[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2264 Reported in House (RH)]
Union Calendar No. 57
103d CONGRESS
1st Session
H. R. 2264
[Report No. 103-111]
_______________________________________________________________________
A BILL
To provide for reconciliation pursuant to section 7 of the concurrent
resolution on the budget for fiscal year 1994.
_______________________________________________________________________
May 25, 1993
Committed to the Committee of the Whole House on the State of the Union
and ordered to be printed
Union Calendar No. 57
103d CONGRESS
1st Session
H. R. 2264
[Report No. 103-111]
To provide for reconciliation pursuant to section 7 of the concurrent
resolution on the budget for fiscal year 1994.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 25, 1993
Mr. Sabo, from the Committee on the Budget, reported the following
bill; which was committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______________________________________________________________________
A BILL
To provide for reconciliation pursuant to section 7 of the concurrent
resolution on the budget for fiscal year 1994.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Omnibus Budget Reconciliation Act of
1993''.
SEC. 2. TABLE OF CONTENTS.
The table of contents is as follows:
TITLE I--COMMITTEE ON AGRICULTURE
TITLE II--COMMITTEE ON ARMED SERVICES
TITLE III--COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS
TITLE IV--COMMITTEE ON EDUCATION AND LABOR
TITLE V--COMMITTEE ON ENERGY AND COMMERCE
TITLE VI--COMMITTEE ON FOREIGN AFFAIRS
TITLE VII--COMMITTEE ON THE JUDICIARY
TITLE VIII--COMMITTEE ON MERCHANT MARINE AND FISHERIES
TITLE IX--COMMITTEE ON NATURAL RESOURCES
TITLE X--COMMITTEE ON POST OFFICE AND CIVIL SERVICE
TITLE XI--COMMITTEE ON PUBLIC WORKS
TITLE XII--COMMITTEE ON VETERANS' AFFAIRS
TITLE XIII--COMMITTEE ON WAYS AND MEANS--SAVINGS
TITLE XIV--COMMITTEE ON WAYS AND MEANS--REVENUES
TITLE I--COMMITTEE ON AGRICULTURE
SEC. 1001. SHORT TITLE AND TABLE OF CONTENTS.
(a) Short Title.--This title may be cited as the ``Agricultural
Reconciliation Act of 1993''.
(b) Table of Contents.--The table of contents of this title is as
follows:
Sec. 1001. Short title and table of contents.
Subtitle A--Commodity Programs
Sec. 1101. Wheat program.
Sec. 1102. Feed grain program.
Sec. 1103. Upland cotton program.
Sec. 1104. Rice program.
Sec. 1105. Dairy program.
Sec. 1106. Tobacco program.
Sec. 1107. Sugar program.
Sec. 1108. Oilseeds program.
Sec. 1109. Peanut program.
Sec. 1110. Honey program.
Sec. 1111. Wool and mohair program.
Sec. 1112. Conforming amendments to continue deficit reduction
activities in crop years after 1995.
Subtitle B--Restructuring of Loan Programs
Sec. 1201. Restructuring of certain loan programs.
Sec. 1202. Reorganization of rural development functions.
Subtitle C--Food Stamp Program
Sec. 1301. Short title.
Sec. 1302. References to Act.
Chapter 1--Ensuring Adequate Food Assistance
Sec. 1311. Maximum benefit level.
Sec. 1312. Helping low-income high school students.
Sec. 1313. Families with high shelter expenses.
Sec. 1314. Resource exclusion for earned income tax credits.
Sec. 1315. Homeless families in transitional housing.
Sec. 1316. Households benefiting from general assistance vendor
payments.
Sec. 1317. Continuing benefits to eligible households.
Sec. 1318. Improving the nutritional status of children in Puerto Rico.
Chapter 2--Promoting Self Sufficiency
Sec. 1321. Income exclusion for education assistance.
Sec. 1322. Child support payments to nonhousehold members.
Sec. 1323. Child support exclusion.
Sec. 1324. Improving access to employment and training activities.
Sec. 1325. Vehicles needed to seek and continue employment and for
household transportation.
Sec. 1326. Vehicles necessary to carry fuel or water.
Sec. 1327. Demonstration projects testing resource accumulation.
Chapter 3--Simplifying the Provision of Food Assistance
Sec. 1331. Simplifying the household definition for households with
children and others.
Sec. 1332. Eligibility of children of parents participating in drug or
alcohol treatment programs.
Sec. 1333. Resources of households with disabled members.
Sec. 1334. Ensuring adequate funding for the food stamp program.
Chapter 4--Improving Program Integrity
Sec. 1341. Use and disclosure of information provided by retail food
stores and wholesale food concerns.
Sec. 1342. Additional means of claims collection.
Sec. 1343. Demonstration projects testing activities directed at street
trafficking in coupons.
Chapter 5--Improving Food Stamp Program Management
Sec. 1351. Clarification of categorical eligibility.
Sec. 1352. Technical amendments related to electronic benefit transfer.
Sec. 1353. Disqualification of recipients for trading firearms,
ammunition, explosives, or controlled
substances for coupons.
Sec. 1354. Uncapped civil money penalty for trafficking in coupons.
Sec. 1355. Uncapped civil money penalty for selling firearms,
ammunition, explosives, or controlled
substances for coupons.
Sec. 1356. Modifying the food stamp quality control system.
Chapter 6--Uniform Reimbursement Rates
Sec. 1361. Uniform reimbursement rates.
Chapter 7--Implementation and Effective Dates
Sec. 1371. Implementation and effective dates.
Subtitle D--Miscellaneous Provisions
Sec. 1401. Maximum expenditures under market promotion program for
fiscal years 1994 through 1998.
Sec. 1402. Admission, entrance, and recreation fees.
Sec. 1403. Additional program changes to meet reconciliation
requirements.
Sec. 1404. Environmental conservation acreage reserve program
amendments.
Sec. 1405. Levels of insurance coverage under the Federal Crop
Insurance Act.
Subtitle A--Commodity Programs
SEC. 1101. WHEAT PROGRAM.
(a) Five Percent Reduction in Payment Acres.--
(1) Reduction.--Subsection (c)(1)(C)(ii) of section 107B of
the Agricultural Act of 1949 (7 U.S.C. 1445b-3a) is amended by
striking ``85 percent'' and inserting ``80 percent''.
(2) Application of amendment.--The amendment made by
paragraph (1) shall apply beginning with the 1994 crop of
wheat.
(b) Continuation of Deficit Reduction Activities in Crop Years
After 1995.--
(1) Agricultural act of 1949.--Section 107B of the
Agricultural Act of 1949 (7 U.S.C. 1445b-3a) is further
amended--
(A) in the section heading, by striking ``1995''
and inserting ``1998'';
(B) in subsections (a)(1), (a)(4)(C), (b)(1),
(c)(1)(A), (c)(1)(B)(iii), (e)(1)(G), (e)(3)(A),
(e)(3)(C)(iii), (f)(1), and (q), by striking ``1995''
each place it appears and inserting ``1998'';
(C) in the heading of subsection (c)(1)(B)(ii), by
striking ``and 1995'' and inserting ``through 1998'';
(D) in subsection (c)(1)(B)(ii), by striking ``and
1995'' and inserting ``through 1998''; and
(E) in the heading of subsection (e)(1)(G), by
striking ``1995'' and inserting ``1998''; and
(F) in subsection (g)(1), by striking ``and 1995''
and inserting ``through 1998''.
(2) Food, agriculture, conservation, and trade act of
1990.--Title III of the Food, Agriculture, Conservation, and
Trade Act of 1990 (Public Law 101-624; 104 Stat. 3382) is
amended--
(A) in section 302 (7 U.S.C. 1379d note), by
striking ``May 31, 1996'' and inserting ``May 31,
1999'';
(B) in section 303 (7 U.S.C. 1331 note), by
striking ``1995'' and inserting ``1998'';
(C) in section 304 (7 U.S.C. 1340 note), by
striking ``1995'' and inserting ``1998''; and
(D) in section 305 (7 U.S.C. 1445a note)--
(i) in the section heading, by striking
``1995'' and inserting ``1998''; and
(ii) by striking ``1995'' and inserting
``1998''.
(3) Food security wheat reserve.--Section 302(i) of the
Food Security Wheat Reserve Act of 1980 (7 U.S.C. 1736f-1(i))
is amended by striking ``1995'' both places it appears and
inserting ``1998''.
SEC. 1102. FEED GRAIN PROGRAM.
(a) Five Percent Reduction in Payment Acres.--
(1) Reduction.--Subsection (c)(1)(C)(ii) of section 105B of
the Agricultural Act of 1949 (7 U.S.C. 1444f) is amended by
striking ``85 percent'' and inserting ``80 percent''.
(2) Application of amendment.--The amendment made by
paragraph (1) shall apply beginning with the 1994 crop of feed
grains.
(b) Continuation of Deficit Reduction Activities in Crop Years
After 1995.--
(1) Agricultural act of 1949.--Section 105B of the
Agricultural Act of 1949 (7 U.S.C. 1444f) is further amended--
(A) in the section heading, by striking ``1995''
and inserting ``1998'';
(B) in subsections (a)(1), (a)(4)(C), (a)(6),
(b)(1), (c)(1)(A), (c)(1)(B)(iii)(I),
(c)(1)(B)(iii)(III), (e)(1)(G), (e)(1)(H), (e)(2)(H),
(e)(3)(A), (e)(3)(C)(iii), (f)(1), (p)(1), (q)(1), and
(r), by striking ``1995'' each place it appears and
inserting ``1998'';
(C) in the heading of subsection (c)(1)(B)(ii), by
striking ``and 1995'' and inserting ``through 1998'';
(D) in subsection (c)(1)(B)(ii), by striking ``and
1995'' and inserting ``through 1998'';
(E) in the headings of subsections (e)(1)(G) and
(e)(1)(H), by striking ``1995'' both places it appears
and inserting ``1998''; and
(F) in subsection (g)(1), by striking ``and 1995''
and inserting ``through 1998''.
(2) Food, agriculture, conservation, and trade act of
1990.--Section 402 of the Food, Agriculture, Conservation, and
Trade Act of 1990 (7 U.S.C. 1444b note) is amended--
(A) in the section heading, by striking ``1995''
and inserting ``1998''; and
(B) by striking ``1995'' and inserting ``1998''.
(3) Recourse loan program for silage.--Section 403 of the
Food Security Act of 1985 (7 U.S.C. 1444e-1) is amended by
striking ``1996'' and inserting ``1999''.
SEC. 1103. UPLAND COTTON PROGRAM.
(a) Five Percent Reduction in Payment Acres.--
(1) Reduction.--Subsection (c)(1)(C)(ii) of section 103B of
the Agricultural Act of 1949 (7 U.S.C. 1444-2) is amended by
striking ``85 percent'' and inserting ``80 percent''.
(2) Application of amendment.--The amendment made by
paragraph (1) shall apply beginning with the 1994 crop of
upland cotton.
(b) Continuation of Deficit Reduction Activities in Crop Years
After 1995.--
(1) Agricultural act of 1949.--(A) Section 103(h)(16) of
the Agricultural Act of 1949 (7 U.S.C. 1444(h)(16)) is amended
by striking ``1996'' and inserting ``1999''.
(B) Section 103B of such Act (7 U.S.C. 1444-2) is further
amended--
(i) in the section heading, by striking ``1995''
and inserting ``1998'';
(ii) in subsections (a)(1), (b)(1), (c)(1)(A),
(c)(1)(B)(ii), (e)(3)(A), (f)(1), and (o), by striking
``1995'' each place it appears and inserting ``1998'';
and
(iii) in subparagraphs (B)(i), (D)(i), (E)(i), and
(F)(i) of subsection (a)(5), by striking ``1996'' each
place it appears and inserting ``1999''.
(C) Section 203(b) of such Act (7 U.S.C. 1446d(b)) is
amended by striking ``1995'' and inserting ``1998''.
(2) Agricultural adjustment act of 1938.--Section 374(a) of
the Agricultural Adjustment Act of 1938 (7 U.S.C. 1374(a)) is
amended by striking ``1995'' each place it appears and
inserting ``1998''.
(3) Food, agriculture, conservation, and trade act of
1990.--Title V of the Food, Agriculture, Conservation, and
Trade Act of 1990 (Public Law 101-624; 104 Stat. 3421) is
amended--
(A) in section 502 (7 U.S.C. 1342 note), by
striking ``1995'' and inserting ``1998'';
(B) in section 503 (7 U.S.C. 1444 note), by
striking ``1995'' and inserting ``1998''; and
(C) in section 505 (7 U.S.C. 1342 note)--
(i) in the section heading, by striking
``1996'' and inserting ``1999''; and
(ii) by striking ``1996'' and inserting
``1999''.
SEC. 1104. RICE PROGRAM.
(a) Five Percent Reduction in Payment Acres.--
(1) Reduction.--Subsection (c)(1)(C)(ii) of section 101B of
the Agricultural Act of 1949 (7 U.S.C. 1441-2) is amended by
striking ``85 percent'' and inserting ``80 percent''.
(2) Application of amendment.--The amendment made by
paragraph (1) shall apply beginning with the 1994 crop of rice.
(b) Continuation of Deficit Reduction Activities in Crop Years
After 1995.--Such section is further amended--
(1) in the section heading, by striking ``1995'' and
inserting ``1998'';
(2) in subsections (a)(1), (a)(3), (b)(1), (c)(1)(A),
(c)(1)(B)(iii), (e)(3)(A), (f)(1), and (n), by striking
``1995'' each place it appears and inserting ``1998'';
(3) in subsection (a)(5)(D)(i), by striking ``1996'' and
inserting ``1999'';
(4) in the heading of subsection (c)(1)(B)(ii), by striking
``and 1995'' and inserting ``through 1998''; and
(5) in subsection (c)(1)(B)(ii), by striking ``and 1995''
and inserting ``through 1998''.
SEC. 1105. DAIRY PROGRAM.
(a) Allocation of Purchase Prices for Butter and Nonfat Dry Milk.--
(1) In general.--Subsection (c)(3) of section 204 of the
Agricultural Act of 1949 (7 U.S.C. 1446e) is amended--
(A) in the first sentence of subparagraph (A), by
striking ``The Secretary'' and inserting ``Subject to
subparagraph (B), the Secretary'';
(B) by redesignating subparagraph (B) as
subparagraph (C); and
(C) by inserting after subparagraph (A) the
following new subparagraph:
``(B) Guidelines.--In allocating the rate of price
support between the purchase prices of butter and
nonfat dry milk under this paragraph, the Secretary may
not--
``(i) offer to purchase butter for more
than $0.65 per pound; or
``(ii) offer to purchase nonfat dry milk
for less than $1.034 per pound.''.
(2) Application of amendments.--The amendments made by
paragraph (1) shall apply with respect to purchases of butter
and nonfat dry milk that are made by the Secretary of
Agriculture under section 204 of the Agricultural Act of 1949
(7 U.S.C. 1446e) on or after the date of the enactment of this
Act.
(b) Reduction in Price Received.--Subsection (h)(2) of such section
is amended--
(1) by striking ``and'' at the end of subparagraph (A);
(2) by striking the period at the end of subparagraph (B)
and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(C) during each of the calendar years 1996
through 1998, 10 cents per hundredweight of milk
marketed, which rate shall be adjusted on or before May
1 of each of the calendar years 1996 through 1998 in
the manner provided in subparagraph (B).''.
(c) Continuation of Deficit Reduction Activities in Fiscal Years
After 1995.--
(1) In general.--Section 204 of the Agricultural Act of
1949 (7 U.S.C. 1446e) is further amended--
(A) in the section heading, by striking ``1995''
and inserting ``1998'';
(B) in subsections (a), (b), (d)(1)(A), (d)(2)(A),
(d)(3), (f), (g)(1), and (k), by striking ``1995'' each
place it appears and inserting ``1998''; and
(C) in subsection (g)(2), by striking ``1994'' and
inserting ``1997''.
(2) Transfer to military and veterans hospitals.--
Subsections (a) and (b) of section 202 of such Act (7 U.S.C.
1446a) are amended by striking ``1995'' both places it appears
and inserting ``1998''.
(3) Federal milk marketing orders.--Section 101(b) of the
Agriculture and Food Act of 1981 (7 U.S.C. 608c note) is
amended by striking ``1995'' and inserting ``1998''.
(4) Dairy indemnity program.--Section 3 of Public Law 90-
484 (7 U.S.C. 450l) is amended by striking ``1995'' and
inserting ``1998''.
(5) Food security act of 1985.--The Food Security Act of
1985 is amended--
(A) in section 153 (15 U.S.C. 713a-14), by striking
``1995'' and inserting ``1998''; and
(B) in section 1163 (7 U.S.C. 1731 note), by
striking ``1995'' each place it appears and inserting
``1998''.
SEC. 1106. TOBACCO PROGRAM.
(a) Ten Percent Increase in Marketing Assessment.--Subsection
(g)(1) of section 106 of the Agricultural Act of 1949 (7 U.S.C. 1445)
is amended by striking ``equal to'' and all that follows through the
period and inserting the following: ``equal to--
``(A) in the case of the 1991 through 1993 crops of
tobacco, .5 percent of the national average price support level
for each such crop as otherwise provided for in this section;
and
``(B) in the case of the 1994 through 1998 crops of
tobacco, .55 percent of the national average price support
level for each such crop as otherwise provided for in this
section.''.
(b) Continuation of Deficit Reduction Activities in Fiscal Years
After 1995.--Such subsection is further amended by striking ``1995''
and inserting ``1998''.
(c) Acreage-Poundage Quotas for Tobacco.--
(1) Definitions.--Subsection (a) of section 317 of the
Agricultural Adjustment Act of 1938 (7 U.S.C. 1314c) is
amended--
(A) by inserting ``Definitions.--'' after ``(a)'';
and
(B) by striking paragraphs (2), (3), (4), (5), (6),
(7), and (8) and inserting the following new
paragraphs:
``(2) Farm acreage allotment.--The term `farm acreage
allotment' for a tobacco farm, other than a new tobacco farm,
means the acreage allotment determined by dividing the farm
marketing quota by the farm yield.
``(3) Farm yield.--The term `farm yield' means the yield
per acre for a farm determined according to regulations issued
by the Secretary and which would be expected to result in a
quality of tobacco acceptable to the tobacco trade.
``(4) Farm marketing quota.--
``(A) In general.--The term `farm marketing quota'
for a farm for a marketing year means a number that is
equal to the number of pounds of tobacco determined by
multiplying--
``(i) the farm marketing quota for the farm
for the previous marketing year (prior to any
adjustment for undermarketing or
overmarketing); by
``(ii) the national factor.
``(B) Adjustment.--The farm marketing quota
determined under subparagraph (A) for a marketing year
shall be increased for undermarketing or decreased for
overmarketing by the number of pounds by which
marketings of tobacco from the farm during the
immediate preceding marketing year (if marketing quotas
were in effect for that year under the program
established by this section) is less than or exceeds
the farm marketing quota for such year. Notwithstanding
the preceding sentence, the farm marketing quota for a
marketing year shall not be increased under this
subparagraph for undermarketing by an amount in excess
of the farm marketing quota determined for the farm for
the immediately preceding year prior to any increase
for undermarketing or decrease for overmarketing. If
due to excess marketing in the preceding marketing year
the farm marketing quota for the marketing year is
reduced to zero pounds without reflecting the entire
reduction required, the additional reduction shall be
made for the subsequent marketing year or years.
``(5) National factor.--The term `national factor' for a
marketing year means a number obtained by dividing--
``(A) the national marketing quota (less the
reserve provided for under subsection (e)); by
``(B) the sum of the farm marketing quotas (prior
to any adjustments for undermarketing or overmarketing)
for the immediate preceding marketing year for all
farms for which marketing quotas for the kind of
tobacco involved will be determined for such succeeding
marketing year.''.
(2) Conforming amendments.--Such section is further
amended--
(A) in the first sentence of subsection (b), by
striking ``and the national acreage allotment and
national average yield goal for the 1965 crop of Flue-
cured tobacco,'';
(B) in the first sentence of subsection (c), by
striking ``and at the same time announce the national
acreage allotment and national average yield goal'';
(C) in subsection (d)--
(i) in the sixth sentence, by striking ``,
national acreage allotment, and national
average yield goal'';
(ii) in the eighth sentence, by striking
``, national acreage allotment and national
average yield goal''; and
(iii) in the ninth sentence, by striking
``, national acreage allotment, and national
average goal are'' and inserting ``is'';
(D) in subsection (e)--
(i) in the first sentence, by striking ``No
farm acreage allotment or farm yield shall be
established'' and inserting ``A farm marketing
quota and farm yield shall not be
established'';
(ii) in the second sentence, by striking
``acreage allotment'' both places it appears
and inserting ``marketing quota'';
(iii) in the second sentence, by striking
``acreage allotments'' both places it appears
and inserting ``marketing quotas''; and
(iv) in the last sentence, by striking
``acreage allotment'' and inserting ``marketing
quota''; and
(E) in subsection (g)--
(i) in paragraph (1), by striking
``paragraph (a)(8)'' and inserting ``subsection
(a)(4)''; and
(ii) in paragraph (3), by striking
``subsection (a)(8)'' and inserting
``subsection (a)(4)''.
(3) Farm marketing quota reductions.--Subsection (f) of
such section is amended to read as follows:
``(f) Causes for Farm Marketing Quota Reductions.--(1) When an
acreage-poundage program is in effect for any kind of tobacco under
this section, the farm marketing quota next established for a farm
shall be reduced by the amount of such kind of tobacco produced on the
farm--
``(A) which was marketed as having been produced on a
different farm;
``(B) for which proof of disposition is not furnished as
required by the Secretary;
``(C) on acreage equal to the difference between the
acreage reported by the farm operator or a duly authorized
representative and the determined acreage for the farm; and
``(D) as to which any producer on the farm files, or aids,
or acquiesces, in the filing of any false report with respect
to the production or marketing of tobacco.
``(2) If the Secretary, through the local committee, finds that no
person connected with a farm caused, aided, or acquiesced in any
irregularity described in paragraph (1), the next established farm
marketing quota shall not be reduced under this subsection.
``(3) The reduction required under this subsection shall be in
addition to any other adjustments made pursuant to this section.
``(4) In establishing farm marketing quotas for other farms owned
by the owner displaced by acquisition of the owner's land by any
agency, as provided in section 378 of this Act, increases or decreases
in such farm marketing quotas as provided in this section shall be made
on account of marketings below or in excess of the farm marketing quota
for the farm acquired by the agency.
``(5) Acreage allotments and farm marketing quotas determined under
this section may (except in the case of kinds of tobacco not subject to
section 316) be leased and sold under the terms and conditions in
section 316 of this Act, except that any credit for undermarketing or
charge for overmarketing shall be attributed to the farm to which
transferred.''.
SEC. 1107. SUGAR PROGRAM.
(a) Ten Percent Increase in Marketing Assessment.--Subsection (i)
of section 206 of the Agricultural Act of 1949 (7 U.S.C. 1446g) is
amended--
(1) in paragraph (1), by striking ``equal to'' and all that
follows through the period and inserting the following: ``equal
to--
``(A) in the case of marketings during fiscal years
1992 and 1993, .18 cents per pound of raw cane sugar,
processed by the processor from domestically produced
sugarcane or sugarcane molasses, that has been marketed
(including the transfer or delivery of the sugar to a
refinery for further processing or marketing); and
``(B) in the case of marketings during fiscal years
1994 through 1999, .198 cents per pound of raw cane
sugar, processed by the processor from domestically
produced sugarcane or sugarcane molasses, that has been
marketed (including the transfer or delivery of the
sugar to a refinery for further processing or
marketing).''; and
(2) in paragraph (2), by striking ``equal to'' and all that
follows through the period and inserting the following: ``equal
to--
``(A) in the case of marketings during fiscal years
1992 and 1993, .193 cents per pound of beet sugar,
processed by the processor from domestically produced
sugar beets or sugar beet molasses, that has been
marketed; and
``(B) in the case of marketings during fiscal years
1994 through 1999, .2123 cents per pound of beet sugar,
processed by the processor from domestically produced
sugar beets or sugar beet molasses, that has been
marketed.''.
(b) Continuation of Deficit Reduction Activities in Crop Years
After 1995.--
(1) Agricultural act of 1949.--Section 206 of the
Agricultural Act of 1949 (7 U.S.C. 1446g) is further amended--
(A) in the section heading, by striking ``1995''
and inserting ``1998'';
(B) in subsections (a), (c), (d)(1), and (j), by
striking ``1995'' each place it appears and inserting
``1998''; and
(C) in paragraphs (1) and (2) of subsection (i), as
amended by subsection (a), by striking ``1996'' both
places it appears and inserting ``1999''.
(2) Agricultural adjustment act of 1938.--Section
359b(a)(1) of the Agricultural Adjustment Act of 1938 (7 U.S.C.
1359bb(a)(1)) is amended by striking ``1996'' and inserting
``1999''.
SEC. 1108. OILSEEDS PROGRAM.
(a) Continuation of Deficit Reduction Activities in Crop Years
After 1995.--Section 205 of the Agricultural Act of 1949 (7 U.S.C.
1446f) is amended--
(1) in the section heading, by striking ``1995'' and
inserting ``1998''; and
(2) in subsections (b), (c), (e)(1), and (n), by striking
``1995'' each place it appears and inserting ``1998''.
SEC. 1109. PEANUT PROGRAM.
(a) Assessment to Cover Unanticipated Losses in Administering the
Program.--
(1) Additional assessment.--Section 108B of the
Agricultural Act of 1949 (7 U.S.C. 1445c-3) is amended--
(A) by redesignating subsection (h) as subsection
(i); and
(B) by inserting after subsection (g) the following
new subsection:
``(h) Additional Marketing Assessment.--
``(1) Two percent assessment.--In addition to the marketing
assessment required by subsection (g), the Secretary shall also
provide for a nonrefundable marketing assessment applicable to
each of the 1993 through 1998 crops of peanuts and collected
and paid in accordance with this subsection. The assessment
shall be on a per pound basis in an amount equal to 2 percent
of the national average quota or additional peanut support rate
per pound, as applicable, for the applicable crop. No peanuts
shall be assessed more than 2 percent of the applicable support
rate under this subsection.
``(2) First purchasers.--Except as provided under
paragraphs (3) and (4), the first purchaser of peanuts shall--
``(A) collect from the producer a marketing
assessment equal to 1 percent of the applicable
national average support rate times the quantity of
peanuts acquired;
``(B) pay, in addition to the amount collected
under subparagraph (A), a marketing assessment in an
amount equal to 1 percent of the applicable national
average support rate times the quantity of peanuts
acquired; and
``(C) remit the amounts required under
subparagraphs (A) and (B) to the Commodity Credit
Corporation in a manner specified by the Secretary.
``(3) Other private marketings.--In the case of a private
marketing by a producer directly to a consumer through a retail
or wholesale outlet or in the case of a marketing by the
producer outside of the continental United States, the producer
shall be responsible for the full amount of the assessment
under this subsection and shall remit the assessment by such
time as is specified by the Secretary.
``(4) Loan peanuts.--In the case of peanuts that are
pledged as collateral for a price support loan made under this
section, \1/2\ of the assessment under this subsection shall be
deducted from the proceeds of the loan. The remainder of the
assessment shall be paid by the first purchaser of the peanuts
as provided in subparagraph (B) of paragraph (2). For purposes
of computing net gains on peanuts under this section, the
reduction in loan proceeds under this subsection shall be
treated as having been paid to the producer.
``(5) Reserve account.--
``(A) Establishment.--The Secretary shall establish
in the Commodity Credit Corporation a reserve account
to be administered by the Secretary for purposes of
this section. There shall be deposited in the reserve
account for each crop of peanuts an amount equal to--
``(i) the total amount remitted to the
Commodity Credit Corporation under paragraphs
(2) and (3) as the payment of the marketing
assessment applicable to that crop of peanuts
under this subsection; and
``(ii) the total amount deducted from the
proceeds of a price support loan or paid by
first purchasers under paragraph (4) as the
payment of the marketing assessment applicable
to that crop of peanuts under this subsection.
``(B) Use of reserve account.--The Secretary shall
use amounts in the reserve account established in this
paragraph to cover losses incurred by the Commodity
Credit Corporation on the sale or disposal of peanuts.
``(6) Application of other provisions.--Paragraphs (2)(B),
(5), and (6) of subsection (g) shall apply with respect to the
marketing assessment required by this subsection.''.
(2) Effective date.--The amendments made by paragraph (1)
shall take effect 15 days after the date of the enactment of
this Act.
(b) Continuation of Deficit Reduction Activities in Crop Years
After 1995.--
(1) Agricultural act of 1949.--Section 108B of the
Agricultural Act of 1949 (7 U.S.C. 1445c-3) is further
amended--
(A) in the section heading, by striking ``1995''
and inserting ``1998'';
(B) in subsections (a)(1), (a)(2), (b)(1), and
(g)(1), by striking ``1995'' each place it appears and
inserting ``1998''; and
(C) in subsection (i) (as redesignated by
subsection (a)(1)(A)), by striking ``1995'' and
inserting ``1998''.
(2) Agricultural adjustment act of 1938.--Part VI of
subtitle B of title III of the Agricultural Adjustment Act of
1938 is amended--
(A) in section 358-1 (7 U.S.C. 1358-1)--
(i) in the section heading, by striking
``1995'' and inserting ``1998''; and
(ii) in subsections (a)(1), (b)(1)(A),
(b)(1)(B), (b)(2)(A), (b)(2)(C), (b)(3), and
(f), by striking ``1995'' each place it appears
and inserting ``1998'';
(B) in section 358b (7 U.S.C. 1358b)--
(i) in the section heading, by striking
``1995'' and inserting ``1998''; and
(ii) in subsection (c), by striking
``1995'' and inserting ``1998'';
(C) in section 358c(d) (7 U.S.C. 1358c(d)), by
striking ``1995'' and inserting ``1998''; and
(D) in section 358e (7 U.S.C. 1359a)--
(i) in the section heading, by striking
``1995'' and inserting ``1998''; and
(ii) in subsection (i), by striking
``1995'' and inserting ``1998''.
(3) Food, agriculture, conservation, and trade act of
1990.--Title VIII of the Food, Agriculture, Conservation, and
Trade Act of 1990 (Public Law 101-624; 104 Stat. 3459) is
amended--
(A) in section 801 (104 Stat. 3459), by striking
``1995'' and inserting ``1998'';
(B) in section 807 (104 Stat. 3478), by striking
``1995'' and inserting ``1998''; and
(C) in section 808 (7 U.S.C. 1441 note), by
striking ``1995'' and inserting ``1998''.
(c) Assessment Under Peanut Marketing Agreement.--Section 8b(b)(1)
of the Agricultural Adjustment Act (7 U.S.C. 608b(b)(1)), reenacted
with amendments by the Agricultural Marketing Agreement Act of 1937, is
amended--
(1) by striking ``and'' at the end of subparagraph (A);
(2) by striking the period at the end of subparagraph (B)
and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(C) any assessment imposed under such agreement shall
apply to peanut handlers (as that term is defined by the
Secretary) who have not entered into such an agreement with the
Secretary in addition to those handlers who have entered into
such agreement.''.
(d) Customs Treatment of Certain Peanut Products.--
(1) Temporary additional duties.--Subchapter I of chapter
99 of the Harmonized Tariff Schedule of the United States is
amended by inserting in numerical order the following new
headings:
`` 9901.11.10 Peanut paste (provided for in subheading 2007.99.65)..... 55 cents/kg No change 55 cents/kg On or before 7/
31/96
9901.11.12 Peanut butter (provided for in subheading 2008.11.00).... 55 cents/kg No change 55 cents/kg On or before 7/
31/96 ''
(2) Inclusion of peanut butter in quota.--Heading
9904.20.20 of the Harmonized Tariff Schedule of the United
States is amended by striking out ``(except peanut butter)''.
(3) Effective dates.--
(A) Temporary additional duties.--The amendment
made by paragraph (1) applies with respect to entries
and withdrawals from warehouse for consumption made on
or after the 15th day after the date of the enactment
of this Act.
(B) Quota amendment.--The amendment made by
paragraph (2) applies with respect to entries and
withdrawals from warehouse for consumption made after
July 31, 1996.
SEC. 1110. HONEY PROGRAM.
(a) Reduced Support Rate.--Subsection (a) of section 207 of the
Agricultural Act of 1949 (7 U.S.C. 1446h) is amended by striking ``53.8
cents'' and inserting ``50 cents''.
(b) Payment Limitations.--Subsection (e)(1) of such section is
amended--
(1) by striking ``and'' at the end of subparagraph (C);
(2) by striking subparagraph (D); and
(3) by adding at the end the following new subparagraphs:
``(D) $125,000 in the 1994 crop year;
``(E) $100,000 in the 1995 crop year;
``(F) $75,000 in the 1996 crop year; and
``(G) $50,000 in each of the 1997 and subsequent
crop years.''.
(c) Continuation of Deficit Reduction Activities.--Subsections (a),
(c)(1), and (j) of such section are amended by striking ``1995'' each
place it appears and inserting ``1998''.
(d) Termination of Assessment.--Subsection (i)(1) of such section
is amended by striking ``1995'' and inserting ``1993''.
SEC. 1111. WOOL AND MOHAIR PROGRAM.
(a) Payment Limitations.--Section 704(b)(1) of the National Wool
Act of 1954 (7 U.S.C. 1783(b)(1)) is amended--
(1) by striking ``and'' at the end of subparagraph (C);
(2) by striking subparagraph (D); and
(3) by adding at the end the following new subparagraphs:
``(D) $125,000 for the 1994 marketing year;
``(E) $100,000 for the 1995 marketing year;
``(F) $75,000 for 1996 marketing year; and
``(G) $50,000 for each of the 1997 and subsequent
marketing years.''.
(b) Marketing Charges.--Section 706 of National Wool Act of 1954 (7
U.S.C. 1785) is amended by inserting after the second sentence the
following new sentence: ``In determining the net sales proceeds and
national payment rates for shorn wool and shorn mohair the Secretary
shall not deduct marketing charges for commissions, coring, or
grading.''.
(c) Continuation of Deficit Reduction Activities in Crop Years
After 1995.--Subsections (a) and (b)(2) of section 703 of the National
Wool Act of 1954 (7 U.S.C. 1782) are amended by striking ``1995'' both
places it appears and inserting ``1998''.
(d) Termination of Marketing Assessment.--Section 704(c) of the
National Wool Act of 1954 (7 U.S.C. 1783(c)) is amended by striking
``1995'' and inserting ``1992''.
(e) Technical and Conforming Amendments.--
(1) Policy of congress.--Section 702 of the National Wool
Act of 1954 (7 U.S.C. 1781) is amended--
(A) by striking ``, strategic,'' in the first
sentence; and
(B) by striking ``as a measure of national security
and to promote'' and inserting ``that as a method to
promote''.
(2) Elimination of obsolete provision.--Section 703(b) of
the National Wool Act of 1954 (7 U.S.C. 1782(b)) is amended--
(A) in paragraph (1), by striking ``paragraphs (2)
and (3)'' and inserting ``paragraph (2)'';
(B) in paragraph (2), by striking ``Except as
provided in paragraph (3), for'' and inserting ``For'';
and
(C) by striking paragraph (3).
(3) Advertising and sales promotion programs.--Section 708
of the National Wool Act of 1954 (7 U.S.C. 1787) is amended--
(A) by inserting ``(a)'' after ``Sec. 708.''; and
(B) by adding at the end the following new
subsection:
``(b)(1) Except as provided in paragraph (2), to the extent that
the Secretary determines that the amount of funds that would otherwise
be made available under subsection (a) in any marketing year for
agreements entered into under such subsection is less than the amount
made available under such subsection in the previous marketing year,
the difference in such amounts shall be provided from amounts available
to support the prices of wool and mohair under section 703 of this
title. Any amount provided under this subsection shall be considered to
be an expenditure made in connection with payments to producers under
this title for purposes of section 705 of this title.
``(2) Paragraph (1) shall not apply if the Secretary determines
that any portion of the difference between the amounts made available
under subsection (a) between two consecutive marketing years is the
result of a per unit reduction in the amount of the assessment imposed
under the agreements entered into under such subsection.''.
SEC. 1112. CONFORMING AMENDMENTS TO CONTINUE DEFICIT REDUCTION
ACTIVITIES IN CROP YEARS AFTER 1995.
(a) Supplemental Set-Aside and Acreage Limitation Authority.--
Section 113 of the Agricultural Act of 1949 (7 U.S.C. 1445h) is amended
by striking ``1995'' and inserting ``1998''.
(b) Deficiency and Land Diversion Payments.--Subsections (a)(1),
(b), and (c) of section 114 of the Agricultural Act of 1949 (7 U.S.C.
1445j) are amended by striking ``1995'' each place it appears and
inserting ``1998''.
(c) Disaster Payments.--Section 208 of the Agricultural Act of 1949
(7 U.S.C. 1446i) is amended--
(1) in the section heading, by striking ``1995'' and
inserting ``1998'';
(2) in subsection (d), by striking ``1995'' and inserting
``1998''.
(d) Miscellaneous.--Title IV of the Agricultural Act of 1949 (7
U.S.C. 1421 et seq.) is amended--
(1) in section 402(b) (7 U.S.C. 1422(b)), by striking
``1995'' and inserting ``1998'';
(2) in section 403(c) (7 U.S.C. 1423(c)), by striking
``1995'' and inserting ``1998'';
(3) in section 406(b) (7 U.S.C. 1426(b))--
(A) by striking ``1995'' each place it appears and
inserting ``1998''; and
(B) by striking ``1996'' each place it appears and
inserting ``1999''; and
(4) in section 408(k)(3) (7 U.S.C. 1428(k)(3)), by striking
``1995'' and inserting ``1998''.
(e) Acreage Base and Yield System.--Title V of the Agricultural Act
of 1949 (7 U.S.C. 1461 et seq.) is amended--
(1) in subsections (c)(3) and (h)(2)(A) of section 503 (7
U.S.C. 1463), by striking ``1995'' each place it appears and
inserting ``1998'';
(2) in subsections (b)(1) and (b)(2) of section 505 (7
U.S.C. 1465), by striking ``1995'' each place it appears and
inserting ``1998''; and
(3) in section 509 (7 U.S.C. 1469), by striking ``1995''
and inserting ``1998''.
(f) Normally Planted Acreage.--Section 1001 of the Food and
Agriculture Act of 1977 (7 U.S.C. 1309) is amended in subsections (a),
(b)(1), and (c) by striking ``1995'' each place it appears and
inserting ``1998''.
(g) Agriculture and Food Act of 1981.--Section 1014 of the
Agriculture and Food Act of 1981 (7 U.S.C. 4110) is amended by striking
``1995'' and inserting ``1998''.
(h) Food Security Act of 1985.--The Food Security Act of 1985
(Public Law 99-198; 99 Stat. 1354) is amended--
(1) in section 902(c)(2)(A) (7 U.S.C. 1446 note), by
striking ``1995'' and inserting ``1998'';
(2) in paragraphs (1)(A), (1)(B), and (2)(A) of section
1001 (7 U.S.C. 1308), by striking ``1995'' each place it
appears and inserting ``1998'';
(3) in section 1001C(a) (7 U.S.C. 1308-3(a)), by striking
``1995'' both places it appears and inserting ``1998'';
(4) in section 1017(b) (7 U.S.C. 1385 note), by striking
``1995'' and inserting ``1998''; and
(5) in section 1019 (7 U.S.C. 1310a), by striking ``1995''
and inserting ``1998''.
(i) Options Pilot Program.--The Options Pilot Program Act of 1990
(subtitle E of title XI of Public Law 101-624; 104 Stat. 3518; 7 U.S.C.
1421 note) is amended--
(1) in subsections (a) and (b) of section 1153, by striking
``1995'' each place it appears and inserting ``1998''; and
(2) in section 1154(b)(1)(A), by striking ``1995'' both
places it appears and inserting ``1998''.
(j) Readjustment of Support Levels.--Section 1302 of the
Agricultural Reconciliation Act of 1990 (7 U.S.C. 1421 note) is amended
in subsections (b)(1), (b)(3), and (d)(1)(C) by striking ``1995'' each
place it appears and inserting ``1998''.
Subtitle B--Restructuring of Loan Programs
SEC. 1201. RESTRUCTURING OF CERTAIN LOAN PROGRAMS.
(a) Loan Programs Under the Rural Electrification Act of 1936.--
(1) Insured loan programs.--Section 305 of the Rural
Electrification Act of 1936 (7 U.S.C. 935) is amended--
(A) by striking subsections (b) and (d);
(B) by redesignating subsection (c) as subsection
(b); and
(C) by inserting after subsection (b) (as so
redesignated) the following:
``(c) Insured Electric Loans.--
``(1) Hardship loans.--
``(A) In general.--The Administrator shall make
insured electric loans at an interest rate of 5 percent
per annum to any applicant therefor who meets each of
the following requirements:
``(i) The average revenue per kilowatt-hour
sold by the applicant is not less than 120
percent of the average revenue per kilowatt-
hour sold by all utilities in the State in
which the borrower provides service.
``(ii) The average residential revenue per
kilowatt-hour sold by the applicant is not less
than 120 percent of the average residential
revenue per kilowatt-hour sold by all utilities
in the State in which the borrower provides
service.
``(iii) The average per capita income of
the residents receiving electric service from
the applicant is less than the average per
capita income of the residents of the State in
which the applicant provides service, or the
median household income of the households
receiving electric service from the applicant
is less than the median household income of the
households in the State.
``(B) Severe hardship loans.--The Administrator may
make an insured electric loan at an interest rate of 5
percent per annum to an applicant therefor if, in the
sole discretion of the Administrator, the applicant has
experienced a severe hardship.
``(C) Limitation.--The Administrator may not make a
loan under this paragraph to an applicant for the
purpose of furnishing or improving electric service to
a consumer located in an urban or urbanized area (as
defined by the Bureau of the Census) if the average
number of consumers per mile of line of the total
electric system of the applicant exceeds 17.
``(2) Municipal rate loans.--
``(A) In general.--The Administrator shall make
insured electric loans, to the extent of qualifying
applications therefor, at the interest rate described
in subparagraph (B) for the term or terms selected by
the applicant pursuant to subparagraph (C).
``(B) Interest rate.--
``(i) In general.--Subject to clause (ii),
the interest rate described in this
subparagraph on a loan to a qualifying
applicant shall be--
``(I) the interest rate determined
by the Administrator to be equal to the
current market yield on outstanding
municipal obligations with remaining
periods to maturity similar to the term
selected by the applicant pursuant to
subparagraph (C), but not greater than
the rate determined under section
307(a)(3)(A) of the Consolidated Farm
and Rural Development Act which is
based on the current market yield on
outstanding municipal obligations; plus
``(II) if the applicant for the
loan makes an election pursuant to
subparagraph (D) to include in the loan
agreement the right of the applicant to
prepay the loan, a rate equal to the
amount by which--
``(aa) the interest rate on
commercial loans for a similar
period that afford the borrower
such a right; exceeds
``(bb) the interest rate on
commercial loans for such
period that do not afford the
borrower such a right.
``(ii) Maximum rate.--The interest rate
described in this subparagraph on a loan to an
applicant therefor shall not exceed 7 percent
if--
``(I) the average number of
consumers per mile of line of the total
electric system of the applicant is
less than 5.50; or
``(II)(aa) the average revenue per
kilowatt-hour sold by the applicant is
more than the average revenue per
kilowatt-hour sold by all utilities in
the State in which the borrower
provides service; and
``(bb) the average per capita
income of the residents receiving
electric service from the applicant is
less than the average per capita income
of the residents of the State in which
the applicant provides service, or the
median household income of the
households receiving electric service
from the applicant is less than the
median household income of the
households in the State.
``(iii) Exception.--Clause (ii) shall not
apply to a loan to be made to an applicant for
the purpose of furnishing or improving electric
service to consumers located in an urban or
urbanized area (as defined by the Bureau of the
Census) if the average number of consumers per
mile of line of the total electric system of
the applicant exceeds 17.
``(C) Loan term.--
``(i) In general.--Subject to clause (ii),
the applicant for a loan under this paragraph
may select the term during which the loan is to
be repaid, and, at the end of such term (and
any succeeding term selected by the applicant
under this subparagraph), may renew the loan
for another term selected by the applicant.
``(ii) Maximum term.--Notwithstanding
clause (i), the applicant may not select a term
that ends more than 35 years after the
beginning of the 1st term the applicant selects
under clause (i).
``(D) Call provision.--The Administrator shall
offer any applicant for a loan under this paragraph the
option to include in the loan agreement the right of
the applicant to prepay the loan on terms consistent
with similar provisions of commercial loans.
``(3) Other source of credit not required in certain
cases.--The Administrator may not require any applicant for a
loan made under this subsection who is eligible for a loan
under paragraph (1) to obtain a loan from another source as a
condition of approving the application for the loan or
advancing any amount under the loan.
``(d) Insured Telephone Loans.--
``(1) Hardship loans.--
``(A) In general.--The Administrator shall make
insured telephone loans, to the extent of qualifying
applications therefor, at an interest rate of 5 percent
per annum, to any applicant who meets each of the
following requirements:
``(i) The average number of subscribers per
mile of line in the service area of the
applicant is not more than 4.
``(ii) The applicant is capable of
producing net income or margins, after interest
payments on the loan applied for, of not less
than 100 percent (but not more than 300
percent) of the interest requirements on all of
the outstanding and proposed loans of the
applicant.
``(iii) The Administrator has approved a
telecommunications modernization plan for the
State under paragraph (3), and, if the plan was
developed by telephone borrowers under this
title, the applicant is a participant in the
plan.
``(B) Authority to waive tier requirement.--The
Administrator may waive the requirement of subparagraph
(A)(ii) in any case in which the Administrator
determines (and sets forth the reasons therefor in
writing) that the requirement would prevent emergency
restoration of the telephone system of the applicant or
result in severe hardship to the applicant.
``(C) Effect of lack of funds.--On request of any
applicant who is eligible for a loan under this
paragraph for which funds are not available, the
applicant shall be considered to have applied for a
loan under title IV.
``(2) Cost-of-money loans.--
``(A) In general.--The Administrator may make
insured telephone loans for the purchase and
installation of telephone lines, systems, and
facilities (other than buildings used primarily for
administrative purposes, vehicles not used primarily in
construction, and personal customer premise equipment)
directly related to the furnishing, improvement, or
extension of rural telecommunications service or the
acquisition of a rural telecommunications capability,
at an interest rate equal to the then cost of money to
the Government of the United States for loans of
similar maturity, but not more than 7 percent per
annum, to any applicant therefor who meets the
following requirements:
``(i) The average number of subscribers per
mile of line in the service area of the
applicant is not more than 15.
``(ii) The applicant is capable of
producing net income or margins, after interest
payments on the loan applied for, of not less
than 100 percent (but not more than 500
percent) of the interest requirements on all of
the outstanding and proposed loans of the
applicant.
``(iii) The Administrator has approved a
telecommunications modernization plan for the
State under paragraph (3), and, if the plan was
developed by telephone borrowers under this
title, the applicant is a participant in the
plan.
``(B) Call provision.--The Administrator shall
offer any applicant for a loan under this paragraph the
option to include in the loan agreement the right of
the applicant to prepay the loan.
``(C) Concurrent loan authority.--On request of any
applicant for a loan under this paragraph during any
fiscal year, the Administrator shall--
``(i) consider the application to be for a
loan under this paragraph and a loan under
section 408; and
``(ii) if the applicant is eligible
therefor, make a loan to the applicant under
this paragraph in an amount equal to the amount
that bears the same ratio to the total amount
of loans for which the applicant is eligible
under this paragraph and under section 408, as
the amount made available for loans under this
paragraph for the fiscal year bears to the
total amount made available for loans under
this paragraph and under section 408 for the
fiscal year.
``(D) Effect of lack of funds.--On request of any
applicant who is eligible for a loan under this
paragraph for which funds are not available, the
applicant shall be considered to have applied for a
loan guarantee under section 306.
``(3) State telecommunications modernization plans.--
``(A) Approval.--If, within 6 months after final
regulations are promulgated to carry out this
paragraph, the public utility commission of any State
develops a telecommunications modernization plan that
meets the requirements of subparagraph (B), then the
Administrator shall approve the plan for the State.
Otherwise, the Administrator shall approve any
telecommunications modernization plan for the State
that meets such requirements, which is developed by a
majority of the borrowers of telephone loans made under
this title who are located in the State.
``(B) Requirements.--A telecommunications
modernization plan must, at a minimum, meet the
following objectives:
``(i) The plan must provide for the
elimination of party line service.
``(ii) The plan must provide for the
availability of telecommunications services for
improved business, educational, and medical
services.
``(iii) The plan must encourage and improve
computer networks and information highways for
subscribers in rural areas.
``(iv) The plan must provide for--
``(I) subscribers in rural areas to
be able to receive through telephone
lines--
``(aa) multiple voices;
``(bb) video images; and
``(cc) data at a rate of at
least 1,000,000 bits of
information per second; and
``(II) the proper routing of
information to subscribers.
``(v) The plan must provide for uniform
deployment schedules to ensure that advanced
services are deployed at the same time in rural
and nonrural areas.
``(C) Finality of approval.--A telecommunications
modernization plan approved under subparagraph (A) may
not subsequently be disapproved.''.
(2) Rural telephone bank loan program.--Section 408 of the
Rural Electrification Act of 1936 (7 U.S.C. 948) is amended--
(A) in subsection (a)--
(i) by striking ``, (1)'' and all that
follows through ``(3)'' and inserting ``(1) for
the purchase and installation of telephone
lines, systems, and facilities (other than
buildings used primarily for administrative
purposes, vehicles not used primarily in
construction, and personal customer premise
equipment) directly related to the furnishing,
improvement, or extension of rural
telecommunications service or the acquisition
of a rural telecommunications capability, and
(2)''; and
(ii) by striking ``(2) hereof'' and
inserting ``clause (1)'';
(B) in subsection (b)--
(i) by amending paragraph (4) to read as
follows:
``(4)(A) The Governor of the telephone bank may make a loan
under this section only to an applicant therefor who meets the
following requirements:
``(i) The average number of subscribers per mile of
line in the service area of the applicant is not more
than 15.
``(ii) The applicant is capable of producing net
income or margins, after interest payments on the loan
applied for, of not less than 100 percent (but not more
than 500 percent) of the interest requirements on all
of the outstanding and proposed loans of the applicant.
``(iii) The Administrator has approved, under
section 305(d)(3), a telecommunications modernization
plan for the State in which the applicant is located,
and, if the plan was developed by telephone borrowers
under title III, the applicant is a participant in the
plan.'';
(ii) in paragraph (8)--
(I) by inserting ``(A)'' after
``(8)'';
(II) by striking ``if such
prepayment is not made later than
September 30, 1988'' and inserting
``except for any prepayment penalty
provided for in a loan agreement
entered into before the date of the
enactment of the Omnibus Budget
Reconciliation Act of 1993''; and
(III) by adding at the end the
following:
``(B) If a borrower prepays part or all of a loan made
under this section, then, notwithstanding section 407(b), the
Governor of the telephone bank shall--
``(i) use the full amount of the prepayment to
repay obligations of the telephone bank issued pursuant
to section 407(b) before October 1, 1991, to the extent
any such obligations are outstanding; and
``(ii) in repaying such obligations, first repay
the advances bearing the greatest rate of interest.'';
and
(iii) by adding at the end the following:
``(9) On request of any applicant for a loan under this
section during any fiscal year, the Governor of the telephone
bank shall--
``(A) consider the application to be for a loan
under this section and a loan under section 305(d)(2);
and
``(B) if the applicant is eligible therefor, make a
loan to the applicant under this section in an amount
equal to the amount that bears the same ratio to the
total amount of loans for which the applicant is
eligible under this section and under section
305(d)(2), as the amount made available for loans under
this section for the fiscal year bears to the total
amount made available for loans under this section and
under section 305(d)(2) for the fiscal year.
``(10) On request of any applicant who is eligible for a
loan under this section for which funds are not available, the
applicant shall be considered to have applied for a loan under
section 305(d)(2).''; and
(C) by adding at the end the following:
``(e) Loans and advances made under this section on or after
November 5, 1990, shall bear interest at a rate determined under this
section, taking into account all assets and liabilities of the
telephone bank. This subsection shall not apply to loans obligated
before the date of the enactment of this subsection.''.
(3) Funding.--Section 314 of such Act (7 U.S.C. 940d) is
amended to read as follows:
``SEC. 314. LIMITATIONS ON AUTHORIZATION OF APPROPRIATIONS.
``(a) In General.--There are authorized to be appropriated to the
Administrator such sums as may be necessary for the cost of loans in
the following amounts, for the following purposes and periods of time:
``(1) Electric hardship loans.--For loans under section
305(c)(1)--
``(A) for fiscal year 1994, $125,000,000; and
``(B) for each of fiscal years 1995 through 1998,
$125,000,000, increased by the adjustment percentage
for the fiscal year.
``(2) Electric municipal rate loans.--For loans under
section 305(c)(2)--
``(A) for fiscal year 1994, $600,000,000; and
``(B) for each of fiscal years 1995 through 1998,
$600,000,000, increased by the adjustment percentage
for the fiscal year.
``(3) Telephone hardship loans.--For loans under section
305(d)(1)--
``(A) for fiscal year 1994, $125,000,000; and
``(B) for each of fiscal years 1995 through 1998,
$125,000,000, increased by the adjustment percentage
for the fiscal year.
``(4) Telephone cost-of-money loans.--For loans under
section 305(d)(2)--
``(A) for fiscal year 1994, $198,000,000; and
``(B) for each of fiscal years 1995 through 1998,
$198,000,000, increased by the adjustment percentage
for the fiscal year.
``(b) Adjustment Percentage Defined.--As used in subsection (a),
the term `adjustment percentage' means, with respect to a fiscal year,
the percentage (if any) by which--
``(1) the average of the Consumer Price Index (as defined
in section 1(f)(5) of the Internal Revenue Code of 1986) for
the 12-month period ending on July 31 of the immediately
preceding fiscal year; exceeds
``(2) the average of the Consumer Price Index (as so
defined) for the 12-month period ending on July 31, 1993.
``(c) Mandatory Levels.--The Administrator shall make insured loans
under this title from the Rural Electrification and Telephone Revolving
Fund established under section 301, for the purposes, in the amounts,
and for the periods of time specified in subsection (a), as provided in
advance in appropriations Acts.
``(d) Availability of Funds for Insured Loans.--Amounts made
available for loans under section 305 are authorized to remain
available until expended.''.
(4) Rule of interpretation.--Section 309(a) of such Act (7
U.S.C. 939(a)) is amended by adding at the end the following:
``The preceding sentence shall not be construed to make section
408(b)(2) or 412 applicable to this title.''.
(5) Miscellaneous amendments.--
(A) Section 2 of such Act (7 U.S.C. 902) is
amended--
(i) by inserting ``(a)'' before ``The
Administrator'';
(ii) by striking ``telephone service in
rural areas, as hereinafter provided;'' and
inserting ``electric and telephone service in
rural areas, as provided in this Act, and for
the purpose of assisting electric borrowers to
implement demand side management and energy
conservation programs''; and
(iii) by adding at the end the following:
``(b) Not later than January 1, 1994, the Administrator shall issue
interim regulations to implement the authority contained in subsection
(a) to make loans for the purpose of assisting electric borrowers to
implement demand side management and energy conservation programs. If
such regulations are not issued by such date, the Administrator shall
consider any demand side management program which is approved by a
State agency to be eligible for such loans.''
(B) Section 4 of such Act (7 U.S.C. 904) is amended
by inserting ``and for the furnishing and improving of
electric service to persons in rural areas, including
by assisting electric borrowers to implement demand
side management and energy conservation programs''
after ``central station service''.
(C) Section 7 of such Act (7 U.S.C. 907) is
amended--
(i) by inserting ``(a)'' before ``The
Administrator is'';
(ii) by designating the 2nd undesignated
paragraph as subsection (b); and
(iii) by adding at the end the following:
``(c) Section 306(b) of the Consolidated Farm and Rural Development
Act shall apply to a borrower of a loan under this Act in the same
manner in which such section applies to an association referred to in
such section.''.
(D) Section 13 of such Act (7 U.S.C. 913) is
amended--
(i) by inserting ``, except as provided in
section 203(b),'' before ``shall be deemed to
mean any area''; and
(ii) by striking ``city, village, or
borough having a population in excess of
fifteen hundred inhabitants'' and inserting
``urban or urbanized area, as defined by the
Bureau of the Census''.
(E) Section 203(b) of such Act (7 U.S.C. 923(b)) is
amended by striking ``one thousand five hundred'' and
inserting ``5,000''.
(F) Section 307 of such Act (7 U.S.C. 937) is
amended by adding at the end the following: ``The
Administrator may not request any applicant for an
electric loan under this Act to apply for and accept a
loan in an amount exceeding 30 percent of the credit
needs of the applicant.''.
(G) Section 406 of such Act (7 U.S.C. 946) is
amended by adding at the end the following:
``(i) The Governor of the telephone bank may invest in obligations
of the United States the amounts in the account in the Treasury of the
United States numbered 12X8139 (known as `the RTB Equity Fund').''.
(H) Section 18 of such Act (7 U.S.C. 918) is
amended--
(i) by inserting ``(a) No Consideration of
Borrower's Level of General Funds.--'' before
``The Administrator''; and
(ii) by adding at the end the following:
``(b) No Loan Origination Fees.--The Administrator and the Governor
of the telephone bank may not charge any fee or charge not expressly
provided in this Act in connection with any loan under this Act.''.
(I) Title III of such Act (7 U.S.C. 931-940d) is
amended by inserting after section 306B the following:
``SEC. 306C. ELIGIBILITY OF DISTRIBUTION BORROWERS FOR LOANS, LOAN
GUARANTEES, AND LIEN ACCOMMODATIONS.
``A distribution borrower not in default on the repayment of any
loan made or guaranteed under this Act shall be eligible for a loan,
loan guarantee, or lien accommodation under this title. For the purpose
of determining such eligibility, a default by a borrower from which a
distribution borrower purchases wholesale power shall not be considered
a default by the distribution borrower.
``SEC. 306D. ADMINISTRATIVE PROHIBITIONS APPLICABLE TO ELECTRIC
BORROWERS.
``The Administrator may not require prior approval of, impose any
requirement, restriction, or prohibition with respect to the operations
of, or deny or delay the granting of a lien accommodation to, any
electric borrower under this Act whose net worth exceeds 110 percent of
the outstanding principal balance on all loans made or guaranteed to
the borrower by the Administrator.''.
(b) Expanded Eligibility for Loans for Water and Waste Disposal
Facilities.--Section 306(a)(1) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1926(a)(1)) is amended by inserting after the
1st sentence the following: ``The Secretary may also make loans to any
borrower to whom a loan has been made under the Rural Electrification
Act of 1936, for the conservation, development, use, and control of
water, and the installation of drainage or waste disposal facilities,
primarily serving farmers, ranchers, farm tenants, farm laborers, rural
businesses, and other rural residents.''.
(c) Regulations.--Not later than October 1, 1993, the Administrator
of the Rural Development Administration shall issue interim final rules
to implement the amendments made by this section.
SEC. 1202. REORGANIZATION OF RURAL DEVELOPMENT FUNCTIONS.
(a) Administration of Rural Electrification Act of 1936 Transferred
to the Rural Development Administration.--
(1) In general.--The Rural Electrification Act of 1936 (7
U.S.C. 901 et seq.) is amended by striking all after the
enacting clause that precedes section 2 and inserting the
following:
``SECTION 1. SHORT TITLE; ADMINISTRATION OF ACT.
``(a) Short Title.--This Act may be cited as the `Rural
Electrification Act of 1936'.
``(b) Administration of Act.--The Administrator of the Rural
Development Administration (in this Act referred to as the
`Administrator') shall carry out this Act under the general direction
and supervision of the Secretary of Agriculture.''.
(2) Conforming amendments.--
(A) Section 3(a) of such Act (7 U.S.C. 903(a)) is
amended by striking ``appointed pursuant to the
provisions of this Act''.
(B) Section 8 of such Act (7 U.S.C. 908) is
amended--
(i) by striking ``authorized to be
appointed by this Act''; and
(ii) by striking ``Rural Electrification
Administration created by this Act'' and
inserting ``Rural Development Administration''.
(C) Each of the following provisions of such Act is
amended by striking ``Rural Electrification
Administration'' and inserting ``Rural Development
Administration'':
(i) Section 306A(b) (7 U.S.C. 936a(b)).
(ii) Section 403(b) (7 U.S.C. 943(b)).
(iii) Section 404 (7 U.S.C. 944).
(iv) Section 406(c) (7 U.S.C. 946(c)).
(v) Section 410(a)(1) (7 U.S.C. 950(a)(1)).
(b) Other Functions of the Rural Electrification Administration
Transferred to the Rural Development Administration.--Section 364 of
the Consolidated Farm and Rural Development Act (7 U.S.C. 2006f) is
amended by adding at the end the following:
``(g) Transfer of Functions of the Rural Electrification
Administration to the Rural Development Administration.--
``(1) In general.--All rights, interests, obligations, and
duties of the Administrator of the Rural Electrification
Administration arising before the date of the enactment of this
subsection, from any loan made, insured, or guaranteed by, or
other action of, the Rural Electrification Administration shall
be vested in the Administrator of the Rural Development
Administration.
``(2) References.--Any reference in any law, regulation, or
order in effect immediately before the date of the enactment of
this subsection to the Rural Electrification Administration or
to the Administrator of the Rural Electrification
Administration, is deemed to be a reference to the Rural
Development Administration or to the Administrator of the Rural
Development Administration, respectively.
``(3) Effect on pending proceedings and parties to such
proceedings.--
``(A) Nonabatement of proceedings.--This subsection
shall not be construed to abate any proceeding
commenced by or against the Rural Electrification
Administration or the Administrator of the Rural
Electrification Administration.
``(B) Effect on parties.--If an officer of the
Rural Electrification Administration, in the official
capacity of such officer, is a party to a proceeding
pending on the date of the enactment of this
subsection, then such action shall be continued with
the Administrator, or other appropriate officer, of the
Rural Development Administration substituted or added
as a party.
``(4) Incidental transfers.--The Secretary shall transfer
all personnel from the Rural Electrification Administration to
the Rural Development Administration, and shall make such
determinations as may be appropriate to carry out this
subsection.''.
