Distribution of additional residency positions

(a)

In general

Section 1886(h) of the Social Security Act (42 U.S.C. 1395ww(h)) is amended— (1)in paragraph (4)(F)(i), by striking paragraphs (7) and (8) and inserting paragraphs (7), (8), and (9); (2)in paragraph (4)(H)(i), by striking paragraphs (7) and (8) and inserting paragraphs (7), (8), and (9); (3)in paragraph (7)(E), by inserting paragraph (9), after paragraph (8),; and (4)by adding at the end the following new paragraph:

(9)

Distribution of additional residency positions

(A)

Additional residency positions

(i)

In general

For each of fiscal years 2015 through 2019 (and succeeding fiscal years if the Secretary determines that there are additional residency positions available to distribute under clause (iv)(II)), the Secretary shall, subject to clause (ii) and subparagraph (D), increase the otherwise applicable resident limit for each qualifying hospital that submits a timely application under this subparagraph by such number as the Secretary may approve for portions of cost reporting periods occurring on or after July 1 of the fiscal year of the increase. (ii)

Number available for distribution

For each such fiscal year, the Secretary shall determine the total number of additional residency positions available for distribution under clause (i) in accordance with the following: (I)

Allocation to hospitals already operating over resident limit

One-third of such number shall be available for distribution only to hospitals described in subparagraph (B). (II)

Aggregate limitation

Except as provided in clause (iv)(I), the aggregate number of increases in the otherwise applicable resident limit under this subparagraph shall be equal to 3,000 in each such year. (iii)

Process for distributing positions

(I)

Rounds of applications

The Secretary shall initiate 5 separate rounds of applications for an increase under clause (i), 1 round with respect to each of fiscal years 2015 through 2019. (II)

Number available

In each of such rounds, the aggregate number of positions available for distribution in the fiscal year under clause (ii) shall be distributed, plus any additional positions available under clause (iv). (III)

Timing

The Secretary shall notify hospitals of the number of positions distributed to the hospital under this paragraph as a result of an increase in the otherwise applicable resident limit by January 1 of the fiscal year of the increase. Such increase shall be effective for portions of cost reporting periods beginning on or after July 1 of that fiscal year. (iv)

Positions not distributed during the fiscal year

(I)

In general

If the number of resident full-time equivalent positions distributed under this paragraph in a fiscal year is less than the aggregate number of positions available for distribution in the fiscal year (as described in clause (ii), including after application of this subclause), the difference between such number distributed and such number available for distribution shall be added to the aggregate number of positions available for distribution in the following fiscal year. (II)

Exception if positions not distributed by end of fiscal year 2019

If the aggregate number of positions distributed under this paragraph during the 5-year period of fiscal years 2015 through 2019 is less than 15,000, the Secretary shall, in accordance with the provisions of clause (ii) and subparagraph (D) and the considerations and priority described in subparagraph (C), conduct an application and distribution process in each subsequent fiscal year until such time as the aggregate amount of positions distributed under this paragraph is equal to 15,000. (B)

Allocation of distribution for positions to hospitals already operating over resident limit

(i)

In general

Subject to clauses (ii) and (iii), in the case of a hospital in which the reference resident level of the hospital (as specified in subparagraph (G)(iii)) is greater than the otherwise applicable resident limit, the increase in the otherwise applicable resident limit under subparagraph (A) for a fiscal year described in such subparagraph shall be an amount equal to the product of the total number of additional residency positions available for distribution under subparagraph (A)(ii)(I) for such fiscal year and the quotient of— (I)the number of resident positions by which the reference resident level of the hospital exceeds the otherwise applicable resident limit for the hospital; and (II)the number of resident positions by which the reference resident level of all such hospitals with respect to which an application is approved under this paragraph exceeds the otherwise applicable resident limit for such hospitals. (ii)

Requirements

A hospital described in clause (i)— (I)is not eligible for an increase in the otherwise applicable resident limit under this subparagraph unless the amount by which the reference resident level of the hospital exceeds the otherwise applicable resident limit is not less than 10 and the hospital trains at least 25 percent of the full-time equivalent residents of the hospital in primary care and general surgery (as of the date of enactment of this paragraph); and (II)shall continue to train at least 25 percent of the full-time equivalent residents of the hospital in primary care and general surgery for the 5-year period beginning on such date.

In the case where the Secretary determines that a hospital described in clause (i) no longer meets the requirement of subclause (II), the Secretary may reduce the otherwise applicable resident limit of the hospital by the amount by which such limit was increased under this subparagraph.

(iii)

Clarification regarding eligibility for other additional residency positions

Nothing in this subparagraph shall be construed as preventing a hospital described in clause (i) from applying for and receiving additional residency positions under this paragraph that are not reserved for distribution under this subparagraph. (C)

Distribution of other positions

For purposes of determining an increase in the otherwise applicable resident limit under subparagraph (A) (other than such an increase described in subparagraph (B)), the following shall apply: (i)

Considerations in distribution

In determining for which hospitals such an increase is provided under subparagraph (A), the Secretary shall take into account the demonstrated likelihood of the hospital filling the positions made available under this paragraph within the first 5 cost reporting periods beginning after the date the increase would be effective, as determined by the Secretary. (ii)

