42 U.S.C. § 1395ss — Certification of medicare supplemental

Page 3774 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss (I) interpretation by a ‘‘B Reader’’ qualified physician of a plain chest x-ray or interpretation of a computed tomo- graphic radiograph of the chest by a qualified physician, as determined by the Secretary; or (II) such other diagnostic standards as the Secretary specifies, except that this clause shall not apply to pleural thickening or pleural plaques un- less there are symptoms or conditions re- quiring medical treatment as a result of these diagnoses. (ii) Mesothelioma, or malignancies of the lung, colon, rectum, larynx, stomach, esophagus, pharynx, or ovary, as estab- lished by— (I) pathologic examination of biopsy tissue; (II) cytology from bronchioalveolar la- vage; or (III) such other diagnostic standards as the Secretary specifies. (iii) Any other diagnosis which the Sec- retary, in consultation with the Commis- sioner of Social Security, determines is an asbestos-related medical condition, as es- tablished by such diagnostic standards as the Secretary specifies. (3) Other individual described An individual described in this paragraph is any individual who— (A) is not an individual described in para- graph (2); (B) is diagnosed with a medical condition caused by the exposure of the individual to a public health hazard to which an emergency declaration applies, based on such medical conditions, diagnostic standards, and other criteria as the Secretary specifies; (C) as demonstrated in such manner as the Secretary determines appropriate, has been present for an aggregate total of 6 months in the geographic area subject to the emer- gency declaration involved, during a period determined appropriate by the Secretary; (D) files an application for benefits under this subchapter (or has an application filed on behalf of the individual), including pursu- ant to this section; and (E) is determined under this section to meet the criteria in this paragraph. (Aug. 14, 1935, ch. 531, title XVIII, § 1881A, as added Pub. L. 111–148, title X, § 10323(a), Mar. 23, 2010, 124 Stat. 954.) Editorial Notes REFERENCES IN TEXT Parts A and B, referred to in subsecs. (a)(3) and (b)(2), are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title. § 1395ss. Certification of medicare supplemental health insurance policies (a) Submission of policy by insurer (1) The Secretary shall establish a procedure whereby medicare supplemental policies (as de- fined in subsection (g)(1)) may be certified by the Secretary as meeting minimum standards and requirements set forth in subsection (c). Such procedure shall provide an opportunity for any insurer to submit any such policy, and such additional data as the Secretary finds necessary, to the Secretary for his examination and for his certification thereof as meeting the standards and requirements set forth in subsection (c). Subject to subsections (k)(3), (m), and (n), such certification shall remain in effect if the insurer files a notarized statement with the Secretary no later than June 30 of each year stating that the policy continues to meet such standards and requirements and if the insurer submits such ad- ditional data as the Secretary finds necessary to independently verify the accuracy of such nota- rized statement. Where the Secretary deter- mines such a policy meets (or continues to meet) such standards and requirements, he shall authorize the insurer to have printed on such policy (but only in accordance with such re- quirements and conditions as the Secretary may prescribe) an emblem which the Secretary shall cause to be designed for use as an indication that a policy has received the Secretary’s cer- tification. The Secretary shall provide each State commissioner or superintendent of insur- ance with a list of all the policies which have re- ceived his certification. (2) No medicare supplemental policy may be issued in a State on or after the date specified in subsection (p)(1)(C) unless— (A) the State’s regulatory program under subsection (b)(1) provides for the application and enforcement of the standards and require- ments set forth in such subsection (including the 1991 NAIC Model Regulation or 1991 Fed- eral Regulation (as the case may be)) by the date specified in subsection (p)(1)(C); or (B) if the State’s program does not provide for the application and enforcement of such standards and requirements, the policy has been certified by the Secretary under para- graph (1) as meeting the standards and re- quirements set forth in subsection (c) (includ- ing such applicable standards) by such date. Any person who issues a medicare supplemental policy, on and after the effective date specified in subsection (p)(1)(C), in violation of this para- graph is subject to a civil money penalty of not to exceed $25,000 for each such violation. The provisions of section 1320a–7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1320a–7a(a) of this title. (b) Standards and requirements; periodic review by Secretary (1) Any medicare supplemental policy issued in any State which the Secretary determines has established under State law a regulatory program that— (A) provides for the application and enforce- ment of standards with respect to such poli- cies equal to or more stringent than the NAIC Model Standards (as defined in subsection (g)(2)(A)), except as otherwise provided by sub- paragraph (H); Page 3775 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss (B) includes requirements equal to or more stringent than the requirements described in paragraphs (2) through (5) of subsection (c); (C) provides that— (i) information with respect to the actual ratio of benefits provided to premiums col- lected under such policies will be reported to the State on forms conforming to those de- veloped by the National Association of In- surance Commissioners for such purpose, or (ii) such ratios will be monitored under the program in an alternative manner approved by the Secretary, and that a copy of each such policy, the most recent premium for each such policy, and a listing of the ratio of benefits provided to premiums collected for the most recent 3-year period for each such policy issued or sold in the State is main- tained and made available to interested per- sons; (D) provides for application and enforcement of the standards and requirements described in subparagraphs (A), (B), and (C) to all medicare supplemental policies (as defined in subsection (g)(1)) issued in such State, (E) provides the Secretary periodically (but at least annually) with a list containing the name and address of the issuer of each such policy and the name and number of each such policy (including an indication of policies that have been previously approved, newly ap- proved, or withdrawn from approval since the previous list was provided), (F) reports to the Secretary on the imple- mentation and enforcement of standards and requirements of this paragraph at intervals es- tablished by the Secretary, (G) provides for a process for approving or disapproving proposed premium increases with respect to such policies, and establishes a pol- icy for the holding of public hearings prior to approval of a premium increase, and (H) in the case of a policy that meets the standards under subparagraph (A) except that benefits under the policy are limited to items and services furnished by certain entities (or reduced benefits are provided when items or services are furnished by other entities), pro- vides for the application of requirements equal to or more stringent than the requirements under subsection (t), shall be deemed (subject to subsections (k)(3), (m), and (n), for so long as the Secretary finds that such State regulatory program continues to meet the standards and requirements of this paragraph) to meet the standards and require- ments set forth in subsection (c). Each report re- quired under subparagraph (F) shall include in- formation on loss ratios of policies sold in the State, frequency and types of instances in which policies approved by the State fail to meet the standards and requirements of this paragraph, actions taken by the State to bring such policies into compliance, information regarding State programs implementing consumer protection provisions, and such further information as the Secretary in consultation with the National As- sociation of Insurance Commissioners may specify. (2) The Secretary periodically shall review State regulatory programs to determine if they continue to meet the standards and require- ments specified in paragraph (1). If the Sec- retary finds that a State regulatory program no longer meets the standards and requirements, before making a final determination, the Sec- retary shall provide the State an opportunity to adopt such a plan of correction as would permit the State regulatory program to continue to meet such standards and requirements. If the Secretary makes a final determination that the State regulatory program, after such an oppor- tunity, fails to meet such standards and require- ments, the program shall no longer be consid- ered to have in operation a program meeting such standards and requirements. (3) Notwithstanding paragraph (1), a medicare supplemental policy offered in a State shall not be deemed to meet the standards and require- ments set forth in subsection (c), with respect to an advertisement (whether through written, radio, or television medium) used (or, at a State’s option, to be used) for the policy in the State, unless the entity issuing the policy pro- vides a copy of each advertisement to the Com- missioner of Insurance (or comparable officer identified by the Secretary) of that State for re- view or approval to the extent it may be re- quired under State law. (c) Requisite findings The Secretary shall certify under this section any medicare supplemental policy, or continue certification of such a policy, only if he finds that such policy (or, with respect to paragraph (3) or the requirement described in subsection (s), the issuer of the policy)— (1) meets or exceeds (either in a single policy or, in the case of nonprofit hospital and med- ical service associations, in one or more poli- cies issued in conjunction with one another) the NAIC Model Standards (except as other- wise provided by subsection (t)); (2) meets the requirements of subsection (r); (3)(A) accepts a notice under section 1395u(h)(3)(B) of this title as a claim form for benefits under such policy in lieu of any claim form otherwise required and agrees to make a payment determination on the basis of the in- formation contained in such notice; (B) where such a notice is received— (i) provides notice to such physician or supplier and the beneficiary of the payment determination under the policy, and (ii) provides any payment covered by such policy directly to the participating physi- cian or supplier involved; (C) provides each enrollee at the time of en- rollment a card listing the policy name and number and a single mailing address to which notices under section 1395u(h)(3)(B) of this title respecting the policy are to be sent; (D) agrees to pay any user fees established under section 1395u(h)(3)(B) of this title with respect to information transmitted to the issuer of the policy; and (E) provides to the Secretary at least annu- ally, for transmittal to carriers, a single mail- ing address to which notices under section 1395u(h)(3)(B) of this title respecting the policy are to be sent; (4) may, during a period of not less than 30 days after the policy is issued, be returned for Page 3776 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss a full refund of any premiums paid (without regard to the manner in which the purchase of the policy was solicited); and (5) meets the applicable requirements of sub- sections (o) through (t). (d) Criminal penalties; civil penalties for certain violations (1) Whoever knowingly and willfully makes or causes to be made or induces or seeks to induce the making of any false statement or represen- tation of a material fact with respect to the compliance of any policy with the standards and requirements set forth in subsection (c) or in regulations promulgated pursuant to such sub- section, or with respect to the use of the em- blem designed by the Secretary under sub- section (a), shall be fined under title 18 or im- prisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to ex- ceed $5,000 for each such prohibited act. (2) Whoever falsely assumes or pretends to be acting, or misrepresents in any way that he is acting, under the authority of or in association with, the program of health insurance estab- lished by this subchapter, or any Federal agen- cy, for the purpose of selling or attempting to sell insurance, or in such pretended character demands, or obtains money, paper, documents, or anything of value, shall be fined under title 18 or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $5,000 for each such prohibited act. (3)(A)(i) It is unlawful for a person to sell or issue to an individual entitled to benefits under part A or enrolled under part B of this sub- chapter (including an individual electing a Medicare+Choice plan under section 1395w–21 of this title)— (I) a health insurance policy with knowledge that the policy duplicates health benefits to which the individual is otherwise entitled under this subchapter or subchapter XIX, (II) in the case of an individual not electing a Medicare+Choice plan, a medicare supple- mental policy with knowledge that the indi- vidual is entitled to benefits under another medicare supplemental policy or in the case of an individual electing a Medicare+Choice plan, a medicare supplemental policy with knowl- edge that the policy duplicates health benefits to which the individual is otherwise entitled under the Medicare+Choice plan or under an- other medicare supplemental policy, or (III) a health insurance policy (other than a medicare supplemental policy) with knowl- edge that the policy duplicates health benefits to which the individual is otherwise entitled, other than benefits to which the individual is entitled under a requirement of State or Fed- eral law. (ii) Whoever violates clause (i) shall be fined under title 18 or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a person other than the issuer of the policy) for each such prohibited act. (iii) A seller (who is not the issuer of a health insurance policy) shall not be considered to vio- late clause (i)(II) with respect to the sale of a medicare supplemental policy if the policy is sold in compliance with subparagraph (B). (iv) For purposes of this subparagraph, a health insurance policy (other than a Medicare supplemental policy) providing for benefits which are payable to or on behalf of an indi- vidual without regard to other health benefit coverage of such individual is not considered to ‘‘duplicate’’ any health benefits under this sub- chapter, under subchapter XIX, or under a health insurance policy, and subclauses (I) and (III) of clause (i) do not apply to such a policy. (v) For purposes of this subparagraph, a health insurance policy (or a rider to an insurance con- tract which is not a health insurance policy) is not considered to ‘‘duplicate’’ health benefits under this subchapter or under another health insurance policy if it— (I) provides health care benefits only for long-term care, nursing home care, home health care, or community-based care, or any combination thereof, (II) coordinates against or excludes items and services available or paid for under this subchapter or under another health insurance policy, and (III) for policies sold or issued on or after the end of the 90-day period beginning on August 21, 1996, discloses such coordination or exclu- sion in the policy’s outline of coverage. For purposes of this clause, the terms ‘‘coordi- nates’’ and ‘‘coordination’’ mean, with respect to a policy in relation to health benefits under this subchapter or under another health insur- ance policy, that the policy under its terms is secondary to, or excludes from payment, items and services to the extent available or paid for under this subchapter or under another health insurance policy. (vi)(I) An individual entitled to benefits under part A or enrolled under part B of this sub- chapter who is applying for a health insurance policy (other than a policy described in sub- clause (III)) shall be furnished a disclosure state- ment described in clause (vii) for the type of pol- icy being applied for. Such statement shall be furnished as a part of (or together with) the ap- plication for such policy. (II) Whoever issues or sells a health insurance policy (other than a policy described in sub- clause (III)) to an individual described in sub- clause (I) and fails to furnish the appropriate disclosure statement as required under such sub- clause shall be fined under title 18, or impris- oned not more than 5 years, or both, and, in ad- dition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a person other than the issuer of the policy) for each such vio- lation. (III) A policy described in this subclause (to which subclauses (I) and (II) do not apply) is a Medicare supplemental policy, a policy de- scribed in clause (v), or a health insurance pol- icy identified under 60 Federal Register 30880 (June 12, 1995) as a policy not required to have a disclosure statement. (IV) Any reference in this section to the re- vised NAIC model regulation (referred to in sub- section (m)(1)(A)) is deemed a reference to such Page 3777 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss regulation as revised by section 171(m)(2) of the Social Security Act Amendments of 1994 (Public Law 103–432) and as modified by substituting, for the disclosure required under section 16D(2), dis- closure under subclause (I) of an appropriate dis- closure statement under clause (vii). (vii) The disclosure statement described in this clause for a type of policy is the statement specified under subparagraph (D) of this para- graph (as in effect before August 21, 1996) for that type of policy, as revised as follows: (I) In each statement, amend the second line to read as follows: ‘‘THIS IS NOT MEDICARE SUPPLEMENT INSURANCE’’. (II) In each statement, strike the third line and insert the following: ‘‘Some health care services paid for by Medicare may also trigger the payment of benefits under this policy.’’. (III) In each statement not described in sub- clause (V), strike the boldface matter that be- gins ‘‘This insurance’’ and all that follows up to the next paragraph that begins ‘‘Medicare’’. (IV) In each statement not described in sub- clause (V), insert before the boxed matter (that states ‘‘Before You Buy This Insurance’’) the following: ‘‘This policy must pay benefits without regard to other health benefit cov- erage to which you may be entitled under Medicare or other insurance.’’. (V) In a statement relating to policies pro- viding both nursing home and non-institu- tional coverage, to policies providing nursing home benefits only, or policies providing home care benefits only, amend the sentence that begins ‘‘Federal law’’ to read as follows: ‘‘Fed- eral law requires us to inform you that in cer- tain situations this insurance may pay for some care also covered by Medicare.’’. (viii)(I) Subject to subclause (II), nothing in this subparagraph shall restrict or preclude a State’s ability to regulate health insurance poli- cies, including any health insurance policy that is described in clause (iv), (v), or (vi)(III). (II) A State may not declare or specify, in statute, regulation, or otherwise, that a health insurance policy (other than a Medicare supple- mental policy) or rider to an insurance contract which is not a health insurance policy, that is described in clause (iv), (v), or (vi)(III) and that is sold, issued, or renewed to an individual enti- tled to benefits under part A or enrolled under part B ‘‘duplicates’’ health benefits under this subchapter or under a Medicare supplemental policy. (B)(i) It is unlawful for a person to issue or sell a medicare supplemental policy to an individual entitled to benefits under part A or enrolled under part B, whether directly, through the mail, or otherwise, unless— (I) the person obtains from the individual, as part of the application for the issuance or pur- chase and on a form described in clause (ii), a written statement signed by the individual stating, to the best of the individual’s knowl- edge, what health insurance policies (includ- ing any Medicare+Choice plan) the individual has, from what source, and whether the indi- vidual is entitled to any medical assistance under subchapter XIX, whether as a qualified medicare beneficiary or otherwise, and (II) the written statement is accompanied by a written acknowledgment, signed by the sell- er of the policy, of the request for and receipt of such statement. (ii) The statement required by clause (i) shall be made on a form that— (I) states in substance that a medicare-eligi- ble individual does not need more than one medicare supplemental policy, (II) states in substance that individuals may be eligible for benefits under the State med- icaid program under subchapter XIX and that such individuals who are entitled to benefits under that program usually do not need a medicare supplemental policy and that bene- fits and premiums under any such policy shall be suspended upon request of the policyholder during the period (of not longer than 24 months) of entitlement to benefits under such subchapter and may be reinstituted upon loss of such entitlement, and (III) states that counseling services may be available in the State to provide advice con- cerning the purchase of medicare supple- mental policies and enrollment under the med- icaid program and may provide the telephone number for such services. (iii)(I) Except as provided in subclauses (II) and (III), if the statement required by clause (i) is not obtained or indicates that the individual has a medicare supplemental policy or indicates that the individual is entitled to any medical as- sistance under subchapter XIX, the sale of a medicare supplemental policy shall be consid- ered to be a violation of subparagraph (A). (II) Subclause (I) shall not apply in the case of an individual who has a medicare supplemental policy, if the individual indicates in writing, as part of the application for purchase, that the policy being purchased replaces such other pol- icy and indicates an intent to terminate the pol- icy being replaced when the new policy becomes effective and the issuer or seller certifies in writing that such policy will not, to the best of the issuer’s or seller’s knowledge, duplicate cov- erage (taking into account any such replace- ment). (III) If the statement required by clause (i) is obtained and indicates that the individual is en- titled to any medical assistance under sub- chapter XIX, the sale of the policy is not in vio- lation of clause (i) (insofar as such clause relates to such medical assistance), if (aa) a State med- icaid plan under such subchapter pays the pre- miums for the policy, (bb) in the case of a quali- fied medicare beneficiary described in section 1396d(p)(1) of this title, the policy provides for coverage of outpatient prescription drugs, or (cc) the only medical assistance to which the in- dividual is entitled under the State plan is medi- care cost sharing described in section 1396d(p)(3)(A)(ii) of this title. (iv) Whoever issues or sells a medicare supple- mental policy in violation of this subparagraph shall be fined under title 18, or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a