(c) Structure of the Rural Development Administration.--Such
section 364 (7 U.S.C. 2006f), as amended by subsection (b) of this
section, is amended by adding at the end the following:
``(h) Structure of the Rural Development Administration.--
``(1) Deputy administrator for rural utilities.--The
Administrator of the Rural Development Administration shall
appoint a Deputy Administrator for Rural Utilities who shall
administer--
``(A) the programs authorized by the Rural
Electrification Act of 1936; and
``(B) the rural water and waste disposal programs
administered by the Rural Development Administration.
``(2) Assistant administrators.--The Administrator of the
Rural Development Administration may appoint--
``(A) an Assistant Administrator for the electric
programs authorized by the Rural Electrification Act of
1936;
``(B) an Assistant Administrator for the telephone
programs authorized by such Act;
``(C) an Assistant Administrator who shall be
responsible for--
``(i) rural utility technical engineering
standards and specifications; and
``(ii) other utility management and
accounting functions assigned by the
Administrator; and
``(D) an Assistant Administrator for water and
sewer programs.''.
(d) Rural Economic Development.--
(1) In general.--Such section 364 (7 U.S.C. 2006f), as
amended by subsections (b) and (c) of this section, is amended
by adding at the end the following:
``(i) Rural Economic Development.--A borrower of a loan or loan
guarantee under the Rural Electrification Act of 1936 shall be eligible
for assistance under all programs administered by the Rural Development
Administration, and the Administrator of the Rural Development
Administration shall encourage and facilitate the full participation of
such a borrower in such programs.
``(j) Technical Assistance Unit.--The Administrator of the Rural
Development Administration shall establish a technical assistance unit
to provide to borrowers under the programs administered by the Rural
Development Administration advice and guidance on community and
economic development activities.''.
(2) Conforming repeal.--Section 11A of the Rural
Electrification Act of 1936 (7 U.S.C. 911a) is hereby repealed.
(e) Regulations.--Not later than January 1, 1994, the Administrator
of the Rural Development Administration shall issue interim final rules
to implement the amendments made by this section.
Subtitle C--Food Stamp Program
SEC. 1301. SHORT TITLE.
This subtitle may be cited as the ``Mickey Leland Childhood Hunger
Relief Act''.
SEC. 1302. REFERENCES TO THE ACT.
Except as otherwise provided in this subtitle, references in this
subtitle to ``the Act'' and sections of the Act shall be deemed to be
references to the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.) and
the sections of such Act.
CHAPTER 1--ENSURING ADEQUATE FOOD ASSISTANCE
SEC. 1311. MAXIMUM BENEFIT LEVEL.
Section 3(o) of the Act (7 U.S.C. 2012(o)) is amended by striking
``(4) through'' and all that follows through the end of the subsection,
and inserting the following:
``and (4) on October 1, 1993, and each October 1 thereafter, adjust the
cost of such diet to reflect 104 percent of the cost of the thrifty
food plan in the preceding June (without regard to adjustments made to
such costs in any previous year), as determined by the Secretary, and
round the result to the nearest lower dollar increment for each
household size.''.
SEC. 1312. HELPING LOW-INCOME HIGH SCHOOL STUDENTS.
Section 5(d)(7) of the Act (7 U.S.C. 2014(d)(7)) is amended by
striking ``who is a student, and who has not attained his eighteenth
birthday'' and inserting ``who is an elementary or secondary school
student, and who is 21 years of age or younger''.
SEC. 1313. FAMILIES WITH HIGH SHELTER EXPENSES.
(a) Computation.--Section 5(e) of the Act (7 U.S.C. 2014(e)) is
amended--
(1) in the fourth sentence by striking ``: Provided, That
the amount'' and all that follows through ``June 30''; and
(2) in the fifth sentence by striking ``under clause (2) of
the preceding sentence''.
(b) Limitations.--
(1) Fiscal year 1994.--Effective on the date of enactment
of this Act, section 5(e) of the Act (7 U.S.C. 2014(e)) is
amended by inserting after the fourth sentence the following:
``In the 12-month period ending September 30, 1994, such excess shelter
expense deduction shall not exceed $214 a month in the 48 contiguous
States and the District of Columbia, and shall not exceed, in Alaska,
Hawaii, Guam, and the Virgin Islands of the United States, $372, $305,
$259, and $158 a month, respectively.''.
(2) Removal of cap.--Effective October 1, 1994, section
5(e) of the Act (7 U.S.C. 2014(e)), as amended by paragraph
(1), is amended by striking the fifth sentence.
SEC. 1314. RESOURCE EXCLUSION FOR EARNED INCOME TAX CREDITS.
Section 5(g)(3) of the Act (7 U.S.C. 2014(g)(3)) is amended by
adding at the end the following:
``The Secretary shall also exclude from financial resources any earned
income tax credits received by any member of the household for a period
of 12 months from receipt if such member was participating in the food
stamp program at the time the credits were received and participated in
such program continuously during the twelve-month period.''.
SEC. 1315. HOMELESS FAMILIES IN TRANSITIONAL HOUSING.
Section 5(k)(2)(F) of the Act (7 U.S.C. 2014(k)(2)(F)) is amended
to read as follows:
``(F) housing assistance payments made to a third party on
behalf of the household residing in transitional housing for
the homeless;''.
SEC. 1316. HOUSEHOLDS BENEFITING FROM GENERAL ASSISTANCE VENDOR
PAYMENTS.
Section 5(k)(1)(B) of the Act (7 U.S.C. 2014(k)(1)(B)) is amended
by striking ``living expenses'' and inserting ``housing expenses, not
including energy or utility-cost assistance,''.
SEC. 1317. CONTINUING BENEFITS TO ELIGIBLE HOUSEHOLDS.
Section 8(c)(2)(B) of the Act (7 U.S.C. 2017(c)(2)(B)) is amended
by inserting ``of more than one month in'' after ``following any
period''.
SEC. 1318. IMPROVING THE NUTRITIONAL STATUS OF CHILDREN IN PUERTO RICO.
Section 19(a)(1)(A) of the Act (7 U.S.C. 2028(a)(1)(A)) is amended
by--
(1) striking ``$1,091,000,000'' and inserting
``$1,111,000,000''; and
(2) striking ``$1,133,000,000'' and inserting
``$1,158,000,000''.
CHAPTER 2--PROMOTING SELF SUFFICIENCY
SEC. 1321. INCOME EXCLUSION FOR EDUCATION ASSISTANCE.
Section 5 of the Act (7 U.S.C. 2014) is amended by--
(1) amending subsection (d)(3) to read as follows:
``(3) all educational loans on which payment is deferred
(including any loan origination fees or insurance premiums
associated with such loans), grants, scholarships, fellowships,
veterans' educational benefits, and the like awarded to a
household member enrolled at a recognized institution of post-
secondary education, at a school for the handicapped, in a
vocational education program, or in a program that provides for
completion of a secondary school diploma or obtaining the
equivalent thereof,'';
(2) striking ``, and no portion'' and all that follows
through ``for living expenses,'' in subsection (d)(5); and
(3) striking subsection (k)(3).
SEC. 1322. CHILD SUPPORT PAYMENTS TO NON-HOUSEHOLD MEMBERS.
Section 5(d)(6) of the Act (7 U.S.C. 2014(d)6)) is amended by
striking the comma at the end and inserting the following--
``: Provided, That child support payments made by a household member to
or for a person who is not a member of the household shall be excluded
from the income of the household of the person making such payments if
such household member was legally obligated to make such payments:
Provided further, That the Secretary is authorized to prescribe by
regulation the method(s), which may include calculation on a
retrospective basis, that State agencies may use to determine the
amount of child support excluded,''.
SEC. 1323. CHILD SUPPORT EXCLUSION.
Section 5 of the Act (7 U.S.C. 2014) is amended--
(1) in subsection (d)(13)--
(A) by striking ``at the option'' and all that
follows through ``subsection (m),'' and inserting
``(A)''; and
(B) by adding at the end ``or (B) the first $50 of
any child support payment in the month received if such
payment was made by the absent parent in the month when
due,''; and
(2) by striking subsection (m).
SEC. 1324. IMPROVING ACCESS TO EMPLOYMENT AND TRAINING ACTIVITIES.
(a) Dependent Care Deduction.--Section 5(e) of the Act (7 U.S.C.
2014(e)) is amended in clause (1) of the fourth sentence by--
(1) striking ``$160 a month for each dependent'' and
inserting ``$200 a month for a dependent child under 2 years of
age and $175 a month for any other dependent''; and
(2) striking ``, regardless of the dependent's age,''.
(b) Reimbursements to Participants in Employment and Training
Programs.--
(1) Costs other than costs of dependent care.--Section
6(d)(4)(I)(i)(I) of the Act (7 U.S.C. 2015(d)(4)(I)(i)(I)) is
amended by striking ``, except that'' and all that follows
through ``per month'' and inserting the following--
``(which may include reimbursements for costs of any supportive
services of the kinds provided or reimbursed under the State's
plan under part F of title IV of the Social Security Act (42
U.S.C. 681 et seq.)), except that State agencies may establish
limits on reimbursements to participants for such costs, which
limits may not be less than $25 per month''.
(2) Costs of dependent care.--Section 6(d)(4)(I)(i)(II) of
the Act (7 U.S.C. 2015(d)(4)(I)(i)(II)) is amended to read as
follows--
``(II) the actual costs of such dependent care expenses
that are determined by the State agency to be necessary for the
participation of an individual in the program (other than an
individual who is the caretaker relative of a dependent in a
family receiving benefits under part A of title IV of the
Social Security Act (42 U.S.C. 601 et seq.) in a local area
where an employment, training, or education program under title
IV of such Act is in operation, or was in operation, on the
date of enactment of the Hunger Prevention Act of 1988) up to
any limit set by the State agency (which limit shall not be
less than the limit for the dependent care deduction under
section 5(e)), but in no event shall such payment or
reimbursements exceed the applicable local market rate as
determined by procedures consistent with any such determination
under the Social Security Act. Individuals subject to the
program under this paragraph may not be required to participate
if dependent costs exceed the limit established by the State
agency under this subclause or other actual costs exceed any
limit established under subclause (I).''.
(c) Conforming Amendments.--Section 16(h)(3) of the Act (7 U.S.C.
2025(h)(3)) is amended by--
(1) striking ``$25'' and all that follows through
``dependent care costs)'', and inserting ``the payment made
under section 6(d)(4)(I)(i)(I) and subject to any limits the
State has established under such section''; and
(2) striking ``representing $160 per month per dependent''
and inserting ``equal to the payment made under section
6(d)(4)(I)(i)(II) but not more than the applicable local market
rate,''.
SEC. 1325. VEHICLES NEEDED TO SEEK AND CONTINUE EMPLOYMENT AND FOR
HOUSEHOLD TRANSPORTATION.
Section 5(g)(2) of the Act (7 U.S.C. 2014(g)(2)) is amended by
striking ``$4,500'' and inserting the following:
``a level set by the Secretary, which shall be $5,500 through September
30, 1994, and which shall be adjusted on each October 1 thereafter to
reflect changes in the new car component of the Consumer Price Index
for All Urban Consumers published by the Bureau of Labor Statistics for
the 12-month period ending on June 30 preceding the date of such
adjustment and rounded to the nearest $50''.
SEC. 1326. VEHICLES NECESSARY TO CARRY FUEL OR WATER.
Section 5(g)(2) of the Act (7 U.S.C. 2014(g)(2)) is amended by
adding at the end the following:
``The Secretary shall exclude from financial resources the value of a
vehicle that a household depends upon to carry fuel for heating or
water for home use when such transported fuel or water is the primary
source of fuel or water for the household.''.
SEC. 1327. DEMONSTRATION PROJECTS TESTING RESOURCE ACCUMULATION.
Section 17 of the Act (7 U.S.C. 2026) is amended by adding at the
end the following:
``(k) The Secretary may conduct, under such terms and conditions as
the Secretary may prescribe, for a period not to exceed 4 years,
demonstration projects to test allowing eligible households to
accumulate resources up to $10,000 for later expenditure for a purpose
directly related to improving the education, training, or employability
(including self employment) of household members, for the purchase of a
home for the household, for a change of the household's residence, or
for making major repairs to the household's home. The Secretary is
authorized to pay up to $100,000,000 in food stamp benefits to
households participating in such demonstration projects during the
period in which such projects are in operation.''.
CHAPTER 3--SIMPLIFYING THE PROVISION OF FOOD ASSISTANCE
SEC. 1331. SIMPLIFYING THE HOUSEHOLD DEFINITION FOR HOUSEHOLDS WITH
CHILDREN AND OTHERS.
Section 3(i) of the Act (7 U.S.C. 2012(i)) is amended--
(1) in the first sentence--
(A) by striking ``(2)'' and inserting ``or (2)'';
(B) by striking ``, or (3) a parent of minor
children and that parent's children'' and all that
follows through ``parents and children, or siblings,
who live together'', and inserting the following:
``. Spouses who live together, parents and their children 21
years of age or younger (who are not themselves parents living
with their children or married living with their spouses) who
live together, and children (excluding foster children) under
18 years of age who live with and are under the parental
control of a person other than their parent together with the
person exercising parental control''; and
(C) striking ``, unless one of '' and all that
follows through ``disabled member''; and
(2) in the second sentence by striking ``clause (1) of the
preceding sentence'' and inserting ``the preceding sentences''.
SEC. 1332. ELIGIBILITY OF CHILDREN OF PARENTS PARTICIPATING IN DRUG OR
ALCOHOL ABUSE TREATMENT PROGRAMS.
Section 3 of the Act (7 U.S.C. 2012) is amended--
(1) in the last sentence of subsection (i) by inserting ``,
together with their children,'' after ``narcotics addicts or
alcoholics''; and
(2) in subsection (g)(5) by inserting ``, and their
children,'' after ``or alcoholics''.
SEC. 1333. RESOURCES OF HOUSEHOLDS WITH DISABLED MEMBERS.
Section 5(g)(1) of the Act (7 U.S.C. 2014(g)(1)) is amended by
striking ``a member who is 60 years of age or older,'' and inserting
``an elderly or disabled member,''.
SEC. 1334. ENSURING ADEQUATE FUNDING FOR THE FOOD STAMP PROGRAM.
Section 18 of the Act (7 U.S.C. 2027) is amended by--
(1) striking the third and fourth sentences of subsection
(a)(1) and inserting the following--
``The Secretary shall, once every 3 months, submit a report to the
Committee on Agriculture of the House of Representatives and to the
Committee on Agriculture, Forestry, and Nutrition of the Senate setting
forth the Secretary's best estimate of the preceding quarter's
expenditure, including administrative costs, as well as the cumulative
totals for the fiscal year. In each quarterly report, the Secretary
shall also state whether there is reason to believe that supplemental
appropriations will be needed to support the operation of the program
through the end of the fiscal year.''; and
(2) striking subsections (b), (c), and (d) and
redesignating subsections (e) and (f) as subsections (b) and
(c), respectively.
CHAPTER 4--IMPROVING PROGRAM INTEGRITY
SEC. 1341. USE AND DISCLOSURE OF INFORMATION PROVIDED BY RETAIL FOOD
STORES AND WHOLESALE FOOD CONCERNS.
Section 9(c) of the Act (7 U.S.C. 2018(c)) is amended--
(1) in the second sentence by inserting after ``disclosed
to and used by'' the following:
``State and Federal law enforcement and investigative agencies for the
purposes of administering or enforcing the provisions of this Act or
any other Federal or State law and the regulations issued under this
Act or such law, and'';
(2) by inserting after the second sentence the following:
``An officer or employee of an agency described in the preceding
sentence who publishes, divulges, discloses, or makes known in any
manner or to any extent not authorized by Federal law any information
obtained under the authority granted by this subsection shall be
subject to section 1905 of title 18 of the United States Code.''; and
(3) in the last sentence by striking ``Such purposes shall
not exclude'' and inserting the following--
``Such regulations shall establish the criteria to be used by the
Secretary to determine that such information is needed. Such
regulations shall not prohibit''.
SEC. 1342. ADDITIONAL MEANS OF CLAIMS COLLECTION.
(a) Safeguards.--Section 11(e)(8) of the Act (7 U.S.C. 2020(e)(8))
is amended by--
(1) striking ``and (B)'' and inserting ``(B)''; and
(2) striking the semi-colon at the end and inserting the
following:
``, and (C) such safeguards shall not prevent the use by, or
disclosure of such information, to agencies of the Federal
Government (including the United States Postal Service) for
purposes of collecting the amount of an overissuance of
coupons, as determined under section 13(b) of this Act and
excluding claims arising from an error of the State agency,
that has not been recovered pursuant to such section, from
refunds of Federal taxes as authorized pursuant to section
3720A of title 31 of the United States Code, or from Federal
pay (including salaries and pensions) as authorized pursuant to
section 5514 of title 5 of the United States Code;''.
(b) Recovery.--Section 13 of the Act (7 U.S.C. 2022) is amended by
adding the following:
``(d) The amount of an overissuance of coupons (as determined under
subsection (b) and except for claims arising from an error of the State
agency) that has not been recovered pursuant to such subsection may be
recovered from refunds of Federal taxes, as authorized pursuant to
section 3720A of title 31 of the United States Code, or from Federal
pay (including salaries and pensions) as authorized by section 5514 of
title 5 of the United States Code.''.
SEC. 1343. DEMONSTRATION PROJECTS TESTING ACTIVITIES DIRECTED AT STREET
TRAFFICKING IN COUPONS.
Section 17 of the Act (7 U.S.C. 2026) is amended by adding a new
subsection (l) at the end thereof as follows--
``(l) The Secretary may use up to $4 million of funds provided in
advance in appropriations Acts for projects authorized by this section
in Fiscal Year 1994 to conduct projects in which State or local food
stamp agencies test innovative ideas for working with State or local
law enforcement agencies to investigate and prosecute coupon street
trafficking by recipients, buyers, and authorized retail stores.''.
CHAPTER 5--IMPROVING FOOD STAMP PROGRAM MANAGEMENT
SEC. 1351. CLARIFICATION OF CATEGORICAL ELIGIBILITY.
Effective on the date of enactment of this Act, section 5 of the
Act (7 U.S.C. 2014) is amended by--
(1) striking ``and the third sentence of section 3(i)''
each place it appears in subsection (a) and inserting the ``,
the third sentence of section 3(i), and section 20(f)''; and
(2) striking ``II,'' in subsection (j).
SEC. 1352. TECHNICAL AMENDMENTS RELATED TO ELECTRONIC BENEFIT TRANSFER.
(a) Eligibility Disqualification of Individuals.--Section
6(b)(1)(B) of the Act (7 U.S.C. 2015(b)(1)(B)) is amended by striking
``or authorization cards'' and inserting ``, authorization cards, or
access devices''.
(b) Eligibility Disqualification of Retail Food Stores and
Wholesale Food Concerns.--Section 12(b)(3)(B) of the Act (7 U.S.C.
2021(b)(3)(B)) is amended by--
(1) striking ``or authorization cards'' and inserting ``,
authorization cards, or access devices''; and
(2) striking ``or cards'' and inserting ``, cards, or
devices''.
SEC. 1353. DISQUALIFICATION OF RECIPIENTS FOR TRADING FIREARMS,
AMMUNITION, EXPLOSIVES, OR CONTROLLED SUBSTANCES FOR
COUPONS.
Section 6(b)(1) of the Act (7 U.S.C. 2015(b)(1)) is amended by
striking subdivisions (ii) and (iii) and inserting the following:
``(ii) for a period of 1 year upon--
``(I) the second occasion of any such
determination; or
``(II) the first occasion of a finding of the
trading of a controlled substance (as defined in
section 102 of the Controlled Substances Act (21 U.S.C.
802)); and
``(iii) permanently upon--
``(I) the third occasion of any such determination;
``(II) the second occasion of a finding of the
trading of a controlled substance (as defined in
section 102 of the Controlled Substances Act (21 U.S.C.
802)) for coupons; or
``(III) the first occasion of a finding of the
trading of firearms, ammunition, or explosives for
coupons.''.
SEC. 1354. UNCAPPED CIVIL MONEY PENALTY FOR TRAFFICKING IN COUPONS.
Effective on the date of enactment of this Act, section 12(b)(3)(B)
of the Act (7 U.S.C. 2021(b)(3)(B)) is amended by striking ``(except''
and all that follows through ``) in'', and inserting ``in''.
SEC. 1355. UNCAPPED CIVIL MONEY PENALTY FOR SELLING FIREARMS,
AMMUNITION, EXPLOSIVES, OR CONTROLLED SUBSTANCES FOR
COUPONS.
Effective on the date of enactment of this Act, section 12(b)(3)(C)
of the Act (7 U.S.C. 2021(b)(3)(C)) is amended--
(1) by striking ``substances (as the term is'' and
inserting ``substance (as''; and
(2) by striking ``(except'' and all that follows through
``) in'', and inserting ``in''.
SEC. 1356. MODIFYING THE FOOD STAMP QUALITY CONTROL SYSTEM.
(a) Amendments.--Section 16(c) of the Act (7 U.S.C. 2025(c)) is
amended--
(1) in paragraph (1)(C)--
(A) by striking ``payment error tolerance level''
and inserting ``national performance measure''; and
(B) by striking ``equal to'' and all that follows
through the period at the end, and inserting the
following:
``equal to--
``(i) the product of--
``(I) the value of all allotments issued by
the State agency in the fiscal year; times
``(II) the lesser of--
``(aa) the ratio of--
``(1) the amount by which
the State agency's payment
error rate for the fiscal year
exceeds the national
performance measure for the
fiscal year, to
``(2) the national
performance measure for the
fiscal year; or
``(bb) one; times
``(III) the amount by which the State
agency's payment error rate for the fiscal year
exceeds the national performance measure for
the fiscal year.
``(ii) The amount of liability shall not be
affected by corrective action under subparagraph
(B).'';
(2) in paragraph (3)(A) by striking ``60 days (or 90 days
at the discretion of the Secretary)'' and inserting ``120
days''; and
(3) in paragraph (6) by striking ``shall be used'' and all
that follows through ``level'' the last place it appears.
(b) Study by the Office of Technology Assessment.--The Office of
Technology Assessment shall undertake a study of measurement error, any
bias in penalty amounts, extreme value bias, regression formula, and of
geographical and temporal uniformity of measurements, in the food stamp
program quality control system, and shall report the results and
recommendations of such study to the Committee on Agriculture of the
House of Representatives and the Committee on Agriculture, Nutrition,
and Forestry of the Senate not later than 12 months after the date of
enactment of this Act.
(c) Study by the Secretary of Agriculture.--The Secretary of
Agriculture shall conduct a study of major causal factors which
contribute to the payment error rate. The Secretary shall also conduct
controlled experiments under which various reviewers review identical
cases, with the objective of determining the degree of uniformity in
quality control error-rate measurements and the extent to which
different levels of investment of resources in the review process
affect measurement error. The Secretary shall report the results and
recommendations (including recommendations as to what measures would
best reduce measurement error and increase uniformity of quality
control error-rate measurements at reasonable cost) of such study to
the Committee on Agriculture of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the Senate not
later than 2 years after the date of enactment of this Act.
CHAPTER 6--UNIFORM REIMBURSEMENT RATES
SEC. 1361. UNIFORM REIMBURSEMENT RATES.
(a) Amendments.--Section 16 of the Act (7 U.S.C. 2025) is amended--
(1) in subsection (a)--
(A) by striking ``and (5)'' and inserting ``(5)'';
(B) by inserting before the colon the following--
``, (6) automated data processing and information retrieval
systems subject to the conditions set forth in subsection (g),
(7) food stamp program investigations and prosecutions, and (8)
implementing and operating the immigration status verification
system under section 1137(d) of the Social Security Act (42
U.S.C. 1320b-7(d))''; and
(C) in the proviso by inserting after ``75 per
centum'' the following:
``through June 30, 1994, 70 percent for the 1-year period
beginning July 1, 1994, 60 percent for the 1-year period
beginning July 1, 1995, and 50 percent for any subsequent
period,'';
(2) in subsection (g)--
(A) by inserting ``through June 30, 1995, equal to
60 percent for the 1-year period beginning July 1,
1995, and 50 percent effective July 1, 1996,'' after
``1991,''; and
(B) by striking ``automatic'' and inserting
``automated''; and
(3) in subsection (j) by inserting after ``100 per centum''
the following:
``through June 30, 1994, 70 percent for the 1-year period beginning
July 1, 1994, 60 percent for the 1-year period beginning July 1, 1995,
and 50 percent for any subsequent period,''.
(b) Application of Amendments.--The reductions in enhanced Federal
match rates for administration resulting from the amendments made by
subsection (a) shall apply to payments to States for expenditures
incurred only after--
(1) the end of the State fiscal year that ends during 1994;
or
(2) in the case of a State with a State legislature which
is not scheduled to have a regular legislative session in 1994,
the end of the State fiscal year that ends during 1995;
without regard to whether or not final regulations to carry out such
amendments have been promulgated by the Secretary before the end of
either of such State fiscal years.
CHAPTER 7--IMPLEMENTATION AND EFFECTIVE DATES
SEC. 1371. IMPLEMENTATION AND EFFECTIVE DATES.
(a) General Effective Date and Implementation.--Except as otherwise
provided in this subtitle, this subtitle and the amendments made by
this subtitle shall take effect, and shall be implemented beginning on,
October 1, 1993.
(b) Special Effective Dates and Implementation.--(1) Sections 1312,
1315, 1316, 1317, 1322, 1323, 1326, 1331, 1333, and 1353 and the
amendments made by such sections shall take effect, and shall be
implemented beginning on, July 1, 1994.
(2) Paragraphs (1) and (3) of section 1356(a) and the amendments
made by such paragraphs shall take effect, and shall be implemented
beginning on, October 1, 1991.
(3) Paragraph (2) of section 1356(a) and the amendment made by such
paragraph shall take effect, and shall be implemented beginning on,
October 1, 1992.
Subtitle D--Miscellaneous Provisions
SEC. 1401. MAXIMUM EXPENDITURES UNDER MARKET PROMOTION PROGRAM FOR
FISCAL YEARS 1994 THROUGH 1998.
(a) Limitation.--Section 211(c)(1) of the Agricultural Trade Act of
1978 (7 U.S.C. 5641(c)) is amended by striking ``not less than
$200,000,000 for each of the fiscal years 1991 through 1995'' and
inserting ``an amount equal to $147,734,000 for each of the fiscal
years 1991 through 1998''.
(b) Application of Amendments.--The amendment made by this section
shall apply with respect to fiscal years beginning after September 30,
1993.
SEC. 1402. ADMISSION, ENTRANCE, AND RECREATION FEES.
(a) Authority To Impose Fees.--
(1) Entrance and admission fees.--The Secretary of
Agriculture may charge admission or entrance fees at National
Monuments, National Volcanic Monuments, National Scenic Areas,
and areas of concentrated public use administered by the
Secretary.
(2) Recreation use fees.--The Secretary may charge
recreation use fees at lands administered by the Secretary in
connection with the use of specialized outdoor recreation
sites, equipment, services, or facilities, including visitors'
centers, picnic tables, boat launching facilities, or
campgrounds.
(b) Amount of Fees.--The amount of the admission, entrance, and
recreation fees authorized to be imposed under this section shall be
determined by the Secretary.
(c) Definitions.--For purposes of this section:
(1) The term ``area of concentrated public use'' means an
area administered by the Secretary that meets each of the
following criteria:
(A) The area is managed primarily for outdoor
recreation purposes.
(B) Facilities and services necessary to
accommodate heavy public use are provided in the area.
(C) The area contains at least one major recreation
attraction.
(D) Public access to the area is provided in such a
manner that admission fees can be efficiently collected
at one or more centralized locations.
(2) The term ``boat launching facility'' includes any boat
launching facility regardless of whether specialized facilities
or services, such as mechanical or hydraulic boat lifts or
facilities, are provided.
(3) The term ``campground'' means any campground where a
majority of the following amenities are provided, as determined
by the Secretary:
(A) Tent or trailer spaces.
(B) Drinking water.
(C) An access road.
(D) Refuse containers.
(E) Toilet facilities.
(F) The personal collection of recreation use fees
by an employee or agent of the Secretary.
(G) Reasonable visitor protection.
(H) If campfires are permitted in the campground,
simple devices for containing the fires.
(4) The term ``Secretary'' means the Secretary of
Agriculture.
SEC. 1403. ADDITIONAL PROGRAM CHANGES TO MEET RECONCILIATION
REQUIREMENTS.
The Secretary of Agriculture shall consolidate personnel and field,
regional, and national offices of agencies within the Department of
Agriculture in order to reduce personnel and duplicative overhead
expenses as a result of the consolidation such that Department
expenditures are reduced by--
(1) $90,000,000 in fiscal year 1995;
(2) $97,000,000 in fiscal year 1996;
(3) $135,000,000 in fiscal year 1997; and
(4) $178,000,000 in fiscal year 1998.
SEC. 1404. ENVIRONMENTAL CONSERVATION ACREAGE RESERVE PROGRAM
AMENDMENTS.
(a) Enrollment Requirement.--
(1) Conservation reserve program.--
(A) In general.--Section 1231(d) of the Food
Security Act of 1985 (16 U.S.C. 3831(d)) is amended--
(i) by striking ``the amount of acres
specified in section 1230(b)'' and inserting
``a total of not more than 38,000,000 acres
during the 1986 through 1995 calendar years'';
and
(ii) by striking ``each of calendar years
1994 and 1995'' and inserting ``the 1995
calendar year''.
(B) Conforming amendment.--Section 1230(b) of such
Act (16 U.S.C. 3830(b)) is amended by striking ``to
place in'' and all that follows through ``acres''.
(2) Wetlands reserve program.--
(A) In general.--Section 1237(b) of such Act (16
U.S.C. 3837(b)) is amended to read as follows:
``(b) Minimum Enrollment.--The Secretary shall enroll into the
wetlands reserve program--
``(1) a total of not less than 330,000 acres by the end of
the 1995 calendar year; and
``(2) a total of not less than 975,000 acres during the
1991 through 2000 calendar years.''.
(B) Conforming amendment.--Section 1237(c) of such
Act (16 U.S.C. 3837(c)) is amended by striking ``1995''
and inserting ``2000''.
(b) Use of Commodity Credit Corporation.--Section 1241 of such Act
(16 U.S.C. 3841) is amended--
(1) in subsection (a)--
(A) by striking ``(a)(1) During each of the fiscal
years ending September 30, 1986, and September 30,
1987'' and inserting ``(a) During each of the fiscal
years 1994 through 2000''; and
(B) by striking paragraph (2); and
(2) in subsection (b), by striking ``(A) through (E)'' and
inserting ``A through E''.
SEC. 1405. LEVELS OF INSURANCE COVERAGE UNDER THE FEDERAL CROP
INSURANCE ACT.
(a) Conversion of Program to Four Levels of Coverage.--The Federal
Crop Insurance Act is amended--
(1) in subsection (a) of section 508 (7 U.S.C. 1508)--
(A) in the first sentence, by striking ``If
sufficient actuarial data are available, as determined
by the Board,'' and inserting ``Subject to section
508B, based on the actuarial and underwriting data
available to the Board,''; and
(B) by striking the fifth, sixth, seventh, eighth,
ninth, tenth, fourteenth, fifteenth, and sixteenth
sentences; and
(2) by inserting after section 508A (7 U.S.C. 1508a) the
following new section:
``SEC. 508B. FOUR LEVELS OF CROP INSURANCE COVERAGE.
``(a) Four Levels of Coverage.--In making crop insurance available
under section 508 to producers of agricultural commodities grown in the
United States, the Corporation shall make available four levels of
insurance coverage against losses in yields of the insured commodity:
``(1) Level i.--Coverage level I shall be available only to
those producers who do not purchase insurance at coverage
levels II, III, or IV and shall provide for the indemnification
of those producers for losses in yield to the extent that such
losses exceed 65 percent of the determined yield of the
commodity for the farm, as established under subsection (b).
``(2) Levels ii, iii, and iv.--Coverage levels II, III, and
IV shall provide for the indemnification of producers for those
losses in yield to the extent that such losses exceed 50, 35,
and 25 percent, respectively, of--
``(A) the average proven yield on the farm for a
representative period based on the actual production
history of the farm, as determined from the producer's
records; or
``(B) if such records are not available or are
insufficient, the recorded or appraised average yield
of the commodity on the farm for a representative
period, subject to such adjustments as the Board may
prescribe to ensure that the average yield for farms in
the same area, which are subject to the same
conditions, are fair and just.
``(b) Determined Yield.--For purposes of subsection (a)(1), the
determined yield for a commodity shall be equal to--
``(1) in the case of a crop of any commodity for which the
Agricultural Stabilization and Conservation Service establishes
a yield for the farm, the yield so established; and
``(2) in the case of a crop of any other commodity, the
recorded or appraised average yield of the commodity on the
farm for a representative period, subject to such adjustments
as the Board may prescribe to ensure that the average yield for
farms in the same area, which are subject to the same
conditions, are fair and just.
``(c) Use of ASCS Yield.--If the Agricultural Stabilization and
Conservation Service has established a yield for a crop of a commodity
for a farm and such yield is higher than the yield determined for the
farm under subsection (a)(2) for coverage levels II, III, or IV, the
producer may elect to use such higher yield for purpose of coverage
levels II, III, and IV. Use of such higher yield shall be subject to an
additional premium for the coverage at such a rate as the Board
determines appropriate to accurately reflect the increased risk
involved and that the Board determines to be actuarially sufficient to
cover claims for losses on such insurance and to establish a reasonable
reserve against unforeseen losses. No premium subsidy or administrative
subsidy may be provided by the Corporation in connection with any
additional coverage provided under this subsection.
``(d) Price Elections.--The Corporation shall establish a high and
low price election for each agricultural commodity for which insurance
is available under this title. The high price shall not be less than
the projected market price of the commodity. Coverage levels II, III,
and IV shall be available to producers at any price election that is
equal to or less than the high price election and shall be quoted in
terms of dollars per acre coverage that may be purchased. Coverage
level I shall be offered only at the low price election.
``(e) Coverage and Price Information.--The Corporation shall ensure
that each producer is provided accurate and adequate information at the
time of application regarding the amount of coverage available at each
level of coverage for the commodity to be insured and the cost to the
producer for such coverage.
``(f) Annual Report.--The Corporation shall report annually to the
Congress the results of its operations regarding each commodity for
which insurance is available under this title. The report shall include
for each insured commodity a description of operations under this
section at each level of coverage.''.
(b) Premium Payment.--Subsection (e)(3) of section 508 of the
Federal Crop Insurance Act (7 U.S.C. 1508) is amended to read as
follows:
``(3) For the purpose of encouraging the broadest possible
participation in the crop insurance program, the Corporation shall
pay--
``(A) with respect to each policy providing for coverage
level I, the full amount of the premium for such coverage; and
``(B) with respect to each policy providing for coverage
level II, III, or IV, the portion of the premium that is equal
to the amount that would have been paid under subparagraph (A)
if the producer had elected coverage level I.''.
(c) Reinsurance.--Subsection (h) of section 508 of the Federal Crop
Insurance Act (7 U.S.C. 1508) is amended to read as follows:
``(h) Reinsurance.--The Corporation shall provide reinsurance, to
the maximum extent practicable, upon such terms and conditions as the
Board may determine to be consistent with subsections (a) and (b) and
with sound reinsurance principles promulgated pursuant to the Office of
Federal Procurement Policy Act (41 U.S.C. 401, et seq.), which the
Board shall modify as necessary to conform to the purposes of this Act,
taking into account the expenses of the Corporation paid on its own
policies of insurance. Reinsurance shall be provided to insurers
including private insurance companies or pools of such companies,
reinsurers of such companies, or State or local governmental entities,
including any political subdivisions thereof, that insure producers of
any agricultural commodity under a plan or plans acceptable to the
Corporation. However, in the case of the sale of coverage level I
policies only (but not for the processing and adjustment of claims on
those policies), contractors of the Corporation shall be paid only $50
per policy, of which $25.50 shall be paid by the policyholder at the
time of application and $24.50 shall be paid by the Corporation.
Whenever the Corporation provides reinsurance under this subsection to
any such insurers, the Corporation shall pay (as provided in subsection
(e)) the portion of the producer's premium for such insurance so
reinsured. Insurers of policies on which reinsurance is provided shall
make use of licensed private insurance agents and brokers on the same
basis as provided for policies of the Corporation under section
507(c)(3) of this title, except that the provisions for compensating
agents and brokers from premiums paid by the insured shall not apply.
The Corporation shall periodically revise its reinsurance agreement
with the reinsured companies to provide for the reinsured companies to
bear an increased share of any potential loss under such agreement, in
cases in which the financial conditions of the reinsured companies and
the availability of private reinsurance so permits.''.
(d) Application of Amendments.--The amendments made by this section
shall apply beginning with crops to be harvested in 1995.
TITLE II--COMMITTEE ON ARMED SERVICES
SEC. 2001. LIMITATION ON COST-OF-LIVING ADJUSTMENTS FOR MILITARY
RETIREES.
Paragraph (2) of section 1401a(b) of title 10, United States Code,
is amended to read as follows:
``(2) Pre-august 1, 1986 members.--
``(A) General rule.--The Secretary shall increase
the retired pay of each member and former member who
first became a member of a uniformed service before
August 1, 1986, by the percent (adjusted to the nearest
one-tenth of 1 percent) by which--
``(i) the price index for the base quarter
of that year, exceeds
``(ii) the base index.
``(B) Special rule for fiscal years 1994 through
1998.--In the case of the increases in retired pay
that, pursuant to paragraph (1), become effective on
December 1 of each of fiscal years 1994, 1995, 1996,
1997, and 1998, the initial month for which each such
increase is payable as part of such retired pay shall
(notwithstanding such December 1 effective date) be as
set forth in the following table:
First month for which
``Fiscal year:
increase is payable:
1994......................... April 1994.
1995......................... July 1995.
1996......................... October 1996.
1997......................... January 1998.
1998......................... April 1999.
``(C) Exclusion of disability retirees from rolling
cola.--Subparagraph (B) does not apply with respect to
the retired pay of a member retired under chapter 61 of
this title.''.
SEC. 2002. ELIMINATION OF MILITARY PAY RAISE FOR FISCAL YEAR 1994 AND
REDUCTION IN THE AMOUNT OF THE RAISE FOR FISCAL YEARS
1995 THROUGH 1998.
(a) Fiscal Year 1994.--During fiscal year 1994, no increase in the
rates of basic pay, basic allowance for quarters, or basic allowance
for subsistence of members of the uniformed services shall be made or
take effect pursuant to section 1009 of title 37, United States Code.
(b) One Percent Reduction in Subsequent Fiscal Years.--If the
General Schedule of compensation for Federal classified employees is
increased under section 5303 of title 5, United States Code, as amended
by title X of this Act, during fiscal year 1995, 1996, 1997, or 1998,
the elements of compensation of members of the uniformed services shall
likewise be increased during that fiscal year in the manner provided in
section 1009 of title 37, United States Code, based on the
corresponding increase under section 5303 of title 5, United States
Code (as so amended).
TITLE III--COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS
SEC. 3001. NATIONAL DEPOSITOR PREFERENCE.
(a) In General.--Section 11(d)(11) of the Federal Deposit Insurance
Act (12 U.S.C. 1821(d)(11)) is amended to read as follows:
``(11) Depositor preference.--
``(A) In general.--Subject to section 5(e)(2)(C),
amounts realized from the liquidation or other
resolution of any insured depository institution by any
receiver appointed for such institution shall be
distributed to pay claims (other than secured claims to
the extent of any such security) in the following order
of priority:
``(i) Administrative expenses of the
receiver.
``(ii) Any deposit liability of the
institution.
``(iii) Any claim of an employee of the
institution, other than a senior executive
officer (as defined by the Corporation pursuant
to section 32(f)), for pay accrued but unpaid
as of the date the receiver was appointed for
the institution.
``(iv) Any other general or senior
liability of the institution (which is not a
liability described in clause (v) or (vi)).
``(v) Any obligation subordinated to
depositors or other general creditors (which is
not an obligation described in clause (vi)).
``(vi) Any obligation to shareholders
arising as a result of their status as
shareholders (including any depository
institution holding company or any shareholder
or creditor of such company).
``(B) Effect on state law.--
``(i) In general.--The provisions of
subparagraph (A) shall not supersede the law of
any State except to the extent such law is
inconsistent with the provisions of such
subparagraph, and then only to the extent of
the inconsistency.
``(ii) Procedure for determination of
inconsistency.--Upon the Corporation's own
motion or upon the request of any person with a
claim described in subparagraph (A)(i) or any
State which is submitted to the Corporation in
accordance with procedures which the
Corporation shall prescribe, the Corporation
shall determine whether any provision of the
law of any State is inconsistent with any
provision of subparagraph (A) and the extent of
any such inconsistency.
``(iii) Judicial review.--The final
determination of the Corporation under clause
(ii) shall be subject to judicial review under
chapter 7 of title 5, United States Code.
``(C) Accounting report.--Any distribution by the
Corporation in connection with any claim described in
subparagraph (A)(vi) shall be accompanied by the
accounting report required under paragraph (15)(B).''.
(b) Technical and Conforming Amendments.--
(1) Section 11(c)(13) of the Federal Deposit Insurance Act
(12 U.S.C. 1821(c)(13)) is amended--
(A) in subparagraph (A), by striking ``subject to
subparagraph (B),'';
(B) in inserting ``and'' after the semicolon at the
end of subparagraph (A);
(C) by striking subparagraph (B); and
(D) by redesignating subparagraph (C) as
subparagraph (B).
(2) Section 11(g)(4) of the Federal Deposit Insurance Act
(12 U.S.C. 1921(g)(4)) is amended by striking ``If the
Corporation'' and inserting ``Subject to subsection (d)(11), if
the Corporation''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to insured depository institutions for which a
receiver is appointed after the date of the enactment of this Act.
SEC. 3002. TRANSFER OF FEDERAL RESERVE SURPLUSES.
(a) In General.--The 1st undesignated paragraph of section 7 of the
Federal Reserve Act (12 U.S.C. 289) is amended to read as follows:
``(a) Dividends and Surplus Funds of Reserve Banks.--
``(1) Stockholder dividends.--
``(A) In general.--After all necessary expenses of
a Federal reserve bank have been paid or provided for,
the stockholders of the bank shall be entitled to
receive an annual dividend of 6 percent on paid-in
capital stock.
``(B) Dividend cumulative.--The entitlement to
dividends under subparagraph shall be cumulative.
``(2) Deposit of net earnings in surplus fund.--That
portion of net earnings of each Federal reserve bank which
remains after dividend claims under subparagraph (A) have been
fully met shall be deposited in the surplus fund of the bank.
``(3) Payment to treasury.--During fiscal years 1994
through 1998, any amount in the surplus fund of any Federal
reserve bank in the excess of the amount equal to 3 percent of
the total paid-in capital and surplus of the member banks of
such bank shall be transferred to the Board for transfer to the
Secretary of the Treasury for deposit in the general fund of
the Treasury.''.
(b) Additional Transfers for Fiscal Years 1997 and 1998.--
(1) In general.--In addition to the amounts required to be
transferred from the surplus funds of the Federal reserve banks
pursuant to section 7(a)(3) of the Federal Reserve Act, the
Federal reserve banks shall transfer from such surplus funds to
the Board of Governors of the Federal Reserve System for
transfer to the Secretary of the Treasury for deposit in the
general fund of the Treasury, a total amount of $106,000,000 in
fiscal year 1997 and a total amount of $107,000,000 in fiscal
year 1998.
(2) Allocation by fed.--Of the total amount required to be
paid by the Federal reserve banks under paragraph (1) for
fiscal year 1997 or 1998, the Board of Governors of the Federal
Reserve System shall determine the amount each such bank shall
pay in such fiscal year.
(3) Replenishment of surplus fund prohibited.--No Federal
reserve bank may replenish such bank's surplus fund by the
amount of any transfer by such bank under paragraph (1) during
the fiscal year for which such transfer is made.
(c) Technical and Conforming Amendments.--
(1) The penultimate undesignated paragraph of section 7 of
the Federal Reserve Act (12 U.S.C. 290) is amended by striking
``The net earnings derived'' and inserting ``(b) Use of
Earnings Transferred to the Treasury.--The net earnings
derived''.
(2) The last undesignated paragraph of section 7 of the
Federal Reserve Act (12 U.S.C. 531) is amended by striking
``Federal reserve banks'' and inserting ``(c) Exemption From
Taxation.--Federal reserve banks''.
SEC. 3003. USE OF RETURN DATA FOR INCOME VERIFICATION UNDER CERTAIN
HOUSING ASSISTANCE PROGRAMS.
Section 904 of the Stewart B. McKinney Homeless Assistance
Amendments Act of 1988 (42 U.S.C. 3544) is amended as follows:
(1) Consent forms.--In subsection (b)--
(A) in the matter preceding paragraph (1), by
inserting ``(including the Indian housing program under
title II of the United States Housing Act of 1937)''
before the 1st comma;
(B) in paragraph (1), by striking ``and'' at the
end;
(C) in paragraph (2), by striking the period at the
end and inserting ``; and'';
(D) by inserting after paragraph (2) the following
new paragraph:
``(3) sign a consent from approved by the Secretary
authorizing the Secretary to request the Commissioner of Social
Security and the Secretary of the Treasury to release
information pursuant to section 6103(l)(7)(D)(ix) of the
Internal Revenue Code of 1986 with respect to such applicant or
participant for the sole purpose of the Secretary verifying
income information pertinent to the applicant's or
participant's eligibility or level of benefits.''; and
(E) in the last sentence, by striking ``This'' and
inserting the following: ``Except as provided in this
subsection, this''.
(2) Applicant and participant protections.--In subsection
(c)(2)--
(A) in subparagraph (A)--
(i) in the matter preceding clause (i)--
(I) by inserting after
``compensation law'' the following:
``or pursuant to section
6103(i)(7)(D)(ix) of the Internal
Revenue Code of 1986 from the
Commissioner of Social Security or the
Secretary of the Treasury''; and
(II) by inserting ``(in the case of
information obtained pursuant to such
section 303(i))'' before
``representatives''; and
(ii) in clause (ii), by inserting ``or
public housing agency'' after ``owner'' each
place it appears;
(B) in subparagraph (B), by inserting after
``wages'' each place it appears the following: ``,
other earnings or income,''; and
(C) in subparagraph (C), by inserting before the
second comma the following: ``at a hearing that
provides the basic elements of due process''.
(3) Penalty.--In subsection (c)(3)--
(A) in subparagraph (A), by inserting ``or section
6103(l)(7)(D)(ix) of the Internal Revenue Code of
1986'' after ``Social Security Act''; and
(B) in the first sentence of subparagraph (B)--
(i) by striking clause (i) and inserting
the following: ``(i) a negligent or knowing
disclosure of information referred to in this
section, section 303(i) of the Social Security
Act, or section 6103(l)(7)(D)(ix) of the
Internal Revenue Code of 1986 about such person
by an officer or employee of any public housing
agency or owner (or employee thereof), which
disclosure is not authorized by this section,
such section 303(i), such section
6103(l)(7)(D)(ix), or any regulation
implementing this section, such section 303(i),
or such section 6103(l)(7)(D)(ix), or''; and
(ii) in clause (ii), by inserting ``such
6103(l)(7)(D)(ix),'' after ``303(i),''.
(4) Conforming amendment.--The heading of subsection (c) of
section 904 of the Stewart B. McKinney Homeless Assistance
Amendments Act of 1988 is amended by striking ``State
Employment''.
SEC. 3004. GNMA REMIC GUARANTEE FEES.
Section 306(g)(3) of the National Housing Act (12 U.S.C.
1721(g)(3)) is amended by adding at the end the following new
subparagraph:
``(E)(i) Notwithstanding subparagraphs (A) through (D), fees
charged for the guaranty of, or commitment to guaranty, multiclass
securities backed by a trust or pool of securities or notes guaranteed
by the Association under this subsection and other related fees shall
be charged by the Association in an amount not to exceed the value, as
determined by the Association, of the guarantee or commitment to
guarantee. The Association shall take such action as may be necessary
to reasonably assure that such portion of the value of the guaranties
or commitments to guaranty as the Association determines is appropriate
accrues to the benefit of mortgagors under mortgages executed after the
date of the enactment of this subparagraph by or upon which such
securities or notes are backed.
``(ii) For each Federal fiscal year, the Association shall submit a
report to the Congress describing any activities of the Association
with respect to guarantying and making commitments to guaranty
multiclass securities described in clause (i). The report shall be
submitted not later than 90 days after the end of the fiscal year for
which the report is made and shall identify the extent of such
activities during the fiscal year, the size of each transaction closed
during the fiscal year involving such securities, the number of
mortgages involved in each such transaction, the amount of the fees
charged and earned by the Association for such transactions, and any
persons receiving payments for any services provided with respect to
any such transactions and the amounts of such payments, and shall
include an estimate of the portion of the value of the guarantee or
commitment to guarantee accruing to the benefit of mortgagors and a
description of any action taken by the Association to ensure such
accrual.
``(iii) The Association shall provide for the initial
implementation of the program for which fees are charged under the
first sentence of clause (i) by notice published in the Federal
Register. The notice shall be effective upon publication and shall
provide an opportunity for public comment. Not later than 12 months
after publication of the notice, the Association shall issue
regulations for such program based on the notice, comments received,
and the experience of the Association in carrying out the program
during such period.''.
SEC. 3005. MUTUAL MORTGAGE INSURANCE FUND PREMIUMS.
To improve the actuarial soundness of the Mutual Mortgage Insurance
Fund under the National Housing Act, the Secretary of Housing and Urban
Development shall increase the rate at which the Secretary earns the
single premium payment collected at the time of insurance of a mortgage
that is an obligation of such Fund (with respect to the rate in effect
on the date of the enactment of this Act). In establishing such
increased rate, the Secretary shall consider any current audit findings
and reserve analyses and information regarding the expected average
duration of mortgages that are obligations of such Fund and may
consider any other information that the Secretary determines to be
appropriate.
TITLE IV--EDUCATION AND LABOR
SEC. 4000. TABLE OF CONTENTS.
The table of contents of this title is as follows:
TITLE IV--EDUCATION AND LABOR
Sec. 4000. Table of contents.
Subtitle A--Federal Direct Loan Program
Chapter 1--Amendments to Part D of Title IV of the Higher Education Act
of 1965
Sec. 4001. Short title; references.
Sec. 4002. Federal Direct Student Loan Program.
Chapter 2--Conforming Amendments
Sec. 4021. Preserving loan access.
Sec. 4022. Guaranty agency reserves.
Sec. 4023. Terms of loans.
Sec. 4024. Assignment of loans.
Sec. 4025. Termination of guaranty agency agreements; assumption of
guaranty agency functions by the Secretary.
Sec. 4026. Administrative cost allowance.
Sec. 4027. Consolidation loans.
Sec. 4028. Student Loan Marketing Association.
Sec. 4029. Authority to use optically imaged documents.
Sec. 4030. Amendment to the Balanced Budget and Emergency Deficit
Control Act of 1985.
Chapter 3--Effective Dates; Study
Sec. 4031. Effective dates.
Sec. 4032. Study of Internal Revenue Service collection of student
loans.
Sec. 4033. Preference of committee for IRS collection mechanism.
Subtitle B--Cost Sharing by States
Sec. 4101. Cost sharing by States.
Subtitle C--ERISA Amendments Relating to Group Health Plans
Sec. 4201. Coordination of ERISA preemption rules with title XIX
provisions providing for liability of third
parties.
Sec. 4202. Continued coverage of costs of a pediatric vaccine under
group health plans.
Sec. 4203. Temporary rules governing preemption of certain State laws.
Subtitle A--Federal Direct Loan Program
CHAPTER 1--AMENDMENTS TO PART D OF TITLE IV OF THE HIGHER EDUCATION ACT
OF 1965
SEC. 4001. SHORT TITLE; REFERENCES.
(a) Short Title.--This subtitle may be cited as the ``Student Loan
Reform Act of 1993''.
(b) References.--References in this subtitle to ``the Act'' are
references to the Higher Education Act of 1965 (20 U.S.C. 1001 et
seq.).
SEC. 4002. FEDERAL DIRECT STUDENT LOAN PROGRAM.
Part D of title IV of the Act (20 U.S.C. 1087a et seq.) is amended
to read as follows:
``PART D--FEDERAL DIRECT STUDENT LOAN PROGRAM
``SEC. 451. PURPOSE; PROGRAM AUTHORIZATION.
``(a) Purpose.--It is the purpose of this part--
``(1) to simplify the delivery of student loans to
borrowers and eliminate borrower confusion;
``(2) to provide a variety of repayment plans, including
income contingent repayment through the EXCEL Account, to
borrowers so that they have flexibility in managing their
student loan repayment obligations, and so that those
obligations do not foreclose community service-oriented career
choices for those borrowers;
``(3) to replace, through an orderly transition, the
Federal Family Education Loan Program under part B of this
title with the Federal Direct Student Loan Program under this
part;
``(4) to avoid the unnecessary cost, to taxpayers and
borrowers, and administrative complexity associated with the
Federal Family Education Loan Program under part B of this
title through the use of a direct student loan program; and
``(5) to create a more streamlined student loan program
that can be managed more effectively at the Federal level.
``(b) Program Authority.--There are hereby made available, in
accordance with the provisions of this part, such sums as may be
necessary to make loans to all eligible students in attendance at
participating institutions of higher education selected by the
Secretary (and the eligible parents of such students), to enable such
students to pursue their courses of study at such institutions during
the period beginning July 1, 1994. Such loans shall be made by
participating institutions that have agreements with the Secretary to
originate loans, or by alternative originators designated by the
Secretary to make loans for students in attendance at participating
institutions (and their parents).
``SEC. 452. FUNDS FOR ORIGINATION OF DIRECT STUDENT LOANS.
``(a) In General.--The Secretary shall provide, on the basis of the
need and the eligibility of students at each participating institution,
and parents of such students, for such loans, funds for student and
parent loans under this part--
``(1) directly to an institution of higher education that
has an agreement with the Secretary under section 454(a) to
participate in the direct student loan programs under this part
and that also has an agreement with the Secretary under section
454(b) to originate loans under this part, or
``(2) through an alternative originator designated by the
Secretary to students and parents of students attending
institutions of higher education that have an agreement with
the Secretary under section 454(a) but that do not have an
agreement with the Secretary under section 454(b).
``(b) Fees for Origination Services.--
``(1) Fees for institutions.--The Secretary shall pay fees
to institutions of higher education (or a consortium of such
institutions) with agreements under section 454(b), in an
amount established by the Secretary, to assist in meeting the
costs of loan origination. Such fees--
``(A) shall be paid by the Secretary based on all
the loans made under this part to a particular borrower
in the same academic year;
``(B) shall be subject to a sliding scale that
decreases the amount of such fees as the number of
borrowers increases; and
``(C)(i) for academic year 1994-1995, shall not
exceed a program-wide average of $10 per borrower for
all the loans made under this part in the same academic
year; and
``(ii) for succeeding academic years, shall not
exceed such average fee as the Secretary shall
establish in regulations.
``(2) Fees for alternative originators.--The Secretary
shall pay fees for loan origination services to alternative
originators of loans made under this part in an amount
established by the Secretary in accordance with the terms of
the contract between the Secretary and each such alternative
originator.
``(c) No Entitlement To Participate or Originate.--No institution
of higher education shall have a right to participate in the programs
authorized by this part, to originate loans, or to perform any program
function under this part. Nothing in this subsection shall be construed
so as to limit the entitlement of an eligible student attending a
participating institution (or the eligible parent of such student) to
borrow under this part.
``SEC. 453. SELECTION OF INSTITUTIONS FOR PARTICIPATION AND
ORIGINATION.
``(a) Phase-in of Program.--
``(1) General authority.--The Secretary shall enter into
agreements pursuant to section 454(a) with institutions of
higher education to participate in the direct student loan
programs under this part, and agreements pursuant to section
454(b) with institutions of higher education to originate loans
in such programs, for academic years beginning on or after July
1, 1994. Alternative origination services, through which an
entity other than the participating institution at which the
student is in attendance originates the loan, shall be provided
by the Secretary, through one or more contracts under section
456 or such other means as the Secretary may provide, for
students attending participating institutions that do not
originate direct student loans under this part. Such agreements
for the first year of the program shall, to the extent
feasible, be entered into not later than January 1, 1994.
``(2) Transition provisions.--In order to ensure an
expeditious but orderly transition from the loan programs under
part B of this title to the direct student loan programs under
this part, the Secretary shall, in the exercise of his or her
discretion, determine the number of institutions with which he
or she shall enter into agreements under sections 454 (a) and
(b) for any academic year, except that the Secretary shall
exercise such discretion so as to achieve the following goals:
``(A) for academic year 1994-1995, loans made under
this part shall represent 4 percent of the sum of new
student loan volume under this part and part B of this
title;
``(B) for academic year 1995-1996, loans made under
this part shall represent 25 percent of the sum of new
student loan volume under this part and part B of this
title;
``(C) for academic year 1996-1997, loans made under
this part shall represent 60 percent of the sum of new
student loan volume under this part and part B of this
title; and
``(D) for academic year 1997-1998, loans made under
this part shall represent 100 percent of the sum of new
student loan volume under this part and part B of this
title.
``(3) Cash management.--The requirements of the Cash
Management Improvement Act of 1990 (Public Law 101-453) shall
apply to the program under this part only to the extent
specified in a schedule established by the Secretaries of
Education and the Treasury, except that such schedule shall
provide for the application of all such requirements not later
than July 1, 1998.
``(b) Selection Criteria for Participation.--
``(1) Application.--Each institution of higher education
desiring to participate in the direct student loan program
under this part shall submit an application satisfactory to the
Secretary containing such information and assurances as the
Secretary may require.
``(2) Agreement.--When the program authorized under this
part is fully implemented, the Secretary shall enter into
agreements under section 454(a) with institutions that submit
applications in accordance with paragraph (1).
``(3) Transition selection criteria.--Until such full
implementation, the Secretary shall select institutions for
participation in the direct student loan program under this
part, and shall enter into agreements with them under section
454(a), from among those institutions that submit the
applications described in paragraph (1), and meet such other
eligibility requirements as the Secretary may prescribe, by--
``(A)(i) categorizing such institutions according
to anticipated loan volume, length of academic program,
and control of the institution; and
``(ii) selecting institutions that are reasonably
representative of the respective categories; and
``(B) if needed to carry out the purposes of this
part, selecting additional institutions.
``(c) Selection Criteria for Origination.--
``(1) In general.--The Secretary may enter into a
supplemental agreement with an institution (or a consortium of
such institutions) that--
``(A) has an agreement under subsection 454(a);
``(B) desires to originate loans under this part;
and
``(C) meets the criteria specified in paragraph
(2).
``(2) Transition selection criteria.--For academic year
1994-1995, the Secretary may approve an institution to
originate loans only if such institution--
``(A) made loans under part E of this title in
academic year 1993-1994 and did not exceed the
applicable maximum default rate under section 464(g)
for the most recent fiscal year for which data are
available;
``(B) is not on the reimbursement system of payment
for any of the programs under subpart 1 or 3 of part A,
part C, or part E;
``(C) is not overdue on program or financial
reports or audits required under this title;
``(D) is not subject to an emergency action, or a
limitation, suspension, or termination under section
428(b)(1)(T), 432(h), or 487(c);
``(E) in the opinion of the Secretary, has not had
significant deficiencies identified by the State
postsecondary review entity under subpart 1 of part H
of this title;
``(F) in the opinion of the Secretary, has not had
severe performance deficiencies for any of the programs
under this title, including those demonstrated by
audits or program reviews submitted or conducted during
the 5 calendar years immediately preceding the date of
application;
``(G) provides an assurance that it has no
delinquent outstanding debts to the United States,
unless such debts are being repaid under or in
accordance with a repayment arrangement satisfactory to
the United States, or the Secretary in his or her
discretion determines that the existence or amount of
such debts has not been finally determined by the
cognizant Federal agency or agencies; and
``(H) meets such other criteria as the Secretary
may establish to protect the financial interest of the
United States and to promote the purposes of this part.
``(3) Regulations governing approval after transition.--For
academic year 1995-1996 and subsequent academic years, the
Secretary shall publish regulations governing the approval of
institutions to originate loans.
``(d) Consortia.--Subject to such requirements as the Secretary may
prescribe, eligible institutions of higher education with agreements
under section 454(a) may apply as consortia to originate loans under
this part for students in attendance at such institutions. Such
institutions shall each be required to meet the requirements of
subsection (c) with respect to loan origination.
``SEC. 454. AGREEMENTS WITH INSTITUTIONS.
``(a) Participation Agreements.--An agreement with any institution
of higher education for participation in the direct student loan
program under this part shall--
``(1) provide for the establishment and maintenance of a
direct student loan program at the institution under which the
institution will--
``(A) identify eligible students who seek student
financial assistance at such institution in accordance
with section 484;
``(B) estimate the need of each such student as
required by part F of this title for an academic year,
provided that any loan obtained by a student under this
part with the same terms (except as otherwise provided
in this part) as loans made under section 428A or 428H,
or a loan obtained by a parent under this part with the
same terms (except as otherwise provided in this part)
as loans made under section 428B, or obtained under any
State-sponsored or private loan program, may be used to
offset the expected family contribution of the student
for that year;
``(C) provide a statement that certifies the
eligibility of any student to receive a loan under this
part that is not in excess of the annual or aggregate
limit applicable to the amount of such loan, except
that the institution may, in exceptional circumstances
specified in regulations prescribed by the Secretary,
refuse to certify a statement that permits a student to
receive a loan under this part, or certify a loan
amount that is less than the student's determination of
need (as determined under part F of this title), if the
reason for such action is documented and provided in
written form to such student;
``(D) set forth a schedule for disbursement of the
proceeds of the loan in installments, consistent with
the requirements of section 428G (other than subsection
(b)(1) of such section); and
``(E) provide timely and accurate information--
``(i) concerning the status of student
borrowers (and students on whose behalf parents
borrow under this part) while such students are
in attendance at the institution and concerning
any new information of which the institution
becomes aware for such students (or their
parents) after they leave the institution, to
the Secretary for the servicing and collecting
of loans made under this part; and
``(ii) if the institution does not have an
agreement with the Secretary under subsection
(b), concerning student eligibility and need,
as determined under subparagraphs (A) and (B),
to the Secretary as needed for the alternative
origination of loans to eligible students and
parents in accordance with this part;
``(2) provide assurances that the institution will comply
with requirements established by the Secretary relating to
student loan information with respect to loans made under this
part;
``(3) provide that the institution accepts responsibility
and financial liability stemming from its failure to perform
its functions pursuant to the agreement;
``(4) provide that students at the institution and their
parents (with respect to such students) will not be eligible to
participate in the programs under part B of this title for the
period during which such institution participates in the direct
student loan program under this part;
``(5) provide for the implementation of a quality assurance
system, as established by the Secretary, to ensure that the
institution is complying with program requirements and meeting
program objectives;
``(6) provide that the institution will not charge any fees
of any kind, however described, to student or parent borrowers
for origination activities or the provision of any information
necessary for a student or parent to receive a loan under this
part, or any benefits associated with such loan; and
``(7) include such other provisions as the Secretary
determines are necessary to protect the interests of the United
States and to promote the purposes of this part.
