,,ii  #aac? ,,congress  #b;d ,session   
,s4 #bghc  ,,9 ,,! ,,s5ate ,,( ,,!      
,,unit$ ,,/ates  ,septemb] #aj1         
#bjad,mr4 ,?une 7= himself & ,ms4       
,/ab5[7 introduc$ ! foll[+ bill2 :i* 0  
read twice & ref]r$ to ! ,committee on  
,f9ance  ,a ,,bill  ,to e/abli% a       
demon/ration program requir+ !          
utilization ( ,value-,bas$ ,insurance   
,design to demon/rate t r$uc+ !         
copaym5ts or co9surance *>g$ to ,m$ic>e 
b5efici>ies = select$ high-value        
prescription m$ications & cl9ical       
s]vices c increase _! utilization &     
ultimately improve cl9ical outcomes &   
l[] heal? c>e exp5ditures4  #a4 ,%ort   
title ,?is ,act may be cit$ z ! ,value  
,bas$ ,insurance ,design = ,bett] ,c>e  
,act ( #bjad or ! ,,vbid = ,bett] ,c>e  
,act ( #bjad4  #b4 ,f9d+s ,congress     
makes ! foll[+ f9d+s3 7#a7 ,a gr[+ body 
( evid5ce demon/rates t increases 9     
pati5t-level f9ancial b>ri]s 7includ+   
d$uctibles1 copaym5ts1 & co9surance7 =  
high-value m$ical s]vices 7su* z        

prescription m$ications1 cl9ician       
visits1 diagno/ic te/s1 & proc$ures7    
sy/ematically r$uce _! use4 ,sav+s      
attributable to co/-relat$ decreas$     
utilization ( specific s]vices may lead 
to an increase 9 total m$ical           
exp5ditures due to increas$ use ( o!r   
relat$ cl9ical s]vices1 su* z           
hospitalizations & em]g5cy room visits4 
7#b7 ,empirical rese>* /udies demon/rate
 t r$uctions 9 b5efici>y out-(-pocket   
exp5ses = high-value prescription       
m$ications & cl9ical s]vices c mitigate 
! adv]se heal? & f9ancial consequ5ces   
attributable to co/-relat$ decreas$     
utilization ( high-value s]vices4  7#c7 
,f9ancial b>ri]s to prescription        
m$ications & cl9ical s]vices t are deem$
 to be high value %\ld be r$uc$ or      
elim9at$ to increase _! use4  7#d7      
,value-,bas$ ,insurance ,design is a    
me?odology t adju/s pati5t out-(-pocket 
co/s = prescription m$ications & cl9ical
 s]vices accord+ to ! cl9ical value--n  
exclusively ! co/4 ,value-,bas$         

,insurance ,design is bas$ on ! concept 
( cl9ical nuance t recognizes-- 7,a7    
prescription m$ications & cl9ical       
s]vices diff] 9 ! cl9ical b5efit        
provid$2 &  7,b7 ! cl9ical b5efit d]iv$ 
f a specific prescription m$ication or  
cl9ical s]vice dep5ds on ! cl9ical      
situation1 ! provid]1 & :]e ! c>e is    
deliv]$4  7#e7 ,! curr5t                
"o-size-fits-all copaym5t or co9surance 
design = prescription m$ications &      
cl9ical s]vices provid$ "u ! ,m$ic>e    
program does n recognize ! well-e/abli%$
 value diff]5ces 9 heal? outcomes       
produc$ by v>i\s m$ical int]v5tions4    
7#f7 ,! e/abli%m5t by ,m$ic>e ( copaym5t
 & co9surance requirem5ts us+           
,value-,bas$ ,insurance ,design         
me?odologies w improve pati5t-c5t]$     
heal? outcomes1 enhance p]sonal         
responsibility1 & af=d a m effici5t use 
( taxpay] doll>s4  #c4 ,demon/ration    
program  7a7 ,9 g5]al ,! ,secret>y (    
,heal? & ,human ,s]vices 79 ?is section 
ref]r$ to z ! ,secret>y7 %all e/abli% a 

