§1395w–116 Medicare Prescription Drug Account in the Federal Supplementary Medical Insurance Trust Fund

Summary

Creates a Medicare Prescription Drug Account inside the Federal Supplementary Medical Insurance Trust Fund. The Account holds gifts and bequests under section 401(i)(1), interest on its balance, and any deposits or appropriations made under this part. Money in the Account is kept separate from other Trust Fund money but is invested and redeemed the same way as the rest of the Trust Fund. The Managing Trustee must pay out money the Secretary certifies is needed to run the prescription drug program. That includes low-income subsidies, other subsidy and fallback plan payments, payments to qualified retiree drug plan sponsors, program administrative costs, and selected drug subsidy payments. The Trustee must also transfer amounts to the Grants to States for Medicaid account tied to increases from applying section 1396u–5(b), and must pay collected premiums and parts of late-enrollment penalties to Part D plan sponsors and MA organizations as described in law. Amounts from the Account are not used when calculating actuarial rates or premiums under section 1395r. The Account also receives deposits from payments and offsets under section 1396u–5(c), amounts withheld under sections 1395w–113(c) and 1395w–24(d), and any transferred balance from the Transitional Assistance Account under section 1395w–141(k)(5). Congress may appropriate Treasury funds equal to payments made from the Account plus a needed contingency margin (reduced by the deposits above), and may, at the program start, appropriate up to 10 percent of the Account’s estimated 2006 expenditures for prompt payments and an initial reserve.