Center for Medicare and Medicaid Services Issues a Final Rule on Medicare + Choice ("M+C")

On November 28, 2003 the Center for Medicare and Medicaid Services issued a final rule enabling Medicare + Choice ("M+C") plans to offer reductions in the standard Medicare Part B premium, with the intent of making M+C plans more attractive to beneficiaries. The rule makes conforming changes to the current M+C regulations to implement section 606 of the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 ("BIPA"). M+C organizations can elect to receive a reduction in their monthly capitation payments under 42 CFR § 422.250(a)(1), 80% of which would be applied to either reduce or eliminate the standard Medicare Part B premiums otherwise paid by, or on behalf of, Medicare enrollees. The new regulations, added as 42 CFR § 408.21, limit the premium reduction to an amount that cannot be greater than the standard premium amount determined for the year under § 1839 of BIPA. The premium reduction must be a multiple of 10 cents, and the reduction will be applied to all beneficiaries enrolled in the M+C plan, regardless of who pays or collects the premium. Finally, the reduction can never be less than zero and will not result in a payment to a beneficiary in any given month. To be eligible for the Part B premium reduction, beneficiaries must be enrolled in an M+C plan that offers the reduction as an additional benefit. After determining applicable premium reductions, CMS will notify beneficiaries of their new benefit check amounts.