Sec. 3. Authority to elect voucher program instead of Medicare part A entitlement
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Section 226 of the Social Security Act ( 42 U.S.C. 426 ) is amended by adding at the end the following new subsections: Notwithstanding the previous provisions of this section, the Secretary shall establish a procedure under which an individual otherwise entitled under subsection
(a)to benefits under part A of title XVIII may waive such entitlement and be automatically enrolled in the Medicare Alternative Voucher Program established under subsection
(l)if— at the time such waiver is made the individual— has a health savings account described in subsection
(d)of section 223 of the Internal Revenue Code of 1986 ( 26 U.S.C. 223 ); and is enrolled under a high deductible health plan, as defined in subsection (c)(1) of such section; and the individual makes such waiver during the initial enrollment period described in section 1837(d). An individual who waives entitlement under paragraph
(1)shall not be treated as entitled to benefits under title XVIII for purposes of section 223(b)(7) of the Internal Revenue Code of 1986. An individual shall not be eligible for benefits under part B or D of title XVIII during the period for which the individual waives entitlement under part A of such title under paragraph (1). The Secretary shall establish a procedure under which an individual who waives entitlement under paragraph
(1)may terminate such waiver during an annual period that shall be the same as the annual general enrollment period described in section 1837(e). For purposes of applying parts B and D of title XVIII, such individual shall be treated as if the individual were entitled to benefits under part A of such title as of the date such individual terminates the waiver under this paragraph. An individual who has terminated such a waiver may not subsequently make such a waiver. The Secretary shall establish a program to be known as the Medicare Alternative Voucher Program (in this subsection referred to as the voucher program ) consistent with this subsection. An individual who waives entitlement under subsection (k)(1) shall be enrolled in the voucher program for the period during which such waiver is in effect. Subject to clause (ii), for each month that an individual within an age cohort is enrolled in the voucher program, the Secretary shall provide a voucher to such individual in an amount that is equal to the monthly actuarial rate for that month computed under section 1818(d)(1) multiplied by the age cohort adjustment factor for such age cohort under subparagraph (B). The amount of a voucher provided to an individual for a month may not exceed $200. For each age cohort the Secretary shall determine an age cohort adjustment factor equal to the ratio of— the monthly actuarial rate described in section 1818(d)(1) as determined by the Secretary for individuals in such age cohort, to the monthly actuarial rate described in such section. For purposes of this paragraph, an age cohort means a group of individuals whose age falls within a span of five consecutive years, consistent with the following: The first such span begins at age 65. Other spans follow consecutively. A voucher under paragraph
(3)may be used only for the following purposes: As a contribution into a health savings account established by such individual, as described in subsection (k)(1)(A). For payment of premiums for enrollment of such individual under a high deductible health plan described in such subsection. If an individual terminates a waiver under subsection (k)(4), the enrollment of such individual in the voucher program shall be terminated on the date on which the termination becomes effective. . Paragraph
(7)of section 223(b) of the Internal Revenue Code of 1986 (relating to Medicare eligible individuals) is amended to read as follows: The limitation under this subsection for any month with respect to an individual shall be zero for any month such individual is entitled to benefits under title XVIII of the Social Security Act. In the case of an individual who is enrolled in the Medicare Alternative Voucher Program under section 226(l) of the Social Security Act, the applicable limitation under subparagraphs
(A)and
(B)of paragraph
(2)shall be increased by the amount of the voucher described in paragraph
(3)of such section which is contributed to a health savings account of such individual. . The amendment made by subsection
(a)shall take effect on the date that is six months after the date of the enactment of this Act and shall apply to an individual who becomes entitled to benefits under part A of title XVIII of the Social Security Act on or after such date of the enactment. The amendment made by subsection
(b)shall apply to months ending after the date referred to in paragraph (1), in taxable years ending after such date.
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Sec. 3
Authority to elect voucher program instead of Medicare part A entitlement
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