Title I, SEC. 1351. PAYMENT TO REGIONAL ALLIANCE HEALTH PLANS. (a) Computation of Blended Plan Per Capita Payment Amount. For purposes of making payments to plans under this section, each regional alliance shall compute, under section 6201(a), a blended plan per capita payment amount for each regional alliance health plan for enrollment in the alliance for a year. (b) Amount of Payment to Plans. (1) In general. Subject to subsection (e) and section 6121(b)(5)(B), each regional alliance shall provide for payment to each regional alliance health plan, in which an alliance eligible individual is enrolled, an amount equal to the net blended rate (described in paragraph (2)) adjusted (consistent with subsection (c)) to take into account the relative actuarial risk associated with the coverage with respect to the individual. (2) Net blended rate. The net blended rate described in this paragraph is the blended plan per capita payment amount (determined under section 6201(a)), reduced by (A) the consolidated set aside percentage specified under subsection (d), and (B) any plan payment reduction imposed under section 6011 for the plan for the year. (c) Application of Risk Adjustment and Reinsurance Methodology. Each regional alliance shall use the risk adjustment methodology developed under section 1541 in making payments to regional alliance health plans under this section, except as provided in section 1542. (d) Consolidated Set Aside Percentage. The consolidated set aside percentage, for a regional alliance for a year, is the sum of (1) the administrative allowance percentage for the regional alliance, computed by the alliance under section 1352(b); and (2) 1.5 percentage points. Amounts attributable to paragraph (2) are paid to the Federal Government (for academic health centers and graduate medical education) under section 1353. (e) Treatment of Veterans, Military, and Indian Health Plans and Programs. (1) Veterans health plan. In applying this subtitle (and title VI) in the case of a regional alliance health plan that is a veterans health plan of the Department of Veterans Affairs, the following rules apply: (A) For purposes of applying subtitle A of title VI, families enrolled under the plan shall not be taken into account. (B) The provisions of subtitle A of title VI shall not apply to the plan, other than such provisions as require the plan to submit a per capita amount for each regional alliance area on a timely basis, which amount shall be treated as the final accepted bid of the plan for the area for purposes of subtitle B of such title and this section. This amount shall not be subject to negotiation and not subject to reduction under section 6011. (C) For purposes of computing the blended plan per capita payment amount under this section, the AFDC and SSI proportions (under section 6202(a)) are deemed to be 0 percent. (2) Uniformed services health plan. In applying this subtitle (and title VI) in the case of a regional alliance health plan that is a Uniformed Services Health Plan of the Department of Defense, the following rules apply: (A) For purposes of applying subtitle A of title VI, families enrolled under the plan shall not be taken into account. (B) The provisions of subtitle A of title VI shall not apply to the plan, other than such provisions as require the plan to submit a per capita amount on a timely basis, which amount shall be treated as the final accepted bid of the plan for the area involved for purposes of subtitle B of such title and this section. This amount shall not be subject to negotiation and not subject to reduction under section 6011. The Board, in consultation with the Secretary of Defense, shall establish rules relating to the area (or areas) in which such a bid shall apply. (C) For purposes of computing the blended plan per capita payment amount under this section, the AFDC and SSI proportions (under section 6202(a)) are deemed to be 0 percent. (3) Indian health programs. In applying this subtitle (and title VI) in the case of a health program of the Indian Health Service, the following rules apply: (A) Except as provided in this paragraph, the plan shall not be considered or treated to be a regional alliance health plan and for purposes of applying title VI, families enrolled under the program shall not be taken into account. (B) In accordance with rules established by the Secretary, regional alliances shall act as agents for the collection of employer premium payments (including payments of corporate alliance employers) required under subtitle B of title VI with respect to qualifying employees who are enrolled under a health program of the Indian Health Service. The Secretary shall permit such alliances to retain a nominal fee to compensate them for such collection activities. In applying this subparagraph, the family share of premium for such employees is deemed to be zero for electing Indians (as defined in section 1012(d)(3)) and for other employees is the amount of the premium established under section 8306(b)(4)(A), employees are deemed to be residing in the area of residence (or area of employment), as specified under rules of the Secretary, and the class of enrollment shall be such class (or classes) as specified under rules of the Secretary.