#c-ye> demon/ration program to te/ ! use
 ( value-bas$ insurance design          
me?odologies 7z def9$ 9 subsection      
7c77#a77 "u eligible ,m$ic>e ,advantage 
plans (f]$ by ,m$ic>e ,advantage        
organizations "u "p ,c ( title ,,xviii (
 ! ,social ,security ,act 7#db ,u4,s4,c4
 #aciew-#ba et seq474  7b7 ,demon/ration
 program design  7#a7 ,selection ( ,,ma 
region & eligible ,m$ic>e ,advantage    
plans ,! ,secret>y %all-- 7,a7 select at
 lea/ two ,,ma regions 7z def9$ 9       
section #aheh7;a77#b7 ( ! ,social       
,security ,act 7#db ,u4,s4,c4           
#aciew-#bg;a7a77#b777 ) respect to :i*  
to conduct ! demon/ration program "u ?is
 section2 &  7,b7 approve eligible      
,m$ic>e ,advantage plans to p>ticipate 9
 su* demon/ration program4  7#b7 ,/>t ( 
demon/ration ,! demon/ration program    
%all beg9 ) respect to ! fir/ plan ye>  
beg9n+ aft] ! date on :i* at lea/ two   
eligible ,m$ic>e ,advantage plans h be5 
approv$ by ! ,secret>y 9 at lea/ "o ,,ma
 region select$ "u p>agraph 7#a74  7#c7 

,eligible ,m$ic>e ,advantage plans ,=   
purposes ( ?is section1 ! t]m eligible  
,m$ic>e ,advantage plan means a ,m$ic>e 
,advantage plan "u "p ,c ( title ,,xviii
 ( ! ,social ,security ,act 7#db        
,u4,s4,c4 #aciew-#ba et seq47 t meets ! 
foll[+ requirem5ts3 7,a7 ,! plan is an  
,,ma regional plan 7z def9$ 9 p>agraph  
7#d7 ( section #ahei7;b7 ( su* ,act 7#db
 ,u4,s4,c4 #aciew-#bh7;b777 or ,,ma     
local plan 7z def9$ 9 p>agraph 7#e7 (   
su* section7 (f]$ 9 ! ,,ma region       
select$ "u p>agraph 7#a77;,a74  7,b7 ,! 
plan has-- 7i7 a quality rat+ "u section
 #ahec7n77#d7 ( su* ,act 7#db ,u4,s4,c4 
#aciew-#bc7n77#d77 ( #d />s or high]    
bas$ on ! mo/ rec5t data available = su*
 ye>2  7ii7 9 ! case ( a specializ$ ,,ma
 plan = special ne$s individuals1 z     
def9$ 9 subsection 7b77#f77;,a7 (       
section #ahei7;b77#f77;,a7 ( su* ,act   
7#db ,u4,s4,c4 #aciew-#bh7;b77#f77;,a771
 receiv$ a multi-ye> approval by !      
,national ,committee = ,quality         
,assurance "u subsection 7f77#g7 ( su*  

section2 or  7iii7 at lea/ #bj p]c5t ( !
 population to :om ! plan is (f]$       
consi/s ( subsidy eligible individuals  
7z def9$ 9 section                      
#ahfj;,d-#ad7;a77#c77;,a7 ( ! ,social   
,security ,act 7#db ,u4,s4,c4           
#aciew-#aad7;a77#c77;,a7774  7c7        
,value-,bas$ insurance design           
me?odologies  7#a7 ,def9ition ,=        
purposes ( ?is section1 ! t]m value-bas$
 insurance design me?odology means a    
me?odology = id5tify+ specific          
prescription m$ications1 & cl9ical      
s]vices t are reimbursable "u title     
,,xviii ( ! ,social ,security ,act1 =   
:i* copaym5ts1 co9surance1 or bo? %\ld  
be r$uc$ or elim9at$ because ( ! high   
value & effectiv5ess ( su* m$ications & 
s]vices = specific *ronic cl9ical       
conditions 7z approv$ by ! ,secret>y74  
7#b7 ,use ( me?odologies to r$uce       
copaym5ts & co9surance ,a ,m$ic>e       
,advantage organization (f]+ an eligible
 ,m$ic>e ,advantage plan select$ to     
p>ticipate "u ! demon/ration program1 = 

