
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document affected by Public Law 106-554 Section 1(a)(6)]
[Document affected by Public Law 106-554 Section 1(a)(6)[622(a)]]
[Document affected by Public Law 106-554 Section 1(a)(6)[622(b)]]
[CITE: 42USC1395w-24]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                       CHAPTER 7--SOCIAL SECURITY
 
        SUBCHAPTER XVIII--HEALTH INSURANCE FOR AGED AND DISABLED
 
                     Part C--Medicare+Choice Program
 
Sec. 1395w-24. Premiums


(a) Submission of proposed premiums and related information

                           (1) In general

        Not later than July 1 of each year, each Medicare+Choice 
    organization shall submit to the Secretary, in a form and manner 
    specified by the Secretary and for each Medicare+
    Choice plan for the service area (or segment of such an area if 
    permitted under subsection (h) of this section) in which it intends 
    to be offered in the following year--
            (A) the information described in paragraph (2), (3), or (4) 
        for the type of plan involved; and
            (B) the enrollment capacity (if any) in relation to the plan 
        and area.

         (2) Information required for coordinated care plans

        For a Medicare+Choice plan described in section 1395w-
    21(a)(2)(A) of this title, the information described in this 
    paragraph is as follows:

        (A) Basic (and additional) benefits

            For benefits described in section 1395w-22(a)(1)(A) of this 
        title--
                (i) the adjusted community rate (as defined in 
            subsection (f)(3) of this section);
                (ii) the Medicare+Choice monthly basic beneficiary 
            premium (as defined in subsection (b)(2)(A) of this 
            section);
                (iii) a description of deductibles, coinsurance, and 
            copayments applicable under the plan and the actuarial value 
            of such deductibles, coinsurance, and copayments, described 
            in subsection (e)(1)(A) of this section; and
                (iv) if required under subsection (f)(1) of this 
            section, a description of the additional benefits to be 
            provided pursuant to such subsection and the value 
            determined for such proposed benefits under such subsection.

        (B) Supplemental benefits

            For benefits described in section 1395w-22(a)(3) of this 
        title--
                (i) the adjusted community rate (as defined in 
            subsection (f)(3) of this section);
                (ii) the Medicare+Choice monthly supplemental 
            beneficiary premium (as defined in subsection (b)(2)(B) of 
            this section); and
                (iii) a description of deductibles, coinsurance, and 
            copayments applicable under the plan and the actuarial value 
            of such deductibles, coinsurance, and copayments, described 
            in subsection (e)(2) of this section.

                   (3) Requirements for MSA plans

        For an MSA plan described, the information described in this 
    paragraph is as follows:

        (A) Basic (and additional) benefits

            For benefits described in section 1395w-22(a)(1)(A) of this 
        title, the amount of the Medicare+
        Choice monthly MSA premium.

        (B) Supplemental benefits

            For benefits described in section 1395w-22(a)(3) of this 
        title, the amount of the Medicare+
        Choice monthly supplementary beneficiary premium.

         (4) Requirements for private fee-for-service plans

        For a Medicare+Choice plan described in section 1395w-
    21(a)(2)(C) of this title for benefits described in section 1395w-
    22(a)(1)(A) of this title, the information described in this 
    paragraph is as follows:

        (A) Basic (and additional) benefits

            For benefits described in section 1395w-22(a)(1)(A) of this 
        title--
                (i) the adjusted community rate (as defined in 
            subsection (f)(3) of this section);
                (ii) the amount of the Medicare+Choice monthly basic 
            beneficiary premium;
                (iii) a description of the deductibles, coinsurance, and 
            copayments applicable under the plan, and the actuarial 
            value of such deductibles, coinsurance, and copayments, as 
            described in subsection (e)(4)(A) of this section; and
                (iv) if required under subsection (f)(1) of this 
            section, a description of the additional benefits to be 
            provided pursuant to such subsection and the value 
            determined for such proposed benefits under such subsection.

        (B) Supplemental benefits

            For benefits described in section 1395w-22(a)(3) of this 
        title, the amount of the Medicare+
        Choice monthly supplemental beneficiary premium (as defined in 
        subsection (b)(2)(B) of this section).

                             (5) Review

        (A) In general

            Subject to subparagraph (B), the Secretary shall review the 
        adjusted community rates, the amounts of the basic and 
        supplemental premiums, and values filed under this subsection 
        and shall approve or disapprove such rates, amounts, and value 
        so submitted.

        (B) Exception

            The Secretary shall not review, approve, or disapprove the 
        amounts submitted under paragraph (3) or subparagraphs (A)(ii) 
        and (B) of paragraph (4).

