114 STAT. 2763A-510 PUBLIC LAW 106-554—APPENDIX F "(1) IN GENERAL.— The Secretary is authorized to establish criteria for health care groups eligible to participate in a demonstration under this section, including criteria relating to numbers of health care professionals in, and of patients served by, the group, scope of services provided, and quality of care. "(2) PAYMENT METHOD. —^A health care group participating in the demonstration under this section shall agree with respect to services furnished to beneficiaries within the scope of the demonstration (as determined under subsection (c))— "(A) to be paid on a fee-for-service basis; and "(B) that payment with respect to all such services furnished by members of the health care group to such beneficiaries shall (where determined appropriate by the Secretary) be made to a single entity. "(3) DATA REPORTING.—^A health care group participating in a demonstration under this section shall report to the Secretary such data, at such times and in such format as the Secretary requires, for purposes of monitoring and evaluation of the demonstration under this section. "(c) PATIENTS WITHIN SCOPE OF DEMONSTRATION.— "(1) IN GENERAL.—The Secretary shall specify, in accordance with this subsection, the criteria for identifying those patients of a health care group who shall be considered within the scope of the demonstration under this section for purposes of application of subsection (d) and for assessment of the effectiveness of the group in achieving the objectives of this section. " (2) OTHER CRITERL\.— The Secretary may establish additional criteria for inclusion of beneficiaries within a demonstration under this section, which may include frequency of contact with physicians in the group or other factors or criteria that the Secretary finds to be appropriate. "(3) NOTICE REQUIREMENTS.— In the case of each beneficiary determined to be within the scope of a demonstration under this section with respect to a specific health care group, the Secretary shall ensure that such beneficiary is notified of the incentives, and of any waivers of coverage or payment rules, applicable to such group under such demonstration. " (d) INCENTIVES.— "(1) PERFORMANCE TARGET.— The Secretary shall establish for each health care group participating in a demonstration under this section— "(A) a base expenditure amount, equal to the average total payments under parts A and B for patients served by the health care group on a fee-for-service basis in a base period determined by the Secretary; and "(B) an Einnual per capita expenditure target for patients determined to be within the scope of the demonstration, reflecting the base expenditure amount adjusted for risk and expected growth rates. "(2) INCENTIVE BONUS.— The Secretary shall pay to each participating health care group (subject to paragraph (4)) a bonus for each year under the demonstration equal to a portion of the medicare savings realized for such year relative to the performance target. " (3) ADDITIONAL BONUS FOR PROCESS AND OUTCOME IMPROVEMENTS. —At such time as the Secretary has established
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