117 STAT. 2116
PUBLIC LAW 108–173—DEC. 8, 2003
made under this part that would have been made if the Secretary had not applied such adjustment. ‘‘(d) PAYMENT METHODS.— ‘‘(1) IN GENERAL.—Payments under this section shall be based on such a method as the Secretary determines. The Secretary may establish a payment method by which interim payments of amounts under this section are made during a year based on the Secretary’s best estimate of amounts that will be payable after obtaining all of the information. ‘‘(2) REQUIREMENT FOR PROVISION OF INFORMATION.— ‘‘(A) REQUIREMENT.—Payments under this section to a PDP sponsor or MA organization are conditioned upon the furnishing to the Secretary, in a form and manner specified by the Secretary, of such information as may be required to carry out this section. ‘‘(B) RESTRICTION ON USE OF INFORMATION.—Information disclosed or obtained pursuant to subparagraph (A) may be used by officers, employees, and contractors of the Department of Health and Human Services only for the purposes of, and to the extent necessary in, carrying out this section. ‘‘(3) SOURCE OF PAYMENTS.—Payments under this section shall be made from the Medicare Prescription Drug Account. ‘‘(4) APPLICATION OF ENROLLEE ADJUSTMENT.—The provisions of section 1853(a)(2) shall apply to payments to PDP sponsors under this section in the same manner as they apply to payments to MA organizations under section 1853(a). ‘‘(e) PORTION OF TOTAL PAYMENTS TO A SPONSOR OR ORGANIZATION SUBJECT TO RISK (APPLICATION OF RISK CORRIDORS).— ‘‘(1) COMPUTATION OF ADJUSTED ALLOWABLE RISK CORRIDOR COSTS.— ‘‘(A) IN GENERAL.—For purposes of this subsection, the term ‘adjusted allowable risk corridor costs’ means, for a plan for a coverage year (as defined in subsection (b)(4))— ‘‘(i) the allowable risk corridor costs (as defined in subparagraph (B)) for the plan for the year, reduced by ‘‘(ii) the sum of (I) the total reinsurance payments made under subsection (b) to the sponsor of the plan for the year, and (II) the total subsidy payments made under section 1860D–14 to the sponsor of the plan for the year. ‘‘(B) ALLOWABLE RISK CORRIDOR COSTS.—For purposes of this subsection, the term ‘allowable risk corridor costs’ means, with respect to a prescription drug plan offered by a PDP sponsor or an MA–PD plan offered by an MA organization, the part of costs (not including administrative costs, but including costs directly related to the dispensing of covered part D drugs during the year) incurred by the sponsor or organization under the plan that are actually paid (net of discounts, chargebacks, and average percentage rebates) by the sponsor or organization under the plan, but in no case more than the part of such costs that would have been paid under the plan if the prescription drug coverage under the plan were basic prescription drug coverage, or, in the case of a plan providing supplemental prescription drug coverage, if such coverage were basic
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