[Code of Federal Regulations] [Title 42, Volume 3] [Revised as of October 1, 2006] From the U.S. Government Printing Office via GPO Access [CITE: 42CFR422.2] [Page 231-234] TITLE 42--PUBLIC HEALTH CHAPTER IV--CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES PART 422_MEDICARE ADVANTAGE PROGRAM--Table of Contents Subpart A_General Provisions Sec. 422.2 Definitions. As used in this part-- Arrangement means a written agreement between an MA organization and a provider or provider network, under which-- (1) The provider or provider network agrees to furnish for a specific MA plan(s) specified services to the organization's MA enrollees; (2) The organization retains responsibilities for the services; and (3) Medicare payment to the organization discharges the enrollee's obligation to pay for the services. Balance billing generally refers to an amount billed by a provider that represents the difference between the amount the provider charges an individual for a service and the sum of the amount the individual's health insurer (for example, the original Medicare program) will pay for the service plus any cost-sharing by the individual. Basic benefits means all Medicare-covered benefits (except hospice services). Benefits means health care services that are intended to maintain or improve the health status of enrollees, for which the MA organization incurs a cost or liability under an MA plan (not solely an administrative processing cost). Benefits are submitted and approved through the annual bidding process. Coinsurance is a fixed percentage of the total amount paid for a health care service that can be charged to an MA enrollee on a per- service basis. Copayment is a fixed amount that can be charged to an MA plan enrollee on a per-service basis. Cost-sharing includes deductibles, coinsurance, and copayments. [[Page 232]] Institutionalized means for the purpose of defining a special needs individual, an MA eligible individual who continuously resides or is expected to continuously reside for 90 days or longer in a long-term care facility which is a skilled nursing facility (SNF) nursing facility (NF); SNF/NF; an intermediate care facility for the mentally retarded (ICF/MR); or an inpatient psychiatric facility. Licensed by the State as a risk-bearing entity means the entity is licensed or otherwise authorized by the State to assume risk for offering health insurance or health benefits coverage, such that the entity is authorized to accept prepaid capitation for providing, arranging, or paying for comprehensive health services under an MA contract. MA stands for Medicare Advantage. MA local area is defined in Sec. 422.252. MA local plan means an MA plan that is not an MA regional plan. MA-Prescription drug (PD) plan means an MA plan that provides qualified prescription drug coverage under Part D of the Social Security Act. MA regional plan means a coordinated care plan structured as a preferred provider organization (PPO) that serves one or more entire regions. An MA regional plan must have a network of contracting providers that have agreed to a specific reimbursement for the plan's covered services and must pay for all covered services whether provided in or out of the network. MA eligible individual means an individual who meets the requirements of Sec. 422.50. MA organization means a public or private entity organized and licensed by a State as a risk-bearing entity (with the exception of provider-sponsored organizations receiving waivers) that is certified by CMS as meeting the MA contract requirements. MA plan means health benefits coverage offered under a policy or contract by an MA organization that includes a specific set of health benefits offered at a uniform premium and uniform level of cost-sharing to all Medicare beneficiaries residing in the service area of the MA plan (or in individual segments of a service area, under Sec. 422.304(b)(2)). MA plan enrollee is an MA eligible individual who has elected an MA plan offered by an MA organization. Mandatory supplemental benefits means health care services not covered by Medicare that an MA enrollee must accept or purchase as part of an MA plan. The benefits may include reductions in cost sharing for benefits under the original Medicare fee for service program and are paid for in the form of premiums and cost sharing, or by an application of the beneficiary rebate rule in section 1854(b)(1)(C)(ii)(I) of the Act, or both. MSA stands for medical savings account. MSA trustee means a person or business with which an enrollee establishes an MA MSA. A trustee may be a bank, an insurance company, or any other entity that-- (1) Is approved by the Internal Revenue Service to be a trustee or custodian of an individual retirement account (IRA); and (2) Meets the requirements of Sec. 422.262(b). National coverage determination (NCD) means a national policy determination regarding the coverage status of a particular service that CMS makes under section 1862(a)(1) of the