PUBLIC LAW 105-33—AUG. 5, 1997 111 STAT. 533 organization under section 1853 (or, for periods beginning before January 1, 1999, to an eligible organization under a risk-sharing contract under section 1876). Such payments shall be subject to adjustment in the manner described in section 1853(a)(2) or section 1876(a)(1)(E), as the case may be. "(2) CAPITATION AMOUNT.— The capitation amount to be applied under this subsection for a provider for a contract year shall be an amount specified in the PACE program agreement for the year. Such amount shall be based upon payment rates established for purposes of payment under section 1853 (or, for periods before January 1, 1999, for purposes of risksharing contracts under section 1876) and shall be adjusted to take into account the comparative frailty of PACE enrollees and such other factors as the Secretary determines to be appropriate. Such amount under such an agreement shall be computed in a manner so that the total payment level for all PACE program eligible individuals enrolled under a program is less than the projected payment under this title for a comparable population not enrolled under a PACE program. "(e) PACE PROGRAM AGREEMENT. — " (1) REQUIREMENT. — "(A) IN GENERAL.— The Secretary, in close cooperation Procedures, with the State administering agency, shall establish procedures for entering into, extending, and terminating PACE program agreements for the operation of PACE programs by entities that meet the requirements for a PACE provider under this section, section 1934, and regulations. " (B) NUMERICAL LIMITATION.— "(i) IN GENERAL. — The Secretary shall not permit the number of PACE providers with which agreements are in effect under this section or under section 9412(b) of the Omnibus Budget Reconciliation Act of 1986 to exceed— "(I) 40 as of the date of the enactment of this section; or "(II) as of each succeeding anniversary of such date, the numerical limitation under this subparagraph for the preceding year plus 20. Subclause (II) shall apply without regard to the actual Applicability, number of agreements in effect as of a previous anniversary date. " (ii) TREATMENT OF CERTAIN PRIVATE, FOR-PROFIT PROVIDERS. —The numerical limitation in clause (i) shall not apply to a PACE provider that— "(I) is operating under a demonstration project waiver under subsection (h); or "(II) was operating under such a waiver and subsequently qualifies for PACE provider status pursuant to subsection (a)(3)(B)(ii). " (2) SERVICE AREA AND ELIGIBILITY.— " (A) IN GENERAL.— A PACE program agreement for a PACE program— "(i) shall designate the service area of the program; "(ii) may provide additional requirements for individuals to qualify as PACE program eligible individuals with respect to the program;
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