Priority for certain hospitals

Subject to clause (iii), in determining for which hospitals such an increase is provided, the Secretary shall distribute the increase in the following priority order: (I)First, to hospitals in States with (aa) new medical schools that received Candidate School status from the Liaison Committee on Medical Education or that received Pre-Accreditation status from the American Osteopathic Association Commission on Osteopathic College Accreditation on or after January 1, 2000, and that have achieved or continue to progress toward Full Accreditation status (as such term is defined by the Liaison Committee on Medical Education) or toward Accreditation status (as such term is defined by the American Osteopathic Association Commission on Osteopathic College Accreditation), or (bb) additional locations and branch campuses established on or after January 1, 2000, by medical schools with Full Accreditation status (as such term is defined by the Liaison Committee on Medical Education) or Accreditation status (as such term is defined by the American Osteopathic Association Commission on Osteopathic College Accreditation). (II)Second, to hospitals that emphasize training in community health center or community-based settings or in hospital outpatient departments. (III)Third, to hospitals that are eligible for incentive payments under section 1886(n) or 1903(t) as of the date the hospital submits an application for such increase under subparagraph (A). (IV)Fourth, to all other hospitals. (iii)

Distribution to hospitals in higher priority group prior to distribution in lower priority groups

The Secretary may only distribute such an increase to a lower priority group under clause (ii) if all qualifying hospitals in the higher priority group or groups have received the maximum number of increases under such subparagraph that the hospital is eligible for under this paragraph for the fiscal year. (iv)

Requirements for use of additional positions

(I)

In general

Subject to subclause (II), a hospital that receives such an increase shall ensure, during the 5-year period beginning on the effective date of such increase, that— (aa)not less than 50 percent of the positions attributable to such increase that are used in a given year during such 5-year period are used to train full-time equivalent residents in a shortage specialty residency program (as defined in subparagraph (G)(v)), as determined by the Secretary at the end of such 5-year period; (bb)the total number of full-time equivalent residents, excluding any additional positions attributable to such increase, is not less than the average number of full-time equivalent residents during the 3 most recent cost reporting periods ending on or before the effective date of such increase; and (cc)the ratio of full-time equivalent residents in a shortage specialty residency program (as so defined) is not less than the average ratio of full-time equivalent residents in such a program during the 3 most recent cost reporting periods ending on or before the effective date of such increase. (II)

Redistribution of positions if hospital no longer meets certain requirements

With respect to each fiscal year described in subparagraph (A), the Secretary shall determine whether or not a hospital described in subclause (I) meets the requirements of such subclause. In the case that the Secretary determines that such a hospital does not meet such requirements, the Secretary shall— (aa)reduce the otherwise applicable resident limit of the hospital by the amount by which such limit was increased under this paragraph; and (bb)provide for the distribution of positions attributable to such reduction in accordance with the requirements of this paragraph. (D)

Limitation

A hospital may not receive more than 75 full-time equivalent additional residency positions under this paragraph for any fiscal year. (E)

Application of per resident amounts for primary care and nonprimary care

With respect to additional residency positions in a hospital attributable to the increase provided under this paragraph, the approved FTE per resident amounts are deemed to be equal to the hospital per resident amounts for primary care and nonprimary care computed under paragraph (2)(D) for that hospital. (F)

Permitting facilities to apply aggregation rules

The Secretary shall permit hospitals receiving additional residency positions attributable to the increase provided under this paragraph to, beginning in the fifth year after the effective date of such increase, apply such positions to the limitation amount under paragraph (4)(F) that may be aggregated pursuant to paragraph (4)(H) among members of the same affiliated group. (G)

Definitions

In this paragraph: (i)

Otherwise applicable resident limit

The term otherwise applicable resident limit means, with respect to a hospital, the limit otherwise applicable under subparagraphs (F)(i) and (H) of paragraph (4) on the resident level for the hospital determined without regard to this paragraph but taking into account paragraphs (7)(A), (7)(B), (8)(A), and (8)(B). (ii)

Reference resident level

Except as otherwise provided in subclause (II), the term reference resident level means, with respect to a hospital, the resident level for the most recent cost reporting period of the hospital ending on or before the date of enactment of this paragraph, for which a cost report has been settled (or, if not, submitted (subject to audit)), as determined by the Secretary. (iii)

Resident level

The term resident level has the meaning given such term in paragraph (7)(C)(i). (iv)

Shortage specialty residency program

The term shortage specialty residency program means the following: (I)

Prior to report on shortage specialties

Prior to the date on which the report of the National Health Care Workforce Commission is submitted under section 3 of the Resident Physician Shortage Reduction Act of 2013, any approved residency training program in a specialty identified in the report entitled The Physician Workforce: Projections and Research into Current Issues Affecting Supply and Demand, issued in December 2008 by the Health Resources and Services Administration, as a specialty whose baseline physician requirements projections exceed the projected supply of total active physicians for the period of 2005 through 2020. (II)

After report on shortage specialties

On or after the date on which the report of the National Health Care Workforce Commission is submitted under such section, any approved residency training program in a physician specialty identified in such report as a specialty for which there is a shortage.

(b)

IME

Section 1886(d)(5)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) is amended— (1)in clause (v), in the second sentence, by striking subsections (h)(7) and (h)(8) and inserting subsections (h)(7), (h)(8), and (h)(9); (2)by redesignating clause (x), as added by section 5505(b) of the Patient Protection and Affordable Care Act (Public Law 111–148), as clause (xi) and moving such clause 4 ems to the left; and (3)by adding after clause (xi), as redesignated by subparagraph (A), the following new clause:

(xii)For discharges occurring on or after July 1, 2015, insofar as an additional payment amount under this subparagraph is attributable to resident positions distributed to a hospital under subsection (h)(9), the indirect teaching adjustment factor shall be computed in the same manner as provided under clause (ii) with respect to such resident positions.