[Code of Federal Regulations]
[Title 42, Volume 2]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR422.4]

[Page 832-833]
 
                         TITLE 42--PUBLIC HEALTH
 
                             HUMAN SERVICES
 
PART 422--MEDICARE+CHOICE PROGRAM--Table of Contents
 
                      Subpart A--General Provisions
 
Sec. 422.4  Types of M+C plans.

    (a) General rule. An M+C plan may be a coordinated care plan, a 
combination of an M+C MSA plan and a contribution into an M+C MSA 
established in accordance with Sec. 422.262, or an M+C private fee-for-
service plan.
    (1) A coordinated care plan. A coordinated care plan is a plan that 
includes a network of providers that are under contract or arrangement 
with the organization to deliver the benefit package approved by CMS.
    (i) The network is approved by CMS to ensure that all applicable 
requirements are met, including access and availability, service area, 
and quality.
    (ii) Coordinated care plans may include mechanisms to control 
utilization, such as referrals from a gatekeeper for an enrollee to 
receive services within the plan, and financial arrangements that offer 
incentives to providers to furnish high quality and cost-effective care.
    (iii) Coordinated care plans include plans offered by health 
maintenance organizations (HMOs), provider-sponsored organizations 
(PSOs), preferred provider organizations (PPOs) as specified in 
paragraph (a)(1)(iv) of this section, RFBs, and other network plans 
(except network MSA plans).
    (iv) A PPO plan is a plan that has a network of providers that have 
agreed to a contractually specified reimbursement for covered benefits 
with the organization offering the plan; provides for reimbursement for 
all covered benefits regardless of whether the benefits are provided 
within the network of providers; and is offered by an organization that 
is not licensed or organized under State law as an HMO.
    (2) A combination of an M+C MSA plan and a contribution into the M+C 
MSA established in accordance with Sec. 422.262. (i) M+C MSA plan means 
a plan that--
    (A) Pays at least for the services described in Sec. 422.101, after 
the enrollee has incurred countable expenses (as specified in the plan) 
equal in amount to the annual deductible specified in Sec. 422.103(d); 
and
    (B) Meets all other applicable requirements of this part.
    (ii) An M+C MSA plan may be either a network plan or a non-network 
plan.
    (A) M+C network MSA plan means an MSA plan under which enrollees 
must receive services through a defined provider network that is 
approved by CMS to ensure that all applicable requirements are met, 
including access and availability, service area, and quality.
    (B) M+C non-network MSA plan means an MSA plan under which enrollees 
are not required to receive services through a provider network.
    (iii) M+C MSA means a trust or custodial account--
    (A) That is established in conjunction with an MSA plan for the 
purpose of paying the qualified expenses of the account holder; and
    (B) Into which no deposits are made other than contributions by CMS 
under the M+C program, or a trustee-to-trustee transfer or rollover from 
another M+C MSA of the same account holder, in accordance with the 
requirements of sections 138 and 220 of the Internal Revenue Code.
    (3) M+C private fee-for-service plan. An M+C private fee-for-service 
plan is an M+C plan that--

[[Page 833]]

    (i) Pays providers of services at a rate determined by the plan on a 
fee-for-service basis without placing the provider at financial risk;
    (ii) Does not vary the rates for a provider based on the utilization 
of that provider's services; and
    (iii) Does not restrict enrollees' choices among providers that are 
lawfully authorized to provide services and agree to accept the plan's 
terms and conditions of payment.
    (b) Multiple plans. Under its contract, an M+C organization may 
offer multiple plans, regardless of type, provided that the M+C 
organization is licensed or approved under State law to provide those 
types of plans (or, in the case of a PSO plan, has received from CMS a 
waiver of the State licensing requirement). If an M+C organization has 
received a waiver for the licensing requirement to offer a PSO plan, 
that waiver does not apply to the licensing requirement for any other 
type of M+C plan.

[63 FR 35068, June 26, 1998, as amended at 65 FR 40315, June 29, 2000]