAILTY
ADJUSTMENT 
UNDER PACE PAYMENT RULES FOR CERTAIN SPECIALIZED 
MA PLANS FOR SPECIAL NEEDS INDIVIDUALS.— 
‘‘(I) IN
GENERAL.—Notwithstanding the pre-
ceding provisions of this paragraph, for plan year 
2011 and subsequent plan years, in the case of 
a plan described in subclause (II), the Secretary 
may apply the payment rules under section 1894(d) 
(other than paragraph (3) of such section) rather 
than the payment rules that would otherwise apply 
under this part, but only to the extent necessary 
to reflect the costs of treating high concentrations 
of frail individuals. 
‘‘(II) PLAN
DESCRIBED.—A plan described in 
this subclause is a specialized MA plan for special 
needs 
individuals 
described 
in 
section 
1859(b)(6)(B)(ii) that is fully integrated with 
capitated contracts with States for Medicaid bene-
fits, including long-term care, and that have 
similar average levels of frailty (as determined 
by the Secretary) as the PACE program.’’. 
(c) TRANSITION
AND EXCEPTION REGARDING RESTRICTION
ON 
ENROLLMENT.—Section 1859(f) of the Social Security Act (42 U.S.C. 
1395w–28(f)) is amended by adding at the end the following new 
paragraph: 
‘‘(6) TRANSITION AND EXCEPTION REGARDING RESTRICTION 
ON ENROLLMENT.— 
‘‘(A) IN GENERAL.—Subject to subparagraph (C), the 
Secretary shall establish procedures for the transition of 
applicable individuals to— 
‘‘(i) a Medicare Advantage plan that is not a 
specialized MA plan for special needs individuals (as 
defined in subsection (b)(6)); or 
‘‘(ii) the original medicare fee-for-service program 
under parts A and B. 
‘‘(B) APPLICABLE INDIVIDUALS.—For purposes of clause 
(i), the term ‘applicable individual’ means an individual 
who— 
‘‘(i) is enrolled under a specialized MA plan for 
special needs individuals (as defined in subsection 
(b)(6)); and 
‘‘(ii) is not within the 1 or more of the classes 
of special needs individuals to which enrollment under 
the plan is restricted to. 
‘‘(C) EXCEPTION.—The Secretary shall provide for an 
exception to the transition described in subparagraph (A)