``(b) Origination.--An agreement with any institution of higher
education for the origination of loans under this part shall--
``(1) supplement the agreement entered into in accordance
with subsection (a);
``(2) include provisions established by the Secretary that
are similar to the participation agreement provisions described
in paragraphs (1)(E)(ii), (2), (3), (4), (5), (6), and (7) of
subsection (a), as modified to relate to the origination of
loans by the institution;
``(3) provide that the institution will originate loans to
eligible students and parents in accordance with this part; and
``(4) provide that the note or evidence of obligation on
the loan shall be the property of the Secretary.
``(c) Withdrawal and Termination Procedures.--The Secretary shall
establish procedures by which institutions may withdraw or be
terminated from the program under this part.
``SEC. 455. TERMS AND CONDITIONS OF LOANS.
``(a) In General.--
``(1) Parallel terms, conditions, benefits, and amounts.--
Unless otherwise specified in this part, loans made to
borrowers under this part shall have the same terms,
conditions, and benefits, and be available in the same amounts,
as loans made to borrowers under sections 428, 428A, 428B, and
428H of this title.
``(2) Designation of loans.--Loans made to borrowers under
this part that, except as otherwise specified in this part,
have the same terms, conditions, and benefits as loans made to
borrowers under--
``(A) section 428 shall be known as `Federal Direct
Student Loans';
``(B) section 428A shall be known as `Federal
Direct Supplemental Loans for Students';
``(C) section 428B shall be known as `Federal
Direct PLUS Loans'; and
``(D) section 428H shall be known as `Federal
Direct Unsubsidized Student Loans'.
``(b) Interest Rates.--
``(1) Rates for fdsl and fdusl.--(A) For Federal Direct
Student Loans and Federal Direct Unsubsidized Student Loans
made before July 1, 1997, the applicable rate of interest
shall, during any 12-month period beginning on July 1 and
ending on June 30, be determined on the preceding June 1 and be
equal to--
``(i) the bond equivalent rate of 91-day Treasury
bills auctioned at the final auction held prior to such
June 1; plus
``(ii) 3.1 percent,
except that such rate shall not exceed 9 percent.
``(B) For Federal Direct Student Loans and Federal Direct
Unsubsidized Student Loans made on or after July 1, 1997, the
applicable rate of interest shall, during any 12-month period
beginning on July 1 and ending on June 30, be determined on the
preceding June 1 for all such loans and be equal to--
``(i) the bond equivalent rate of the security with
a comparable maturity as established by the Secretary;
plus
``(ii) 1 percent,
except that such rate shall not exceed 9 percent.
``(2) Rates for fdsls.--(A) For Federal Direct Supplemental
Loans for Students made before July 1, 1997, the applicable
rate of interest shall, during any 12-month period beginning on
July 1 and ending on June 30, be determined on the preceding
June 1 and be equal to--
``(i) the bond equivalent rate of 52-week Treasury
bills auctioned at the final auction held prior to such
June 1; plus
``(ii) 3.1 percent,
except that such rate shall not exceed 11 percent.
``(B) For Federal Direct Supplemental Loans for Students
made on or after July 1, 1997, the applicable rate of interest
shall, during any 12-month period beginning on July 1 and
ending on June 30, be determined on the preceding June 1 for
all such loans and be equal to--
``(i) the bond equivalent rate of the security with
a comparable maturity as established by the Secretary;
plus
``(ii) 1.5 percent,
except that such rate shall not exceed 11 percent.
``(3) Rates for fdplus.--(A) For Federal Direct PLUS loans
made before July 1, 1997, the applicable rate of interest
shall, during any 12-month period beginning on July 1 and
ending on June 30, be determined on the preceding June 1 for
loans and be equal to--
``(i) the bond equivalent rate of 52-week Treasury
bills auctioned at the final auction held prior to such
June 1; plus
``(ii) 3.1 percent,
except that such rate shall not exceed 10 percent.
``(B) For Federal Direct PLUS loans made on or after July
1, 1997, the applicable rate of interest shall, during any 12-
month period beginning on July 1 and ending on June 30, be
determined on the preceding June 1 for all such loans and be
equal to--
``(i) the bond equivalent rate of the security with
a comparable maturity as established by the Secretary;
plus
``(ii) 2.1 percent,
except that such rate shall not exceed 10 percent.
``(4) Publication.--The Secretary shall determine the
applicable rates of interest under this subsection after
consultation with the Secretary of Treasury and shall publish
such rate in the Federal Register as soon as practicable after
the date of determination.
``(c) Loan Fee.--For academic years 1994-1995, 1995-1996, and 1996-
1997, the Secretary shall charge the borrower of a loan made under this
part a loan fee of 5 percent of the principal amount of the loan. For
academic years 1997-1998 and succeeding academic years, the Secretary
shall charge the borrower of a loan made under this part a loan fee of
3.65 percent of the principal amount of the loan.
``(d) Repayment Plans.--
``(1) Design and selection.--Consistent with criteria
established by the Secretary, the Secretary shall offer to a
borrower of a loan made under this part a variety of plans for
repayment of such loan, including principal and interest on the
loan. The borrower shall be entitled to accelerate, without
penalty, repayment on his or her loans. The borrower may
choose--
``(A) a standard repayment plan, with a fixed
annual repayment amount paid over a fixed period of
time, consistent with subsection (a)(1) of this
section;
``(B) an extended repayment plan, with a fixed
annual repayment amount paid over an extended period of
time, provided that the borrower annually repays a
minimum amount determined by the Secretary, consistent
with the requirements of section 428(b)(1)(L);
``(C) a graduated repayment plan, with annual
repayment amounts established at two or more graduated
levels and paid over a fixed or extended period of
time, provided that any of the borrower's scheduled
payments shall not be less than 50 percent, nor more
than 150 percent, of what the amortized payment on the
amount owed would be if the loan were repaid under the
standard repayment plan; and
``(D) except for the borrower of a Federal Direct
PLUS Loan, an income contingent repayment plan known as
the `EXCEL Account,' with varying annual repayment
amounts based on the income of the borrower, paid over
an extended period of time, not to exceed a maximum
length of time determined by the Secretary.
``(2) Selection by secretary.--If a borrower of a loan made
under this part does not select a repayment plan described in
paragraph (1), the Secretary may provide the borrower with a
repayment plan described in subparagraph (A), (B), or (C) of
paragraph (1).
``(3) Changes in selections.--The borrower of a loan made
under this part may change his or her selection of a repayment
plan under paragraph (1), or the Secretary's selection of a
plan for the borrower under paragraph (2), as the case may be,
under such terms and conditions as may be established by the
Secretary.
``(4) Alternative repayment plans.--The Secretary may
provide, on a case-by-case basis, an alternative repayment plan
to a borrower of a loan under this part who demonstrates to the
satisfaction of the Secretary that the terms and conditions of
the repayment plans available under paragraph (1) are not
adequate to accommodate the borrower's exceptional
circumstances. In designing such alternative repayment plans,
the Secretary shall ensure that such plans do not exceed the
cost to the Federal Government, as determined on the basis of
the present value of future payments by such borrowers, of
loans made using the plans available under paragraph (1).
``(5) Repayment after default.--The Secretary may require
any borrower who has defaulted on a loan made under this part
to--
``(A) pay all reasonable collection costs
associated with such loan; and
``(B) repay the loan pursuant to an EXCEL Account
in accordance with subsection (e).
``(e) Repayment Through EXCEL Accounts.--
``(1) Information and procedures.--The Secretary may obtain
such information as is reasonably necessary regarding the
income of a borrower (and the borrower's spouse, if applicable)
of a loan made under this part that is, or may be, repaid
pursuant to an EXCEL Account for the purpose of determining the
annual repayment obligation of the borrower. Return and return
information (as defined in section 6103 of the Internal Revenue
Code of 1986) may be obtained under the preceding sentence only
to the extent authorized by section 6103(l)(13) of such Code.
The Secretary shall establish procedures for determining the
borrower's repayment obligation on that loan for such year, and
such other procedures as are necessary to implement effectively
repayment pursuant to an EXCEL Account.
``(2) Repayment based on adjusted gross income.--A
repayment schedule for a loan made under this part and repaid
pursuant to an EXCEL Account shall be based on adjusted gross
income (as defined in section 62 of the Internal Revenue Code
of 1986, 26 U.S.C. 62) of the borrower or, if the borrower is
married and files a Federal income tax return jointly with his
or her spouse, on adjusted gross income of the borrower and his
or her spouse.
``(3) Additional documents.--A borrower who chooses, or is
required, to repay a loan made under this part pursuant to an
EXCEL Account, and for whom adjusted gross income is
unavailable or does not reasonably reflect his or her current
income, shall provide to the Secretary other documentation of
income satisfactory to the Secretary, which documentation the
Secretary may use to determine an appropriate repayment
schedule.
``(4) Repayment schedules.--EXCEL Account repayment
schedules shall be established by the Secretary through
regulations and shall require payments measured as a percentage
of the appropriate portion of the annual income of the borrower
(and the borrower's spouse, if applicable) as determined by the
Secretary.
``(5) Calculation of balance due.--The balance due on a
loan made under this part that is repaid pursuant to an EXCEL
Account shall equal the unpaid principal amount of the loan,
any accrued interest, and any fees, such as late charges,
assessed on such loan. The Secretary may limit by regulation
the amount of interest that may be capitalized on such loan,
and the timing of any such capitalization.
``(6) Notification to borrowers.--The Secretary shall
establish procedures under which a borrower of a loan made
under this part who chooses or is required to repay such loan
pursuant to an EXCEL Account is notified of the terms and
conditions of such plan, including notification of such
borrower--
``(A) that the Internal Revenue Service will
disclose to the Secretary tax return information as
authorized under section 6103(l)(13) of the Internal
Revenue Code of 1986; and
``(B) that if a borrower considers that special
circumstances, such as a loss of employment by the
borrower or his or her spouse, warrant an adjustment in
the borrower's loan repayment as determined using the
information described in subparagraph (A), or the
alternative documentation described in paragraph (3),
the borrower may contact the Secretary, who shall
determine whether such adjustment is appropriate, in
accordance with criteria established by the Secretary.
``(f) Deferment.--
``(1) Effect on principal and interest.--A borrower of a
loan made under this part who meets the requirements described
in paragraph (2) shall be eligible for a deferment, during
which periodic installments of principal need not be paid, and
interest--
``(A) shall not accrue, in the case of a Federal
Direct Student Loan or a Federal Direct Consolidation
Loan that consolidated only Federal Direct Student
Loans, or a combination of such loans and Federal
Student Loans for which the student borrower received
an interest subsidy under section 428; or
``(B) shall accrue and be capitalized or paid by
the borrower, in the case of a Federal Direct
Supplemental Loan for Students loan, a Federal Direct
PLUS Loan, a Federal Direct Unsubsidized Student Loan,
or a Federal Direct Consolidation Loan other than those
described in subparagraph (A).
``(2) Eligibility.--A borrower of a loan made under this
part shall be eligible for a deferment during any period--
``(A) during which the borrower--
``(i) is pursuing at least a half-time
course of study at an eligible institution, as
determined by such institution; or
``(ii) is pursuing a course of study
pursuant to a graduate fellowship program
approved by the Secretary, or pursuant to a
rehabilitation training program for individuals
with disabilities approved by the Secretary,
except that no borrower shall be eligible for a
deferment under this subparagraph, or a loan made under
this part (other than a Federal Direct PLUS Loan, or a
Federal Direct Consolidation Loan), while serving in a
medical internship or residency program;
``(B) not in excess of 3 years during which the
borrower is seeking and unable to find full-time
employment; or
``(C) not in excess of 3 years during which the
Secretary determines, in accordance with regulations
prescribed under section 435(o), that the borrower has
experienced or will experience an economic hardship,
regardless of the reason for such hardship.
``(g) Federal Direct Consolidation Loans.--A borrower of a loan
made under this part may consolidate such loan with the loans described
in subsections (a)(4) and (d)(1)(C) of section 428C only under the
terms and conditions established by the Secretary under this part.
Loans made under this subsection shall be known as `Federal Direct
Consolidation Loans'.
``(h) Borrower Defenses.--Notwithstanding any other provision of
State or Federal law, the Secretary shall specify in regulations
(except as authorized under section 458(a)) which acts or omissions of
an institution of higher education a borrower may assert as a defense
to repayment of a loan made under this part, except that in no event
may a borrower recover from the Secretary, in any action arising from
or relating to a loan made under this part, an amount in excess of the
amount such borrower has repaid on such loan.
``(i) Optically Imaged Documents.--Records maintained in accordance
with section 484A(c) may be used in any proceeding, as permitted by
section 484A(c), with respect to a loan made under this part.
``(j) Nondischargeability in Bankruptcy.--Notwithstanding any other
provision of law, a loan made under this part shall not be
dischargeable in bankruptcy.
``SEC. 456. CONTRACTS.
``(a) Contracts for Supplies and Services.--
``(1) In general.--The Secretary may award one or more
contracts for services and supplies under subsection (b). The
entities with which the Secretary may enter into such contracts
may include, but are not limited to, agencies with agreements
with the Secretary under sections 428(b) and (c), if such
agencies are otherwise qualified and comply with the procedures
applicable to the award of such contracts.
``(2) Exemption.--(A) The Secretary may, through June 30,
1998, award contracts under this section without regard to the
requirements in section 303 of the Federal Property and
Administrative Services Act of 1949 (41 U.S.C. 253), section 18
of the Office of Federal Procurement Policy Act (41 U.S.C.
416), and section 8(e) of the Small Business Act (15 U.S.C.
637(e)) and the corresponding requirements of the Federal
Acquisition Regulations if the Secretary--
``(i) determines in writing, on a case-by-case
basis, that the Government's need for the services and
supplies to be provided under the contract is of such
an unusual and compelling urgency that sources from
which the Secretary solicits bids or proposals must be
limited; and
``(ii) notifies the Congress in writing of that
determination not more than 30 days after the award of
the contract.
``(B) The Secretary may make the determination described in
subparagraph (A)(i) if the Secretary determines that exemption
from the requirements described in subparagraph (A) is in the
public interest and necessary for the orderly transition from
the loan programs under part B to the direct student loan
programs under this part.
``(C) On and after July 1, 1998, all statutory and
regulatory requirements described in subparagraph (A) shall
apply to the award of a contract under this section.
``(b) Contracts for Origination, Servicing, and Data Systems.--The
Secretary may enter into one or more contracts for--
``(1) the alternative origination of loans to students
attending institutions with agreements to participate in the
program under this part (or their parents), if such
institutions do not have agreements with the Secretary under
section 454(b);
``(2) the servicing and collection of loans made under this
part;
``(3) the establishment and operation of one or more data
systems for the maintenance of records on all loans made under
this part;
``(4) services to assist in the orderly transition from the
loan programs under part B to the direct student loan programs
under this part; and
``(5) such other aspects of the direct student loan
programs as the Secretary determines are necessary to ensure
the successful operation of the programs.
``SEC. 457. REPORTS.
``(a) Annual Reports.--The Secretary shall submit to the Congress
not later than July 1, 1993, and each July 1 for the 5 succeeding years
an annual report describing the progress and status of the loan program
under this part.
``(b) Research, Demonstration, and Evaluation.--The Secretary may
use a portion of the funds described in section 459 for research on, or
the demonstration or evaluation of, any aspects of the program
authorized by this part, including flexible repayment plans.
``SEC. 458. REGULATORY ACTIVITIES.
``(a) Notice in Lieu of Regulations for First Year of Program.--The
Secretary shall publish in the Federal Register whatever standards,
criteria, and procedures, consistent with the provisions of this part,
the Secretary determines are reasonable and necessary to the successful
implementation of the first year of the direct student loan program
authorized by this part. Section 431 of the General Education
Provisions Act shall not apply to the publication of such standards,
criteria, and procedures.
``(b) Closing Date for Applications From Institutions.--The
Secretary shall establish a date not later than October 1, 1993, as the
closing date for receiving applications from institutions of higher
education desiring to participate in the first year of the direct loan
program under this part.
``(c) Publication of List of Participating Institutions and Control
Group.--Not later than January 1, 1994, the Secretary shall publish in
the Federal Register a list of the institutions of higher education
selected to participate in the first year of the direct loan program
under this part.
``SEC. 459. FUNDS FOR ADMINISTRATIVE EXPENSES.
``Each fiscal year, there shall be available to the Secretary of
Education from funds not otherwise appropriated, funds to be obligated
for administrative costs under this part, including the costs of the
transition from the loan programs under part B to the direct student
loan programs under this part and transition support for the expenses
of guaranty agencies in servicing outstanding loans in their portfolios
and in guaranteeing new loans, not to exceed $261,000,000 in fiscal
year 1994, $346,000,000 in fiscal year 1995, $552,000,000 in fiscal
year 1996, $596,000,000 in fiscal year 1997, and $749,000,000 in fiscal
year 1998. If in any fiscal year, the Secretary determines that
additional funds for administrative expenses are needed as a result of
such transition, or the expansion of the direct student loan programs
under this part, the Secretary is authorized to use funds available
under this section for a subsequent fiscal year for such expenses,
except that the total expenditures by the Secretary shall not exceed
$2,504,000,000 in fiscal years 1994 through 1998. The Secretary is also
authorized to carry over funds available under this section to a
subsequent fiscal year.''.
CHAPTER 2--CONFORMING AMENDMENTS
SEC. 4021. PRESERVING LOAN ACCESS.
(a) Purpose.--It is the purpose of the amendments made by this
section to provide the Secretary with flexible authority as needed to
preserve access to student and parent loans under part B of title IV of
the Act during the transition from the Federal Family Education Loan
Program under such part to the Federal Direct Student Loan Program
under part D of such title.
(b) Advances to Guaranty Agencies for Lender-of-Last Resort
Services.--
(1) Amendment.--Section 428(j) of the Act is amended by
adding at the end thereof the following new paragraph:
``(4) Advances to guaranty agencies for lender-of-last
resort services during transition to direct lending.--(A) In
order to ensure the availability of loan capital during the
transition from the Federal Family Education Loan program under
this part to the Federal Direct Student Loan program under part
D of this title, the Secretary is authorized to provide a
guaranty agency with additional advance funds in accordance
with section 422(c)(7), with such restrictions on the use of
such funds as are determined appropriate by the Secretary, in
order to ensure that the guaranty agency will make loans as the
lender-of-last-resort. Such agency shall make such loans in
accordance with this subsection and the requirements of the
Secretary.
``(B) Notwithstanding any other provision of this part, a
guaranty agency serving as a lender-of-last-resort under this
paragraph shall be paid a fee, established by the Secretary,
for making such loans in lieu of interest and special allowance
subsidies, and shall be required to assign such loans to the
Secretary on demand. Upon such assignment, the portion of the
advance represented by the loans assigned shall be considered
repaid by such guaranty agency.''.
(2) Conforming amendment.--Section 422(c)(7) of the Act is
amended by striking ``to a guaranty agency'' through the end
thereof and inserting the following: ``to a guaranty agency--
``(A) in accordance with section 428(j), in order
to ensure that the guaranty agency shall make loans as
the lender-of-last-resort during the transition from
the Federal Family Education Loan Program under this
part to the Federal Direct Student Loan Program under
part D of this title; or
``(B) if the Secretary is seeking to terminate the
guaranty agency's agreement, or assuming the guaranty
agency's functions, in accordance with section
428(c)(10)(F)(v), in order to assist the agency in
meeting its immediate cash needs, ensure the
uninterrupted payment of claims, or ensure that the
guaranty agency shall make loans as described in
subparagraph (A);''.
(c) Lender Referral Services.--Section 428(e) of the Act is
amended--
(1) in paragraph (1)--
(A) by amending the paragraph heading to read as
follows: ``In general; agreements with guaranty
agencies.--'';
(B) by inserting the subparagraph designation
``(A)'' immediately after the paragraph heading;
(C) by striking ``in any State'' and inserting
``with which the Secretary has an agreement under
subparagraph (B)''; and
(D) by adding at the end thereof the following new
subparagraph:
``(B)(i) The Secretary may enter into agreements with
guaranty agencies that meet standards established by the
Secretary to provide lender referral services in geographic
areas specified by the Secretary. Such guaranty agencies shall
be paid in accordance with paragraph (3) for such services.
``(ii) The Secretary shall publish in the Federal Register
whatever standards, criteria, and procedures consistent with
the provisions of this part and part D of this title, the
Secretary determines are reasonable and necessary to provide
lender referral services under this subsection and ensure loan
access to student and parent borrowers during the transition
from the loan programs under this part to the direct student
loan programs under part D of this title. Section 431 of the
General Education Provisions Act shall not apply to the
publication of such standards, criteria, and procedures.'';
(2) in paragraph (2)--
(A) in the matter preceding subparagraph (A), by
striking ``in a State'' and inserting ``with which the
Secretary has an agreement under paragraph (1)(B)'';
(B) by amending subparagraph (A) to read as
follows:
``(A) such student is either a resident of, or is
accepted for enrollment in, or is attending, an
eligible institution located in a geographic area for
which the Secretary (I) determines that loans are not
available to all eligible students, and (II) has
entered into an agreement with a guaranty agency under
paragraph (1)(B) to provide lender referral services;
and'';
(4) in paragraph (3), by striking ``The'' and inserting
``From funds available for costs of transition under section
459 of the Act, the''; and
(5) by striking paragraph (5).
(d) Student Loan Marketing Association.--Section 439(q) of the Act
is amended--
(1) in paragraph (1)(A)--
(A) in the first sentence, by striking ``the
Association or its designated agency may begin making
loans'' and inserting ``the Association or its
designated agent shall, subject to the limitations in
section 428(j)(3), begin making loans to such eligible
borrowers''; and
(B) by striking the second sentence;
(2) in paragraph (2)(A), by striking ``the Association or
its designated agent may'' and inserting ``the Association or
its designated agent shall, subject to the limitations in
section 428(j)(3),''; and
(3) in paragraph (3), by striking ``that--'' through the
end thereof and inserting the following: ``that the conditions
that caused the implementation of this subsection have ceased
to exist.''.
SEC. 4022. GUARANTY AGENCY RESERVES.
Section 422 of the Act is amended by adding at the end thereof the
following new subsection:
``(g) Preservation of Guaranty Agency Reserves.--
``(1) Authority to recover funds.--Notwithstanding any
other provision of law, the reserve funds of the guaranty
agencies, and any assets purchased with such reserve funds,
regardless of who holds or controls the reserves or assets,
shall be considered to be the property of the United States to
be used in the operation of the program authorized by this part
or the program authorized by part D of this title. However, the
Secretary may not require the return of all of a guaranty
agency reserve funds to the Secretary unless he or she
determines that such return is essential to the operation of
the program authorized by this part or the program authorized
by part D of this title, or to ensure the orderly termination
of the guaranty agency's operations and the liquidation of its
assets. The reserves shall be maintained by each guaranty
agency to pay program expenses and contingent liabilities, as
authorized by the Secretary, except that the Secretary may--
``(A) direct a guaranty agency to return to the
Secretary a portion of its reserve fund which the
Secretary determines is unnecessary to pay the program
expenses and contingent liabilities of the guaranty
agency; and
``(B) direct the guaranty agency to require the
return, to the guaranty agency or to the Secretary, of
any reserve funds or assets held by, or under the
control of, any other entity, which the Secretary
determines are necessary to pay the program expenses
and contingent liabilities of the guaranty agency, or
which are required for the orderly termination of the
guaranty agency's operations and the liquidation of its
assets.
``(2) Termination provisions in contracts.--To ensure that
the funds and assets of the guaranty agency are preserved, any
contract with respect to the administration of a guaranty
agency's reserve funds, or the administration of any assets
purchased or acquired with the reserve funds of the guaranty
agency, that is entered into or extended by the guaranty
agency, or any other party on behalf of or with the concurrence
of the guaranty agency, after the effective date of this
provision shall provide that the contract is terminable by the
Secretary upon 30 days notice to the contracting parties if the
Secretary determines that such contract includes an
impermissible transfer of the reserve funds or assets, or is
otherwise inconsistent with the terms or purposes of this
section.''.
SEC. 4023. TERMS OF LOANS.
Section 428 of the Act is amended--
(1) in subsection (b)(1)(D), by striking ``be subject to''
through the end thereof and inserting the following: ``be
subject to income contingent repayment in accordance with
subsection (m);''; and
(2) in subsection (m)--
(A) by amending paragraph (1) to read as follows:
``(1) Authority of secretary to require.--The Secretary may
require any borrower who has defaulted on a loan made under
this part that is assigned to the Secretary under subsection
(c)(8) to repay that loan under an income contingent repayment
plan, the terms and conditions of which shall be established by
the Secretary and the same as, or similar to, the EXCEL Account
established for purposes of part D of this title.''; and
(B) by striking paragraphs (2) through (4) and
inserting the following:
``(2) Loans for which income contingent repayment may be
required.--A loan made under this part may be required to be
repaid under this subsection if the note or other evidence of
the loan has been assigned to the Secretary pursuant to
subsection (c)(8).''.
SEC. 4024. ASSIGNMENT OF LOANS.
Section 428(c)(8) of the Act is amended by--
(1) inserting the subparagraph designation ``(A)'' after
the paragraph heading;
(2) striking the second and third sentences; and
(3) adding at the end thereof the following new
subparagraph:
``(B) An orderly transition from the Federal Family
Education Loan program under this part to the Federal Direct
Student Loan program under part D of this title shall be deemed
to be in the Federal fiscal interest, and a guaranty agency
shall promptly assign loans to the Secretary under this
paragraph upon his or her request.''.
SEC. 4025. TERMINATION OF GUARANTY AGENCY AGREEMENTS; ASSUMPTION OF
GUARANTY AGENCY FUNCTIONS BY THE SECRETARY.
Section 428(c)(10) of the Act is amended--
(1) in subparagraph (C), by inserting a comma and ``as
appropriate,'' immediately after ``the Secretary shall'';
(2) in subparagraph (D)--
(A) by inserting the clause designation ``(i)''
after ``(D)'';
(B) by striking ``Each'' and inserting ``If the
Secretary is not seeking to terminate the guaranty
agency's agreement under subparagraph (E), or assuming
the guaranty agency's functions under subparagraph (F),
a'';
(C) by adding at the end thereof the following new
clause:
``(ii) If the Secretary is seeking to terminate the
guaranty agency's agreement under subparagraph (E), or assuming
the guaranty agency's functions under subparagraph (F), a
management plan described in subparagraph (C) shall include the
means by which the Secretary and the guaranty agency shall work
together to ensure the orderly termination of the operations,
and liquidation of the assets of, the guaranty agency.'';
(3) in subparagraph (E)--
(A) in clause (ii), by striking ``or'' at the end
thereof;
(B) in clause (iii), by striking the period at the
end thereof and inserting a semicolon; and
(C) by adding at the end thereof the following new
clauses:
``(iv) the Secretary determines that such action is
necessary to protect the Federal fiscal interest;
``(v) the Secretary determines that such action is
necessary to ensure the continued availability of loans
to student or parent borrowers; or
``(vi) the Secretary determines that such action is
necessary to ensure an orderly transition from the loan
programs under this part to the direct student loan
programs under part D of this title.'';
(4) in subparagraph (F)--
(A) in the matter preceding clause (i), by striking
``Except as provided in subparagraph (G), if'' and
inserting ``If'';
(B) by amending clause (v) to read as follows:
``(v) provide the guaranty agency with additional
advance funds in accordance with section 422(c)(7),
with such restrictions on the use of such funds as is
determined appropriate by the Secretary, in order to--
``(I) meet the immediate cash needs of the
guaranty agency;
``(II) ensure the uninterrupted payment of
claims; or
``(III) ensure that the guaranty agency
will make loans as the lender-of-last- resort,
in accordance with subsection (j)(4);'';
(C) in clause (vi)--
(i) by striking ``and to avoid'' and
inserting ``to avoid'';
(ii) by striking the period at the end
thereof and inserting ``, and to ensure an
orderly transition from the loan programs under
this part to the direct student loan programs
under part D of this title.''; and
(iii) by redesignating such clause as
clause (vii); and
(D) by inserting after clause (v) the following new
clause:
``(vi) use all funds and assets of the guaranty
agency to assist in the activities undertaken in
accordance with this subparagraph and take appropriate
action to require the return, to the guaranty agency or
the Secretary, of any funds or assets provided by the
guaranty agency, under contract or otherwise, to any
person or organization; or'';
(5) by striking subparagraph (G);
(6) by redesignating subparagraphs (H), (I), and (J) as
subparagraphs (I), (J), and (K), respectively;
(7) by inserting after subparagraph (F) the following new
subparagraphs:
``(G) Notwithstanding any other provision of Federal or
State law, if the Secretary has terminated or is seeking to
terminate a guaranty agency's agreement under subparagraph (E),
or has assumed a guaranty agency's functions under subparagraph
(F)--
``(i) such guaranty agency may not file for
bankruptcy;
``(ii) no State court may issue any order affecting
the Secretary's actions with respect to such guaranty
agency;
``(iii) any contract with respect to the
administration of a guaranty agency's reserve funds, or
the administration of any assets purchased or acquired
with the reserve funds of the guaranty agency, that is
entered into or extended by the guaranty agency, or any
other party on behalf of or with the concurrence of the
guaranty agency, after the effective date of this
provision shall provide that the contract is terminable
by the Secretary upon 30 days notice to the contracting
parties if the Secretary determines that such contract
includes an impermissible transfer of the reserve funds
or assets, or is otherwise inconsistent with the terms
or purposes of this section; and
``(iv) no provision of State law shall apply to the
actions of the Secretary in terminating the operations
of a guaranty agency.
``(H) Notwithstanding any other provision of law, the
Secretary's liability for any outstanding liabilities of a
guaranty agency (other than outstanding student loan guarantees
under this part), the functions of which the Secretary has
assumed, shall not exceed the fair market value of the reserves
of the guaranty agency, minus any necessary liquidation or
other administrative costs.''; and
(8) in subparagraph (K) (as redesignated by paragraph (6)),
by striking ``system, together'' through the end thereof and
inserting the following: ``system and the progress of the
transition from the loan programs under this part to the direct
student loan programs under part D of this title.''.
SEC. 4026. ADMINISTRATIVE COST ALLOWANCE.
Section 428(f)(1) of the Act is amended--
(1) in subparagraph (A), by striking ``The Secretary'' and
inserting ``For a fiscal year prior to fiscal year 1994, the
Secretary''; and
(2) in subparagraph (B), by inserting ``prior to fiscal
year 1994'' after ``any fiscal year''.
SEC. 4027. CONSOLIDATION LOANS.
Section 428C of the Act is amended--
(1) by amending subsection (a)(3)(A) to read as follows:
``(3) Definition of eligible borrowers.--(A) For the
purpose of this section, the term `eligible borrower' means a
borrower who, at the time of application for a consolidation
loan is in repayment status, or in a grace period preceding
repayment, or is a delinquent or defaulted borrower who will
reenter repayment through loan consolidation.'';
(2) in subsection (b)--
(A) in paragraph (1)--
(i) in subparagraph (A)(ii), by inserting
``with income-sensitive repayment terms'' after
``obtain a consolidation loan'';
(ii) by redesignating subparagraph (E) as
subparagraph (F); and
(iii) by inserting after subparagraph (D)
the following new subparagraph:
``(E) that the lender shall offer an income-
sensitive repayment schedule, established by the lender
in accordance with the regulations of the Secretary, to
the borrower of any consolidation loan made by the
lender on or after July 1, 1994; and'';
(B) in paragraph (4), by amending subparagraph (C)
to read as follows:
``(C)(i) provides that periodic installments of
principal need not be paid, but interest shall accrue
and be paid in accordance with clause (ii), during any
period for which the borrower would be eligible for a
deferral under section 428(b)(1)(M), and that any such
period shall not be included in determining the
repayment period pursuant to subsection (c)(2) of this
section; and
``(ii) provides that interest shall accrue and be
paid--
``(I) by the Secretary, in the case of a
consolidation loan that consolidated only
Federal Stafford Loans for which the student
borrower received an interest subsidy under
section 428; or
``(II) by the borrower, or capitalized, in
the case of a consolidation loan other than one
described in subclause (I);''; and
(C) by adding at the end thereof the following new
paragraph:
``(5) Direct loans.--In the event that a borrower is unable
to obtain a consolidation loan with income-sensitive repayment
terms acceptable to the borrower from a lender with an
agreement under subsection (a)(1), the Secretary shall offer
any such borrower who applies for it, a direct consolidation
loan to be repaid pursuant to an EXCEL Account under part D of
this title, except that the Secretary shall not offer such
loans if, in his or her judgment, the Department does not yet
have the necessary origination and servicing arrangements in
place for such loans.''; and
(3) in subsection (c)--
(A) in paragraph (1), by amending subparagraphs (B)
and (C) to read as follows:
``(B) A consolidation loan made before July 1, 1994, shall
bear interest at an annual rate on the unpaid principal balance
of the loan that is equal to the greater of--
``(i) the weighted average of the interest rates on
the loans consolidated, rounded to the nearest whole
percent; or
``(ii) 9 percent.
``(C) A consolidation loan made on or after July 1, 1994,
shall bear interest at an annual rate on the unpaid principal
balance of the loan that is equal to the weighted average of
the interest rates on the loans consolidated, rounded upward to
the nearest whole percent.'';
(B) in paragraph (2)(A)--
(i) in the matter preceding clause (i), by
striking out ``income sensitive repayment
schedules. Such repayment terms'' and inserting
in lieu thereof ``income sensitive repayment
schedules, established by the lender in
accordance with the regulations of the
Secretary. Except as required by such income
sensitive repayment schedules, or by the terms
of repayment pursuant to an EXCEL Account
offered by the Secretary under subsection
(b)(5), such repayment terms'';
(ii) by redesignating clauses (i), (ii),
(iii), (iv), and (v) as clauses (ii), (iii),
(iv), (v), and (vi), respectively;
(iii) by inserting immediately preceding
clause (ii) (as redesignated by clause (ii))
the following new clause:
``(i) is less than $7,500, then such consolidation
loan shall be repaid in not more than 10 years;''; and
(iv) by adding a period at the end of
clause (vi) (as redesignated by clause (ii));
(C) by striking out suparagraph (B) of paragraph
(2); and
(D) by redesignating subparagraph (C) of paragraph
(2) as subparagraph (B); and
(E) in paragraph (3)(A), by inserting after the
subparagraph designation the following: ``except as
required by the terms of repayment pursuant to an EXCEL
Account offered by the Secretary under subsection
(b)(5),''.
SEC. 4028. STUDENT LOAN MARKETING ASSOCIATION.
Section 439 of the Act is further amended by adding at the end
thereof the following new subsection:
``(s) Transition Study.--The Secretaries of Education and the
Treasury shall prepare a study, to be completed within 6 months of the
enactment of this provision, which shall examine alternatives
concerning the status, operations, and purposes of the Association
during and after the transition from the Federal Family Education Loan
program to the Federal Direct Student Loan program. Such study shall--
``(1) consider how best to meet the needs of students and
taxpayers;
``(2) reflect the need for the Association to maintain
liquidity and perform other functions for the Federal Family
Education Loan program during the transition from such program
to the Federal Direct Student Loan program under part D of this
title, including additional duties as specified by the
Secretary of Education or the Secretary of the Treasury;
``(3) consider any appropriate change to part D of title
VII, relating to the College Construction Loan Insurance
Association; and
``(4) be considered by the Secretaries of Education and the
Treasury in developing any legislative proposals concerning any
changes to the status of the Association as a Government-
sponsored enterprise or its duties under the Federal Family
Education Loan program.''.
SEC. 4029. AUTHORITY TO USE OPTICALLY IMAGED DOCUMENTS.
(a) General Authority.--Section 484A of the Act is amended--
(1) in the heading, by adding a semicolon and ``optically
imaged documents'' after ``limitations''; and
(2) by adding at the end thereof the following new
subsection:
``(c) In General.--(1) It is the purpose of this subsection to--
``(A) allow the Secretary to use optical imaging technology
to store and retrieve documents and records, including
promissory notes and repayment agreements, required for the
administration of the programs authorized under part D of this
title, or for the administration of loans made under part B of
this title that have been assigned to the Secretary;
``(B) permit the Secretary to destroy originals of such
documents and records, including promissory notes and repayment
agreements, after they have been optically imaged, thereby
achieving significant savings in storage and retrieval costs;
and
``(C) ensure that the Secretary may introduce as evidence
in any proceeding with respect to the programs or loans
described in subparagraph (A) optically imaged documents and
records, including promissory notes and repayment agreements.
``(2) Notwithstanding any other provision of Federal or State law,
an optically imaged copy of any document or record, including a
promissory note or repayment agreement, may be introduced as evidence
in any proceeding with respect to the programs or loans described in
paragraph (1)(A) in any Federal or State court, or other tribunal, and
such optically imaged copy shall be admissible in any court or tribunal
of the United States or any State as if it were the original document
or record and have the same force and effect as the original.
``(3) Nothing in this subsection shall be interpreted to preclude
the admissibility of a duplicate of a document or record required for
the administration of the programs or loans described in paragraph
(1)(A) made by a technology other than optical imaging consistent with
the Federal Rules of Evidence and section 1732 of title 28 of the
United States Code, or applicable State law.
``(4) Nothing in this subsection shall be interpreted to preclude
the admissibility of an optically imaged copy of any document or record
in a proceeding outside the scope of this subsection consistent with
the Federal Rules of Evidence and section 1732 of title 28 of the
United States Code, or applicable State law.''.
(b) Part B Authority.--Section 432 of the Act is amended by adding
at the end thereof the following new subsection:
``(q) Optically Imaged Documents.--Records maintained in accordance
with section 484A(c) may be used in any proceeding, as permitted by
section 484A(c), with respect to a loan that was made under this part
and has been assigned to the Secretary.''.
(c) Conforming Amendment.--Section 487 of the Act is amended by
adding at the end thereof the following new subsection:
``(f) Use of Optically Imaged Documents.--In any proceeding with
respect to a program or activity under part D of this title, or with
respect to a loan made under part B of this title that has been
assigned to the Secretary, records maintained in accordance with
section 484A may be used as provided in that section.''.
SEC. 4030. AMENDMENT TO THE BALANCED BUDGET AND EMERGENCY DEFICIT
CONTROL ACT OF 1985.
The Balanced Budget and Emergency Deficit Control Act of 1985 is
amended--
(1) in section 252(c)(1)(B), by striking ``guaranteed'';
(2) in section 256(b)--
(A) by striking the subsection designation and
heading and inserting the following:
``(b) Effect of Orders on Student Loan Programs.--
``(1) Federal family education loan program.--(A)'';
(B) by redesignating paragraphs (2) and (3) as
subparagraphs (B) and (C), respectively, and by
indenting such subparagraphs by an additional 2 ems
spaces;
(C) in paragraph (1)(A) (as redesignated in
subparagraph (B)), by striking ``described in
paragraphs (2) and (3)'' and inserting ``described in
subparagraphs (B) and (C)'';
(D) in paragraph (1)(B) (as redesignated in
subparagraph (C)), by redesignating subparagraphs (A)
and (B) as clauses (i) and (ii), respectively; and
(E) by adding at the end thereof the following new
paragraph:
``(2) Federal direct student loan program.--(A) Any
reductions that are required to be achieved from the Federal
Direct Student Loan program operated under part D of title IV
of the Higher Education Act of 1965 as a consequence of an
order issued pursuant to section 254, shall be achieved only by
the application of the measures described in subparagraph (B).
``(B) For any loan made during the period beginning on the
date that an order issued under section 254 takes effect with
respect to a fiscal year, and ending at the close of such
fiscal year, the loan fee that is authorized to be collected
pursuant to section 456(c) of such Act shall be increased by
0.50 percent.''.
CHAPTER 3--EFFECTIVE DATES; STUDY
SEC. 4031. EFFECTIVE DATES.
(a) In General.--Except as otherwise provided in this section, the
amendments made by this subtitle shall be effective upon enactment.
(b) Income Contingent Repayment.--The amendments made by section
4023 of this Act shall be effective for loans made in accordance with
section 428 for periods of instruction beginning on or after July 1,
1993, or made on or after July 1, 1993, in the case of loans made in
accordance with section 428A, 428B, or 428C of the Act.
(c) Administrative Cost Allowance.--The amendments made by section
4026 of this Act shall be effective on October 1, 1994.
(d) Consolidation Loans.--The amendments made by section 4027 of
this Act (other than the amendment made by section 4027(2)(B)) shall be
effective for loans made in accordance with section 428C of the Act or
after July 1, 1994.
SEC. 4032. STUDY OF INTERNAL REVENUE SERVICE COLLECTION OF STUDENT
LOANS.
(a) General Rule.--The Secretary of Education, in consultation with
the Secretary of the Treasury, shall conduct a study of the feasibility
of implementing a system for the repayment of Federal student loans
through wage withholding or other means involving the Internal Revenue
Service. Such study shall include an examination of--
(1) whether the Internal Revenue Service could implement
such a system within its current resources and without
adversely affecting the ability of the Internal Revenue Service
to collect tax revenues,
(2) the cumulative impact on voluntary compliance with the
tax system of increased disclosure of tax return information
and increased Internal Revenue Service involvement in nontax
collection activities,
(3) the anticipated effect on the management of Federal
student loan collections and on borrower repayment of such
loans, and
(4) the ability of the Internal Revenue Service to
effectively service student loans.
(b) Recommendations.--Not later than the date 6 months after the
date of the enactment of this Act, the Secretary of Education shall
submit to the Congress a report on the study conducted under subsection
(a), together with such legislative recommendations as such Secretary
may deem advisable.
SEC. 4033. PREFERENCE OF COMMITTEE FOR IRS COLLECTION MECHANISM.
It is the sense of the Committee on Education and Labor that--
(1) the Committee may not, consistent with its jurisdiction
under the Rules of the House of Representatives, amend this Act
to include provisions providing for the collection of student
loans pursuant to the Internal Revenue Code of 1986 using the
Internal Revenue Service of the Department of the Treasury;
(2) the Committee would support the amendment of this Act
to include such provisions, as well as amendments to the Higher
Education Act of 1965, in the manner proposed by H.R. ________
as introduced on May 11, 1993; and
(3) the Committee recommends that the House of
Representatives consider and adopt such amendments.
Subtitle B--Cost Sharing by States
SEC. 4101. COST SHARING BY STATES.
(a) Amendment.--Section 428 of the Higher Education Act of 1965 (20
U.S.C. 1001 et seq.) is amended by adding at the end thereof the
following new subsection:
``(n) State Share of Default Costs.--(1) In the case of any State
in which there are located any institutions of higher education with
cohort default rates that exceed 20 percent, such State shall pay to
the Secretary an amount equal to--
``(A) the new loan volume attributable to all institutions
in the State for the current fiscal year, multiplied by
``(B) the percentage specified in paragraph (2), multiplied
by
``(C) the quotient of--
``(i) the sum of the amounts calculated under
paragraph (3) for each such institution in the State,
divided by
``(ii) the total amount of loan volume attributable
to current and former students of institutions located
in that State entering repayment in the period used to
calculate the cohort default rate.
``(2) For purposes of paragraph (1)(B), the percentage used shall
be--
``(A) 12.5 percent for fiscal year 1995;
``(B) 20 percent for fiscal year 1996; and
``(C) 50 percent for fiscal year 1997 and succeeding fiscal
years.
``(3) For purposes of paragraph (1)(C)(i), the amount shall be
determined by calculating for each institution the amount by which--
``(A) the amount of the loans received for attendance by
its current and former students who (i) enter repayment during
the fiscal year used for the calculation of the cohort default
rate, and (ii) default before the end of the following fiscal
year; exceeds
``(B) 20 percent of the loans received for attendance by
all the current and former students who enter repayment during
the fiscal year used for the calculation of the cohort default
rate.
``(4) A State may charge a fee to an institution of higher
education that participates in the program under this part and is
located in that State according to a fee structure, approved by the
Secretary, that is based on the institution's cohort default rate and
the State's risk of loss under this subsection. Such fee structure
shall include a process by which an institution with a high cohort
default rate is exempt from any fees under this paragraph if such
institution demonstrates to the satisfaction of the State that
exceptional mitigating circumstances, as determined by the State and
approved by the Secretary, contributed to its cohort default rate.''.
(b) Effective Date.--The amendment made by this section shall be
effective on October 1, 1994.
Subtitle C--ERISA Amendments Relating to Group Health Plans
SEC. 4201. COORDINATION OF ERISA PREEMPTION RULES WITH TITLE XIX
PROVISIONS PROVIDING FOR LIABILITY OF THIRD PARTIES.
(a) In General.--Paragraph (8) of section 514(b) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1144(b)(8)) is
amended to read as follows:
``(8)(A) Subsection (a) of this section shall not apply to any
State law to the extent necessary to permit the State to comply with
the following requirements for the receipt of Federal financial
assistance under title XIX of the Social Security Act:
``(i) subparagraphs (A), (B), and (H) of section
1902(a)(25) of such Act (relating to third-party liability) and
section 1903(o) of such Act (relating to medicaid as secondary
payor), as in effect on October 1, 1993; and
``(ii) sections 1902(a)(45) and 1912 of such Act (relating
to assignment of rights of payment), as in effect on May 12,
1993.
``(B) Paragraph (2)(B) shall not apply to any State law to the
extent necessary to permit the compliance of the State with any of the
requirements described in subparagraph (A).''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect October 1, 1993.
SEC. 4202. CONTINUED COVERAGE OF COSTS OF A PEDIATRIC VACCINE UNDER
GROUP HEALTH PLANS.
(a) In General.--Part 6 of subtitle B of title I of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1161 et seq.) is
amended by adding at the end the following new section:
``SEC. 609. CONTINUED COVERAGE OF COSTS OF A PEDIATRIC VACCINE UNDER
GROUP HEALTH PLANS.
``A group health plan may not reduce its coverage of the costs of
pediatric vaccines (as defined under section 2162 of the Public Health
Service Act) below the coverage it provided as of May 1, 1993.''.
(b) Conforming Amendment.--The table of contents in section 1 of
such Act is amended by adding after the item relating to section 608
the following new item:
``Sec. 609. Continued coverage of costs of a pediatric vaccine under
group health plans.''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to plan years beginning after the date of the
enactment of this Act.
SEC. 4203. TEMPORARY RULES GOVERNING PREEMPTION OF CERTAIN STATE LAWS.
Paragraph (5) of section 514(b) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1144(b)(5)) is amended to read as
follows:
``(5)(A)(i) Except as provided in clauses (ii) and (iii),
subsection (a) shall not apply to the Hawaii Prepaid Health Care Act
(Haw. Rev. Stat. Sec. Sec. 393-1 through 393-51).
``(ii) Nothing in clause (i) shall be construed to exempt from
subsection (a) any State tax law relating to employee benefit plans.
``(iii) Notwithstanding clause (i), parts 1 and 4 of this subtitle,
and the preceding sections of this part to the extent they govern
matters which are governed by the provisions of such parts 1 and 4,
shall supersede the Hawaii Prepaid Health Care Act (as in effect on or
after January 14, 1983), but the Secretary may enter into cooperative
arrangements under this subparagraph and section 506 with officials of
the State of Hawaii to assist them in effectuating the policies of
provisions of such Act which are superseded by such parts 1 and 4 and
the preceding sections of this part.
``(B)(i) Except as provided in clauses (ii) and (iii), subsection
(a) shall not apply to subtitle 2 of title 19 of the Annotated Code of
Maryland (relating to the Health Services Cost Review Commission).
``(ii) Nothing in clause (i) shall be construed to exempt from
subsection (a)--
``(I) any State tax law relating to employee benefit plans,
or
``(II) any amendment of the provision referred to in clause
(i) enacted on or after May 12, 1993, to the extent it provides
for more than the effective administration of such Act as in
effect on such date.
``(iii) Notwithstanding clause (i), parts 1 and 4 of this subtitle,
and the preceding sections of this part to the extent they govern
matters which are governed by the provisions of such parts 1 and 4,
shall supersede the provision referred to in clause (i) (as in effect
on or after May 12, 1993), but the Secretary may enter into cooperative
arrangements under this subparagraph and section 506 with officials of
the State of Maryland to assist them in effectuating the policies of
such provision which are superseded by such parts 1 and 4 and the
preceding sections of this part.
``(C)(i) Except as provided in clauses (ii) and (iii), subsection
(a) shall not apply to the following provisions of the law of the State
of Minnesota:
``(I) section 295.52, Minnesota Statutes, as amended in May
1993 by House File 1178 (relating to receipts tax on
providers);
``(II) section 19 of article 9 of the Minnesota Health
Right Act, as amended in May 1993 by House File 1178 (relating
to passthrough of 2 percent gross receipts tax on providers);
and
``(III) subdivision 2 of section 3 of article 1 of such
Act, article 7 of such Act, and section 1 of article 3 of
Minnesota House File 1178 and section 4 and all that follows
through the end of such article 3, as enacted in May 1993
(relating to data collection).
``(ii) Nothing in clause (i) shall be construed to exempt from
subsection (a)--
``(I) any State tax law relating to employee benefit plans
(other than a provision described in clause (i)), and
``(II) any amendment of any provision referred to in clause
(i) enacted on or after May 12, 1993, to the extent it provides
for more than the effective administration of such provision as
in effect on such date.
``(iii) Notwithstanding clause (i), parts 1 and 4 of this subtitle,
and the preceding sections of this part to the extent they govern
matters which are governed by the provisions of such parts 1 and 4,
shall supersede the provisions described in clause (i) (as in effect on
or after May 12, 1993), but the Secretary may enter into cooperative
arrangements under this subparagraph and section 506 with officials of
the State of Minnesota to assist them in effectuating the policies of
such provisions which are superseded by such parts 1 and 4 and the
preceding sections of this part.
``(D)(i) Except as provided in clauses (ii), (iv), (v), and (vii),
subsection (a) shall not apply to the following provisions of the law
of the State of New York:
``(I) subdivisions 1(b) and 4(e) of section 2807-c of the
Public Health Law (relating to 13 percent surcharge);
``(II) subdivision 1(c) of section 2807-c of the Public
Health Law (relating to uniform hospital charges);
``(III) subdivision 2-a of section 2807-c of the Public
Health Law (relating to the variable surcharge for HMOs);
``(IV) subdivision 14 of section 2807-c of the Public
Health Law (relating to basic percentage allowances for bad
debt and charity care);
``(V) subdivision 14-b of section 2807-c of the Public
Health Law (relating to health care services allowances);
``(VI) subdivision 14-c of section 2807-c of the Public
Health Law (relating to further allowances for financially
distressed hospitals); and
``(VII) section 18 of chapter 266 of the laws of 1986, as
amended (relating to excess malpractice insurance adjustments).
``(ii) Except as provided in clause (iii), nothing in clause (i)
shall be construed to exempt from subsection (a)--
``(I) any State tax law relating to employee benefit plans,
or
``(II) any provision referred to in clause (i) to the
extent that any law of the State of New York appropriates
amounts based on amounts collected by the State under such
provision for any purpose other than carrying out the programs
established under the provisions described in clause (i).
``(iii) Notwithstanding clause (ii), subsection (a) shall not apply
to any provision of the law of the State of New York to the extent that
such provision constitutes--
``(I) an HMO surcharge of the type provided for under
subdivision 2-a of such section 2807-c (as in effect on
February 2, 1993), or
``(II) an allowance, of the type provided for under the
provisions referred to in clause (i) (as so in effect), for bad
debts, charity care, health care services, or excess
malpractice insurance,
but only if the law of such State appropriates amounts based on and
equivalent to amounts collected by the State under such provision
solely for the purpose of carrying out one or more programs established
under the provisions described in clause (i).
``(iv) Subsection (a) shall apply to any provision of the law of
the State of New York to the extent that such provision constitutes a
surcharge of the type provided for under subdivisions 1(b) and 4(e) of
section 2807-c of the Public Health Law of the State of New York (as in
effect on February 2, 1993) unless such provision provides for use of
amounts collected under such provision solely for the purpose of
carrying out one or more programs established under the provisions
described in clause (i).
``(v) Nothing in clause (i) shall be construed to exempt from
subsection (a) any amendment of any provision referred to in clause (i)
enacted on or after February 2, 1993, to the extent it provides for
more than the effective administration of such provisions as in effect
on such date, unless such amendment constitutes only a change in the
methodology of determining payments to hospitals and would result in--
``(I) a surcharge described in clause (iii)(I) of not more
than 9 percent with respect to which the requirements of clause
(iii) are met,
``(II) an allowance described in clause (iii)(II) which
does not exceed in the aggregate a Statewide average of not
more than 10 percent and with respect to which the requirements
of clause (iii) are met, or
``(III) a surcharge described in clause (iv) of not more
than 13 percent with respect to which the requirements of
clause (iv) are met.
``(vi) Subsection (a) shall not apply to any amendment to chapter 2
of the laws of 1988 of the State of New York, as amended, to the extent
that such amendment extends the period for which the provisions
referred to in clause (i) are in effect.
``(vii) Notwithstanding clause (i), parts 1 and 4 of this subtitle,
and the preceding sections of this part to the extent they govern
matters which are governed by the provisions of such parts 1 and 4,
shall supersede the provisions described in clause (i) (as in effect on
or after February 2, 1993), but the Secretary may enter into
cooperative arrangements under this subparagraph and section 506 with
officials of the State of New York to assist them in effectuating the
policies of such provisions which are superseded by such parts 1 and 4
and the preceding sections of this part.
``(viii) The provisions of this subparagraph shall be effective as
of February 2, 1993.
``(E) This paragraph shall cease to be effective as of May 12,
1995.''.
TITLE V--COMMITTEE ON ENERGY AND COMMERCE
Subtitle A--Medicare Program
SEC. 5000. REFERENCES IN SUBTITLE; TABLE OF CONTENTS OF SUBTITLE.
(a) Amendments to Social Security Act.--Except as otherwise
specifically provided, whenever in this subtitle an amendment is
expressed in terms of an amendment to or repeal of a section or other
provision, the reference shall be considered to be made to that section
or other provision of the Social Security Act.
(b) References to OBRA.--In this subtitle, the terms ``OBRA-1986'',
``OBRA-1987'', ``OBRA-1989'', and ``OBRA-1990'' refer to the Omnibus
Budget Reconciliation Act of 1986 (Public Law 99-509), the Omnibus
Budget Reconciliation Act of 1987 (Public Law 100-203), the Omnibus
Budget Reconciliation Act of 1989 (Public Law 101-239), and the Omnibus
Budget Reconciliation Act of 1990 (Public Law 101-508), respectively.
(c) Table of Contents of Subtitle.--The table of contents of this
subtitle is as follows:
Sec. 5000. References in subtitle; table of contents of subtitle.
Chasubchapter a--physicians' servicest B
Sec. 5001. Reduction in default update for conversion factor for 1994.
Sec. 5002. Reduction in performance standard rate of increase and
increase in maximum reduction permitted in
default update.
Sec. 5003. Classification of primary care services as a separate
category of services.
Sec. 5004. Phased-in reduction in practice expense relative value units
for certain services.
Sec. 5005. Limitation on payment for the anesthesia care team.
Sec. 5006. Basing payments for anesthesia services on actual time.
Sec. 5007. Separate payment for interpretation of electrocardiograms.
Sec. 5008. Payments for new physicians and practitioners.
Sec. 5009. Geographic adjustment factors for medicare physicians'
services.
Sec. 5010. Extra-billing limits.
Sec. 5011. Relative values for pediatric services.
Sec. 5012. Antigens under physician fee schedule.
Sec. 5013. Administration of claims relating to physicians' services.
Sesubchapter b--outpatient hospital services and ambulatory surgical
services
Sec. 5021. Extension of 10 percent reduction in payments for capital-
related costs of outpatient hospital
services.
Sec. 5022. Extension of current reduction in payments for other costs
of outpatient hospital services.
Sec. 5023. 1-year freeze in ambulatory surgery rates.
Sec. 5024. Eye or eye and ear hospitals.
Sec. 5025. Extension of cap on payments for intraocular lenses.
Sec. 5026. Miscesubchapter c--durable medical equipment
Sec. 5031. Revisions to payment rules for durable medical equipment.
Sec. 5032. Payment for parenteral and enteral nutrients, supplies, and
equipment during 1994.
Sec. 5033. Treatment of nebulizers and aspirators.
Sec. 5034. Certification of suppliers.
Sec. 5035. Prohibition against carrier forum shopping.
Sec. 5036. Restrictions on certain marketing and sales activities.
Sec. 5037. Kickback clarification.
Sec. 5038. Beneficiary liability for noncovered services.
Sec. 5039. Adjustments for inherent reasonableness.
Sec. 5040. Payment for surgical dressings.
Sec. 5041. Payments for tens devices.
Sec. 5042. Miscellaneosubchapter d--part b premium.
Sec. 5051. Part B presubchapter e--other provisions
Sec. 5061. Payments for clinical diagnostic laboratory tests.
Sec. 5062. Treatment of inpatients and provision of diagnostic and
therapeutic X-ray services by rural health
clinics and Federally qualified health
centers.
Sec. 5063. Application of mammography certification requirements.
Sec. 5064. Extension of Alzheimer's disease demonstration.
Sec. 5065. Oral cancer drugs.
Sec. 5066. Extension of municipal health service demonstration
projects.
Sec. 5067. Treatment of certain Indian health programs and facilities
as Federally-qualified health centers.
Sec. 5068. Interest payments.
Sec. 5069. Clarification of coverage of certified nurse-midwife
services performed outside the maternity
cycle.
Sec. 5069A. Increase in, and study of, annual cap on amount of medicare
payment for outpatient physical therapy and
occupational therapy services.
Sec. 5070. Miscellaneous and technical corrections.
Chapter 2--Provisions Relating to Parts A and B
Sec. 5071. Elimination of add-on for overhead of hospital-based home
health agencies.
Sec. 5072. Study and report on medicare GME payments.
Sec. 5073. Medicare as secondary payer.
Sec. 5074. Extension of self-referral ban to additional specified
services.
Sec. 5075. Reduction in payment for erythropoietin.
Sec. 5076. Medicare hospital agreements with organ procurement
organizations.
Sec. 5077. Extension of waiver for Watts Health Foundation.
Sec. 5078. Improved outreach for qualified medicare beneficiaries.
Sec. 5079. Social health maintenance organizations.
Sec. 5080. Peer review organizations.
Sec. 5081. Hospice information to home health beneficiaries.
Sec. 5082. Health maintenance organizations.
Sec. 5083. Miscellaneous and technical corrections.
Chapter 3--Provisions Relating to Medicare Supplemental Insurance
Policies
Sec. 5091. Standards for medicare supplemental insurance policies.
CHAPTER 1--PROVISIONS RELATING TO PART B
Subchapter A--Physicians' Services
SEC. 5001. REDUCTION IN DEFAULT UPDATE FOR CONVERSION FACTOR FOR 1994.
Section 1848(d)(3)(A) (42 U.S.C. 1395w-4(d)(3)(A)) is amended--
(1) in clause (i), by striking ``clause (iii)'' and
inserting ``clauses (iii) and (iv)'', and
(2) by adding at the end the following new clause:
``(iv) Adjustment in percentage increase
for 1994.--In applying clause (i) for services
(other than primary care services) furnished in
1994, the percentage increase in the
appropriate update index shall be reduced by--
``(I) 3 percentage points for
surgical services (as defined for
purposes of subsection (j)(1)), and
``(II) 2 percentage points for
other services.''.
SEC. 5002. REDUCTION IN PERFORMANCE STANDARD RATE OF INCREASE AND
INCREASE IN MAXIMUM REDUCTION PERMITTED IN DEFAULT
UPDATE.
(a) Reduction in Performance Standard Factor.--Section
1848(f)(2)(B) (42 U.S.C. 1395w-4(f)(2)(B)) is amended--
(1) by striking ``and'' at the end of clause (ii), and
(2) by striking clause (iii) and inserting the following:
``(iii) for 1993 is 2 percentage points,
``(iv) for 1994 is 3\1/2\ percentage
points, and
``(v) for each succeeding year is 4
percentage points.''.
(b) Increase in Maximum Reduction Permitted in Default Update.--
Section 1848(d)(3)(B)(ii) (42 U.S.C. 1395w-4(d)(3)(B)(ii)) is amended--
(1) in subclause (II), by striking ``or 1995'', and
(2) in subclause (III), by striking ``3'' and inserting
``5''.
SEC. 5003. CLASSIFICATION OF PRIMARY CARE SERVICES AS A SEPARATE
CATEGORY OF SERVICES.
(a) In General.--Section 1848(j)(1) (42 U.S.C. 1395w-4(j)(1)) is
amended by inserting ``, primary care services (as defined in section
1842(i)(4)),'' after ``Secretary)''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply--
(1) to volume performance standard rates of increase
established under section 1848(f) of the Social Security Act
for fiscal years beginning with fiscal year 1994, and
(2) to updates in the conversion factors for physicians'
services established under section 1848(d) of such Act for
physicians' services to be furnished in calendar years
beginning with 1996.
SEC. 5004. PHASED-IN REDUCTION IN PRACTICE EXPENSE RELATIVE VALUE UNITS
FOR CERTAIN SERVICES.
(a) In General.--Section 1848(c)(2) (42 U.S.C. 1395w-4(c)(2)) is
amended by adding at the end the following new subparagraph:
``(E) Reduction in practice expense relative value
units for certain services.--
``(i) In general.--Subject to clause (ii),
the Secretary shall reduce the practice expense
relative value units applied to services
described in clause (iii) furnished in--
``(I) 1994, by 25 percent of the
number by which the number of practice
expense relative value units
(determined for 1994 without regard to
this subparagraph) exceeds the number
of work relative value units determined
for 1994,
``(II) 1995, by an additional 25
percent of such excess, and
``(III) 1996 and subsequent years,
by an additional 25 percent of such
excess.
``(ii) Floor on reductions.--The practice
expense relative value units for a physicians'
service shall not be reduced under this
subparagraph to a number less than 110 percent
of the number of work relative value units.
``(iii) Services covered.--For purposes of
clause (i), the services described in this
clause are physicians' services that are not
described in clause (iv) and for which--
``(I) there are work relative value
units, and
``(II) the number of practice
expense relative value units
(determined for 1994) exceeds 110
percent of the number of work relative
value units (determined for such year).