seller who is not the issuer of a policy) for each such violation. Page 3778 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss (C) Subparagraph (A) shall not apply with re- spect to the sale or issuance of a group policy or plan of one or more employers or labor organiza- tions, or of the trustees of a fund established by one or more employers or labor organizations (or combination thereof), for employees or former employees (or combination thereof) or for members or former members (or combination thereof) of the labor organizations. (4)(A) Whoever knowingly, directly or through his agent, mails or causes to be mailed any mat- ter for a prohibited purpose (as determined under subparagraph (B)) shall be fined under title 18 or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $5,000 for each such pro- hibited act. (B) For purposes of subparagraph (A), a prohib- ited purpose means the advertising, solicitation, or offer for sale of a medicare supplemental pol- icy, or the delivery of such a policy, in or into any State in which such policy has not been ap- proved by the State commissioner or super- intendent of insurance. (C) Subparagraph (A) shall not apply in the case of a person who mails or causes to be mailed a medicare supplemental policy into a State if such person has ascertained that the party insured under such policy to whom (or on whose behalf) such policy is mailed is located in such State on a temporary basis. (D) Subparagraph (A) shall not apply in the case of a person who mails or causes to be mailed a duplicate copy of a medicare supple- mental policy previously issued to the party to whom (or on whose behalf) such duplicate copy is mailed. (E) Subparagraph (A) shall not apply in the case of an issuer who mails or causes to be mailed a policy, certificate, or other matter solely to comply with the requirements of sub- section (q). (5) The provisions of section 1320a–7a of this title (other than subsections (a) and (b)) shall apply to civil money penalties under paragraphs (1), (2), (3)(A), and (4)(A) in the same manner as such provisions apply to penalties and pro- ceedings under section 1320a–7a(a) of this title. (e) Dissemination of information (1) The Secretary shall provide to all individ- uals entitled to benefits under this subchapter (and, to the extent feasible, to individuals about to become so entitled) such information as will permit such individuals to evaluate the value of medicare supplemental policies to them and the relationship of any such policies to benefits pro- vided under this subchapter. (2) The Secretary shall— (A) inform all individuals entitled to bene- fits under this subchapter (and, to the extent feasible, individuals about to become so enti- tled) of— (i) the actions and practices that are sub- ject to sanctions under subsection (d), and (ii) the manner in which they may report any such action or practice to an appro- priate official of the Department of Health and Human Services (or to an appropriate State official), and (B) publish the toll-free telephone number for individuals to report suspected violations of the provisions of such subsection. (3) The Secretary shall provide individuals en- titled to benefits under this subchapter (and, to the extent feasible, individuals about to become so entitled) with a listing of the addresses and telephone numbers of State and Federal agen- cies and offices that provide information and as- sistance to individuals with respect to the selec- tion of medicare supplemental policies. (f) Study and evaluation of comparative effec- tiveness of various State approaches to regu- lating medicare supplemental policies; report to Congress no later than January 1, 1982; periodic evaluations (1)(A) The Secretary shall, in consultation with Federal and State regulatory agencies, the National Association of Insurance Commis- sioners, private insurers, and organizations rep- resenting consumers and the aged, conduct a comprehensive study and evaluation of the com- parative effectiveness of various State ap- proaches to the regulation of medicare supple- mental policies in (i) limiting marketing and agent abuse, (ii) assuring the dissemination of such information to individuals entitled to bene- fits under this subchapter (and to other con- sumers) as is necessary to permit informed choice, (iii) promoting policies which provide reasonable economic benefits for such individ- uals, (iv) reducing the purchase of unnecessary duplicative coverage, (v) improving price com- petition, and (vi) establishing effective approved State regulatory programs described in sub- section (b). (B) Such study shall also address the need for standards or certification of health insurance policies, other than medicare supplemental poli- cies, sold to individuals eligible for benefits under this subchapter. (C) The Secretary shall, no later than January 1, 1982, submit a report to the Congress on the results of such study and evaluation, accom- panied by such recommendations as the Sec- retary finds warranted by such results with re- spect to the need for legislative or administra- tive changes to accomplish the objectives set forth in subparagraphs (A) and (B), including the need for a mandatory Federal regulatory pro- gram to assure the marketing of appropriate types of medicare supplemental policies, and such other means as he finds may be appropriate to enhance effective State regulation of such policies. (2) The Secretary shall submit to the Congress no later than July 1, 1982, and periodically as may be appropriate thereafter (but not less often than once every 2 years), a report evalu- ating the effectiveness of the certification pro- cedure and the criminal penalties established under this section, and shall include in such re- ports an analysis of— (A) the impact of such procedure and pen- alties on the types, market share, value, and cost to individuals entitled to benefits under this subchapter of medicare supplemental poli- cies which have been certified by the Sec- retary; Page 3779 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss (B) the need for any change in the certifi- cation procedure to improve its administra- tion or effectiveness; and (C) whether the certification program and criminal penalties should be continued. (3) The Secretary shall provide information via a toll-free telephone number on medicare supplemental policies (including the relation- ship of State programs under subchapter XIX to such policies). (g) Definitions (1) For purposes of this section, a medicare supplemental policy is a health insurance policy or other health benefit plan offered by a private entity to individuals who are entitled to have payment made under this subchapter, which provides reimbursement for expenses incurred for services and items for which payment may be made under this subchapter but which are not reimbursable by reason of the applicability of deductibles, coinsurance amounts, or other limi- tations imposed pursuant to this subchapter; but does not include a prescription drug plan under part D or a Medicare+Choice plan or any such policy or plan of one or more employers or labor organizations, or of the trustees of a fund established by one or more employers or labor organizations (or combination thereof), for em- ployees or former employees (or combination thereof) or for members or former members (or combination thereof) of the labor organizations and does not include a policy or plan of an eligi- ble organization (as defined in section 1395mm(b) of this title) if the policy or plan provides bene- fits pursuant to a contract under section 1395mm of this title or an approved demonstra- tion project described in section 603(c) of the So- cial Security Amendments of 1983, section 2355 of the Deficit Reduction Act of 1984, or section 9412(b) of the Omnibus Budget Reconciliation Act of 1986, or a policy or plan of an organiza- tion if the policy or plan provides benefits pur- suant to an agreement under section 1395l(a)(1)(A) of this title. For purposes of this section, the term ‘‘policy’’ includes a certificate issued under such policy. (2) For purposes of this section: (A) The term ‘‘NAIC Model Standards’’ means the ‘‘NAIC Model Regulation to Imple- ment the Individual Accident and Sickness In- surance Minimum Standards Act’’, adopted by the National Association of Insurance Com- missioners on June 6, 1979, as it applies to medicare supplemental policies. (B) The term ‘‘State with an approved regu- latory program’’ means a State for which the Secretary has made a determination under subsection (b)(1). (C) The State in which a policy is issued means— (i) in the case of an individual policy, the State in which the policyholder resides; and (ii) in the case of a group policy, the State in which the holder of the master policy re- sides. (h) Rules and regulations The Secretary shall prescribe such regulations as may be necessary for the effective, efficient, and equitable administration of the certification procedure established under this section. The Secretary shall first issue final regulations to implement the certification procedure estab- lished under subsection (a) not later than March 1, 1981. (i) Commencement of certification program (1) No medicare supplemental policy shall be certified and no such policy may be issued bear- ing the emblem authorized by the Secretary under subsection (a) until July 1, 1982. On and after such date policies certified by the Sec- retary may bear such emblem, including policies which were issued prior to such date and were subsequently certified, and insurers may notify holders of such certified policies issued prior to such date using such emblem in the notification. (2)(A) The Secretary shall not implement the certification program established under sub- section (a) with respect to policies issued in a State unless the Panel makes a finding that such State cannot be expected to have estab- lished, by July 1, 1982, an approved State regu- latory program meeting the standards and re- quirements of subsection (b)(1). If the Panel makes such a finding, the Secretary shall imple- ment such program under subsection (a) with re- spect to medicare supplemental policies issued in such State, until such time as the Panel de- termines that such State has a program that meets the standards and requirements of sub- section (b)(1). (B) Any finding by the Panel under subpara- graph (A) shall be transmitted in writing, not later than January 1, 1982, to the Committee on Finance of the Senate and to the Committee on Energy and Commerce and the Committee on Ways and Means of the House of Representatives and shall not become effective until 60 days after the date of its transmittal to the Commit- tees of the Congress under this subparagraph. In counting such days, days on which either House is not in session because of an adjournment sine die or an adjournment of more than three days to a day certain are excluded in the computa- tion. (j) State regulation of policies issued in other States Nothing in this section shall be construed so as to affect the right of any State to regulate medicare supplemental policies which, under the provisions of this section, are considered to be issued in another State. (k) Amended NAIC Model Regulation or Federal model standards applicable; effective date; medicare supplemental policy and State reg- ulatory program meeting applicable stand- ards (1)(A) If, within the 90-day period beginning on July 1, 1988, the National Association of Insur- ance Commissioners (in this subsection referred to as the ‘‘Association’’) amends the NAIC Model Regulation adopted on June 6, 1979 (as it relates to medicare supplemental policies), with respect to matters such as minimum benefit standards, loss ratios, disclosure requirements, and replacement requirements and provisions otherwise necessary to reflect the changes in law made by the Medicare Catastrophic Cov- erage Act of 1988, except as provided in sub- Page 3780 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss 1 So in original. Probably should be ‘‘subsection (l)’’. section (m), subsection (g)(2)(A) shall be applied in a State, effective on and after the date speci- fied in subparagraph (B), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to the Model Regulation as amended by the Association in accordance with this paragraph (in this subsection and sub- section (l) referred to as the ‘‘amended NAIC Model Regulation’’). (B) The date specified in this subparagraph for a State is the earlier of the date the State adopts standards equal to or more stringent than the amended NAIC Model Regulation or 1 year after the date the Association first adopts such amended Regulation. (2)(A) If the Association does not amend the NAIC Model Regulation within the 90-day period specified in paragraph (1)(A), the Secretary shall promulgate, not later than 60 days after the end of such period, Federal model standards (in this subsection and subsection (1) 1 referred to as ‘‘Federal model standards’’) for medicare supple- mental policies to reflect the changes in law made by the Medicare Catastrophic Coverage Act of 1988, and subsection (g)(2)(A) shall be ap- plied in a State, effective on and after the date specified in subparagraph (B), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to Federal model standards. (B) The date specified in this subparagraph for a State is the earlier of the date the State adopts standards equal to or more stringent than the Federal model standards or 1 year after the date the Secretary first promulgates such standards. (3) Notwithstanding any other provision of this section (except as provided in subsections (l), (m), and (n))— (A) no medicare supplemental policy may be certified by the Secretary pursuant to sub- section (a), (B) no certification made pursuant to sub- section (a) shall remain in effect, and (C) no State regulatory program shall be found to meet (or to continue to meet) the re- quirements of subsection (b)(1)(A), unless such policy meets (or such program pro- vides for the application of standards equal to or more stringent than) the standards set forth in the amended NAIC Model Regulation or the Fed- eral model standards (as the case may be) by the date specified in paragraph (1)(B) or (2)(B) (as the case may be). (l) Transitional compliance with NAIC Model Transition Regulation; ‘‘qualifying medicare supplemental policy’’ and ‘‘NAIC Model Tran- sition Regulation’’ defined (1) Until the date specified in paragraph (3), in the case of a qualifying medicare supplemental policy described in paragraph (2) issued— (A) before January 1, 1989, the policy is deemed to remain in compliance with this sec- tion if the insurer issuing the policy complies with the NAIC Model Transition Regulation (including giving notices to subscribers and filing for premium adjustments with the State as described in section 5.B. of such Regulation) by January 1, 1989; or (B) on or after January 1, 1989, the policy is deemed to be in compliance with this section if the insurer issuing the policy complies with the NAIC Model Transition Regulation before the date of the sale of the policy. (2) In paragraph (1), the term ‘‘qualifying medicare supplemental policy’’ means a medi- care supplemental policy— (A) issued in a State which— (i) has not adopted standards equal to or more stringent than the NAIC Model Transi- tion Regulation by January 1, 1989, and (ii) has not adopted standards equal to or more stringent than the amended NAIC Model Regulation (or Federal model stand- ards) by January 1, 1989; and (B) which has been issued in compliance with this section (as in effect on June 1, 1988). (3)(A) The date specified in this paragraph is the earlier of— (i) the first date a State adopts, after Janu- ary 1, 1989, standards equal to or more strin- gent than the NAIC Model Transition Regula- tion or equal to or more stringent than the amended NAIC Model Regulation (or Federal model standards), as the case may be, or (ii) the later of (I) the date specified in sub- section (k)(1)(B) or (k)(2)(B) (as the case may be), or (II) the date specified in subparagraph (B). (B) In the case of a State which the Secretary identifies as— (i) requiring State legislation (other than legislation appropriating funds) in order for medicare supplemental policies to meet stand- ards described in subparagraph (A)(i), but (ii) having a legislature which is not sched- uled to meet in 1989 in a legislative session in which such legislation may be considered, the date specified in this subparagraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1989, and in which legislation de- scribed in clause (i) may be considered. For pur- poses of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a sep- arate regular session of the State legislature. (4) In the case of a medicare supplemental pol- icy in effect on January 1, 1989, and offered in a State which, as of such date— (A) has adopted standards equal to or more stringent than the amended NAIC Model Regu- lation (or Federal model standards), but (B) does not have in effect standards equal to or more stringent than the NAIC Model Transition Regulation (or otherwise requiring notice substantially the same as the notice re- quired in section 5.B. of such Regulation), the policy shall not be deemed to meet the standards in subsection (c) unless each indi- vidual who is entitled to benefits under this sub- chapter and is a policyholder under such policy on January 1, 1989, is sent such a notice in any appropriate form by not later than January 31, 1989, that explains— (A) the improved benefits under this sub- chapter contained in the Medicare Cata- strophic Coverage Act of 1988, and Page 3781 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss (B) how these improvements affect the bene- fits contained in the policies and the premium for the policy. (5) In this subsection, the term ‘‘NAIC Model Transition Regulation’’ refers to the standards contained in the ‘‘Model Regulation to Imple- ment Transitional Requirements for the Conver- sion of Medicare Supplement Insurance Benefits and Premiums to Conform to Medicare Program Revisions’’ (as adopted by the National Associa- tion of Insurance Commissioners in September 1987). (m) Revision of amended NAIC Model Regulation and amended Federal model standards; effec- tive dates; medicare supplemental policy and State regulatory program meeting applicable standards (1)(A) If, within the 90-day period beginning on December 13, 1989, the National Association of Insurance Commissioners (in this subsection and subsection (n) referred to as the ‘‘Association’’) revises the amended NAIC Model Regulation (re- ferred to in subsection (k)(1)(A) and adopted on September 20, 1988) to improve such regulation and otherwise to reflect the changes in law made by the Medicare Catastrophic Coverage Repeal Act of 1989, subsection (g)(2)(A) shall be applied in a State, effective on and after the date specified in subparagraph (B), as if the ref- erence to the Model Regulation adopted on June 6, 1979, were a reference to the amended NAIC Model Regulation (referred to in subsection (k)(1)(A)) as revised by the Association in ac- cordance with this paragraph (in this subsection and subsection (n) referred to as the ‘‘revised NAIC Model Regulation’’). (B) The date specified in this subparagraph for a State is the earlier of the date the State adopts standards equal to or more stringent than the revised NAIC Model Regulation or 1 year after the date the Association first adopts such revised Regulation. (2)(A) If the Association does not revise the amended NAIC Model Regulation, within the 90- day period specified in paragraph (1)(A), the Sec- retary shall promulgate, not later than 60 days after the end of such period, revised Federal model standards (in this subsection and sub- section (n) referred to as ‘‘revised Federal model standards’’) for medicare supplemental policies to improve such standards and otherwise to re- flect the changes in law made by the Medicare Catastrophic Coverage Repeal Act of 1989, sub- section (g)(2)(A) shall be applied in a State, ef- fective on and after the date specified in sub- paragraph (B), as if the reference to the Model Regulation adopted on June 6, 1979, were a ref- erence to the revised Federal model standards. (B) The date specified in this subparagraph for a State is the earlier of the date the State adopts standards equal to or more stringent than the revised Federal model standards or 1 year after the date the Secretary first promul- gates such standards. (3) Notwithstanding any other provision of this section (except as provided in subsection (n))— (A) no medicare supplemental policy may be certified by the Secretary pursuant to sub- section (a), (B) no certification made pursuant to sub- section (a) shall remain in effect, and (C) no State regulatory program shall be found to meet (or to continue to meet) the re- quirements of subsection (b)(1)(A), unless such policy meets (or such program pro- vides for the application of standards equal to or more stringent than) the standards set forth in the revised NAIC Model Regulation or the re- vised Federal model standards (as the case may be) by the date specified in paragraph (1)(B) or (2)(B) (as the case may be). (n) Transition compliance with revision of NAIC Model Regulation and Federal model stand- ards (1) Until the date specified in paragraph (4), in the case of a qualifying medicare supplemental policy described in paragraph (3) issued in a State— (A) before the transition deadline, the policy is deemed to remain in compliance with the standards described in subsection (b)(1)(A) only if the insurer issuing the policy complies with the transition provision described in paragraph (2), or (B) on or after the transition deadline, the policy is deemed to be in compliance with the standards described in subsection (b)(1)(A) only if the insurer issuing the policy complies with the revised NAIC Model Regulation or the revised Federal model standards (as the case may be) before the date of the sale of the policy. In this paragraph, the term ‘‘transition dead- line’’ means 1 year after the date the Associa- tion adopts the revised NAIC Model Regulation or 1 year after the date the Secretary promul- gates revised Federal model standards (as the case may be). (2) The transition provision described in this paragraph is— (A) such transition provision as the Associa- tion provides, by not later than December 15, 1989, so as to provide for an appropriate transi- tion (i) to restore benefit provisions which are no longer duplicative as a result of the changes in benefits under this subchapter made by the Medicare Catastrophic Coverage Repeal Act of 1989 and (ii) to eliminate the re- quirement of payment for the first 8 days of coinsurance for extended care services, or (B) if the Association does not provide for a transition provision by the date described in subparagraph (A), such transition provision as the Secretary shall provide, by January 1, 1990, so as to provide for an appropriate transi- tion described in subparagraph (A). (3) In paragraph (1), the term ‘‘qualifying medicare supplemental policy’’ means a medi- care supplemental policy which has been issued in compliance with this section as in effect on the date before December 13, 1989. (4)(A) The date specified in this paragraph for a policy issued in a State is— (i) the first date a State adopts, after De- cember 13, 1989, standards equal to or more stringent than the revised NAIC Model Regu- lation (or revised Federal model standards), as the case may be, or Page 3782 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss 2 So in original. Probably should be followed by a comma. (ii) the date specified in subparagraph (B), whichever is earlier. (B) In the case of a State which the Secretary identifies, in consultation with the Association, as— (i) requiring State legislation (other than legislation appropriating funds) in order for medicare supplemental policies to meet stand- ards described in subparagraph (A)(i), but (ii) having a legislature which is not sched- uled to meet in 1990 in a legislative session in which such legislation may be considered, the date specified in this subparagraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1990. