‘‘(A) IN GENERAL.—Each PCN that ap-
plies for participation in the demonstration 
project and is approved for such participation 
by the Secretary shall enter into an agreement 
with the Secretary to participate in the dem-
onstration project for at least 3 years. Under 
such agreement, the Secretary may require a 
PCN to demonstrate, through financial instru-
ments including surety bonds, lines of credit, or 
other means, sufficient financial resources in 
order to meet reasonably anticipated obligations 
that would arise as a result of participation in 
the demonstration project. 
‘‘(B) RENEWAL.—An agreement under 
subparagraph (A) may be renewed or extended 
by mutual agreement of the PCN and the Sec-
retary for up to a total of 5 years. 
‘‘(C) TERMINATION.—The Secretary may 
terminate an agreement under this paragraph 
with a PCN before the end of the term of the 
agreement if the PCN fails to meet minimum 
quality standards established by the Secretary 
pursuant to subsection (f) or for any other rea-
son specified by the Secretary. 
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‘‘(4) TREATMENT
OF
ENTITIES
IN
EXISTING 
AGREEMENTS.—An organization of providers of 
services and suppliers that would otherwise be a 
PCN eligible to participate in the demonstration 
project, but that has entered into another agreement 
with the Secretary that involves shared savings 
under this title and includes downside risk may elect 
to apply under paragraph (3) to transition from 
such other agreement into an agreement with the 
Secretary under paragraph (3) to participate in the 
demonstration project under this section. Any such 
organization that transitions under this paragraph 
to the demonstration project under this section shall 
do so in a manner that is consistent with any transi-
tion provisions as the Secretary may specify. 
‘‘(5) COST-SHARING.— 
‘‘(A) IN GENERAL.—Under the demonstra-
tion project, cost-sharing that would otherwise 
apply with respect to an item or service under 
this title shall apply with respect to such item 
or service furnished through a PCN, except to 
the extent such PCN may modify such cost- 
sharing pursuant to a waiver under subsection 
(h) and subparagraph (B). 
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‘‘(B) SECRETARIAL APPROVAL.—The Sec-
retary shall establish a process under which a 
PCN participating under the demonstration 
program may apply to the Secretary for a waiv-
er under subsection (h) in order to modify cost- 
sharing for items and services furnished 
through such PCN under the demonstration 
program. 
‘‘(c) BENEFICIARY ASSIGNMENT.— 
‘‘(1) ASSIGNMENT TO PCN.— 
‘‘(A) IN
GENERAL.—Upon entering in a 
contract with a PCN under subsection (b)(3), 
the Secretary shall establish a process to, with 
respect to each year during the demonstration 
project, prospectively assign Medicare fee-for- 
service beneficiaries to such PCN for such year. 
Such assignment shall be based on utilization of 
primary care services furnished under this title 
by a provider of services or supplier partici-
pating in the PCN involved. 
‘‘(B) SELECTION.—The Secretary shall 
allow PCNs to establish a pilot program under 
which such PCNs have a process through which 
Medicare fee-for-service beneficiaries may select 
a PCN. Such selection by the beneficiary shall 
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be treated for purposes of this section as the 
assignment of the beneficiary to the PCN and 
shall supercede any other assignment by the 
Secretary under subparagraph (A) with respect 
to such beneficiary. 
‘‘(C) OPT OUT.—The process under para-
graph (1) shall allow for Medicare fee-for-serv-
ice beneficiaries to opt out of this section. 
‘‘(2) PRIMARY CARE PHYSICIAN ASSIGNMENT.— 
Upon assignment under paragraph (1) of a Medicare 
fee-for-service beneficiary to a PCN, the Secretary 
shall allow the PCN to contact the beneficiary to 
designate a primary care physician participating in 
the PCN who shall be accountable for the coordina-
tion of the medical care of the beneficiary. The Sec-
retary shall also allow the PCN to communicate with 
other individuals entitled to benefits under part A or 
enrolled under part B in the region served by the 
PCN regarding the opportunity to participate in th 
PCN. The Secretary shall promulgate regulations to 
govern the assignment of an individual to a primary 
care physician participating in the PCN in the ab-
sence of such designation by the individual in a 
manner that promotes patient engagement and sta-
bility in assignment and that takes into account pri-
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mary care visits by physicians, nurse practitioners, 
and physician assistants. 
‘‘(3) PAYMENTS
WITH
RESPECT
TO
POPU-
LATION.—Except in circumstances specified by the 
Secretary, during the period for which a Medicare 
fee-for-service beneficiary is a participating bene-
ficiary with respect to a PCN under this section, 
payment may not be made under part A or B with 
respect to such beneficiary other than under this 
section. 
‘‘(4) 
SERVICES
FROM
OUT-OF-PCN
PRO-
VIDERS.— 
‘‘(A) IN GENERAL.—In the case of an item 
or service covered under the demonstration 
project which is furnished to a participating 
beneficiary, with respect to a PCN, during the 
period in which the beneficiary is participating 
in such PCN under the demonstration project 
from a provider of services or supplier not par-
ticipating in or otherwise entering into an 
agreement with the PCN with respect to such 
item or service (in this paragraph referred to as 
an ‘out-of-network provider’, with respect to 
such PCN), in addition to any cost-sharing re-
sponsibility specified by the PCN, the bene-
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ficiary shall be responsible for any amount by 
which— 
‘‘(i) the amount payable under part A 
or B for such item or service; exceeds 
‘‘(ii) the payment amount that would 
be paid by the PCN for such item or serv-
ice if such item or service were furnished 
by a provider of services or supplier who is 
participating in, or otherwise has an agree-
ment with, the PCN with respect to such 
item or service. 
‘‘(B) REIMBURSEMENT BY PCN.— 
‘‘(i) IN GENERAL.—In applying this 
paragraph, the Secretary shall ensure that 
an out-of-network provider, with respect to 
a PCN that furnishes an item or service to 
a participating beneficiary, with respect to 
such PCN, is reimbursed by the PCN in 
such a manner that avoids fraud and du-
plication of payment. For purposes of the 
previous sentence, the Secretary shall es-
tablish a process by which such a provider 
may establish a contractual relationship 
with a PCN for reimbursement, subject to 
clause (ii), for items and services furnished 
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