§1395w–131 Application to Medicare Advantage program and related managed care programs

Summary

Starting January 1, 2006, Medicare Advantage (MA) organizations must include prescription drug coverage when they offer certain MA plans in a service area. They cannot sell an MA plan of the specified type there unless that plan—or another MA plan they offer in the same area—has the required drug coverage. They also may not sell separate prescription drug coverage through an MSA plan, and other MA plans may only offer drug coverage if it is “qualified” and meets the rules. “Required coverage” means either basic drug coverage or qualified supplemental drug coverage that does not charge an extra monthly supplemental premium because a rebate credit is applied. People are not automatically treated as having chosen an MA plan with drug coverage unless their prior plan actually had drug benefits. For the January 1, 2006 transition, whether someone is treated as having elected an MA plan with drugs depends on whether their plan had drug coverage on December 31, 2005. If someone leaves an MA–PD plan and goes back to original Medicare, they are allowed to join a Part D prescription drug plan when they switch. If an MA organization stops offering MA plans that lack drug coverage, affected enrollees are treated as returning to original Medicare unless they actively pick an MA–PD plan; that forced move is treated like an involuntary termination for certain administrative rules. The government may waive some Part C rules for MA–PD drug coverage to avoid conflicts or duplication and may relax pharmacy access rules if an organization’s own pharmacies give good access. Special exceptions and payment rules apply to certain kinds of MA plans and to organizations running reasonable-cost contracts or PACE programs that choose to offer qualified drug coverage; those offerings can be treated like MA–PD local plans but may only enroll their own contract or program participants, and their bids are not counted in national average calculations.