CMS Pub. 100-16, ch. 11, § 50

Program

(Rev. 79, Issued 02-17-06, Effective Date 02-17-06)

An MA organization will be subject to a 2-year contracting prohibition when the

organization leaves the MA program entirely by non-renewing all of its MA contracts. As

long as an MA organization continues to offer at least one MA plan, the prohibition will

not apply. If an MA organization that non-renews all of its MA contracts proposes to

return to Medicare contracting within the 2-year time period, the organization must

provide a written request to CMS asking for an exemption to the prohibition based on

special circumstances. The MA organization will automatically be permitted to re-enter

the program as of the beginning of the next calendar year if, during the 6-month period

beginning on the date the organization notified CMS of the intention to non-renew all of

its MA contracts, there was a change in the statute or regulations that had the effect of

increasing MA payments in the payment area or areas at issue. The MA organization will

also be permitted to re-enter the program if "circumstances. . .warrant special

consideration." CMS will evaluate proposed special circumstance requests on a case-by-case basis. However, there are certain special circumstances under which CMS generally

will grant an exemption to the 2-year contracting prohibition to allow the MA

organization to offer an MA or MA-PD plan as of the beginning of the next calendar

year. These circumstances are:

1. The organization is proposing to introduce an MA plan(s) in a geographic area(s)

currently served by two or fewer MA plans;

2. The organization is proposing to introduce MA plans in counties other than the

counties they had previously withdrawn from when they ended their earlier

contract with the Medicare program;

3. The organization proposes to offer a different MA plan type than they had

previously offered. For example, an organization that had offered a health

maintenance organization may want to reenter the program and offer a preferred

provider organization;

4. The organization has undergone a significant change such as a merger or

acquisition and could thereby demonstrate that the new entity is essentially a

different organization from the one that severed its contracting relationship with

CMS. CMS reserves the right to make a determination whether the nature and

extent of the organizational change is sufficient to consider the organization as a

new entity, and therefore, no longer subjected to the 2-year contracting

prohibition.

In addition, CMS may grant an exception based on other "special circumstances" than

those above, at CMS' discretion.