Ill STAT. 302 PUBLIC LAW 105-33 —AUG. 5, 1997 "(D) for 2001, the 'area-specific percentage' is 66 percent and the 'national percentage' is 34 percent, "(E) for 2002, the 'area-specific percentage' is 58 percent and the 'national percentage' is 42 percent, and "(F) for a year after 2002, the 'area-specific percentage' is 50 percent and the 'national percentage' is 50 percent. "(3) ANNUAL AREA-SPECIFIC MEDICARE+CHOICE CAPITATION RATE. — "(A) IN GENERAL.— For purposes of paragraph (1)(A), subject to subparagraph (B), the annual area-specific Medicare+Choice capitation rate for a Medicare+Choice payment area— "(i) for 1998 is, subject to subparagraph (D), the annual per capita rate of pa5anent for 1997 determined under section 1876(a)(1)(C) for the area, increased by the national per capita Medicare-i -Choice growth percentage for 1998 (described in paragraph (6)(A)); or "(ii) for a subsequent year is the annual areaspecific Medicare+Choice capitation rate for the previous year determined under this paragraph for the area, increased by the national per capita Medicare+Choice growth percentage for such subsequent year. " (B) REMOVAL OF MEDICAL EDUCATION FROM CALCULA- TION OF ADJUSTED AVERAGE PER CAPITA COST.— "(i) IN GENERAL.—In determining the area-specific Medicare+Choice capitation rate under subparagraph (A) for a year (beginning with 1998), the annual per capita rate of payment for 1997 determined under section 1876(a)(1)(C) shall be adjusted to exclude from the rate the applicable percent (specified in clause (ii)) of the payment adjustments described in subparagraph (C). "(ii) APPLICABLE PERCENT.;—For purposes of clause (i), the applicable percent for— "(I) 1998 is 20 percent, " (II) 1999 is 40 percent, " (III) 2000 is 60 percent, "(IV) 2001 is 80 percent, and "(V) a succeeding year is 100 percent. "(C) PAYMENT ADJUSTMENT.— "(i) IN GENERAL. — Subject to clause (ii), the pay- ment adjustments described in this subparagraph are payment adjustments which the Secretary estimates were payable during 1997— "(I) for the indirect costs of medical education under section 1886(d)(5)(B), and "(II) for direct graduate medical education costs under section 1886(h). "(ii) TREATMENT OF PAYMENTS COVERED UNDER STATE HOSPITAL REIMBURSEMENT SYSTEM. —TO the extent that the Secretary estimates that an annual per capita rate of payment for 1997 described in clause (i) reflects payments to hospitals reimbursed under section 1814(b)(3), the Secretary shall estimate a pay- ment adjustment that is comparable to the payment
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