Act, and publishes as a Federal Register notice or CMS ruling. (The term does not include coverage changes mandated by statute.) Optional supplemental benefits are health services not covered by Medicare that are purchased at the option of the MA enrollee and paid for in full, directly by (or on behalf of) the Medicare enrollee, in the form of premiums or cost-sharing. These services may be grouped or offered individually. Original Medicare means health insurance available under Medicare Part A and Part B through the traditional fee-for service payment system. Point of service (POS) is a benefit option that an MA coordinated care plan can offer to its Medicare enrollees as an additional, mandatory supplemental, or optional supplemental benefit. Under the POS benefit option, the MA plan allows members the option of receiving specified services outside of [[Page 233]] the MA plan's provider network. In return for this flexibility, members typically have higher cost-sharing requirements for services received and, where offered as a mandatory or optional supplemental benefit, may also be charged a premium for the POS benefit option. Prescription drug plan (PDP). PDP has the definition set forth in Sec. 423.4 of this chapter. Prescription drug plan (PDP) sponsor. A prescription drug plan sponsor has the definition set forth in Sec. 423.4 of this chapter. Provider means-- (1) Any individual who is engaged in the delivery of health care services in a State and is licensed or certified by the State to engage in that activity in the State; and (2) Any entity that is engaged in the delivery of health care services in a State and is licensed or certified to deliver those services if such licensing or certification is required by State law or regulation. Provider network means the providers with which an MA organization contracts or makes arrangements to furnish covered health care services to Medicare enrollees under an MA coordinated care plan or network PFFS plan. Religious Fraternal benefit (RFB) society means an organization that-- (1) Is described in section 501(c)(8) of the Internal Revenue Code of 1986 and is exempt from taxation under section 501(a) of that Act; and (2) Is affiliated with, carries out the tenets of, and shares a religious bond with, a church or convention or association of churches or an affiliated group of churches. RFB plan means an MA plan that is offered by an RFB society. Service area means a geographic area that for local MA plans is a county or multiple counties, and for MA regional plans is a region approved by CMS within which an MA-eligible individual may enroll in a particular MA plan offered by an MA organization. Each MA plan must be available to all MA-eligible individuals within the plan's service area. In deciding whether to approve an MA plan's proposed service area, CMS considers the following criteria: (1) For local MA plans: (i) Whether the area meets the ``county integrity rule'' that a service area generally consists of a full county or counties. (ii) However, CMS may approve a service area that includes only a portion of a county if it determines that the ``partial county'' area is necessary, nondiscriminatory, and in the best interests of the beneficiaries. CMS may also consider the extent to which the proposed service area mirrors service areas of existing commercial health care plans or MA plans offered by the organization. (2) For all MA coordinated care plans, whether the contracting provider network meets the access and availability standards set forth in Sec. 422.112. Although not all contracting providers must be located within the plan's service area, CMS must determine that all services covered under the plan are accessible from the service area. (3) For MA regional plans, whether the service area consists of the entire region. Special needs individual means an MA eligible individual who is institutionalized, as defined above, is entitled to medical assistance under a State plan under title XIX, or has a severe or disabling chronic condition(s) and would benefit from enrollment in a specialized MA plan. Specialized MA Plans for Special Needs Individuals means a MA coordinated care plan that exclusively enrolls or enrolls a disproportionate percentage of special needs individuals as set forth in Sec. 422.4(a)(1)(iv) and that, beginning January 1, 2006, provides Part D benefits under part 423 of this chapter to all enrollees; and which has been designated by CMS as meeting the requirements of a MA SNP as determined on a case-by-case basis using criteria that include the appropriateness of the target population, the existence of clinical programs or special expertise to serve the target population, and whether the proposal discriminates [[Page 234]] against sicker members of the target population. [63 FR 35068, June 26, 1998, as amended at 65 FR 40314, June 29, 2000; 68 FR 50855, Aug. 22, 2003; 70 FR 4714, Jan. 28, 2005; 70 FR 52026, Sept. 1, 2005; 70 FR 76197, Dec. 23, 2005]