(b) Monthly premium charged

                           (1) In general

        (A) Rule for other than MSA plans

            The monthly amount of the premium charged to an individual 
        enrolled in a Medicare+Choice plan (other than an MSA plan) 
        offered by a Medicare+Choice organization shall be equal to the 
        sum of the Medicare+Choice monthly basic beneficiary premium and 
        the Medicare+Choice monthly supplementary beneficiary premium 
        (if any).

        (B) MSA plans

            The monthly amount of the premium charged to an individual 
        enrolled in an MSA plan offered by a Medicare+Choice 
        organization shall be equal to the Medicare+Choice monthly 
        supplemental beneficiary premium (if any).

                   (2) Premium terminology defined

        For purposes of this part:

        (A) The Medicare+Choice monthly basic beneficiary premium

            The term ``Medicare+Choice monthly basic beneficiary 
        premium'' means, with respect to a Medicare+Choice plan, the 
        amount authorized to be charged under subsection (e)(1) of this 
        section for the plan, or, in the case of a Medicare+Choice 
        private fee-for-service plan, the amount filed under subsection 
        (a)(4)(A)(ii) of this section.

        (B) Medicare+Choice monthly supplemental beneficiary premium

            The term ``Medicare+Choice monthly supplemental beneficiary 
        premium'' means, with respect to a Medicare+Choice plan, the 
        amount authorized to be charged under subsection (e)(2) of this 
        section for the plan or, in the case of a MSA plan or Medicare+
        Choice private fee-for-service plan, the amount filed under 
        paragraph (3)(B) or (4)(B) of subsection (a) of this section.

        (C) Medicare+Choice monthly MSA premium

            The term ``Medicare+Choice monthly MSA premium'' means, with 
        respect to a Medicare+Choice plan, the amount of such premium 
        filed under subsection (a)(3)(A) of this section for the plan.

(c) Uniform premium

    The Medicare+Choice monthly basic and supplemental beneficiary 
premium, the Medicare+
Choice monthly MSA premium charged under subsection (b) of this section 
of a Medicare+
Choice organization under this part may not vary among individuals 
enrolled in the plan.

(d) Terms and conditions of imposing premiums

    Each Medicare+Choice organization shall permit the payment of 
Medicare+Choice monthly basic and supplemental beneficiary premiums on a 
monthly basis, may terminate election of individuals for a 
Medicare+Choice plan for failure to make premium payments only in 
accordance with section 1395w-21(g)(3)(B)(i) of this title, and may not 
provide for cash or other monetary rebates as an inducement for 
enrollment or otherwise.

(e) Limitation on enrollee liability

                (1) For basic and additional benefits

        In no event may--
            (A) the Medicare+Choice monthly basic beneficiary premium 
        (multiplied by 12) and the actuarial value of the deductibles, 
        coinsurance, and copayments applicable on average to individuals 
        enrolled under this part with a Medicare+Choice plan described 
        in section 1395w-21(a)(2)(A) of this title of an organization 
        with respect to required benefits described in section 1395w-
        22(a)(1)(A) of this title and additional benefits (if any) 
        required under subsection (f)(1)(A) of this section for a year, 
        exceed
            (B) the actuarial value of the deductibles, coinsurance, and 
        copayments that would be applicable on average to individuals 
        entitled to benefits under part A of this subchapter and 
        enrolled under part B of this subchapter if they were not 
        members of a Medicare+Choice organization for the year.

                    (2) For supplemental benefits

        If the Medicare+Choice organization provides to its members 
    enrolled under this part in a Medicare+Choice plan described in 
    section 1395w-21(a)(2)(A) of this title with respect to supplemental 
    benefits described in section 1395w-22(a)(3) of this title, the sum 
    of the Medicare+Choice monthly supplemental beneficiary premium 
    (multiplied by 12) charged and the actuarial value of its 
    deductibles, coinsurance, and copayments charged with respect to 
    such benefits may not exceed the adjusted community rate for such 
    benefits (as defined in subsection (f)(3) of this section).

                  (3) Determination on other basis

        If the Secretary determines that adequate data are not available 
    to determine the actuarial value under paragraph (1)(A) or (2), the 
    Secretary may determine such amount with respect to all individuals 
    in same geographic area, the State, or in the United States, 
    eligible to enroll in the Medicare+Choice plan involved under this 
    part or on the basis of other appropriate data.