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a separate regular session of the State legislature. (5) In the case of a medicare supplemental pol- icy in effect on January 1, 1990, the policy shall not be deemed to meet the standards in sub- section (c) unless each individual who is entitled to benefits under this subchapter and is a pol- icyholder or certificate holder under such policy on such date is sent a notice in an appropriate form by not later than January 31, 1990, that ex- plains— (A) the changes in benefits under this sub- chapter effected by the Medicare Catastrophic Coverage Repeal Act of 1989, and (B) how these changes may affect the bene- fits contained in such policy and the premium for the policy. (6)(A) Except as provided in subparagraph (B), in the case of an individual who had in effect, as of December 31, 1988, a medicare supplemental policy with an insurer (as a policyholder or, in the case of a group policy, as a certificate hold- er) and the individual terminated coverage under such policy before December 13, 1989, no medicare supplemental policy of the insurer shall be deemed to meet the standards in sub- section (c) unless the insurer— (i) provides written notice, no earlier than December 15, 1989, and no later than January 30, 1990, to the policyholder or certificate hold- er (at the most recent available address) of the offer described in clause (ii), and (ii) offers the individual, during a period of at least 60 days beginning not later than Feb- ruary 1, 1990, reinstitution of coverage (with coverage effective as of January 1, 1990), under the terms which (I) do not provide for any waiting period with respect to treatment of pre-existing conditions, (II) provides for cov- erage which is substantially equivalent to cov- erage in effect before the date of such termi- nation, and (III) provides for classification of premiums on which terms are at least as fa- vorable to the policyholder or certificate hold- er as the premium classification terms that would have applied to the policyholder or cer- tificate holder had the coverage never termi- nated. (B) An insurer is not required to make the offer under subparagraph (A)(ii) in the case of an individual who is a policyholder or certificate holder in another medicare supplemental policy as of December 13, 1989, if (as of January 1, 1990) the individual is not subject to a waiting period with respect to treatment of a pre-existing con- dition under such other policy. (o) Requirements of group benefits; core group benefits; uniform outline of coverage The requirements of this subsection are as fol- lows: (1) Each medicare supplemental policy shall provide for coverage of a group of benefits con- sistent with subsections (p), (v) 2 (w), and (y). (2) If the medicare supplemental policy pro- vides for coverage of a group of benefits other than the core group of basic benefits described in subsection (p)(2)(B), the issuer of the policy must make available to the individual a medi- care supplemental policy with only such core group of basic benefits. (3) The issuer of the policy has provided, be- fore the sale of the policy, an outline of cov- erage that uses uniform language and format (including layout and print size) that facili- tates comparison among medicare supple- mental policies and comparison with medicare benefits. (4) The issuer of the medicare supplemental policy complies with subsection (s)(2)(E) and subsection (x). (5) In addition to the requirement under paragraph (2), the issuer of the policy must make available to the individual at least Medicare supplemental policies with benefit packages classified as ‘‘C’’ or ‘‘F’’. (p) Standards for group benefits (1)(A) If, within 9 months after November 5, 1990, the National Association of Insurance Com- missioners (in this subsection referred to as the ‘‘Association’’) changes the revised NAIC Model Regulation (described in subsection (m)) to in- corporate— (i) limitations on the groups or packages of benefits that may be offered under a medicare supplemental policy consistent with para- graphs (2) and (3) of this subsection, (ii) uniform language and definitions to be used with respect to such benefits, (iii) uniform format to be used in the policy with respect to such benefits, and (iv) other standards to meet the additional requirements imposed by the amendments made by the Omnibus Budget Reconciliation Act of 1990, subsection (g)(2)(A) shall be applied in each State, effective for policies issued to policy- holders on and after the date specified in sub- paragraph (C), as if the reference to the Model Regulation adopted on June 6, 1979, were a ref- erence to the revised NAIC Model Regulation as changed under this subparagraph (such changed regulation referred to in this section as the ‘‘1991 NAIC Model Regulation’’). (B) If the Association does not make the changes in the revised NAIC Model Regulation within the 9-month period specified in subpara- graph (A), the Secretary shall promulgate, not Page 3783 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss later than 9 months after the end of such period, a regulation and subsection (g)(2)(A) shall be ap- plied in each State, effective for policies issued to policyholders on and after the date specified in subparagraph (C), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to the revised NAIC Model Regula- tion as changed by the Secretary under this sub- paragraph (such changed regulation referred to in this section as the ‘‘1991 Federal Regula- tion’’). (C)(i) Subject to clause (ii), the date specified in this subparagraph for a State is the date the State adopts the 1991 NAIC Model Regulation or 1991 Federal Regulation or 1 year after the date the Association or the Secretary first adopts such standards, whichever is earlier. (ii) In the case of a State which the Secretary identifies, in consultation with the Association, as— (I) requiring State legislation (other than legislation appropriating funds) in order for medicare supplemental policies to meet the 1991 NAIC Model Regulation or 1991 Federal Regulation, but (II) having a legislature which is not sched- uled to meet in 1992 in a legislative session in which such legislation may be considered, the date specified in this subparagraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1992. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a separate regular session of the State legislature. (D) In promulgating standards under this para- graph, the Association or Secretary shall con- sult with a working group composed of rep- resentatives of issuers of medicare supplemental policies, consumer groups, medicare bene- ficiaries, and other qualified individuals. Such representatives shall be selected in a manner so as to assure balanced representation among the interested groups. (E) If benefits (including deductibles and coin- surance) under this subchapter are changed and the Secretary determines, in consultation with the Association, that changes in the 1991 NAIC Model Regulation or 1991 Federal Regulation are needed to reflect such changes, the preceding provisions of this paragraph shall apply to the modification of standards previously established in the same manner as they applied to the origi- nal establishment of such standards. (2) The benefits under the 1991 NAIC Model Regulation or 1991 Federal Regulation shall pro- vide— (A) for such groups or packages of benefits as may be appropriate taking into account the considerations specified in paragraph (3) and the requirements of the succeeding subpara- graphs; (B) for identification of a core group of basic benefits common to all policies; and (C) that, subject to paragraph (4)(B), the total number of different benefit packages (counting the core group of basic benefits de- scribed in subparagraph (B) and each other combination of benefits that may be offered as a separate benefit package) that may be estab- lished in all the States and by all issuers shall not exceed 10 plus the 2 plans described in paragraph (11)(A). (3) The benefits under paragraph (2) shall, to the extent possible— (A) provide for benefits that offer consumers the ability to purchase the benefits that are available in the market as of November 5, 1990; and (B) balance the objectives of (i) simplifying the market to facilitate comparisons among policies, (ii) avoiding adverse selection, (iii) providing consumer choice, (iv) providing mar- ket stability, and (v) promoting competition. (4)(A)(i) Except as provided in subparagraph (B) or paragraph (6), no State with a regulatory program approved under subsection (b)(1) may provide for or permit the grouping of benefits (or language or format with respect to such ben- efits) under a medicare supplemental policy un- less such grouping meets the applicable 1991 NAIC Model Regulation or 1991 Federal Regula- tion. (ii) Except as provided in subparagraph (B), the Secretary may not provide for or permit the grouping of benefits (or language or format with respect to such benefits) under a medicare sup- plemental policy seeking approval by the Sec- retary unless such grouping meets the applica- ble 1991 NAIC Model Regulation or 1991 Federal Regulation. (B) With the approval of the State (in the case of a policy issued in a State with an approved regulatory program) or the Secretary (in the case of any other policy), the issuer of a medi- care supplemental policy may offer new or inno- vative benefits in addition to the benefits pro- vided in a policy that otherwise complies with the applicable 1991 NAIC Model Regulation or 1991 Federal Regulation. Any such new or inno- vative benefits may include benefits that are not otherwise available and are cost-effective and shall be offered in a manner which is con- sistent with the goal of simplification of medi- care supplemental policies. (5)(A) Except as provided in subparagraph (B), this subsection shall not be construed as pre- venting a State from restricting the groups of benefits that may be offered in medicare supple- mental policies in the State. (B) A State with a regulatory program ap- proved under subsection (b)(1) may not restrict under subparagraph (A) the offering of a medi- care supplemental policy consisting only of the core group of benefits described in paragraph (2)(B). (6) The Secretary may waive the application of standards described in clauses (i) through (iii) of paragraph (1)(A) in those States that on Novem- ber 5, 1990, had in place an alternative sim- plification program. (7) This subsection shall not be construed as preventing an issuer of a medicare supplemental policy who otherwise meets the requirements of this section from providing, through an arrange- ment with a vendor, for discounts from that ven- dor to policyholders or certificateholders for the purchase of items or services not covered under its medicare supplemental policies. Page 3784 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss 3 So in original. Probably should be ‘‘meet’’. 4 So in original. Probably should be preceded by ‘‘the’’. (8) Any person who sells or issues a medicare supplemental policy, on and after the effective date specified in paragraph (1)(C) (but subject to paragraph (10)), in violation of the applicable 1991 NAIC Model Regulation or 1991 Federal Reg- ulation insofar as such regulation relates to the requirements of subsection (o) or (q) or clause (i), (ii), or (iii) of paragraph (1)(A) is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a seller who is not an issuer of a policy) for each such violation. The provi- sions of section 1320a–7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1320a–7a(a) of this title. (9)(A) Anyone who sells a medicare supple- mental policy to an individual shall make avail- able for sale to the individual a medicare supple- mental policy with only the core group of basic benefits (described in paragraph (2)(B)). (B) Anyone who sells a medicare supplemental policy to an individual shall provide the indi- vidual, before the sale of the policy, an outline of coverage which describes the benefits under the policy. Such outline shall be on a standard form approved by the State regulatory program or the Secretary (as the case may be) consistent with the 1991 NAIC Model Regulation or 1991 Federal Regulation under this subsection. (C) Whoever sells a medicare supplemental policy in violation of this paragraph is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a seller who is not the issuer of the policy) for each such violation. The provisions of section 1320a–7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1320a–7a(a) of this title. (D) Subject to paragraph (10), this paragraph shall apply to sales of policies occurring on or after the effective date specified in paragraph (1)(C). (10) No penalty may be imposed under para- graph (8) or (9) in the case of a seller who is not the issuer of a policy until the Secretary has published a list of the groups of benefit packages that may be sold or issued consistent with para- graph (1)(A)(i). (11)(A) For purposes of paragraph (2), the ben- efit packages described in this subparagraph are as follows: (i) The benefit package classified as ‘‘F’’ under the standards established by such para- graph, except that it has a high deductible fea- ture. (ii) The benefit package classified as ‘‘J’’ under the standards established by such para- graph, except that it has a high deductible fea- ture. (B) For purposes of subparagraph (A), a high deductible feature is one which— (i) requires the beneficiary of the policy to pay annual out-of-pocket expenses (other than premiums) in the amount specified in subpara- graph (C) before the policy begins payment of benefits, and (ii) covers 100 percent of covered out-of- pocket expenses once such deductible has been satisfied in a year. (C) The amount specified in this subpara- graph— (i) for 1998 and 1999 is $1,500, and (ii) for a subsequent year, is the amount specified in this subparagraph for the previous year increased by the percentage increase in the Consumer Price Index for all urban con- sumers (all items; U.S. city average) for the 12-month period ending with August of the preceding year. If any amount determined under clause (ii) is not a multiple of $10, it shall be rounded to the nearest multiple of $10. (q) Guaranteed renewal of policies; termination; suspension The requirements of this subsection are as fol- lows: (1) Each medicare supplemental policy shall be guaranteed renewable and— (A) the issuer may not cancel or nonrenew the policy solely on the ground of health sta- tus of the individual; and (B) the issuer shall not cancel or nonrenew the policy for any reason other than non- payment of premium or material misrepre- sentation. (2) If the medicare supplemental policy is terminated by the group policyholder and is not replaced as provided under paragraph (4), the issuer shall offer certificateholders an in- dividual medicare supplemental policy which (at the option of the certificateholder)— (A) provides for continuation of the bene- fits contained in the group policy, or (B) provides for such benefits as otherwise meets 3 the requirements of this section. (3) If an individual is a certificateholder in a group medicare supplemental policy and the individual terminates membership in the group, the issuer shall— (A) offer the certificateholder the conver- sion opportunity described in paragraph (2), or (B) at the option of the group policyholder, offer the certificateholder continuation of coverage under the group policy. (4) If a group medicare supplemental policy is replaced by another group medicare supple- mental policy purchased by the same policy- holder, issuer 4 of the replacement policy shall offer coverage to all persons covered under the old group policy on its date of termination. Coverage under the new group policy shall not result in any exclusion for preexisting condi- tions that would have been covered under the group policy being replaced. (5)(A) Each medicare supplemental policy shall provide that benefits and premiums under the policy shall be suspended at the re- quest of the policyholder for the period (not to exceed 24 months) in which the policyholder has applied for and is determined to be enti- Page 3785 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss tled to medical assistance under subchapter XIX, but only if the policyholder notifies the issuer of such policy within 90 days after the date the individual becomes entitled to such assistance. If such suspension occurs and if the policyholder or certificate holder loses entitle- ment to such medical assistance, such policy shall be automatically reinstituted (effective as of the date of termination of such entitle- ment) under terms described in subsection (n)(6)(A)(ii) as of the termination of such enti- tlement if the policyholder provides notice of loss of such entitlement within 90 days after the date of such loss. (B) Nothing in this section shall be con- strued as affecting the authority of a State, under subchapter XIX, to purchase a medicare supplemental policy for an individual other- wise entitled to assistance under such sub- chapter. (C) Any person who issues a medicare sup- plemental policy and fails to comply with the requirements of this paragraph or paragraph (6) is subject to a civil money penalty of not to exceed $25,000 for each such violation. The pro- visions of section 1320a–7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sen- tence in the same manner as such provisions apply to a penalty or proceeding under section 1320a–7a(a) of this title. (6) Each medicare supplemental policy shall provide that benefits and premiums under the policy shall be suspended at the request of the policyholder if the policyholder is entitled to benefits under section 426(b) of this title and is covered under a group health plan (as defined in section 1395y(b)(1)(A)(v) of this title). If such suspension occurs and if the policyholder or certificate holder loses coverage under the group health plan, such policy shall be auto- matically reinstituted (effective as of the date of such loss of coverage) under terms described in subsection (n)(6)(A)(ii) as of the loss of such coverage if the policyholder provides notice of loss of such coverage within 90 days after the date of such loss. (r) Required ratio of aggregate benefits to aggre- gate premiums (1) A medicare supplemental policy may not be issued or renewed (or otherwise provide coverage after the date described in subsection (p)(1)(C)) in any State unless— (A) the policy can be expected for periods after the effective date of these provisions (as estimated for the entire period for which rates are computed to provide coverage, on the basis of incurred claims experience and earned pre- miums for such periods and in accordance with a uniform methodology, including uniform re- porting standards, developed by the National Association of Insurance Commissioners) to return to policyholders in the form of aggre- gate benefits provided under the policy, at least 75 percent of the aggregate amount of premiums collected in the case of group poli- cies and at least 65 percent in the case of indi- vidual policies; and (B) the issuer of the policy provides for the issuance of a proportional refund, or a credit against future premiums of a proportional amount, based on the premium paid and in ac- cordance with paragraph (2), of the amount of premiums received necessary to assure that the ratio of aggregate benefits provided to the aggregate premiums collected (net of such re- funds or credits) complies with the expecta- tion required under subparagraph (A), treating policies of the same type as a single policy for each standard package. For purposes of applying subparagraph (A) only, policies issued as a result of solicitations of in- dividuals through the mails or by mass media advertising (including both print and broadcast advertising) shall be deemed to be individual policies. For the purpose of calculating the re- fund or credit required under paragraph (1)(B) for a policy issued before the date specified in subsection (p)(1)(C), the refund or credit calcula- tion shall be based on the aggregate benefits provided and premiums collected under all such policies issued by an insurer in a State (sepa- rated as to individual and group policies) and shall be based only on aggregate benefits pro- vided and premiums collected under such poli- cies after the date specified in section 171(m)(4) of the Social Security Act Amendments of 1994. (2)(A) Paragraph (1)(B) shall be applied with respect to each type of policy by standard pack- age. Paragraph (1)(B) shall not apply to a policy until 12 months following issue. The Comp- troller General, in consultation with the Na- tional Association of Insurance Commissioners, shall submit to Congress a report containing recommendations on adjustments in the per- centages under paragraph (1)(A) that may be ap- propriate. In the case of a policy issued before the date specified in subsection (p)(1)(C), para- graph (1)(B) shall not apply until 1 year after the date specified in section 171(m)(4) of the So- cial Security Act Amendments of 1994. (B) A refund or credit required under para- graph (1)(B) shall be made to each policyholder insured under the applicable policy as of the last day of the year involved. (C) Such a refund or credit shall include inter- est from the end of the calendar year involved until the date of the refund or credit at a rate as specified by the Secretary for this purpose from time to time which is not less than the av- erage rate of interest for 13-week Treasury notes. (D) For purposes of this paragraph and para- graph (1)(B), refunds or credits against pre- miums due shall be made, with respect to a cal- endar year, not later than the third quarter of the succeeding calendar year. (3) The provisions of this subsection do not preempt a State from requiring a higher per- centage than that specified in paragraph (1)(A). (4) The Secretary shall submit in October of each year (beginning with 1993) a report to the Committees on Energy and Commerce and Ways and Means of the House of Representatives and the Committee on Finance of the Senate on loss ratios under medicare supplemental policies and the use of sanctions, such as a required rebate or credit or the disallowance of premium increases, for policies that fail to meet the requirements of this subsection (relating to loss ratios). Such re- port shall include a list of the policies that Page 3786 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss 5 See References in Text note below. failed to comply with such loss ratio require- ments or other requirements of this section. (5) The Secretary may perform audits with re- spect to the compliance of medicare supple- mental policies with the loss ratio requirements of this subsection and shall report the results of such audits to the State involved. (6)(A) A person who fails to provide refunds or credits as required in paragraph (1)(B) is subject to a civil money penalty of not to exceed $25,000 for each policy issued for which such failure oc- curred. The provisions of section 1320a–7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sen- tence in the same manner as such provisions apply to a penalty or proceeding under section 1320a–7a(a) of this title. (B) Each issuer of a policy subject to the re- quirements of paragraph (1)(B) shall be liable to the policyholder or, in the case of a group pol- icy, to the certificate holder for credits required under such paragraph. (s) Coverage for pre-existing conditions (1) If a medicare supplemental policy replaces another medicare supplemental policy, the issuer of the replacing policy shall waive any time periods applicable to preexisting condi- tions, waiting period, elimination periods and probationary periods in the new medicare sup- plemental policy for similar benefits to the ex- tent such time was spent under the original pol- icy. (2)(A) The issuer of a medicare supplemental policy may not deny or condition the issuance or effectiveness of a medicare supplemental pol- icy, or discriminate in the pricing of the policy, because of health status, claims experience, re- ceipt of health care, or medical condition in the case of an individual for whom an application is submitted prior to or during the 6 month period beginning with the first month as of the first day on which the individual is 65 years of age or older and is enrolled for benefits under part B. (B) Subject to subparagraphs (C) and (D), sub- paragraph (A) shall not be construed as pre- venting the exclusion of benefits under a policy, during its first 6 months, based on a pre-existing condition for which the policyholder received treatment or was otherwise diagnosed during the 6 months before the policy became effective. (C) If a medicare supplemental policy or cer- tificate replaces another such policy or certifi- cate which has been in effect for 6 months or longer, the replacing policy may not provide any time period applicable to pre-existing condi- tions, waiting periods, elimination periods, and probationary periods in the new policy or cer- tificate for similar benefits. (D) In the case of a policy issued during the 6- month period described in subparagraph (A) to an individual who is 65 years of age or older as of the date of issuance and who as of the date of the application for enrollment has a continuous period of creditable coverage (as defined in sec- tion 2701(c) 5 of the Public Health Service Act) of— (i) at least 6 months, the policy may not ex- clude benefits based on a pre-existing condi- tion; or (ii) less than 6 months, if the policy excludes benefits based on a preexisting condition, the policy shall reduce the period of any pre- existing condition exclusion by the aggregate of the periods of creditable coverage (if any, as so defined) applicable to the individual as of the enrollment date. The Secretary shall specify the manner of the reduction under clause (ii), based upon the rules used by the Secretary in carrying out section 2701(a)(3) of such Act. (E) An issuer of a medicare supplemental pol- icy shall not deny or condition the issuance or effectiveness of the policy (including the imposi- tion of any exclusion of benefits under the pol- icy based on a pre-existing condition) and shall not discriminate in the pricing of the policy (in- cluding the adjustment of premium rates) of an individual on the basis of the genetic informa- tion with respect to such individual. (F) RULE OF CONSTRUCTION.