AUTHORITY TO DENY PLAN BIDS.

SEC. 3209. AUTHORITY TO DENY PLAN BIDS. (a) In General.—Section 1854(a)(5) of the Social Security Act (42 U.S.C. 1395w–24(a)(5)) is amended by adding at the end the following new subparagraph: “(C) Rejection of bids.— “(i) In general.—Nothing in this section shall be construed as requiring the Secretary to accept any or every bid submitted by an MA organization under this subsection. “(ii) Authority to deny bids that propose significant increases in cost sharing or decreases in benefits.—The Secretary may deny a bid submitted by an MA organization for an MA plan if it proposes significant increases in cost sharing or decreases in benefits offered under the plan.” . (b) Application Under Part D.—Section 1860D–11(d) of such Act (42 U.S.C. 1395w–111(d)) is amended by adding at the end the following new paragraph: “(3) Rejection of bids.—Paragraph (5)(C) of section 1854(a) shall apply with respect to bids submitted by a PDP sponsor under subsection (b) in the same manner as such paragraph applies to bids submitted by an MA organization under such section 1854(a).” . (c) [42 U.S.C. 1395w–24 note] Effective Date.—The amendments made by this section shall apply to bids submitted for contract years beginning on or after January 1, 2011.