         (4) Special rule for private fee-for-service plans

        With respect to a Medicare+Choice private fee-for-service plan 
    (other than a plan that is an MSA plan), in no event may--
            (A) the actuarial value of the deductibles, coinsurance, and 
        copayments applicable on average to individuals enrolled under 
        this part with such a plan of an organization with respect to 
        required benefits described in section 1395w-22(a)(1) of this 
        title, exceed
            (B) the actuarial value of the deductibles, coinsurance, and 
        copayments that would be applicable on average to individuals 
        entitled to benefits under part A of this subchapter and 
        enrolled under part B of this subchapter if they were not 
        members of a Medicare+Choice organization for the year.

(f) Requirement for additional benefits

                           (1) Requirement

        (A) In general

            Each Medicare+Choice organization (in relation to a 
        Medicare+Choice plan, other than an MSA plan, it offers) shall 
        provide that if there is an excess amount (as defined in 
        subparagraph (B)) for the plan for a contract year, subject to 
        the succeeding provisions of this subsection, the organization 
        shall provide to individuals such additional benefits (as the 
        organization may specify) in a value which the Secretary 
        determines is at least equal to the adjusted excess amount (as 
        defined in subparagraph (C)).

        (B) Excess amount

            For purposes of this paragraph, the ``excess amount'', for 
        an organization for a plan, is the amount (if any) by which--
                (i) the average of the capitation payments made to the 
            organization under section 1395w-23 of this title for the 
            plan at the beginning of contract year, exceeds
                (ii) the actuarial value of the required benefits 
            described in section 1395w-22(a)(1)(A) of this title under 
            the plan for individuals under this part, as determined 
            based upon an adjusted community rate described in paragraph 
            (3) (as reduced for the actuarial value of the coinsurance, 
            copayments, and deductibles under parts A and B of this 
            subchapter).

        (C) Adjusted excess amount

            For purposes of this paragraph, the ``adjusted excess 
        amount'', for an organization for a plan, is the excess amount 
        reduced to reflect any amount withheld and reserved for the 
        organization for the year under paragraph (2).

        (D) Uniform application

            This paragraph shall be applied uniformly for all enrollees 
        for a plan.

        (E) Construction

            Nothing in this subsection shall be construed as preventing 
        a Medicare+Choice organization from providing supplemental 
        benefits (described in section 1395w-22(a)(3) of this title) 
        that are in addition to the health care benefits otherwise 
        required to be provided under this paragraph and from imposing a 
        premium for such supplemental benefits.

                       (2) Stabilization fund

        A Medicare+Choice organization may provide that a part of the 
    value of an excess amount described in paragraph (1) be withheld and 
    reserved in the Federal Hospital Insurance Trust Fund and in the 
    Federal Supplementary Medical Insurance Trust Fund (in such 
    proportions as the Secretary determines to be appropriate) by the 
    Secretary for subsequent annual contract periods, to the extent 
    required to stabilize and prevent undue fluctuations in the 
    additional benefits offered in those subsequent periods by the 
    organization in accordance with such paragraph. Any of such value of 
    the amount reserved which is not provided as additional benefits 
    described in paragraph (1)(A) to individuals electing the 
    Medicare+Choice plan of the organization in accordance with such 
    paragraph prior to the end of such periods, shall revert for the use 
    of such trust funds.

                     (3) Adjusted community rate

        For purposes of this subsection, subject to paragraph (4), the 
    term ``adjusted community rate'' for a service or services means, at 
    the election of a Medicare+Choice organization, either--
            (A) the rate of payment for that service or services which 
        the Secretary annually determines would apply to an individual 
        electing a Medicare+Choice plan under this part if the rate of 
        payment were determined under a ``community rating system'' (as 
        defined in section 300e-1(8) of this title, other than 
        subparagraph (C)), or
            (B) such portion of the weighted aggregate premium, which 
        the Secretary annually estimates would apply to such an 
        individual, as the Secretary annually estimates is attributable 
        to that service or services,

    but adjusted for differences between the utilization characteristics 
    of the individuals electing coverage under this part and the 
    utilization characteristics of the other enrollees with the plan 
    (or, if the Secretary finds that adequate data are not available to 
    adjust for those differences, the differences between the 
    utilization characteristics of individuals selecting other 
    Medicare+Choice coverage, or Medicare+Choice eligible individuals in 
    the area, in the State, or in the United States, eligible to elect 
    Medicare+Choice coverage under this part and the utilization 
    characteristics of the rest of the population in the area, in the 
    State, or in the United States, respectively).

            (4) Determination based on insufficient data

        For purposes of this subsection, if the Secretary finds that 
    there is insufficient enrollment experience to determine an average 
    of the capitation payments to be made under this part at the 
    beginning of a contract period or to determine (in the case of a 
    newly operated provider-sponsored organization or other new 
    organization) the adjusted community rate for the organization, the 
    Secretary may determine such an average based on the enrollment 
    experience of other contracts entered into under this part and may 
    determine such a rate using data in the general commercial 
    marketplace.