—Nothing in sub- paragraph (E) or in subparagraphs (A) or (B) of subsection (x)(2) shall be construed to limit the ability of an issuer of a medicare supplemental policy from, to the extent otherwise permitted under this subchapter— (i) denying or conditioning the issuance or effectiveness of the policy or increasing the premium for an employer based on the mani- festation of a disease or disorder of an indi- vidual who is covered under the policy; or (ii) increasing the premium for any policy issued to an individual based on the mani- festation of a disease or disorder of an indi- vidual who is covered under the policy (in such case, the manifestation of a disease or disorder in one individual cannot also be used as ge- netic information about other group members and to further increase the premium for the employer). (3)(A) The issuer of a medicare supplemental policy— (i) may not deny or condition the issuance or effectiveness of a medicare supplemental pol- icy described in subparagraph (C) that is of- fered and is available for issuance to new en- rollees by such issuer; (ii) may not discriminate in the pricing of such policy, because of health status, claims experience, receipt of health care, or medical condition; and (iii) may not impose an exclusion of benefits based on a preexisting condition under such policy, in the case of an individual described in subpara- graph (B) who seeks to enroll under the policy during the period specified in subparagraph (E) and who submits evidence of the date of termi- nation or disenrollment along with the applica- tion for such medicare supplemental policy. (B) An individual described in this subpara- graph is an individual described in any of the following clauses: (i) The individual is enrolled under an em- ployee welfare benefit plan that provides health benefits that supplement the benefits under this subchapter and the plan terminates or ceases to provide all such supplemental health benefits to the individual. (ii) The individual is enrolled with a Medicare+Choice organization under a Page 3787 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss Medicare+Choice plan under part C, and there are circumstances permitting discontinuance of the individual’s election of the plan under the first sentence of section 1395w–21(e)(4) of this title or the individual is 65 years of age or older and is enrolled with a PACE provider under section 1395eee of this title, and there are circumstances that would permit the dis- continuance of the individual’s enrollment with such provider under circumstances that are similar to the circumstances that would permit discontinuance of the individual’s elec- tion under the first sentence of such section if such individual were enrolled in a Medicare+Choice plan. (iii) The individual is enrolled with an eligi- ble organization under a contract under sec- tion 1395mm of this title, a similar organiza- tion operating under demonstration project authority, effective for periods before April 1, 1999, with an organization under an agreement under section 1395l(a)(1)(A) of this title, or with an organization under a policy described in subsection (t), and such enrollment ceases under the same circumstances that would per- mit discontinuance of an individual’s election of coverage under the first sentence of section 1395w–21(e)(4) of this title and, in the case of a policy described in subsection (t), there is no provision under applicable State law for the continuation or conversion of coverage under such policy. (iv) The individual is enrolled under a medi- care supplemental policy under this section and such enrollment ceases because— (I) of the bankruptcy or insolvency of the issuer or because of other involuntary termi- nation of coverage or enrollment under such policy and there is no provision under appli- cable State law for the continuation or con- version of such coverage; (II) the issuer of the policy substantially violated a material provision of the policy; or (III) the issuer (or an agent or other entity acting on the issuer’s behalf) materially misrepresented the policy’s provisions in marketing the policy to the individual. (v) The individual— (I) was enrolled under a medicare supple- mental policy under this section, (II) subsequently terminates such enroll- ment and enrolls, for the first time, with any Medicare+Choice organization under a Medicare+Choice plan under part C, any eli- gible organization under a contract under section 1395mm of this title, any similar or- ganization operating under demonstration project authority, any PACE provider under section 1395eee of this title, or any policy de- scribed in subsection (t), and (III) the subsequent enrollment under sub- clause (II) is terminated by the enrollee dur- ing any period within the first 12 months of such enrollment (during which the enrollee is permitted to terminate such subsequent enrollment under section 1395w–21(e) of this title). (vi) The individual, upon first becoming eli- gible for benefits under part A at age 65, en- rolls in a Medicare+ Choice plan under part C or in a PACE pro- gram under section 1395eee of this title, and disenrolls from such plan or such program by not later than 12 months after the effective date of such enrollment. (C)(i) Subject to clauses (ii) and (iii), a medi- care supplemental policy described in this sub- paragraph is a medicare supplemental policy which has a benefit package classified as ‘‘A’’, ‘‘B’’, ‘‘C’’, or ‘‘F’’ under the standards estab- lished under subsection (p)(2). (ii)(I) Subject to subclause (II), only for pur- poses of an individual described in subparagraph (B)(v), a medicare supplemental policy described in this subparagraph is the same medicare sup- plemental policy referred to in such subpara- graph in which the individual was most recently previously enrolled, if available from the same issuer, or, if not so available, a policy described in clause (i). (II) If the medicare supplemental policy re- ferred to in subparagraph (B)(v) was a medigap Rx policy (as defined in subsection (v)(6)(A)), a medicare supplemental policy described in this subparagraph is such policy in which the indi- vidual was most recently enrolled as modified under subsection (v)(2)(C)(i) or, at the election of the individual, a policy referred to in sub- section (v)(3)(A)(i). (iii) Only for purposes of an individual de- scribed in subparagraph (B)(vi) and subject to subsection (v)(1), a medicare supplemental pol- icy described in this subparagraph shall include any medicare supplemental policy. (iv) For purposes of applying this paragraph in the case of a State that provides for offering of benefit packages other than under the classifica- tion referred to in clause (i), the references to benefit packages in such clause are deemed ref- erences to comparable benefit packages offered in such State. (D) At the time of an event described in sub- paragraph (B) because of which an individual ceases enrollment or loses coverage or benefits under a contract or agreement, policy, or plan, the organization that offers the contract or agreement, the insurer offering the policy, or the administrator of the plan, respectively, shall notify the individual of the rights of the indi- vidual under this paragraph, and obligations of issuers of medicare supplemental policies, under subparagraph (A). (E) For purposes of subparagraph (A), the time period specified in this subparagraph is— (i) in the case of an individual described in subparagraph (B)(i), the period beginning on the date the individual receives a notice of termination or cessation of all supplemental health benefits (or, if no such notice is re- ceived, notice that a claim has been denied be- cause of such a termination or cessation) and ending on the date that is 63 days after the ap- plicable notice; (ii) in the case of an individual described in clause (ii), (iii), (v), or (vi) of subparagraph (B) whose enrollment is terminated involuntarily, the period beginning on the date that the indi- vidual receives a notice of termination and ending on the date that is 63 days after the date the applicable coverage is terminated; Page 3788 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss (iii) in the case of an individual described in subparagraph (B)(iv)(I), the period beginning on the earlier of (I) the date that the indi- vidual receives a notice of termination, a no- tice of the issuer’s bankruptcy or insolvency, or other such similar notice, if any, and (II) the date that the applicable coverage is termi- nated, and ending on the date that is 63 days after the date the coverage is terminated; (iv) in the case of an individual described in clause (ii), (iii), (iv)(II), (iv)(III), (v), or (vi) of subparagraph (B) who disenrolls voluntarily, the period beginning on the date that is 60 days before the effective date of the disenrollment and ending on the date that is 63 days after such effective date; and (v) in the case of an individual described in subparagraph (B) but not described in the pre- ceding provisions of this subparagraph, the pe- riod beginning on the effective date of the disenrollment and ending on the date that is 63 days after such effective date. (F)(i) Subject to clause (ii), for purposes of this paragraph— (I) in the case of an individual described in subparagraph (B)(v) (or deemed to be so de- scribed, pursuant to this subparagraph) whose enrollment with an organization or provider described in subclause (II) of such subpara- graph is involuntarily terminated within the first 12 months of such enrollment, and who, without an intervening enrollment, enrolls with another such organization or provider, such subsequent enrollment shall be deemed to be an initial enrollment described in such subparagraph; and (II) in the case of an individual described in clause (vi) of subparagraph (B) (or deemed to be so described, pursuant to this subpara- graph) whose enrollment with a plan or in a program described in such clause is involun- tarily terminated within the first 12 months of such enrollment, and who, without an inter- vening enrollment, enrolls in another such plan or program, such subsequent enrollment shall be deemed to be an initial enrollment de- scribed in such clause. (ii) For purposes of clauses (v) and (vi) of sub- paragraph (B), no enrollment of an individual with an organization or provider described in clause (v)(II), or with a plan or in a program de- scribed in clause (vi), may be deemed to be an initial enrollment under this clause after the 2- year period beginning on the date on which the individual first enrolled with such an organiza- tion, provider, plan, or program. (4) Any issuer of a medicare supplemental pol- icy that fails to meet the requirements of this subsection is subject to a civil money penalty of not to exceed $5,000 for each such failure. The provisions of section 1320a–7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1320a–7a(a) of this title. (t) Medicare select policies (1) If a medicare supplemental policy meets the 1991 NAIC Model Regulation or 1991 Federal Regulation and otherwise complies with the re- quirements of this section except that benefits under the policy are restricted to items and services furnished by certain entities (or re- duced benefits are provided when items or serv- ices are furnished by other entities), the policy shall nevertheless be treated as meeting those standards if— (A) full benefits are provided for items and services furnished through a network of enti- ties which have entered into contracts or agreements with the issuer of the policy; (B) full benefits are provided for items and services furnished by other entities if the serv- ices are medically necessary and immediately required because of an unforeseen illness, in- jury, or condition and it is not reasonable given the circumstances to obtain the services through the network; (C) the network offers sufficient access; (D) the issuer of the policy has arrangements for an ongoing quality assurance program for items and services furnished through the net- work; (E)(i) the issuer of the policy provides to each enrollee at the time of enrollment an ex- planation of (I) the restrictions on payment under the policy for services furnished other than by or through the network, (II) out of area coverage under the policy, (III) the pol- icy’s coverage of emergency services and ur- gently needed care, and (IV) the availability of a policy through the entity that meets the standards in the 1991 NAIC Model Regulation or 1991 Federal Regulation without reference to this subsection and the premium charged for such policy, and (ii) each enrollee prior to enrollment ac- knowledges receipt of the explanation pro- vided under clause (i); and (F) the issuer of the policy makes available to individuals, in addition to the policy de- scribed in this subsection, any policy (other- wise offered by the issuer to individuals in the State) that meets the standards in the 1991 NAIC Model Regulation or 1991 Federal Regu- lation and other requirements of this section without reference to this subsection. (2) If the Secretary determines that an issuer of a policy approved under paragraph (1)— (A) fails substantially to provide medically necessary items and services to enrollees seek- ing such items and services through the issuer’s network, if the failure has adversely affected (or has substantial likelihood of ad- versely affecting) the individual, (B) imposes premiums on enrollees in excess of the premiums approved by the State, (C) acts to expel an enrollee for reasons other than nonpayment of premiums, or (D) does not provide the explanation re- quired under paragraph (1)(E)(i) or does not obtain the acknowledgment required under paragraph (1)(E)(ii), the issuer is subject to a civil money penalty in an amount not to exceed $25,000 for each such violation. The provisions of section 1320a–7a of this title (other than the first sentence of sub- section (a) and other than subsection (b)) shall apply to a civil money penalty under the pre- Page 3789 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss vious sentence in the same manner as such pro- visions apply to a penalty or proceeding under section 1320a–7a(a) of this title. (3) The Secretary may enter into a contract with an entity whose policy has been certified under paragraph (1) or has been approved by a State under subsection (b)(1)(H) to determine whether items and services (furnished to indi- viduals entitled to benefits under this sub- chapter and under that policy) are not allowable under section 1395y(a)(1) of this title. Payments to the entity shall be in such amounts as the Secretary may determine, taking into account estimated savings under contracts with carriers and fiscal intermediaries and other factors that the Secretary finds appropriate. Paragraph (1), the first sentence of paragraph (2)(A), paragraph (2)(B), paragraph (3)(C), paragraph (3)(D), and paragraph (3)(E) 5 of section 1395u(b) of this title shall apply to the entity. (u) Additional rules relating to individuals en- rolled in MSA plans and in private fee-for- service plans (1) It is unlawful for a person to sell or issue a policy described in paragraph (2) to an indi- vidual with knowledge that the individual has in effect under section 1395w–21 of this title an election of an MSA plan or a Medicare+Choice private fee-for-service plan. (2)(A) A policy described in this subparagraph is a health insurance policy (other than a policy described in subparagraph (B)) that provides for coverage of expenses that are otherwise required to be counted toward meeting the annual de- ductible amount provided under the MSA plan. (B) A policy described in this subparagraph is any of the following: (i) A policy that provides coverage (whether through insurance or otherwise) for accidents, disability, dental care, vision care, or long- term care. (ii) A policy of insurance to which substan- tially all of the coverage relates to— (I) liabilities incurred under workers’ com- pensation laws, (II) tort liabilities, (III) liabilities relating to ownership or use of property, or (IV) such other similar liabilities as the Secretary may specify by regulations. (iii) A policy of insurance that provides cov- erage for a specified disease or illness. (iv) A policy of insurance that pays a fixed amount per day (or other period) of hos- pitalization. (v) Rules relating to medigap policies that pro- vide prescription drug coverage (1) Prohibition on sale, issuance, and renewal of new policies that provide prescription drug coverage (A) In general Notwithstanding any other provision of law, on or after January 1, 2006, a medigap Rx policy (as defined in paragraph (6)(A)) may not be sold, issued, or renewed under this section— (i) to an individual who is a part D en- rollee (as defined in paragraph (6)(B)); or (ii) except as provided in subparagraph (B), to an individual who is not a part D enrollee. (B) Continuation permitted for non-part D enrollees Subparagraph (A)(ii) shall not apply to the renewal of a medigap Rx policy that was issued before January 1, 2006. (C) Construction Nothing in this subsection shall be con- strued as preventing the offering on and after January 1, 2006, of ‘‘H’’, ‘‘I’’, and ‘‘J’’ policies described in paragraph (2)(D)(i) if the benefit packages are modified in accord- ance with paragraph (2)(C). (2) Elimination of duplicative coverage upon part D enrollment (A) In general In the case of an individual who is covered under a medigap Rx policy and enrolls under a part D plan— (i) before the end of the initial part D en- rollment period, the individual may— (I) enroll in a medicare supplemental policy without prescription drug cov- erage under paragraph (3); or (II) continue the policy in effect sub- ject to the modification described in sub- paragraph (C)(i); or (ii) after the end of such period, the indi- vidual may continue the policy in effect subject to such modification. (B) Notice required to be provided to current policyholders with medigap Rx policy No medicare supplemental policy of an issuer shall be deemed to meet the standards in subsection (c) unless the issuer provides written notice (in accordance with standards of the Secretary established in consultation with the National Association of Insurance Commissioners) during the 60-day period im- mediately preceding the initial part D en- rollment period, to each individual who is a policyholder or certificate holder of a medigap Rx policy (at the most recent avail- able address of that individual) of the fol- lowing: (i) If the individual enrolls in a plan under part D during the initial enrollment period under section 1395w–101(b)(2)(A) of this title, the individual has the option of— (I) continuing enrollment in the indi- vidual’s current plan, but the plan’s cov- erage of prescription drugs will be modi- fied under subparagraph (C)(i); or (II) enrolling in another medicare sup- plemental policy pursuant to paragraph (3). (ii) If the individual does not enroll in a plan under part D during such period, the individual may continue enrollment in the individual’s current plan without change, but— (I) the individual will not be guaran- teed the option of enrollment in another medicare supplemental policy pursuant to paragraph (3); and (II) if the current plan does not provide creditable prescription drug coverage (as Page 3790 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss defined in section 1395w–113(b)(4) of this title), notice of such fact and that there are limitations on the periods in a year in which the individual may enroll under a part D plan and any such enrollment is subject to a late enrollment penalty. (iii) Such other information as the Sec- retary may specify (in consultation with the National Association of Insurance Commissioners), including the potential impact of such election on premiums for medicare supplemental policies. (C) Modification (i) In general The policy modification described in this subparagraph is the elimination of pre- scription coverage for expenses of prescrip- tion drugs incurred after