CMS Pub. 100-16, ch. 1, § 10

The Balanced Budget Act of 1997 (BBA) (Public Law 105-33) established a new Part C

of the Medicare program, known then as the Medicare+Choice (M+C) program, effective

January 1999. As part of the M+C program, the BBA authorized CMS to contract with

public or private organizations to offer a variety of health plan options for beneficiaries,

including both traditional managed care plans (such as those offered by Health

Maintenance Organizations (HMOs) under §1876 of the Social Security Act) and new

options that were not previously authorized. Four types of M+C plans were authorized

under the new Part C of Medicare:

• Coordinated care plans (CCPs), including:

o HMOs (with or without Point-of-Service (POS) options;

o Provider Sponsored Organizations (PSOs); and

o Preferred Provider Organizations (PPOs).

• Medicare Medical Savings Account (MSA) plans;

• Private Fee-for-Service (PFFS) plans; and

• Religious Fraternal Brotherhood Societies (RFB).

The Part C program of Medicare was renamed the Medicare Advantage (MA) Program

pursuant to Title II of the Medicare Prescription Drug, Improvement, and Modernization

Act of 2003 (MMA) (Public Law 108-173), which was enacted on December 8, 2003.

The MMA updated and improved the choice of plans for beneficiaries under MA, and

changed the way benefits are established and payments are made. Under the MMA,

beneficiaries may choose from additional plan options, including regional PPO (RPPO)

plans and special needs plans (SNPs). Title I of the MMA further established the

Medicare prescription drug benefit (Part D) program, and amended the MA program to

allow, and in some cases require, MA plans to offer prescription drug coverage. More

information about prescription drug requirements can be found in the Medicare

Prescription Drug Benefit Manual at http://www.cms.gov/Medicare/Prescription-Drug-

Coverage/PrescriptionDrugCovContra/PartDManuals.html page.

On July 15, 2008, the Medicare Improvements for Patients and Providers Act (MIPPA)

(Public Law 110-275) was enacted, revising and amending statutory provisions governing

the MA and Part D programs. Among these were provisions that established new rules

for PFFS plans, SNPs, and Section 1876 cost plans.

In 2010, the Patient Protection and Affordable Care Act (Public Law 111-148) and the

Health Care and Education Reconciliation Act (Public Law 111-152) were enacted and

are collectively referred to as the Affordable Care Act (ACA). The ACA includes

significant reforms to both the private health insurance industry and the Medicare and

Medicaid programs. Provisions in the ACA concerning the MA and Part D programs

largely focus on beneficiary protections, MA payments, and simplification of MA and

Part D program processes.

CMS implemented the MA and Part D provisions specified in the ACA through

regulations at 42 CFR 422 and 423.