ea* plan ye> = :i* ! plan is s select$ &
 us+ value-bas$ insurance design        
me?odologies-- 7,a7 %all id5tify ea*    
prescription m$ication & cl9ical s]vice 
cov]$ "u su* plan = :i* ! am\nt ( !     
copaym5t or co9surance %\ld be r$uc$ or 
elim9at$1 ) respect to ! managem5t (    
specific *ronic cl9ical conditions 7z   
specifi$ by ! ,secret>y7 ( ,,ma eligible
 individuals 7z def9$ 9 section         
#ahea7;a77#c7 ( ! ,social ,security ,act
 7#db ,u4,s4,c4 #aciew-#ba7;a77#c777    
enroll$ "u su* plans1 = su* plan ye>2 & 
7,b7 may1 = su* plan ye>1 r$uce or      
elim9ate copaym5ts1 co9surance1 or bo? =
 su* prescription m$ication & cl9ical   
s]vices s id5tifi$ ) respect to !       
managem5t ( su* conditions ( su*        
individuals-- 7i7 if su* r$uction or    
elim9ation is evid5ce-bas$1 = ! purpose 
( enc\rag+ su* individuals 9 su* plan to
 use su* prescription m$ications &      
cl9ical s]vices 7su* z prev5tive c>e1   
prim>y c>e1 specialty visits1 diagno/ic 
te/s1 proc$ures1 & durable m$ical       

equipm5t7 ) respect to su* conditions2 &
  7ii7 = ! purpose ( enc\rag+ su*       
individuals 9 su* plan to use heal? c>e 
provid]s t su* organization has id5tifi$
 ) respect to su* plan ye>4  7#c7       
,prohibition ( increases ( copaym5ts &  
co9surance ,9 no case may any ,m$ic>e   
,advantage plan p>ticipat+ 9 !          
demon/ration program increase1 = any    
plan ye> = :i* ! plan is s p>ticipat+1 !
 am\nt ( copaym5ts or co9surance = any  
item or s]vice cov]$ "u su* plan =      
purposes ( disc\rag+ ! use ( su* item or
 s]vice4  7d7 ,report on implem5tation  
7#a7 ,9 g5]al ,n lat] ?an #a ye> aft] ! 
date on :i* ! demon/ration program "u   
?is section beg9s "u subsection 7b77#b71
 ! ,secret>y %all submit to ,congress a 
report on ! /atus ( ! implem5tation ( ! 
demon/ration program4  7#b7 ,elem5ts ,! 
report requir$ by p>agraph 7#a7 %all1 ) 
respect to eligible ,m$ic>e ,advantage  
plans p>ticipat+ 9 ! demon/ration       
program = ! fir/ plan ye> ( su* program1
 include ! foll[+3 7,a7 ,a li/ ( ea*    

m$ication & s]vice id5tifi$ pursuant to 
subsection 7c77#b77;,a7 = su* plan )    
respect to su* plan ye>4  7,b7 ,= ea*   
su* m$ication or s]vice s id5tifi$1 !   
am\nt ( ! copaym5t or co9surance requir$
 "u su* plan ) respect to su* plan ye> =
 su* m$ication or s]vice & ! am\nt ( !  
r$uction ( su* copaym5t or co9surance f 
! previ\s plan ye>4  7,c7 ,= ea* provid]
 id5tifi$ pursuant to subsection        
7c77#b77;,b77ii7 = su* plan ) respect to
 su* plan ye>1 a /atem5t ( ! am\nt ( !  
copaym5t or co9surance requir$ "u su*   
plan ) respect to su* plan ye> & ! am\nt
 ( ! r$uction ( su* copaym5t or         
co9surance f ! previ\s plan ye>4  7e7   
,review & assessm5t ( utilization (     
value-,bas$ insurance design            
me?odologies  7#a7 ,9 g5]al ,! ,secret>y
 %all ent] into a contract or agreem5t )
 an indep5d5t1 non-bias$ entity hav+    
exp]tise 9 value-bas$ insurance design  
me?odologies to review & assess !       
implem5tation ( ! demon/ration program  
"u ?is section4 ,! review & assessm5t   

%all include ! foll[+3 7,a7 ,an         
assessm5t ( ! utilization ( value-bas$  
insurance design me?odologies by ,m$ic>e
 ,advantage plans p>ticipat+ "u su*     
program4  7,b7 ,an analysis ( :e!r r$uc+
 or elim9at+ ! copaym5t or co9surance = 
ea* m$ication & cl9ical s]vice id5tifi$ 
pursuant to subsection 7c77#b77;,a7     
result$ 9 increas$ adh]5ce to m$ication 
regim5s1 increas$ s]vice utilization1   
improvem5t 9 quality metrics1 bett]     
heal? outcomes1 & enhanc$ b5efici>y     
exp]i5ce4  7,c7 ,an analysis ( ! ext5t  
to :i* co/s to ,m$ic>e ,advantage plans 
"u "p ,c ( title ,,xviii ( ! ,social    
,security ,act p>ticipat+ 9 !           
demon/ration program is less ?an co/s to
 ,m$ic>e ,advantage plans "u su* "p t   
are n p>ticipat+ 9 ! demon/ration       
program4  7,d7 ,an analysis ( :e!r r$uc+
 or elim9at+ ! copaym5t or co9surance = 
provid]s id5tifi$ pursuant to subsection
 7c77#b77;,b77ii7 result$ 9 improvem5t 9
 quality metrics1 bett] heal? outcomes1 
& enhanc$ b5efici>y exp]i5ce4  7,e7 ,an 