the effective date of the individual’s coverage under a part D plan and the appropriate adjustment of premiums to reflect such elimination of coverage. (ii) Continuation of renewability and appli- cation of modification No medicare supplemental policy of an issuer shall be deemed to meet the stand- ards in subsection (c) unless the issuer— (I) continues renewability of medigap Rx policies that it has issued, subject to subclause (II); and (II) applies the policy modification de- scribed in clause (i) in the cases de- scribed in clauses (i)(II) and (ii) of sub- paragraph (A). (D) References to Rx policies (i) H, I, and J policies Any reference to a benefit package clas- sified as ‘‘H’’, ‘‘I’’, or ‘‘J’’ (including the benefit package classified as ‘‘J’’ with a high deductible feature, as described in subsection (p)(11)) under the standards es- tablished under subsection (p)(2) shall be construed as including a reference to such a package as modified under subparagraph (C) and such packages as modified shall not be counted as a separate benefit pack- age under such subsection. (ii) Application in waivered States Except for the modification provided under subparagraph (C), the waivers pre- viously in effect under subsection (p)(2) shall continue in effect. (3) Availability of substitute policies with guar- anteed issue (A) In general The issuer of a medicare supplemental pol- icy— (i) may not deny or condition the issuance or effectiveness of a medicare supplemental policy that has a benefit package classified as ‘‘A’’, ‘‘B’’, ‘‘C’’, or ‘‘F’’ (including the benefit package classi- fied as ‘‘F’’ with a high deductible feature, as described in subsection (p)(11)), under the standards established under subsection (p)(2), or a benefit package described in subparagraph (A) or (B) of subsection (w)(2) and that is offered and is available for issuance to new enrollees by such issuer; (ii) may not discriminate in the pricing of such policy, because of health status, claims experience, receipt of health care, or medical condition; and (iii) may not impose an exclusion of ben- efits based on a pre-existing condition under such policy, in the case of an individual described in sub- paragraph (B) who seeks to enroll under the policy not later than 63 days after the effec- tive date of the individual’s coverage under a part D plan. (B) Individual covered An individual described in this subpara- graph with respect to the issuer of a medi- care supplemental policy is an individual who— (i) enrolls in a part D plan during the ini- tial part D enrollment period; (ii) at the time of such enrollment was enrolled in a medigap Rx policy issued by such issuer; and (iii) terminates enrollment in such pol- icy and submits evidence of such termi- nation along with the application for the policy under subparagraph (A). (C) Special rule for waivered States For purposes of applying this paragraph in the case of a State that provides for offering of benefit packages other than under the classification referred to in subparagraph (A)(i), the references to benefit packages in such subparagraph are deemed references to comparable benefit packages offered in such State. (4) Enforcement (A) Penalties for duplication The penalties described in subsection (d)(3)(A)(ii) shall apply with respect to a vio- lation of paragraph (1)(A). (B) Guaranteed issue The provisions of paragraph (4) of sub- section (s) shall apply with respect to the re- quirements of paragraph (3) in the same manner as they apply to the requirements of such subsection. (5) Construction Any provision in this section or in a medi- care supplemental policy relating to guaran- teed renewability of coverage shall be deemed to have been met with respect to a part D en- rollee through the continuation of the policy subject to modification under paragraph (2)(C) or the offering of a substitute policy under paragraph (3). The previous sentence shall not be construed to affect the guaranteed renew- ability of such a modified or substitute policy. (6) Definitions For purposes of this subsection: (A) Medigap Rx policy The term ‘‘medigap Rx policy’’ means a medicare supplemental policy— Page 3791 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss (i) which has a benefit package classified as ‘‘H’’, ‘‘I’’, or ‘‘J’’ (including the benefit package classified as ‘‘J’’ with a high de- ductible feature, as described in subsection (p)(11)) under the standards established under subsection (p)(2), without regard to this subsection; and (ii) to which such standards do not apply (or to which such standards have been waived under subsection (p)(6)) but which provides benefits for prescription drugs. Such term does not include a policy with a benefit package as classified under clause (i) which has been modified under paragraph (2)(C)(i). (B) Part D enrollee The term ‘‘part D enrollee’’ means an indi- vidual who is enrolled in a part D plan. (C) Part D plan The term ‘‘part D plan’’ means a prescrip- tion drug plan or an MA–PD plan (as defined for purposes of part D). (D) Initial part D enrollment period The term ‘‘initial part D enrollment pe- riod’’ means the initial enrollment period described in section 1395w–101(b)(2)(A) of this title. (w) Development of new standards for medicare supplemental policies (1) In general The Secretary shall request the National As- sociation of Insurance Commissioners to re- view and revise the standards for benefit pack- ages under subsection (p)(1), taking into ac- count the changes in benefits resulting from enactment of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 and to otherwise update standards to reflect other changes in law included in such Act. Such revision shall incorporate the inclusion of the 2 benefit packages described in para- graph (2). Such revisions shall be made con- sistent with the rules applicable under sub- section (p)(1)(E) with the reference to the ‘‘1991 NAIC Model Regulation’’ deemed a ref- erence to the NAIC Model Regulation as pub- lished in the Federal Register on December 4, 1998, and as subsequently updated by the Na- tional Association of Insurance Commis- sioners to reflect previous changes in law (and subsection (v)) and the reference to ‘‘date of enactment of this subsection’’ deemed a ref- erence to December 8, 2003. To the extent prac- ticable, such revision shall provide for the im- plementation of revised standards for benefit packages as of January 1, 2006. (2) New benefit packages The benefit packages described in this para- graph are the following (notwithstanding any other provision of this section relating to a core benefit package): (A) First new benefit package A benefit package consisting of the fol- lowing: (i) Subject to clause (ii), coverage of 50 percent of the cost-sharing otherwise ap- plicable under parts A and B, except there shall be no coverage of the part B deduct- ible and coverage of 100 percent of any cost-sharing otherwise applicable for pre- ventive benefits. (ii) Coverage for all hospital inpatient coinsurance and 365 extra lifetime days of coverage of inpatient hospital services (as in the current core benefit package). (iii) A limitation on annual out-of-pock- et expenditures under parts A and B to $4,000 in 2006 (or, in a subsequent year, to such limitation for the previous year in- creased by an appropriate inflation adjust- ment specified by the Secretary). (B) Second new benefit package A benefit package consisting of the benefit package described in subparagraph (A), ex- cept as follows: (i) Substitute ‘‘75 percent’’ for ‘‘50 per- cent’’ in clause (i) of such subparagraph. (ii) Substitute ‘‘$2,000’’ for ‘‘$4,000’’ in clause (iii) of such subparagraph. (x) Limitations on genetic testing and informa- tion (1) Genetic testing (A) Limitation on requesting or requiring ge- netic testing An issuer of a medicare supplemental pol- icy shall not request or require an individual or a family member of such individual to un- dergo a genetic test. (B) Rule of construction Subparagraph (A) shall not be construed to limit the authority of a health care profes- sional who is providing health care services to an individual to request that such indi- vidual undergo a genetic test. (C) Rule of construction regarding payment (i) In general Nothing in subparagraph (A) shall be construed to preclude an issuer of a medi- care supplemental policy from obtaining and using the results of a genetic test in making a determination regarding pay- ment (as such term is defined for the pur- poses of applying the regulations promul- gated by the Secretary under part C of subchapter XI and section 264 of the Health Insurance Portability and Account- ability Act of 1996, as may be revised from time to time) consistent with subsection (s)(2)(E). (ii) Limitation For purposes of clause (i), an issuer of a medicare supplemental policy may request only the minimum amount of information necessary to accomplish the intended pur- pose. (D) Research exception Notwithstanding subparagraph (A), an issuer of a medicare supplemental policy may request, but not require, that an indi- vidual or a family member of such individual undergo a genetic test if each of the fol- lowing conditions is met: Page 3792 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss (i) The request is made pursuant to re- search that complies with part 46 of title 45, Code of Federal Regulations, or equiva- lent Federal regulations, and any applica- ble State or local law or regulations for the protection of human subjects in re- search. (ii) The issuer clearly indicates to each individual, or in the case of a minor child, to the legal guardian of such child, to whom the request is made that— (I) compliance with the request is vol- untary; and (II) non-compliance will have no effect on enrollment status or premium or con- tribution amounts. (iii) No genetic information collected or acquired under this subparagraph shall be used for underwriting, determination of eligibility to enroll or maintain enroll- ment status, premium rating, or the cre- ation, renewal, or replacement of a plan, contract, or coverage for health insurance or health benefits. (iv) The issuer notifies the Secretary in writing that the issuer is conducting ac- tivities pursuant to the exception provided for under this subparagraph, including a description of the activities conducted. (v) The issuer complies with such other conditions as the Secretary may by regu- lation require for activities conducted under this subparagraph. (2) Prohibition on collection of genetic infor- mation (A) In general An issuer of a medicare supplemental pol- icy shall not request, require, or purchase genetic information for underwriting pur- poses (as defined in paragraph (3)). (B) Prohibition on collection of genetic infor- mation prior to enrollment An issuer of a medicare supplemental pol- icy shall not request, require, or purchase genetic information with respect to any in- dividual prior to such individual’s enroll- ment under the policy in connection with such enrollment. (C) Incidental collection If an issuer of a medicare supplemental policy obtains genetic information inci- dental to the requesting, requiring, or pur- chasing of other information concerning any individual, such request, requirement, or purchase shall not be considered a violation of subparagraph (B) if such request, require- ment, or purchase is not in violation of sub- paragraph (A). (3) Definitions In this subsection: (A) Family member The term ‘‘family member’’ means with re- spect to an individual, any other individual who is a first-degree, second-degree, third- degree, or fourth-degree relative of such in- dividual. (B) Genetic information (i) In general The term ‘‘genetic information’’ means, with respect to any individual, informa- tion about— (I) such individual’s genetic tests, (II) the genetic tests of family mem- bers of such individual, and (III) subject to clause (iv), the mani- festation of a disease or disorder in fam- ily members of such individual. (ii) Inclusion of genetic services and par- ticipation in genetic research Such term includes, with respect to any individual, any request for, or receipt of, genetic services, or participation in clin- ical research which includes genetic serv- ices, by such individual or any family member of such individual. (iii) Exclusions The term ‘‘genetic information’’ shall not include information about the sex or age of any individual. (C) Genetic test (i) In general The term ‘‘genetic test’’ means an anal- ysis of human DNA, RNA, chromosomes, proteins, or metabolites, that detects genotypes, mutations, or chromosomal changes. (ii) Exceptions The term ‘‘genetic test’’ does not mean— (I) an analysis of proteins or metabo- lites that does not detect genotypes, mutations, or chromosomal changes; or (II) an analysis of proteins or metabo- lites that is directly related to a mani- fested disease, disorder, or pathological condition that could reasonably be de- tected by a health care professional with appropriate training and expertise in the field of medicine involved. (D) Genetic services The term ‘‘genetic services’’ means— (i) a genetic test; (ii) genetic counseling (including obtain- ing, interpreting, or assessing genetic in- formation); or (iii) genetic education. (E) Underwriting purposes The term ‘‘underwriting purposes’’ means, with respect to a medicare supplemental pol- icy— (i) rules for, or determination of, eligi- bility (including enrollment and continued eligibility) for benefits under the policy; (ii) the computation of premium or con- tribution amounts under the policy; (iii) the application of any pre-existing condition exclusion under the policy; and (iv) other activities related to the cre- ation, renewal, or replacement of a con- tract of health insurance or health bene- fits. (F) Issuer of a medicare supplemental policy The term ‘‘issuer of a medicare supple- mental policy’’ includes a third-party ad- Page 3793 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss ministrator or other person acting for or on behalf of such issuer. (4) Genetic information of a fetus or embryo Any reference in this section to genetic in- formation concerning an individual or family member of an individual shall— (A) with respect to such an individual or family member of an individual who is a pregnant woman, include genetic informa- tion of any fetus carried by such pregnant woman; and (B) with respect to an individual or family member utilizing an assisted reproductive technology, include genetic information of any embryo legally held by the individual or family member. (y) Development of new standards for certain medicare supplemental policies (1) In general The Secretary shall request the National As- sociation of Insurance Commissioners to re- view and revise the standards for benefit pack- ages described in paragraph (2) under sub- section (p)(1), to otherwise update standards to include requirements for nominal cost shar- ing to encourage the use of appropriate physi- cians’ services under part B. Such revisions shall be based on evidence published in peer- reviewed journals or current examples used by integrated delivery systems and made con- sistent with the rules applicable under sub- section (p)(1)(E) with the reference to the ‘‘1991 NAIC Model Regulation’’ deemed a ref- erence to the NAIC Model Regulation as pub- lished in the Federal Register on December 4, 1998, and as subsequently updated by the Na- tional Association of Insurance Commis- sioners to reflect previous changes in law and the reference to ‘‘date of enactment of this subsection’’ deemed a reference to March 23, 2010. To the extent practicable, such revision shall provide for the implementation of re- vised standards for benefit packages as of Jan- uary 1, 2015. (2) Benefit packages described The benefit packages described in this para- graph are benefit packages classified as ‘‘C’’ and ‘‘F’’. (z) Limitation on certain medigap policies for newly eligible Medicare beneficiaries (1) In general Notwithstanding any other provision of this section, on or after January 1, 2020, a medicare supplemental policy that provides coverage of the part B deductible, including any such pol- icy (or rider to such a policy) issued under a waiver granted under subsection (p)(6), may not be sold or issued to a newly eligible Medi- care beneficiary. (2) Newly eligible Medicare beneficiary defined In this subsection, the term ‘‘newly eligible Medicare beneficiary’’ means an individual who is neither of the following: (A) An individual who has attained age 65 before January 1, 2020. (B) An individual who was entitled to ben- efits under part A pursuant to section 426(b) or 426–1 of this title, or deemed to be eligible for benefits under section 426(a) of this title, before January 1, 2020. (3) Treatment of waivered States In the case of a State described in subsection (p)(6), nothing in this section shall be con- strued as preventing the State from modifying its alternative simplification program under such subsection so as to eliminate the cov- erage of the part B deductible for any medical supplemental policy sold or issued under such program to a newly eligible Medicare bene- ficiary on or after January 1, 2020. (4) Treatment of references to certain policies In the case of a newly eligible Medicare ben- eficiary, except as the Secretary may other- wise provide, any reference in this section to a medicare supplemental policy which has a benefit package classified as ‘‘C’’ or ‘‘F’’ shall be deemed, as of January 1, 2020, to be a ref- erence to a medicare supplemental policy which has a benefit package classified as ‘‘D’’ or ‘‘G’’, respectively. (5) Enforcement The penalties described in clause (ii) of sub- section (d)(3)(A) shall apply with respect to a violation of paragraph (1) in the same manner as it applies to a violation of clause (i) of such subsection. (Aug. 14, 1935, ch. 531, title XVIII, § 1882, as added Pub. L. 96–265, title V, § 507(a), June 9, 1980, 94 Stat. 476; amended H. Res. 549, Mar. 25, 1980; Pub. L. 100–93, § 13, Aug. 18, 1987, 101 Stat. 697; Pub. L. 100–203, title IV, § 4081(b), Dec. 22, 1987, 101 Stat. 1330–127; Pub. L. 100–360, title II, § 221(a)–(f), title IV, §§ 411(i)(1)(B), (C), 428(b), July 1, 1988, 102 Stat. 742–746, 788, 817; Pub. L. 101–234, title II, § 203(a)(1), Dec. 13, 1989, 103 Stat. 1982; Pub. L. 101–508, title IV, §§ 4207(k)(1), formerly 4027(k)(1), 4351, formerly 4351(a), 4352, 4353(a)–(d)(1), 4354(a), (b), 4355(a)–(c), 4356(a), 4357(a), 4358(a), (b)(1), (2), Nov. 5, 1990, 104 Stat. 1388–124, 1388–125, 1388–129, 1388–130, 1388–132, 1388–134 to 1388–137; Pub. L. 103–432, title I, §§ 160(d)(4), 171(a)–(d)(3)(B), (4), (e)(1), (2), (f)(1), (g), (h)(1), (j)(2), (k), Oct. 31, 1994, 108 Stat. 4444–4451; Pub. L. 104–191, title II, § 271(a), (b), Aug. 21, 1996, 110 Stat. 2034–2036; Pub. L. 105–33, title IV, §§ 4002(j)(2), 4003, 4031(a)–(c), 4032(a), Aug. 5, 1997, 111 Stat. 330, 355, 357, 359; Pub. L. 105–362, title VI, § 601(b)(6), Nov. 10, 1998, 112 Stat. 3286; Pub. L. 106–113, div. B, § 1000(a)(6) [title III, § 321(k)(13), (14), title V, §§ 501(a)(2), 536(a)], Nov. 29, 1999, 113 Stat. 1536, 1501A–368, 1501A–378, 1501A–390; Pub. L. 106–170, title II, § 205(a), Dec. 17, 1999, 113 Stat. 1899; Pub. L. 106–554, § 1(a)(6) [title VI, § 618], Dec. 21, 2000, 114 Stat. 2763, 2763A–562; Pub. L. 108–173, title I, § 104(a), (b), title VII, § 736(e), Dec. 8, 2003, 117 Stat. 2161, 2164, 2357; Pub. L. 110–161, div. H, title I, § 1502(f), Dec. 26, 2007, 121 Stat. 2250; Pub. L. 110–233, title I, § 104(a), (b), May 21, 2008, 122 Stat. 899, 900; Pub. L. 110–275, title I, § 104(b), July 15, 2008, 122 Stat. 2502; Pub. L. 111–148, title III, § 3210, Mar. 23, 2010, 124 Stat. 460; Pub. L. 114–10, title IV, § 401, Apr. 16, 2015, 129 Stat. 159.) Page 3794 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss Editorial Notes REFERENCES IN TEXT Section 171(m) of the Social Security Act Amend- ments of 1994, referred to in subsecs. (d)(3)(A)(vi)(IV) and (r)(1), (2)(A), is section 171(m) of Pub. L. 103–432, title I, Oct. 31, 1994, 108 Stat. 4452, which is set out as a note below. Section 603(c) of the Social Security Amendments of 1983, referred to in subsec. (g)(1), is section 603(c) of Pub. L. 98–21, title VI, Apr. 20, 1983, 97 Stat. 168, which was not classified to the Code, and was repealed by Pub. L. 105–33, title IV, § 4803(d), Aug. 5, 1997, 111 Stat. 550, subject to transition provisions. Section 2355 of the Deficit Reduction Act of 1984, re- ferred to in subsec. (g)(1), is section 2355 of Pub. L. 98–369, div. B, title III, July 18, 1984, 98 Stat. 1103, which is not classified to the Code. Section 9412(b) of the Omnibus Budget Reconciliation Act of 1986, referred to in subsec. (g)(1), is section 9412(b) of Pub. L. 99–509, title IX, Oct. 21, 1986, 100 Stat. 2062, which was not classified to the Code, and was re- pealed by Pub. L. 105–33, title IV, § 4803(d), Aug. 5, 1997, 111 Stat. 550, subject to transition provisions. The Medicare Catastrophic Coverage Act of 1988, re- ferred to in subsecs. (k)(1)(A), (2)(A) and (l)(4)(A), is Pub. L. 100–360, July 1, 1988, 102 Stat. 683. For complete classification of this Act to the Code, see Short Title of 1988 Amendment note set out under section 1305 of this title and Tables. The Medicare Catastrophic Coverage Repeal Act of 1989, referred to in subsecs. (m)(1)(A), (2)(A) and (n)(2)(A), (5)(A), is Pub. L. 101–234, Dec. 13, 1989, 103 Stat. 1979. For complete classification of this Act to the Code, see Short Title of 1989 Amendment note set out under section 1305 of this title and Tables. The Omnibus Budget Reconciliation Act of 1990, re- ferred to in subsec. (p)(1)(A)(iv), is Pub. L. 101–508, Nov. 5, 1990, 104 Stat. 1388. For complete classification of this Act to the Code, see Tables. Section 2701 of the Public Health Service Act, re- ferred to in subsec. (s)(2)(D), is section 2701 of act July 1, 1944, which was classified to section 300gg of this title, was renumbered section 2704, effective for plan years beginning on or after Jan. 1, 2014, with certain ex- ceptions, and amended, by Pub. L. 111–148, title I, §§ 1201(2), 1563(c)(1), formerly § 1562(c)(1), title X, § 10107(b)(1), Mar. 23, 2010, 124 Stat. 154, 264, 911, and was transferred to section 300gg–3 of this title. A new sec- tion 2701 of act July 1, 1944, related to fair health insur- ance premiums, was added, effective for plan years be- ginning on or after Jan. 1, 2014, and amended, by Pub. L. 111–148, title I, § 1201(4), title X, § 10103(a), Mar. 23, 2010, 124 Stat. 155, 892, and is classified to section 300gg of this title. Paragraphs (2)(A), (B) and (3)(C)–(E) of section 1395u(b) of this title, referred to in subsec. (t)(3), were repealed by Pub. L. 108–173, title IX, § 911(c)(3)(B)(i), (C)(iv), Dec. 8, 2003, 117 Stat. 2384. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003, referred to in subsec. (w)(1), is Pub. L. 108–173, Dec. 8, 2003, 117 Stat. 2066. For com- plete classification of this Act to the Code, see Short Title of 2003 Amendment note set out under section 1305 of this title and Tables. Section 264 of the Health Insurance Portability and Accountability Act of 1996, referred to in subsec. (x)(1)(C)(i), is section 264 of Pub. L. 104–191, which is set out as a note under section 1320d–2 of this title. AMENDMENTS 2015—Subsec. (z). Pub. L. 114–10 added subsec. (z). 2010—Subsec. (o)(1). Pub. L. 111–148, § 3210(b), sub- stituted ‘‘(w), and (y)’’ for ‘‘, and (w)’’. Subsec. (y). Pub. L. 111–148, § 3210(a), added subsec. (y). 