``(iv) Excluded services.--For purposes of
clause (iii), the services described in this
clause are--
``(I) anesthesia services,
``(II) radiology services, and
``(III) services which the
Secretary determines at least 75
percent of which are provided under
this title in an office setting.''.
(b) Development of Resource-Based Methodology for Practice
Expenses.--
(1) The Secretary of Health and Human Services shall
develop a methodology for implementing in 1997 a resource-based
system for determining practice expense relative value units
for each physician's service.
(2) The Secretary shall transmit a report by June 30, 1996,
on the methodology developed under paragraph (1) to the
Committees on Ways and Means and Energy and Commerce of the
House of Representatives and the Committee on Finance of the
Senate. The report shall include a presentation of data
utilized in developing the methodology and an explanation of
the methodology.
SEC. 5005. LIMITATION ON PAYMENT FOR THE ANESTHESIA CARE TEAM.
(a) Limit on Payment to a Physician for Medical Direction.--
(1) In general.--Section 1848(a) (42 U.S.C. 1395w-4(a)), as
amended by section 5008(a)(1), is amended by adding at the end
the following new paragraph:
``(4) Special rule for medical direction.--
``(A) In general.--With respect to physicians'
services furnished on or after January 1, 1994, and
consisting of medical direction of two, three, or four
concurrent anesthesia cases, the fee schedule amount to
be applied shall not exceed one-half of the amount
described in subparagraph (B).
``(B) Amount.--The amount described in this
subparagraph, for a physician's medical direction of
the performance of anesthesia services, is the
following percentage of the fee schedule amount
otherwise applicable under this section if the
anesthesia services were personally performed by the
physician alone:
``(i) For services furnished during 1994,
120 percent.
``(ii) For services furnished during 1995,
115 percent.
``(iii) For services furnished during 1996,
110 percent.
``(iv) For services furnished during 1997,
105 percent.
``(v) For services furnished after 1997,
100 percent.''.
(2) Elimination of reduction for medical direction of
multiple nurse anesthetists.--Section 1842(b) (42 U.S.C.
1395u(b)) is amended by striking paragraph (13).
(b) Payment to a Certified Registered Nurse Anesthetist for
Medically Directed Services.--Subparagraph (B) of section 1833(l)(4)
(42 U.S.C. 1395l(l)(4)) is amended--
(1) in clause (i), by inserting ``and before January 1,
1994,'' after ``1991,'';
(2) in clause (ii)--
(A) by adding ``and'' at the end of subclause (II),
(B) by striking the comma at the end of subclause
(III) and inserting a period, and
(C) by striking subclauses (IV) through (VII); and
(3) by adding at the end the following new clause:
``(iii) In the case of services of a certified registered nurse
anesthetist who is medically directed by a physician and that are
furnished on or after January 1, 1994, the fee schedule amount shall be
one-half of the amount described in section 1848(a)(4)(B) with respect
to the physician.''.
SEC. 5006. BASING PAYMENTS FOR ANESTHESIA SERVICES ON ACTUAL TIME.
(a) Physicians' Services.--Section 1848(b)(2)(B) (42 U.S.C. 1395w-
4(b)(2)(B)) is amended by adding at the end the following: ``For
anesthesia services furnished on or after January 1, 1994, the
Secretary may not modify the methodology in effect as of January 1,
1993, for determining the amount of time that may be billed for such
services under this section.''.
(b) Services of Certified Registered Nurse Anesthetists.--Section
1833(l)(1)(B) (42 U.S.C. 1395l(l)(1)(B)) is amended by adding at the
end the following: ``For anesthesia services furnished on or after
January 1, 1994, the Secretary may not modify the methodology in effect
as of January 1, 1993, for determining the amount of time that may be
billed for such services under this section.''.
SEC. 5007. SEPARATE PAYMENT FOR INTERPRETATION OF ELECTROCARDIOGRAMS.
(a) In General.--Paragraph (3) of section 1848(b) (42 U.S.C. 1395w-
4(b)) is amended to read as follows:
``(3) Treatment of interpretation of electrocardiograms.--
The Secretary--
``(A) shall make separate payment under this
section for the interpretation of electrocardiograms
performed or ordered to be performed as part of or in
conjunction with a visit to or a consultation with a
physician, and
``(B) shall adjust the relative values established
for visits and consultations under subsection (c) so as
not to include relative value units for interpretations
of electrocardiograms in the relative value for visits
and consultations.''.
(b) Assuring Budget Neutrality.--Section 1848(c)(2) (42 U.S.C.
1395w-4(c)(2)), as amended by section 5004(a); is amended by adding at
the end the following new subparagraph:
``(F) Budget neutrality adjustments.--The
Secretary--
``(i) shall reduce the relative values for
all services (other than anesthesia services)
established under this paragraph (and, in the
case of anesthesia services, the conversion
factor established by the Secretary for such
services) by such percentage as the Secretary
determines to be necessary so that, beginning
in 1996, the amendment made by section 5007(a)
of the Omnibus Budget Reconciliation Act of
1993 would not result in expenditures under
this section that exceed the amount of such
expenditures that would have been made if such
amendment had not been made, and
``(ii) shall reduce the amounts determined
under subsection (a)(2)(B)(ii)(I) by such
percentage as the Secretary determines to be
required to assure that, taking into account
the reductions made under clause (i), the
amendment made by section 5007(a) of the
Omnibus Budget Reconciliation Act of 1993 would
not result in expenditures under this section
in 1994 that exceed the amount of such
expenditures that would have been made if such
amendment had not been made.''.
(c) Conforming Amendments.--Section 1848 (42 U.S.C. 1395w-4) is
amended--
(1) in subsection (a)(2)(B)(ii)(I), by inserting ``and as
adjusted under subsection (c)(2)(F)(ii)'' after ``for 1994'';
(2) in subsection (c)(2)(A)(i), by adding at the end the
following: ``Such relative values are subject to adjustment
under subparagraph (F)(i).''; and
(3) in subsection (i)(1)(B), by adding at the end
``including adjustments under subsection (c)(2)(F),''.
(d) Effective Date.--The amendments made by this section shall
apply to services furnished on or after January 1, 1994.
SEC. 5008. PAYMENTS FOR NEW PHYSICIANS AND PRACTITIONERS.
(a) Equal Treatment of New Physicians and Practitioners.--(1)
Section 1848(a) (42 U.S.C. 1395w-4(a)) is amended by striking paragraph
(4).
(2) Section 1842(b)(4) (42 U.S.C. 1395u(b)(4)) is amended by
striking subparagraph (F).
(b) Budget Neutrality Adjustment.--Notwithstanding any other
provision of law, the Secretary of Health and Human Services shall
reduce the following values and amounts for 1994 (to be applied for
that year and subsequent years) by such uniform percentage as the
Secretary determines to be required to assure that the amendments made
by subsection (a) will not result in expenditures under part B of title
XVIII of the Social Security Act in 1994 that exceed the amount of such
expenditures that would have been made if such amendments had not been
made:
(1) The relative values established under section 1848(c)
of such Act for services (other than anesthesia services) and,
in the case of anesthesia services, the conversion factor
established under section 1848 of such Act for such services.
(2) The amounts determined under section
1848(a)(2)(B)(ii)(I) of such Act.
(3) The prevailing charges or fee schedule amounts to be
applied under such part for services of a health care
practitioner (as defined in section 1842(b)(4)(F)(ii)(I) of
such Act, as in effect before the date of the enactment of this
Act).
(c) Conforming Amendments.--Section 1848 (42 U.S.C. 1395w-4), as
amended by section 5007(c), is amended--
(1) in subsection (a)(2)(B)(ii)(I), by inserting ``and
section 5008(b) of the Omnibus Budget Reconciliation Act of
1993'' after ``(c)(2)(F)(ii)'';
(2) in subsection (c)(2)(A)(i), by inserting ``and section
5008(b) of the Omnibus Budget Reconciliation Act of 1993''
after ``under subparagraph (F)(i)''; and
(3) in subsection (i)(1)(B), by inserting ``and section
5008(b) of the Omnibus Budget Reconciliation Act of 1993''
after ``under subsection (c)(2)(F)''.
(d) Effective Date.--The amendments made by subsection (a) shall
apply to services furnished on or after January 1, 1994.
SEC. 5009. GEOGRAPHIC ADJUSTMENT FACTORS FOR MEDICARE PHYSICIANS'
SERVICES.
(a) Requiring Consultation with Representatives of Physicians in
Reviewing Geographic Adjustment Factors.--Section 1848(e)(1)(C) (42
U.S.C. 1395w-4(e)(1)(C)) is amended by striking ``shall review'' and
inserting ``shall, in consultation with appropriate representatives of
physicians, review''.
(b) Use of Most Recent Data In Geographic Adjustment.--Section
1848(e)(1) (42 U.S.C. 1395w-4(e)(1)) is amended by adding at the end
the following new subparagraph:
``(D) Use of recent data.--In establishing indices
and index values under this paragraph, the Secretary
shall use the most recent data available relating to
practice expenses, malpractice expenses, and physician
work effort in different fee schedule areas.''.
(c) Deadline for Initial Review and Revision.--The Secretary of
Health and Human Services shall first review and revise geographic
adjustment factors under section 1848(e)(1)(C) of the Social Security
Act by not later than January 1, 1995.
(d) Report on Review Process.--Not later than 1 year after the date
of the enactment of this Act, the Secretary of Health and Human
Services shall study and report to the Committee on Finance of the
Senate and the Committee on Ways and Means and the Committee on Energy
and Commerce of the House of Representatives on--
(1) the data necessary to review and revise the indices
established under section 1848(e)(1)(A) of the Social Security
Act, including--
(A) the shares allocated to physicians' work
effort, practice expenses (other than malpractice
expenses), and malpractice expenses;
(B) the weights assigned to the input components of
such shares; and
(C) the index values assigned to such components;
(2) any limitations on the availability of data necessary
to review and revise such indices at least every three years;
(3) ways of addressing such limitations, with particular
attention to the development of alternative data sources for
input components for which current index values are based on
data collected less frequently than every three years; and
(4) the costs of developing more accurate and timely data.
SEC. 5010. EXTRA-BILLING LIMITS.
(a) Enforcement and Uniform Application.--
(1) Enforcement.--Paragraph (1) of section 1848(g) (42
U.S.C. 1395w-4(g)) is amended to read as follows:
``(1) Limitation on actual charges.--
``(A) In general.--In the case of a
nonparticipating physician or nonparticipating supplier
or other person (as defined in section 1842(i)(2)) who
does not accept payment on an assignment-related basis
for a physician's service furnished with respect to an
individual enrolled under this part, the following
rules apply:
``(i) Application of limiting charge.--No
person may bill or collect an actual charge for
the service in excess of the limiting charge
described in paragraph (2) for such service.
``(ii) No liability for excess charges.--No
person is liable for payment of any amounts
billed for the service in excess of such
limiting charge.
``(iii) Correction of excess charges.--If
such a physician, supplier, or other person
bills, but does not collect, an actual charge
for a service in violation of clause (i), the
physician, supplier, or other person shall
reduce on a timely basis the actual charge
billed for the service to an amount not to
exceed the limiting charge for the service.
``(iv) Refund of excess collections.--If
such a physician, supplier, or other person
collects an actual charge for a service in
violation of clause (i), the physician,
supplier, or other person shall provide on a
timely basis a refund to the individual charged
in the amount by which the amount collected
exceeded the limiting charge for the service.
The amount of such a refund shall be reduced to
the extent the individual has an outstanding
balance owed by the individual to the
physician.
``(B) Sanctions.--If a physician, supplier, or
other person--
``(i) knowingly and willfully bills or
collects for services in violation of
subparagraph (A)(i) on a repeated basis, or
``(ii) fails to comply with clause (iii) or
(iv) of subparagraph (A) on a timely basis,
the Secretary may apply sanctions against the
physician, supplier, or other person in accordance with
paragraph (2) of section 1842(j). In applying this
subparagraph, paragraph (4) of such section applies in
the same manner as such paragraph applies to such
section and any reference in such section to a
physician is deemed also to include a reference to a
supplier or other person under this subparagraph.
``(C) Timely basis.--For purposes of this
paragraph, a correction of a bill for an excess charge
or refund of an amount with respect to a violation of
subparagraph (A)(i) in the case of a service is
considered to be provided `on a timely basis', if the
reduction or refund is made not later than 30 days
after the date the physician, supplier, or other person
is notified by the carrier under this part of such
violation and of the requirements of subparagraph
(A).''.
(2) Uniform application of extra-billing limits to
physicians' services.--
(A) In general.--Section 1848(g)(2)(C) (42 U.S.C.
1395w-4(g)(2)(C)) is amended by inserting ``or for
nonparticipating suppliers or other persons'' after
``nonparticipating physicians''.
(B) Conforming definition.--Section 1842(i)(2) (42
U.S.C. 1395u(i)(2)) is amended--
(i) by striking ``, and the term'' and
inserting ``; the term'', and
(ii) by inserting before the period at the
end the following: ``; and the term
`nonparticipating supplier or other person'
means a supplier or other person (excluding a
provider of services) that is not a
participating physician or supplier (as defined
in subsection (h)(1))''.
(3) Additional conforming amendments.--Section 1848 (42
U.S.C. 1395w-4) is amended--
(A) in subsection (a)(3)--
(i) by inserting ``and suppliers'' after
``physicians'',
(ii) by inserting ``or a nonparticipating
supplier or other person'' after
``nonparticipating physician'', and
(iii) by adding at the end the following:
``In the case of physicians' services
(including services which the Secretary
excludes pursuant to subsection (j)(3)) of a
nonparticipating physician, supplier, or other
person for which payment is made under this
part on a basis other than the fee schedule
amount, the payment shall be based on 95
percent of the payment basis for such services
furnished by a participating physician,
supplier, or other person.'';
(B) in subsection (g)(1)(A), as amended by
subsection (a), in the matter before clause (i), by
inserting ``(including services which the Secretary
excludes pursuant to subsection (j)(3))'' after ``a
physician's service'';
(C) in subsection (g)(2)(D), by inserting ``(or, if
payment under this part is made on a basis other than
the fee schedule under this section, 95 percent of the
other payment basis)'' after ``subsection (a)'';
(D) in subsection (g)(3)(B)--
(i) by inserting after the first sentence
the following: ``No person is liable for
payment of any amounts billed for such a
service in violation of the previous
sentence.'', and
(ii) in the last sentence, by striking
``previous sentence'' and inserting ``first
sentence'';
(E) in subsection (h)--
(i) by inserting ``or nonparticipating
supplier or other person furnishing physicians'
services (as defined in section 1848(j)(3))''
after ``physician'' the first place it appears,
(ii) by inserting ``, supplier, or other
person'' after ``physician'' the second place
it appears, and
(iii) by inserting ``, suppliers, and other
persons'' after ``physicians'' the second place
it appears; and
(F) in subsection (j)(3), by inserting ``, except
for purposes of subsections (a)(3), (g), and (h)''
after ``tests and''.
(b) Clarification of Mandatory Assignment Rules for Certain
Practitioners.--
(1) In general.--Section 1842(b) (42 U.S.C. 1395u(b)), as
amended by section 5014(e), is amended by adding at the end the
following new paragraph:
``(18)(A) Payment for any service furnished by a practitioner
described in subparagraph (C) and for which payment may be made under
this part on a reasonable charge or fee schedule basis may only be made
under this part on an assignment-related basis.
``(B) A practitioner described in subparagraph (C) or other person
may not bill (or collect any amount from) the individual or another
person for any service described in subparagraph (A), except for
deductible and coinsurance amounts applicable under this part. No
person is liable for payment of any amounts billed for such a service
in violation of the previous sentence. If a practitioner or other
person knowingly and willfully bills (or collects an amount) for such a
service in violation of such sentence, the Secretary may apply
sanctions against the practitioner or other person in the same manner
as the Secretary may apply sanctions against a physician in accordance
with section 1842(j)(2) in the same manner as such section applies with
respect to a physician. Paragraph (4) of section 1842(j) shall apply in
this subparagraph in the same manner as such paragraph applies to such
section.
``(C) A practitioner described in this subparagraph is any of the
following:
``(i) A physician assistant, nurse practitioner, or
clinical nurse specialist (as defined in section 1861(aa)(5)).
``(ii) A certified registered nurse anesthetist (as defined
in section 1861(bb)(2)).
``(iii) A certified nurse-midwife (as defined in section
1861(gg)(2)).
``(iv) A clinical social worker (as defined in section
1861(hh)(1)).
``(v) A clinical psychologist (as defined by the Secretary
for purposes of section 1861(ii)).
``(D) For purposes of this paragraph, a service furnished by a
practitioner described in subparagraph (C) includes any services and
supplies furnished as incident to the service as would otherwise be
covered under this part if furnished by a physician or as incident to a
physician's service.''.
(2) Conforming amendments.--
(A) Section 1833 (42 U.S.C. 1395l) is amended--
(i) in subsection (l)(5), by striking
subparagraph (B) and redesignating subparagraph
(C) as subparagraph (B);
(ii) by striking subsection (p); and
(iii) in subsection (r), by striking
paragraph (3) and redesignating paragraph (4)
as paragraph (3).
(B) Section 1842(b)(12) (42 U.S.C. 1395u(b)(12)) is
amended by striking subparagraph (C).
(c) Information on Extra-Billing Limits.--
(1) Part of explanation of medicare benefits.--Section
1842(h)(7) (42 U.S.C. 1395u(h)(7)) is amended--
(A) by striking ``and'' at the end of subparagraph
(B),
(B) in subparagraph (C), by striking ``shall
include'',
(C) in subparagraph (C), by striking the period at
the end and inserting ``, and'', and
(D) by adding at the end the following new
subparagraph:
``(D) in the case of services for which the billed amount
exceeds the limiting charge imposed under section 1848(g),
information regarding such applicable limiting charge
(including information concerning the right to a refund under
section 1848(g)(1)(A)(iv)).''.
(2) Determinations by carriers.--Subparagraph (G) of
section 1842(b)(3) (42 U.S.C. 1395u(b)(3)) is amended to read
as follows:
``(G) will, for a service that is furnished with respect to
an individual enrolled under this part, that is not paid on an
assignment-related basis, and that is subject to a limiting
charge under section 1848(g)--
``(i) determine, prior to making payment, whether
the amount billed for such service exceeds the limiting
charge applicable under section 1848(g)(2);
``(ii) notify the physician, supplier, or other
person periodically (but not less often than once every
30 days) of determinations that amounts billed exceeded
such applicable limiting charges; and
``(iii) provide for prompt response to inquiries of
physicians, suppliers, and other persons concerning the
accuracy of such limiting charges for their
services;''.
(d) Report on Charges in Excess of Limiting Charge.--Section
1848(g)(6)(B) (42 U.S.C. 1395w-4(g)(6)(B)) is amended by inserting
``the extent to which actual charges exceed limiting charges, the
number and types of services involved, and the average amount of excess
charges and'' after ``report to the Congress''.
(e) Miscellaneous and Technical Amendments.--Section 1833 (42
U.S.C. 1395l) is amended--
(1) in subsection (a)(1), as amended by section
5070(e)(2)--
(A) by striking ``and'' before ``(O)'', and
(B) by inserting before the semicolon at the end
the following: ``, and (P) with respect to services
described in clauses (i), (ii) and (iv) of section
1861(s)(2)(K), the amounts paid are subject to the
provisions of section 1842(b)(12)''; and
(2) in subsection (h)(5)(D)--
(A) by striking ``paragraphs (2) and (3)'' and by
inserting ``paragraph (2)'', and
(B) by adding at the end the following: ``Paragraph
(4) of such section shall apply in this subparagraph in
the same manner as such paragraph applies to such
section.''.
(f) Effective Dates.--
(1) Enforcement and uniform application; miscellaneous and
technical amendments.--The amendments made by subsections (a)
and (e) shall apply to services furnished on or after the date
of the enactment of this Act; except that the amendments made
by subsection (a) shall not apply to services of a
nonparticipating supplier or other person furnished before
January 1, 1994.
(2) Practitioners.--The amendments made by subsection (b)
shall apply to services furnished on or after January 1, 1994.
(3) EOMBs.--The amendments made by subsection (c)(1) shall
apply to explanations of benefits provided on or after January
1, 1994.
(4) Carrier determinations.--The amendments made by
subsection (c)(2) shall apply to contracts as of January 1,
1994.
(5) Report.--The amendment made by subsection (d) shall
apply to reports for years beginning with 1994.
SEC. 5011. RELATIVE VALUES FOR PEDIATRIC SERVICES.
(a) In General.--The Secretary of Health and Human Services shall
fully develop, by not later than July 1, 1994, relative values for the
full range of pediatric physicians' services which are consistent with
the relative values developed for other physicians' services under
section 1848(c) of the Social Security Act. In developing such values,
the Secretary shall conduct such refinements as may be necessary to
produce appropriate estimates for such relative values.
(b) Study.--
(1) In general.--The Secretary shall conduct a study of the
relative values for pediatric and other services to determine
whether there are significant variations in the resources used
in providing similar services to different populations. In
conducting such study, the Secretary shall consult with
appropriate organizations representing pediatricians and other
physicians and physical and occupational therapists.
(2) Report.--Not later than July 1, 1994, the Secretary
shall submit to Congress a report on the study conducted under
paragraph (1). Such report shall include any appropriate
recommendations regarding needed changes in coding or other
payment policies to ensure that payments for pediatric services
appropriately reflect the resources required to provide these
services.
SEC. 5012. ANTIGENS UNDER PHYSICIAN FEE SCHEDULE.
(a) In General.--Section 1848(j)(3) (42 U.S.C. 1395w-4(j)(3)) is
amended by inserting ``(2)(G),'' after ``(2)(D),''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to services furnished on or after January 1, 1994.
SEC. 5013. ADMINISTRATION OF CLAIMS RELATING TO PHYSICIANS' SERVICES.
(a) Limitation on Carrier User Fees.--Section 1842(c) (42 U.S.C.
1395u(c)) is amended by adding at the end the following new paragraph:
``(4) Neither a carrier nor the Secretary may impose a fee under
this title--
``(A) for the filing of claims related to physicians'
services,
``(B) for an error in filing a claim relating to
physicians' services or for such a claim which is denied,
``(C) for any appeal under this title with respect to
physicians' services,
``(D) for applying for (or obtaining) a unique identifier
under subsection (r), or
``(E) for responding to inquiries respecting physicians'
services or for providing information with respect to medical
review of such services.''.
(b) Clarification of Permissible Substitute Billing Arrangements.--
(1) In general.--Clause (D) of section 1842(b)(6) (42
U.S.C. 1395u(b)(6)) is amended to read as follows: ``(D)
payment may be made to a physician for physicians' services
(and services furnished incident to such services) furnished by
a second physician to patients of the first physician if (i)
the first physician is unavailable to provide the services;
(ii) the services are furnished pursuant to an arrangement
between the two physicians that (I) is informal and reciprocal,
or (II) involves per diem or other fee-for-time compensation
for such services; (iii) the services are not provided by the
second physician over a continuous period of more than 60 days;
and (iv) the claim form submitted to the carrier for such
services includes the second physician's unique identifier
(provided under the system established under subsection (r))
and indicates that the claim meets the requirements of this
clause for payment to the first physician''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to services furnished on or after the first day of
the first month beginning more than 60 days after the date of
the enactment of this Act.
SEC. 5014. MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Overvalued Procedures (Section 4101 of OBRA-1990).--(1) Section
1842(b)(16)(B)(iii) (42 U.S.C. 1395u(b)(16)(B)(iii)) is amended--
(A) by striking ``, simple and subcutaneous'',
(B) by striking ``; small'' and inserting ``and small'',
(C) by striking ``treatments;'' the first place it appears
and inserting ``and'',
(D) by striking ``lobectomy;'',
(E) by striking ``enterectomy; colectomy;
cholecystectomy;'',
(F) by striking ``; transurerethral resection'' and
inserting ``and resection'', and
(G) by striking ``sacral laminectomy;''.
(2) Section 4101(b)(2) of OBRA-1990 is amended--
(A) in the matter before subparagraph (A), by striking
``1842(b)(16)'' and inserting ``1842(b)(16)(B)'', and
(B) in subparagraph (B)--
(i) by striking ``, simple and subcutaneous'',
(ii) by striking ``(HCPCS codes 19160 and 19162)''
and inserting ``(HCPCS code 19160)'', and
(iii) by striking all that follows ``(HCPCS codes
92250'' and inserting ``and 92260).''.
(b) Radiology Services (Section 4102 of OBRA-1990).--(1) Section
1834(b)(4) (42 U.S.C. 1395m(b)(4)) is amended by redesignating
subparagraphs (E) and (F) as subparagraphs (F) and (G), respectively.
(2) Section 1834(b)(4)(D) (42 U.S.C. 1395m(b)(4)(D)) is amended--
(A) in the matter before clause (i), by striking ``shall be
determined as follows:'' and inserting ``shall, subject to
clause (vii), be reduced to the adjusted conversion factor for
the locality determined as follows:'',
(B) in clause (iv), by striking ``Local adjustment.--
Subject to clause (vii), the conversion factor to be applied
to'' and inserting ``Adjusted conversion factor.--The adjusted
conversion factor for'',
(C) in clause (vii), by striking ``under this
subparagraph'', and
(D) in clause (vii), by inserting ``reduced under this
subparagraph by'' after ``shall not be''.
(3) Section 4102(c)(2) of OBRA-1990 is amended by striking
``radiology services'' and all that follows and inserting ``nuclear
medicine services.''.
(4) Section 4102(d) of OBRA-1990 is amended by striking ``new
paragraph'' and inserting ``new subparagraph''.
(5) Section 1834(b)(4)(E) (42 U.S.C. 1395m(b)(4)(E)) is amended by
inserting ``Rule for certain scanning services.--'' after ``(E)''.
(6) Section 1848(a)(2)(D)(iii) (42 U.S.C. 1395w-4(a)(2)(D)(iii)) is
amended by striking ``that are subject to section 6105(b) of the
Omnibus Budget Reconciliation Act of 1989'' and by striking ``provided
under such section'' and inserting ``provided under section 6105(b) of
the Omnibus Budget Reconciliation Act of 1989''.
(c) Anesthesia Services (Section 4103 of OBRA-1990).--(1) Section
4103(a) of OBRA-1990 is amended by striking ``Reduction in Fee
Schedule'' and inserting ``Reduction in Prevailing Charges''.
(2) Section 1842(q)(1)(B) (42 U.S.C. 1395u(q)(1)(B)) is amended--
(A) in the matter before clause (i), by striking ``shall be
determined as follows:'' and inserting ``shall, subject to
clause (iv), be reduced to the adjusted prevailing charge
conversion factor for the locality determined as follows:'',
and
(B) in clause (iii), by striking ``Subject to clause (iv),
the prevailing charge conversion factor to be applied in'' and
inserting ``The adjusted prevailing charge conversion factor
for''.
(d) Assistants at Surgery (Section 4107 of OBRA-1990).--(1) Section
4107(c) of OBRA-1990 is amended by inserting ``(a)(1)'' after
``subsection''.
(2) Section 4107(a)(2) of OBRA-1990 is amended by adding at the end
the following: ``In applying section 1848(g)(2)(D) of the Social
Security Act for services of an assistant-at-surgery furnished during
1991, the recognized payment amount shall not exceed the maximum amount
specified under section 1848(i)(2)(A) of such Act (as applied under
this paragraph in such year).''.
(e) Technical Components of Diagnostic Services (Section 4108 of
OBRA-1990).--Section 1842(b) (42 U.S.C. 1395u(b)) is amended by
redesignating paragraph (18), as added by section 4108(a) of OBRA-1990,
as paragraph (17) and, in such paragraph, by inserting ``, tests
specified in paragraph (14)(C)(i),'' after ``diagnostic laboratory
tests''.
(f) Statewide Fee Schedules (Section 4117 of OBRA-1990).--Section
4117 of OBRA-1990 is amended--
(1) in subsection (a)--
(A) by striking ``(a) In General.--'', and
(B) by striking ``, if the'' and all that follows
through ``1991, ''; and
(2) by striking subsections (b), (c), and (d).
(g) Study of Aggregation Rule for Claims of Similar Physician
Services (Section 4113 of OBRA-1990).--Section 4113 of OBRA-1990 is
amended--
(1) by inserting ``of the Social Security Act'' after
``1869(b)(2)''; and
(2) by striking ``December 31, 1992'' and inserting
``December 31, 1993''.
(h) Other Miscellaneous and Technical Amendments.--(1) The heading
of section 1834(f) (42 U.S.C. 1395m(f)) is amended by striking ``Fiscal
Year''.
(2)(A) Section 4105(b) of OBRA-1990 is amended--
(i) in paragraph (2), by striking ``amendments'' and
inserting ``amendment'', and
(ii) in paragraph (3), by striking ``amendments made by
paragraphs (1) and (2)'' and inserting ``amendment made by
paragraph (1)''.
(B) Section 1848(f)(2)(C) (42 U.S.C. 1395w-4(f)(2)(C)) is amended
by inserting ``Performance standard rates of increase for fiscal year
1991.--'' after ``(C)''.
(C) Section 4105(d) of OBRA-1990 is amended by inserting
``Publication of Performance Standard Rates.--'' after ``(d)''.
(3) Section 1842(b)(4)(F) (42 U.S.C. 1395u(b)(4)(F)) is amended--
(A) in clause (i), by striking ``prevailing charge'' the
first place it appears and inserting ``customary charge''; and
(B) in clause (ii)(III), by striking ``second, third, and
fourth'' and inserting ``first, second, and third''.
(4) Section 1842(b)(4)(F)(ii)(I) (42 U.S.C. 1395u(b)(4)(F)(ii)(I))
is amended by striking ``respiratory therapist,''.
(5) Section 4106(c) of OBRA-1990 is amended by inserting ``of the
Social Security Act'' after ``1848(d)(1)(B)''.
(6) Section 4114 of OBRA-1990 is amended by striking ``patients''
the second place it appears.
(7) Section 1848(e)(1)(C) (42 U.S.C. 1395w-4(e)(1)(C)) is amended
by inserting ``date of the'' after ``since the''.
(8) Section 4118(f)(1)(D) of OBRA-1990 is amended by striking ``is
amended''.
(9) Section 4118(f)(1)(N)(ii) of OBRA-1990 is amended by striking
``subsection (f)(5)(A)'' and inserting ``subsection (f)(5)(A))''.
(10) Section 1845(e) (42 U.S.C. 1395w-1(e)) is amended--
(A) by striking paragraph (2); and
(B) by redesignating paragraphs (3), (4), and (5) as
paragraphs (2), (3), and (4).
(11) Section 4118(j)(2) of OBRA-1990 is amended by striking ``In
section'' and inserting ``Section''.
(12)(A) Section 1848(i)(3) (42 U.S.C. 1395w-4(i)(3)) is amended by
striking the space before the period at the end.
(B) Section 1834(a)(10)(B) (42 U.S.C. 1395m(a)(10)(B)) is amended
by striking ``as such provisions apply to physicians' services and
physicians and a reasonable charge under section 1842(b)''.
(i) Other Corrections.--(1) Effective on the date of the enactment
of this Act, section 6102(d)(4) of OBRA-1989 is amended by striking all
that follows the first sentence.
(2) Effective for payments for fiscal years beginning with fiscal
year 1994, section 1842(c)(1) (42 U.S.C. 1395u(c)(1)) is amended--
(A) in subparagraph (A), by striking ``(A) Any contract''
and inserting ``Any contract''; and
(B) by striking subparagraph (B).
(j) Effective Date.--Except as provided in subsection (i), the
amendments made by this section and the provisions of this section
shall take effect as if included in the enactment of OBRA-1990.
Subchapter B--Outpatient Hospital Services and Ambulatory Surgical
Services
SEC. 5021. EXTENSION OF 10 PERCENT REDUCTION IN PAYMENTS FOR CAPITAL-
RELATED COSTS OF OUTPATIENT HOSPITAL SERVICES.
Section 1861(v)(1)(S)(ii)(I) (42 U.S.C. 1395x(v)(1)(S)(ii)(I)) is
amended by striking ``fiscal year 1992, 1993, 1994, or 1995'' and
inserting ``fiscal years 1992 through 1998''.
SEC. 5022. EXTENSION OF CURRENT REDUCTION IN PAYMENTS FOR OTHER COSTS
OF OUTPATIENT HOSPITAL SERVICES.
Section 1861(v)(1)(S)(ii)(II) (42 U.S.C. 1395x(v)(1)(S)(ii)(II)) is
amended by striking ``1991'' and all that follows and inserting ``1991
through 1998.''.
SEC. 5023. 1-YEAR FREEZE IN AMBULATORY SURGERY RATES.
The Secretary of Health and Human Services shall not provide for
any update in the amounts of payment described in paragraphs (2)(A) and
(2)(B) of section 1833(i)(2) of the Social Security Act that otherwise
would occur in fiscal year 1994.
SEC. 5024. EYE OR EYE AND EAR HOSPITALS.
(a) In General.--Section 1833(i) (42 U.S.C. 1395l(i)) is amended--
(1) in paragraph (3)(B)(ii)--
(A) by striking ``the last sentence of this
clause'' and inserting ``paragraph (4)'', and
(B) by striking the last sentence; and
(2) by inserting after paragraph (3) the following new
paragraph:
``(4)(A) In the case of a hospital that--
``(i) makes application to the Secretary and demonstrates
that it specializes in eye services or eye and ear services (as
determined by the Secretary),
``(ii) receives more than 30 percent of its total revenues
from outpatient services, and
``(iii) on October 1, 1987--
``(I) was an eye specialty hospital or an eye and
ear specialty hospital, or
``(II) was operated as an eye or eye and ear unit
(as defined in subparagraph (B)) of a general acute
care hospital which, on the date of the application
described in clause (i), operates less than 20 percent
of the beds that the hospital operated on October 1,
1987, and has sold or otherwise disposed of a
substantial portion of the hospital's other acute care
operations,
the cost proportion and ASC proportion in effect under subclauses (I)
and (II) of paragraph (3)(B)(ii) for cost reporting periods beginning
in fiscal year 1988 shall remain in effect for cost reporting periods
beginning on or after October 1, 1988, and before January 1, 1995.
``(B) For purposes of this subparagraph (A)(iii)(II), the term `eye
or eye and ear unit' means a physically separate or distinct unit
containing separate surgical suites devoted solely to eye or eye and
ear services.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to portions of cost reporting periods beginning on or after
January 1, 1994.
SEC. 5025. EXTENSION OF CAP ON PAYMENTS FOR INTRAOCULAR LENSES.
(a) In General.--Section 4151(c)(3) of OBRA-1990 is amended by
striking ``December 31, 1992'' and inserting ``December 31, 1994''.
(b) Effective Date.--The amendment made by subsection (a) shall be
effective as if included in the enactment of OBRA-1990.
SEC. 5026. MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Payment Amounts for Services Furnished in Ambulatory Surgical
Centers.--(1)(A) Section 1833(i)(2)(A)(i) (42 U.S.C. 1395l(i)(2)(A)(i))
is amended by striking the comma at the end and inserting the
following: ``, as determined in accordance with a survey (based upon a
representative sample of procedures and facilities) taken not later
than January 1, 1995, and every 5 years thereafter, of the actual
audited costs incurred by such centers in providing such services,''.
(B) Section 1833(i)(2) (42 U.S.C. 1395l(i)(2)) is amended--
(i) in the second sentence of subparagraph (A) and the
second sentence of subparagraph (B), by striking ``and may be
adjusted by the Secretary, when appropriate,''; and
(ii) by adding at the end the following new subparagraph:
``(C) Notwithstanding the second sentence of subparagraph (A) or
the second sentence of subparagraph (B), if the Secretary has not
updated amounts established under such subparagraphs with respect to
facility services furnished during a fiscal year (beginning with fiscal
year 1996), such amounts shall be increased by the percentage increase
in the consumer price index for all urban consumers (U.S. city average)
as estimated by the Secretary for the 12-month period ending with the
midpoint of the fiscal year involved.''.
(C) The second sentence of section 1833(i)(1) (42 U.S.C.
1395l(i)(1)) is amended by striking the period and inserting the
following: ``, in consultation with appropriate trade and professional
organizations.''.
(2) Section 4151(c)(3) of OBRA-1990 is amended by striking ``for
the insertion of an intraocular lens'' and inserting ``for an
intraocular lens inserted''.
(b) Adjustments to Payment Amounts for New Technology Intraocular
Lenses.--(1) Not later than 1 year after the date of the enactment of
this Act, the Secretary of Health and Human Services (in this
subsection referred to as the ``Secretary'') shall develop and
implement a process under which interested parties may request review
by the Secretary of the appropriateness of the reimbursement amount
provided under section 1833(i)(2)(A)(iii) of the Social Security Act
with respect to a class of new technology intraocular lenses. For
purposes of the preceding sentence, an intraocular lens may not be
treated as a new technology lens unless it has been approved by the
Food and Drug Administration.
(2) In determining whether to provide an adjustment of payment with
respect to a particular lens under paragraph (1), the Secretary shall
take into account whether use of the lens is likely to result in
reduced risk of intraoperative or postoperative complication or trauma,
accelerated postoperative recovery, reduced induced astigmatism,
improved postoperative visual acuity, more stable postoperative vision,
or other comparable clinical advantages.
(3) The Secretary shall publish notice in the Federal Register from
time to time (but no less often than once each year) of a list of the
requests that the Secretary has received for review under this
subsection, and shall provide for a 30-day comment period on the lenses
that are the subjects of the requests contained in such notice. The
Secretary shall publish a notice of his determinations with respect to
intraocular lenses listed in the notice within 90 days after the close
of the comment period.
(4) Any adjustment of a payment amount (or payment limit) made
under this subsection shall become effective not later than 30 days
after the date on which the notice with respect to the adjustment is
published under paragraph (3).
Subchapter C--Durable Medical Equipment
SEC. 5031. REVISIONS TO PAYMENT RULES FOR DURABLE MEDICAL EQUIPMENT.
(a) Basing National Payment Limits on Median of Local Payment
Amounts.--
(1) Inexpensive and routinely purchased items; items
requiring frequent and substantial servicing.--(A) Paragraphs
(2)(C)(i)(II) and (3)(C)(i)(II) of section 1834(a) (42 U.S.C.
1395m(a)) are each amended--
(i) by striking ``1992'' the first place it appears
and inserting ``1992, 1993, and 1994''; and
(ii) by striking ``1992'' the second place it
appears and inserting ``the year''.
(B) Paragraphs (2)(C)(ii) and (3)(C)(ii) of section 1834(a)
(42 U.S.C. 1395m(a)) are each amended--
(i) by striking ``and'' at the end of subclause
(I);
(ii) by redesignating subclause (II) as (IV); and
(iii) by inserting after subclause (I) the
following new subclauses:
``(II) for 1992 and 1993, the
amount determined under this clause for
the preceding year increased by the
covered item update for such subsequent
year,
``(III) for 1994, the local payment
amount determined under clause (i) for
such item or device for that year,
except that the national limited
payment amount may not exceed 100
percent of the median of all local
payment amounts determined under such
clause for such item for that year and
may not be less than 85 percent of the
median of all local payment amounts
determined under such clause for such
item or device for that year, and''.
(2) Miscellaneous devices and items.--Section 1834(a)(8)
(42 U.S.C. 1395m(a)(8)) is amended--
(A) in subparagraph (A)(ii)(III), by striking
``1992'' and inserting ``1992, 1993, and 1994''; and
(B) in subparagraph (B)--
(i) by striking ``and'' at the end of
clause (i),
(ii) by redesignating clause (ii) as (iv),
and
(iii) by inserting after clause (i) the
following new clauses:
``(ii) for 1992 and 1993, the amount
determined under this subparagraph for the
preceding year increased by the covered item
update for such subsequent year;
``(iii) for 1994, the local purchase price
computed under subparagraph (A)(ii) for the
item for the year, except that such national
limited purchase price may not exceed 100
percent of the median of all local purchase
prices computed for the item under such
subparagraph for the year and may not be less
than 85 percent of the median of all local
purchase prices computed under such
subparagraph for the item for the year; and''.
(3) Oxygen and oxygen equipment.--Section 1834(a)(9) (42
U.S.C. 1395m(a)(9)) is amended--
(A) in subparagraph (A)(ii)(II), by striking ``1991
and 1992'' and inserting ``1991, 1992, 1993, and
1994''; and
(B) in subparagraph (B)--
(i) by striking ``and'' at the end of
clause (i),
(ii) by redesignating clause (ii) as (iv),
and
(iii) by inserting after clause (i) the
following new clauses:
``(ii) for 1992 and 1993, the amount
determined under this subparagraph for the
preceding year increased by the covered item
update for such subsequent year;
``(iii) for 1994, the local monthly payment
rate computed under subparagraph (A)(ii) for
the item for the year, except that such
national limited monthly payment rate may not
exceed 100 percent of the median of all local
monthly payment rates computed for the item
under such subparagraph for the year and may
not be less than 85 percent of the median of
all local monthly payment rates computed for
the item under such subparagraph for the year;
and''.
(b) Payment for Prosthetic Devices and Orthotics and Prosthetics.--
(1) In general.--Section 1834(h)(2) (42 U.S.C. 1395m(h)(2))
is amended--
(A) in subparagraph (A)(ii)(II), by striking ``1992
or 1993'' and inserting ``1992, 1993, or 1994'';
(B) in subparagraph (B)(ii), by striking ``each
subsequent year'' and inserting ``1993'';
(C) in subparagraph (C)(iv), by striking ``regional
purchase price computed under subparagraph (B)'' and
inserting ``national limited purchase price computed
under subparagraph (E)'';
(D) in subparagraph (D)(ii), by striking ``a
subsequent year'' and inserting ``1993''; and
(E) by adding at the end the following new
subparagraph:
``(E) Computation of national limited purchase
price.--With respect to the furnishing of a particular
item in a year, the Secretary shall compute a national
limited purchase price--
``(i) for 1994, equal to the local purchase
price computed under subparagraph (A)(ii)(II)
for the item for the year, except that such
national limited purchase price may not exceed
100 percent of the median of all local purchase
prices for the item computed under such
subparagraph for the year, and may not be less
than 85 percent of the median of all local
purchase prices for the item computed under
such subparagraph for the year; and
``(ii) for each subsequent year, equal to
the amount determined under this subparagraph
for the preceding year increased by the
applicable percentage increase for such
subsequent year.''.
(2) Exception for certain items.--Section 1834(h) (42
U.S.C. 1395m(h)), as amended by paragraph (1), is further
amended--
(A) in paragraph (1)(B), by striking ``subparagraph
(C),'' and inserting ``subparagraphs (C) and (F),'';
and
(B) by adding at the end of paragraph (2) the
following new subparagraph:
``(F) Exception for certain items.--Payment for
ostomy supplies, tracheostomy supplies, and urologicals
shall be made in accordance with subparagraphs (B) and
(C) of section 1834(a)(2).''.
(c) Effective Date.--The amendments made by this section shall
apply to items furnished on or after January 1, 1994.
SEC. 5032. PAYMENT FOR PARENTERAL AND ENTERAL NUTRIENTS, SUPPLIES, AND
EQUIPMENT DURING 1994.
In determining the amount of payment under part B of title XVIII of
the Social Security Act during 1994, the charges determined to be
reasonable with respect to parenteral and enteral nutrients, supplies,
and equipment may not exceed the charges determined to be reasonable
with respect to such nutrients, supplies, and equipment during 1993.
SEC. 5033. TREATMENT OF NEBULIZERS AND ASPIRATORS.
(a) In General.--Section 1834(a)(3)(A) (42 U.S.C. 1395m(a)(3)(A))
is amended by striking ``ventilators, aspirators, IPPB machines, and
nebulizers'' and inserting ``ventilators and IPPB machines''.
(b) Payment for Accessories Relating to Nebulizers and
Aspirators.--Section 1834(a)(2)(A) (42 U.S.C. 1395m(a)) is amended--
(1) by striking ``or'' at the end of clause (i),
(2) by adding ``or'' at the end of clause (ii), and
(3) by inserting after clause (ii) the following new
clause:
``(iii) which is an accessory used in
conjunction with a nebulizer or aspirator,''.
(c) Effective Date.--The amendments made by this section shall
apply to items furnished on or after January 1, 1994.
SEC. 5034. CERTIFICATION OF SUPPLIERS.
(a) Requirements.--
(1) In general.--Section 1834 (42 U.S.C. 1395m) is amended
by adding at the end the following new subsection:
``(i) Requirements for Suppliers of Medical Equipment and
Supplies.--
``(1) Issuance and renewal of supplier number.--
``(A) Payment.--Except as provided in subparagraph
(C), no payment may be made under this part after
October 1, 1994, for items furnished by a supplier of
medical equipment and supplies unless such supplier
obtains (and renews at such intervals as the Secretary
may require) a supplier number.
``(B) Standards for possessing a supplier number.--
A supplier may not obtain a supplier number unless--
``(i) for medical equipment and supplies
furnished on or after October 1, 1994, and
before January 1, 1996, the supplier meets
standards prescribed by the Secretary; and
``(ii) for medical equipment and supplies
furnished on or after January 1, 1996, the
supplier meets revised standards prescribed by
the Secretary (in consultation with
representatives of suppliers of medical
equipment and supplies, carriers, and
consumers) that shall include requirements that
the supplier--
``(I) comply with all applicable
State and Federal licensure and
regulatory requirements;
``(II) maintain a physical facility
on an appropriate site;
``(III) have proof of appropriate
liability insurance; and
``(IV) meet such other requirements
as the Secretary may specify.
``(C) Exception for items furnished as incident to
a physician's service.--Subparagraph (A) shall not
apply with respect to medical equipment and supplies
furnished as an incident to a physician's service.
``(D) Prohibition against multiple supplier
numbers.--The Secretary may not issue more than one
supplier number to any supplier of medical equipment
and supplies unless the issuance of more than one
number is appropriate to identify subsidiary or
regional entities under the supplier's ownership or
control.
``(E) Prohibition against delegation of supplier
determinations.--The Secretary may not delegate (other
than by contract under section 1842) the responsibility
to determine whether suppliers meet the standards
necessary to obtain a supplier number.
``(2) Certificates of medical necessity.--
``(A) Standardized certificates.--Not later than
October 1, 1994, the Secretary shall, in consultation
with carriers under this part, develop one or more
standardized certificates of medical necessity (as
defined in subparagraph (C)) for medical equipment and
supplies for which the Secretary determines that such a
certificate is necessary.
``(B) Prohibition against distribution by suppliers
of certificates of medical necessity.--
``(i) In general.--Except as provided in
clause (ii), a supplier of medical equipment
and supplies may not distribute to physicians
or to individuals entitled to benefits under
this part for commercial purposes any completed
or partially completed certificates of medical
necessity on or after October 1, 1994.
``(ii) Exception for certain billing
information.--Clause (i) shall not apply with
respect to a certificate of medical necessity
for any item that is not contained on the list
of potentially overused items developed by the
Secretary under subsection (a)(15)(A) to the
extent that such certificate contains only
information completed by the supplier of
medical equipment and supplies identifying such
supplier and the beneficiary to whom such
medical equipment and supplies are furnished, a
description of such medical equipment and
supplies, any product code identifying such
medical equipment and supplies, and any other
administrative information (other than
information relating to the beneficiary's
medical condition) identified by the Secretary.
In the event a supplier provides a certificate
of medical necessity containing information
permitted under this clause, such certificate
shall also contain the fee schedule amount and
the supplier's charge for the medical equipment
or supplies being furnished prior to
distribution of such certificate to the
physician.
``(iii) Penalty.--Any supplier of medical
equipment and supplies who knowingly and
willfully distributes a certificate of medical
necessity in violation of clause (i) is subject
to a civil money penalty in an amount not to
exceed $1,000 for each such certificate of
medical necessity so distributed. The
provisions of section 1128A (other than
subsections (a) and (b)) shall apply to civil
money penalties under this subparagraph in the
same manner as they apply to a penalty or
proceeding under section 1128A(a).
``(C) Definition.--For purposes of this paragraph,
the term `certificate of medical necessity' means a
form or other document containing information required
by the Secretary to be submitted to show that a covered
item is reasonable and necessary for the diagnosis or
treatment of illness or injury or to improve the
functioning of a malformed body member.
``(3) Coverage and review criteria.--
``(A) Development and establishment.--Not later
than January 1, 1996, the Secretary, in consultation
with representatives of suppliers of medical equipment
and supplies, individuals enrolled under this part, and
appropriate medical specialty societies, shall develop
and establish uniform national coverage and utilization
review criteria for 200 items of medical equipment and
supplies selected in accordance with the standards
described in subparagraph (B). The Secretary shall
publish the criteria as part of the instructions
provided to fiscal intermediaries and carriers under
this part and no further publication, including
publication in the Federal Register, shall be required.
``(B) Standards for selecting items subject to
criteria.--The Secretary may select an item for
coverage under the criteria developed and established
under subparagraph (A) if the Secretary finds that--
``(i) the item is frequently purchased or
rented by beneficiaries;
``(ii) the item is frequently subject to a
determination that such item is not medically
necessary; or
``(iii) the coverage or utilization
criteria applied to the item (as of the date of
the enactment of this subsection) is not
consistent among carriers.
``(C) Annual review and expansion of items subject
to criteria.--The Secretary shall annually review the
coverage and utilization of items of medical equipment
and supplies to determine whether items not included
among the items selected under subparagraph (A) should
be made subject to uniform national coverage and
utilization review criteria, and, if appropriate, shall
develop and apply such criteria to such additional
items.
``(4) Definition.--The term `medical equipment and
supplies' means--
``(A) durable medical equipment (as defined in
section 1861(n));
``(B) prosthetic devices (as described in section
1861(s)(8));
``(C) orthotics and prosthetics (as described in
section 1861(s)(9));
``(D) surgical dressings (as described in section
1861(s)(5));
``(E) such other items as the Secretary may
determine; and
``(F) for purposes of paragraphs (1) and (3)--
``(i) home dialysis supplies and equipment
(as described in section 1861(s)(2)(F)), and
``(ii) immunosuppressive drugs (as
described in section 1861(s)(2)(J)).''.
(2) Conforming amendment.--Effective October 1, 1994,
paragraph (16) of section 1834(a) (42 U.S.C. 1395m(a)) is
repealed.
(b) Report on Effect of Uniform Criteria on Utilization of Items.--
Not later than July 1, 1996, the Secretary shall submit a report to the
Committee on Ways and Means and the Committee on Energy and Commerce of
the House of Representatives and the Committee on Finance of the Senate
analyzing the impact of the uniform criteria established under section
1834(i)(3)(A) of the Social Security Act (as added by subsection (a))
on the utilization of items of medical equipment and supplies by
individuals enrolled under part B of the medicare program.
(c) Use of Covered Items by Disabled Beneficiaries.--
(1) In general.--The Secretary of Health and Human
Services, in consultation with representatives of suppliers of
durable medical equipment under part B of the medicare program
and individuals entitled to benefits under such program on the
basis of disability, shall conduct a study of the effects of
the methodology for determining payments for items of such
equipment under such part on the ability of such individuals to
obtain items of such equipment, including customized items.
(2) Report.--Not later than one year after the date of the
enactment of this Act, the Secretary shall submit a report to
Congress on the study conducted under paragraph (1), and shall
include in the report such recommendations as the Secretary
considers appropriate to assure that disabled medicare
beneficiaries have access to items of durable medical
equipment.
(d) Criteria for Treatment of Items as Prosthetics Devices or
Orthotics and Prosthetics.--Not later than one year after the date of
the enactment of this Act, the Secretary of Health and Human Services
shall submit a report to the Committees on Ways and Means and Energy
and Commerce of the House of Representatives and the Committee on
Finance of the Senate describing prosthetic devices or orthotics and
prosthetics covered under part B of the medicare program that do not
require individualized or custom fitting and adjustment to be used by a
patient. Such report shall include recommendations for an appropriate
methodology for determining the amount of payment for such items under
such program.
SEC. 5035. PROHIBITION AGAINST CARRIER FORUM SHOPPING.
(a) In General.--Section 1834(a)(12) (42 U.S.C. 1395m(a)(12)) is
amended to read as follows:
``(12) Use of carriers to process claims.--
``(A) Designation of regional carriers.--The
Secretary may designate, by regulation under section
1842, one carrier for one or more entire regions to
process all claims within the region for covered items
under this section.
``(B) Prohibition against carrier shopping.--(i) No
supplier of a covered item may present or cause to be
presented a claim for payment under this part unless
such claim is presented to the appropriate regional
carrier (as designated by the Secretary).
``(ii) For purposes of clause (i), the term
`appropriate regional carrier' means the carrier having
jurisdiction over the geographic area that includes the
permanent residence of the patient to whom the item is
furnished.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to items furnished on or after October 1, 1993.
(c) Clarification of Authority To Designate Carriers for Other
Items and Services.--Nothing in this subsection or the amendment made
by this subsection may be construed to restrict the authority of the
Secretary of Health and Human Services to designate regional carriers
or modify claims jurisdiction rules with respect to items or services
under part B of the medicare program that are not covered items under
section 1834(a) of the Social Security Act or prosthetic devices or
orthotics and prosthetics under section 1834(h) of such Act.
SEC. 5036. RESTRICTIONS ON CERTAIN MARKETING AND SALES ACTIVITIES.
(a) Prohibiting Unsolicited Telephone Contacts From Suppliers of
Durable Medical Equipment to Medicare Beneficiaries.--
(1) In general.--Section 1834(a) (42 U.S.C. 1395m(a)) is
amended by adding at the end the following new paragraph:
``(17) Prohibition against unsolicited telephone contacts
by suppliers.--
``(A) In general.--A supplier of a covered item
under this subsection may not contact an individual
enrolled under this part by telephone regarding the
furnishing of a covered item to the individual (other
than a covered item the supplier has already furnished
to the individual) unless--
``(i) the individual gives permission to
the supplier to make contact by telephone for
such purpose; or
``(ii) the supplier has furnished a covered
item under this subsection to the individual
during the 15-month period preceding the date
on which the supplier contacts the individual
for such purpose.
``(B) Prohibiting payment for items furnished
subsequent to unsolicited contacts.--If a supplier
knowingly contacts an individual in violation of
subparagraph (A), no payment may be made under this
part for any item subsequently furnished to the
individual by the supplier.
``(C) Exclusion from program for suppliers engaging
in pattern of unsolicited contacts.--If a supplier
knowingly contacts individuals in violation of
subparagraph (A) to such an extent that the supplier's
conduct establishes a pattern of contacts in violation
of such subparagraph, the Secretary shall exclude the
supplier from participation in the programs under this
Act, in accordance with the procedures set forth in
subsections (c), (f), and (g) of section 1128.''.
(2) Requiring refund of amounts collected for disallowed
items.--Section 1834(a) (42 U.S.C. 1395m(a)), as amended by
paragraph (1), is amended by adding at the end the following
new paragraph:
``(18) Refund of amounts collected for certain disallowed
items.--
``(A) In general.--If a nonparticipating supplier
furnishes to an individual enrolled under this part a
covered item for which no payment may be made under
this part by reason of paragraph (17)(B), the supplier
shall refund on a timely basis to the patient (and
shall be liable to the patient for) any amounts
collected from the patient for the item, unless--
``(i) the supplier establishes that the
supplier did not know and could not reasonably
have been expected to know that payment may not
be made for the item by reason of paragraph
(17)(B), or
``(ii) before the item was furnished, the
patient was informed that payment under this
part may not be made for that item and the
patient has agreed to pay for that item.
``(B) Sanctions.--If a supplier knowingly and
willfully fails to make refunds in violation of
subparagraph (A), the Secretary may apply sanctions
against the supplier in accordance with section
1842(j)(2).
``(C) Notice.--Each carrier with a contract in
effect under this part with respect to suppliers of
covered items shall send any notice of denial of
payment for covered items by reason of paragraph
(17)(B) and for which payment is not requested on an
assignment-related basis to the supplier and the
patient involved.
``(D) Timely basis defined.--A refund under
subparagraph (A) is considered to be on a timely basis
only if--
``(i) in the case of a supplier who does
not request reconsideration or seek appeal on a
timely basis, the refund is made within 30 days
after the date the supplier receives a denial
notice under subparagraph (C), or
``(ii) in the case in which such a
reconsideration or appeal is taken, the refund
is made within 15 days after the date the
supplier receives notice of an adverse
determination on reconsideration or appeal.''.
(b) Conforming Amendment.--Section 1834(h)(3) (42 U.S.C.
1395m(h)(3)) is amended by striking ``Paragraph (12)'' and inserting
``Paragraphs (12) and (17)''.
(c) Effective Date.--The amendments made by subsections (a) and (b)
shall apply to items furnished after the expiration of the 60-day
period that begins on the date of the enactment of this Act.
SEC. 5037. KICKBACK CLARIFICATION.
(a) In General.--Section 1128B(b)(3)(B) (42 U.S.C. 1320a-
7b(b)(3)(B)) is amended by inserting before the semicolon the
following: ``(except that in the case of a contract supply arrangement
between any entity and a supplier of medical supplies and equipment (as
defined in section 1834(i)(4), but not including items described in
subparagraph (F) of such section), such employment shall not be
considered bona fide to the extent that it includes tasks of a clerical
and cataloging nature in transmitting to suppliers assignment rights of
individuals eligible for benefits under part B of title XVIII, or
performance of warehousing or stock inventory functions)''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply with respect to services furnished on or after the first day of
the first month that begins after the expiration of the 60-day period
beginning on the date of the enactment of this Act.
SEC. 5038. BENEFICIARY LIABILITY FOR NONCOVERED SERVICES.
(a) Unassigned Claims.--
(1) In general.--Section 1834(i) (42 U.S.C. 1395m(i)), as
added by section 5034(a)(1), is amended--
(A) by redesignating paragraph (4) as paragraph
(5), and
(B) by inserting after paragraph (3) the following
new paragraph:
``(4) Limitation on patient liability.--If a supplier of
medical equipment and supplies (as defined in paragraph (5))--
``(A) furnishes an item or service to a beneficiary
for which no payment may be made by reason of paragraph
(1);
``(B) furnishes an item or service to a beneficiary
for which payment is denied in advance under subsection
(a)(15); or
``(C) furnishes an item or service to a beneficiary
for which payment is denied under section 1862(a)(1);
any expenses incurred for items and services furnished to an
individual by such a supplier not on an assigned basis shall be
the responsibility of such supplier. The individual shall have
no financial responsibility for such expenses and the supplier
shall refund on a timely basis to the individual (and shall be
liable to the individual for) any amounts collected from the
individual for such items or services. The provisions of
subsection (a)(18) shall apply to refunds required under the
previous sentence in the same manner as such provisions apply
to refunds under such subsection.''.
(2) Conforming amendment.--Section 1128B(b)(3)(B) (42
U.S.C. 1320a-7b(b)(3)(B)), as amended by section 5037(a), is
amended by striking ``1834(i)(4)'' and inserting
``1834(i)(5)''.
(b) Assigned Claims.--Section 1879 (42 U.S.C. 1395pp) is amended by
adding at the end the following new subsection:
``(h) If a supplier of medical equipment and supplies (as defined
in section 1834(i)(4))--
``(1) furnishes an item or service to a beneficiary for
which no payment may be made by reason of section 1834(i)(1);
or
``(2) furnishes an item or service to a beneficiary for
which payment is denied in advance under section 1834(a)(15);
any expenses incurred for items and services furnished to an individual
by such a supplier on an assignment-related basis shall be the
responsibility of such supplier. The individual shall have no financial
responsibility for such expenses and the supplier shall refund on a
timely basis to the individual (and shall be liable to the individual
for) any amounts collected from the individual for such items or
services. The provisions of section 1834(a)(18) shall apply to refunds
required under the previous sentence in the same manner as such
provisions apply to refunds under such section.''.
(c) Effective Date.--The amendments made by this section shall
apply to items or services furnished on or after October 1, 1994.
SEC. 5039. ADJUSTMENTS FOR INHERENT REASONABLENESS.
(a) Adjustments Made to Final Payment Amounts.--
(1) In general.--Section 1834(a)(10)(B) (42 U.S.C.
1395m(a)(10)(B)) is amended by adding at the end the following:
``In applying such provisions to payments for an item under
this subsection, the Secretary shall make adjustments to the
payment basis for the item described in paragraph (1)(B) if the
Secretary determines (in accordance with such provisions and on
the basis of prices and costs applicable at the time the item
is furnished) that such payment basis is not inherently
reasonable.''.
(2) Effective date.--The amendment made by paragraph (1)
shall take effect on the date of the enactment of this Act.
(b) Adjustment Required for Certain Items.--
(1) In general.--In accordance with section 1834(a)(10)(B)
of the Social Security Act (as amended by subsection (a)), the
Secretary of Health and Human Services shall determine whether
the payment amounts for the items described in paragraph (2)
are not inherently reasonable, and shall adjust such amounts in
accordance with such section if the amounts are not inherently
reasonable.
(2) Items described.--The items referred to in paragraph
(1) are decubitus care equipment, transcutaneous electrical
nerve stimulators, and any other items considered appropriate
by the Secretary.
SEC. 5040. PAYMENT FOR SURGICAL DRESSINGS.
(a) In General.--Section 1834 (42 U.S.C. 1395m), as amended by
section 5034(a)(1), is amended by adding at the end the following new
subsection:
``(j) Payment for Surgical Dressings.--
``(1) In general.--Payment under this subsection for
surgical dressings (described in section 1861(s)(5)) shall be
made in a lump sum amount for the purchase of the item in an
amount equal to 80 percent of the lesser of--
``(A) the actual charge for the item; or
``(B) a payment amount determined in accordance
with the methodology described in subparagraphs (B) and
(C) of subsection (a)(2) (except that in applying such
methodology, the national limited payment amount
referred to in such subparagraphs shall be initially
computed based on local payment amounts using average
reasonable charges for the 12-month period ending
December 31, 1992, increased by the covered item
updates described in such subsection for 1993 and 1994)
``(2) Exceptions.--Paragraph (1) shall not apply to
surgical dressings that are--
``(A) furnished as an incident to a physician's
professional service; or
``(B) furnished by a home health agency.''.
(b) Conforming Amendment.--Section 1833(a)(1) (42 U.S.C.
1395l(a)(1)), as amended by sections 5070(e)(2) and 5010(e)(1), is
amended--
(1) by striking ``and'' before ``(P)'', and
(2) by inserting before the semicolon at the end the
following: ``, and (Q) with respect to surgical dressings, the
amounts paid shall be the amounts determined under section
1834(j)''.
(c) Effective Date.--The amendments made by this section shall
apply to items furnished on or after January 1, 1994.