analysis1 = ea* provid] s id5tifi$1 !   
ext5t to :i* co/s to ,m$ic>e ,advantage 
plans "u "p ,c ( title ,,xviii ( !      
,social ,security ,act p>ticipat+ 9 !   
demon/ration program is less ?an co/s to
 ,m$ic>e ,advantage plans "u su* "p t   
are n p>ticipat+ 9 ! demon/ration       
program4  7,f7 ,su* o!r matt]s1 z !     
,secret>y consid]s appropriate4  7#b7   
,report ,! contract or agreem5t ent]$   
into "u p>agraph 7#a7 %all require su*  
entity to submit to ! ,secret>y a report
 on ! review & assessm5t conduct$ by !  
entity "u su* p>agraph 9 "t = !         
inclusion ( ! results ( su* report 9 !  
report requir$ by p>agraph 7#c74  7#c7  
,report to ,congress ,n lat] ?an #c ye>s
 aft] ! date on :i* ! demon/ration      
program beg9s "u subsection 7b77#b71 !  
,secret>y %all submit to ,congress a    
report on ! review & assessm5t ( !      
demon/ration program conduct$ "u ?is    
subsection4 ,! report %all include !    
foll[+3 7,a7 ,a description ( ! results 
( ! review & assessm5t includ$ 9 !      

report submitt$ pursuant to p>agraph    
7#b74  7,b7 ,su* recomm5dations z !     
,secret>y consid]s appropriate = enhanc+
 ! utilization ( ! me?odologies appli$  
"u ! demon/ration program to all ,m$ic>e
 ,advantage plans "u "p ,c ( title      
,,xviii ( ! ,social ,security ,act s z  
to r$uce copaym5ts & co9surance "u su*  
plans paid by ,m$ic>e b5efici>ies =     
high-value prescription m$ications &    
cl9ical s]vices = :i* cov]age is provid$
 "u su* plans & to o!rwise improve !    
quality ( heal? c>e provid$ "u su*      
plans4  7f7 ,expansion ( demon/ration   
program ,! ,secret>y %all exp& !        
demon/ration program1 pursuant to notice
 & comm5t rulemak+1 to implem5t1 on a   
p]man5t basis1 ! compon5ts ( !          
demon/ration program t are b5eficial to 
,m$ic>e b5efici>ies & ! ,m$ic>e program1
 unless ! report "u subsection 7d7 or   
7e77#c7 conta9s an evaluation t !       
demon/ration program-- 7#a7 increases   
exp5ditures "u title ,,xviii ) respect  
to ,m$ic>e b5efici>ies p>ticipat+ 9 !   

demon/ration program2 or  7#b7 decreases
 ! quality ( heal? c>e s]vices furni%$  
to su* ,m$ic>e b5efici>ies p>ticipat+ 9 
! demon/ration program4  7g7 ,waiv]     
au?ority ,! ,secret>y may waive su*     
provisions ( titles ,,xi & ,,xviii ( !  
,social ,security ,act z may be necess>y
 to c>ry out ! demon/ration program "u  
?is section4  7h7 ,implem5tation fund+  
,= purposes ( c>ry+ out ! demon/ration  
program "u ?is section1 ! ,secret>y %all
 provide = ! transf] f ! ,f$]al         
,hospital ,insurance ,tru/ ,fund "u     
section #ahag ( ! ,social ,security ,act
 7#db ,u4,s4,c4 #acie;i7 & ! ,f$]al     
,supplem5t>y ,insurance ,tru/ ,fund "u  
section #ahda ( ! ,social ,security ,act
 7#db ,u4,s4,c4 #aciet71 includ+ !      
,m$ic>e ,prescription ,drug ,acc\nt 9   
su* ,tru/ ,fund1 9 su* proportion z     
det]m9$ appropriate by ! ,secret>y1 (   
su* sums z may be necess>y4