CMS Pub. 100-01, ch. 2, § 60

Medicare Part C, which is also known as Medicare+Choice, is a Medicare program that

gives beneficiaries more choices among health plans. Everyone who has Medicare Parts

A and B is eligible, except those who have end stage renal disease, and were not in a

Medicare+Choice plan at the onset of this condition.

Public Law 105-33, the Balanced Budget Act of 1997, establishes a new authority

permitting contracts between CMS and a variety of different managed care and fee-for-service entities. The types of entities that may be granted contracts under this new

authority include:

• Coordinated care plans, including Health Maintenance Organizations (HMOs),

Preferred Provider Organizations (PPOs), and Provider-Sponsored Organizations

You may be asked to show this card when you get health care services.

Only give your personal Medicare information to health care providers,

your insurers, or people you trust who work with Medicare on your behalf.

WARNING: Intentionally misusing this card may be considered fraud

and/or other violation of federal law and is punishable by law.

Es posible que le pidan que muestre esta tarjeta cuando reciba servicios de

cuidado médico. Solamente dé su información personal de Medicare a los

proveedores de salud, sus aseguradores o personas de su confianza que

trabajan con Medicare en su nombre.

¡ADVERTENCIA! El mal uso intencional de esta tarjeta puede ser

considerado como fraude y/u otra violación de la ley federal y es sancionada

por la ley.

1-800-MEDICARE (1-800-633-4227 /

TTY: 1-877-486-2048); Medicare.gov

(PSOs). A PSO is defined as a public or private entity established by health care

providers, which provide a substantial proportion of health care items and services

directly through affiliated providers who share, directly or indirectly, substantial

financial risk.

• Religious fraternal benefit society plans which may restrict enrollment to

members of the church, convention or group with which the society is affiliated.

Payments to such plans may be adjusted, as appropriate to take into account the

actuarial characteristics and experience of plan enrollees.

• Private fee-for-service plans which reimburse providers on a fee-for-service basis,

and are authorized to charge enrolled beneficiaries up to 115 percent of the plan's

payment schedule (which may be different from the Medicare fee schedule).

In addition to the Medicare+Choice contractors, beginning in January, 1999, up to

390,000 beneficiaries will have the choice (on a demonstration basis ending January 1,

2003) of enrolling in a Medical Savings Account (MSA) option. Under this option,

beneficiaries would obtain high deductible health policies that pay for at least all

Medicare-covered items and services after an enrollee meets the annual deductible of up

to $6,000. The difference between the premiums for such high deductible policies and

the applicable Medicare+Choice premium amount would be placed into an account for

the beneficiary to use in meeting his or her deductible expenses.

Past 1876 Contracts - HMO/CMP risk plans that remain in compliance with current

contracting standards and comply with new requirements established under this statutory

authority automatically transitioned into the Part C Medicare+Choice program. Section

1876 risk-based contractors were paid under a new Medicare+Choice payment

methodology rather than the prior method in section 1876(a), and were subject to certain

other Medicare+Choice provisions. The Secretary no longer accepts new 1876 risk

applications. As of January 1, 1999, existing 1876 risk-based contracts were terminated,

and plans in good standing transitioned to the Medicare+Choice program.

Repeal of Cost Option - As of August 5, 1997, the Secretary is prohibited from entering

into any new 1876 cost-based contracts, unless the plan is a Health Care Prepayment Plan

with an agreement under section 1833 of the Social Security Act. The 1876 cost-based

payment authority is repealed and all cost contracts are terminated as of December 31,

2002.

Limited HCPP Option - Beginning January 1, 1999, the Secretary may only contract

with those HCPPs that are sponsored by Union or Employer groups, or HCPPs that do

not "provide, or arrange for the provision of, any inpatient hospital services ...." This

amendment will result in the termination of section 1833 agreements with any

organization that does not meet the new definition. CMS will establish transition rules

for 1876 risk-based contractors that currently receive reimbursement on a cost basis for

enrollees remaining under a previous HCPP agreement.

For more information, see the Managed Care Manual.