SEC. 5041. PAYMENTS FOR TENS DEVICES.
(a) In General.--Section 1834(a)(1)(D) (42 U.S.C. 1395m(a)(1)(D))
is amended by striking ``15 percent'' the second place it appears and
inserting ``45 percent''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to items furnished on or after January 1, 1994.
SEC. 5042. MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Updates to Payment Amounts.--Subparagraph (A) of section
1834(a)(14) (42 U.S.C. 1395m(a)(14)) is amended to read as follows:
``(A) for 1991 and 1992, the percentage increase in
the consumer price index for all urban consumers (U.S.
city average) for the 12-month period ending with June
of the previous year reduced by 1 percentage point;
and''.
(b) Treatment of Potentially Overused Items and Advanced
Determinations of Coverage.--(1) Effective on the date of the enactment
of this Act, section 1834(a)(15) (42 U.S.C. 1395m(a)(15)) is amended to
read as follows:
``(15) Special treatment for potentially overused items.--
``(A) Development of list of items by secretary.--
The Secretary shall develop and periodically update a
list of items for which payment may be made under this
subsection that are potentially overused, and shall
include in such list seat-lift mechanisms,
transcutaneous electrical nerve stimulators, motorized
scooters, decubitus care mattresses, and any such other
item determined by the Secretary to be potentially
overused on the basis of any of the following
criteria--
``(i) the item is marketed directly to
potential patients;
``(ii) the item is marketed with an offer
to potential patients to waive the costs of
coinsurance associated with the item or is
marketed as being available at no cost to
policyholders of a medicare supplemental policy
(as defined in section 1882(g)(1));
``(iii) the item has been subject to a
consistent pattern of overutilization; or
``(iv) a high proportion of claims for
payment for such item under this part may not
be made because of the application of section
1862(a)(1).
``(B) Items subject to special carrier scrutiny.--
Payment may not be made under this part for any item
contained in the list developed by the Secretary under
subparagraph (A) unless the carrier has subjected the
claim for payment for the item to special scrutiny or
has followed the procedures described in paragraph
(11)(C) with respect to the item.''.
(2) Effective January 1, 1994, section 1834(a)(11) (42 U.S.C.
1395m(a)) is amended by adding at the end the following new
subparagraph:
``(C) Carrier determinations for certain items in
advance.--A carrier shall determine in advance whether
payment for an item may not be made under this
subsection because of the application of section
1862(a)(1) if--
``(i) the item is a customized item (other
than inexpensive items specified by the
Secretary); or
``(ii) the item is a specified covered item
under subparagraph (B).''.
(3) Effective for standards applied for contract years beginning
after the date of the enactment of this Act, section 1842(c) (42 U.S.C.
1395u(c)), as amended by section 5013(a), is amended by adding at the
end the following new paragraph:
``(5) Each contract under this section which provides for the
disbursement of funds, as described in subsection (a)(1)(B), shall
require the carrier to meet criteria developed by the Secretary to
measure the timeliness of carrier responses to requests for payment of
items described in section 1834(a)(11)(C).''.
(4) Section 1834(h)(3) (42 U.S.C. 1395m(h)(3)) is amended by
striking ``paragraph (10) and paragraph (11)'' and inserting
``paragraphs (10) and (11)''.
(c) Study of Variations in Durable Medical Equipment Supplier
Costs.--
(1) Collection and analysis of supplier cost data.--The
Administrator of the Health Care Financing Administration
shall, in consultation with appropriate organizations, collect
data on supplier costs of durable medical equipment for which
payment may be made under part B of the medicare program, and
shall analyze such data to determine the proportions of such
costs attributable to the service and product components of
furnishing such equipment and the extent to which such
proportions vary by type of equipment and by the geographic
region in which the supplier is located.
(2) Development of geographic adjustment index; reports.--
Not later than January 1, 1995--
(A) the Administrator shall submit a report to the
Committees on Energy and Commerce and Ways and Means of
the House of Representatives and the Committee on
Finance of the Senate on the data collected and the
analysis conducted under paragraph (1), and shall
include in such report the Administrator's
recommendations for a geographic cost adjustment index
for suppliers of durable medical equipment under the
medicare program and an analysis of the impact of such
proposed index on payments under the medicare program;
and
(B) the Comptroller General shall submit a report
to the Committees on Energy and Commerce and Ways and
Means of the House of Representatives and the Committee
on Finance of the Senate analyzing on a geographic
basis the supplier costs of durable medical equipment
under the medicare program.
(d) Oxygen Retesting.--Section 1834(a)(5)(E) (42 U.S.C.
1395m(a)(5)(E)) is amended by striking ``55'' and inserting ``56''.
(e) Other Miscellaneous and Technical Amendments.--(1) Section
4152(a)(3) of OBRA-1990 is amended by striking ``amendment made by
subsection (a)'' and inserting ``amendments made by this subsection''.
(2) Section 4152(c)(2) of OBRA-1990 is amended by striking
``1395m(a)(7)(A)'' and inserting ``1395m(a)(7)''.
(3) Section 1834(a)(7)(A)(iii)(II) (42 U.S.C.
1395m(a)(7)(A)(iii)(II)) is amended by striking ``clause (v)'' and
inserting ``clause (vi)''.
(4) Section 1834(a)(7)(C)(i) (42 U.S.C. 1395m(a)(7)(C)(i)) is
amended by striking ``or paragraph (3)''.
(5) Section 1834(a)(3) (42 U.S.C. 1395m(a)(3)) is amended by
striking subparagraph (D).
(6) Section 4153(c)(1) of OBRA-1990 is amended by striking
``1834(a)'' and inserting ``1834(h)''.
(7) Section 4153(d)(2) of OBRA-1990 is amended by striking
``Reconiliation'' and inserting ``Reconciliation''.
(8)(A) Section 1834(a) (42 U.S.C. 1395m(a)) is amended by striking
paragraph (6).
(B) Section 1834(a) (42 U.S.C. 1395m(a)) is amended--
(i) in subparagraphs (A) and (B) of paragraph (1), by
striking ``(2) through (7)'' each place it appears and
inserting ``(2) through (5) and (7)'';
(ii) in paragraph (7), by striking ``(2) through (6)'' and
inserting ``(2) through (5)'';
(iii) in paragraph (8), by striking ``paragraphs (6) and
(7)'' each place it appears in the matter preceding
subparagraph (A) and in subparagraph (C) and inserting
``paragraph (7)''; and
(iv) in paragraph (8)(A)(i), by striking ``described--''
and all that follows and inserting ``described in paragraph (7)
equal to the average of the purchase prices on the claims
submitted on an assignment-related basis for the unused item
supplied during the 6-month period ending with December
1986.''.
(9) The amendments made by this subsection shall take effect as if
included in the enactment of OBRA-1990.
Subchapter D--Part B Premium
SEC. 5051. PART B PREMIUM.
Section 1839(e) (42 U.S.C. 1395r(e)) is amended--
(1) in paragraph (1)(A), by inserting ``and for each month
in 1996 and 1997'' after ``January 1991'', and
(2) in paragraph (2), by striking ``1991'' and inserting
``1998''.
Subchapter E--Other Provisions
SEC. 5061. PAYMENTS FOR CLINICAL DIAGNOSTIC LABORATORY TESTS.
(a) Lower Cap.--Section 1833(h)(4)(B) (42 U.S.C. 1395l(h)(4)(B)) is
amended--
(1) by striking ``and'' at the end of clause (iii),
(2) in clause (iv), by inserting ``and before January 1,
1994,'' after ``1990,'',
(3) by striking the period at the end of clause (iv) and
inserting ``, and'', and
(4) by adding at the end the following:
``(v) after December 31, 1993, is equal to 76 percent of
the median of all the fee schedules established for that test
for that laboratory setting under paragraph (1).''.
(b) Two Percent Update for 1994 Through 1998.--Section
1833(h)(2)(A)(ii)(III) (42 U.S.C. 1395l(h)(2)(A)(ii)(III)) is amended
by striking ``1991, 1992, and 1993'' and inserting ``1991 through
1998''.
SEC. 5062. TREATMENT OF INPATIENTS AND PROVISION OF DIAGNOSTIC AND
THERAPEUTIC X-RAY SERVICES BY RURAL HEALTH CLINICS AND
FEDERALLY QUALIFIED HEALTH CENTERS.
(a) Treatment of Inpatients.--Section 1861(aa) (42 U.S.C.
1395x(aa)) is amended--
(1) in paragraph (1), in the matter following subparagraph
(C), by striking ``as an outpatient'' and inserting ``as a
patient'';
(2) in paragraph (2)(A), by striking ``furnishing to
outpatients'' and inserting ``furnishing to patients''; and
(3) in paragraph (3), in the matter following subparagraph
(B), by striking ``as an outpatient'' and inserting ``as a
patient''.
(b) Treatment of Diagnostic and Therapeutic X-Ray Services.--
Section 1861(aa) (42 U.S.C. 1395x(aa)) is further amended--
(1) in paragraph (1)(A), by inserting ``(i)'' after ``(A)''
and by adding at the end the following: ``and (ii) diagnostic
and therapeutic x-ray services,'', and
(2) in paragraph (2)(A), by striking ``(A)'' and inserting
``(A)(i)''.
(c) Conforming Amendment.--Section 1862(a)(14) (42 U.S.C.
1395y(a)(14)) is amended by striking ``and services of a certified
registered nurse anesthetist'' and inserting ``services of a certified
registered nurse anesthetist, rural health clinic services, and
Federally-qualified health center services''.
(d) Effective Date.--The amendments made by this section shall take
effect on January 1, 1994, and shall apply to services furnished on or
after such date.
SEC. 5063. APPLICATION OF MAMMOGRAPHY CERTIFICATION REQUIREMENTS.
(a) Screening Mammography.--Section 1834(c) (42 U.S.C. 1395m(c)) is
amended--
(1) in paragraph (1)(B), by striking ``meets the quality
standards established under paragraph (3)'' and inserting ``is
conducted by a facility that has a certificate (or provisional
certificate) issued under section 354 of the Public Health
Service Act'';
(2) in paragraph (1)(C)(iii), by striking ``paragraph (4)''
and inserting ``paragraph (3)'';
(3) by striking paragraph (3); and
(4) by redesignating paragraphs (4) and (5) as paragraphs
(3) and (4).
(b) Diagnostic Mammography.--Section 1861(s)(3) (42 U.S.C.
1395x(s)(3)) is amended by inserting ``and including diagnostic
mammography if conducted by a facility that has a certificate (or
provisional certificate) issued under section 354 of the Public Health
Service Act'' after ``necessary''.
(c) Conforming Amendments.--(1) Section 1862(a)(1)(F) (42 U.S.C.
1395y(a)(1)(F)) is amended by striking ``or which does not meet the
standards established under section 1834(c)(3)'' and inserting ``or
which is not conducted by a facility described in section
1834(c)(1)(B)''.
(2) Section 1863 (42 U.S.C. 1395z) is amended by striking ``or
whether screening mammography meets the standards established under
section 1834(c)(3),''.
(3) The first sentence of section 1864(a) (42 U.S.C. 1395aa(a)) is
amended by striking ``, or whether screening mammography meets the
standards established under section 1834(c)(3)''.
(4) The third sentence of section 1865(a) (42 U.S.C. 1395bb(a)) is
amended by striking ``1834(c)(3),''.
(d) Effective Date.--The amendments made by this section shall
apply to mammography furnished by a facility on and after the first
date that the certificate requirements of section 354(b) of the Public
Health Service Act apply to such mammography conducted by such
facility.
SEC. 5064. EXTENSION OF ALZHEIMER'S DISEASE DEMONSTRATION.
Section 9342 of OBRA-1986, as amended by section 4164(a)(2) of
OBRA-1990, is amended--
(1) in subsection (c)(1), by striking ``4 years'' and
inserting ``5 years''; and
(2) in subsection (f)--
(A) by striking ``$55,000,000'' and inserting
``$60,000,000'', and
(B) by striking ``$3,000,000'' and inserting
``$5,000,000''.
SEC. 5065. ORAL CANCER DRUGS.
(a) Coverage of Certain Self-Administered Anticancer Drugs.--
Section 1861(s)(2) (42 U.S.C. 1395(s)(2)), as amended by section
5070(f)(7)(B), is amended--
(1) by striking ``and'' at the end of subparagraph (N);
(2) by adding ``and'' at the end of subparagraph (O); and
(3) by adding at the end the following new subparagraph:
``(P) an oral drug (which is approved by the Federal Food
and Drug Administration) prescribed for use as an anticancer
chemotherapeutic agent for a given indication, and containing
an active ingredient (or ingredients), which is the same
indication and active ingredient (or ingredients) as a drug
which the carrier determines would be covered pursuant to
subparagraph (A) or (B) if the drug could not be self-
administered;''.
(b) Effective Date.--The amendments made by this section shall
apply to items furnished on or after January 1, 1994.
SEC. 5066. EXTENSION OF MUNICIPAL HEALTH SERVICE DEMONSTRATION
PROJECTS.
Section 9215 of the Consolidated Omnibus Budget Reconciliation Act
of 1985, as amended by section 6135 of OBRA-1989, is amended--
(1) by striking ``December 31, 1993'' and inserting
``December 31, 1997'', and
(2) in the second sentence, by inserting after
``beneficiary costs,'' the following: ``costs to the medicaid
program and other payors, access to care, outcomes, beneficiary
satisfaction, utilization differences among the different
populations served by the projects,''.
SEC. 5067. TREATMENT OF CERTAIN INDIAN HEALTH PROGRAMS AND FACILITIES
AS FEDERALLY-QUALIFIED HEALTH CENTERS.
(a) In General.--Section 1861(aa)(4) (42 U.S.C. 1395x(aa)(4)) is
amended--
(1) by striking ``or'' at the end of subparagraph (B);
(2) by striking the period at the end of subparagraph (C)
and inserting ``; or''; and
(3) by adding at the end the following new subparagraph:
``(D) is an outpatient health program or facility operated
by a tribe or tribal organization under the Indian Self-
Determination Act or by an urban Indian organization receiving
funds under title V of the Indian Health Care Improvement
Act.''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect as if included in the enactment of section 4161(a)(2)(C) of
OBRA-1990.
SEC. 5068. INTEREST PAYMENTS.
(a) In General.--Section 1842(c)(2)(B)(ii)(IV) of the Social
Security Act shall be applied with respect to paper claims received in
the 9-month period beginning January 1, 1993, by substituting ``27
calendar days'' for ``24 calendar days'' and ``17 calendar days''.
(b) Prohibiting Payment of Interest During Mandatory Payment Delay
Period.--Section 1842(c)(2)(C) (42 U.S.C. 1395u(c)(2)(C)) is amended by
adding at the end the following: ``Notwithstanding any other provision
of law, no interest may be paid with respect to a claim pursuant to the
preceding sentence within any period following the submission of the
claim during which no payment may be issued, mailed, or otherwise
transmitted with respect to the claim.''.
SEC. 5069. CLARIFICATION OF COVERAGE OF CERTIFIED NURSE-MIDWIFE
SERVICES PERFORMED OUTSIDE THE MATERNITY CYCLE.
(a) In General.--Section 1861(gg)(2) (42 U.S.C. 1395x(gg)(2)) is
amended by striking ``, and performs services'' and all that follows
and inserting a period.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to services furnished on or after January 1, 1994.
SEC. 5069A. INCREASE IN, AND STUDY OF, ANNUAL CAP ON AMOUNT OF MEDICARE
PAYMENT FOR OUTPATIENT PHYSICAL THERAPY AND OCCUPATIONAL
THERAPY SERVICES.
(a) Increase in Annual Limitation.--Section 1833(g) (42 U.S.C.
1395l(g)) is amended by striking ``$750'' and inserting ``$900'' each
place it appears.
(b) Study.--(1) The Physician Payment Review Commission shall
conduct a study of the appropriateness of continuing an annual
limitation on the amount of payment for outpatient services of
independently practicing physical and occupational therapists under the
medicare program.
(2) By not later than January 1, 1995, the Commission shall submit
to the Committees on Energy and Commerce and Ways and Means of the
House of Representatives and the Committee on Finance of the Senate a
report on the study conducted under paragraph (1). Such report shall
include such recommendations for changes in such annual limitation as
the Commission finds appropriate.
(c) Effective Date.--The amendment made by subsection (a) shall
apply to services furnished on or after January 1, 1994.
SEC. 5070. MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Revision of Information on Part B Claims Forms.--Section
1833(q)(1) (42 U.S.C. 1395l(q)(1)) is amended--
(1) by striking ``provider number'' and inserting ``unique
physician identification number''; and
(2) by striking ``and indicate whether or not the referring
physician is an interested investor (within the meaning of
section 1877(h)(5))''.
(b) Consultation for Social Workers.--Effective with respect to
services furnished on or after January 1, 1991, section 6113(c) of
OBRA-1989 is amended--
(1) by inserting ``and clinical social worker services''
after ``psychologist services''; and
(2) by striking ``psychologist'' the second and third place
it appears and inserting ``psychologist or clinical social
worker''.
(c) Reports on Hospital Outpatient Payment.--(1) OBRA-1989 is
amended by striking section 6137.
(2) Section 1135(d) (42 U.S.C. 1320b-5(d)) is amended--
(A) by striking paragraph (6); and
(B) in paragraph (7)--
(i) by striking ``systems'' each place it appears
and inserting ``system''; and
(ii) by striking ``paragraphs (1) and (6)'' and
inserting ``paragraph (1)''.
(d) Radiology and Diagnostic Services Provided in Hospital
Outpatient Departments.-- (1) Effective as if included in the enactment
of OBRA-1989, section 1833(n)(1)(B)(i)(II) (42 U.S.C.
1395l(n)(1)(B)(i)(II)) is amended--
(A) by inserting ``and for services described in subsection
(a)(2)(E)(ii) furnished on or after January 1, 1992'' after
``1989''; and
(B) by striking ``1842(b)'' and inserting ``1842(b) (or, in
the case of services furnished on or after January 1, 1992,
under section 1848)''.
(2) Effective as if included in the enactment of OBRA-1989, section
1833(n)(1)(B)(i)(II) (42 U.S.C. 1395l(n)(1)(B)(i)(II)) is amended by
striking ``January 1,'' and inserting ``April 1,''.
(e) Payments to Nurse Practitioners in Rural Areas (Section 4155 of
OBRA-1990).--(1) Section 1861(s)(2)(K)(iii) (42 U.S.C.
1395x(s)(2)(K)(iii)) is amended--
(A) by striking ``subsection (aa)(3)'' and inserting
``subsection (aa)(5)''; and
(B) by striking ``subsection (aa)(4)'' and inserting
``subsection (aa)(6)''.
(2) Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)) is amended--
(A) by striking ``and'' before ``(N)''; and
(B) with respect to the matter inserted by section
4155(b)(2)(B) of OBRA-1990--
(i) by striking ``(M)'' and inserting ``, and
(O)'', and
(ii) by transferring and inserting it (as amended)
immediately before the semicolon at the end.
(3) Section 1833(r)(1) (42 U.S.C. 1395l(r)(1)) is amended--
(A) by striking ``ambulatory'' each place it appears and
inserting ``or ambulatory''; and
(B) by striking ``center,'' and inserting ``center''.
(4) Section 1833(r)(2)(A) (42 U.S.C. 1395l(r)(2)(A)) is amended by
striking ``subsection (a)(1)(M)'' and inserting ``subsection
(a)(1)(O)''.
(5) Section 1861(b)(4) (42 U.S.C. 1395x(b)(4)) is amended by
striking ``subsection (s)(2)(K)(i)'' and inserting ``clauses (i) or
(iii) of subsection (s)(2)(K)''.
(6) Section 1861(aa)(5) (42 U.S.C. 1395x(aa)(5)) is amended by
striking ``this Act'' and inserting ``this title''.
(7) Section 1862(a)(14) (42 U.S.C. 1395y(a)(14)) is amended by
striking ``1861(s)(2)(K)(i)'' and inserting ``1861(s)(2)(K)(i) or
1861(s)(2)(K)(iii)''.
(8) Section 1866(a)(1)(H) (42 U.S.C. 1395cc(a)(1)(H)) is amended by
striking ``1861(s)(2)(K)(i)'' and inserting ``1861(s)(2)(K)(i) or
1861(s)(2)(K)(iii)''.
(f) Other Miscellaneous and Technical Amendments.--
(1) Immediate enrollment in part b by individuals covered
by an employment-based plan.--(A) Subparagraphs (A) and (B) of
section 1837(i)(3) (42 U.S.C. 1395p(i)(3)) are each amended--
(i) by striking ``beginning with the first day of
the first month in which the individual is no longer
enrolled'' and inserting ``including each month during
any part of which the individual is enrolled''; and
(ii) by striking ``and ending seven months later''
and inserting ``ending with the last day of the eighth
consecutive month in which the individual is at no time
so enrolled''.
(B) Paragraphs (1) and (2) of section 1838(e) (42 U.S.C.
1395q(e)) are amended to read as follows:
``(1) in any month of the special enrollment period in
which the individual is at any time enrolled in a plan
(specified in subparagraph (A) or (B), as applicable, of
section 1837(i)(3)) or in the first month following such a
month, the coverage period shall begin on the first day of the
month in which the individual so enrolls (or, at the option of
the individual, on the first day of any of the following three
months), or
``(2) in any other month of the special enrollment period,
the coverage period shall begin on the first day of the month
following the month in which the individual so enrolls.''.
(C) The amendments made by subparagraphs (A) and (B) shall
take effect on the first day of the first month that begins
after the expiration of the 120-day period that begins on the
date of the enactment of this Act.
(2) Blend amounts for ambulatory surgical center
payments.--Subclauses (I) and (II) of section 1833(i)(3)(B)(ii)
(42 U.S.C. 1395l(i)(3)(B)(ii)) are each amended--
(A) by striking ``for reporting'' and inserting
``for portions of cost reporting''; and
(B) by striking ``and on or before'' and inserting
``and ending on or before''.
(3) Clinical diagnostic laboratory tests (section 4154 of
obra-1990).--Section 4154(e)(5) of OBRA-1990 is amended by
striking ``(1)(A)'' and inserting ``(1)(A),''.
(4) Separate payment under part b for certain services
(section 4157 of obra-1990).--Section 4157(a) of OBRA-1990 is
amended by striking ``(a) Services of'' and all that follows
through ``Section'' and inserting ``(a) Treatment of Services
of Certain Health Practitioners.--Section''.
(5) Community health centers and rural health clinics
(section 4161 of obra-1990).--(A) The fourth sentence of
section 1861(aa)(2) (42 U.S.C. 1395x(aa)(2)) is amended--
(i) by striking ``certification'' the first place
it appears and inserting ``approval''; and
(ii) by striking ``the Secretary's approval or
disapproval of the certification'' and inserting
``Secretary's approval or disapproval''.
(B) Section 4161(a)(7)(B) of OBRA-1990 is amended by
inserting ``and to the Committee on Finance of the Senate''
after ``Representatives''.
(6) Screening mammography (section 4163 of obra-1990).--
Section 4163 of OBRA-1990 is amended--
(A) by adding at the end of subsection (d) the
following new paragraph:
``(3) The amendment made by paragraph (2)(A)(iv) shall
apply to screening pap smears performed on or after July 1,
1990.''; and
(B) in subsection (e), by striking ``The
amendments'' and inserting ``Except as provided in
subsection (d)(3), the amendments''.
(7) Injectable drugs for treatment of osteoporosis.--
(A) Clarification of drugs covered.--The section
1861(jj) (42 U.S.C. 1395x(jj)) inserted by section
4156(a)(2) of OBRA-1990 is amended--
(i) in the matter preceding paragraph (1),
by striking ``a bone fracture related to''; and
(ii) in paragraph (1), by striking
``patient'' and inserting ``individual has
suffered a bone fracture related to post-
menopausal osteoporosis and that the
individual''.
(B) Limiting coverage to drugs provided by home
health agencies.--(i) The section 1861(jj) (42 U.S.C.
1395x(jj)) inserted by section 4156(a)(2) of OBRA-1990
is amended by striking ``if'' and inserting ``by a home
health agency if''.
(ii) Section 1861(m)(5) (42 U.S.C. 1395x(m)(5)) is
amended by striking ``but excluding'' and inserting
``and a covered osteoporosis drug (as defined in
subsection (kk), but excluding other''.
(iii) Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is
amended--
(I) by adding ``and'' at the end of
subparagraph (N), and
(II) by striking subparagraph (O) and
redesignating subparagraph (P) as subparagraph
(O).
(C) Payment based on reasonable cost.--Section
1833(a)(2) (42 U.S.C. 1395l(a)(2)) is amended--
(i) in subparagraph (A), by striking
``health services'' and inserting ``health
services (other than covered osteoporosis drug
(as defined in section 1861(kk)))'';
(ii) by striking ``and'' at the end of
subparagraph (D);
(iii) by striking the semicolon at the end
and inserting ``; and''; and
(iv) by adding at the end the following new
subparagraph:
``(F) with respect to covered osteoporosis drug (as
defined in section 1861(kk)) furnished by a home health
agency, 80 percent of the reasonable cost of such
service, as determined under section 1861(v);''.
(D) Application of part b deductible.--Section
1833(b)(2) (42 U.S.C. 1395l(b)(2)) is amended by
striking ``services'' and inserting ``services (other
than covered osteoporosis drug (as defined in section
1861(kk)))''.
(E) Covered osteoporosis drug (section 4156 of
obra-1990).--Section 1861 (42 U.S.C. 1395x) is amended,
in the subsection (jj) inserted by section 4156(a)(2)
of OBRA-1990, by striking ``(jj) The term'' and
inserting ``(kk) The term''.
(8) Other miscellaneous and technical corrections (section
4164 of obra-1990).--
(A) Ownership disclosure requirements.--(i) Section
1124A(a)(2)(A) (42 U.S.C. 1320a-3a(a)(2)(A)) is amended
by striking ``of the Social Security Act''.
(ii) Section 4164(b)(4) of OBRA-1990 is amended by
striking ``paragraph'' and inserting ``paragraphs''.
(B) Directory of unique physician identifier
numbers.--Section 4164(c) of OBRA-1990 is amended by
striking ``publish'' and inserting ``publish, and shall
periodically update,''.
(g) Effective Date.--Except as otherwise provided in this section,
the amendments made by this section shall take effect as if included in
the enactment of OBRA-1990.
CHAPTER 2--PROVISIONS RELATING TO PARTS A AND B
SEC. 5071. ELIMINATION OF ADD-ON FOR OVERHEAD OF HOSPITAL-BASED HOME
HEALTH AGENCIES.
(a) General Rule.--The first sentence of section 1861(v)(1)(L)(ii)
(42 U.S.C. 1395x(v)(1)(L)(ii)) is amended by striking ``, with
appropriate adjustment for administrative and general costs of
hospital-based agencies''.
(b) Effective Date.--The amendment made by subsection (a) applies
to cost reporting periods beginning after fiscal year 1993.
SEC. 5072. STUDY AND REPORT ON MEDICARE GME PAYMENTS.
(a) Study.--The Secretary of Health and Human Services shall
conduct a study of the methodology used to determine payments to
hospitals under the medicare program for the costs of medical residency
training programs and shall include in the study an analysis of the
causes of variation among such programs in the per resident costs of
direct graduate medical education, including the extent of support for
such programs from non-hospital sources.
(b) Report.--Not later than 1 year after the date of the enactment
of this Act, the Secretary shall submit a report to Congress on the
study conducted under subsection (a), and shall include in the report
any recommendations considered appropriate by the Secretary for
modifications to the methodology used to determine payments to
hospitals under the medicare program for the costs of medical residency
training programs that will encourage greater uniformity among medical
residency training programs in the per resident costs of direct
graduate medical education.
SEC. 5073. MEDICARE AS SECONDARY PAYER.
(a) Extension of Data Match Program.--Section 1862(b)(5)(C)(iii)
(42 U.S.C. 1395y(b)(5)(C)(iii)) is amended by striking ``1995'' and
inserting ``1998''.
(b) Permanent Application to Disabled Individuals.--Section
1862(b)(1)(B) (42 U.S.C. 1395y(b)(1)(B)) is amended by striking clause
(iii).
(c) Application of ESRD Rules to Certain Aged and Disabled
Beneficiaries and Extension of Application of 18-Month Rule.--
(1) Subparagraphs (A)(iv) and (B)(ii) of section 1862(b)(1)
(42 U.S.C. 1395y(b)(1)) are each amended--
(A) by striking ``Clause (i) shall not apply'' and
inserting ``Subparagraph (C) shall apply instead of
clause (i)'', and
(B) by inserting ``(without regard to entitlement
under section 226)'' after ``or'' the second place it
appears.
(2) The second sentence of section 1862(b)(1)(C) is amended
by striking ``on or before January 1, 1996'' and inserting
``before October 1, 1998''.
(d) Uniform Rules for Size of Employer.--
(1) In general.--Section 1862(b)(1) (42 U.S.C. 1395y(b)(1))
is amended by adding at the end the following:
``(E) General provisions.--
``(i) Exclusion of group health plan of a
small employer.--Subparagraphs (A) through (C)
do not apply to a group health plan unless the
plan is a plan of, or contributed to by, an
employer or employee organization that has 20
or more individuals in current employment
status for each working day in each of 20 or
more calendar weeks in the current calendar
year or the preceding calendar year.
``(ii) Exception for small employers in
multiemployer or multiple employer group health
plans.--Subparagraphs (A) through (C) also do
not apply with respect to individuals enrolled
in a multiemployer or multiple employer group
health plan if the coverage of the individuals
under the plan is by virtue of current
employment status with an employer that does
not have 20 or more individuals in current
employment status for each working day in each
of 20 or more calendar weeks in the current
calendar year and the preceding calendar year;
but the exception provided in this clause
applies only if the plan elects treatment under
this clause.
``(iii) Application of controlled group
rules.--For purposes of clauses (i) and (ii)--
``(I) all employees of corporations
which are members of a controlled group
of corporations (within the meaning of
section 1563(a) of the Internal Revenue
Code of 1986, determined without regard
to subsection (a)(4) or (e)(3)(C)),
shall be treated as employed by a
single employer,
``(II) all employees of trades or
businesses (whether or not
incorporated) which are under common
control (under regulations prescribed
by the Secretary of the Treasury under
section 414(c) of that Code) shall be
treated as employed by a single
employer,
``(III) all employees of the
members of an affiliated service group
(as defined in section 414(m) of that
Code) shall be treated as employed by a
single employer, and
``(IV) leased employees (as defined
in section 414(n)(2) of that Code)
shall be treated as employees of the
person for whom they perform services
to the extent they are so treated under
section 414(n) of that Code.
In applying sections of the Internal Revenue
Code of 1986 under this clause, the Secretary
shall rely upon the regulations and decisions
of the Secretary of the Treasury respecting
such sections.
``(iv) Group health plan defined.--For
purposes of this subsection, the term `group
health plan' has the meaning given such term in
section 5000(b) of the Internal Revenue Code of
1986, without regard to section 5000(d) of such
Code.
``(v) Current employment status defined.--
For purposes of this subsection, an individual
has `current employment status' with an
employer if the individual is an employee, is
the employer, or is associated with the
employer in a business relationship.
``(vi) Treatment of self-employed persons
as employers.--For purposes of this subsection,
the term `employer' includes a self-employed
person.''.
(2) Conforming amendments for working aged.--Section
1862(b)(1)(A) (42 U.S.C. 1395y(b)(1)(A)) is amended--
(A) by amending subclauses (I) and (II) of clause
(i) to read as follows:
``(I) may not take into account
that an individual (or the individual's
spouse) who is covered under the plan
by virtue of the individual's current
employment status with an employer is
entitled to benefits under this title
under section 226(a), and
``(II) shall provide that any
individual age 65 or over (and the
individual's spouse age 65 or older)
who is covered under the plan by virtue
of the individual's current employment
status with an employer shall be
entitled to the same benefits under the
plan under the same conditions as any
such individual (or spouse) under age
65.'';
(B) by striking clauses (ii), (iii), and (v), and
(C) by redesignating clause (iv) as clause (ii).
(3) Amendments for disabled individuals.--Section 1862(b)
(42 U.S.C. 1395y(b)) is amended--
(A) by amending the heading and clause (i) of
paragraph (1)(B) to read as follows:
``(B) Disabled individuals under group health
plans.--
``(i) In general.--A group health plan may
not take into account that an individual (or a
member of the individual's family) who is
covered under the plan by virtue of the
individual's current employment status with an
employer is entitled to benefits under this
title under section 226(b).'';
(B) by striking clause (iv) of paragraph (1)(B);
and
(C) in the second sentence of paragraph (2)(A), by
striking ``or large group health plan''.
(4) Amendments for individuals with esrd.--Section
1862(b)(1)(C) (42 U.S.C. 1395y(b)(1)(C)) is amended--
(A) in the matter preceding clause (i), by striking
``(as defined in subparagraph (A)(v))'',
(B) by striking ``solely'' each place it appears,
(C) by striking ``by reason of'' and inserting
``under'' each place it appears, and
(D) by inserting ``or eligible for'' after
``entitled to'' each place it appears.
(e) Secondary Payer Exemption for Members of Religious Orders.--
Effective as if included in the enactment of OBRA-1989, section
6202(e)(2) of such Act is amended by adding at the end the following:
``Such amendment also shall apply to items and services furnished
before such date with respect to secondary payer cases which the
Secretary of Health and Human Services had not identified as of such
date.''.
(f) Improving Identification of Medicare Secondary Payer
Situations.--
(1) Survey of beneficiaries.--
(A) In general.--Section 1862(b)(5) (42 U.S.C.
1395y(b)(5)) is amended by adding at the end the
following new subparagraph:
``(D) Obtaining information from beneficiaries.--
Before an individual applies for benefits under part A
or enrolls under part B, the Administrator shall mail
the individual a questionnaire to obtain information on
whether the individual is covered under a primary plan
and the nature of the coverage provided under the plan,
including the name, address, and identifying number of
the plan.''.
(B) Distribution of questionnaire by contractor.--
The Secretary of Health and Human Services shall enter
into an agreement with an entity not later than April
1, 1994, to distribute the questionnaire described in
section 1862(b)(5)(D) of the Social Security Act (as
added by subparagraph (A)).
(C) No medicare secondary payer denial based on
failure to complete questionnaire.--Section 1862(b)(2)
(42 U.S.C. 1395y(b)(2)) is amended by adding at the end
the following new subparagraph:
``(C) Treatment of questionnaires.--The Secretary
may not fail to make payment under subparagraph (A)
solely on the ground that an individual failed to
complete a questionnaire concerning the existence of a
primary plan.''.
(2) Mandatory screening by providers and suppliers under
part b.--
(A) In general.--Section 1862(b) (42 U.S.C.
1395y(b)) is amended by adding at the end the following
new paragraph:
``(6) Screening requirements for providers and suppliers.--
``(A) In general.--Notwithstanding any other
provision of this title, no payment may be made for any
item or service furnished under part B unless the
entity furnishing such item or service completes (to
the best of its knowledge and on the basis of
information obtained from the individual to whom the
item or service is furnished) the portion of the claim
form relating to the availability of other health
benefit plans.
``(B) Penalties.--An entity that knowingly,
willfully, and repeatedly fails to complete a claim
form in accordance with subparagraph (A) or provides
inaccurate information relating to the availability of
other health benefit plans on a claim form under such
subparagraph shall be subject to a civil money penalty
of not to exceed $2,000 for each such incident. The
provisions of section 1128A (other than subsections (a)
and (b)) shall apply to a civil money penalty under the
previous sentence in the same manner as such provisions
apply to a penalty or proceeding under section
1128A(a).''.
(B) Effective date.--The amendment made by
subparagraph (A) shall apply with respect to items and
services furnished on or after January 1, 1994.
(g) Improvements in Recovery of Payments From Primary Payers.--
(1) Submission of reports on efforts to recover erroneous
payments.--Section 1842(b)(3) (42 U.S.C. 1395u(b)(3)) is
amended--
(A) by striking ``and'' at the end of subparagraph
(H); and
(B) by inserting after subparagraph (H) the
following new subparagraph:
``(I) will submit annual reports to the Secretary
describing the steps taken to recover payments made under this
part for items or services for which payment has been or could
be made under a primary plan (as defined in section
1862(b)(2)(A)).''.
(2) Requirements under carrier performance evaluation
program.--Section 1842(b)(2) (42 U.S.C. 1395u(b)(2)) is amended
by adding at the end the following new subparagraph:
``(D) In addition to any other standards and criteria established
by the Secretary for evaluating carrier performance under this
paragraph relating to avoiding erroneous payments, the Secretary shall
establish standards and criteria relating to the carrier's success in
recovering payments made under this part for items or services for
which payment has been or could be made under a primary plan (as
defined in section 1862(b)(2)(A)).''.
(3) Deadline for reimbursement by primary plans.--
(A) In general.--Section 1862(b)(2)(B)(i) (42
U.S.C. 1395y(b)(2)(B)(i)) is amended by adding at the
end the following sentence: ``If reimbursement is not
made to the appropriate Trust Fund before the
expiration of the 60-day period that begins on the date
such notice or other information is received, the
Secretary may charge interest (beginning with the date
on which the notice or other information is received)
on the amount of the reimbursement until reimbursement
is made (at a rate determined by the Secretary in
accordance with regulations of the Secretary of the
Treasury applicable to charges for late payments).''.
(B) Conforming amendment.--The heading of clause
(i) of section 1862(b)(2)(B) is amended to read as
follows: ``Repayment required.--''.
(C) Effective date.--The amendments made by this
paragraph shall apply to payments for items and
services furnished on or after the date of the
enactment of this Act.
(4) Effective date.--The amendments made by paragraphs (1)
and (2) shall apply to contracts with fiscal intermediaries and
carriers under title XVIII of the Social Security Act for years
beginning with 1994.
(h) Miscellaneous and Technical Corrections.--
(1) The sentence in section 1862(b)(1)(C) added by section
4203(c)(1)(B) of OBRA-1990 is amended by striking ``clauses (i)
and (ii)'' and inserting ``this subparagraph''.
(2) Effective as if included in the enactment of OBRA-1989,
section 1862(b)(1) is amended--
(A) in subparagraphs (A)(v) and (B)(iv)(II), by
inserting ``, without regard to section 5000(d) of such
Code'' before the period at the end of each
subparagraph;
(B) in subparagraph (A)(iii), by striking ``current
calendar year or the preceding calendar year'' and
inserting ``current calendar year and the preceding
calendar year''; and
(C) in the matter in subparagraph (C) after clause
(ii), by striking ``taking into account that'' and
inserting ``paying benefits secondary to this title
when''.
(3) Section 1862(b)(5)(C)(i) (42 U.S.C. 1395y(b)(5)(C)(i))
is amended by striking ``6103(l)(12)(D)(iii)'' and inserting
``6103(l)(12)(E)(iii)''.
(4) Section 4203(c)(2) of OBRA-1990 is amended--
(A) by striking ``the application of clause (iii)''
and inserting ``the second sentence'';
(B) by striking ``on individuals'' and all that
follows through ``section 226A of such Act'';
(C) in clause (ii), by striking ``clause'' and
inserting ``sentence'';
(D) in clause (v), by adding ``and'' at the end;
and
(E) in clause (vi)--
(i) by inserting ``of such Act'' after
``1862(b)(1)(C)'', and
(ii) by striking the period at the end and
inserting the following: ``, without regard to
the number of employees covered by such
plans.''.
(5) Section 4203(d) of OBRA-1990 is amended by striking
``this subsection'' and inserting ``this section''.
(6) Except as provided in paragraph (2), the amendments
made by this subsection shall be effective as if included in
the enactment of OBRA-1990 and shall be executed before the
amendments made by subsections (a) through (d) of this section.
(i) Effective Date.--
(1) In general.--Except as otherwise provided in this
section, the amendments made by this section shall take effect
on the date of the enactment of this Act.
(2) ESRD and uniform size rules.--The amendments made by
subsections (c) and (d) apply to items and services furnished
on or after January 1, 1994.
SEC. 5074. EXTENSION OF SELF-REFERRAL BAN TO ADDITIONAL SPECIFIED
SERVICES.
(a) Extension to Designated Health Services.--
(1) In general.--Section 1877 (42 U.S.C. 1395nn) is
amended--
(A) by striking ``clinical laboratory services''
and ``clinical laboratory services'' and inserting
``designated health services'' and ``designated health
services'', respectively, each place either appears in
subsections (a)(1), (b)(2)(A)(ii), (b)(4), (d)(1), and
(d)(3); and
(B) by adding at the end the following new
subsection:
``(i) Designated Health Services Defined.--In this section, the
term `designated health services' means--
``(1) clinical laboratory services;
``(2) physical or occupational therapy services;
``(3) radiology or other diagnostic services;
``(4) radiation therapy services;
``(5) the furnishing of durable medical equipment;
``(6) the furnishing of parenteral and enteral nutrition
nutrients, supplies, and equipment;
``(7) home health services; and
``(8) home infusion therapy services.''.
(2) Conforming amendments.--Section 1877 is further
amended--
(A) in subsection (g)(1), by striking ``clinical
laboratory service'' and inserting ``designated health
service'', and
(B) in subsection (h)(7)(B), by striking ``clinical
laboratory service'' and inserting ``designated health
service''.
(b) Multiple Locations for Group Practices.--Section
1877(b)(2)(A)(ii)(II) (42 U.S.C. 1395nn(b)(2)(A)(ii)(II)) is amended by
striking ``centralized provision'' and inserting ``provision of some or
all''.
(c) Treatment of Compensation Arrangements.--
(1) Rental of office space and equipment.--Paragraph (1) of
section 1877(e) (42 U.S.C. 1395nn(e)) is amended to read as
follows:
``(1) Rental of office space; rental of equipment.--
``(A) Office space.--Payments made by a lessee to a
lessor for the use of premises if--
``(i) the lease is set out in writing,
signed by the parties, and specifies the
premises covered by the lease,
``(ii) the aggregate space rented or leased
is reasonable and necessary for the legitimate
business purposes of the lease or rental and is
used exclusively by the lessee when being used
by the lessee,
``(iii) the lease provides for a term of
rental or lease for at least one year,
``(iv) the rental charges over the term of
the lease are set in advance, are consistent
with fair market value, and are not determined
in a manner that takes into account the volume
or value of any referrals or other business
generated between the parties,
``(v) the lease would be commercially
reasonable even if no referrals were made
between the parties,
``(vi) the lease covers all of the premises
leased between the parties for the period of
the lease, and
``(vii) the compensation arrangement meets
such other requirements as the Secretary may
impose by regulation as needed to protect
against program or patient abuse.
``(B) Equipment.--Payments made by a lessee of
equipment to the lessor of the equipment for the use of
the equipment if--
``(i) the lease is set out in writing,
signed by the parties, and specifies the
equipment covered by the lease,
``(ii) the equipment rented or leased is
reasonable and necessary for the legitimate
business purposes of the lease or rental and is
used exclusively by the lessee when being used
by the lessee,
``(iii) the lease provides for a term of
rental or lease of at least one year,
``(iv) the rental charges over the term of
the lease are set in advance, are consistent
with fair market value, and are not determined
in a manner that takes into account the volume
or value of any referrals or other business
generated between the parties,
``(v) the lease would be commercially
reasonable even if no referrals were made
between the parties,
``(vi) the lease covers all of the
equipment leased between the parties for the
period of the lease, and
``(vii) the compensation arrangement meets
such other requirements as the Secretary may
impose by regulation as needed to protect
against program or patient abuse.''.
(2) Bona fide employment relationships.--Section 1877(e)(2)
(42 U.S.C. 1395nn(e)(2)) is amended--
(A) by striking ``and service'' and ``with
hospitals'';
(B) by striking ``An arrangement'' and all that
follows through ``if'' and inserting ``Any amount paid
by an employer to a physician (or immediate family
member) who has a bona fide employment relationship
with the employer for the provision of services if'';
(C) in subparagraphs (A), (B), and (D), by striking
``arrangement'' and inserting ``employment'';
(D) in subparagraph (C), by striking ``to the
hospital''; and
(E) by adding at the end the following:
``Subparagraph (B)(ii) shall not be construed as prohibiting
the payment of remuneration in the form of shares of overall
profits or in the form of a productivity bonus based on
services performed personally by the physician or member, if
the amount of the remuneration is not determined in a manner
that takes into account directly the volume or value of any
referrals by the referring physician.''.
(3) Personal service arrangements.--Section 1877(e) is
further amended by adding at the end the following new
paragraph:
``(7) Personal service arrangements.--Remuneration from an
entity under an arrangement if--
``(A) the arrangement is set out in writing, signed
by the parties, and specifies the services covered by
the arrangement,
``(B) the arrangement covers all of the services to
be provided,
``(C) the aggregate services contracted for do not
exceed those that are reasonable and necessary for the
legitimate business purposes of the arrangement,
``(D) the term of the arrangement is for at least
one year,
``(E) the compensation to be paid over the term of
the arrangement is set in advance, does not exceed fair
market value, and is not determined in a manner that
takes into account the volume or value of any referrals
or other business generated between the parties,
``(F) the services to be performed under the
arrangement do not involve the counseling or promotion
of a business arrangement of other activity that
violates any State or Federal law, and
``(G) the arrangement meets such other requirements
as the Secretary may impose by regulation as needed to
protect against program or patient abuse.''.
(4) Additional exceptions.--Section 1877(e) is further
amended by adding at the end the following new paragraphs:
``(8) Payments by a physician for items and services.--
Payments made by a physician--
``(A) to a laboratory in exchange for the provision
of clinical laboratory services, or
``(B) to an entity as compensation for other items
or services if the items or services are furnished at a
price that is consistent with fair market value.
``(9) Payments for pathology services of a group
practice.--Payments made to a group practice for pathology
services under an agreement if--
``(A) the agreement is set out in writing and
specifies the services to be provided by the parties
and the compensation for services provided under the
agreement,
``(B) the compensation paid over the term of the
agreement is consistent with fair market value and is
not determined in a manner that takes into account the
volume or value of any referrals or other business
generated between the parties,
``(C) the compensation is provided pursuant to an
agreement which would be commercially reasonable even
if no referrals were made to the entity, and
``(D) the compensation arrangement between the
parties meets such other requirements as the Secretary
may impose by regulation as needed to protect against
program or patient abuse.''.
(4) Referring physicians.--Section 1877(h)(7)(C) (42 U.S.C.
1395nn(h)(7)(C)) is amended--
(A) by inserting ``a request by a radiologist for
diagnostic radiology services, and a request by a
radiation oncologist for radiation therapy,'' after
``examination services,'', and
(B) by inserting ``, radiologist, or radiation
oncologist'' after ``pathologist'' the second place it
appears.
(d) Treatment of Group Practices.--
(1) Use of billing numbers, etc.--Section 1877 is amended--
(A) in subsection (b)(2)(B), by inserting ``under a
billing number assigned to the group practice'' after
``member'',
(B) in subsection (h)(4)(B), by inserting ``and
under a billing number assigned to the group'' after
``in the name of the group'', and
(C) in subsection (h)(4)(C), by striking ``by
members of the group''.
(2) Treatment of services under arrangements between
hospitals and group practices.--
(A) In general.--Section 1877(h)(4) (42 U.S.C.
1395nn(h)(4)) is amended--
(i) in subparagraph (B) (as amended by
paragraph (1)(B)), by inserting ``(or are
billed in the name of a hospital for which the
group provides designated health services
pursuant to an arrangement that meets the
requirements of subparagraph (B))'' after
``assigned to the group'';
(ii) by redesignating subparagraphs (A)
through (D) as clauses (i) through (iv),
respectively;
(iii) by inserting ``(A)'' after ``.--'';
and
(iv) by adding at the end the following new
subparagraph:
``(B) The requirements of this subparagraph, with respect
to an arrangement for designated health services provided by
the group and billed in the name of a hospital, are that--
``(i) with respect to services provided to an
inpatient of the hospital, the arrangement is pursuant
to the provision of inpatient hospital services under
section 1861(b)(3);
``(ii) the arrangement began before December 19,
1989, and has continued in effect without interruption
since such date;
``(iii) the group provides substantially all of the
designated health services to the hospital's patients;
``(iv) the arrangement is pursuant to an agreement
that is set out in writing and that specifies the
services to be provided by the parties and the
compensation for services provided under the agreement;
``(v) the compensation paid over the term of the
agreement is consistent with fair market value and the
compensation per unit of services is fixed in advance
and is not determined in a manner that takes into
account the volume or value of any referrals or other
business generated between the parties;
``(vi) the compensation is provided pursuant to an
agreement which would be commercially reasonable even
if no referrals were made to the entity; and
``(vii) the arrangement between the parties meets
such other requirements as the Secretary may impose by
regulation as needed to protect against program or
patient abuse.''.
(B) Conforming amendment.--Section 1877(b)(2)(B)
(42 U.S.C. 1395nn(b)(2)(B)) is amended by inserting
``(or by a hospital for which such a group practice
provides designated health services pursuant to an
arrangement that meets the requirements of subsection
(h)(4)(B))'' before ``, or by an entity''.
(3) Treatment of certain faculty practice plans.--The last
sentence of section 1877(h)(4)(A) (42 U.S.C. 1395nn(h)(4)(A)),
as redesignated by paragraph (2)(A), is amended by inserting
``, institution of higher education, or medical school'' after
``hospital''.
(e) Expanding Rural Provider Exception To Cover Compensation
Arrangements.--
(1) In general.--Section 1877(b) (42 U.S.C. 1395nn(b)) is
amended--
(A) by redesignating paragraph (5) as paragraph
(7), and
(B) by inserting after paragraph (4) the following
new paragraph:
``(5) Rural providers.--In the case of designated services
if--
``(A) the entity furnishing the services is in a
rural area (as defined in section 1886(d)(2)(D)), and
``(B) substantially all of the services furnished
by the entity to individuals entitled to benefits under
this title are furnished to such individuals who reside
in such a rural area.''.
(2) Conforming amendments.--Section 1877(d) (42 U.S.C.
1395nn(d)) is amended--
(A) by striking paragraph (2), and
(B) by redesignating paragraph (3) as paragraph
(2).
(f) Exception for Shared Facility Laboratory Services.--
(1) In general.--Section 1877 is amended--
(A) in subsection (b), as amended by subsection
(e)(1), by inserting after paragraph (5) the following
new paragraph:
``(6) Shared facility laboratory services.--
``(A) In general.--In the case of shared facility
laboratory services of a shared facility--
``(i) that are furnished--
``(I) personally by the referring
physician who is a shared facility
physician or personally by an
individual supervised by such a
physician or by another shared facility
physician and employed under the shared
facility arrangement,
``(II) by a shared facility in a
building in which the referring
physician furnishes physician's
services unrelated to the furnishing of
shared facility laboratory services,
and
``(III) to a patient of a shared
facility physician; and
``(ii) that are billed by the referring
physician or by an entity that is wholly owned
by such physician.
``(B) Limitation.--The exception under this
paragraph shall only apply to a shared facility only if
the facility and the shared facility arrangement were
established as of June 26, 1992.''; and
(B) in subsection (h), by adding at the end the
following new paragraph:
``(8) Shared facility related definitions.--
``(A) Shared facility laboratory services.--The
term `shared facility laboratory services' means, with
respect to a shared facility, clinical laboratory
services furnished by the facility to patients of
shared facility physicians.
``(B) Shared facility.--The term `shared facility'
means an entity that furnishes shared facility
laboratory services under a shared facility
arrangement.
``(C) Shared facility physician.--The term `shared
facility physician' means, with respect to a shared
facility, a physician who has a financial relationship
under a shared facility arrangement with the facility.
``(D) Shared facility arrangement.--The term
`shared facility arrangement' means, with respect to
the provision of shared facility laboratory services in
a building, a financial arrangement--
``(i) which is only between physicians who
are providing services (unrelated to shared
facility laboratory services) in the same
building,
``(ii) in which the overhead expenses of
the facility are shared, in accordance with
methods previously determined by the physicians
in the arrangement, among the physicians in the
arrangement, and
``(iii) which, in the case of a
corporation, is wholly owned and controlled by
shared facility physicians.''.
(2) GAO study of shared facility arrangements.--
(A) In general.--The Comptroller General shall
analyze the effect on the utilization of health
services of shared facility arrangements for which an
exception is provided under the amendments made by
paragraph (1). The analysis shall include a review of
the effect of the limitation, described in section
1877(b)(6)(B) of the Social Security Act (as added by
paragraph (1)), with respect to such exception and on
the availability of services (including hematology
services).
(B) Report.--Not later than January 1, 1995, the
Comptroller General shall submit a report to Congress
on the analysis conducted under subparagraph (A). The
report shall include recommendations with respect to
changing the limitation.
(g) Exemption of Compensation Arrangements Involving Certain Types
of Remuneration.--Section 1877(h)(1) (42 U.S.C. 1395nn(h)(1)) is
amended--
(1) by striking subparagraph (B);
(2) in subparagraph (A), by inserting before the period the
following: ``(other than an arrangement involving only
remuneration described in subparagraph (B))''; and
(3) by adding at the end the following new subparagraph:
``(B) Remuneration described in this subparagraph is any
remuneration consisting of any of the following:
``(i) The forgiveness of amounts owed for
inaccurate tests or procedures, mistakenly performed
tests or procedures, or the correction of minor billing
errors.
``(ii) The provision of items, devices, or supplies
that are used solely to--
``(I) collect, transport, process, or store
specimens for the entity providing the item,
device, or supply, or
``(II) communicate the results of tests or
procedures for such entity.''.
(h) Exception for Publicly-Traded Securities.--Section 1877(c)(2)
(42 U.S.C. 1395nn(d)(2)) is amended by striking ``total assets
exceeding $100,000,000'' and inserting ``stockholder equity exceeding
$75,000,000''.
(i) Miscellaneous and Technical Corrections.--Section 1877 (42
U.S.C. 1395nn) is amended--
(1) in subsection (b)(2)(A)(i), in subparagraph (A)(i), by
striking ``who are employed by such physician or group practice
and who are personally'' and inserting ``who are directly'';
(2) in the fourth sentence of subsection (f)--
(A) by striking ``provided'' and inserting
``furnished'', and
(B) by striking ``provides'' and inserting
``furnish'';
(3) in the fifth sentence of subsection (f)--
(A) by striking ``providing'' each place it appears
and inserting ``furnishing'',
(B) by striking ``with respect to the providers''
and inserting ``with respect to the entities'', and
(C) by striking ``diagnostic imaging services of
any type'' and inserting ``magnetic resonance imaging,
computerized axial tomography scans, and ultrasound
services''; and
(4) in subsection (a)(2)(B), by striking ``subsection
(h)(1)(A)'' and inserting ``subsection (h)(1)''.
(j) Effective Dates.--
(1) The amendments made by subsection (a) apply with
respect to a referral by a physician for designated health
services (as described in section 1877(i) of the Social
Security Act) made after December 31, 1994.
(2) The amendments made by this section (other than
subsection (a)) shall apply to referrals made on or after
January 1, 1992.
SEC. 5075. REDUCTION IN PAYMENT FOR ERYTHROPOIETIN.
(a) In General.--Section 1881(b)(11)(B)(ii)(I) (42 U.S.C.
1395rr(b)(11)(B)(ii)(I)) is amended--
(1) by striking ``1991'' and inserting ``1994'', and
(2) by striking ``$11'' and inserting ``$10''.
(b) Effective Date.--The amendments made by subsection (a) apply to
erythropoietin furnished after 1993.
SEC. 5076. MEDICARE HOSPITAL AGREEMENTS WITH ORGAN PROCUREMENT
ORGANIZATIONS.
(a) In General.--Section 1138(a)(1) (42 U.S.C. 1320b-8(a)(1)) is
amended--
(1) by striking ``and'' at the end of subparagraph (A),
(2) by striking the period at the end of subparagraph (B)
and inserting ``; and'', and
(3) by adding at the end the following new subparagraph:
``(C) in the case of a hospital or rural primary care
hospital that has in effect an agreement (described in section
371(b)(3)(A) of the Public Health Service Act) with an organ
procurement organization, the agreement is with such
organization for the service area in which the hospital is
located (as established under such section).''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to hospitals participating in the programs under titles XVIII and
XIX of the Social Security Act as of January 1, 1994.
SEC. 5077. EXTENSION OF WAIVER FOR WATTS HEALTH FOUNDATION.
Section 9312(c)(3)(D) of OBRA-1986, as added by section 4018(d) of
OBRA-1987 and as amended by section 6212(a)(1) of OBRA-1989, is amended
by striking ``1994'' and inserting ``1996''.
SEC. 5078. IMPROVED OUTREACH FOR QUALIFIED MEDICARE BENEFICIARIES.
The Secretary of Health and Human Services shall establish and
implement a method for obtaining information from newly eligible
medicare beneficiaries that may be used to determine whether such
beneficiaries may be eligible for medical assistance for medicare cost-
sharing under State medicaid plans as qualified medicare beneficiaries,
and for transmitting such information to the State in which such a
beneficiary resides.
SEC. 5079. SOCIAL HEALTH MAINTENANCE ORGANIZATIONS.
(a) Extension of Current Waivers.--Section 4018(b) of OBRA-1987, as
amended by section 4207(b)(4) of OBRA-1990, is amended--
(1) in paragraph (1) by striking ``December 31, 1995'' and
inserting ``December 31, 1997''; and
(2) in paragraph (4) by striking ``March 31, 1996'' and
inserting ``March 31, 1998''.
(b) Expansion of Demonstrations.--Section 2355 of the Deficit
Reduction Act of 1984, as amended by section 4207(b)(4)(B) of OBRA-
1990, is amended--
(1) in the last sentence of subsection (a) by striking ``12
months'' and inserting ``36 months''; and
(2) in subsection (b)(1)(B)--
(A) by striking ``or'' at the end of clause (iii),
and
(B) by redesignating clause (iv) as clause (v) and
inserting after clause (iii) the following new clause:
``(iv) integrating acute and chronic care
management for patients with end-stage renal
disease through expanded community care case
management services (and for purposes of a
demonstration project conducted under this
clause, any requirement under a waiver granted
under this section that a project disenroll
individuals who develop end-stage renal disease
shall not apply); or''.
(c) Expansion of Number of Members Per Site.--The Secretary of
Health and Human Services may not impose a limit of less than 12,000 on
the number of individuals that may participate in a project conducted
under section 2355 of the Deficit Reduction Act of 1984.
(d) Miscellaneous and Technical Corrections.--
(1) The section following section 4206 of OBRA-1990 is
amended by striking ``Sec. 4027.'' and inserting ``Sec.
4207.'', and in this subtitle is referred to as section 4207 of
OBRA-1990.
(2) Section 2355(b)(1)(B) of the Deficit Reduction Act of
1984, as amended by section 4207(b)(4)(B)(ii) of OBRA-1990, is
amended--
(A) by striking ``12907(c)(4)(A)'' and inserting
``4207(b)(4)(B)(i)'', and
(B) by striking ``feasibilitly'' and inserting
``feasibility''.
(3) Section 4207(b)(4)(B)(iii)(III) of OBRA-1990 is amended
by striking the period at the end and inserting a semicolon.
(4) Subsections (c)(3) and (e) of section 2355 of the
Deficit Reduction Act of 1984, as amended by section
4207(b)(4)(B) of OBRA-1990, are each amended by striking
``12907(c)(4)(A)'' each place it appears and inserting
``4207(b)(4)(B)''.
(5) Section 4207(c)(2) of OBRA-1990 is amended by striking
``the Committee on Ways and Means'' each place it appears and
inserting ``the Committees on Ways and Means and Energy and
Commerce''.
(6) Section 4207(d) of OBRA-1990 is amended by
redesignating the second paragraph (3) (relating to effective
date) as paragraph (4).
(7) Section 4207(i)(2) of OBRA-1990 is amended--
(A) by striking the period at the end of clause
(iii) and inserting a semicolon, and
(B) in clause (v), by striking ``residents'' and
inserting ``patients''.
(8) Section 4207(j) of OBRA-1990 is amended by striking
``title'' each place it appears and inserting ``subtitle''.
(e) Effective Date.--The amendments made by this section shall take
effect as if included in the enactment of OBRA-1990.
SEC. 5080. PEER REVIEW ORGANIZATIONS.
(a) Repeal of PRO Precertification Requirement for Certain Surgical
Procedures.--
(1) In general.--Section 1164 (42 U.S.C. 1320c-13) is
repealed.
(2) Conforming amendments.--
(A) Section 1154 (42 U.S.C. 1320c-3) is amended--
(i) in subsection (a), by striking
paragraph (12), and
(ii) in subsection (d), by striking ``(and
except as provided in section 1164)''.
(B) Section 1833 (42 U.S.C. 1395l) is amended--
(i) in subsection (a)(1)(D)(i), by striking
``, or for tests furnished in connection with
obtaining a second opinion required under
section 1164(c)(2) (or a third opinion, if the
second opinion was in disagreement with the
first opinion)'';
(ii) in subsection (a)(1), by striking
clause (G);
(iii) in subsection (a)(2)(A), by striking
``to items and services (other than clinical
diagnostic laboratory tests) furnished in
connection with obtaining a second opinion
required under section 1164(c)(2) (or a third
opinion, if the second opinion was in
disagreement with the first opinion),'';
(iv) in subsection (a)(2)(D)(i)--
(I) by striking ``related basis,''
and inserting ``related basis or'', and
(II) by striking ``, or for tests
furnished in connection with obtaining
a second opinion required under section
1164(c)(2) (or a third opinion, if the
second opinion was in disagreement with
the first opinion)'';
(v) in subsection (a)(3), by striking ``and
for items and services furnished in connection
with obtaining a second opinion required under
section 1164(c)(2), or a third opinion, if the
second opinion was in disagreement with the
first opinion)''; and
(vi) in the first sentence of subsection
(b), by striking ``(4)'' and all that follows
through ``and (5)'' and inserting ``and (4)''.
(C) Section 1834(g)(1)(B) (42 U.S.C.
1395m(g)(1)(B)) is amended by striking ``and for items
and services furnished in connection with obtaining a
second opinion required under section 1164(c)(2), or a
third opinion, if the second opinion was in
disagreement with the first opinion)''.
(D) Section 1862(a) (42 U.S.C. 1395y(a)) is
amended--
(i) by adding ``or'' at the end of
paragraph (14),
(ii) by striking ``; or'' at the end of
paragraph (15) and inserting a period, and
(iii) by striking paragraph (16).
(E) The third sentence of section 1866(a)(2)(A) (42
U.S.C. 1395w(a)(2)(A)) is amended by striking ``, with
respect to items and services furnished in connection
with obtaining a second opinion required under section
1164(c)(2) (or a third opinion, if the second opinion
was in disagreement with the first opinion),''.