2008—Subsec. (o)(4). Pub. L. 110–233, § 104(b)(3), added par. (4). Subsec. (o)(5). Pub. L. 110–275 added par. (5). Subsec. (s)(2)(E), (F). Pub. L. 110–233, § 104(a), added subpars. (E) and (F). Subsec. (x). Pub. L. 110–233, § 104(b)(1), added subsec. (x). Subsec. (x)(4). Pub. L. 110–233, § 104(b)(2), added par. (4). 2007—Subsec. (r)(5). Pub. L. 110–161 substituted ‘‘The Secretary may’’ for ‘‘(A) The Comptroller General shall periodically, not less often than once every 3 years,’’ and struck out ‘‘and to the Secretary’’ after ‘‘State in- volved’’ and subpar. (B) which read as follows: ‘‘The Secretary may independently perform such compliance audits.’’ 2003—Subsec. (d)(3)(A)(i)(II). Pub. L. 108–173, § 736(e)(1), substituted ‘‘plan, a medicare supplemental policy’’ for ‘‘plan a medicare supplemental policy’’. Subsec. (d)(3)(B)(iii)(II). Pub. L. 108–173, § 736(e)(2), substituted ‘‘to the best of the issuer’s or seller’s knowledge’’ for ‘‘to the best of the issuer or seller’s knowledge’’. Subsec. (g)(1). Pub. L. 108–173, § 104(b)(2)(A), inserted ‘‘a prescription drug plan under part D or’’ after ‘‘but does not include’’. Subsec. (g)(2)(A). Pub. L. 108–173, § 736(e)(3), sub- stituted ‘‘medicare supplemental policies’’ for ‘‘medi- care supplement policies’’. Subsec. (o)(1). Pub. L. 108–173, § 104(b)(2)(B), sub- stituted ‘‘subsections (p), (v), and (w)’’ for ‘‘subsection (p)’’. Subsec. (p)(2)(B). Pub. L. 108–173, § 736(e)(4), sub- stituted ‘‘; and’’ for ‘‘, and’’ at end. Subsec. (s)(3)(A)(iii). Pub. L. 108–173, § 736(e)(5), sub- stituted ‘‘preexisting’’ for ‘‘pre-existing’’. Subsec. (s)(3)(C)(ii). Pub. L. 108–173, § 104(a)(2)(A), des- ignated existing provisions as subcl. (I), substituted ‘‘Subject to subclause (II), only’’ for ‘‘Only’’, and added subcl. (II). Subsec. (s)(3)(C)(iii). Pub. L. 108–173, § 104(a)(2)(B), in- serted ‘‘and subject to subsection (v)(1)’’ after ‘‘sub- paragraph (B)(vi)’’. Subsec. (v). Pub. L. 108–173, § 104(a)(1), added subsec. (v). Subsec. (w). Pub. L. 108–173, § 104(b)(1), added subsec. (w). 2000—Subsec. (s)(3)(A). Pub. L. 106–554, § 1(a)(6) [title VI, § 618(a)(1)], in concluding provisions, substituted ‘‘seeks to enroll under the policy during the period specified in subparagraph (E)’’ for ‘‘, subject to sub- paragraph (E), seeks to enroll under the policy not later than 63 days after the date of the termination of enrollment described in such subparagraph’’. Subsec. (s)(3)(E). Pub. L. 106–554, § 1(a)(6) [title VI, § 618(a)(2)], added subpar. (E) and struck out former sub- par. (E) which read as follows: ‘‘(E)(i) An individual described in subparagraph (B)(ii) may elect to apply subparagraph (A) by substituting, for the date of termination of enrollment, the date on which the individual was notified by the Medicare+Choice organization of the impending termi- nation or discontinuance of the Medicare+Choice plan it offers in the area in which the individual resides, but only if the individual disenrolls from the plan as a re- sult of such notification. ‘‘(ii) In the case of an individual making such an elec- tion, the issuer involved shall accept the application of the individual submitted before the date of termination of enrollment, but the coverage under subparagraph (A) shall only become effective upon termination of cov- erage under the Medicare+Choice plan involved.’’ Subsec. (s)(3)(F). Pub. L. 106–554, § 1(a)(6) [title VI, § 618(b)], added subpar. (F). 1999—Subsec. (g)(1). Pub. L. 106–113, § 1000(a)(6) [title III, § 321(k)(13)], struck out ‘‘or’’ after ‘‘; but does not include’’. Subsec. (q)(5)(C). Pub. L. 106–170, § 205(a)(1), inserted ‘‘or paragraph (6)’’ after ‘‘this paragraph’’. Subsec. (q)(6). Pub. L. 106–170, § 205(a)(2), added par. (6). Subsec. (s)(2)(D). Pub. L. 106–113, § 1000(a)(6) [title III, § 321(k)(14)], inserted ‘‘section’’ after ‘‘(as defined in’’ in introductory provisions. Page 3795 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss Subsec. (s)(3)(A). Pub. L. 106–113, § 1000(a)(6) [title V, § 501(a)(2)(A)], inserted ‘‘, subject to subparagraph (E),’’ after ‘‘in the case of an individual described in subpara- graph (B) who’’ in concluding provisions. Subsec. (s)(3)(B)(ii). Pub. L. 106–113, § 1000(a)(6) [title V, § 536(a)(1)], inserted before period at end ‘‘or the indi- vidual is 65 years of age or older and is enrolled with a PACE provider under section 1395eee of this title, and there are circumstances that would permit the dis- continuance of the individual’s enrollment with such provider under circumstances that are similar to the circumstances that would permit discontinuance of the individual’s election under the first sentence of such section if such individual were enrolled in a Medicare+Choice plan’’. Subsec. (s)(3)(B)(v)(II). Pub. L. 106–113, § 1000(a)(6) [title V, § 536(a)(2)], inserted ‘‘any PACE provider under section 1395eee of this title,’’ after ‘‘demonstration project authority,’’. Subsec. (s)(3)(B)(vi). Pub. L. 106–113, § 1000(a)(6) [title V, § 536(a)(3)], inserted ‘‘or in a PACE program under section 1395eee of this title’’ after ‘‘part C’’ and sub- stituted ‘‘such plan or such program’’ for ‘‘such plan’’. Subsec. (s)(3)(E). Pub. L. 106–113, § 1000(a)(6) [title V, § 501(a)(2)(B)], added subpar. (E). 1998—Subsec. (l)(6). Pub. L. 105–362 struck out par. (6) which read as follows: ‘‘The Secretary shall report to the Congress in March 1989 and in July 1990 on actions States have taken in adopting standards equal to or more stringent than the NAIC Model Transition Regu- lation or the amended NAIC Model Regulation (or Fed- eral model standards).’’ 1997—Subsec. (d)(3)(A)(i). Pub. L. 105–33, § 4003(a)(1)(A), inserted ‘‘(including an individual electing a Medicare+Choice plan under section 1395w–21 of this title)’’ after ‘‘part B of this subchapter’’ in introduc- tory provisions. Subsec. (d)(3)(A)(i)(II). Pub. L. 105–33, § 4003(a)(1)(B), inserted ‘‘in the case of an individual not electing a Medicare+Choice plan’’ after ‘‘(II)’’ and inserted ‘‘or in the case of an individual electing a Medicare+Choice plan, a medicare supplemental policy with knowledge that the policy duplicates health benefits to which the individual is otherwise entitled under the Medicare+ Choice plan or under another medicare supplemental policy’’ before comma at end. Subsec. (d)(3)(A)(vi)(III). Pub. L. 105–33, § 4031(c), in- serted ‘‘, a policy described in clause (v),’’ after ‘‘Medi- care supplemental policy’’. Subsec. (d)(3)(B)(i)(I). Pub. L. 105–33, § 4003(a)(2), in- serted ‘‘(including any Medicare+Choice plan)’’ after ‘‘health insurance policies’’. Subsec. (g)(1). Pub. L. 105–33, § 4003(a)(3), inserted ‘‘or a Medicare+Choice plan or’’ after ‘‘does not include’’ the first place appearing. Pub. L. 105–33, § 4002(j)(2), struck out ‘‘, during the pe- riod beginning on the date specified in subsection (p)(1)(C) of this section and ending on December 31, 1995,’’ after ‘‘Omnibus Budget Reconciliation Act of 1986, or’’. Subsec. (p)(2)(C). Pub. L. 105–33, § 4032(a)(1), inserted before period at end ‘‘plus the 2 plans described in para- graph (11)(A)’’. Subsec. (p)(11). Pub. L. 105–33, § 4032(a)(2), added par. (11). Subsec. (s)(2)(B). Pub. L. 105–33, § 4031(b)(1), sub- stituted ‘‘subparagraphs (C) and (D)’’ for ‘‘subparagraph (C)’’. Subsec. (s)(2)(D). Pub. L. 105–33, § 4031(b)(2), added sub- par. (D). Subsec. (s)(3). Pub. L. 105–33, § 4031(a)(3), added par. (3). Former par. (3) redesignated (4). Pub. L. 105–33, § 4031(a)(1), (2), substituted ‘‘require- ments of this subsection’’ for ‘‘requirements of para- graphs (1) and (2)’’ and redesignated par. (3) as (4). Subsec. (s)(4). Pub. L. 105–33, § 4031(a)(2), redesignated par. (3) as (4). Subsec. (u). Pub. L. 105–33, § 4003(b), added subsec. (u). 1996—Subsec. (d)(3)(A)(iii). Pub. L. 104–191, § 271(a)(1), substituted ‘‘clause (i)(II)’’ for ‘‘clause (i)’’. Subsec. (d)(3)(A)(iv) to (viii). Pub. L. 104–191, § 271(a)(2), added cls. (iv) to (viii). Subsec. (d)(3)(C). Pub. L. 104–191, § 271(b)(1), sub- stituted ‘‘with respect to’’ for ‘‘with respect to (i)’’ and struck out before period at end ‘‘, (ii) the sale or issuance of a policy or plan described in subparagraph (A)(i)(I) (other than a medicare supplemental policy to an individual entitled to any medical assistance under subchapter XIX of this chapter) under which all the benefits are fully payable directly to or on behalf of the individual without regard to other health benefit cov- erage of the individual but only if (for policies sold or issued more than 60 days after the date the statements are published or promulgated under subparagraph (D)) there is disclosed in a prominent manner as part of (or together with) the application the applicable statement (specified under subparagraph (D)) of the extent to which benefits payable under the policy or plan dupli- cate benefits under this subchapter, or (iii) the sale or issuance of a policy or plan described in subparagraph (A)(i)(III) under which all the benefits are fully payable directly to or on behalf of the individual without re- gard to other health benefit coverage of the indi- vidual’’. Subsec. (d)(3)(D). Pub. L. 104–191, § 271(b)(2), struck out subpar. (D) which provided for development of statements for various types of health insurance poli- cies sold or issued to persons entitled to health benefits under this subchapter regarding extent to which bene- fits payable under those policies duplicate benefits under this subchapter. 1994—Subsec. (a)(2). Pub. L. 103–432, § 171(c)(1)(B), in closing provisions substituted ‘‘on and after the effec- tive date specified in subsection (p)(1)(C)’’ for ‘‘after the effective date of the NAIC or Federal standards with respect to the policy’’. Subsec. (a)(2)(A). Pub. L. 103–432, § 171(c)(1)(A), sub- stituted ‘‘1991 NAIC Model Regulation or 1991 Federal Regulation’’ for ‘‘NAIC standards or the Federal stand- ards’’. Subsec. (b)(1). Pub. L. 103–432, § 171(e)(2), substituted ‘‘subparagraph (F)’’ for ‘‘subsection (F)’’ in last sen- tence. Pub. L. 103–432, § 171(c)(4), substituted ‘‘the Secretary determines’’ for ‘‘the the Secretary determines’’ in in- troductory provisions. Pub. L. 103–432, § 171(c)(2), in last sentence substituted ‘‘Each report’’ for ‘‘The report’’, ‘‘fail to meet the standards and requirements’’ for ‘‘fail to meet the standards’’, ‘‘compliance, information regarding’’ for ‘‘compliance, and information regarding’’, and ‘‘Com- missioners may specify’’ for ‘‘Commissioners, may specify’’. Subsecs. (b)(1)(B), (c)(5). Pub. L. 103–432, § 171(a)(1), made technical amendment to Pub. L. 101–508, § 4351. See 1990 Amendment notes below. Subsec. (d)(3)(A). Pub. L. 103–432, § 171(d)(1)(D), struck out at end ‘‘This subsection shall not apply to such a seller until such date as the Secretary publishes a list of the standardized benefit packages that may be of- fered consistent with subsection (p) of this section.’’ Pub. L. 103–432, § 171(d)(1)(C), designated third sen- tence as cl. (iii), substituted ‘‘clause (i) with respect to the sale of a medicare supplemental policy’’ for ‘‘the previous sentence’’, and struck out ‘‘and the statement under such subparagraph indicates on its face that the sale of the policy will not duplicate health benefits to which the individual is otherwise entitled’’ after ‘‘com- pliance with subparagraph (B)’’. Pub. L. 103–432, § 171(d)(1)(B), designated second sen- tence as cl. (ii) and substituted ‘‘Whoever violates clause (i)’’ for ‘‘Whoever violates the previous sen- tence’’. Pub. L. 103–432, § 171(d)(1)(A), designated first sen- tence as cl. (i) and amended it generally. Prior to amendment, first sentence read as follows: ‘‘It is un- lawful for a person to sell or issue a health insurance policy to an individual entitled to benefits under part A of this subchapter or enrolled under part B of this subchapter, with knowledge that such policy duplicates Page 3796 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss health benefits to which such individual is otherwise entitled, other than benefits to which he is entitled under a requirement of State or Federal law (other than this subchapter or subchapter XIX of this chap- ter).’’ Subsec. (d)(3)(B)(ii)(II). Pub. L. 103–432, § 171(d)(2)(A), struck out ‘‘65 years of age or older’’ before ‘‘may be el- igible’’. Subsec. (d)(3)(B)(iii)(I). Pub. L. 103–432, § 171(d)(2)(B), (C), substituted ‘‘has a medicare supplemental policy’’ for ‘‘has another medicare supplemental policy’’ and ‘‘sale of a medicare supplemental policy’’ for ‘‘sale of such a policy’’. Subsec. (d)(3)(B)(iii)(II). Pub. L. 103–432, § 171(d)(2)(D), substituted ‘‘has a medicare supplemental policy’’ for ‘‘has another policy’’. Subsec. (d)(3)(B)(iii)(III). Pub. L. 103–432, § 171(d)(2)(E), amended subcl. (III) generally. Prior to amendment, subcl. (III) read as follows: ‘‘Subclause (I) also shall not apply if a State medicaid plan under subchapter XIX of this chapter pays the premiums for the policy, or pays less than an individual’s (who is described in section 1396d(p)(1) of this title) full liability for medicare cost sharing as defined in section 1396d(p)(3)(A) of this title.’’ Subsec. (d)(3)(C). Pub. L. 103–432, § 171(d)(3)(A), sub- stituted ‘‘(i) the sale or issuance of a group policy’’ for ‘‘the selling of a group policy’’ and added cls. (ii) and (iii). Subsec. (d)(3)(D). Pub. L. 103–432, § 171(d)(3)(B), added subpar. (D). Subsec. (d)(4)(D). Pub. L. 103–432, § 171(k)(1), struck out before period at end ‘‘, if such policy expires not more than 12 months after the date on which the dupli- cate copy is mailed’’. Subsec. (d)(4)(E). Pub. L. 103–432, § 171(k)(2), added subpar. (E). Subsec. (f)(3). Pub. L. 103–432, § 171(j)(2), added par. (3). Subsec. (g)(1). Pub. L. 103–432, § 171(f)(1), substituted ‘‘an eligible organization (as defined in section 1395mm(b) of this title) if the policy or plan provides benefits pursuant to a contract under section 1395mm of this title or an approved demonstration project de- scribed in section 603(c) of the Social Security Amend- ments of 1983, section 2355 of the Deficit Reduction Act of 1984, or section 9412(b) of the Omnibus Budget Rec- onciliation Act of 1986, or, during the period beginning on the date specified in subsection (p)(1)(C) of this sec- tion and ending on December 31, 1995, a policy or plan of an organization if the policy or plan provides bene- fits pursuant to an agreement under section 1395l(a)(1)(A) of this title’’ for ‘‘a health maintenance organization or other direct service organization which offers benefits under this subchapter, including such services under a contract under under section 1395mm of this title or an agreement under section 1395l of this title.’’ Subsec. (g)(2)(B). Pub. L. 103–432, § 171(c)(3), sub- stituted ‘‘Secretary’’ for ‘‘Panel’’. Subsec. (o). Pub. L. 103–432, § 171(a)(1), made technical amendment to Pub. L. 101–508, § 4351. See 1990 Amend- ment note below. Subsec. (p). Pub. L. 103–432, § 171(a)(1), made technical amendment to Pub. L. 101–508, § 4351. See 1990 Amend- ment note below. Subsec. (p)(1)(A). Pub. L. 103–432, § 171(a)(2)(A), in in- troductory provisions, substituted ‘‘changes the revised NAIC Model Regulation (described in subsection (m)) to incorporate’’ for ‘‘promulgates’’, and in closing provi- sions, struck out ‘‘(such limitations, language, defini- tions, format, and standards referred to collectively in this subsection as ‘NAIC standards’),’’ before ‘‘sub- section (g)(2)(A)’’ and substituted ‘‘were a reference to the revised NAIC Model Regulation as changed under this subparagraph (such changed regulation referred to in this section as the ‘1991 NAIC Model Regulation’)’’ for ‘‘included a reference to the NAIC standards’’. Subsec. (p)(1)(B). Pub. L. 103–432, § 171(a)(2)(B), sub- stituted ‘‘make the changes in the revised NAIC Model Regulation’’ for ‘‘promulgate NAIC standards’’, ‘‘a reg- ulation’’ for ‘‘limitations, language, definitions, for- mat, and standards described in clauses (i) through (iv) of such subparagraph (in this subsection referred to col- lectively as ‘Federal standards’)’’, and ‘‘were a ref- erence to the revised NAIC Model Regulation as changed by the Secretary under this subparagraph (such changed regulation referred to in this section as the ‘1991 Federal Regulation’)’’ for ‘‘included a ref- erence to the Federal standards’’. Subsec. (p)(1)(C)(i). Pub. L. 103–432, § 171(a)(2)(C), sub- stituted ‘‘1991 NAIC Model Regulation or 1991 Federal Regulation’’ for ‘‘NAIC standards or the Federal stand- ards’’. Subsec. (p)(1)(C)(ii)(I), (E). Pub. L. 103–432, § 171(a)(2)(D), substituted ‘‘1991 NAIC Model Regulation or 1991 Federal Regulation’’ for ‘‘NAIC or Federal standards’’. Subsec. (p)(2). Pub. L. 103–432, § 171(a)(2)(D), sub- stituted ‘‘1991 NAIC Model Regulation or 1991 Federal Regulation’’ for ‘‘NAIC or Federal standards’’ in intro- ductory provisions. Subsec. (p)(2)(C). Pub. L. 103–432, § 171(a)(2)(E), sub- stituted ‘‘paragraph (4)(B)’’ for ‘‘paragraph (5)(B)’’. Subsec. (p)(4). Pub. L. 103–432, § 171(a)(2)(G), sub- stituted ‘‘applicable 1991 NAIC Model Regulation or 1991 Federal Regulation’’ for ‘‘applicable standards’’ wherever appearing. Subsec. (p)(4)(A)(i). Pub. L. 103–432, § 171(a)(2)(F), in- serted ‘‘or paragraph (6)’’ after ‘‘subparagraph (B)’’. Subsec. (p)(6). Pub. L. 103–432, § 171(a)(2)(H), sub- stituted ‘‘described in clauses (i) through (iii) of para- graph (1)(A)’’ for ‘‘in regard to the limitation of bene- fits described in paragraph (4)’’. Subsec. (p)(7). Pub. L. 103–432, § 171(a)(2)(I), sub- stituted ‘‘policyholders’’ for ‘‘policyholder’’. Subsec. (p)(8). Pub. L. 103–432, § 171(a)(2)(J), sub- stituted ‘‘on and after the effective date specified in paragraph (1)(C) (but subject to paragraph (10)), in vio- lation of the applicable 1991 NAIC Model Regulation or 1991 Federal Regulation insofar as such regulation re- lates to the requirements of subsection (o) or (q) or clause (i), (ii), or (iii) of paragraph (1)(A)’’ for ‘‘after the effective date of the NAIC or Federal standards with re- spect to the policy, in violation of the previous require- ments of this subsection’’. Subsec. (p)(9)(B). Pub. L. 103–432, § 171(a)(2)(D), sub- stituted ‘‘1991 NAIC Model Regulation or 1991 Federal Regulation’’ for ‘‘NAIC or Federal standards’’. Subsec. (p)(9)(D). Pub. L. 103–432, § 171(a)(2)(K), added subpar. (D). Subsec. (p)(10). Pub. L. 103–432, § 171(a)(2)(L), sub- stituted ‘‘consistent with paragraph (1)(A)(i)’’ for ‘‘con- sistent with this subsection’’. Subsec. (q)(2). Pub. L. 103–432, § 171(b)(1), substituted ‘‘paragraph (4)’’ for ‘‘paragraph (2)’’. Subsec. (q)(4). Pub. L. 103–432, § 171(b)(2), substituted ‘‘issuer of the replacement policy’’ for ‘‘the succeeding issuer’’. Subsec. (q)(5)(A), (B). Pub. L. 103–432, § 171(d)(4), made technical amendment to the reference to subchapter XIX of this chapter to correct reference to cor- responding provision of original act. Subsec. (r)(1). Pub. L. 103–432, § 171(e)(1)(A), (E), in in- troductory provisions substituted ‘‘or renewed (or oth- erwise provide coverage after the date described in sub- section (p)(1)(C))’’ for ‘‘or sold’’ and inserted at end of closing provisions ‘‘For the purpose of calculating the refund or credit required under paragraph (1)(B) for a policy issued before the date specified in subsection (p)(1)(C), the refund or credit calculation shall be based on the aggregate benefits provided and premiums col- lected under all such policies issued by an insurer in a State (separated as to individual and group policies) and shall be based only on aggregate benefits provided and premiums collected under such policies after the date specified in section 171(m)(4) of the Social Secu- rity Act Amendments of 1994.’’ Subsec. (r)(1)(A). Pub. L. 103–432, § 171(e)(1)(C), sub- stituted ‘‘Commissioners)’’ for ‘‘Commissioners,’’. Pub. L. 103–432, § 171(e)(1)(B), inserted ‘‘for periods after the effective date of these provisions’’ after ‘‘the policy can be expected’’. Page 3797 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss Subsec. (r)(1)(B). Pub. L. 103–432, § 171(e)(1)(D), in- serted before period at end ‘‘, treating policies of the same type as a single policy for each standard pack- age’’. Subsec. (r)(2)(A). Pub. L. 103–432, § 171(e)(1)(F)–(I), sub- stituted ‘‘by standard package’’ for ‘‘by policy number’’ in first sentence and ‘‘until 12 months following issue’’ for ‘‘with respect to the first 2 years in which it is in effect’’ in second sentence, struck out ‘‘in order to apply paragraph (1)(B) to the first 2 years in which poli- cies are effective’’ after ‘‘may be appropriate’’ in third sentence, and inserted at end ‘‘In the case of a policy issued before the date specified in subsection (p)(1)(C), paragraph (1)(B) shall not apply until 1 year after the date specified in section 171(m)(4) of the Social Secu- rity Act Amendments of 1994.’’ Subsec. (r)(2)(C), (D). Pub. L. 103–432, § 171(e)(1)(J), substituted ‘‘calendar year’’ for ‘‘policy year’’ wherever appearing. Subsec. (r)(4). Pub. L. 103–432, § 171(e)(1)(K), sub- stituted ‘‘October’’ for ‘‘February’’, ‘‘disallowance’’ for ‘‘disllowance’’, ‘‘loss ratios’’ for ‘‘loss-ratios’’ in two places, and ‘‘loss ratio’’ for ‘‘loss-ratio’’. Subsec. (r)(6)(A). Pub. L. 103–432, § 171(e)(1)(L), sub- stituted ‘‘fails to provide refunds or credits as required in paragraph (1)(B)’’ for ‘‘issues a policy in violation of the loss ratio requirements of this subsection’’ and ‘‘policy issued for which such failure occurred’’ for ‘‘such violation’’. Subsec. (r)(6)(B). Pub. L. 103–432, § 171(e)(1)(M), sub- stituted ‘‘to the policyholder or, in the case of a group policy, to the certificate holder’’ for ‘‘to policy- holders’’. Subsec. (s)(2)(A). Pub. L. 103–432, § 171(g)(1), (2), sub- stituted ‘‘in the case of an individual for whom an ap- plication is submitted prior to or’’ for ‘‘for which an ap- plication is submitted’’ and ‘‘as of the first day on which the individual is 65 years of age or older and is enrolled for benefits under part B’’ for ‘‘in which the in- dividual (who is 65 years of age or older) first is en- rolled for benefits under part B’’. Subsec. (s)(2)(B). Pub. L. 103–432, § 171(g)(3), sub- stituted ‘‘before the policy became effective’’ for ‘‘be- fore it became effective’’. Subsec. (t)(1). Pub. L. 103–432, § 171(h)(1)(A), (B), sub- stituted ‘‘If a medicare supplemental policy meets the 1991 NAIC Model Regulation or 1991 Federal Regula- tion’’ for ‘‘If a policy meets the NAIC Model Stand- ards’’. Subsec. (t)(1)(A). Pub. L. 103–432, § 171(h)(1)(C), in- serted ‘‘or agreements’’ after ‘‘contracts’’. Subsec. (t)(1)(E)(i), (F). Pub. L. 103–432, § 171(h)(1)(D), substituted ‘‘standards in the 1991 NAIC Model Regula- tion or 1991 Federal Regulation’’ for ‘‘NAIC standards’’. Subsec. (t)(2). Pub. L. 103–432, § 171(h)(1)(E), inserted ‘‘the issuer’’ before ‘‘is subject to a civil money pen- alty’’ in concluding provisions. 1990—Pub. L. 101–508, § 4353(a)(1), struck out ‘‘Vol- untary’’ at beginning of section catchline. Subsec. (a). Pub. L. 101–508, § 4353(a)(2), designated ex- isting provisions as par. (1) and added par. (2). Pub. L. 101–508, § 4207(k)(1), formerly § 4027(k)(1), as re- numbered by Pub. L. 103–432, § 160(d)(4), struck out ‘‘(k)(4),’’ after ‘‘subsections (k)(3),’’ in third sentence. Subsec. (b)(1). Pub. L. 101–508, § 4353(c)(5), inserted at end ‘‘The report required under subsection (F) shall in- clude information on loss ratios of policies sold in the State, frequency and types of instances in which poli- cies approved by the State fail to meet the standards of this paragraph, actions taken by the State to bring such policies into compliance, and information regard- ing State programs implementing consumer protection provisions, and such further information as the Sec- retary in consultation with the National Association of Insurance Commissioners, may specify.’’ Pub. L. 101–508, § 4353(b)(1), (2), substituted ‘‘the Sec- retary’’ for ‘‘Supplemental Health Insurance Panel (es- tablished under paragraph (2))’’ in introductory provi- sions and for ‘‘the Panel’’ in concluding provisions. Pub. L. 101–508, § 4207(k)(1), formerly § 4027(k)(1), as re- numbered by Pub. L. 103–432, § 160(d)(4), which directed the amendment of third sentence of par. (1) by striking out ‘‘(k)(4),’’ was executed by making the deletion after ‘‘subsections (k)(3),’’ in concluding provisions to reflect the probable intent of Congress. Subsec. (b)(1)(A). Pub. L. 101–508, § 4358(b)(2)(A), in- serted before semicolon at end ‘‘, except as otherwise provided by subparagraph (H)’’. Pub. L. 101–508, § 4353(b)(3), inserted ‘‘and enforce- ment’’ after ‘‘application’’. Subsec. (b)(1)(B). Pub. L. 101–508, § 4351(1), formerly § 4351(a)(1), as renumbered and amended by Pub. L. 103–432, § 171(a)(1), substituted ‘‘through (5)’’ for ‘‘through (4)’’. Subsec. (b)(1)(C). Pub. L. 101–508, § 4355(b), substituted for semicolon at end ‘‘, and that a copy of each such policy, the most recent premium for each such policy, and a listing of the ratio of benefits provided to pre- miums collected for the most recent 3-year period for each such policy issued or sold in the State is main- tained and made available to interested persons;’’. Subsec. (b)(1)(D). Pub. L. 101–508, § 4353(b)(3), inserted ‘‘and enforcement’’ after ‘‘application’’. Subsec. (b)(1)(F). Pub. L. 101–508, § 4353(c)(1)–(3), added subpar. (F). Subsec. (b)(1)(G). Pub. L. 101–508, § 4355(c), which di- rected amendment of par. (1) by adding at the end thereof a new subpar. (G), was executed by adding the new subpar. (G) immediately after subpar. (F) to reflect the probable intent of Congress. Subsec. (b)(1)(H). Pub. L. 101–508, § 4358(b)(2)(B)–(D), added subpar. (H). Subsec. (b)(2). Pub. L. 101–508, § 4353(b)(4), amended par. (2) generally. Prior to amendment, par. (2) read as follows: ‘‘(A) There is hereby established a panel (hereinafter in this section referred to as the ‘Panel’) to be known as the Supplemental Health Insurance Panel. The Panel shall consist of the Secretary, who shall serve as the Chairman, and four State commissioners or super- intendents of insurance, who shall be appointed by the Secretary and serve at his pleasure. Such members shall first be appointed not later than December 31, 1980. ‘‘(B) A majority of the members of the Panel shall constitute a quorum, but a lesser number may conduct hearings. ‘‘(C) The Secretary shall provide such technical, sec- retarial, clerical, and other assistance as the Panel may require. ‘‘(D) There are authorized to be appropriated such sums as may be necessary to carry out this paragraph. ‘‘(E) Members of the Panel shall be allowed, while away from their homes or regular places of business in the performance of services for the Panel, travel ex- penses (including per diem in lieu of subsistence) in the same manner as persons employed intermittently in the Government service are allowed expenses under section 5703 of title 5.’’ Subsec. (c). Pub. L. 101–508, § 4357(a)(1), inserted ‘‘or the requirement described in subsection (s)’’ after ‘‘paragraph (3)’’ in introductory provisions. Pub. L. 101–508, § 4355(a)(2), struck out at end ‘‘For purposes of paragraph (2), policies issued as a result of solicitations of individuals through the mails or by mass media advertising (including both print and broadcast advertising) shall be deemed to be individual policies.’’ Subsec. (c)(1). Pub. L. 101–508, § 4358(b)(1), inserted be- fore semicolon at end ‘‘(except as otherwise provided by subsection (t))’’. Subsec. (c)(2). Pub. L. 101–508, § 4355(a)(1), amended par. (2) generally. Prior to amendment, par. (2) read as follows: ‘‘can be expected (as estimated for the entire period for which rates are computed to provide cov- erage, on the basis of incurred claims experience and earned premiums for such period and in accordance with accepted actuarial principles and practices) to re- turn to policyholders in the form of aggregate benefits provided under the policy, at least 75 percent of the ag- gregate amount of premiums collected in the case of Page 3798 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss group policies and at least 60 percent of the aggregate amount of premiums collected in the case of individual policies;’’. Subsec. (c)(5). Pub. L. 101–508, § 4351(2), formerly § 4351(a)(2), as renumbered and amended by Pub. L. 103–432, § 171(a)(1), added par. (5). Subsec. (d)(3)(A). Pub. L. 101–508, § 4354(a)(1), sub- stituted ‘‘It is unlawful for a person to sell or issue’’ for ‘‘Whoever knowingly sells’’, ‘‘duplicates health bene- fits’’ for ‘‘substantially duplicates health benefits’’, ‘‘. Whoever violates the previous sentence shall be fined’’ for ‘‘, shall be fined’’, ‘‘(other than this sub- chapter or subchapter XIX of this chapter)’’ for ‘‘(other than this subchapter)’’, and ‘‘$25,000 (or $15,000 in the case of a person other than the issuer of the policy)’’ for ‘‘$5,000’’ and inserted at end ‘‘A seller (who is not the issuer of a health insurance policy) shall not be considered to violate the previous sentence if the pol- icy is sold in compliance with subparagraph (B) and the statement under such subparagraph indicates on its face that the sale of the policy will not duplicate health benefits to which the individual is otherwise en- titled. This subsection shall not apply to such a seller until such date as the Secretary publishes a list of the standardized benefit packages that may be offered con- sistent with subsection (p) of this section.’’ Subsec. (d)(3)(B). Pub. L. 101–508, § 4354(a)(2), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: ‘‘For purposes of this paragraph, bene- fits which are payable to or on behalf of an individual without regard to other health benefit coverage of such individual, shall not be considered as duplicative.’’ Subsec. (d)(4)(B). Pub. L. 101–508, § 4353(d)(1), struck out at end ‘‘For purposes of this paragraph, a medicare supplemental policy shall be deemed to be approved by the commissioner or superintendent of insurance of a State if— ‘‘(i) the policy has been certified by the Secretary pursuant to subsection (c) of this section or was issued in a State with an approved regulatory pro- gram (as defined in subsection (g)(2)(B) of this sec- tion); ‘‘(ii) the policy has been approved by the commis- sioners or superintendents of insurance in States in which more than 30 percent of such policies are sold; or ‘‘(iii) the State has in effect a law which the com- missioner or superintendent of insurance of the State has determined gives him the authority to review, and to approve, or effectively bar from sale in the State, such policy; except that such a policy shall not be deemed to be ap- proved by a State commissioner or superintendent of insurance if the State notifies the Secretary that such policy has been submitted for approval to the State and has been specifically disapproved by such State after providing appropriate notice and opportunity for hear- ing pursuant to the procedures (if any) of the State.’’ Subsec. (g)(1). Pub. L. 101–508, § 4356(a), inserted before period at end of first sentence ‘‘and does not include a policy or plan of a health maintenance organization or other direct service organization which offers benefits under this subchapter, including such services under a contract under under section 1395mm of this title or an agreement under section 1395l of this title’’. Subsecs. (o), (p). Pub. L. 101–508, § 4351(3), formerly § 4351(a)(3), as renumbered and amended by Pub. L. 103–432, § 171(a)(1), added subsecs. (o) and (p). Subsec. (q). Pub. L. 101–508, § 4352, added subsec. (q). Subsec. (q)(5). Pub. L. 101–508, § 4354(b), added par. (5). Subsec. (r). Pub. L. 101–508, § 4355(a)(3), added subsec. (r). Subsec. (s). Pub. L. 101–508, § 4357(a)(2), added subsec. (s). Subsec. (t). Pub. L. 101–508, § 4358(a), added subsec. (t). 1989—Subsecs. (a), (b)(1). Pub. L. 101–234, § 203(a)(1)(A), substituted ‘‘subsections (k)(3), (k)(4), (m), and (n)’’ for ‘‘subsection (k)(3)’’. Subsec. (k)(1)(A). Pub. L. 101–234, § 203(a)(1)(B)(i), in- serted ‘‘except as provided in subsection (m),’’ before ‘‘subsection (g)(2)(A)’’. Subsec. (k)(3). Pub. L. 101–234, § 203(a)(1)(B)(ii), sub- stituted ‘‘subsections (l), (m), and (n)’’ for ‘‘subsection (l)’’. Subsecs. (m), (n). Pub. L. 101–234, § 203(a)(1)(C), added subsecs. (m) and (n). 1988—Subsec. (a). Pub. L. 100–360, § 221(d)(1), sub- stituted ‘‘Subject to subsection (k)(3), such’’ for ‘‘Such’’. Subsec. (b)(1). Pub. L. 100–360, § 221(d)(2), substituted ‘‘(subject to subsection (k)(3), for so long as’’ for ‘‘(for so long as’’ in concluding provisions. Subsec. (b)(1)(B). Pub. L. 100–360, § 221(a)(1), sub- stituted ‘‘through (4)’’ for ‘‘and (3)’’. Subsec. (b)(1)(C). Pub. L. 100–360, § 221(b)(2), (3), added subpar. (C). Former subpar. (C) redesignated (D). Pub. L. 100–360, § 221(b)(1), substituted ‘‘(A), (B), and (C)’’ for ‘‘(A) and (B)’’. Subsec. (b)(1)(D), (E). Pub. L. 100–360, § 221(b)(2), redes- ignated former subpars. (C) and (D) as (D) and (E), re- spectively. Subsec. (b)(2)(A). Pub. L. 100–360, § 221(f), substituted ‘‘appointed by the Secretary’’ for ‘‘appointed by the President’’. Subsec. (b)(3). Pub. L. 100–360, § 221(e), added par. (3). Subsec. (c). Pub. L. 100–360, § 411(i)(1)(B), added Pub. L. 100–203, § 4081(b)(2)(A), see 1987 Amendment note below. Subsec. (c)(3). Pub. L. 100–360, § 411(i)(1)(B), redesig- nated Pub. L. 100–203, § 4081(b)(2)(B)–(D), see 1987 Amendment note below. Subsec. (c)(3)(A). Pub. L. 100–360, § 411(i)(1)(C)(i), sub- stituted ‘‘claim form’’ for ‘‘claims form’’ in two places and ‘‘such notice’’ for ‘‘such claims form’’. Subsec. (c)(3)(B)(i). Pub. L. 100–360, § 411(i)(1)(C)(ii), in- serted ‘‘under the policy’’ after ‘‘payment determina- tion’’. Subsec. (c)(3)(B)(ii). Pub. L. 100–360, § 411(i)(1)(C)(iii), substituted ‘‘payment covered by such policy’’ for ‘‘ap- propriate payment’’. Subsec. (c)(4). Pub. L. 100–360, § 221(a)(2), added par. (4). Subsec. (d). Pub. L. 100–360, § 428(b)(1), substituted ‘‘shall be fined under title 18 or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $5,000 for each such prohibited act’’ for ‘‘shall be guilty of a felony and upon convic- tion thereof shall be fined not more than $25,000 or im- prisoned for not more than 5 years, or both’’ in pars. (1), (2), (3)(A), and (4)(A). Subsec. (d)(5). Pub. L. 100–360, § 428(b)(2), added par. (5). Subsec. (e). Pub. L. 100–360, § 221(c), designated exist- ing provision as par. (1) and added pars. (2) and (3). Subsecs. (k), (l). Pub. L. 100–360, § 221(d)(3), added sub- secs. (k) and (l). 1987—Subsec. (b)(1)(B). Pub. L. 100–203, § 4081(b)(1)(A), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: ‘‘includes a requirement equal to or more stringent than the requirement de- scribed in subsection (c)(2) of this section; and’’. Subsec. (b)(1)(D). Pub. L. 100–203, § 4081(b)(1)(B), (C), added subpar. (D). Subsec. (c). Pub. L. 100–203, § 4081(b)(2)(A), as added by Pub. L. 100–360, § 411(i)(1)(B), inserted ‘‘(or, with respect to paragraph (3), the issuer of the policy)’’ in introduc- tory provisions. Subsec. (c)(3). Pub. L. 100–203, § 4081(b)(2)(B)–(D), for- merly § 4081(b)(2), as redesignated by Pub. L. 100–360, § 411(i)(1)(B), added par. (3). Subsec. (d)(1). Pub. L. 100–93 substituted ‘‘knowingly and willfully’’ for ‘‘knowingly or willfully’’. Statutory Notes and Related Subsidiaries CHANGE OF NAME References to Medicare+Choice deemed to refer to Medicare Advantage or MA, subject to an appropriate transition provided by the Secretary of Health and Page 3799 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss Human Services in the use of those terms, see section 201 of Pub. L. 108–173, set out as a note under section 1395w–21 of this title. Committee on Interstate and Foreign Commerce of House of Representatives changed to Committee on En- ergy and Commerce of House of Representatives imme- diately prior to noon on Jan. 3, 1981, by House Resolu- tion No. 549, Ninety-sixth Congress, Mar. 25, 1980. Com- mittee on Energy and Commerce of House of Represent- atives treated as referring to Committee on Commerce of House of Representatives by section 1(a) of Pub. L. 104–14, set out as a note preceding section 21 of Title 2, The Congress. Committee on Commerce of House of Representatives changed to Committee on Energy and Commerce of House of Representatives, and jurisdic- tion over matters relating to securities and exchanges and insurance generally transferred to Committee on Financial Services of House of Representatives by House Resolution No. 5, One Hundred Seventh Con- gress, Jan. 3, 2001. EFFECTIVE DATE OF 2008 AMENDMENT Pub. L. 110–233, title I, § 104(c), May 21, 2008, 122 Stat. 903, provided that: ‘‘The amendments made by this sec- tion [amending this section] shall apply with respect to an issuer of a medicare supplemental policy for policy years beginning on or after the date that is 1 year after the date of enactment of this Act [May 21, 2008].’’ EFFECTIVE DATE OF 1999 AMENDMENTS Pub. L. 106–170, title II, § 205(b), Dec. 17, 1999, 113 Stat. 1900, provided that: ‘‘The amendments made by sub- section (a) [amending this section] apply with respect to requests made after the date of the enactment of this Act [Dec. 17, 1999].’’ Amendment by section 1000(a)(6) [title III, § 321(k)(13), (14)] of Pub. L. 106–113 effective as if included in the en- actment of the Balanced Budget Act of 1997, Pub. L. 105–33, except as otherwise provided, see section 1000(a)(6) [title III, § 321(m)] of Pub. L. 106–113, set out as a note under section 1395d of this title. Amendment by section 1000(a)(6) [title V, § 501(a)(2)] of Pub. L. 106–113 applicable to notices of impending terminations or discontinuances made on or after Nov. 29, 1999, see section 1000(a)(6) [title V, § 501(d)(1)] of Pub. L. 106–113, set out as a note under section 1395w–21 of this title. Pub. L. 106–113, div. B, § 1000(a)(6) [title V, § 536(b)], Nov. 29, 1999, 113 Stat. 1536, 1501A–391, provided that: ‘‘The amendments made by this section [amending this section] shall apply to terminations or discontinuances made on or after the date of the enactment of this Act [Nov. 29, 1999].’’ EFFECTIVE DATE OF 1997 AMENDMENT Pub. L. 105–33, title IV, § 4002(j)(2), Aug. 5, 1997, 111 Stat. 330, provided that the amendment made by that section is effective Jan. 1, 1999. Pub. L. 105–33, title IV, § 4031(d), Aug. 5, 1997, 111 Stat. 357, provided that: ‘‘(1) GUARANTEED ISSUE.—The amendment made by subsection (a) [amending this section] shall take effect on July 1, 1998. ‘‘(2) LIMIT ON PREEXISTING CONDITION EXCLUSIONS.— The amendment made by subsection (b) [amending this section] shall apply to policies issued on or after July 1, 1998. ‘‘(3) CONFORMING AMENDMENT.—The amendment made by subsection (c) [amending this section] shall be effec- tive as if included in the enactment of the Health In- surance Portability and Accountability Act of 1996 [Pub. L. 104–191].’’ Pub. L. 105–33, title IV, § 4032(b), Aug. 5, 1997, 111 Stat. 359, provided that: ‘‘(1) IN GENERAL.—The amendments made by sub- section (a) [amending this section] shall take effect the date of the enactment of this Act [Aug. 5, 1997]. ‘‘(2) TRANSITION.—The provisions of section 4031(e) [set out as a note below] shall apply with respect to this section in the same manner as they apply to sec- tion 4031 [amending this section and enacting provi- sions set out as notes below].’’ EFFECTIVE DATE OF 1996 AMENDMENT Pub. L. 104–191, title II, § 271(d), Aug. 21, 1996, 110 Stat. 2036, provided that: ‘‘(1) Except as provided in this subsection, the amend- ment made by subsection (a) [amending this section] shall be effective as if included in the enactment of sec- tion 4354 of the Omnibus Budget Reconciliation Act of 1990 [Pub. L. 101–508]. ‘‘(2)(A) Clause (vi) of section 1882(d)(3)(A) of the So- cial Security Act [42 U.S.C. 1395ss(d)(3)(A)(vi)], as added by subsection (a), shall only apply to individuals apply- ing for— ‘‘(i) a health insurance policy described in section 1882(d)(3)(A)(iv) of such Act (as added by subsection (a)), after the date of the enactment of this Act [Aug. 21, 1996], or ‘‘(ii) another health insurance policy after the end of the 30-day period beginning on the date of the en- actment of this Act. ‘‘(B) A seller or issuer of a health insurance policy may substitute, for the disclosure statement described in clause (vii) of such section, the statement specified under section 1882(d)(3)(D) of the Social Security Act (as in effect before the date of the enactment of this Act), without the revision specified in such clause.’’ EFFECTIVE DATE OF 1994 AMENDMENT Pub. L. 103–432, title I, § 171(l), Oct. 31, 1994, 108 Stat. 4451, provided that: ‘‘The amendments made by this section [amending this section and sections 1320c–3, 1395b–2, and 1395b–4 of this title, repealing section 1395zz of this title, and enacting and amending provisions set out as notes below] shall be effective as if included in the enactment of OBRA–1990 [Pub. L. 101–508]; except that— ‘‘(1) the amendments made by subsection (d)(1) [amending this section] shall take effect on the date of the enactment of this Act [Oct. 31, 1994], but no penalty shall be imposed under section 1882(d)(3)(A) of the Social Security Act [42 U.S.C. 1395ss(d)(3)(A)] (for an action occurring after the effective date of the amendments made by section 4354 of OBRA–1990 [see section 4354(c) of Pub. L. 101–508, set out as an Effec- tive Date of 1990 Amendment note below] and before the date of the enactment of this Act) with respect to the sale or issuance of a policy which is not unlawful under section 1882(d)(3)(A)(i)(II) of the Social Secu- rity Act [42 U.S.C. 1395ss(d)(3)(A)(i)(II)] (as amended by this section); ‘‘(2) the amendments made by subsection (d)(2)(A) [amending this section] and by subparagraphs (A), (B), and (E) of subsection (e)(1) [amending this sec- tion] shall be effective on the date specified in sub- section (m)(4) [set out as a note below]; and ‘‘(3) the amendment made by subsection (g)(2) [amending this section] shall take effect on January 1, 1995, and shall apply to individuals who attain 65 years of age or older on or after the effective date of section 1882(s)(2) of the Social Security Act [42 U.S.C. 1395ss(s)(2), for effective date see section 4357(b) of Pub. L. 101–508, set out as an Effective Date of 1990 Amendment note below] (and, in the case of individ- uals who attained 65 years of age after such effective date and before January 1, 1995, and who were not covered under such section before January 1, 1995, the 6-month period specified in that section shall begin January 1, 1995).’’ EFFECTIVE DATE OF 1990 AMENDMENT Pub. L. 101–508, title IV, § 4353(d)(2), Nov. 5, 1990, 104 Stat. 1388–130, provided that: ‘‘The amendment made by paragraph (1) [amending this section] shall apply to policies mailed, or caused to be mailed, on and after July 1, 1991.’’ Pub. L. 101–508, title IV, § 4354(c), Nov. 5, 1990, 104 Stat. 1388–132, provided that: ‘‘The amendments made Page 3800 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss by this section [amending this section] shall apply to policies issued or sold more than 1 year after the date of the enactment of this Act [Nov. 5, 1990].’’ Pub. L. 101–508, title IV, § 4355(d), Nov. 5, 1990, 104 Stat. 1388–134, as amended by Pub. L. 103–432, title I, § 171(e)(3), Oct. 31, 1994, 108 Stat. 4449, provided that: ‘‘The amendments made by this section [amending this section] shall apply to policies issued or renewed (or otherwise providing coverage after the date described in section 1882(p)(1)(C) of the Social Security Act [42 U.S.C. 1395ss(p)(1)(C)]) on or after the date specified in section 1882(p)(1)(C) of the Social Security Act.’’ Pub. L. 101–508, title IV, § 4356(b), Nov. 5, 1990, 104 Stat. 1388–134, as amended by Pub. L. 103–432, title I, § 171(f)(2), Oct. 31, 1994, 108 Stat. 4449, provided that: ‘‘The amendment made by subsection (a) [amending this section] shall take effect on the date specified in section 1882(p)(1)(C) of the Social Security Act [42 U.S.C. 1395ss(p)(1)(C)].’’ Pub. L. 101–508, title IV, § 4357(b), Nov. 5, 1990, 104 Stat. 1388–135, provided that: ‘‘The amendments made by subsection (a) [amending this section] shall take ef- fect 1 year after the date of the enactment of this Act [Nov. 5, 1990].’’ Amendment by section 4358(a), (b)(1), (2) of Pub. L. 101–508 only applicable in 15 States (as determined by Secretary of Health and Human Services) and such other States as elect such amendment to apply to them, and during the 61⁄2-year period beginning with 1992, with such amendment to remain in effect beyond the 61⁄2-year period unless the Secretary makes certain determinations, see section 4358(c) of Pub. L. 101–508, as amended, set out as a note under section 1320c–3 of this title. EFFECTIVE DATE OF 1989 AMENDMENT Pub. L. 101–234, title II, § 203(e), Dec. 13, 1989, 103 Stat. 1985, provided that: ‘‘The provisions of this section [amending this section, enacting provisions set out as notes under sections 1395b–2 and 1395mm of this title, and amending provisions set out as a note under this section] shall take effect January 1, 1990, except that the amendment made by subsection (d) [amending pro- visions set out as an Effective Date of 1988 Amendment note under this section] shall be effective as if included in the enactment of MCCA [Pub. L. 100–360].’’ EFFECTIVE DATE OF 1988 AMENDMENT Pub. L. 100–360, title II, § 221(g), July 1, 1988, 102 Stat. 746, as amended by Pub. L. 100–485, title VI, § 608(d)(12), Oct. 13, 1988, 102 Stat. 2415; Pub. L. 101–234, title II, § 203(d), Dec. 13, 1989, 103 Stat. 1985, provided that: ‘‘(1) Except as provided in paragraphs (2) and (3), the amendments made by this section [amending this sec- tion] shall take effect on the date of the enactment of this Act [July 1, 1988]. ‘‘(2) The amendments made by subsections (a) and (b) [amending this section] shall become effective on the date specified in subsection (k)(1)(B) or (k)(2)(B) of sec- tion 1882 of the Social Security Act [42 U.S.C. 1395ss(k)(1)(B), (2)(B)] (as added by subsection (d) of this section). ‘‘(3) The amendment made by subsection (e) [amend- ing this section] shall apply to medicare supplemental policies as of January 1, 1989, with respect to adver- tising used on or after such date. ‘‘(4) The Secretary of Health and Human Services shall provide for the reappointment of members to the Supplemental Health Insurance Panel (under section 1882(b)(2) of the Social Security Act [42 U.S.C. 1395ss(b)(2)]) by not later than 90 days after the date of the enactment of this Act [July 1, 1988].’’ Except as specifically provided in section 411 of Pub. L. 100–360, amendment by section 411(i)(1)(B), (C) of Pub. L. 100–360, as it relates to a provision in the Omni- bus Budget Reconciliation Act of 1987, Pub. L. 100–203, effective as if included in the enactment of that provi- sion in Pub. L. 100–203, see section 411(a) of Pub. L. 100–360, set out as a Reference to OBRA; Effective Date note under section 106 of Title 1, General Provisions. Amendment by section 428(b) of Pub. L. 100–360 effec- tive July 1, 1988, and applicable only with respect to violations occurring on or after such date, see section 428(c) of Pub. L. 100–360, set out as an Effective Date note under section 1320b–10 of this title. EFFECTIVE DATE OF 1987 AMENDMENT Pub. L. 100–203, title IV, § 4081(c)(2), Dec. 22, 1987, 101 Stat. 1330–128, as amended by Pub. L. 100–360, title IV, § 411(i)(1)(D), (E), July 1, 1988, 102 Stat. 788; Pub. L. 100–485, title VI, § 608(d)(24)(A), Oct. 13, 1988, 102 Stat. 2421, provided that: ‘‘(A) The amendments made by subsection (b) [amending this section] shall apply to medicare supple- mental policies as of January 1, 1989 (or, if applicable, the date established under subparagraph (B)). ‘‘(B) In the case of a State which the Secretary of Health and Human Services identifies as— ‘‘(i) requiring State legislation (other than legisla- tion appropriating funds) in order for medicare sup- plemental policies to be changed to meet the require- ments of section 1882(c)(3) of the Social Security Act [42 U.S.C. 1395ss(c)(3)], and ‘‘(ii) having a legislature which is not scheduled to meet in 1988 in a legislative session in which such leg- islation may be considered or which has not enacted such legislation before July 1, 1988, the date specified in this subparagraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1989, and in which legislation described in clause (i) may be considered.’’ Amendment by Pub. L. 100–93 effective at end of four- teen-day period beginning Aug. 18, 1987, and inappli- cable to administrative proceedings commenced before end of such period, see section 15(a) of Pub. L. 100–93, set out as a note under section 1320a–7 of this title. EFFECTIVE DATE Pub. L. 96–265, title V, § 507(b), June 9, 1980, 94 Stat. 481, provided that: ‘‘The amendment made by this sec- tion [enacting this section] shall become effective on the date of the enactment of this Act [June 9, 1980], ex- cept that the provisions of paragraph (4) of section 1882(d) of the Social Security Act [42 U.S.C. 1395ss(d)(4)] (as added by this section) shall become effective on July 1, 1982.’’ RULE OF CONSTRUCTION Pub. L. 108–173, title I, § 104(c), Dec. 8, 2003, 117 Stat. 2165, provided that: ‘‘(1) IN GENERAL.—Nothing in this Act [see Tables for classification] shall be construed to require an issuer of a medicare supplemental policy under section 1882 of the Social Security Act (42 U.S.C. 1395rr) [42 U.S.C. 1395ss] to participate as a PDP sponsor under part D of title XVIII of such Act [42 U.S.C. 1395w–101 et seq.], as added by section 101, as a condition for issuing such policy. ‘‘(2) PROHIBITION ON STATE REQUIREMENT.—A State may not require an issuer of a medicare supplemental policy under section 1882 of the Social Security Act (42 U.S.C. 1395rr) [42 U.S.C. 1395ss] to participate as a PDP sponsor under such part D as a condition for issuing such policy.’’ IMPLEMENTATION OF NAIC RECOMMENDATIONS Pub. L. 110–275, title I, § 104(a), July 15, 2008, 122 Stat. 2501, provided that: ‘‘(1) IN GENERAL.—The Secretary of Health and Human Services (in this section [enacting section 1395ss–1 of this title and amending this section] referred to as the ‘Secretary’) shall provide for implementation of the changes in the NAIC model law and regulations approved by the National Association of Insurance Commissioners in its Model #651 (‘Model Regulation to Implement the NAIC Medicare Supplement Insurance Minimum Standards Model Act’) on March 11, 2007, as modified to reflect the changes made under this Act Page 3801 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss [see Short Title of 2008 Amendment note set out under section 1305 of this title] and the Genetic Information Nondiscrimination Act of 2008 (Public Law 110–233) [see Short Title note set out under section 2000ff of this title]. ‘‘(2) IMPLEMENTATION DATES.— ‘‘(A) IN GENERAL.—The modifications to Model #651 required under paragraph (1) shall be completed by the National Association of Insurance Commissioners not later than October 31, 2008. Except as provided in subparagraph (B), each State shall have 1 year from the date the National Association of Insurance Com- missioners adopts the revised NAIC model law and regulations (as changed by Model #651, as so modi- fied) to conform the regulatory program established by the State to such revised NAIC model law and reg- ulations. ‘‘(B) EXTENSION OF EFFECTIVE DATE FOR STATE LAW AMENDMENT.—In the case of a State which the Sec- retary determines requires State legislation in order to conform the regulatory program established by the State to such revised NAIC model law and regula- tions, the State shall not be regarded as failing to comply with the requirements of this section solely on the basis of its failure to meet such requirements before the first day of the first calendar quarter be- ginning after the close of the first regular session of the State legislature that begins after the date of the enactment of this Act [July 15, 2008]. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of the session is considered to be a separate regular session of the State legislature. ‘‘(C) TRANSITION DATES.—No carrier may issue a new or revised medicare supplemental policy or cer- tificate under section 1882 of the Social Security Act (42 U.S.C. 1395ss) that meets the requirements of such revised NAIC model law and regulations for coverage effective prior to June 1, 2010. A carrier may continue to offer or issue a medicare supplemental policy under such section that meets the requirements of the NAIC model law and regulations and State law (as in effect prior to the adoption of such revised NAIC model law and regulations) prior to June 1, 2010. Nothing shall preclude carriers from marketing new or revised medicare supplemental policies or cer- tificates that meet the requirements of such revised NAIC model law and regulations on or after the date on which the State conforms the regulatory program established by the State to such revised NAIC model law and regulations.’’ STUDY OF MEDIGAP POLICIES Pub. L. 106–113, div. B, § 1000(a)(6) [title V, § 553(a)], Nov. 29, 1999, 113 Stat. 1536, 1501A–393, provided that: ‘‘(1) IN GENERAL.—The Comptroller General of the United States (in this section referred to as the ‘Comp- troller General’) shall conduct a study of the issues de- scribed in paragraph (2) regarding medicare supple- mental policies described in section 1882(g)(1) of the So- cial Security Act (42 U.S.C. 1395ss(g)(1)). ‘‘(2) ISSUES TO BE STUDIED.—The issues described in this paragraph are the following: ‘‘(A) The level of coverage provided by each type of medicare supplemental policy. ‘‘(B) The current enrollment levels in each type of medicare supplemental policy. ‘‘(C) The availability of each type of medicare sup- plemental policy to medicare beneficiaries over age 651⁄2. ‘‘(D) The number and type of medicare supple- mental policies offered in each State. ‘‘(E) The average out-of-pocket costs (including premiums) per beneficiary under each type of medi- care supplemental policy. ‘‘(2)[(3)] REPORT.—Not later than July 31, 2001, the Comptroller General shall submit a report to Congress on the results of the study conducted under this sub- section, together with any recommendations for legis- lation that the Comptroller General determines to be appropriate as a result of such study.’’ CONFORMING BENEFITS TO CHANGES IN TERMINOLOGY FOR HOSPITAL OUTPATIENT DEPARTMENT COST SHARING Pub. L. 105–33, title IV, § 4031(f), Aug. 5, 1997, 111 Stat. 359, provided that: ‘‘For purposes of apply [sic] section 1882 of the Social Security Act (42 U.S.C. 1395ss) and regulations referred to in subsection (e) [set out as a note above], copayment amounts provided under sec- tion 1833(t)(5) of such Act [42 U.S.C. 1395l(t)(5)] with re- spect to hospital outpatient department services shall be treated under medicare supplemental policies in the same manner as coinsurance with respect to such serv- ices.’’ TRANSITION PROVISIONS Pub. L. 110–233, title I, § 104(d), May 21, 2008, 122 Stat. 903, provided that: ‘‘(1) IN GENERAL.—If the Secretary of Health and Human Services identifies a State as requiring a change to its statutes or regulations to conform its regulatory program to the changes made by this sec- tion [amending this section], the State regulatory pro- gram shall not be considered to be out of compliance with the requirements of section 1882 of the Social Se- curity Act [42 U.S.C. 1395ss] due solely to failure to make such change until the date specified in paragraph (4). ‘‘(2) NAIC STANDARDS.—If, not later than October 31, 2008, the National Association of Insurance Commis- sioners (in this subsection referred to as the ‘NAIC’) modifies its NAIC Model Regulation relating to section 1882 of the Social Security Act [42 U.S.C. 1395ss] (re- ferred to in such section as the 1991 NAIC Model Regu- lation, as subsequently modified) to conform to the amendments made by this section [amending this sec- tion], such revised regulation incorporating the modi- fications shall be considered to be the applicable NAIC model regulation (including the revised NAIC model regulation and the 1991 NAIC Model Regulation) for the purposes of such section. ‘‘(3) SECRETARY STANDARDS.—If the NAIC does not make the modifications described in paragraph (2) within the period specified in such paragraph, the Sec- retary of Health and Human Services shall, not later than July 1, 2009, make the modifications described in such paragraph and such revised regulation incor- porating the modifications shall be considered to be the appropriate regulation for the purposes of such section. ‘‘(4) DATE SPECIFIED.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), the date specified in this paragraph for a State is the ear- lier of— ‘‘(i) the date the State changes its statutes or regulations to conform its regulatory program to the changes made by this section, or ‘‘(ii) July 1, 2009. ‘‘(B) ADDITIONAL LEGISLATIVE ACTION REQUIRED.—In the case of a State which the Secretary identifies as— ‘‘(i) requiring State legislation (other than legis- lation appropriating funds) to conform its regu- latory program to the changes made in this section, but ‘‘(ii) having a legislature which is not scheduled to meet in 2009 in a legislative session in which such legislation may be considered, the date speci- fied in this paragraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after July 1, 2009. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a separate regular session of the State legislature.’’ Pub. L. 105–33, title IV, § 4031(e), Aug. 5, 1997, 111 Stat. 358, provided that: ‘‘(1) IN GENERAL.—If the Secretary of Health and Human Services identifies a State as requiring a change to its statutes or regulations to conform its regulatory program to the changes made by this sec- Page 3802 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395ss tion [amending this section], the State regulatory pro- gram shall not be considered to be out of compliance with the requirements of section 1882 of the Social Se- curity Act [42 U.S.C. 1395ss] due solely to failure to make such change until the date specified in paragraph (4). ‘‘(2) NAIC STANDARDS.—If, within 9 months after the date of the enactment of this Act [Aug. 5, 1997], the Na- tional Association of Insurance Commissioners (in this subsection referred to as the ‘NAIC’) modifies its NAIC Model Regulation relating to section 1882 of the Social Security Act [42 U.S.C. 1395ss] (referred to in such sec- tion as the 1991 NAIC Model Regulation, as modified pursuant to section 171(m)(2) of the Social Security Act Amendments of 1994 (Public Law 103–432) [set out as a note below] and as modified pursuant to section 1882(d)(3)(A)(vi)(IV) of the Social Security Act [42 U.S.C. 1395ss(d)(3)(A)(vi)(IV)], as added by section 271(a) of the Health Insurance Portability and Accountability Act of 1996 (Public Law 104–191) to conform to the amendments made by this section [amending this sec- tion], such revised regulation incorporating the modi- fications shall be considered to be the applicable NAIC model regulation (including the revised NAIC model regulation and the 1991 NAIC Model Regulation) for the purposes of such section. ‘‘(3) SECRETARY STANDARDS.—If the NAIC does not make the modifications described in paragraph (2) within the period specified in such paragraph, the Sec- retary of Health and Human Services shall make the modifications described in such paragraph and such re- vised regulation incorporating the modifications shall be considered to be the appropriate Regulation for the purposes of such section. ‘‘(4) DATE SPECIFIED.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), the date specified in this paragraph for a State is the ear- lier of— ‘‘(i) the date the State changes its statutes or regulations to conform its regulatory program to the changes made by this section, or ‘‘(ii) 1 year after the date the NAIC or the Sec- retary first makes the modifications under para- graph (2) or (3), respectively. ‘‘(B) ADDITIONAL LEGISLATIVE ACTION REQUIRED.—In the case of a State which the Secretary identifies as— ‘‘(i) requiring State legislation (other than legis- lation appropriating funds) to conform its regu- latory program to the changes made in this section, but ‘‘(ii) having a legislature which is not scheduled to meet in 1999 in a legislative session in which such legislation may be considered, the date specified in this paragraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after July 1, 1999. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a separate regular session of the State legislature.’’ Pub. L. 104–191, title II, § 271(c), Aug. 21, 1996, 110 Stat. 2036, provided that: ‘‘(1) NO PENALTIES.—Subject to paragraph (3), no criminal or civil money penalty may be imposed under section 1882(d)(3)(A) of the Social Security Act [42 U.S.C. 1395ss(d)(3)(A)] for any act or omission that oc- curred during the transition period (as defined in para- graph (4)) and that relates to any health insurance pol- icy that is described in clause (iv) or (v) of such section (as amended by subsection (a)). ‘‘(2) LIMITATION ON LEGAL ACTION.—Subject to para- graph (3), no legal action shall be brought or continued in any Federal or State court insofar as such action— ‘‘(A) includes a cause of action which arose, or which is based on or evidenced by any act or omission which occurred, during the transition period; and ‘‘(B) relates to the application of section 1882(d)(3)(A) of the Social Security Act to any act or omission with respect to the sale, issuance, or re- newal of any health insurance policy that is described in clause (iv) or (v) of such section (as amended by subsection (a)). ‘‘(3) DISCLOSURE CONDITION.—In the case of a policy described in clause (iv) of section 1882(d)(3)(A) of the Social Security Act that is sold or issued on or after the effective date of statements under section 171(d)(3)(C) of the Social Security Act Amendments of 1994 [Pub. L. 103–432, set out below] and before the end of the 30-day period beginning on the date of the enact- ment of this Act [Aug. 21, 1996], paragraphs (1) and (2) shall only apply if disclosure was made in accordance with section 1882(d)(3)(C)(ii) of the Social Security Act (as in effect before the date of the enactment of this Act). ‘‘(4) TRANSITION PERIOD.—In this subsection, the term ‘transition period’ means the period beginning on No- vember 5, 1991, and ending on the date of the enactment of this Act.’’ APPLICABILITY OF DISCLOSURE REQUIREMENT Pub. L. 103–432, title I, § 171(d)(3)(C), Oct. 31, 1994, 108 Stat. 4448, provided that: ‘‘The requirement of a disclo- sure under section 1882(d)(3)(C)(ii) of the Social Secu- rity Act [42 U.S.C. 1395ss(d)(3)(C)(ii)] shall not apply to an application made for a policy or plan before 60 days after the date the Secretary of Health and Human Serv- ices publishes or promulgates all the statements under section 1882(d)(3)(D) of such Act.’’ STATE REGULATORY PROGRAMS Pub. L. 103–432, title I, § 171(m), Oct. 31, 1994, 108 Stat. 4451, provided that: ‘‘(1) IN GENERAL.—If the Secretary of Health and Human Services identifies a State as requiring a change to its statutes or regulations to conform its regulatory program to the changes made by this sec- tion [amending this section and sections 1320c–3, 1395b–2, and 1395b–4 of this title, repealing section 1395zz of this title, and enacting and amending provisions set out as notes under this section], the State regulatory program shall not be considered to be out of compli- ance with the requirements of section 1882 of the Social Security Act [42 U.S.C. 1395ss] due solely to failure to make such change until the date specified in paragraph (4). ‘‘(2) NAIC STANDARDS.—If, within 6 months after the date of the enactment of this Act [Oct. 31, 1994], the Na- tional Association of Insurance Commissioners (in this subsection referred to as the ‘NAIC’) modifies its 1991 NAIC Model Regulation (adopted in July 1991) to con- form to the amendments made by this section and to delete from section 15C the exception which begins with ‘unless’, such revised regulation incorporating the modifications shall be considered to be the 1991 Regula- tion for the purposes of section 1882 of the Social Secu- rity Act. ‘‘(3) SECRETARY STANDARDS.—If the NAIC does not make the modifications described in paragraph (2) within the period specified in such paragraph, the Sec- retary of Health and Human Services shall make the modifications described in such paragraph and such re- vised regulation incorporating the modifications shall be considered to be the 1991 Regulation for the purposes of section 1882 of the Social Security Act. ‘‘(4) DATE SPECIFIED.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), the date specified in this paragraph for a State is the ear- lier of— ‘‘(i) the date the State changes its statutes or regulations to conform its regulatory program to the changes made by this section, or ‘‘(ii) 1 year after the date the NAIC or the Sec- retary first makes the modifications under para- graph (2) or (3), respectively. ‘‘(B) ADDITIONAL LEGISLATIVE ACTION REQUIRED.—In the case of a State which the Secretary identifies as— Page 3803 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 1395tt 1 So in original. ‘‘(i) requiring State legislation (other than legis- lation appropriating funds) to conform its regu- latory program to the changes made in this section, but ‘‘(ii) having a legislature which is not scheduled to meet in 1996 in a legislative session in which such legislation may be considered, the date specified in this paragraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1996. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such ses- sion shall be deemed to be a separate regular session of the State legislature.’’ EVALUATION OF 1990 AMENDMENTS Pub. L. 101–508, title IV, § 4358(d), Nov. 5, 1990, 104 Stat. 1388–137, provided that: ‘‘The Secretary of Health and Human Services shall conduct an evaluation of the amendments made by this section [amending this sec- tion and section 1320c–3 of this title] and shall report to Congress on such evaluation by not later than January 1, 1995.’’ § 1395ss–1. Clarification Any health insurance policy that provides re- imbursement for expenses incurred for items and services for which payment may be made under title XVIII of the Social Security Act [42 U.S.C. 1395 et seq.] but which are not reimburs- able by reason of the applicability of deductibles, coinsurance, copayments or other limitations imposed by a Medicare Advantage plan (including a Medicare Advantage private fee-for-service plan) under part C of such title [42 U.S.C. 1395w–21 et seq.] shall comply with the requirements of section 1882(o) of the such 1 Act (42 U.S.C. 1395ss(o)). (Pub. L. 110–275, title I, § 104(c), July 15, 2008, 122 Stat. 2502.) Editorial Notes REFERENCES IN TEXT The Social Security Act, referred to in text, is act Aug. 14, 1935, ch. 531, 49 Stat. 620. Title XVIII of the Act is classified generally to this subchapter. Part C of title XVIII of the Act is classified to section 1395w–21 et seq. of this title. For complete classification of this Act to the Code, see section 1305 of this title and Tables. CODIFICATION Section was enacted as part of the Medicare Improve- ments for Patients and Providers Act of 2008, and not as part of the Social Security Act which comprises this chapter. § 1395tt. Hospital providers of extended care services (a) Hospital facility agreements; reasonable costs of services (1) Any hospital which has an agreement under section 1395cc of this title may (subject to sub- section (b)) enter into an agreement with the Secretary under which its inpatient hospital fa- cilities may be used for the furnishing of serv- ices of the type which, if furnished by a skilled nursing facility, would constitute extended care services. (2)(A) Notwithstanding any other provision of this subchapter, payment to any hospital (other than a critical access hospital) for services fur- nished under an agreement entered into under this section shall be based upon the reasonable cost of the services as determined under sub- paragraph (B). (B)(i) The reasonable cost of the services con- sists of the reasonable cost of routine services (determined under clause (ii)) and the reason- able cost of ancillary services (determined under clause (iii)). (ii) The reasonable cost of routine services fur- nished during any calendar year by a hospital under an agreement under this section is equal to the product of— (I) the number of patient-days during the year for which the services were furnished, and (II) the average reasonable cost per patient- day, such average reasonable cost per patient- day being the average rate per patient-day paid for routine services during the most re- cent year for which cost reporting data are available with respect to such services (in- creased in a compounded manner by the appli- cable increase for payments for routine service costs of skilled nursing facilities under sub- sections (a) through (d) of section 1395yy of this title for subsequent cost reporting periods and up to and including such calendar year) under this subchapter to freestanding skilled nursing facilities in the region (as defined in section 1395ww(d)(2)(D) of this title) in which the facility is located. (iii) The reasonable cost of ancillary services shall be determined in the same manner as the reasonable cost of ancillary services provided for inpatient hospital services. (3) Notwithstanding any other provision of this subchapter, a critical access hospital shall be paid for covered skilled nursing facility serv- ices furnished under an agreement entered into under this section on the basis of equal to 101 percent of the reasonable costs of such services (as determined under section 1395x(v) of this title). (b) Eligible facilities The Secretary may not enter into an agree- ment under this section with any hospital un- less, except as provided under subsection (g), the hospital is located in a rural area and has less than 100 beds. (c) Terms and conditions of facility agreements An agreement with a hospital under this sec- tion shall, except as otherwise provided under regulations of the Secretary, be of the same du- ration and subject to termination on the same conditions as are agreements with skilled nurs- ing facilities under section 1395cc of this title and shall, where not inconsistent with any pro- vision of this section, impose the same duties, responsibilities, conditions, and limitations, as those imposed under such agreements entered into under section 1395cc of this title; except that no such agreement with any hospital shall be in effect for any period during which the hos- pital does not have in effect an agreement under section 1395cc of this title. A hospital with re- spect to which an agreement under this section has been terminated shall not be eligible to enter into a new agreement until a two-year pe- riod has elapsed from the termination date.