(g) Prohibition of State imposition of premium taxes

    No State may impose a premium tax or similar tax with respect to 
payments to Medicare+Choice organizations under section 1395w-23 of this 
title.

(h) Permitting use of segments of service areas

    The Secretary shall permit a Medicare+Choice organization to elect 
to apply the provisions of this section uniformly to separate segments 
of a service area (rather than uniformly to an entire service area) as 
long as such segments are composed of one or more Medicare+Choice 
payment areas.

(Aug. 14, 1935, ch. 531, title XVIII, Sec. 1854, as added Pub. L. 105-
33, title IV, Sec. 4001, Aug. 5, 1997, 111 Stat. 308; amended Pub. L. 
106-113, div. B, Sec. 1000(a)(6) [title III, Sec. 321(k)(6)(C), title V, 
Secs. 515(a), 516(a)], Nov. 29, 1999, 113 Stat. 1536, 1501A-367, 1501A-
384.)

                       References in Text

    Parts A and B of this subchapter, referred to in subsecs. (e)(1)(B), 
(4)(B) and (f)(1)(B)(ii), are classified to section 1395c et seq. and 
section 1395j et seq., respectively, of this title.


                               Amendments

    1999--Subsec. (a)(1). Pub. L. 106-113, Sec. 1000(a)(6) [title V, 
Sec. 516(a)], substituted ``July 1'' for ``May 1'' in introductory 
provisions.
    Pub. L. 106-113, Sec. 1000(a)(6) [title V, Sec. 515(a)(1)], inserted 
``(or segment of such an area if permitted under subsection (h) of this 
section)'' after ``service area'' in introductory provisions.
    Subsec. (a)(2)(A). Pub. L. 106-113, Sec. 1000(a)(6) [title III, 
Sec. 321(k)(6)(C)(i)(I)], inserted ``section'' before ``1395w-
22(a)(1)(A) of this title'' in introductory provisions.
    Subsec. (a)(2)(B). Pub. L. 106-113, Sec. 1000(a)(6) [title III, 
Sec. 321(k)(6)(C)(i)(II)], inserted ``section'' after ``described in'' 
in introductory provisions.
    Subsec. (a)(3)(A), (B). Pub. L. 106-113, Sec. 1000(a)(6) [title III, 
Sec. 321(k)(6)(C)(ii)], inserted ``section'' after ``described in''.
    Subsec. (a)(4). Pub. L. 106-113, Sec. 1000(a)(6) [title III, 
Sec. 321(k)(6)(C)(iii)(I)], which directed insertion of ``section'' 
after ``described in'', was executed by making the insertion after 
``described in'' the second time appearing in introductory provisions to 
reflect the probable intent of Congress.
    Subsec. (a)(4)(A). Pub. L. 106-113, Sec. 1000(a)(6) [title III, 
Sec. 321(k)(6)(C)(iii)(II)], inserted ``section'' after ``described in'' 
in introductory provisions.
    Subsec. (a)(4)(B). Pub. L. 106-113, Sec. 1000(a)(6) [title III, 
Sec. 321(k)(6)(C)(iii)(III)], inserted ``section'' after ``described 
in''.
    Subsec. (h). Pub. L. 106-113, Sec. 1000(a)(6) [title V, 
Sec. 515(a)(2)], added subsec. (h).


                    Effective Date of 1999 Amendment

    Amendment by section 1000(a)(6) [title III, Sec. 321(k)(6)(C)] of 
Pub. L. 106-113 effective as if included in the enactment of the 
Balanced Budget Act of 1997, Pub. L. 105-33, except as otherwise 
provided, see section 1000(a)(6) [title III, Sec. 321(m)] of Pub. L. 
106-113, set out as a note under section 1395d of this title.
    Pub. L. 106-113, div. B, Sec. 1000(a)(6) [title V, Sec. 515(b)], 
Nov. 29, 1999, 113 Stat. 1536, 1501A-384, provided that: ``The 
amendments made by this section [amending this section] apply to 
contract years beginning on or after January 1, 2001.''
    Pub. L. 106-113, div. B, Sec. 1000(a)(6) [title V, Sec. 516(b)], 
Nov. 29, 1999, 113 Stat. 1536, 1501A-384, provided that: ``The amendment 
made by subsection (a) [amending this section] applies to information 
submitted by Medicare+Choice organizations for years beginning with 
1999.''

                  Section Referred to in Other Sections

    This section is referred to in sections 1395w-22, 1395w-23, 1395w-
27, 1395w-28, 1395mm of this title.