(3) Effective date.--The amendments made by this subsection
shall apply to services provided on or after the date of the
enactment of this Act.
(b) Miscellaneous and Technical Corrections.--(1) The third
sentence of section 1156(b)(1) (42 U.S.C. 1320c-5(b)(1)) is amended by
striking ``whehter'' and inserting ``whether''.
(2)(A) Subparagraph (B) of section 1154(a)(9) (42 U.S.C. 1320c-
3(a)(9)) is amended to read as follows:
``(B) If the organization finds, after reasonable notice
and opportunity for discussion with the physician or
practitioner concerned, that the physician or practitioner has
furnished services in violation of section 1156(a), the
organization shall notify the State board or boards responsible
for the licensing or disciplining of the physician or
practitioner of its finding and of any action taken as a result
of the finding.''.
(B) Subparagraph (D) of section 1160(b)(1) (42 U.S.C. 1320c-
9(b)(1)) is amended to read as follows:
``(D) to provide notice in accordance with section
1154(a)(9)(B);''.
(3) Section 4205(d)(2)(B) of OBRA-1990 is amended by striking
``amendments'' and inserting ``amendment''.
(4) Section 1160(d) (42 U.S.C. 1320c-9(d)) is amended by striking
``subpena'' and inserting ``subpoena''.
(5) Section 4205(e)(2) of OBRA-1990 is amended by striking
``amendments'' and inserting ``amendment'' and by striking ``all''.
(6)(A) Except as provided in subparagraph (B), the amendments made
by this subsection shall take effect as if included in the enactment of
OBRA-1990.
(B) The amendments made by paragraph (2) (relating to the
requirement on reporting of information to State boards) shall take
effect on the date of the enactment of this Act.
SEC. 5081. HOSPICE INFORMATION TO HOME HEALTH BENEFICIARIES.
(a) In General.--Section 1891(a)(1) (42 U.S.C. 1395bbb(a)(1)) is
amended by adding at the end the following new subparagraph:
``(H) The right, in the case of a resident who is
entitled to benefits under this title, to be fully
informed orally and in writing (at the time of coming
under the care of the agency) of the entitlement of
individuals to hospice care under section 1812(a)(4)
(unless there is no hospice program providing hospice
care for which payment may be made under this title
within the geographic area of the facility and it is
not the common practice of the agency to refer patients
to hospice programs located outside such geographic
area).''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to services furnished on or after the first day of the first
month beginning more than one year after the date of the enactment of
this Act.
SEC. 5082. HEALTH MAINTENANCE ORGANIZATIONS.
(a) Adjustment In Medicare Capitation Payments To Account For
Regional Variations In Application of Secondary Payer Provisions.--
(1) In general.--Section 1876(a)(4) (42 U.S.C.
1395mm(a)(4)) is amended by adding at the end the following new
sentence: ``In establishing the adjusted average per capita
cost for a geographic area, the Secretary shall take into
account the differences between the proportion of individuals
in the area with respect to whom there is a group health plan
that is a primary plan (within the meaning of section
1862(b)(2)(A)) compared to the proportion of all such
individuals with respect to whom there is such a group health
plan.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to contracts entered into for years beginning with
1994.
(b) Revisions in the Payment Methodology for Risk Contractors.--
Section 4204(b) of OBRA-1990 is amended to read as follows:
``(b) Revisions in the Payment Methodology for Risk Contractors.--
(1)(A) Not later than January 1, 1995, the Secretary of Health and
Human Services (in this subsection referred to as the ``Secretary'')
shall submit a proposal to the Congress that provides for revisions to
the payment method to be applied in years beginning with 1996 for
organizations with a risk-sharing contract under section 1876(g) of the
Social Security Act.
``(B) In proposing the revisions required under subparagraph (A)
the Secretary shall consider--
``(i) the difference in costs associated with medicare
beneficiaries with differing health status and demographic
characteristics; and
``(ii) the effects of using alternative geographic
classifications on the determinations of costs associated with
beneficiaries residing in different areas.
``(2) Not later than 3 months after the date of submittal of the
proposal made pursuant to paragraph (1), the Comptroller General shall
review the proposal and shall report to Congress on the appropriateness
of the proposed modifications.''.
(c) Miscellaneous and Technical Corrections.--(1) Section
1876(a)(3) (42 U.S.C. 1395mm(a)(3)) is amended by striking ``subsection
(c)(7)'' and inserting ``subsections (c)(2)(B)(ii) and (c)(7)''.
(2) Section 4204(c)(3) of OBRA-1990 is amended by striking ``for
1991'' and inserting ``for years beginning with 1991''.
(3) Section 4204(d)(2) of OBRA-1990 is amended by striking
``amendment'' and inserting ``amendments''.
(4) Section 1876(a)(1)(E)(ii)(I) (42 U.S.C. 1395mm(a)(1)(E)(ii)(I))
is amended by striking the comma after ``contributed to''.
(5) Section 4204(e)(2) of OBRA-1990 is amended by striking ``(which
has a risk-sharing contract under section 1876 of the Social Security
Act)''.
(6) Section 4204(f)(4) of OBRA-1990 is amended by striking
``final''.
(7) Section 1862(b)(3)(C) (42 U.S.C. 1395y(b)(3)(C)) is amended--
(A) in the heading, by striking ``plan'' and inserting
``plan or a large group health plan'';
(B) by striking ``group health plan'' and inserting ``group
health plan or a large group health plan'';
(C) by striking ``, unless such incentive is also offered
to all individuals who are eligible for coverage under the
plan''; and
(D) by striking ``the first sentence of subsection (a) and
other than subsection (b)'' and inserting ``subsections (a) and
(b)''.
(8) The amendments made by this subsection shall take effect as if
included in the enactment of OBRA-1990.
SEC. 5083. MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Survey and Certification Requirements.--(1) Section 1864 (42
U.S.C. 1395aa) is amended--
(A) in subsection (e), by striking ``title'' and inserting
``title (other than any fee relating to section 353 of the
Public Health Service Act)''; and
(B) in the first sentence of subsection (a), by striking
``1861(s) or'' and all that follows through ``Service Act,''
and inserting ``1861(s),''.
(2) An agreement made by the Secretary of Health and Human Services
with a State under section 1864(a) of the Social Security Act may
include an agreement that the services of the State health agency or
other appropriate State agency (or the appropriate local agencies) will
be utilized by the Secretary for the purpose of determining whether a
laboratory meets the requirements of section 353 of the Public Health
Service Act.
(b) Other Miscellaneous and Technical Provisions.--(1) Section 1833
(42 U.S.C. 1395l) is amended by redesignating the subsection (r) added
by section 4206(b)(2) of OBRA-1990 as subsection (s).
(2) Section 1866(f)(1) (42 U.S.C. 1395cc(f)(1)) is amended by
striking ``1833(r)'' and inserting ``1833(s)''.
(3) Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is amended by moving
subparagraph (O), as redesignated by section 5070(f)(7)(B)(iii)(II) of
this subtitle, two ems to the left.
(4) Section 1881(b)(1)(C) (42 U.S.C. 1395rr(b)(1)(C)) is amended by
striking ``1861(s)(2)(Q)'' and inserting ``1861(s)(2)(P)''.
(5) Section 4201(d)(2) of OBRA-1990 is amended by striking ``(B) by
striking'', ``(C) by striking'', and ``(3) by adding'' and inserting
``(i) by striking'', ``(ii) by striking'', and ``(B) by adding'',
respectively.
(6)(A) Section 4207(a)(1) of OBRA-1990 is amended by adding closing
quotation marks and a period after ``such review.''.
(B) Section 4207(a)(4) of OBRA-1990 is amended by striking ``this
subsection'' and inserting ``paragraphs (2) and (3)''.
(C) Section 4207(b)(1) of OBRA-1990 is amended by striking
``section 3(7)'' and inserting ``section 601(a)(1)''.
(7) Section 4202 of OBRA-1990 is amended--
(A) in subsection (b)(1)(A), by striking ``home
hemodialysis staff assistant'' and inserting ``qualified home
hemodialysis staff assistant (as described in subsection
(d))'';
(B) in subsection (b)(2)(B)(ii)(I), by striking ``(as
adjusted to reflect differences in area wage levels)'';
(C) in subsection (c)(1)(A), by striking ``skilled''; and
(D) in subsection (c)(1)(E), by striking ``(b)(4)'' and
inserting ``(b)(2)''.
(c) Effective Date.--The amendments made by this section shall take
effect as if included in the enactment of OBRA-1990.
CHAPTER 3--PROVISIONS RELATING TO MEDICARE SUPPLEMENTAL INSURANCE
POLICIES
SEC. 5091. STANDARDS FOR MEDICARE SUPPLEMENTAL INSURANCE POLICIES.
(a) Simplification of Medicare Supplemental Policies.--
(1) Section 4351 of OBRA-1990 is amended by striking ``(a)
In General.--''.
(2) Section 1882(p) (42 U.S.C. 1395ss(p)) is amended--
(A) in paragraph (1)(A)--
(i) by striking ``promulgates'' and
inserting ``changes the revised NAIC Model
Regulation (described in subsection (m)) to
incorporate'',
(ii) by striking ``(such limitations,
language, definitions, format, and standards
referred to collectively in this subsection as
`NAIC standards'),'', and
(iii) by striking ``included a reference to
the NAIC standards'' and inserting ``were a
reference to the revised NAIC Model Regulation
as changed under this subparagraph (such
changed regulation referred to in this section
as the `1991 NAIC Model Regulation')'';
(B) in paragraph (1)(B)--
(i) by striking ``promulgate NAIC
standards'' and inserting ``make the changes in
the revised NAIC Model Regulation'',
(ii) by striking ``limitations, language,
definitions, format, and standards described in
clauses (i) through (iv) of such subparagraph
(in this subsection referred to collectively as
`Federal standards')'' and inserting ``a
regulation'', and
(iii) by striking ``included a reference to
the Federal standards'' and inserting ``were a
reference to the revised NAIC Model Regulation
as changed by the Secretary under this
subparagraph (such changed regulation referred
to in this section as the `1991 Federal
Regulation')'';
(C) in paragraph (1)(C)(i), by striking ``NAIC
standards or the Federal standards'' and inserting
``1991 NAIC Model Regulation or 1991 Federal
Regulation'';
(D) in paragraphs (1)(C)(ii)(I), (1)(E), (2), and
(9)(B), by striking ``NAIC or Federal standards'' and
inserting ``1991 NAIC Model Regulation or 1991 Federal
Regulation'';
(E) in paragraph (2)(C), by striking ``(5)(B)'' and
inserting ``(4)(B)'';
(F) in paragraph (4)(A)(i), by inserting ``or
paragraph (6)'' after ``(B)'';
(G) in paragraph (4), by striking ``applicable
standards'' each place it appears and inserting
``applicable 1991 NAIC Model Regulation or 1991 Federal
Regulation'';
(H) in paragraph (6), by striking ``in regard to
the limitation of benefits described in paragraph (4)''
and inserting ``described in clauses (i) through (iii)
of paragraph (1)(A)'';
(I) in paragraph (7), by striking ``policyholder''
and inserting ``policyholders'';
(J) in paragraph (8), by striking ``after the
effective date of the NAIC or Federal standards with
respect to the policy, in violation of the previous
requirements of this subsection'' and inserting ``on
and after the effective date specified in paragraph
(1)(C) (but subject to paragraph (10)), in violation of
the applicable 1991 NAIC Model Regulation or 1991
Federal Regulation insofar as such regulation relates
to the requirements of subsection (o) or (q) or clause
(i), (ii), or (iii) of paragraph (1)(A)'';
(K) in paragraph (9), by adding at the end the
following new subparagraph:
``(D) Subject to paragraph (10), this paragraph shall apply to
sales of policies occurring on or after the effective date specified in
paragraph (1)(C).''; and
(L) in paragraph (10), by striking ``this
subsection'' and inserting ``paragraph (1)(A)(i)''.
(b) Guaranteed Renewability.--Section 1882(q) (42 U.S.C. 1395ss(q))
is amended--
(1) in paragraph (2), by striking ``paragraph (2)'' and
inserting ``paragraph (4)'', and
(2) in paragraph (4), by striking ``the succeeding issuer''
and inserting ``issuer of the replacement policy''.
(c) Enforcement of Standards.--
(1) Section 1882(a)(2) (42 U.S.C. 1395ss(a)(2)) is
amended--
(A) in subparagraph (A), by striking ``NAIC
standards or the Federal standards'' and inserting
``1991 NAIC Model Regulation or 1991 Federal
Regulation'', and
(B) by striking ``after the effective date of the
NAIC or Federal standards with respect to the policy''
and inserting ``on and after the effective date
specified in subsection (p)(1)(C)''.
(2) The sentence in section 1882(b)(1) added by section
4353(c)(5) of OBRA-1990 is amended--
(A) by striking ``The report'' and inserting ``Each
report'',
(B) by inserting ``and requirements'' after
``standards'',
(C) by striking ``and'' after ``compliance,'', and
(D) by striking the comma after ``Commissioners''.
(3) Section 1882(g)(2)(B) (42 U.S.C. 1395ss(g)(2)(B)) is
amended by striking ``Panel'' and inserting ``Secretary''.
(4) Section 1882(b)(1) (42 U.S.C. 1395ss(b)(1)) is amended
by striking ``the the Secretary'' and inserting ``the
Secretary''.
(d) Preventing Duplication.--
(1) Section 1882(d)(3)(A) (42 U.S.C. 1395ss(d)(3)(A)) is
amended--
(A) by amending the first sentence to read as
follows:
``(i) It is unlawful for a person to sell or issue to an individual
entitled to benefits under part A or enrolled under part B of this
title--
``(I) a health insurance policy with knowledge that the
policy duplicates health benefits to which the individual is
otherwise entitled under this title or title XIX,
``(II) a medicare supplemental policy with knowledge that
the individual is entitled to benefits under another medicare
supplemental policy, or
``(III) a health insurance policy (other than a medicare
supplemental policy) with knowledge that the policy duplicates
health benefits to which the individual is otherwise entitled,
other than benefits to which the individual is entitled under a
requirement of State or Federal law.'';
(B) by designating the second sentence as clause
(ii) and, in such clause, by striking ``the previous
sentence'' and inserting ``clause (i)'';
(C) by designating the third sentence as clause
(iii) and, in such clause--
(i) by striking ``the previous sentence''
and inserting ``clause (i) with respect to the
sale of a medicare supplemental policy'', and
(ii) by striking ``and the statement'' and
all that follows up to the period at the end;
and
(D) by striking the last sentence.
(2) Section 1882(d)(3)(B) (42 U.S.C. 1395ss(d)(3)(B)) is
amended--
(A) in clause (ii)(II), by striking ``65 years of
age or older'',
(B) in clause (iii)(I), by striking ``another
medicare'' and inserting ``a medicare'',
(C) in clause (iii)(I), by striking ``such a
policy'' and inserting ``a medicare supplemental
policy'',
(D) in clause (iii)(II), by striking ``another
policy'' and inserting ``a medicare supplemental
policy'', and
(E) by amending subclause (III) of clause (iii) to
read as follows:
``(III) If the statement required by clause (i) is obtained and
indicates that the individual is entitled to any medical assistance
under title XIX, the sale of the policy is not in violation of clause
(i) (insofar as such clause relates to such medical assistance), if a
State medicaid plan under such title pays the premiums for the policy,
or, in the case of a qualified medicare beneficiary described in
section 1905(p)(1), if the State pays less than the full amount of
medicare cost-sharing as described in subparagraphs (B), (C), and (D)
of section 1905(p)(3) for such individual.''.
(3)(A) Section 1882(d)(3)(C) (42 U.S.C. 1395ss(d)(3)(C)) is
amended--
(i) by striking ``the selling'' and inserting ``(i)
the sale or issuance'', and
(ii) by inserting before the period at the end the
following: ``, (ii) the sale or issuance of a policy or
plan described in subparagraph (A)(i)(I) (other than a
medicare supplemental policy to an individual entitled
to any medical assistance under title XIX) under which
all the benefits are fully payable directly to or on
behalf of the individual without regard to other health
benefit coverage of the individual but only if (for
policies sold or issued more than 60 days after the
date the statements are published or promulgated under
subparagraph (D)) there is disclosed in a prominent
manner as part of (or together with) the application
the applicable statement (specified under subparagraph
(D)) of the extent to which benefits payable under the
policy or plan duplicate benefits under this title, or
(iii) the sale or issuance of a policy or plan
described in subparagraph (A)(i)(III) under which all
the benefits are fully payable directly to or on behalf
of the individual without regard to other health
benefit coverage of the individual''.
(B) Section 1882(d)(3) (42 U.S.C. 1395ss(d)(3)) is amended
by adding at the end the following:
``(D)(i) If--
``(I) within the 90-day period beginning on the date of the
enactment of this subparagraph, the National Association of
Insurance Commissioners develops (after consultation with
consumer and insurance industry representatives) and submits to
the Secretary a statement for each of the types of health
insurance policies (other than medicare supplemental policies
and including, as separate types of policies, policies paying
directly to the beneficiary fixed, cash benefits) which are
sold to persons entitled to health benefits under this title,
of the extent to which benefits payable under the policy or
plan duplicate benefits under this title, and
``(II) the Secretary approves all the statements submitted
as meeting the requirements of subclause (I),
each such statement shall be (for purposes of subparagraph (C)) the
statement specified under this subparagraph for the type of policy
involved. The Secretary shall review and approve (or disapprove) all
the statements submitted under subclause (I) within 30 days after the
date of their submittal. Upon approval of such statements, the
Secretary shall publish such statements.
``(ii) If the Secretary does not approve the statements under
clause (i) or the statements are not submitted within the 90-day period
specified in such clause, the Secretary shall promulgate (after
consultation with consumer and insurance industry representatives and
not later than 90 days after the date of disapproval or the end of such
90-day period (as the case may be)) a statement for each of the types
of health insurance policies (other than medicare supplemental policies
and including, as separate types of policies, policies paying directly
to the beneficiary fixed, cash benefits) which are sold to persons
entitled to health benefits under this title, of the extent to which
benefits payable under the policy or plan duplicate benefits under this
title, and each such statement shall be (for purposes of subparagraph
(C)) the statement specified under this subparagraph for the type of
policy involved.''.
(C) The requirement of a disclosure under section
1882(d)(3)(C)(ii) of the Social Security Act shall not apply to
an application made for a policy or plan before 60 days after
the date of the Secretary of Health and Human Services
publishes or promulgates all the statements under section
1882(d)(3)(D) of such Act.
(4) Subparagraphs (A) and (B) of section 1882(q)(5) (42
U.S.C. 1395ss(q)(5)(A)) are amended by striking ``of the Social
Security Act''.
(e) Loss Ratios and Refunds of Premiums.--
(1) Section 1882(r) (42 U.S.C. 1395ss(r)) is amended--
(A) in paragraph (1), by striking ``or sold'' and
inserting ``or renewed (or otherwise provide coverage
after the date described in subsection (p)(1)(C))'';
(B) in paragraph (1)(A), by inserting ``for periods
after the effective date of these provisions'' after
``the policy can be expected'';
(C) in paragraph (1)(A), by striking
``Commissioners,'' and inserting ``Commissioners)'';
(D) in paragraph (1)(B), by inserting before the
period at the end the following: ``, treating policies
of the same type as a single policy for each standard
package'';
(E) by adding at the end of paragraph (1) the
following: ``For the purpose of calculating the refund
or credit required under paragraph (1)(B) for a policy
issued before the date specified in subsection
(p)(1)(C), the refund or credit calculation shall be
based on the aggregate benefits provided and premiums
collected under all such policies issued by an insurer
in a State (separated as to individual and group
policies) and shall be based only on aggregate benefits
provided and premiums collected under such policies
after the date specified in section 5091(m)(4) of the
Omnibus Budget Reconciliation Act of 1993.'';
(F) in the first sentence of paragraph (2)(A), by
striking ``by policy number'' and inserting ``by
standard package'';
(G) by striking the second sentence of paragraph
(2)(A) and inserting the following: ``Paragraph (1)(B)
shall not apply to a policy until 12 months following
issue.'';
(H) in the last sentence of paragraph (2)(A), by
striking ``in order'' and all that follows through
``are effective'';
(I) by adding at the end of paragraph (2)(A), the
following new sentence: ``In the case of a policy
issued before the date specified in subsection
(p)(1)(C), paragraph (1)(B) shall not apply until 1
year after the date specified in section 5091(m)(4) of
the Omnibus Budget Reconciliation Act of 1993.'';
(J) in paragraph (2), by striking ``policy year''
each place it appears and inserting ``calendar year'';
(K) in paragraph (4), by striking ``February'',
``disllowance'', ``loss-ratios'' each place it appears,
and ``loss-ratio'' and inserting ``October'',
``disallowance'', ``loss ratios'', and ``loss ratio'',
respectively;
(L) in paragraph (6)(A), by striking ``issues a
policy in violation of the loss ratio requirements of
this subsection'' and ``such violation'' and inserting
``fails to provide refunds or credits as required in
paragraph (1)(B)'' and ``policy issued for which such
failure occurred'', respectively; and
(M) in paragraph (6)(B), by striking ``to
policyholders'' and inserting ``to the policyholder or,
in the case of a group policy, to the certificate
holder''.
(2) Section 1882(b)(1) (42 U.S.C. 1395ss(b)(1)) is amended,
in the matter after subparagraph (H), by striking ``subsection
(F)'' and inserting ``subparagraph (F)''.
(3) Section 4355(d) of OBRA-1990 is amended by striking
``sold or issued'' and all that follows and inserting ``issued
or renewed (or otherwise providing coverage after the date
described in section 1882(p)(1)(C) of the Social Security Act)
on or after the date specified in section 1882(p)(1)(C) of such
Act.''.
(f) Treatment of HMO's.--
(1) Section 1882(g)(1) (42 U.S.C. 1395ss(g)(1)) is amended
by striking ``a health maintenance organization or other direct
service organization'' and all that follows through ``1833''
and inserting ``an eligible organization (as defined in section
1876(b)) if the policy or plan provides benefits pursuant to a
contract under section 1876 or an approved demonstration
project described in section 603(c) of the Social Security
Amendments of 1983, section 2355 of the Deficit Reduction Act
of 1984, or section 9412(b) of the Omnibus Budget
Reconciliation Act of 1986 or, during the period beginning on
the date specified in subsection (p)(1)(C) and ending on
December 31, 1994, a policy or plan of an organization if the
policy or plan provides benefits pursuant to an agreement under
section 1833(a)(1)(A)''.
(2) Section 4356(b) of OBRA-1990 is amended by striking
``on the date of the enactment of this Act'' and inserting ``on
the date specified in section 1882(p)(1)(C) of the Social
Security Act''.
(g) Pre-existing Condition Limitations.--Section 1882(s) (42 U.S.C.
1395ss(s)) is amended--
(1) in paragraph (2)(A), by striking ``for which an
application is submitted'' and inserting ``in the case of an
individual for whom an application is submitted prior to or'',
(2) in paragraph (2)(A), by striking ``in which the
individual (who is 65 years of age or older) first is enrolled
for benefits under part B'' and inserting ``as of the first day
on which the individual is 65 years of age or older and is
enrolled for benefits under part B'', and
(3) in paragraph (2)(B), by striking ``before it'' and
inserting ``before the policy''.
(h) Medicare Select Policies.--
(1) Section 1882(t) (42 U.S.C. 1395ss(t)) is amended--
(A) in paragraph (1), by inserting ``medicare
supplemental'' after ``If a'',
(B) in paragraph (1), by striking ``NAIC Model
Standards'' and inserting ``1991 NAIC Model Regulation
or 1991 Federal Regulation'',
(C) in paragraph (1)(A), by inserting ``or
agreements'' after ``contracts'',
(D) in subparagraphs (E)(i) and (F) of paragraph
(1), by striking ``NAIC standards'' and inserting
``standards in the 1991 NAIC Model Regulation or 1991
Federal Regulation'', and
(E) in paragraph (2), by inserting ``the issuer''
before ``is subject to a civil money penalty''.
(2) Section 1154(a)(4)(B) (42 U.S.C. 1320c-3(a)(4)(B)) is
amended--
(A) by inserting ``that is'' after ``(or'', and
(B) by striking ``1882(t)'' and inserting
``1882(t)(3)''.
(i) Health Insurance Counseling.--Section 4360 of OBRA-1990 is
amended--
(1) in subsection (b)(2)(A)(ii), by striking ``Act'' and
inserting ``Act)'';
(2) in subsection (b)(2)(D), by striking ``services'' and
inserting ``counseling'';
(3) in subsection (b)(2)(I), by striking ``assistance'' and
inserting ``referrals'';
(4) in subsection (c)(1), by striking ``and that such
activities will continue to be maintained at such level'';
(5) in subsection (d)(3), by striking ``to the rural
areas'' and inserting ``eligible individuals residing in rural
areas'';
(6) in subsection (e)--
(A) by striking ``subsection (c) or (d)'' and
inserting ``this section'',
(B) by striking ``and annually thereafter, issue an
annual report'' and inserting ``and annually thereafter
during the period of the grant, issue a report'', and
(C) in paragraph (1), by striking ``State-wide;'',
(7) in subsection (f), by striking paragraph (2) and by
redesignating paragraphs (3) through (5) as paragraphs (2)
through (4), respectively; and
(8) by redesignating the second subsection (f) (relating to
authorization of appropriations for grants) as subsection (g).
(j) Telephone Information System.--
(1) Section 1804 (42 U.S.C. 1395b-2) is amended--
(A) by adding at the end of the heading the
following: ``; medicare and medigap information'',
(B) by inserting ``(a)'' after ``1804.'', and
(C) by adding at the end the following new
subsection:
``(b) The Secretary shall provide information via a toll-free
telephone number on the programs under this title.''.
(2) Section 1882(f) (42 U.S.C. 1395ss(f)) is amended by
adding at the end the following new paragraph:
``(3) The Secretary shall provide information via a toll-free
telephone number on medicare supplemental policies (including the
relationship of State programs under title XIX to such policies).''.
(3) Section 1889 (42 U.S.C. 1395zz) is repealed.
(k) Mailing of Policies.--Section 1882(d)(4) (42 U.S.C.
1395ss(d)(4)) is amended--
(1) in subparagraph (D), by striking ``, if such policy''
and all that follows up to the period at the end, and
(2) by adding at the end the following new subparagraph:
``(E) Subparagraph (A) shall not apply in the case of an issuer who
mails or causes to be mailed a policy, certificate, or other matter
solely to comply with the requirements of subsection (q).''.
(l) Effective Date.--The amendments made by this section shall be
effective as if included in the enactment of OBRA-1990; except that--
(1) the amendments made by subsection (d)(1) shall take
effect on the date of the enactment of this Act, but no penalty
shall be imposed under section 1882(d)(3)(A) of the Social
Security Act (for an action occurring after the effective date
of the amendments made by section 4354 of OBRA-1990 and before
the date of the enactment of this Act) with respect to the sale
or issuance of a policy which is not unlawful under section
1882(d)(3)(A)(i)(II) of the Social Security Act (as amended by
this section);
(2) the amendments made by subsection (d)(2)(A) and by
subparagraphs (A), (B), and (E) of subsection (e)(1) shall be
effective on the date specified in subsection (m)(4); and
(3) the amendment made by subsection (g)(2) shall take
effect on January 1, 1994, and shall apply to individuals who
attain 65 years of age or older on or after the effective date
of section 1882(s)(2) of the Social Security Act (and, in the
case of individuals who attained 65 years of age after such
effective date and before January 1, 1994, and who were not
covered under such section before January 1, 1994, the 6-month
period specified in that section shall begin January 1, 1994).
(m) Transition Provisions.--
(1) In general.--If the Secretary of Health and Human
Services identifies a State as requiring a change to its
statutes or regulations to conform its regulatory program to
the changes made by this section, the State regulatory program
shall not be considered to be out of compliance with the
requirements of section 1882 of the Social Security Act due
solely to failure to make such change until the date specified
in paragraph (4).
(2) NAIC standards.--If, within 6 months after the date of
the enactment of this Act, the National Association of
Insurance Commissioners (in this subsection referred to as the
``NAIC'') modifies its 1991 NAIC Model Regulation (adopted in
July 1991) to conform to the amendments made by this section
and to delete from section 15C the exception which begins with
``unless'', such modifications shall be considered to be part
of that Regulation for the purposes of section 1882 of the
Social Security Act.
(3) Secretary standards.--If the NAIC does not make the
modifications described in paragraph (2) within the period
specified in such paragraph, the Secretary of Health and Human
Services shall make the modifications described in such
paragraph and such modifications shall be considered to be part
of that Regulation for the purposes of section 1882 of the
Social Security Act.
(4) Date specified.--
(A) In general.--Subject to subparagraph (B), the
date specified in this paragraph for a State is the
earlier of--
(i) the date the State changes its statutes
or regulations to conform its regulatory
program to the changes made by this section, or
(ii) 1 year after the date the NAIC or the
Secretary first makes the modifications under
paragraph (2) or (3), respectively.
(B) Additional legislative action required.--In the
case of a State which the Secretary identifies as--
(i) requiring State legislation (other than
legislation appropriating funds) to conform its
regulatory program to the changes made in this
section, but
(ii) having a legislature which is not
scheduled to meet in 1994 in a legislative
session in which such legislation may be
considered,
the date specified in this paragraph is the first day
of the first calendar quarter beginning after the close
of the first legislative session of the State
legislature that begins on or after January 1, 1994.
For purposes of the previous sentence, in the case of a
State that has a 2-year legislative session, each year
of such session shall be deemed to be a separate
regular session of the State legislature.
Subtitle B--Medicaid Program and Other Health Care Provisions
SEC. 5100. REFERENCES IN SUBTITLE; TABLE OF CONTENTS OF SUBTITLE.
(a) Amendments to Social Security Act.--Except as otherwise
specifically provided, whenever in this subtitle an amendment is
expressed in terms of an amendment to or repeal of a section or other
provision, the reference shall be considered to be made to that section
or other provision of the Social Security Act.
(b) References to OBRA.--In this subtitle, the terms ``OBRA-1986'',
``OBRA-1987'', ``OBRA-1989'', and ``OBRA-1990'' refer to the Omnibus
Budget Reconciliation Act of 1986 (Public Law 99-509), the Omnibus
Budget Reconciliation Act of 1987 (Public Law 100-203), the Omnibus
Budget Reconciliation Act of 1989 (Public Law 101-239), and the Omnibus
Budget Reconciliation Act of 1990 (Public Law 101-508), respectively.
(c) Table of Contents of Subtitle.--The table of contents of this
subtitle is as follows:
Subtitle B--Medicaid Program and Other Health Care Provisions
Sec. 5100. References in subtitle; table of contents of subtitle.
subchapter a--program savings provisions
Part I--Repeal of Mandate
Sec. 5101. Personal care services furnished outside the home as
optional benefit.
Part II--Outpatient Prescription Drugs
Sec. 5106. Permitting prescription drug formularies under State plans.
Sec. 5107. Elimination of special exemption from prior authorization
for new drugs.
Sec. 5108. Technical corrections relating to section 4401 of OBRA-1990.
Part III--Restrictions on Divestiture of Assets and Estate Recovery
Sec. 5111. Transfer of assets.
Sec. 5112. Medicaid estate recoveries.
Sec. 5113. Closing loophole permitting wealthy individuals to qualify
for medicaid.
Part IV--Improvement in Identification and Collection of Third Party
Payments
Sec. 5116. Liability of third parties to pay for care and services.
Sec. 5117. Health Coverage Clearinghouse.
``TITLE XXI--HEALTH COVERAGE CLEARINGHOUSE
``Sec. 2101. Establishment of clearinghouse.
``Sec. 2102. Provision of information.
``Sec. 2103. Requirement that employers furnish information.
``Sec. 2104. Data bank.''.
Sec. 5118. Medical child support.
Part V--Assuring Proper Payments to Disproportionate Share Hospitals
Sec. 5121. Assuring proper payments to disproportionate share
subchapter b--miscellaneous provisions
Part I--Anti-fraud and Abuse Provisions
Sec. 5131. Application of medicare rules limiting certain physician
referrals.
Sec. 5132. Intermediate sanctions for kickback violations.
Sec. 5133. Requiring maintenance of effort for State medicaid fraud
control units.
Part II--Managed Care Provisions
Sec. 5135. Medicaid managed care anti-fraud provisions.
Sec. 5136. Clarification of treatment of HMO enrollees in computing the
medicaid inpatient utilization rate in
qualifying hospitals as disproportionate
share hospitals.
Sec. 5137. Extension of period of applicability of enrollment mix
requirement to certain health maintenance
organizations providing services under
Dayton Area Health Plan.
Sec. 5138. Extension of medicaid waiver for Tennessee Primary Care
Network.
Sec. 5139. Waiver of application of medicaid enrollment mix requirement
to District of Columbia Chartered Health
Plan, Inc.
Sec. 5140. Extension of Minnesota Prepaid Medicaid Demonstration
Project.
Part III--Emergency Services to Undocumented Aliens
Sec. 5141. Increase in Federal financial participation for emergency
medical assistance to undocumented aliens.
Sec. 5142. Limiting Federal medicaid matching payment to bona fide
emergency services for undocumented aliens.
Part IV--Miscellaneous Provisions
Sec. 5144. Increase in limit on Federal medicaid matching payments to
Puerto Rico and other territories.
Sec. 5145. Criteria for making determinations of denial of Federal
medicaid matching payments to States.
Sec. 5146. Renewal of unfunded demonstration project for low-income
pregnant women and children.
Sec. 5147. Optional medicaid coverage of TB-related services for
certain PTB-infected individuals.
Sec. 5148. Application of mammography certification requirements under
the medicaid program.
Sec. 5149. Removal of sunset on extension of eligibility for working
families.
Sec. 5150. Extension of moratorium on treatment of certain facilities
as institutions for mental diseases.
Sec. 5150A. Treatment of certain clinics as federally-qualified health
centers.
subchapter c--miscellaneous and technical corrections relating to obra-
1990
Sec. 5151. Effective date.
Sec. 5152. Corrections relating to section 4402 (enrollment under group
health plans).
Sec. 5153. Corrections relating to section 4501 (low-income medicare
beneficiaries).
Sec. 5154. Corrections relating to section 4601 (child health).
Sec. 5155. Corrections relating to section 4602 (outreach locations).
Sec. 5156. Corrections relating to section 4604 (payment for hospital
services for children under 6 years of
age).
Sec. 5157. Corrections relating to section 4703 (payment adjustments
for disproportionate share hospitals).
Sec. 5158. Corrections relating to section 4704 (Federally-qualified
health centers).
Sec. 5159. Corrections relating to section 4708 (substitute
physicians).
Sec. 5160. Corrections relating to section 4711 (home and community
care for frail elderly).
Sec. 5161. Corrections relating to section 4712 (community supported
living arrangements services).
Sec. 5162. Correction relating to section 4713 (COBRA continuation
coverage).
Sec. 5163. Correction relating to section 4716 (medicaid transition for
family assistance).
Sec. 5164. Corrections relating to section 4723 (medicaid spenddown
option).
Sec. 5165. Corrections relating to section 4724 (optional State
disability determinations).
Sec. 5166. Correction relating to section 4732 (special rules for
health maintenance organizations).
Sec. 5167. Corrections relating to section 4741 (home and community-
based waivers).
Sec. 5168. Corrections relating to section 4744 (frail elderly
waivers).
Sec. 5169. Corrections relating to section 4747 (coverage of HIV-
positive individuals).
Sec. 5170. Correction relating to section 4751 (advance directives).
Sec. 5171. Corrections relating to section 4752 (physicians' services).
Sec. 5172. Corrections relating to section 4801 (nursing home reform).
Sec. 5173. Other technical corrections.
Sec. 5174. Corrections to designations of new provisions.
Chapter 2--Universal Access to Childhood Immunizations
Sec. 5181. Establishment of entitlement and monitoring programs with
respect to childhood immunizations.
``Subtitle 3--Entitlement and Monitoring Programs With Respect to
Childhood Immunizations
``Part A--Entitlement Program
``Sec. 2151. Delivery to States of sufficient quantities of
pediatric vaccines.
``Sec. 2152. Entitlements.
``Sec. 2153. Voluntary participation of health care providers.
``Sec. 2154. Intrastate distribution of pediatric vaccines.
``Sec. 2155. General provisions.
``Sec. 2156. State option regarding immunization of additional
categories of children.
``Sec. 2157. State application for vaccines.
``Sec. 2158. Contracts with manufacturers of pediatric
vaccines.
``Sec. 2159. Certain administrative variations.
``Sec. 2160. List of pediatric vaccines; schedule for
administration.
``Sec. 2161. Childhood Immunization Trust Fund.
``Sec. 2162. Definitions.
``Sec. 2163. Termination of program.
``Part B--National System for Monitoring Immunization Status of
Children
``Sec. 2171. Formula grants for State registries with respect
to monitoring.
``Sec. 2172. Registry data.
``Sec. 2173. General provisions.
``Sec. 2174. Application for grant.
``Sec. 2175. Determination of amount of allotment.
``Sec. 2176. Definitions.
``Sec. 2177. Authorization of appropriations.
``Part C--Funding for Other Purposes Regarding Childhood Immunizations
``Sec. 2181. Grants regarding Year 2000 health objectives.
Sec. 5182. National Vaccine Injury Compensation Program amendments.
Sec. 5183. Medicaid immunization provisions.
Sec. 5184. Availability of medicaid payments for childhood vaccine
replacement programs.
Sec. 5185. Healthy start for infants.
Sec. 5186. Increase in authorization of appropriations for the Maternal
and Child Health Services Block Grant
Program.
Sec. 5187. Miscellaneous technical corrections to Public Health Service
Act provisions.
CHAPTER 1--MEDICAID PROGRAM
Subchapter A--Program Savings Provisions
PART I--REPEAL OF MANDATE
SEC. 5101. PERSONAL CARE SERVICES FURNISHED OUTSIDE THE HOME AS
OPTIONAL BENEFIT.
(a) In General.--Section 1905(a) (42 U.S.C. 1396d(a)), as amended
by section 5174(c)(1), is further amended--
(1) in paragraph (7), by striking ``including personal care
services'' and all that follows through ``nursing facility'';
(2) in paragraph (23), by striking ``and'' at the end;
(3) by redesignating paragraph (24) as paragraph (25); and
(4) by inserting after paragraph (23) the following new
paragraph:
``(24) personal care services furnished to an individual
who is not an inpatient or resident of a nursing facility that
are (A) authorized by a physician for the individual in
accordance with a plan of treatment, (B) provided by an
individual who is qualified to provide such services and who is
not a member of the individual's family, (C) supervised by a
registered nurse, and (D) furnished in a home or other
location; and''.
(b) Conforming Amendments.--(1) Section 1902(a)(10)(C)(iv) (42
U.S.C. 1396a(a)(10)(C)(iv)), as amended by section 5174(c)(2)(A), is
amended by striking ``through (23)'' and inserting ``through (24)''.
(2) Section 1902(j) (42 U.S.C. 1396a(j)), as amended by section
5174(c)(2)(B), is amended by striking ``through (24)'' and inserting
``through (25)''.
(c) Effective Date.--The amendments made by subsections (a) and (b)
shall take effect as if included in the enactment of section 4721(a) of
OBRA-90.
PART II--OUTPATIENT PRESCRIPTION DRUGS
SEC. 5106. PERMITTING PRESCRIPTION DRUG FORMULARIES UNDER STATE PLANS.
(a) Elimination of Prohibition Against Use of Formularies.--
Paragraph (54) of section 1902(a)(54) (42 U.S.C. 1396a(a)(54)) is
amended to read as follows:
``(54) in the case of a State plan that provides medical
assistance for covered outpatient drugs (as defined in section
1927(k)), comply with the applicable requirements of section
1927;''.
(b) Standards for Formularies.--Section 1927(d) (42 U.S.C. 1396r-
8(d)), as amended by sections 5107(a) and 5108(b)(4)(A)(iii), is
amended--
(1) by adding at the end of paragraph (1) the following new
subparagraph:
``(C) In the case of a State that establishes a formulary
in accordance with paragraph (5), the State may exclude
coverage of a covered outpatient drug that is not included in
the formulary.''; and
(2) by inserting after paragraph (4) the following new
paragraph:
``(5) Requirements for formularies.--A State may establish
a formulary only if the following requirements are met:
``(A) The formulary is established by a committee
consisting of physicians, pharmacists, and other
appropriate individuals appointed by the Governor of
the State (or, at the option of the State, the State's
drug use review board established under subsection
(g)(3)).
``(B) Except as provided in subparagraph (C), the
formulary includes the covered outpatient drugs of any
manufacturer which has entered into and complies with
an agreement under subsection (a).
``(C) The committee may exclude a covered
outpatient drug with respect to the treatment of a
specific disease or condition for an identified
population (if any) only if the committee finds, based
on the drug's labeling (or, in the case of a drug whose
prescribed use is not approved under the Federal Food,
Drug, and Cosmetic Act but is a medically accepted
indication, based on information from the appropriate
compendia described in subsection (k)(6)), that the
excluded drug does not have a significant, clinically
meaningful therapeutic advantage in terms of safety,
effectiveness, or clinical outcome of such treatment
for such population over other drugs included in the
formulary.
``(D) With respect to a decision to exclude a
covered outpatient drug from the formulary or a
prescribed use of such a drug, the committee issues a
written explanation of its decision that is available
to the public, unless the decision was made at a
meeting of the committee which was open to the public.
``(E) The manufacturer of the drug, and any person
affected by the decision, may obtain a reversal of the
committee's decision to exclude a covered outpatient
drug from the formulary under subparagraph (C) on the
ground that the decision was arbitrary and capricious,
in accordance with an appeals process that is
established by the State and that provides an
opportunity for judicial review of such decision.
``(F) The State plan permits coverage of a drug
excluded from the formulary pursuant to a prior
authorization program that is consistent with paragraph
(4).
``(G) The formulary meets such other requirements
as the Secretary may impose.''.
(c) Effective Date.--The amendments made by this section shall
apply to calendar quarters beginning on or after October 1, 1993,
without regard to whether or not regulations to carry out such
amendments have been promulgated by such date.
SEC. 5107. ELIMINATION OF SPECIAL EXEMPTION FROM PRIOR AUTHORIZATION
FOR NEW DRUGS.
(a) In General.--Section 1927(d) (42 U.S.C. 1396r-8(d)), as amended
by section 5108(b)(4)(A)(iii), is amended by striking paragraph (5).
(b) Conforming Amendment.--Section 1927(d)(3) (42 U.S.C. 1396r-
8(d)(3)) is amended by striking ``(except with respect'' and all that
follows through ``of this paragraph)''.
(c) Effective Date.--The amendments made by this section shall
apply to calendar quarters beginning on or after October 1, 1993,
without regard to whether or not regulations to carry out such
amendments have been promulgated by such date.
SEC. 5108. TECHNICAL CORRECTIONS RELATING TO SECTION 4401 OF OBRA-1990.
(a) Section 1903, SSA.--Paragraph (10) of section 1903(i), as
inserted by section 4401(a)(1)(B) of OBRA-1990, is amended to read as
follows:
``(10) with respect to covered outpatient drugs unless
there is a rebate agreement in effect under section 1927 with
respect to such drugs or unless section 1927(a)(3) applies;''.
(b) Section 1927, SSA.--(1) Section 1927(a) (42 U.S.C. 1396r-8(a))
is amended--
(A) in paragraph (1)--
(i) by amending the second sentence to read as
follows: ``Any such agreement entered into prior to
April 1, 1991, shall be deemed to have been entered
into on January 1, 1991, and the amount of the rebate
under such agreement shall be calculated as if the
agreement had been entered into on January 1, 1991.'',
and
(ii) in the third sentence, by striking ``March''
and inserting ``April'';
(B) in paragraph (2)--
(i) by striking ``first'', and
(ii) by striking the period at the end and
inserting the following: ``, except that such paragraph
(and section 1903(i)(10)(A)) shall not apply to the
dispensing of such a drug before April 1, 1991, if the
Secretary determines that there were extenuating
circumstances with respect to the first calendar
quarter of 1991.'';
(C) in paragraph (3), by striking ``single source'' and all
that follows and inserting the following: ``covered outpatient
drugs if--
``(A) based on information provided by a
beneficiary's physician, the State has made a
determination that the availability of the drug is
essential to the health of the beneficiary under the
State plan, and the Secretary has reviewed and approved
such determination; and
``(B) the drug has been given a rating of 1-A by
the Food and Drug Administration.'';
(D) in paragraph (4)--
(i) by striking ``in compliance with'' and
inserting ``in effect under'', and
(ii) by striking ``coverage of the
manufacturer's drugs'' and inserting
``ingredient costs of the manufacturer's
covered outpatient drugs covered''; and
(E) by adding at the end the following new
paragraph:
``(5) Application in certain states and territories.--
``(A) Application in states operating under
demonstration projects.--In the case of any State which
is providing medical assistance to its residents under
a waiver granted under section 1115, the Secretary
shall require the State to meet the requirements of
section 1902(a)(54) and of this section in the same
manner as the State would be required to meet such
requirements if the State had in effect a plan approved
under this title.
``(B) No application in commonwealths and
territories.--This section, and sections 1902(a)(54)
and 1903(i)(10), shall only apply to a State that is
one of the 50 States or the District of Columbia.''.
(2) Section 1927(b) (42 U.S.C. 1396r-8(b)) is amended--
(A) in paragraph (1)(A)--
(i) by striking ``(or periodically in accordance
with a schedule specified by the Secretary)'' and
inserting ``(or other period specified by the
Secretary)'', and
(ii) by inserting ``after December 31, 1990, for
which payment was made'' after ``dispensed'';
(B) in paragraph (2)(A)--
(i) by striking ``calendar quarter'' and ``the
quarter'' and inserting ``rebate period'' and ``the
period'', respectively,
(ii) by striking ``dosage units'' and inserting
``units of each dosage form and strength'', and
(iii) by inserting ``after December 31, 1990, for
which payment was made'' after ``dispensed'';
(C) in paragraph (3)(A)--
(i) in clause (i), by striking ``quarter'' each
place it appears and inserting ``calendar quarter or
other rebate period under the agreement'',
(ii) in clause (i), by striking the open
parenthesis before ``for'' and the close parenthesis
after ``drugs'',
(iii) in clause (i), by striking ``subsection
(c)(2)(B)) for covered outpatient drugs'' and inserting
``subsection (c)(1)(C) for each covered outpatient
drug'', and
(iv) in clause (ii), by inserting a comma after
``this section'' and after ``1990'';
(D) in paragraph (3)(B)--
(i) by striking ``$100,000'' and inserting
``$10,000'',
(ii) by striking ``if the wholesaler'' and
inserting ``for each instance in which the
wholesaler'',
(iii) by inserting ``in response to such a
request'' after ``false information'', and
(iv) by striking ``(with respect to amounts of
penalties or additional assessments)'';
(E) in paragraph (3)(C)--
(i) in clause (i), by striking ``the penalty'' and
inserting ``the rebate next required to be paid'',
(ii) in clause (i), by striking ``and such amount
shall be paid to the Treasury, and, if'' and inserting
``. If'',
(iii) in clause (ii), by inserting ``under
subparagraph (A)'' after ``provides false
information'', and
(iv) in clause (ii), by striking ``Such civil money
penalties are'' and inserting ``Any such civil money
penalty shall be'';
(F) in paragraph (3)(D), by striking ``wholesaler,'' the
first place it appears and inserting ``wholesaler or the''; and
(G) in paragraph (4)(B)(iii), by adding at the end the
following: ``In the case of such a termination, a State may
terminate coverage of the drugs affected by such termination as
of the effective date of such termination without providing any
advance notice otherwise required by regulation.''.
(3) Section 1927(c) (42 U.S.C. 1396r-8(c)) is amended--
(A) in paragraph (1) in the matter preceding subparagraph
(A)--
(i) by striking the first sentence,
(ii) in the second sentence, by striking ``Except
as otherwise provided'' and all that follows through
``the Secretary)'' and inserting the following: ``For
purposes of this section, the amount of the rebate
under this subsection for a rebate period'', and
(iii) by inserting ``(except as provided in
subsection (b)(3)(C) and paragraph (2))'' after ``drugs
shall'';
(B) in paragraph (1)(A), by striking ``the quarter (or
other period)'' and inserting ``the rebate period'';
(C) in subparagraph (C)--
(i) by striking ``For purposes of this paragraph''
and inserting ``Best price defined.--For purposes of
this section'',
(ii) by inserting ``provider,'' after
``retailer,'', and
(iii) by striking the semicolon at the end and
inserting a period; and
(D) by striking subparagraph (D) and inserting the
following:
``(D) Use of estimated best prices during initial
year of availability of drug.--If the Secretary
determines that a manufacturer cannot determine the
best price for rebate periods during the first year in
which an agreement is in effect until after the end of
the year, as part of the agreement the Secretary may
require the manufacturer to estimate the best price for
rebate periods during the year and provide an
adjustment to the rebate paid to the State to take into
account the difference (if any) between the best price
and the estimated best price.''.
(4)(A) Section 1927(d) (42 U.S.C. 1396r-8(d)) is amended--
(i) in paragraph (2)--
(I) in subparagraph (A), by inserting ``or loss''
after ``gain'',
(II) by striking subparagraph (I), and
(III) by redesignating subparagraphs (J) and (K) as
subparagraphs (I) and (J);
(ii) in paragraph (3)--
(I) by striking ``described in paragraph (2)'', and
(II) by inserting ``described in paragraph (2)''
after ``classes of drugs,'';
(iii) by striking paragraph (4) and by redesignating
paragraphs (5) through (7) as paragraphs (4) through (6);
(iv) in paragraph (6), as so redesignated, by striking
``provided'' and inserting ``if''; and
(v) by striking the second sentence of paragraph (6), as so
redesignated, and paragraph (8) and inserting the following:
``(7) Construction with respect to fraud and abuse.--
Nothing in this section shall be construed to restrict the
authority of a State to apply sanctions under this Act against
any person for fraud or abuse.''.
(B) Section 1927(d)(4), as redesignated by subparagraph (A)(iii),
shall first apply to drugs dispensed on or after July 1, 1991.
(5)(A) Section 1927(f) (42 U.S.C. 1396r-8(f)) is amended to read as
follows:
``(f) No Reductions in Pharmacy Reimbursement Limits.--
``(1) In general.--During the period beginning on November
5, 1990, and ending on December 31, 1994--
``(A) a State may not reduce the amount paid by the
State under this title with respect to the ingredient
cost of a covered outpatient drug or the dispensing fee
for such a drug below the amount in effect as of
November 5, 1990, and
``(B) the Secretary may not change the regulations
in effect on November 5, 1990, governing the amounts
described in subparagraph (A) which are eligible for
Federal financial participation, to reduce the
reimbursement limits described in such regulations.
``(2) Construction.--If the Secretary notified a State
before November 5, 1990, that its payment amounts under this
title with respect to the ingredient cost of a covered
outpatient drug or the dispensing fee for such a drug were in
excess of those permitted under regulations in effect on such
date, paragraph (1)(B) shall not be construed as preventing a
State from reducing payment amounts or dispensing fee in order
to comply with such regulations.''.
(B) Not later than April 1, 1994, the Secretary of Health and Human
Services shall establish an upper limit on the amount of payment which
is eligible for Federal financial participation under title XIX of the
Social Security Act for each multiple source drug (as defined in
section 1927(k)(7)(A)(i) of such Act) for which the Food and Drug
Administration has rated at least 3 formulations of such drug as
therapeutically and pharmaceutically equivalent, regardless of whether
all the formulations of such drug are rated as so equivalent. In
establishing such a limit for a drug, the Secretary shall take into
account only those formulations of the drug which the Food and Drug
Administration has rated as therapeutically and pharmaceutically
equivalent.
(6) Section 1927(g) (42 U.S.C. 1396r-8(g)) is amended--
(A) by amending paragraph (1) to read as follows:
``(1) Requirement for drug use review program.--Each State
shall provide, by not later than January 1, 1993, for a drug
use review program for covered outpatient drugs (other than
drugs dispensed to residents of nursing facilities) that--
``(A) meets the requirements of paragraph (2), and
``(B) is intended to assure that prescriptions for
such drugs are appropriate, medically necessary, and
not likely to lead to adverse medical results.'';
(B) in paragraph (2)--
(i) by amending the matter before subparagraph (A)
to read as follows:
``(2) Requirements.--'',
(ii) by amending subparagraph (A) to read as
follows:
``(A) Prospective drug use review.--Each drug use
review program shall provide for a review of drug
therapy before each prescription is filled or delivered
to an individual receiving benefits under this title
(including counseling by pharmacists) consistent with
standards established by the Secretary. Nothing in this
paragraph shall be construed as requiring a pharmacist
to provide consultation when an individual receiving
benefits under this title or caregiver of such
individual refuses such consultation.'',
(iii) in subparagraph (C)--
(I) by striking ``Application of
standards.--'' and inserting ``Standards.--
(i)'',
(II) by striking ``and literature referred
to in subsection (1)(B)'' and inserting
``described in clause (ii)'',
(III) by striking ``including but not
limited to'' and inserting ``. Such assessment
shall include'',
(IV) by striking ``abuse/misuse and, as
necessary, introduce remedial strategies,'' and
inserting ``abuse or misuse and introduce
remedial strategies'', and
(V) by adding at the end the following new
clause:
``(ii) The compendia described in this clause are
the American Hospital Formulary Service Drug
Information, the United States Pharmacopeia-Drug
Information, and the American Medical Association Drug
Evaluations.'', and
(iv) by amending subparagraph (D) to read as
follows:
``(D) Educational program.--The program shall
educate (directly or by contract) pharmacists,
physicians, and other individuals prescribing or
dispensing covered outpatient drugs under the State
plan on common drug therapy problems in order to
improve prescribing or dispensing practices.'';
(C) in paragraph (3)--
(i) in subparagraph (A), by striking
``(hereinafter'' and all that follows and inserting
``(in this paragraph referred to as the `DUR
Board').'',
(ii) in subparagraph (B), by striking ``51
percent'' and all that follows and inserting ``50
percent licensed and actively practicing physicians and
at least 1/3 but not more than 50 percent licensed and
actively practicing pharmacists.'',
(iii) by amending subparagraph (C) to read as
follows:
``(C) Responsibilities.--The responsibilities of
the DUR Board shall include the following:
``(i) Carrying out retrospective drug use
review pursuant to paragraph (2)(B).
``(ii) Establishing and applying standards
for drug use review described in paragraph
(2)(C).
``(iii) Implementing educational programs
described in paragraph (2)(D).
``(iv) Conducting ongoing evaluations of
the effectiveness of its programs and
activities in improving the quality and safety
of drug therapy for individuals receiving
benefits under the State plan.''; and
(D) by amending subparagraph (D) to read as follows:
``(4) Annual report.--Each State shall submit a report each
year to the Secretary on the nature and scope of the drug use
review program under this subsection. Such report shall include
an estimate of cost savings resulting from operation of such
program.''.
(7) Section 1927(h) (42 U.S.C. 1396r-8(h)) is amended to read as
follows:
``(h) Encouraging Electronic Claims Management.--The Secretary
shall encourage each single State agency under this title to establish,
as its principal means of processing claims for covered outpatient
drugs, a point-of-sale electronic claims management system for the
purpose of verifying eligibility, transmitting data on claims, and
assisting pharmacists and other authorized persons in applying for and
receiving payment under the State plan.''.
(8) Section 1927(i) (42 U.S.C. 1396r-8(i)) is amended to read as
follows:
``(i) Annual Report on Rebate Program.--Not later than May 1 of
each year, the Secretary shall submit to the Committee on Finance of
the Senate, the Committee on Energy and Commerce of the House of
Representatives, and the Committee on Aging of the Senate a report on
the operation of the rebate agreements required for covered outpatient
drugs under this section in the preceding fiscal year, and shall
include in the report such information in addition to the information
required to be reported under section 601(d) of the Veterans Health
Care Act of 1992 as the Secretary considers appropriate.''.
(9) Section 1927(j) (42 U.S.C. 1396r-8(j)) is amended to read as
follows:
``(j) Exemption From Certain Requirements for Certain Health
Maintenance Organizations and Hospitals.--
``(1) Certain health maintenance organizations and
pharmacies.--The requirements of subsections (g) and (h) shall
not apply with respect to covered outpatient drugs dispensed
by--
``(A) an entity which receives payment under a
prepaid capitation basis or under any other risk basis
in accordance with section 1903(m)(2)(A) for services
provided under the State plan; or
``(B) a pharmacy that is owned or operated by a
qualified health maintenance organization (as defined
in section 1310(d) of the Public Health Service Act)
that operates its own prospective drug use review
program.
``(2) Hospitals with independent formulary systems.--
``(A) In general.--The requirements of subsections
(g) and (h) shall not apply with respect to covered
outpatient drugs dispensed by a hospital providing
medical assistance under the State plan that dispenses
such drugs under a drug formulary system.
``(B) Application of state formulary.--Nothing in
subparagraph (A) shall be construed to permit payment
to be made under the State plan for a covered
outpatient drug that is included in a drug formulary
but that is not included in the State formulary under
subsection (d)(5).
``(3) Construction in determining best price.--Nothing in
this subsection shall be construed to exclude any covered
outpatient drugs subject to the provisions of this subsection
from the determination of the best price (as defined in
subsection (c)(1)(C)) for such drugs.''.
(10) Section 1927(k) (42 U.S.C. 1396r-8(k)) is amended--
(A) in paragraph (1), by striking ``calendar quarter'' and
inserting ``rebate period'';
(B) in paragraph (2)--
(i) in the matter before clause (i) of subparagraph
(A), by striking ``paragraph (5)'' and inserting
``subparagraph (D)'',
(ii) by striking ``, and'' at the end of
subparagraph (A),
(iii) by striking the period at the end of
subparagraph (C) and inserting ``; and'', and
(iv) by adding at the end the following new
subparagraph:
``(D) a drug which may be sold without a
prescription (commonly referred to as an `over-the-
counter drug'), if the drug is prescribed by a
physician (or other person authorized to prescribe
under State law).'';
(C) in paragraph (3)--
(i) in subparagraph (E), by striking ``****
emergency room visits'',
(ii) in subparagraph (F), by striking ``sevices''
and inserting ``services'', and
(iii) in subparagraph (H), by inserting
``services'' after ``dialysis'';
(D) by striking paragraph (4);
(E) by amending paragraph (5) to read as follows:
``(5) Manufacturer.--The term `manufacturer' means, with
respect to a covered outpatient drug,--
``(A) the entity (if any) that both manufactures
and distributes the drug, or
``(B) if no such entity exists, the entity that
distributes the drug.
Such term does not include a wholesale distributor of the drug
that does not hold a National Drug Code number for the drug or
a retail pharmacy licensed under State law.'';
(F) in paragraph (6), by striking ``, which appears'' and
all that follows and inserting ``which is accepted by any of
the compendia described in subsection (g)(2)(C)(ii).'';
(G) in paragraph (7)--
(i) in subparagraph (A)(i), by striking ``calendar
quarter'' and inserting ``rebate period'',
(ii) in subparagraph (A)(i), by striking
``paragraph (5)'' and inserting ``paragraph (2)(D)'',
(iii) in subparagraph (A)(ii), by inserting ``or
product licensing application'' after ``application'',
(iv) in subparagraph (C)(i), by striking
``pharmaceuutically'' and inserting
``pharmaceutically'', and
(v) in subparagraph (C)(iii), by striking ``,
provided that'' and inserting ``and''; and
(H) by redesignating paragraph (8) as paragraph (9) and by
inserting after paragraph (7) the following new paragraph:
``(8) Rebate period.--The term `rebate period' means, with
respect to an agreement under subsection (a), a calendar
quarter or other period specified with respect to the agreement
under subsection (b)(1)(A) for the payment of rebates.''.
(d) Funding.--Section 4401(b)(2) of OBRA-1990 is amended by
striking ``75 percent,'' and all that follows and inserting ``75
percent.''.
(e) Demonstration Projects.--Section 4401(c)(1) of OBRA-1990 is
amended--
(A) in subparagraph (A), by striking ``10'' and inserting
``5''; and
(B) in subparagraph (C), by striking ``regiment'' and
inserting ``regimen''.
(f) Studies.--Section 4401(d) of OBRA-1990 is amended--
(1) in paragraph (1)(A), by striking ``other institutional
facilities, and managed care plans'' and inserting ``nursing
facilities, intermediate care facilities for the mentally
retarded, and health maintenance organizations'';
(2) in paragraph (1)(B), by striking ``under this
subsection'' and inserting ``under this paragraph'';
(3) in paragraph (1)(B)(i), by striking ``under this
section'' and inserting ``under section 1927 of the Social
Security Act'';
(4) in paragraph (1)(B)(ii)--
(A) by striking ``drug use review'' the second
place it appears and inserting ``the type of drug use
review that is'', and
(B) by striking ``under this section'' and
inserting ``under such section'';
(5) in paragraph (1)(B)(iii), by striking ``under this
title'' and inserting ``under title XIX of the Social Security
Act'';
(6) in paragraph (1)(C)--
(A) by striking ``May 1, 1991'' and inserting ``May
1, 1992'', and
(B) by striking ``hereafter'';
(7) in paragraph (2), by striking ``the Committees on Aging
of the Senate and House of Representatives an annual report''
and inserting ``the Committee on Aging of the Senate a
report'';
(8) in paragraph (3)--
(A) in subparagraph (A), by striking ``, acting in
consultation with the Comptroller General,'', and
(B) in subparagraph (B)--
(i) by striking ``December 31, 1991, the
Secretary and the Comptroller General'' and
inserting ``June 1, 1993, the Secretary'', and
(ii) by striking ``the Committees on Aging
of the Senate and the House of
Representatives'' and inserting ``the Committee
on Aging of the Senate'';
(9) in paragraph (4)(A), by striking ``each'' and by
striking the semicolon and inserting a comma; and
(10) by striking paragraphs (5) and (6).
PART III--RESTRICTIONS ON DIVESTITURE OF ASSETS AND ESTATE RECOVERY
SEC. 5111. TRANSFER OF ASSETS.
(a) Period of Ineligibility.--
(1) Extending look-back period to 36 months.--Section
1917(c)(1) (42 U.S.C. 1396p(c)(1)) is amended by striking ``30-
month period'' and inserting ``36-month period''.
(2) Eliminating 30-month limit on period of
ineligibility.--The second sentence of such section is amended
by striking ``equal to'' and all that follows and inserting the
following: ``equal to--
``(A) the total uncompensated value of the resources so
transferred; divided by
``(B) the average monthly cost, to a private patient at the
time of the application, of nursing facility services in the
State or, at State option, in the community in which the
individual is institutionalized.''.
(3) Cumulative periods of ineligibility in the case of
multiple transfers.--Such sentence is further amended by
inserting ``(or, in the case of a transfer which occurs during
a period of ineligibility attributable to a previous transfer,
the first month after the end of all periods of ineligibility
attributable to any previous transfer)'' after ``shall begin
with the month in which such resources were transferred''.
(b) Criteria for Undue Hardship Exception.--Section 1917(c)(2)(D)
(42 U.S.C. 1396p(c)(2)(D)) is amended to read as follows:
``(D) the State agency determines, under procedures
established by the State (in accordance with standards
specified by the Secretary) that the denial of eligibility
would work an undue hardship (in accordance with criteria
established by the Secretary).''.
(c) Treatment of Jointly Held Assets.--Section 1917(c) (42 U.S.C.
1936p(c)) is further amended by adding at the end the following new
paragraph:
``(6) For purposes of this subsection, in the case of an asset held
by an individual in common with another person or persons in a joint
tenancy or a similar arrangement, the asset (or the affected portion
thereof) shall be considered to be transferred by such individual when
any action is taken, either by such individual or by any other person,
that reduces or eliminates such individual's ownership or control of
such asset.''.
(d) Medicaid Qualifying Trusts.--Section 1902(k) (42 U.S.C.
1396a(k)) is amended to read as follows:
``(k) Treatment of Trust Amounts.--
``(1) In general.--For purposes of determining an
individual's eligibility for or amount of benefits under a
State plan under this title, subject to paragraph (4), the
following rules shall apply to a trust (which term includes,
for purposes of this subsection, any similar legal instrument
or device, such as an annuity) established by such individual:
``(A) Revocable trusts.--In the case of a revocable
trust--
``(i) the corpus of the trust shall be
considered resources available to the
individual,
``(ii) payments from the trust to or for
the benefit of the individual shall be
considered income of the individual, and
``(iii) any other payments from the trust
shall be considered a transfer of assets by the
individual subject to section 1917(c).
``(B) Irrevocable trusts which may benefit
grantor.--In the case of an irrevocable trust, if there
are any circumstances under which payment from the
trust could be made to or for the benefit of the
individual--
``(i) the corpus of the trust (or that
portion of the corpus from which, or from the
increase whereof, payment to the individual
could be made) shall be considered resources
available to the individual, and payments from
that portion of the corpus (or increase)--
``(I) to or for the benefit of the
individual, shall be considered income
of the individual, and
``(II) for any other purpose, shall
be considered a transfer of assets by
the individual subject to the
provisions of section 1917(c); and
``(ii) any portion of the trust from which
(or from the income whereof) no payment could
under any circumstances be made to the
individual shall be considered, as of the date
of establishment of the trust (or, if later,
the date on which payment to the individual was
foreclosed), a transfer of assets by the
individual subject to section 1917(c), and
payments from such portion of the trust after
such date shall be disregarded.
``(C) Irrevocable trusts which cannot benefit
grantor.--In the case of an irrevocable trust, if no
payment may be made from the trust under any
circumstances to or for the benefit of the individual--
``(i) the corpus of the trust shall be
considered, as of the date of establishment of
the trust (or, if later, the date on which
payment to the individual was foreclosed), a
transfer of assets subject to section 1917(c),
and
``(ii) payments from the trust after the
date specified in clause (i) shall be
disregarded.
``(2) Determination of grantor.--
``(A) Treatment of acts by individual and others.--
For purposes of this subsection, an individual shall be
considered to have established a trust if--
``(i) the individual (or the individual's
spouse), or a person (including a court or
administrative body) with legal authority to
act in place of or on behalf of such individual
(or spouse), or any person (including any court
or administrative body) acting at the direction
or upon the request of such individual (or
spouse), established (other than by will) such
a trust, and
``(ii) assets of the individual (as defined
in subparagraph (B)) were used to form all or
part of the corpus of such trust.
``(B) Assets.--For purposes of this paragraph,
assets of an individual include all income and
resources of the individual and of the individual's
spouse, including any income or resources which the
individual (or spouse) is entitled to but does not
receive because of action by the individual (or
spouse), by a person (including a court or
administrative body) with legal authority to act in
place of or on behalf of such individual (or spouse),
or by any person (including any court or administrative
body) acting at the direction or upon the request of
such individual (or spouse).
``(C) Trusts containing assets of more than one
individual.--In the case of a trust whose corpus
includes assets of an individual (as determined
pursuant to subparagraph (A)) and assets of any other
person or persons, the provisions of this subsection
shall apply to the portion of the trust attributable to
the assets of the individual.
``(3) Application; relation to other provisions.--Subject
to paragraph (4), this subsection shall apply without regard
to--
``(A) the purposes for which the trust is
established,
``(B) whether the trustees have or exercise any
discretion under the trust,
``(C) any restrictions on when or whether
distributions may be made from the trust, or
``(D) any restrictions on the use of distributions
from the trust.
``(4) Exceptions and hardship waiver.--
``(A) Exception for certain trusts.--This
subsection shall not apply to any of the following
trusts:
``(i) A trust established for the benefit
of a disabled individual (as determined under
section 1614(a)(3)) by a parent, grandparent,
or other representative payee of the
individual.
``(ii) A trust established in a State for
the benefit of an individual if--
``(I) the trust is composed only of
pension, Social Security, and other
income to the individual (and
accumulated income in the trust),
``(II) the State will receive any
amounts remaining in the trust upon the
death of the individual, and
``(III) the State makes medical
assistance available to individuals
described in section
1902(a)(10)(A)(ii)(V), but does not
make such assistance available to any
group of individuals under section
1902(a)(10)(C).
``(B) Special treatment of annuities.--In this
subsection, the term `trust' includes an annuity only
to such extent and in such manner as the Secretary
specifies.
``(C) Hardship waiver.--The State agency shall
establish procedures (in accordance with standards
specified by the Secretary) under which the agency
waives the application of this subsection with respect
to an individual if the individual establishes (under
criteria established by the Secretary) that such
application would work an undue hardship on the
individual.''.
(e) Effective Date.--(1) The amendments made by this section shall
apply, except as provided in this subsection, to payments under title
XIX of the Social Security Act for calendar quarters beginning on or
after October 1, 1993, without regard to whether or not final
regulations to carry out such amendments have been promulgated by such
date.
(2) The amendments made by this section shall not apply--
(A) to medical assistance provided for services furnished
before October 1, 1993,
(B) with respect to resources disposed of before May 11,
1993,
(C) with respect to trusts established before May 11, 1993,
or
(D) with respect to inter-spousal transfers.
SEC. 5112. MEDICAID ESTATE RECOVERIES.
(a) Requiring Establishment of Estate Recovery Programs.--
(1) In general.--Section 1902(a)(51) (42 U.S.C.
1396a(a)(51)) is amended by striking ``and (B)'' and inserting
``(B) provide for an estate recovery program that meets the
requirements of section 1917(b)(1), and (C)''.
(2) Requirements for estate recovery programs.--Section
1917(b) (42 U.S.C. 1396p(b)) is amended--
(A) in paragraph (1)--
(i) by striking ``(b)(1)'' and inserting
``(2)'', and
(ii) by striking ``(a)(1)(B)'' and
inserting ``(a)(1)(B)(i)'';
(B) in paragraph (2), by striking ``(2) Any
adjustment or recovery under'' and inserting ``(3) Any
adjustment or recovery under an estate recovery program
under''; and
(C) by inserting before paragraph (2), as
designated by subparagraph (A), the following:
``(b)(1) For purposes of section 1902(a)(51)(B), the requirements
for an estate recovery program of a State are as follows:
``(A) The program provides for identifying and tracking
(and, at the option of the State, preserving) resources
(whether excluded or not) of individuals who are furnished any
of the following long-term care services for which medical
assistance is provided under this title:
``(i) Nursing facility services.
``(ii) Home and community-based services (as
defined in section 1915(d)(5)(C)(i)).
``(iii) Services described in section 1905(a)(14)
(relating to services in an institution for mental
diseases).
``(iv) Home and community care provided under
section 1929.
``(v) Community supported living arrangements
services provided under section 1930.
``(B) The program provides for promptly ascertaining--
``(i) when such an individual dies;
``(ii) in the case of such an individual who was
married at the time of death, when the surviving spouse
dies; and
``(iii) at the option of the State, cases in which
adjustment or recovery may not be made at the time of
death because of the application of paragraph (3)(A) or
paragraph (3)(B).
``(C)(i) The program provides for the collection consistent
with paragraph (3) of an amount (not to exceed the amount
described in clause (ii)) from--
``(I) the estate of the individual;
``(II) in the case of an individual described in
subparagraph (B)(ii), from the estate of the surviving
spouse; or
``(III) at the option of the State, in a case
described in subparagraph (B)(iii), from the
appropriate person.
``(ii) The amount described in this clause is the amount of
medical assistance correctly paid under this title for long-
term care services described in subparagraph (A) furnished on
behalf of the individual.''.
(b) Hardship Waiver.--Section 1917(b) (42 U.S.C. 1396p(b)) is
further amended by adding at the end the following new paragraph:
``(4) The State agency shall establish procedures (in accordance
with standards specified by the Secretary) under which the agency
waives the application of this subsection if such application would
work an undue hardship (in accordance with criteria established by the
Secretary).''.
(c) Definition of Estate.--Section 1917(b) (42 U.S.C. 1396(b)) is
further amended by adding at the end the following new paragraph:
``(5) For purposes of this section, the term `estate', with respect
to a deceased individual, includes all real and personal property and
other assets in which the individual had any legally cognizable title
or interest at the time of his death, including such assets conveyed to
a survivor, heir, or assign of the deceased individual through joint
tenancy, survivorship, life estate, living trust, or other
arrangement.''.
(d) Effective Date.--
(1)(A) The amendments made by subsections (a) and (b) apply
(except as provided under subparagraph (B)) to payments under
title XIX of the Social Security Act for calendar quarters
beginning on or after October 1, 1993, without regard to
whether or not final regulations or standards to carry out such
amendments have been promulgated by such date.
(B) In the case of a State plan for medical assistance
under title XIX of the Social Security Act which the Secretary
of Health and Human Services determines requires State
legislation (other than legislation appropriating funds) in
order for the plan to meet the additional requirements imposed
by the amendments made by subsections (a) and (b), the State
plan shall not be regarded as failing to comply with the
requirements of such title solely on the basis of its failure
to meet these additional requirements before the first day of
the first calendar quarter beginning after the close of the
first regular session of the State legislature that begins
after the date of the enactment of this Act. For purposes of
the previous sentence, in the case of a State that has a 2-year
legislative session, each year of such session shall be deemed
to be a separate regular session of the State legislature.
(2) The amendments made by this section shall not apply to
individuals who died before October 1, 1993.
SEC. 5113. CLOSING LOOPHOLE PERMITTING WEALTHY INDIVIDUALS TO QUALIFY
FOR MEDICAID.
(a) In General.--Section 1902(r)(2) (42 U.S.C. 1396a(r)(2)) is
amended by adding at the end the following:
``(C)(i) Notwithstanding subparagraph (A), except as provided in
clause (ii), a State plan may not provide pursuant to this paragraph
for disregarding any assets--
``(I) to the extent that payments are made under a long-
term care insurance policy; or
``(II) because an individual has received (or is entitled
to receive) benefits for a specified period of time under a
long-term care insurance policy.
``(ii) Clause (i) shall not apply to State plan provisions that are
approved as of May 14, 1993.''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect on the date of the enactment of this Act.
PART IV--IMPROVEMENT IN IDENTIFICATION AND COLLECTION OF THIRD PARTY
PAYMENTS
SEC. 5116. LIABILITY OF THIRD PARTIES TO PAY FOR CARE AND SERVICES.
(a) Liability of ERISA Plans.--(1) Section 1902(a)(25)(A) (42
U.S.C. 1396a(a)(25)(A)) is amended by striking ``insurers)'' and
inserting ``insurers and group health plans (as defined in section
607(1) of the Employee Retirement Income Security Act of 1974) and
including a service benefit plan and a health maintenance
organization)''.
(2) Section 1903(o) of such Act (42 U.S.C. 1396b(o)) is amended by
striking ``regulation)'' and inserting ``regulation and including a
group health plan (as defined in section 607(1) of the Employee
Retirement Income Security Act of 1974)), a service benefit plan, and a
health maintenance organization''.
(b) Requiring State to Prohibit Insurers From Taking Medicaid
Status Into Account.--Section 1902(a)(25) (42 U.S.C. 1396a(a)(25)) is
amended--
(1) by striking ``and'' at the end of subparagraph (F);
(2) by adding ``and'' at the end of subparagraph (G); and
(3) by adding after subparagraph (G) the following new
subparagraph:
``(H) that the State prohibits any health insurer
(including a group health plan, as defined in section
607(1) of the Employee Retirement Income Security Act
of 1974, a service benefit plan, and a health
maintenance organization), in enrolling an individual
or in making any payments for benefits to the
individual or on the individual's behalf, from taking
into account that the individual is eligible for or is
provided medical assistance under a State plan;''.
(c) State Right to Subrogation.--Section 1902(a)(25) (42 U.S.C.
1396a(a)(25)), as amended by subsection (b), is further amended--
(1) by striking ``and'' at the end of subparagraph (G);
(2) by adding ``and'' at the end of subparagraph (H); and
(3) by adding after subparagraph (H) the following new
subparagraph:
``(I) that to the extent that payment has been made
under the State plan for medical assistance in any case
where a third party has a legal liability to make
payment for such assistance, the State is subrogated to
the right of any other party to payment for such
assistance;''.
(d) Effective Date.--(1) Except as provided in paragraph (2), the
amendments made by subsections (a)(1), (b), and (c) shall apply to
calendar quarters beginning on or after October 1, 1993, without regard
to whether or not final regulations to carry out such amendments have
been promulgated by such date.
(2) In the case of a State plan for medical assistance under title
XIX of the Social Security Act which the Secretary of Health and Human
Services determines requires State legislation (other than legislation
appropriating funds) in order for the plan to meet the additional
requirements imposed by the amendments made by subsections (a) and (b),
the State plan shall not be regarded as failing to comply with the
requirements of such title solely on the basis of its failure to meet
these additional requirements before the first day of the first
calendar quarter beginning after the close of the first regular session
of the State legislature that begins after the date of the enactment of
this Act. For purposes of the previous sentence, in the case of a State
that has a 2-year legislative session, each year of such session shall
be deemed to be a separate regular session of the State legislature.
(3) The amendment made by subsection (a)(2) shall apply to items
and services furnished on or after October 1, 1993.
SEC. 5117. HEALTH COVERAGE CLEARINGHOUSE.
(a) In General.--The Social Security Act is amended by adding at
the end the following new title:
``TITLE XXI--HEALTH COVERAGE CLEARINGHOUSE
``establishment of clearinghouse
``Sec. 2101. (a) In General.--The Secretary shall establish and
operate a Health Coverage Clearinghouse (in this title referred to as
the `Clearinghouse') for the purpose of identifying, for beneficiaries
of a covered health program (as defined in subsection (c)), third
parties (which may include a covered health program) which may be
liable for payment for health care items and services furnished to such
beneficiaries under such program.
``(b) Director.--The Clearinghouse shall be headed by a Director
(in this title referred to as the `Director') appointed by the
Secretary.
``(c) Covered Health Program Defined.--In this title, the term
`covered health program' means any of the following under which payment
is made for health care items or services furnished to a beneficiary:
``(1) The medicare program under title XVIII.
``(2) A State plan for medical assistance under title XIX
(including a State plan operating under a Statewide waiver
under section 1115).
``(3) The Indian Health Service and any program under the
Indian Health Care Improvement Act.
``(4) A State program under title V that provides payment
for items or services.
``(d) Other Definitions.--In this title:
``(1) The term `administrator' means, with respect to the
covered health program described in--
``(A) subsection (c)(1), the Administrator of the
Health Care Financing Administration;
``(B) subsection (c)(2), the single State agency
referred to in section 1902(a)(5);
``(C) subsection (c)(3), the Director of the Indian
Health Service; and
``(D) subsection (c)(4), the State agency receiving
funds under title V.
``(2) The term `group health plan' has the meaning given
such term in section 6103(l)(12)(E)(ii) of such Code.
``(3) The term `qualified employer' has the meaning given
such term in section 6103(l)(12)(E)(iii) of the Internal
Revenue Code of 1986.
``provision of information
``Sec. 2102. (a) Request for Information.--An administrator of a
covered health program may request from the Director information
concerning the employment and group health coverage of a program
beneficiary, the beneficiary's spouse, and (if the beneficiary is a
dependent child) the beneficiary's parents. The Director shall provide
such information if the request--
``(1) is in such form and manner and at such a time as the
Director may require, and
``(2) specifies the name and tax identification number of
the beneficiary.
``(b) Data Matching Program.--
``(1) Request by director.--The Director shall, at such
intervals as the Director finds appropriate, transmit to the
Secretary of the Treasury the names and tax identification
numbers of beneficiaries with respect to whom a request has
been made pursuant to subsection (a), and request that such
Secretary disclose to the Commissioner of Social Security the
following information:
``(A) Whether the beneficiary is married and, if
so, the name of the spouse and such spouse's tax
identification number.
``(B) If the beneficiary is a dependent child, the
name of and tax identification numbers of the
beneficiary's parents.
``(2) Information from commissioner of social security.--
The Secretary, acting through the Commissioner of Social
Security, shall, upon written request from the Director,
disclose to the Director, the following information:
``(A) For each individual who is identified as
having received wages (as defined in section 3401(a) of
the Internal Revenue Code of 1986) from, and as having
available coverage under a group health plan of, an
employer in a previous year--
``(i) the name and taxpayer identification
number of the individual;
``(ii) the name, address, and taxpayer
identification number of the employer, and
whether such employer is a qualified employer;
and
``(iii) whether the employer has made
available a group health plan to the employee
and the plan coverage provided (if any) with
respect to the employee and family members of
the employee under the group health plan.
``(B) For each individual who is identified as
married and whose spouse is identified as having
received wages (as defined in section 3401(a) of the
Internal Revenue Code of 1986) from, and as having
available coverage under a group health plan of, an
employer in a previous year--
``(i) the name and taxpayer identification
number of the individual and of the
individual's spouse;
``(ii) the name, address, and taxpayer
identification number of the spouse's employer,
and whether such employer is a qualified
employer; and
``(iii) whether the spouse's employer has
made available a group health plan to the
spouse and the plan coverage provided (if any)
with respect to the spouse and family members
of the spouse under the group health plan.
``(C) For each individual who is identified as a
dependent child and whose parent is identified as
having received wages (as defined in section 3401(a) of
the Internal Revenue Code of 1986) from, and as having
available coverage under a group health plan of, an
employer in a previous year--
``(i) the name and taxpayer identification
number of the individual and of the
individual's parent;
``(ii) the name, address, and taxpayer
identification number of the parent's employer,
and whether such employer is a qualified
employer; and
``(iii) whether the parent's employer has
made available a group health plan to the
parent and the plan coverage provided (if any)
with respect to the parent and dependent
children of the parent under the group health
plan.
``(3) Information from employers.--The Director shall--
``(A) request, from the employer of each individual
(including each spouse) with respect to whom
information was received from the Commissioner of
Social Security pursuant to paragraph (2), specific
information concerning coverage of such individual (and
of the individual's spouse and dependent children)
under the employer's group health plan (including the
period and nature of the coverage, and the name,
address, and identifying number of the plan), and
``(B) furnish the information received in response
to such request with respect to an individual (or such
individual's spouse or dependent children) to the
administrator requesting such information pursuant to
subsection (a).
``requirement that employers furnish information
``Sec. 2103. (a) In General.--An employer shall furnish to the
Director the information requested pursuant to section 2102(b)(3)
within 30 days after receipt of such a request.
``(b) Sunset on Requirement.--Subsection (a) shall not apply to
inquiries made after September 30, 1998.
``(c) Civil Money Penalty for Failure to Cooperate.--
``(1) In general.--An employer (other than a Federal or
other governmental entity) who willfully or repeatedly fails to
provide timely and accurate response to a request for
information pursuant to section 2102(b)(3) shall be subject, in
addition to any other penalties that may be prescribed by law,
to a civil money penalty of not to exceed $1,000 for each
individual with respect to whom such a request is made.
``(2) Enforcement authority.--In cases of failure to
respond to the Director in accordance with subsection (a) to
inquiries relating to requests pursuant to section 2102, the
provisions of section 1128A (other than subsections (a) and
(b)) shall apply to civil money penalties under paragraph (1)
in the same manner as such provisions apply to penalties or
proceedings under section 1128A(a).
``data bank
``Sec. 2104. (a) Maintenance of Information.--The Clearinghouse
shall maintain a data bank, containing information on individuals
obtained pursuant to this title. Individual information in the data
bank shall be retained for not less than one year after the date the
information was obtained.
``(b) Disclosure of Information in Data Bank.--
``(1) In general.--The Director is authorized (subject to
paragraph (2)) to disclose any information in the data bank
established pursuant to subsection (a) with respect to an
individual (or an individual's spouse or parent)--
``(A) to the Commissioner of Social Security, the
Secretary of the Treasury, administrators, employers,
and insurers, to the extent necessary to assist such
administrators;
``(B) to Federal and State law enforcement
officials responsible for enforcement of civil or
criminal laws, in connection with investigations or
administrative or judicial law enforcement proceedings
relating to a covered health program; and
``(C) for research or statistical purposes.
``(2) Restrictions on disclosure.--Information in the data
bank may be disclosed under this subsection only for purposes
of, and to the extent necessary in, determining the extent to
which an individual is covered under any group health plan.
``(c) Use of Contractors.--The responsibilities of the
Clearinghouse under this section may be carried out by contract.
``(d) Fees.--The Clearinghouse shall--
``(1) establish fees for services under this section
designed to cover the full costs to the Clearinghouse of
providing such services, and
``(2) require the payment of such fees to provide such
services.''.
(b) Conforming Medicare Amendments.--Section 1862(b)(5) (42 U.S.C.
1395y(b)(5)) is amended--
(1) in subparagraph (A)(i)--
(A) by striking ``Secretary of the Treasury'' and
inserting ``Director of the Health Coverage
Clearinghouse'',
(B) by striking ``(as defined in section
6103(l)(12) of the Internal Revenue Code of 1986)'' and
inserting ``(as defined in clause (iii))'', and
(C) by striking ``and request'' and all that
follows and inserting a period;
(2) in subparagraph (A)(ii)--
(A) by striking ``the Commissioner of the Social
Security Administration'' and all that follows and
inserting ``the Director of the Health Coverage
Clearinghouse to obtain and disclose to the
Administrator, pursuant to section 2102(b) and to
subparagraph (C) of section 6103(l)(12) of the Internal
Revenue Code of 1986, the information described in
section 2102(b) and subparagraph (B) of such section
6103(l)(12).'', and
(B) by inserting ``, pursuant to section 1144(c),''
after ``disclose to the Administrator''; and
(3) by striking subparagraph (C).
(c) Medicaid Use of Clearinghouse.--Section 1902(a)(25)(A) (42
U.S.C. 1396a(a)(25)(A)) is amended by inserting ``(including making
appropriate requests to the Director of the Health Coverage
Clearinghouse under section 2102)'' after ``all reasonable measures''.
(d) Collection of Third Party Payments Under Maternal and Child
Health Block Grant Program.--Section 505(a) (42 U.S.C. 705(a)) is
amended--
(1) by striking ``and'' at the end of paragraph (4),
(2) by striking the period at the end of paragraph (5) and
inserting ``; and'', and
(3) by inserting after paragraph (5) the following new
paragraph:
``(6) provides for an entity providing health services with
assistance from the State under this title taking all
reasonable steps--
``(A) to ascertain the legal liability of third
parties to pay for such services, and
``(B) where such liability is found to exist, to
seek reimbursement for such services.''.
(e) Effective Dates.--
(1) The amendments made by subsections (a), (b), and (d)
shall take effect on April 1, 1995.
(2) The amendments made by subsection (c) shall apply to
allotments for years beginning with fiscal year 1994.
SEC. 5118. MEDICAL CHILD SUPPORT.
(a) State Plan Requirement.--Section 1902(a)(45) (42 U.S.C.
1396a(a)(45)) is amended by striking ``owed to recipients'' and
inserting ``and have in effect laws relating to medical child
support''.
(b) Medical Child Support Laws.--Section 1912 of such Act (42
U.S.C. 1396k) is amended--
(1) by adding at the end of the heading the following: ``;
required laws relating to medical child support''; and
(2) by adding at the end the following new subsection:
``(c) The laws relating to medical child support, which a State is
required to have in effect under section 1902(a)(45), are as follows:
``(1) A law that prohibits an insurer from denying
enrollment of a child under the health coverage of the child's
parent on the ground that the child was born out of wedlock, on
the ground that the child may not be claimed as a dependent on
the parent's Federal income tax return, or on the ground that
the child does not reside with the parent or in the insurer's
service area. In this subsection, the term `insurer' includes a
group health plan, as defined in section 607(1) of the Employee
Retirement Income Security Act of 1974, a health maintenance
organization, and an entity offering a service benefit plan.
``(2) A law that requires an insurer, in any case in which
a parent is required by court or administrative order to
provide health coverage for a child and the parent is eligible
for family health coverage through the insurer--
``(A) to permit such parent, upon application and
without regard to any enrollment season restrictions,
to enroll the parent and such child under such family
coverage;
``(B) if such a parent is enrolled but fails to
make application to obtain coverage of such child, to
enroll such child under such family coverage upon
application by the child's other parent or by the State
agency administering the program under this title or
part D of title IV; and
``(C) not to disenroll (or eliminate coverage of)
such a child unless the insurer is provided
satisfactory written evidence that--
``(i) such court or administrative order is
no longer in effect, or
``(ii) the child is or will be enrolled in
comparable health coverage through another
insurer which will take effect not later than
the effective date of such disenrollment.
``(3) A law that requires an employer doing business in the
State, in the case of health coverage offered through
employment with the employer and providing coverage of a child
of an employee pursuant to a court or administrative order, to
withhold from such employee's compensation the employee's share
(if any) of premiums for health coverage (to the maximum amount
permitted under section 303(b) of the Consumer Credit
Protection Act) and to pay such share of premiums to the
insurer.
``(4) A law that prohibits an insurer from imposing
requirements upon a State agency, which is acting as an agent
or subrogee of an individual eligible for medical assistance
under this title and covered for health benefits from the
insurer, that are different from requirements applicable to an
agent or subrogee of any other individual so covered.
``(5) A law that requires an insurer, in any case in which
a child has health coverage through the insurer of a
noncustodial parent--
``(A) to provide such information to the custodial
parent as may be necessary for the child to obtain
benefits through such coverage;
``(B) to permit the custodial parent (or provider,
with the custodial parent's approval) to submit claims
for covered services without the approval of the
noncustodial parent; and
``(C) to make payment on claims submitted in
accordance with subparagraph (B) directly to the
custodial parent or the provider.
``(6) A law that requires the State agency under this title
to garnish the wages, salary, or other employment income of,
and to withhold amounts from State tax refunds to, any person
who--
``(A) is required by court or administrative order
to provide coverage of the costs of health services to
a child who is eligible for medical assistance under
this title,
``(B) has received payment from a third party for
the costs of such services to such child, but
``(C) has not used such payments to reimburse, as
appropriate, either the other parent or guardian of
such child or the provider of such services,
to the extent necessary to reimburse the State agency for
expenditures for such costs under its plan under this title,
but any claims for current or past-due child support shall take
priority over any such claims for the costs of such
services.''.
(c) Effective Date.--(1) Except as provided in paragraph (2), the
amendments made by this section apply to calendar quarters beginning on
or after April 1, 1994, without regard to whether or not final
regulations to carry out such amendments have been promulgated by such
date.
(2) In the case of a State plan under title XIX of the Social
Security Act which the Secretary of Health and Human Services
determines requires State legislation in order for the plan to meet the
additional requirements imposed by the amendments made by this section,
the State plan shall not be regarded as failing to comply with the
requirements of such title solely on the basis of its failure to meet
these additional requirements before the first day of the first
calendar quarter beginning after the close of the first regular session
of the State legislature that begins after the date of enactment of
this Act. For purposes of the previous sentence, in the case of a State
that has a 2-year legislative session, each year of such session shall
be deemed to be a separate regular session of the State legislature.
PART V--ASSURING PROPER PAYMENTS TO DISPROPORTIONATE SHARE HOSPITALS
SEC. 5121. ASSURING PROPER PAYMENTS TO DISPROPORTIONATE SHARE
HOSPITALS.
(a) Disproportionate Share Hospitals Required to Provide Minimum
Level of Services to Medicaid Patients.--Section 1923 (42 U.S.C. 1396r-
4) is amended--
(1) in subsection (a)(1)(A), by striking ``requirement''
and inserting ``requirements'';
(2) in subsection (b)(1), by striking ``requirement'' and
inserting ``requirements'';
(3) in the heading to subsection (d), by striking
``Requirement'' and inserting ``Requirements'';
(4) by adding at the end of subsection (d) the following
new paragraph:
``(3) No hospital may be defined or deemed as a
disproportionate share hospital under a State plan under this
title or under subsection (b) or (e) of this section unless the
hospital has a medicaid inpatient utilization rate (as defined
in subsection (b)(2)) of not less than 1 percent.'';
(5) in subsection (e)(1)--
(A) by striking ``and'' before ``(B)'', and
(B) by inserting before the period at the end the
following: ``, and (C) the plan meets the requirement
of subsection (d)(3) and such payment adjustments are
made consistent with the fourth sentence of subsection
(c)''; and
(6) in subsection (e)(2)--
(A) in subparagraph (A), by inserting ``(other than
the fourth sentence of subsection (c))'' after ``(c)'',
(B) by striking ``and'' at the end of subparagraph
(A),
(C) by striking the period at the end of
subparagraph (B) and inserting ``, and'', and
(D) by adding at the end the following new
subparagraph:
``(C) subsection (d)(3) shall apply.''.
(b) Limiting Amount of Payment Adjustments for State or County
Hospitals to Uncovered Costs.--Subsection (c) of such section is
amended by adding at the end the following: ``A payment adjustment
during a year is not considered to be consistent with this subsection
with respect to a hospital owned or operated by a State (or by an
instrumentality of or a unit of government within a State) if the
payment adjustment exceeds the costs of furnishing hospital services
(as determined by the Secretary and net of payments under this title,
other than under this section, and by uninsured patients) by the
hospital to individuals who either are eligible for medical assistance
under the State plan or have no health insurance (or other source of
third party payment) for such services during the year. For purposes of
the preceding sentence, payments made to a hospital for services
provided to indigent patients made by a State or a unit of local
government within a State shall not be considered to be a source of
third party payment.''.
(c) Effective Date.--The amendments made by this section shall
apply to payments to States under section 1903(a) of the Social
Security Act for payments to hospitals made under State plans after--
(1) the end of the State fiscal year that ends during 1994,
or
(2) in the case of a State with a State legislature which
is not scheduled to have a regular legislative session in 1994,
the end of the State fiscal year that ends during 1995;
without regard to whether or not final regulations to carry out such
amendments have been promulgated by either such date.
Subchapter B--Miscellaneous Provisions
PART I--ANTI-FRAUD AND ABUSE PROVISIONS
SEC. 5131. APPLICATION OF MEDICARE RULES LIMITING CERTAIN PHYSICIAN
REFERRALS.
(a) In General.--Section 1903(i) (42 U.S.C. 1396b(i)), as amended
by section 5174(b), is amended--
(A) in paragraph (12), by striking or at the end,
(B) in paragraph (13), by striking the period at
the end and inserting ``; or'', and
(C) by inserting after paragraph (13) the following
new paragraph:
``(14) with respect to any amount expended for an item or
service for which payment would be denied under section
1877(g)(1) if the item or service were furnished to an
individual entitled to benefits under title XVIII.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to items and services furnished on or after October 1, 1993.
SEC. 5132. INTERMEDIATE SANCTIONS FOR KICKBACK VIOLATIONS.
(a) Penalty for Kickbacks.--Section 1128A(a) (42 U.S.C. 1320a-
7a(a)) is amended--
(1) by striking ``or'' at the end of paragraphs (1) and
(2);
(2) by adding ``or'' at the end of paragraph (3);
(3) by inserting after paragraph (3) the following new
paragraph:
``(4) carries out any activity in violation of paragraph
(1) or (2) of section 1128B(b);'';
(4) by striking ``given).'' at the end of the first
sentence and inserting ``given or, in cases under paragraph
(4), $50,000 for each such violation).'';
(5) in the second sentence, by inserting ``in cases under
paragraphs (1), (2), and (3),'' after ``In addition,''; and
(6) by inserting after the second sentence, the following
new sentence: ``In cases under paragraph (4), such a person
shall be subject to an assessment of not more than twice the
total amount of the remuneration offered, paid, solicited, or
received in violation of section 1128B(b), determined without
regard to whether a portion of such remuneration was offered,
paid, solicited, or received for a lawful purpose.''.
(b) Authorization To Act.--The first sentence of section
1128A(c)(1) (42 U.S.C. 1320a-7a(c)(1)) is amended by striking all that
follows ``(b)'' and inserting the following: ``unless, within one year
after the date the Secretary presents a case to the Attorney General
for consideration, the Attorney General brings an action in a district
court of the United States.''.
(c) Effective Dates.--
(1) The amendments made by subsection (a) shall apply to
remuneration offered, paid, solicited, or received before, on,
or after the date of the enactment of this Act.
(2) The amendment made by subsection (b) shall apply to
cases presented by the Secretary of Health and Human Services
for consideration on or after the date of the enactment of this
Act.
SEC. 5133. REQUIRING MAINTENANCE OF EFFORT FOR STATE MEDICAID FRAUD
CONTROL UNITS.
(a) In General.--Section 1902(a)(49) (42 U.S.C. 1396a(a)(49)) is
amended--
(1) by inserting ``(A)'' after ``(49)'', and
(2) by adding at the end the following new subparagraph:
``(B) provide that the State will expend for its medicaid
fraud and abuse control unit (as defined in section 1903(q)),
for each State fiscal year, an amount that is not less than the
amount expended for such unit in the State fiscal year that
ended in 1992 adjusted to reflect the percentage increase in
total expenditures under the State plan between such State
fiscal year and the State fiscal year involved;''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to State fiscal years ending after 1993.
PART II--MANAGED CARE PROVISIONS
SEC. 5135. MEDICAID MANAGED CARE ANTI-FRAUD PROVISIONS.
(a) Prohibiting Affiliations With Individuals Debarred by Federal
Agencies.--
(1) In general.--Section 1903(m) (42 U.S.C. 1396b(m)) is
amended--
(A) in paragraph (2)(A)--
(i) by striking ``and'' at the end of
clause (x),
(ii) by striking the period at the end of
clause (xi) and inserting ``; and'', and
(iii) by adding at the end the following
new clause:
``(xii) the entity complies with the requirements of
paragraph (3) (relating to certain protections against fraud
and abuse).'';
(B) in paragraph (2)(B), as amended by section
5158(b), by striking ``clause (ix)'' and inserting
``clauses (ix) and (xii)''; and
(C) by inserting after paragraph (2) the following
new paragraph:
``(3)(A)(i) A health maintenance organization may not have a person
described in clause (iv) as a director, officer, partner, or person
with beneficial ownership of more than 5 percent of organization's
equity.
``(ii) A health maintenance organization may not have an
employment, consulting, or other agreement with a person described in
clause (iv) for the provision of goods and services that are
significant and material to the organization's obligations under its
contract with the State described in paragraph (2)(A)(iii).
``(iii) If a health maintenance organization is not in compliance
with clause (i) or clause (ii)--
``(I) a State may continue an existing agreement with the
organization unless the Secretary (in consultation with the
Inspector General of the Department of Health and Human
Services) directs otherwise; and
``(II) a State may not renew or otherwise extend the
duration of an existing agreement with the organization unless
the Secretary (in consultation with the Inspector General of
the Department of Health and Human Services) provides a written
statement describing compelling reasons that exist for renewing
or extending the agreement.
``(iv) A person described in this clause is a person that--
``(I) is debarred or suspended by the Federal Government,
pursuant to the Federal acquisition regulation, from Government
contracting and subcontracting, or
``(II) is an affiliate (within the meaning of the Federal
acquisition regulation) of a person described in subclause
(I).''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply to agreements between a State and an entity under
section 1903(m) of the Social Security Act entered into or
renewed on or after October 1, 1993, without regard to whether
regulations to carry out such amendments are promulgated by
such date.
(b) Requirement for State Conflict-of-Interest Safeguards in
Medicaid Risk Contracting.--
(1) In general.--Section 1903(m)(2)(A) (42 U.S.C.
1396b(m)(2)(A)), as amended by subsection (a)(1)(C), is
amended--
(A) by striking ``and'' at the end of clause (xi),
(B) by striking the period at the end of clause
(xii) and inserting ``; and'', and
(C) by adding at the end the following new clause:
``(xiii) the State certifies to the Secretary that it has
in effect conflict-of-interest safeguards with respect to
officers and employees of the State with responsibility with
respect to contracts with organizations under this subsection
that are at least as effective as the Federal safeguards,
provided under section 27 of the Office of Federal Procurement
Policy Act (41 U.S.C. 423), against conflicts of interest that
apply with respect to Federal procurement officials with
comparable responsibilities with respect to such contracts.''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply as of July 1, 1994, without regard to whether
regulations to carry out such amendments are promulgated by
such date.
(c) Requiring Disclosure of Financial Information.--
(1) In general.--Section 1903(m)(3), as inserted by
subsection (a)(1)(C), is amended by adding at the end the
following new subparagraph:
``(B) The contract between the State and an entity referred to in
paragraph (2)(A)(iii) shall provide that--
``(i) the entity agrees to report to the State such
financial information as the Secretary or the State may require
to demonstrate that the entity has a fiscally sound operation;
and
``(ii) the entity agrees to make available to its enrollees
upon reasonable request--
``(I) the information reported under paragraph (1),
``(II) the information required to be disclosed
under sections 1124 and 1126, and
``(III) a description of each transaction,
described in subparagraphs (A) through (C) of section
1318(a)(3) of the Public Health Service Act, between
the entity and a party in interest (as defined in
section 1318(b) of such Act).''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to contract years beginning on or after October 1,
1993, without regard to whether regulations to carry out such
amendments are promulgated by such date, with respect to
information reported or required to be disclosed, or
transactions occurring, before, on, or after such date.
(d) Prohibiting Marketing Fraud.--
(1) In general.--Section 1903(m)(3), as inserted by
subsection (a)(1) and as amended by subsection (c)(1), is
amended by adding at the end the following new subparagraph:
``(C) The contract between the State and an entity referred to in
paragraph (2)(A)(iii) shall provide that the entity agrees to comply
with such procedures and conditions as the Secretary prescribes in
order to ensure that, before an individual is enrolled with the entity,
the individual is provided accurate and sufficient information to make
an informed decision whether or not to enroll.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to contract years that begin on or after October 1,
1993, without regard to whether regulations to carry out such
amendment are promulgated by such date.
(e) Requiring Adequate Equity for For-Profit Entities.--
(1) In general.--Section 1903(m)(3), as previously amended
by this section, is further amended by adding at the end the
following new subparagraph:
``(D)(i) The contract between the State and an entity referred to
in paragraph (2)(A)(iii) shall require, in the case of a for-profit
entity, that the entity shall maintain an average ratio of--
``(I) equity capital to
``(II) payments made by the State to the entity under the
contract on a capitation basis or any other risk basis,
of not less than such minimum ratio as the Secretary shall specify.
``(ii) The contract between the State and a non-profit entity
referred to in paragraph (2)(A)(iii) shall require that no payment
shall be made directly or indirectly under an agreement between the
non-profit entity and a related for-profit entity (as defined by the
Secretary) unless the for-profit entity maintains an average ratio of
equity capital to payments under such agreement of not less than such
ratio as the Secretary shall specify.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to contract years beginning on or after July 1,
1994, without regard to whether regulations to carry out such
amendment are promulgated by such date.
(f) Requiring Adequate Provision Against Risk of Insolvency.--
(1) In general.--Section 1903(m)(1)(A)(ii) (42 U.S.C.
1396b(m)(1)(A)(ii)) is amended by inserting ``, which meets
such standards as the Secretary shall prescribe'' after
``satisfactory to the State''.
(2) Effective date and transition.--(A) The amendment made
by paragraph (1) shall apply to contract years beginning on or
after July 1, 1994, without regard to whether regulations to
carry out such amendments are promulgated by such date.
(B) If the Secretary of Health and Human Services has not
promulgated standards to carry out the amendment made by
paragraph (1) by July 1, 1994, until such standards have been
promulgated a provision of a health maintenance organization
against the risk of insolvency shall not be considered to meet
standards prescribed by the Secretary, for purposes of section
1903(m)(1)(A)(ii) of the Social Security Act, unless such
provision has been found satisfactory by the Secretary under
section 1876(b)(2)(E) of such Act.
(g) Requiring Report on Net Earnings and Additional Benefits.--
(1) In general.--Section 1903(m)(3), as previously amended
by this section, is amended by adding at the end the following
new subparagraph:
``(E) The contract between the State and an entity referred to in
paragraph (2)(A)(iii) shall provide that the entity shall submit a
report to the State and the Secretary not later than 12 months after
the close of a contract year containing--
``(i) a financial statement of the entity's net earnings
under the contract during the contract year, which statement
has been audited using auditing standards established by the
Secretary in consultation with the States; and
``(ii) a description of any benefits that are in addition
to the benefits required to be provided under the contract that
were provided during the contract year to members enrolled with
the entity and entitled to medical assistance under the
plan.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to contract years beginning on or after October 1,
1993, without regard to whether regulations to carry out such
amendments are promulgated by such date.
(h) Report on Net Earnings of Contractors.--Not later than 6 months
after the date of the enactment of this Act, the Secretary of Health
and Human Services shall submit a report to Congress on the earnings of
organizations with contracts to receive payment for providing medical
assistance under title XIX of the Social Security Act on a prepaid
capitation or any other risk basis. The report shall include the
Secretary's recommendations on options for requiring such
organizations, as a condition of participation under such title, to
dedicate a portion of such earnings to the provision of additional
benefits to individuals enrolled with the organization.
SEC. 5136. CLARIFICATION OF TREATMENT OF HMO ENROLLEES IN COMPUTING THE
MEDICAID INPATIENT UTILIZATION RATE IN QUALIFYING
HOSPITALS AS DISPROPORTIONATE SHARE HOSPITALS.
(a) In General.--Section 1923(b)(2) (42 U.S.C. 1396r-4(b)(2)) is
amended by inserting before the period at the end the following: ``and
whether or not the individual is enrolled with an entity contracting
with the State on a prepaid capitation basis or other risk basis under
section 1903(m)''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to payments to States under section 1903(a) of the Social
Security Act for payments to hospitals made under State plans on and
after the first day of the first calendar quarter beginning after the
date of the enactment of this Act.
SEC. 5137. EXTENSION OF PERIOD OF APPLICABILITY OF ENROLLMENT MIX
REQUIREMENT TO CERTAIN HEALTH MAINTENANCE ORGANIZATIONS
PROVIDING SERVICES UNDER DAYTON AREA HEALTH PLAN.
Section 2 of Public Law 102-276 is amended by striking ``January
31, 1994'' and inserting ``December 31, 1995''.
SEC. 5138. EXTENSION OF MEDICAID WAIVER FOR TENNESSEE PRIMARY CARE
NETWORK.
Section 6411(f) of the Omnibus Budget Reconciliation Act of 1989,
as amended by section 1 of Public Law 102-317, is amended by striking
``January 31, 1994'' and inserting ``December 31, 1995''.
SEC. 5139. WAIVER OF APPLICATION OF MEDICAID ENROLLMENT MIX REQUIREMENT
TO DISTRICT OF COLUMBIA CHARTERED HEALTH PLAN, INC.
(a) In General.--The Secretary of Health and Human Services shall
waive the application of the requirement described in section
1903(m)(2)(A)(ii) of the Social Security Act to the entity known as the
District of Columbia Chartered Health Plan, Inc., for the period
described in subsection (b), if the Secretary determines that the
entity is making continuous efforts and progress toward achieving
compliance with such requirement.
(b) Period of Applicability.--The period referred to in subsection
(a) is the period that begins on October 1, 1992, and ends on December
31, 1995.
SEC. 5140. EXTENSION OF MINNESOTA PREPAID MEDICAID DEMONSTRATION
PROJECT.
(a) In General.--Section 507 of the Family Support Act of 1988, as
amended by section 6411(j) of OBRA-1989 and by section 4733 of OBRA-
1990, is amended by striking ``1996'' and inserting ``1998''.
(b) Authority to Impose Premium.--
(1) In general.--Notwithstanding section 1916 of the Social
Security Act and subject to paragraph (2), the State of
Minnesota may impose a premium on individuals receiving medical
assistance under the Minnesota Prepaid Demonstration Project
operated under a waiver granted by the Secretary of Health and
Human Services under section 1115(a) of the Social Security Act
and other individuals eligible under the State's plan for
medical assistance under title XIX of such Act.
(2) Limitation on amount of premium.--In no case may the
amount of any premium imposed on an individual receiving
medical assistance under the State plan or under the
Demonstration Project described in paragraph (1) exceed 10
percent of the amount by which the family income (less expenses
for the care of a dependent child) of the individual exceeds
110 percent of the income official poverty line (as defined by
the Office of Management and Budget), and revised annually in
accordance with section 673(2) of the Omnibus Budget
Reconciliation Act of 1981) applicable to a family of the size
involved.
PART III--EMERGENCY SERVICES TO UNDOCUMENTED ALIENS
SEC. 5141. INCREASE IN FEDERAL FINANCIAL PARTICIPATION FOR EMERGENCY
MEDICAL ASSISTANCE TO UNDOCUMENTED ALIENS.
(a) In General.--Section 1905(b) (42 U.S.C. 1396d(b)) is amended by
adding at the end the following: ``Notwithstanding the first sentence
of this section, subject to 1903(v)(4), the Federal medical assistance
percentage shall be 100 per centum with respect to amounts expended by
an eligible State in a covered fiscal year (as defined in section
1903(v)(4)(C)) as medical assistance for care and services described in
section 1903(v)(2) to aliens described in section 1903(v)(1).''.
(b) Limitation.--Section 1903(v) (42 U.S.C. 1396b(v)) is amended by
adding at the end the following new paragraphs:
``(4)(A) With respect to any eligible State (as defined in
subparagraph (C)(i)), the amount of the increase in payments to a State
under subsection (a) in a covered fiscal year (as defined in
subparagraph (C)(ii)), resulting from the increase in the Federal
medical assistance percentage under the fourth sentence of section
1905(b), shall not exceed the State's allotment determined under
subparagraph (B).
``(B)(i) The total of the allotments to all States for a covered
fiscal year under this paragraph shall be $300,000,000.
``(ii) From the total allotment under clause (i) for a covered
fiscal year, the Secretary shall determine the amount of the allotment
for each eligible State. Subject to clause (iii), the amount of such
allotment for such a fiscal year shall bear the same ratio to the total
amount specified in clause (i) for the fiscal year as the ratio of--
``(I) the allotment to the State for fiscal year 1993 under
section 204 of the Immigration Reform and Control Act of 1986,
to
``(II) the total of such allotments for all such eligible
States for fiscal year 1993.
``(iii) In the case of an eligible State which notifies the
Secretary that an amount of its allotment will not be used by the State
under this paragraph, the State's allotment shall be reduced by such
amount and such amount shall be redistributed among the other eligible
States in proportion to the amount otherwise allotted to such State
under clause (ii).
``(C) For purposes of this paragraph and the fourth sentence of
section 1905(b):
``(i) The term `eligible State' means a State--
``(I) with a plan approved under this title
(including a State which is providing medical
assistance to its residents under a statewide waiver
granted under section 1115), and
``(II) for which its allotment for fiscal year 1993
under section 204 of the Immigration Reform and Control
Act of 1986 is at least 1 percent of the total of such
allotments for all the States for fiscal year 1993.
``(ii) The term `covered fiscal year' means only fiscal
year 1994.
``(D) Nothing in this paragraph or the fourth sentence of section
1905(b) shall be construed as establishing entitlement authority
(within the meaning of section 3(9) of the Congressional Budget Act of
1974) for any fiscal year other than a covered fiscal year.''.
SEC. 5142. LIMITING FEDERAL MEDICAID MATCHING PAYMENT TO BONA FIDE
EMERGENCY SERVICES FOR UNDOCUMENTED ALIENS.
(a) In General.--Section 1903(v)(2) (42 U.S.C. 1396b(v)(2)) is
amended--
(1) by striking ``and'' at the end of subparagraph (A),
(2) by striking the period at the end of subparagraph (B)
and inserting ``, and'', and
(3) by adding at the end the following new subparagraph:
``(C) such care and services are not related to an organ
transplant procedure.''.
(b) Effective Date.--(1) Subject to paragraph (2), the amendments
made by subsection (a) shall apply as if included in the enactment of
OBRA-1986.
(2) The Secretary of Health and Human Services shall not disallow
expenditures made for the care and services described in section
1903(v)(2)(C) of the Social Security Act, as added by subsection (a),
furnished before the date of the enactment of this Act.
PART IV--MISCELLANEOUS PROVISIONS
SEC. 5144. INCREASE IN LIMIT ON FEDERAL MEDICAID MATCHING PAYMENTS TO
PUERTO RICO AND OTHER TERRITORIES.
(a) In General.--Paragraphs (1) through (5) of section 1108(c) (42
U.S.C. 1308(c)) are amended to read as follows:
``(1) Puerto Rico shall not exceed (A) $104,000,000 for
fiscal year 1994 and (B) for each succeeding fiscal year the
amount provided in this paragraph for the preceding fiscal year
increased by the percentage increase in the medical care
component of the consumer price index for all urban consumers
(as published by the Bureau of Labor Statistics) for the
twelve-month period ending in March preceding the beginning of
the fiscal year, rounded to the nearest $100,000;
``(2) the Virgin Islands shall not exceed (A) $3,425,000
for fiscal year 1994, and (B) for each succeeding fiscal year
the amount provided in this paragraph for the preceding fiscal
year increased by the percentage increase referred to in
paragraph (1)(B), rounded to the nearest $10,000;
``(3) Guam shall not exceed (A) $3,290,000 for fiscal year
1994, and (B) for each succeeding fiscal year the amount
provided in this paragraph for the preceding fiscal year
increased by the percentage increase referred to in paragraph
(1)(B), rounded to the nearest $10,000;
``(4) Northern Mariana Islands shall not exceed (A)
$990,000 for fiscal year 1994, and (B) for each succeeding
fiscal year the amount provided in this paragraph for the
preceding fiscal year increased by the percentage increase
referred to in paragraph (1)(B), rounded to the nearest
$10,000; and
``(5) American Samoa shall not exceed (A) $1,910,000 for
fiscal year 1994, and (B) for each succeeding fiscal year the
amount provided in this paragraph for the preceding fiscal year
increased by the percentage increase referred to in paragraph
(1)(B), rounded to the nearest $10,000.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply beginning with fiscal year 1994.
SEC. 5145. CRITERIA FOR MAKING DETERMINATIONS OF DENIAL OF FEDERAL
MEDICAID MATCHING PAYMENTS TO STATES.
(a) In General.--Section 1903 (42 U.S.C. 1396b) is amended by
adding at the end the following new subsection:
``(x)(1) In any case in which the Secretary proposes to disallow
under section 1116(d) a claim by a State under this section and the
State exercises its right of reconsideration under section 1116(d), the
Departmental Appeals Board established in the Department of Health and
Human Services shall, if such Board upholds the basis for the
disallowance, determine whether the amount of the disallowance should
be reduced. In making this determination, the Board shall take into
account (to the extent the State makes a showing) factors which shall
include--
``(A) the nature of the basis for the disallowance;
``(B) whether the amount of the disallowance is
proportionate to the error or deficiency on which the
disallowance is based;
``(C) whether the basis of the disallowance constitutes
noncompliance that prevented or materially affected the
provision of appropriate services to individuals eligible under
this title; or
``(D) whether Federal guidance with respect to the action
that is the basis for the proposed disallowance was
insufficient and the State made good faith efforts to conform
its action to the intent of the applicable Federal statute or
regulation.
``(2) No disallowance shall be taken or upheld if the action of the
State on which the disallowance would be based is consistent with its
approved State plan.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to disallowances made after the date of the enactment of this Act
and shall take effect without regard to the promulgation of
implementing regulations.
SEC. 5146. RENEWAL OF UNFUNDED DEMONSTRATION PROJECT FOR LOW-INCOME
PREGNANT WOMEN AND CHILDREN.
(a) In General.--Section 6407 of OBRA-89 is amended--
(1) in subsection (d), by striking ``3 years'' and
inserting ``5 years'';
(2) in subsection (f), by striking ``$10,000,000 in each of
fiscal years 1990, 1991, and 1992'' and inserting
``$30,000,000''; and
(3) in subsection (g)(2), by striking ``January 1, 1994''
and inserting ``one year after the termination of the
demonstration projects''.
(b) Effective Date.--The amendments made by subsection (a) shall
take effect as if included in the enactment of OBRA-89.
SEC. 5147. OPTIONAL MEDICAID COVERAGE OF TB-RELATED SERVICES FOR
CERTAIN TB-INFECTED INDIVIDUALS.
(a) Coverage as Optional, Categorically Needy Group.--Section
1902(a)(10)(A)(ii) (42 U.S.C. 1396a(a)(10)(A)(ii)) is amended--
(1) by striking ``or'' at the end of subclause (X),
(2) by adding ``or'' at the end of subclause (XI), and
(3) by adding at the end the following new subclause:
``(XII) who are described in
subsection (z)(1) (relating to certain
TB-infected individuals);''.
(b) Group and Benefit Described.--Section 1902 is amended by adding
at the end the following new subsection:
``(z)(1) Individuals described in this paragraph are individuals
not described in subsection (a)(10)(A)(i)--
``(A) who have tested positively to be infected with
tuberculosis;
``(B) whose income (as determined under the State plan
under this title with respect to disabled individuals) does not
exceed the maximum amount of income a disabled individual
described in subsection (a)(10)(A)(i) may have and obtain
medical assistance under the plan; and
``(C) whose resources (as determined under the State plan
under this title with respect to disabled individuals) do not
exceed the maximum amount of resources a disabled individual
described in subsection (a)(10)(A)(i) may have and obtain
medical assistance under the plan.
``(2) For purposes of subsection (a)(10), the term `TB-related
services' means each of the following services relating to treatment of
infection with tuberculosis:
``(A) Prescribed drugs.
``(B) Physicians' services and services described in
section 1905(a)(2).
``(C) Laboratory and X-ray services.
``(D) Clinic services and Federally-qualified health center
services.
``(E) Case management services (as defined in section
1915(g)(2)).
``(F) Services (other than room and board) designed to
encourage completion of regimens of prescribed drugs by
outpatients, including services to observe directly the intake
of prescribed drugs.''.
(c) Limitation on Benefits.--Section 1902(a)(10), as amended by
section 5162(a), is amended, in the matter following subparagraph (F)--
(1) by striking ``, and (XII)'' and inserting ``, (XII)'',
and
(2) by inserting before the semicolon at the end the
following: ``, and (XIII) the medical assistance made available
to an individual described in subsection (z)(1) who is eligible
for medical assistance only because of subparagraph
(A)(ii)(XII) shall be limited to medical assistance for TB-
related services (as defined in subsection (z)(2))''.
(d) Conforming Expansion of Case Management Services Option.--
Section 1915(g)(1) (42 U.S.C. 1396n(g)(1)) is amended by inserting ``or
to individuals described in section 1902(z)(1)(A),'' after ``or with
either,''.
(e) Conforming Amendment.--Section 1905(a) (42 U.S.C. 1396d(a)) is
amended--
(1) by striking ``or'' at the end of clause (ix),
(2) by adding ``or'' at the end of clause (x),
(3) by inserting after clause (x) the following new clause:
``(xi) individuals described in section 1902(z)(1),'', and
(4) by amending paragraph (19) to read as follows:
``(19) case management services (as defined in section
1915(g)(2)) and TB-related services described in section
1902(z)(2)(F);''.
(f) Effective Date.--The amendments made by this section shall
apply to medical assistance furnished on or after January 1, 1994,
without regard to whether or not final regulations to carry out such
amendments have been promulgated by such date.
SEC. 5148. APPLICATION OF MAMMOGRAPHY CERTIFICATION REQUIREMENTS UNDER
THE MEDICAID PROGRAM.
(a) In General.--Section 1902(a)(9) (42 U.S.C. 1396a(a)(9)) is
amended--
(1) by striking ``and'' at the end of subparagraph (B),
(2) by striking the semicolon at the end of subparagraph
(C) and inserting ``, and'', and
(3) by adding at the end the following new subparagraph:
``(D) that any mammography paid for under such plan
must be conducted by a facility that has a certificate
(or provisional certificate) issued under section 354
of the Public Health Service Act;''.
(b) Effective Date.--(1) Except as provided in paragraph (2), the
amendments made by subsection (a) shall apply to mammography furnished
by a facility during calendar quarters beginning on or after the first
date that the certificate requirements of section 354(b) of the Public
Health Service Act apply to such mammography conducted by such
facility, without regard to whether or not final regulations to carry
out such amendments have been promulgated by such date.
(2) In the case of a State plan for medical assistance under title
XIX of the Social Security Act which the Secretary of Health and Human
Services determines requires State legislation (other than legislation
appropriating funds) in order for the plan to meet the additional
requirement imposed by the amendment made by subsection (a)(3), the
State plan shall not be regarded as failing to comply with the
requirements of such title solely on the basis of its failure to meet
this additional requirement before the first day of the first calendar
quarter beginning after the close of the first regular session of the
State legislature that begins after the date of the enactment of this
Act. For purposes of the previous sentence, in the case of a State that
has a 2-year legislative session, each year of such session shall be
deemed to be a separate regular session of the State legislature.
SEC. 5149. REMOVAL OF SUNSET ON EXTENSION OF ELIGIBILITY FOR WORKING
FAMILIES.
Subsection (f) of section 1925 (42 U.S.C. 1396r-6) is repealed.
SEC. 5150. EXTENSION OF MORATORIUM ON TREATMENT OF CERTAIN FACILITIES
AS INSTITUTIONS FOR MENTAL DISEASES.
Effective as if included in the enactment of OBRA-1989, section
6408(a)(3) of such Act is amended by striking ``180 days'' and all that
follows and inserting ``December 31, 1995.''.
SEC. 5150A. TREATMENT OF CERTAIN CLINICS AS FEDERALLY-QUALIFIED HEALTH
CENTERS.
(a) In General.--Section 1905(l)(2)(B) (42 U.S.C. 1396d(l)(2)(B)),
as amended by section 5158(c), is amended--
(1) by striking ``or'' at the end of clause (ii)(II),
(2) by adding ``or'' at the end of clause (iii), and
(3) by inserting after clause (iii) the following new
clause:
``(iv) was treated by the Secretary, for purposes of part B
of title XVIII, as a comprehensive Federally funded health
center as of January 1, 1990;''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to calendar quarters beginning on or after July 1, 1993.
SEC. 5150B. NURSING HOME REFORM.
(a) Suspension of Decertification of Nurse Aide Training and
Competency Evaluation Programs Based on Extended Surveys.--
(1) In general.--Section 1919(f)(2)(B)(iii)(I)(b) (42
U.S.C. 1396r(f)(2)(B)(iii)(I)(b)) is amended by striking the
semicolon and inserting the following: ``, unless the survey
shows that the facility is in compliance with the requirements
of subsections (b), (c), and (d) of this section;''.
(2) Effective date.--The amendment made by paragraph (1)
shall take effect as included in the enactment of OBRA-1990.
(b) Requirements for Consultants Conducting Reviews of use of
Drugs.--
(1) In general.--Section 1919(c)(1)(D) (42 U.S.C.
1396r(c)(1)(D)) is amended by adding at the end the following
sentence: ``In determining whether such a consultant is
qualified to conduct reviews under the previous sentence, the
Secretary shall take into account the needs of nursing
facilities under this title to have access to the services of
such a consultant on a timely basis.''.
(2) Effective date.--The amendment made by paragraph (1)
shall take effect as included in the enactment of OBRA-1987.
(c) Increase in Minimum Amount Required for Separate Deposit of
Personal Funds.--
(1) In general.--Section 1919(c)(6)(B)(i) (42 U.S.C.
1396r(c)(6)(B)(i)) is amended by striking ``$50'' and inserting
``$100''.
(2) Effective date.--The amendment made by paragraph (1)
shall take effect October 1, 1993.
(d) Due Process Protections for Nurse Aides.--
(1) Prohibiting state from including undocumented
allegations in nurse aide registry.--Section 1919(e)(2)(B) (42
U.S.C. 1396r(e)(2)(B)) is amended by striking the period at the
end of the first sentence and inserting the following: ``, but
shall not include any allegations of resident abuse or neglect
or misappropriation of resident property that are not
specifically documented by the State under such subsection.''.
(2) Due process requirements for rebutting allegations.--
Section 1919(g)(1)(C) (42 U.S.C. 1396r(g)(1)(C)) is amended by
striking the second sentence and inserting the following: ``The
State shall, after providing the individual involved with a
written notice of the allegations (including a statement of the
availability of a hearing for the individual to rebut the
allegations) and the opportunity for a hearing on the record,
make a written finding as to the accuracy of the
allegations.''.
(3) Effective date.--The amendments made by this subsection
shall take effect October 1, 1993.
Subchapter C--Miscellaneous and Technical Corrections Relating to OBRA-
1990
SEC. 5151. EFFECTIVE DATE.
Except as otherwise provided, the amendments made by this
subchapter shall take effect as if included in the enactment of OBRA-
1990.
SEC. 5152. CORRECTIONS RELATING TO SECTION 4402 (ENROLLMENT UNDER GROUP
HEALTH PLANS).
Section 4402(b) of OBRA-1990 is amended by striking
``1903(u)(1)(C)(iv) (42 U.S.C. 1396b(u)(1)(C)(iv))'' and inserting
``1903(u)(1)(D)(iv) (42 U.S.C. 1396b(u)(1)(D)(iv))''.
SEC. 5153. CORRECTIONS RELATING TO SECTION 4501 (LOW-INCOME MEDICARE
BENEFICIARIES).
(a) Section 1902(a)(10)(E)(iii), as added by section 4501(b)(3) of
OBRA-1990, is amended by striking ``cost sharing'' and inserting
``cost-sharing''.
(b) Section 1905(p)(4)(B), as amended by section 4501(c)(1) of
OBRA-1990, is amended by striking ``1902(a)(10)(E)(iii)'' and inserting
``section 1902(a)(10)(E)(iii)''.
SEC. 5154. CORRECTIONS RELATING TO SECTION 4601 (CHILD HEALTH).
(a) Section 1902(a)(10)(A)(i)(VII), as added by section
4601(a)(10)(A)(iii) of OBRA-1990, is amended by striking ``family;''
and inserting ``family; and''.
(b) Section 1902(l), as amended by section 4601(a)(1)(C) of OBRA-
1990, is amended--
(1) in paragraph (1)(C), by striking ``children'' after
``(C)'';
(2) in paragraph (3), by striking ``(a)(10)(A)(i)(VII),,''
and inserting ``(a)(10)(A)(i)(VII),''; and
(3) in paragraph (4)(B), by inserting a comma before
``(a)(10)(A)(i)(VI),''.
(c) Subsections (a)(3)(C) and (b)(3)(C)(i) of section 1925, as
amended by section 4601(a) of OBRA-1990, are each amended by striking
``(i)(VI)'' and inserting ``(i)(VI),''.
SEC. 5155. CORRECTIONS RELATING TO SECTION 4602 (OUTREACH LOCATIONS).
(a) Section 1902(a)(55), as added by section 4602(a)(3) of OBRA-
1990, is amended--
(1) in the matter preceding subparagraph (A)--
(A) by striking ``subsection'' and inserting
``paragraph'', and
(B) by striking ``(a)'' each place it appears; and
(2) in subparagraph (A), by striking ``1905(1)(2)(B)'' and
inserting ``1905(l)(2)(B)''.
(b) Section 1902(l)(1) is amended by striking ``who are not
described in any of subclauses (I) through (III) of subsection
(a)(10)(A)(i) and''.
SEC. 5156. CORRECTIONS RELATING TO SECTION 4604 (PAYMENT FOR HOSPITAL
SERVICES FOR CHILDREN UNDER 6 YEARS OF AGE).
(a) Section 1902(a)(10) is amended in clause (X) in the matter
following subparagraph (F) by striking ``under one year of age'' and
inserting ``under 6 years of age''.
(b) Section 1902(s), as added by section 4604(a) of OBRA-1990, is
amended to read as follows:
``(s) In order to meet the requirements of subsection (a)(56), the
State plan must provide that payments to hospitals under the plan for
inpatient services furnished to infants who have not attained the age
of 1 year (or, in the case of such an individual who is an inpatient on
his first birthday, until such individual is discharged) shall--
``(1) if made on a prospective basis (whether per diem, per
case, or otherwise) provide for an outlier adjustment in
payment amounts for medically necessary inpatient hospital
services involving exceptionally high costs or exceptionally
long lengths of stay;
``(2) not be limited by the imposition of day limits; and
``(3) not be limited by the imposition of dollar limits
(other than dollar limits resulting from prospective payments
as adjusted pursuant to paragraph (1)).''.
(c) Section 1923(a)(2)(C) is amended by striking ``provided on or
after July 1, 1989,'' and all that follows and inserting the following:
``involving exceptionally high costs or exceptionally long lengths of
stay--
``(i) for individuals under 1 year of age, in the case of
services provided on or after July 1, 1989, and on or before
June 30, 1991; and
``(ii) for individuals under 6 years of age, in the case of
services provided on or after July 1, 1991.''.
SEC. 5157. CORRECTIONS RELATING TO SECTION 4703 (PAYMENT ADJUSTMENTS
FOR DISPROPORTIONATE SHARE HOSPITALS).
(a) Section 1923(c) is amended--
(1) in paragraph (2), by striking ``paragraph (b)(3)'' and
inserting ``subsection (b)(3)'';
(2) by striking the period at the end of paragraph (3)(B)
and inserting a comma; and
(3) in the third sentence, by striking ``the payment
adjustment described in paragraph (2)'' and inserting ``a
payment adjustment described in paragraph (2) or (3)''.
(b) Effective December 22, 1987, section 1923(d)(2)(A)(ii) is
amended by striking ``the date of the enactment of this Act'' and
inserting ``December 22, 1987''.
(c) Section 4703(d) of OBRA-1990 is amended by striking
``412(a)(2)'' and inserting ``4112(a)(2)''.
SEC. 5158. CORRECTIONS RELATING TO SECTION 4704 (FEDERALLY-QUALIFIED
HEALTH CENTERS).
(a) Clause (ix) of section 1903(m)(2)(A), as added by section
4704(b)(1)(C) of OBRA-1990, is amended--
(1) by striking ``of such center'' the first place it
appears;
(2) by striking ``federally qualified'' and inserting
``Federally-qualified'';
(3) by inserting ``section'' before ``1905(a)(2)(C)''; and
(4) by moving such clause 2 ems to the left.
(b) Section 1903(m)(2)(B), as amended by section 4704(b)(2) of
OBRA-1990, is amended by striking ``except with respect to clause (ix)
of subparagraph (A),'' and inserting ``(except with respect to clause
(ix) of such subparagraph)''.
(c) Section 1905(l)(2), as amended by section 4704(c) of OBRA-1990,
is amended--
(1) in subparagraph (A)--
(A) by striking ``Federally-qualififed'' and
inserting ``Federally-qualified'', and
(B) by striking ``an patient'' and inserting ``a
patient''; and
(2) in subparagraph (B)--
(A) in the matter preceding clause (i), by striking
``a entity'' and inserting ``an entity'',
(B) by striking ``or'' at the end of clause (i),
(C) by striking the semicolon at the end of clause
(ii)(II) and inserting ``, or'',
(D) by moving clause (ii) 4 ems to the left, and
(E) in the last sentence, by striking ``clause
(ii)'' and inserting ``clause (iii)''.
SEC. 5159. CORRECTIONS RELATING TO SECTION 4708 (SUBSTITUTE
PHYSICIANS).
Section 1902(a)(32)(C), as added by section 4708(a)(3) of OBRA-
1990, is amended to read as follows:
``(C) payment may be made to a physician for
physicians' services (and services furnished incident
to such services) furnished by a second physician to
patients of the first physician if (i) the first
physician is unavailable to provide the services; (ii)
the services are furnished pursuant to an arrangement
between the two physicians that (I) is informal and
reciprocal, or (II) involves per diem or other fee-for-
time compensation for such services; (iii) the services
are not provided by the second physician over a
continuous period of more than 60 days; and (iv) the
claim form submitted to the carrier for such services
includes the second physician's unique identifier
(provided under the system established under subsection
(x)) and indicates that the claim meets the
requirements of this clause for payment to the first
physician.''.
SEC. 5160. CORRECTIONS RELATING TO SECTION 4711 (HOME AND COMMUNITY
CARE FOR FRAIL ELDERLY).
(a) Section 1929, as added by section 4711(b) of OBRA-1990, is
amended--
(1) in subsection (c)(2)(F), by moving the second sentence
2 ems to the right;
(2) in subsection (d)(2)(F)(ii), by striking ``they
manage'' and inserting ``it manages'';
(3) in subsection (d)(2)(F)(iii), by inserting ``the agency
or organization'' after ``(iii)'';
(4) in subsection (e)(2)(B), by striking ``fiscal year
1989'' and inserting ``fiscal year 1990'';
(5) in subsection (f)(1), by striking ``Community care''
and inserting ``community care'';
(6) in subsection (g)(1)--
(A) by striking ``settings'' and inserting
``setting'', and
(B) in subparagraph (B), by striking ``setting.''
and inserting ``setting in which home and community
care under this section is provided.'';
(7) in subsection (g)(2), by striking ``community care''
the second, third, and fourth places it appears and inserting
``home and community care'';
(8) in subsection (h)(1)--
(A) by striking ``more than 8'' each place it
appears and inserting ``8 or more'', and
(B) in subparagraph (B), by inserting ``(other than
merely board)'' after ``personal services'';
(9) in subsection (h)(2), by striking ``community care''
the second and third places it appears and inserting ``home and
community care'';
(10) in subsection (j)(1)--
(A) in subparagraph (B)(ii), by striking ``1990''
and inserting ``1991'', and
(B) by adding at the end the following new
subparagraph:
``(C) Applicability to community care settings.--
Subparagraphs (A) and (B) shall apply to community care
settings in the same manner as such subparagraphs apply
to providers of home or community care.'';
(11) in subsection (j)(2), by adding at the end the
following new subparagraph:
``(D) Applicability to community care settings.--
Subparagraphs (A), (B), and (C) shall apply to
community care settings in the same manner as such
subparagraphs apply to providers of home or community
care.'';
(12) in subsection (k)(1)(A)(i)--
(A) by striking ``(d)(2)(E)'' and inserting
``(d)(2)'', and
(B) by striking ``settings,'' and inserting
``settings),'';
(13) in subsection (l), by striking ``State wideness'' and
inserting ``Statewideness'';
(14) in subsection (m)--
(A) in paragraph (2), by striking ``Individual
Community Care Plan'' and inserting ``individual
community care plan'',
(B) in paragraph (3), by striking ``and need for
services'' and inserting ``need for services, and
income'',
(C) in the second sentence in paragraph (4), by
striking ``elderly individuals'' and all that follows
and inserting ``individuals receiving home and
community care under this section who reside in such
State in relation to the total number of individuals
receiving home and community care under this
section.'', and
(D) by adding at the end the following new
paragraph:
``(5) Notice to states of amounts available for
assistance.--
``(A) Notice to secretary.--In order to receive
Federal medical assistance for expenditures for home
and community care under this section for a fiscal year
(beginning with fiscal year 1994), a State shall submit
a notice to the Secretary of its intention to provide
such care under this section not later than 3 months
before the beginning of the fiscal year.
``(B) Notice to states.--Not later than 2 months
before the beginning of each fiscal year (beginning
with fiscal year 1994), the Secretary shall notify each
State that has submitted a notice to the Secretary
under subparagraph (A) for the fiscal year of the
amount of Federal medical assistance that will be
available to the State for the fiscal year (as
established under paragraph (4)).''; and
(15) by adding at the end the following new subsection:
``(n) Community Care Setting Defined.--In this section, the term
`community care setting' means a small community care setting (as
defined in subsection (g)(1)) or a large community care setting (as
defined in subsection (h)(1)).''.
(b) Section 1905(r)(5) is amended by striking ``1905(a)'' and
inserting ``subsection (a) (other than services described in paragraph
(22) or (23) of such subsection)''.
(c) Section 4711(f) of OBRA-1990 is amended by striking ``Act''
each place it appears and inserting ``section''.
SEC. 5161. CORRECTIONS RELATING TO SECTION 4712 (COMMUNITY SUPPORTED
LIVING ARRANGEMENTS SERVICES).
(a) Section 1930, as added by section 4712(b)(2) of OBRA-1990, is
amended--
(1) in subsection (b)--
(A) by striking ``title the term,'' and inserting
``title, the term'',
(B) by striking ``guardian'' and inserting
``guardian or'', and
(C) by striking ``3 other'' and inserting ``3'';
(2) in subsection (d)--
(A) in the matter preceding paragraph (1), by
striking ``program,'' and inserting ``program'', and
(B) in the second sentence, by striking ``plan''
each place it appears and inserting ``program''; and
(3) in subsection (i), by striking ``funds'' and inserting
``Funds''.
(b) Section 4712(c) of OBRA-1990 is amended--
(1) in paragraph (1), by inserting ``of section 1930 of the
Social Security Act'' after ``subsection (h)''; and
(2) in paragraph (2), by striking ``this section'' and
inserting ``such section''.
SEC. 5162. CORRECTION RELATING TO SECTION 4713 (COBRA CONTINUATION
COVERAGE).
(a) Section 1902(a)(10) is amended in the matter following
subparagraph (F)--
(1) by striking ``; and (XI)'' and inserting ``, (XI)'';
(2) by striking ``individuals, and (XI)'' and inserting
``individuals, and (XII)''; and
(3) by striking ``COBRA continuation premiums'' and
inserting ``COBRA premiums''.
(b) Section 1902(u)(3), as added by section 4713(a)(2) of OBRA-
1990, is amended by striking ``title VI'' and inserting ``part 6 of
subtitle B of title I''.
SEC. 5163. CORRECTION RELATING TO SECTION 4716 (MEDICAID TRANSITION FOR
FAMILY ASSISTANCE).
Section 4716(a) of OBRA-1990 is amended by striking ``Amendments.--
Subsection (f) of section'' and inserting ``In General.--Section''.
SEC. 5164. CORRECTIONS RELATING TO SECTION 4723 (MEDICAID SPENDDOWN
OPTION).
Section 1903(f)(2), as amended by section 4723(a) of OBRA-1990, is
amended--
(1) by striking ``(A)'' after ``(2)'';
(2) by striking ``or, (B)'' and inserting ``. There shall
also be excluded,'';
(3) by striking ``to the State, provided that'' and
inserting ``to the State if''; and
(4) by striking ``pursuant to this subparagraph.'' and
inserting ``pursuant to the previous sentence''.
SEC. 5165. CORRECTIONS RELATING TO SECTION 4724 (OPTIONAL STATE
DISABILITY DETERMINATIONS).
Section 1902(v), as added by section 4724 of OBRA-1990, is
amended--
(1) by striking ``(v)(1)'' and inserting ``(v)''; and
(2) by striking ``of the Social Security Act''.
SEC. 5166. CORRECTION RELATING TO SECTION 4732 (SPECIAL RULES FOR
HEALTH MAINTENANCE ORGANIZATIONS).
Section 1903(m)(2)(F)(i), as amended by section 4732(b)(2)(B) of
OBRA-1990, is amended by striking ``or'' before ``with an eligible
organization''.
SEC. 5167. CORRECTIONS RELATING TO SECTION 4741 (HOME AND COMMUNITY-
BASED WAIVERS).
The first sentence of section 1915(d)(3) is amended by striking the
period at the end and inserting the following: ``, and a waiver of the
requirements of section 1902(a)(23) (relating to choice of providers)
insofar as such requirements relate to the provision of case management
services and the State provides assurances satisfactory to the
Secretary that a waiver of such requirements will not substantially
limit access to such services).''
SEC. 5168. CORRECTIONS RELATING TO SECTION 4744 (FRAIL ELDERLY
WAIVERS).
(a) Section 1924(a)(5), as added by section 4744(b)(1) of OBRA-
1990, is amended by striking ``1986.'' and inserting ``1986 or a waiver
under section 603(c) of the Social Security Amendments of 1983.''.
(b) Section 603(c) of the Social Security Amendments of 1983 is
amended--
(1) by striking ``(c)'' and inserting ``(c)(1)'';
(2) by redesignating paragraphs (1) and (2) as
subparagraphs (A) and (B); and
(3) by adding at the end the following new paragraph:
``(2) Section 1924 of the Social Security Act shall apply to any
individual receiving services from an organization receiving a waiver
under this subsection.''.
SEC. 5169. CORRECTIONS RELATING TO SECTION 4747 (COVERAGE OF HIV-
POSITIVE INDIVIDUALS).
Section 4747 of OBRA-1990 is amended--
(1) in subsection (a), by striking ``subsection (c)'' and
inserting ``subsection (b)'';
(2) in subsection (b)(2)--
(A) by striking ``preventative'' each place it
appears and inserting ``preventive'', and
(B) by adding a period at the end of subparagraph
(J);
(3) in subsection (c)(1)--
(A) by striking ``subsection (c)'' and inserting
``subsection (b)'', and
(B) by striking ``paragraphs (1) and (2) of''; and
(4) in subsection (d)--
(A) by striking ``paragraph (3)'' and inserting
``subsection (b)'', and
(B) by striking ``paragraph (1)'' and inserting
``subsection (a)''.
SEC. 5170. CORRECTION RELATING TO SECTION 4751 (ADVANCE DIRECTIVES).
Section 1903(m)(1)(A), as amended by section 4751(b)(1) of OBRA-
1990, is amended--
(1) by striking ``1902(w)'' and inserting ``1902(w) and'';
and
(2) by striking ``1902(a)'' and inserting ``1902(w)''.
SEC. 5171. CORRECTIONS RELATING TO SECTION 4752 (PHYSICIANS' SERVICES).
(a) The paragraph (58) of section 1902(a) added by section
4752(c)(1)(C) of OBRA-1990 is amended by striking ``subsection (v)''
and inserting ``subsection (x)''.
(b) Subparagraphs (A) and (B) of the paragraph (14) of section
1903(i) added by section 4752(e)(2) of OBRA-1990 are each amended--
(1) by striking ``or'' at the end of clause (v);
(2) by redesignating clause (vi) as clause (vii); and
(3) by inserting after clause (v) the following new clause:
``(vi) delivers such services in the
emergency department of a hospital
participating in the state plan approved under
this title, or''.
SEC. 5172. CORRECTIONS RELATING TO SECTION 4801 (NURSING HOME REFORM).
(a) Section 1919(b)(3)(C)(i)(I), as amended by section 4801(e)(3)
of OBRA-1990, is amended by striking ``no later than'' before ``not to
exceed 14 days''.
(b) Section 1919(b)(5)(D), as amended by section 4801(a)(4) of
OBRA-1990, is amended by striking the comma before ``or a new
competency evaluation program.''.
(c) Section 1919(b)(5)(G) is amended by striking ``or licensed or
certified social worker'' and inserting ``licensed or certified social
worker, registered respiratory therapist, or certified respiratory
therapy technician''.
(d) Section 1919(f)(2)(B)(i) is amended by striking ``facilities,''
and inserting ``facilities (subject to clause (iii)),''.
(e) Section 1919(f)(2)(B)(iii)(I)(c) is amended by striking
``clauses'' each place it appears and inserting ``clause''.
(f) Section 1919(g)(5)(B) is amended by striking ``paragraphs'' and
inserting ``paragraph''.
(g) Section 4801(a)(6)(B) of OBRA-1990 is amended--
(1) by striking ``The amendments'' and inserting ``(i) The
amendments'';
(2) by redesignating clauses (i) through (v) as subclauses
(I) through (V); and
(3) by adding at the end the following new clause:
``(ii) Notwithstanding clause (i) and subject to
section 1919(f)(2)(B)(iii) of the Social Security Act
(as amended by subparagraph (A)), a State may approve a
training and competency evaluation program or a
competency evaluation program offered by or in a
nursing facility described in clause (i) if, during the
previous 2 years, none of the subclauses of clause (i)
applied to the facility.''.
SEC. 5173. OTHER TECHNICAL CORRECTIONS.
(a) Section 1905(o)(1)(A) is amended--
(1) in the first sentence, by striking ``intermediate care
facility services'' and inserting ``for nursing facility
services or intermediate care facility services for the
mentally retarded''; and
(2) in the second sentence, by striking ``or intermediate
care facility'' and inserting ``(for purposes of title XVIII),
a nursing facility, or an intermediate care facility for the
mentally retarded''.
(b) Section 1915(d) is amended--
(1) by striking ``skilled nursing facility or intermediate
care facility'' each place it appears in paragraphs (1),
(2)(B), and (2)(C) and inserting ``nursing facility'';
(2) in paragraph (2)(B)(i), by striking ``skilled nursing
or intermediate care facility'' and inserting ``nursing
facility'';
(3) in paragraph (5)(A), by striking ``under'' the second
place it appears and inserting ``(or, in the case of waiver
years beginning on or after October 1, 1990, with respect to
nursing facility services and home and community-based
services) under''; and
(4) in paragraph (5)(B)--
(A) in clause (i), by striking ``furnished'' and
inserting ``(or, with respect to waiver years beginning
on or after October 1, 1990, for nursing facility
services) furnished''; and
(B) in clause (iii)(I), by striking ``(regardless''
and inserting ``(or, with respect to waiver years
beginning on or after October 1, 1990, which comprise
nursing facility services) (regardless''.
SEC. 5174. CORRECTIONS TO DESIGNATIONS OF NEW PROVISIONS.
(a) Paragraphs Added to Section 1902(a).--Section 1902(a) is
amended--
(1) by striking ``and'' at the end of paragraph (54);
(2) in the paragraph (55) inserted by section 4602(a)(3) of
OBRA-1990, by striking the period at the end and inserting a
semicolon;
(3) by redesignating the paragraph (55) inserted by section
4604(b)(3) of OBRA-1990 as paragraph (56), by transferring and
inserting it after the paragraph (55) inserted by section
4602(a)(3) of such Act, and by striking the period at the end
and inserting a semicolon;
(4) by placing paragraphs (57) and (58), inserted by
section 4751(a)(1)(C) of OBRA-1990, immediately after paragraph
(56), as redesignated by paragraph (3);
(5) in the paragraph (58) inserted by section 4751(a)(1)(C)
of OBRA-1990, by striking the period at the end and inserting
``; and''; and
(6) by redesignating the paragraph (58) inserted by section
4752(c)(1)(C) of OBRA-1990 as paragraph (59) and by
transferring and inserting it after the paragraph (58) inserted
by section 4751(a)(1)(C) of such Act.
(b) Paragraphs Added to Section 1903(i).--Section 1903(i), as
amended by section 2(b)(2) of the Medicaid Voluntary Contribution and
Provider-Specific Tax Amendments of 1991, is amended--
(1) in the paragraph (10) inserted by section 4401(a)(1)(B)
of OBRA-1990, by striking all that follows ``1927(g)'' and
inserting a semicolon;
(2) by redesignating the paragraph (12) inserted by section
4752(a)(2) of OBRA-1990 as paragraph (11), by transferring and
inserting it after the paragraph (10) inserted by section
4401(a)(1)(B) of OBRA-1990, and by striking the period at the
end and inserting a semicolon;
(3) by redesignating the paragraph (14) inserted by section
4752(e) of OBRA-1990 as paragraph (12), by transferring and
inserting it after paragraph (11), as redesignated by paragraph
(2), and by striking the period at the end and inserting ``;
or''; and
(4) by redesignating the paragraph (11) inserted by section
4801(e)(16)(A) of OBRA-1990 as paragraph (13) and by
transferring and inserting it after paragraph (12), as
redesignated by paragraph (3).
(c) Paragraphs Added to Section 1905(a).--
(1) In general.--Section 1905(a) is amended--
(A) by striking ``and'' at the end of paragraph
(21);
(B) in paragraph (24), by striking the period at
the end and inserting ``; and''; and
(C) by redesignating paragraphs (22), (23), and
(24) as paragraphs (24), (22), and (23), respectively,
and by transferring and inserting paragraph (24) after
paragraph (23), as so redesignated.
(2) Conforming amendments.--(A) Effective July 1, 1991,
section 1902(a)(10)(C)(iv), as amended by section 4755(c)(1)(A)
of OBRA-1990, is amended by striking ``through (21)'' and
inserting ``through (23)''.
(B) Effective July 1, 1991, section 1902(j), as amended by
section 4711(d)(1) of OBRA-1990, is amended by striking
``through (22)'' and inserting ``through (24)''.
(d) Final Sections.--Section 1928, as redesignated by section
4401(a)(3) of OBRA-1990, is amended--
(1) by transferring such section to the end of title XIX of
the Social Security Act; and
(2) by redesignating such section as section 1931.
CHAPTER 2--UNIVERSAL ACCESS TO CHILDHOOD IMMUNIZATIONS
SEC. 5181. ESTABLISHMENT OF ENTITLEMENT AND MONITORING PROGRAMS WITH
RESPECT TO CHILDHOOD IMMUNIZATIONS.
(a) In General.--Title XXI of the Public Health Service Act (42
U.S.C. 300aa-1 et seq.) is amended by adding at the end the following
subtitle:
``Subtitle 3--Entitlement and Monitoring Programs With Respect to
Childhood Immunizations
``PART A--ENTITLEMENT PROGRAM
``SEC. 2151. DELIVERY TO STATES OF SUFFICIENT QUANTITIES OF PEDIATRIC
VACCINES.
``(a) In General.--In the case of any State that submits to the
Secretary an application in accordance with section 2157, the
Secretary, acting through the Director of the Centers for Disease
Control and Prevention, shall provide for the purchase and delivery on
behalf of the State of such quantities of pediatric vaccines as may be
necessary for the immunization of each eligible child in the State. The
preceding sentence is subject to sections 2152(d) and 2159(a).
``(b) Eligible Children.--For purposes of this part, the term
`eligible child' means an individual 18 years of age or younger who--
``(1) with respect to the State involved, is entitled to
medical assistance under the plan approved for the State under
title XIX of the Social Security Act (including a State
operating under a statewide waiver under section 1115 of such
Act);
``(2)(A) is uninsured with respect to health insurance
policies or plans (including group health plans or prepaid
health plans and including employee welfare benefit plans under
the Employee Retirement Income Security Act of 1974); or
``(B) is covered under such a policy or plan, but under the
policy or plan benefits are not available with respect to
immunizations; or
``(3) is an Indian.
``SEC. 2152. ENTITLEMENTS.
``(a) Entitlement of States.--Subject to subsection (d), in the
case of any State that submits to the Secretary an application in
accordance with section 2157, the State is entitled to have the
Secretary provide for the purchase and delivery on behalf of the State
of pediatric vaccines under section 2151. The preceding sentence
constitutes budget authority in advance of appropriations Acts, and
represents the obligation of the Federal Government to provide for the
purchase and delivery to the State of the vaccines.
``(b) Entitlements of Children and Health Care Providers.--Subject
to subsection (d), the Secretary may provide for the purchase and
delivery of pediatric vaccines under section 2151 on behalf of a State
only if the State agrees as follows:
``(1) Each eligible child in the State, in receiving an
immunization with a pediatric vaccine from a program-registered
provider (as defined in section 2153(a)), is entitled to
receive the immunization without charge for the cost of such
vaccine.
``(2) Each program-registered provider in the State who
administers a pediatric vaccine to an eligible child in the
State is entitled to receive such vaccine from the State
without charge.
``(3) The State will carry out a program to administer the
entitlements established pursuant to paragraphs (1) and (2).
``(c) Enforcement of Provider Rights by Eligible Children.--With
respect to the obligation of a State under the entitlement established
in subsection (b)(2), an eligible child (or representative of the
child) may enforce the rights of the provider under such paragraph if--
``(1) the provider administered a pediatric vaccine to the
child notwithstanding the failure of the State to carry out
such obligation with respect to the vaccine; or
``(2) an immunization with the vaccine was sought for the
child by a parent of the child, but the provider, on the basis
of such failure of the State, did not administer the vaccine to
the child.
``(d) Certain Conditions.--
``(1) In general.--This part does not apply with respect to
any vaccine administered before October 1, 1994.
``(2) Relationship to purchase contracts with
manufacturers.--With respect to a pediatric vaccine, the
obligation of the Federal Government pursuant to subsection
(a), and the obligations of the State pursuant to subsection
(b), are effective only to the extent that there is in effect a
contract under section 2158 for the purchase and delivery of
the vaccine.
``(3) Submission of application.--
``(A) Subject to subparagraph (C), the entitlements
established pursuant to subsections (a) and (b) are
established with respect to a State upon the State
submitting to the Secretary an application in
accordance with section 2157.
``(B) An application submitted to the Secretary
under section 2157 is deemed to have been submitted in
accordance with such section unless the Secretary, not
later than 30 days after the date on which the
application is submitted, notifies the State that the
application is not in accordance with such section.
``(C) In the case of a State whose application
submitted under section 2157 is not submitted in
accordance with such section, the Secretary may, upon
the submission by the State of an application that is
in accordance with such section, provide that the
entitlements established pursuant to such submission
are deemed to have been established on the date on
which the State first submitted the application.
``SEC. 2153. VOLUNTARY PARTICIPATION OF HEALTH CARE PROVIDERS.
``(a) In General.--
``(1) Request for participation; required approval.--The
Secretary may provide for the purchase and delivery of
pediatric vaccines under section 2151 on behalf of a State only
if the State agrees that federally-supplied pediatric vaccines
will not be distributed to a health care provider unless--
``(A) the provider submits to the State a written
request to participate in the program established by
the State pursuant to section 2152(b)(3);
``(B) the request is in such form and is made in
such manner as the Secretary may require; and
``(C) the provider makes the agreements described
in this section.
``(2) Program-registered providers.--For purposes of this
part, the term `program-registered provider' means a health
care provider that meets the conditions specified in
subparagraphs (A) through (C) of paragraph (1).
``(b) Eligibility of Children.--
``(1) In general.--An agreement for a health care provider
under subsection (a) is that the provider--
``(A) before administering a pediatric vaccine to a
child, will ask a parent of the child such questions as
are necessary to determine whether the child is an
eligible child;
``(B) will, for a period of time specified by the
Secretary, maintain records of responses made to the
questions; and
``(C) will, upon request, make such records
available to the State involved and to the Secretary,
subject to paragraph (2).
``(2) Restriction on use of information.--Records provided
to a State or to the Secretary under paragraph (1)(C) may be
used only for purposes of audit of the program carried out
under section 2152(b)(3) by the State.
``(c) Charges for Vaccines.--
``(1) Vaccines per se.--An agreement for a health care
provider under subsection (a) is that, in administering a
federally-supplied pediatric vaccine to an eligible child, the
provider will not impose a charge for the cost of the vaccine.
``(2) Administration of vaccines.--With respect to
compliance with an agreement under paragraph (1), a program-
registered provider may impose a charge for the administration
of a federally-supplied pediatric vaccine, subject to an
agreement by the provider that the provider will not impose
such charge with respect to a child if a parent of the child
certifies to the provider that the parent is unable to pay the
charge.
``(d) Rules of Construction.--
``(1) Extent of participation.--This section may not be
construed as requiring that a program-registered provider
administer a federally-supplied pediatric vaccine to each
eligible child for whom an immunization with the vaccine is
sought from the provider.
``(2) Verification of information.--With respect to
compliance with agreements under subsections (b) and (c), such
agreements may not be construed as requiring a program-
registered provider to verify independently the information
provided to the provider by a parent pursuant to such
subsections.
``SEC. 2154. INTRASTATE DISTRIBUTION OF PEDIATRIC VACCINES.
``(a) In General.--Not later than 180 days after the date of the
enactment of the Omnibus Budget Reconciliation Act of 1993, the
Secretary shall, through publication in the Federal Register, establish
criteria for the delivery on behalf of the States of federally-supplied
pediatric vaccines to program-registered providers in the State.
``(b) Involvement of Certain Providers.--
``(1) In general.--In establishing criteria under
subsection (a), the Secretary shall establish criteria with
respect to encouraging the entities described in paragraph (2)
to become program-registered providers.
``(2) Relevant providers.--The entities referred to in
paragraph (1) are--
``(A) private health care providers; and
``(B)(i) health care providers that receive funds
under title V of the Indian Health Care Improvement
Act;
``(ii) the Indian Health Service; and
``(iii) health programs or facilities operated by
Indian tribes or tribal organizations.
``(c) Cultural Context of Services.--In establishing criteria under
subsection (a), the Secretary shall require that, in providing a
federally-supplied pediatric vaccine to any population of eligible
children a substantial portion of whose parents have a limited ability
to speak the English language, a State have in effect a reasonable plan
to administer the vaccines through program-registered providers who are
able to communicate with the population involved in the language and
cultural context that is most appropriate.
``(d) Compliance by States.--The Secretary may provide for the
purchase and delivery of pediatric vaccines under section 2151 on
behalf of a State only if the State agrees to maintain compliance with
the criteria established under subsection (a).
``SEC. 2155. GENERAL PROVISIONS.
``(a) Federal Standards on Accountability.--
``(1) Establishment of standards.--Not later than 180 days
after the date of the enactment of the Omnibus Budget
Reconciliation Act of 1993, the Secretary shall, through
publication in the Federal Register, establish standards with
respect to determining the extent to which States and program-
registered providers are in compliance with the agreements made
under this part.
``(2) Compliance by states.-- The Secretary may provide for
the purchase and delivery of pediatric vaccines under section
2151 on behalf of a State only if the State agrees to maintain
compliance with the standards established under subsection (a).
``(b) State Maintenance of Immunization Laws.--The Secretary may
provide for the purchase and delivery of vaccines under section 2151 on
behalf of a State only if the State certifies to the Secretary that, if
it had in effect as of May 1, 1993, a law that requires some or all
health insurance policies or plans to provide some coverage with
respect to a pediatric vaccine, the State has not modified or repealed
such law in a manner that reduces the amount of coverage so required.
``(c) Participation in National Monitoring System.--On and after
January 1, 1998, the Secretary may provide for the purchase and
delivery of vaccines under section 2151 on behalf of a State only if
the State certifies to the Secretary that the State is operating a
registry in accordance with part B.
``SEC. 2156. STATE OPTION REGARDING IMMUNIZATION OF ADDITIONAL
CATEGORIES OF CHILDREN.
``(a) State Purchases.--Subject to subsections (b) and (c), for the
purpose of administering a pediatric vaccine to children in addition to
eligible children, any participating State under section 2151 may,
pursuant to section 2158(a)(2), purchase the vaccine from a
manufacturer of the vaccine at the price in effect under section 2158.
``(b) Requirements.--A State may purchase pediatric vaccines
pursuant to subsection (a) only if the following conditions are met:
``(1) The State agrees that the vaccines will be used to
provide immunizations for children who are not eligible
children.
``(2) The State designates the particular categories of
children who are to receive the immunizations, and submits to
the Secretary a description of the categories so designated.
``(3) The State provides to the Secretary such information
as the Secretary determines to be necessary to provide for
quantities of pediatric vaccines for the State to purchase
pursuant to section 2158(a)(2).
``(4) The State agrees, subject to subsection (c), that the
program established by the State pursuant to section 2152(b)(3)
applies to children designated under paragraph (2) to the same
extent and in the same manner as the program applies to
eligible children (except for the State being the purchaser of
the pediatric vaccines involved).
``(c) Certain Limitations.--A State may purchase pediatric vaccines
pursuant to subsection (a) only if the State agrees as follows:
``(1) The authorization established in such subsection with
respect to a pediatric vaccine is subject to the quantity of
the vaccine that, on behalf of the State, the Secretary
provides for under section 2158(a)(2).
``(2) In any case in which multiple contracts are in effect
under section 2158 with respect to such a vaccine and the State
elects to purchase the vaccine pursuant to subsection (a), the
Secretary will determine which of such contracts will be
applicable to the purchase.
``SEC. 2157. STATE APPLICATION FOR VACCINES.
``(a) In General.--An application by a State for pediatric vaccines
under section 2151(a) is in accordance with this section if the
application--
``(1) is submitted not later than the date specified by the
Secretary;
``(2) contains each agreement required in this part
(including the agreements required in section 2156, if the
State is electing to purchase pediatric vaccines pursuant to
such section);
``(3) contains any information required in this part to be
submitted to the Secretary (including the information required
in section 2156, if the State is electing to purchase pediatric
vaccines pursuant to such section);
``(4) contains the certification required in subsection (b)
of section 2155 and, as applicable, the certification required
in subsection (c) of such section; and
``(5) is in such form, is made in such manner, and contains
such agreements, assurances, and information as the Secretary
determines to be necessary to carry out this part.
``(b) Failure to Apply.--
``(1) In general.--If, as of January 1, 1998, a State is
not receiving pediatric vaccines under section 2151 and
carrying out a program pursuant to section 2152(b)(3), the
Secretary shall, subject to paragraph (2), terminate payments
to the State under part A of title XIX.
``(2) Exceptions.--Paragraph (1) does not apply in the case
of a State described in such paragraph that--
``(A) is, through all willing health care
providers, providing for the immunization of eligible
children with pediatric vaccines, and is not imposing a
charge on such providers or children for the costs of
the vaccines; or
``(B) meets or exceeds the objectives established
by the Secretary for the year 2000 for the immunization
status of children in the United States who are 2 years
of age.
``SEC. 2158. CONTRACTS WITH MANUFACTURERS OF PEDIATRIC VACCINES.
``(a) In General.--Subject to the provisions of this section, the
Secretary shall periodically enter into negotiations with manufacturers
of pediatric vaccines for the purpose of maintaining contracts under
which--
``(1) the Secretary provides for the purchase of quantities
of pediatric vaccines necessary for carrying out section 2151,
and provides for the delivery of the vaccines to participating
States under such section; and
``(2) each participating State, at the option of the State
under section 2156, is permitted to obtain additional
quantities of pediatric vaccines (subject to limits in such
contracts regarding quantities) through purchasing the vaccines
from the manufacturers at the price negotiated by the Secretary
for the quantities specified in paragraph (1).
The Secretary shall enter into the initial negotiations under the
preceding sentence not later than 180 days after the date of the
enactment of the Omnibus Budget Reconciliation Act of 1993.
``(b) Negotiation of Purchase Price.--
``(1) In general.--In negotiating the prices at which
pediatric vaccines will be purchased from a manufacturer under
subsection (a), the Secretary shall negotiate a price that
provides a reasonable profit for the manufacturer.
``(2) Certain factors.--
``(A) In determining a reasonable profit for a
manufacturer under paragraph (1), the Secretary shall
consider the following factors:
``(i) The costs of the manufacturer in
researching, developing, and producing the
pediatric vaccine involved.
``(ii) The costs of the manufacturer in
researching and developing new or improved
vaccines (pediatric or otherwise).
``(iii) The costs of shipping and handling
pediatric vaccines in compliance with the
agreement under subsection (c).
``(iv) Such other factors as the Secretary
determines to be appropriate.
``(B) With respect to factors considered under
subparagraph (A), the Secretary may enter into a
contract under subsection (a) only if the manufacturer
involved provides to the Secretary such information
regarding the factors as the Secretary determines to be
appropriate.
``(3) Confidentiality.--With respect to information
provided to the Secretary by a manufacturer under paragraph
(2), the following applies:
``(A) The Secretary shall maintain the
confidentiality of the information, with provision for
reasonable disclosures.
``(B) For purposes of section 552(b)(4) of title 5,
United States Code, the information shall be considered
to be trade secrets and commercial or financial
information obtained from a person and privileged or
confidential.
``(C) Section 1905 of title 18, United States Code,
applies to information maintained confidentially under
subparagraph (A).
``(c) Charges for Shipping and Handling.--The Secretary may enter
into a contract under subsection (a) only if the manufacturer involved
agrees that the manufacturer will provide for delivering the vaccines
on behalf of the States in accordance with the programs established by
the States pursuant to section 2152(b)(3), and will not impose any
charges for the costs of such delivery (except to the extent such costs
are provided for in the price negotiated under subsection (b)).
``(d) Quantity of Vaccines.--For the purpose of ensuring that the
Federal Government has the ability to carry out section 2151, the
Secretary, in negotiations under subsection (a), shall negotiate for
maintaining a supply of pediatric vaccines to meet unanticipated needs
for the vaccines. For purposes of the preceding sentence, the Secretary
shall negotiate for a 6-month supply of vaccines in addition to the
quantity that the Secretary otherwise would provide for in such
negotiations. In carrying out this paragraph, the Secretary shall
consider the potential for outbreaks of the diseases with respect to
which the vaccines have been developed.
``(e) Negotiating Authority of Secretary.--In carrying out
subsection (a), the Secretary, to the extent determined by the
Secretary to be appropriate, may enter into contracts described in such
subsection, may decline to enter into such contracts, and with the
consent of the manufacturers involved, may modify such agreements and
may extend such agreements.
``(f) Certain Contract Provisions.--
``(1) Duration.--A contract entered into by the Secretary
under subsection (a) is effective for such period as the
Secretary and the manufacturer involved may agree in the
contract.
``(2) Advance funding.--The Secretary may, pursuant to
section 2152(a), enter into contracts under subsection (a)
under which the Federal Government is obligated to make
outlays, the budget authority for which is not provided for in
advance in appropriations Acts.
``(g) Reports to Secretary.--The Secretary may enter into a
contract under subsection (a) only if the manufacturer involved agrees
to submit to the Secretary such reports as the Secretary determines to
be appropriate with respect to compliance with the contract. For
purposes of paragraph (3) of subsection (b), such reports shall be
considered to be information provided by the manufacturer to the
Secretary under paragraph (2) of such subsection.
``(h) Multiple Suppliers.--
``(1) In general.--In the case of the pediatric vaccine
involved, the Secretary shall, as appropriate, enter into a
contract under subsection (a) with each manufacturer of the
vaccine that meets the terms and conditions of the Secretary
for an award of such a contract (including terms and conditions
regarding safety, quality, and price).
``(2) Rule of construction.--With respect to multiple
contracts entered into pursuant to paragraph (1), such
paragraph may not be construed as prohibiting the Secretary
from having in effect different prices under each of such
contracts.
``SEC. 2159. CERTAIN ADMINISTRATIVE VARIATIONS.
``(a) Tribes and Tribal Organizations.--
``(1) In general.--Subject to paragraph (2), the Secretary
shall provide for the purchase and delivery on behalf of each
Indian tribe and each tribal organization of such quantities of
pediatric vaccines as may be necessary for the immunization of
each Indian child in the State in which the tribe or
organization (as the case may be) is located.
``(2) Entitlements; administering program.--The Secretary
may provide for the purchase and delivery of pediatric vaccines
under paragraph (1) on behalf of an Indian tribe or tribal
organization only if the tribe or organization (as the case may
be) agrees that this part applies to the tribe or organization
(in relation to Indian children) to the same extent and in the
manner as such part applies to States (in relation to eligible
children).
``(b) State as Manufacturer.--
``(1) Payments in lieu of vaccines.--In the case of a
participating State under section 2151 that manufactures a
pediatric vaccine and is not receiving the vaccine under such
section, if the Secretary determines that the program of the
State under 2152(b)(3) is carried out with respect to the
vaccine, the Secretary shall provide to the State an amount
equal to the value of the quantity of such vaccine that
otherwise would have been delivered to the State under section
2151, subject to the provisions of this subsection.
``(2) Determination of value.--In determining the amount to
pay a State under paragraph (1) with respect to a pediatric
vaccine, the value of the quantity of vaccine shall be
determined on the basis of the price in effect for the vaccine
under contracts under section 2158. If more than 1 such
contract is in effect, the Secretary shall determine such value
on the basis of the average of the prices under the contracts,
after weighting each such price in relation to the quantity of
vaccine under the contract involved.
``(3) Use of payments.--A State may expend payments
received under paragraph (1) only for purposes relating to
pediatric vaccines.
``SEC. 2160. LIST OF PEDIATRIC VACCINES; SCHEDULE FOR ADMINISTRATION.
``(a) Recommended Pediatric Vaccines.--
``(1) In general.--The Secretary shall establish a list of
the vaccines that the Secretary recommends for administration
to all children for the purpose of immunizing the children,
subject to such contraindications for particular medical
categories of children as the Secretary may establish under
subsection (b)(1)(D). The Secretary shall periodically review
the list, and shall revise the list as appropriate.
``(2) Rule of construction.--
``(A) The list of vaccines specified in
subparagraph (B) is deemed to be the list of vaccines
maintained under paragraph (1).
``(B) The list of vaccines specified in this
subparagraph is the list of vaccines that, for purposes
of paragraph (1), is established (and periodically
reviewed and as appropriate revised) by the Advisory
Committee on Immunization Practices, an advisory
committee established by the Secretary, acting through
the Director of the Centers for Disease Control and
Prevention.
``(b) Recommended Schedule for Administration.--
``(1) In general.--Subject to paragraph (2), in the case of
a pediatric vaccine, the Secretary shall establish (and
periodically review and as appropriate revise) a schedule of
nonbinding recommendations for the following:
``(A) The number of immunizations with the vaccine
that children should receive.
``(B) The ages at which children should receive the
immunizations.
``(C) The dosage of vaccine that should be
administered in the immunizations.
``(D) Any contraindications regarding
administration of the vaccine to particular medical
categories of children.
``(E) Such other guidelines as the Secretary
determines to be appropriate with respect to
administering the vaccine to children.
``(2) Variations in medical practice.--In establishing and
revising a schedule under paragraph (1), the Secretary shall
ensure that, in the case of the pediatric vaccine involved, the
schedule provides for the full range of variations in medical
judgment regarding the administration of the vaccine, subject
to remaining within medical norms.
``(3) Rule of construction.--
``(A) The schedule specified in subparagraph (B) is
deemed to be the schedule maintained under paragraph
(1).
``(B) The schedule specified in this subparagraph
is the schedule that, for purposes of paragraph (1), is
established (and periodically reviewed and as
appropriate revised) by the advisory committee
specified in subsection (a)(2)(B).
``(c) Generally Applicable Rules of Construction.--
``(1) In general.--The list established under subsection
(a) and the schedules established under subsection (b) do not
constitute guidelines, standards, performance measures, or
review criteria for purposes of the program carried out by the
Administrator for Health Care Policy and Research under part B
of title IX or under section 1142 of the Social Security Act.
``(2) State laws.--This section does not supersede any
State law on requirements with respect to receiving
immunizations (including any such law relating to religious
exemptions or medical exemptions).
``(d) Issuance of List and Schedules.--Not later than 180 days
after the date of the enactment of the Omnibus Budget Reconciliation
Act of 1993, the Secretary shall establish the initial list required in
subsection (a) and the schedule required in subsection (b).
``SEC. 2161. CHILDHOOD IMMUNIZATION TRUST FUND.
``(a) Establishment of Fund.--There is established in the Treasury
of the United States a fund to be known as the National Childhood
Immunization Trust Fund (in this section referred to as the `Fund').
The Fund shall consist of such amounts as may be appropriated to the
Fund in appropriations Acts, in the Internal Revenue Code of 1986, or
in subsection (c)(3). Amounts appropriated to the Fund shall remain
available until expended.
``(b) Expenditures From Fund.--Amounts in the Fund are available to
the Secretary for the purpose of carrying out this part. Payments under
the program under this part, and the costs of carrying out such
program, shall be exempt from reduction under any order issued under
part C of the Balanced Budget and Emergency Deficit Control Act of
1985.
``(c) Investment.--
``(1) In general.--The Secretary of the Treasury shall
invest such amounts of the Fund as such Secretary determines
are not required to meet current withdrawals from the Fund.
Such investments may be made only in interest-bearing
obligations of the United States. For such purpose, such
obligations may be acquired on original issue at the issue
price, or by purchase of outstanding obligations at the market
price.
``(2) Sale of obligations.--Any obligation acquired by the
Fund may be sold by the Secretary of the Treasury at the market
price.
``(3) Availability of income.--Any interest derived from
obligations acquired by the Fund, and proceeds from any sale or
redemption of such obligations, are hereby appropriated to the
Fund.
``SEC. 2162. DEFINITIONS.
``For purposes of this subtitle:
``(1) The term `eligible child' has the meaning given such
term in section 2151(b).
``(2) The term `federally-supplied', with respect to a
pediatric vaccine, means that such vaccine is purchased and
delivered on behalf of a State under section 2151(a).
``(3) The term `health care provider', with respect to the
administration of vaccines to children, means an entity that is
licensed or otherwise authorized for such administration under
the law of the State in which the entity administers the
vaccine, subject to section 333(e).
``(4) The term `immunization' means an immunization against
a vaccine-preventable disease.
``(5) Each of the terms `Indian', `Indian tribe', and
`tribal organization' has the meaning given such term in
section 4 of the Indian Health Care Improvement Act.
``(6) The term `Indian child' means an Indian who is 18
years of age or younger.
``(7) The term `manufacturer' means any corporation,
organization, or institution, whether public or private
(including Federal, State, and local departments, agencies, and
instrumentalities), which manufactures, imports, processes, or
distributes under its label any pediatric vaccine. The term
`manufacture' means to manufacture, import, process, or
distribute a vaccine.
``(8) The term `parent', with respect to a child, means a
legal guardian of the child.
``(9) The term `participating State under section 2151'
means a State that has submitted to the Secretary an
application in accordance with section 2157.
``(10) The term `pediatric vaccine' means a vaccine
included on the list established under section 2160(a).
``(11) The term `program-registered provider' has the
meaning given such term in 2153(a)(2).
``SEC. 2163. TERMINATION OF PROGRAM.
This part shall cease to be in effect beginning on such date as may
be prescribed in Federal law providing for immunization services for
all children as part of a broad-based reform of the national health
care system.
``Part B--National System for Monitoring Immunization Status of
Children
``SEC. 2171. FORMULA GRANTS FOR STATE REGISTRIES WITH RESPECT TO
MONITORING.
``(a) In General.--For the purpose described in subsection (b), the
Secretary, acting through the Director of the Centers for Disease
Control and Prevention, shall make an allotment each fiscal year for
each State in an amount determined in accordance with section 2175. The
Secretary shall make a grant to the State of the allotment made for the
State for the fiscal year if the State submits to the Secretary an
application in accordance with section 2174.
``(b) Authorized Activities.--The Secretary may make a grant under
subsection (a) only if the State agrees to expend the grant for the
purpose of--
``(1) collecting the data described in section 2172;
``(2) operating registries to maintain the data (and
establishing such registries, in the case of a State that is
not operating such a registry);
``(3) utilizing the data to monitor the extent to which
children have received immunizations in accordance with the
schedule established under section 2160(b);
``(4) notifying parents if children have not received
immunizations in accordance with such schedule; and
``(5) such other activities as the Secretary may authorize
with respect to achieving the objectives established by the
Secretary for the year 2000 for the immunization status of
children in the United States.
``(c) Requirement Regarding State Laws.--
``(1) In general.--The Secretary may make a grant under
subsection (a) only if the State involved--
``(A) provides assurances satisfactory to the
Secretary that, not later than October 1, 1996, the
State will be operating a registry in accordance with
this part, including having in effect such laws and
regulations as may be necessary to so operate such a
registry; and
``(B) agrees that, prior to such date, the State
will make such efforts to operate a registry in
accordance with this part as may be authorized in the
law and regulations of the State.
``(2) Rules of construction.--
``(A) With respect to the agreements made by a
State under this part, other than the agreement under
paragraph (1)(B), the Secretary may require compliance
with the agreements only to the extent consistent with
such paragraph.
``(B) This part does not authorize the Secretary,
as a condition of the receipt of a grant under
subsection (a) by a State, to prohibit the State from
providing any parent, upon the request of the parent,
with an exemption from the requirements established by
the State pursuant to this part for the collection of
data regarding any child of the parent.
``SEC. 2172. REGISTRY DATA.
``(a) In General.--For purposes of section 2171(b)(1), the data
described in this section are the data described in subsection (b) and
the data described in subsection (c). This section applies to data
regarding a child without regard to whether the child is an eligible
child as defined in section 2162.
``(b) Data Regarding Birth of Child.--With respect to the birth of
a child, the data described in this subsection is as follows:
``(1) The name of each child born in the State involved on
or after October 1, 1993.
``(2) Demographic data on the child.
``(3) The name of one or both of the parents of the child.
``(4) The address, as of the date of the birth of the
child, of each parent whose name is received in the registry
pursuant to paragraph (3).
``(c) Data Regarding Individual Immunizations.--With respect to a
child to whom a pediatric vaccine is administered in the State
involved, the data described in this subsection is as follows:
``(1) The name, age, and address of the child.
``(2) The date on which the vaccine was administered to the
child.
``(3) The name and business address of the health care
provider that administered the vaccine.
``(4) The address of the facility at which the vaccine was
administered.
``(5) The name and address of one or both parents of the
child as of the date on which the vaccine was administered, if
such information is available to the health care provider.
``(6) The type of vaccine.
``(7) The number or other information identifying the
particular manufacturing batch of the vaccine, if such
information appears on the container or packaging for the
vaccine or is otherwise readily accessible to the health care
provider.
``(8) The dosage of vaccine that was administered.
``(9) A description of any adverse medical reactions that
the child experienced in relation to the vaccine and of which
the health care provider is aware.
``(10) Any other contraindications noted by the health care
provider with respect to administration of the vaccine to the
child.
``(11) Such other data regarding immunizations for the
child, including identifying data, as the Secretary may require
consistent with applicable law (including social security
account numbers furnished pursuant to section 205(c)(2)(E) of
the Social Security Act).
``(d) Date Certain for Submission to Registry.--The Secretary may
make a grant under section 2171 only if the State involved agrees to
ensure that, with respect to a child--
``(1) the data described in subsection (b) are submitted to
the registry under such section not later than 6 weeks after
the date on which the child is born; and
``(2) the data described in subsection (c) with respect to
a vaccine are submitted to such registry not later than 6 weeks
after the date on which the vaccine is administered to the
child.
``SEC. 2173. GENERAL PROVISIONS.
``(a) Federal Standards on Confidentiality.--The Secretary shall by
regulation establish standards providing for maintaining the
confidentiality of the identity of individuals with respect to whom
data are maintained in registries under section 2171. Such standards
shall, with respect to a State, provide that the State is to have in
effect laws regarding such confidentiality, including appropriate
penalties for violation of the laws. The Secretary may make a grant
under such section only if the State involved agrees to comply with the
standards.
``(b) Use of Social Security Account Numbers.--Any usage or
disclosure of data in registries under section 2171 that consists of
social security account numbers and related information which is
otherwise permitted under this part may be exercised only to the extent
permitted under section 205(c)(2)(E) of the Social Security Act. For
purposes of the preceding sentence, the term `related information' has
the meaning given such term in clause (iv)(II) of such section.
``(c) Uniformity in Methodologies.--The Secretary shall establish
standards regarding the methodologies used in establishing and
operating registries under section 2171, and may make a grant under
such section only if the State agrees to comply with the standards. The
Secretary shall provide for a reasonable degree of uniformity among the
States in such methodologies for the purpose of ensuring the utility,
comparability, and exchange of the data maintained in such registries.
``(d) Coordination Among States.--The Secretary may make a grant
under section 2171 to a State only if, with respect to the operation of
the registry of the State under such section, the State agrees to
cooperate with the Secretary and with other States in carrying out
activities with respect to achieving the objectives established by the
Secretary for the year 2000 for the immunization status of children in
the United States.
``(e) Reports to Secretary.--The Secretary may make a grant under
section 2171 only if the State involved agrees to submit to the
Secretary such reports as the Secretary determines to be appropriate
with respect to the activities of the State under this part.
``SEC. 2174. APPLICATION FOR GRANT.
``An application by a State for a grant under section 2171 is in
accordance with this section if the application--
``(1) is submitted not later than the date specified by the
Secretary;
``(2) contains each agreement required in this part;
``(3) contains any information required in this part to be
submitted to the Secretary; and
``(4) is in such form, is made in such manner, and contains
such agreements, assurances, and information as the Secretary
determines to be necessary to carry out this part.
``SEC. 2175. DETERMINATION OF AMOUNT OF ALLOTMENT.
``The Secretary shall determine the amount of the allotments
required in section 2171 for States for a fiscal year in accordance
with a formula established by the Secretary that allots the amounts
appropriated under section 2177 for the fiscal year on the basis of the
costs of the States in establishing and operating registries under
section 2171.
``SEC. 2176. DEFINITIONS.
``For purposes of this part, each of the terms `health care
provider, `pediatric vaccine' and `parent' has the meaning given the
term in section 2162.
``SEC. 2177. AUTHORIZATION OF APPROPRIATIONS.
``For the purpose of carrying out this part, there are authorized
to be appropriated $50,000,000, for fiscal year 1994, $152,000,000 for
fiscal year 1995, $125,000,000 for fiscal year 1996, and $35,000,000
for each of the fiscal years 1997 through 1999.
``Part C--Funding for Other Purposes Regarding Childhood Immunizations
``SEC. 2181. GRANTS REGARDING YEAR 2000 HEALTH OBJECTIVES.
``(a) In General.--The Secretary, acting through the Director of
the Centers for Disease Control and Prevention, may make grants to
States for the purpose of carrying out activities with respect to
achieving the objectives established by the Secretary for the year 2000
for the immunization status of children in the United States, other
than providing for the purchase and delivery on behalf of the State of
any pediatric vaccine (as defined in section 2162).
``(b) Certain Activities.--Subject to subsection (a), the purposes
for which a grant under such subsection may be expended include the
following:
``(1) Research into the prevention and control of diseases
that may be prevented through vaccination.
``(2) Demonstration projects for the prevention and control
of such diseases.
``(3) Public information and education programs for the
prevention and control of such diseases.
``(4) Education, training, and clinical skills improvement
activities in the prevention and control of such diseases for
health professionals (including allied health personnel).
``(5) Such other activities as the Secretary determines to
be appropriate.
``(c) Application for Grant.--The Secretary may make a grant under
subsection (a) only if an application for the grant is submitted to the
Secretary and the application is in such form, is made in such manner,
and contains such agreements, assurances, and information as the
Secretary determines to be necessary to carry out this section.
``(d) Supplies and Services in Lieu of Grant Funds.-- The
Secretary, at the request of a recipient of a grant under subsection
(a), may reduce the amount of such grant by--
``(1) the fair market value of any supplies or equipment
furnished the grant recipient, and
``(2) the amount of the pay, allowances, and travel
expenses of any officer or employee of the Federal Government
when detailed to the grant recipient and the amount of any
other costs incurred in connection with the detail of such
officer or employee.
When the furnishing of such supplies or equipment or the detail of such
an officer or employee is for the convenience of and at the request of
such grant recipient and for the purpose of carrying out a program with
respect to which the grant under subsection (a) is made. The amount by
which any such grant is so reduced shall be available for payment by
the Secretary of the costs incurred in furnishing the supplies or
equipment, or in detailing the personnel, on which the reduction of
such grant is based, and such amount shall be deemed as part of the
grant and shall be deemed to have been paid to the grant recipient.
``(e) Authorization of Appropriations.--For the purpose of carrying
out this part, there are authorized to be appropriated $580,000,000 for
fiscal year 1993, $680,000,000 for fiscal year 1994, and such sums as
may be necessary for each of the fiscal years 1995 through 1999.''.
(b) Authority to Use Social Security Account Numbers.--Section
205(c)(2) of the Social Security Act (42 U.S.C. 405(c)(2)) is amended--
(1) by redesignating subparagraphs (E) and (F) as
subparagraphs (F) and (G), respectively; and
(2) by inserting after subparagraph (D) the following new
subparagraph:
``(E)(i) The Secretary and each State receiving grants under
section 2171(a) of the Public Health Service Act may utilize social
security account numbers issued by the Secretary under this subsection
for purposes of--
``(I) operating registries under such section to maintain
information including such numbers (and establishing such
registries, in the case of a State that is not operating such a
registry),
``(II) utilizing such numbers to monitor the extent to
which children have received immunizations in accordance with
the schedule established under section 2160(b) of the Public
Health Service Act, and
``(III) notifying parents if children have not received
immunizations in accordance with such schedule.
``(ii) Disclosure by individuals of social security account numbers
may be required by a State for purposes of identification of children
in a registry operated pursuant to a grant referred to in clause (i),
except that such disclosure may be required to be made only to persons
specifically authorized in regulations of the Secretary prescribed
under part B of subtitle 3 of title XXI of the Public Health Service
Act. The Secretary shall take such actions as are necessary to restrict
access to information consisting of such numbers and related
information only to such authorized persons whose duties or
responsibilities require access for the purposes described in clause
(i). The Secretary shall issue regulations governing the use,
maintenance, and disclosure by any holder of such information,
including appropriate administrative, technical, and physical
safeguards, to ensure that only such authorized persons have access to
such information. Any use or disclosure of such information in
violation of such regulations shall be deemed a disclosure in violation
of subparagraph (C)(vii).
``(iii) The Secretary shall submit a report to the Committee on
Ways and Means of the House of Representatives and the Committee on
Finance of the Senate not later than January 1, 1996, and biennially
thereafter, on the operation of this subparagraph.
``(iv) For purposes of this subparagraph--
``(I) the term `State' has the meaning provided such term
under section 2(f) of the Public Health Service Act, and
``(II) the term `related information' means any record,
list, or compilation which indicates, directly or indirectly,
the identity of any individual with respect to whom a social
security account number is maintained pursuant to this
subparagraph and part B of subtitle 3 of title XXI of the
Public Health Service Act.''.
(c) Relationship of New Program of Immunization Grants to Current
Program.--
(1) Striking of current program.--Section 317 of the Public
Health Service Act (42 U.S.C. 247b) is amended--
(A) in subsection (j)--
(i) by striking paragraph (1); and
(ii) by striking the remaining paragraph
designation; and
(B) in subsection (k)--
(i) by striking paragraph (1); and
(ii) by redesignating paragraphs (2)
through (5) as paragraphs (1) through (4),
respectively.
(2) Transitional authority under new program.--With respect
to activities that the Secretary of Health and Human Services
was authorized to carry out pursuant to section 317(j)(1) of
the Public Health Service Act (as in effect on the day before
the date of the enactment of this Act), the Secretary may, for
fiscal year 1994, carry out any such activity under section
2181 of the Public Health Service Act (as added by subsection
(a) of this section), notwithstanding the provisions of such
section 2181. The authority established in the preceding
sentence includes the authority to purchase vaccines.
(d) Continued Coverage of Costs of a Pediatric Vaccine under Group
Health Plans.--
(1) Requirement.--The requirement of this paragraph, with
respect to a group health plan for plan years beginning after
the date of the enactment of this Act, is that the group health
plan not reduce its coverage of the costs of pediatric vaccines
(as defined under section 2162 of the Public Health Service
Act) below the coverage it provided as of May 1, 1993.
(2) Enforcement.--
(A) For purposes of section 2207 of the Public
Health Service Act, the requirement of paragraph (1) is
deemed a requirement of title XXII of such Act.
(B) For purposes of subsections (a) through (e) of
section 4980B of the Internal Revenue Code of 1986,
paragraph (1) is deemed a requirement of subsection (f)
of such section.
(C) For purposes of section 502 of the Employee
Retirement Income Security Act of 1974, paragraph (1)
is deemed a provision of part 6 of subtitle B of title
I of such Act.
SEC. 5182. NATIONAL VACCINE INJURY COMPENSATION PROGRAM AMENDMENTS.
(a) Use of Vaccine Injury Compensation Trust Fund.--Section 6601(r)
of the Omnibus Budget Reconciliation Act of 1989 is amended by striking
``$2,500,000 for each of fiscal years 1991 and 1992'' each place it
appears and inserting ``$3,000,000 for fiscal year 1994 and each fiscal
year thereafter'' (in three places).
(b) Amendment of Vaccine Injury Table.--Section 2116(b) of the
Public Health Service Act (42 U.S.C. 300aa-16(b)) is amended by
striking ``such person may file'' and inserting ``or to significantly
increase the likelihood of obtaining compensation, such person may,
notwithstanding section 2111(b)(2), file''.
(c) Extension of Time for Decision.--Section 2112(d)(3)(D) of such
Act (42 U.S.C. 300aa-12(d)(3)(D)) is amended by striking ``540 days''
and inserting ``30 months (but for no more than 6 months at a time)''.
(d) Simplification of Vaccine Information Materials.--
(1) Section 2126(b) of such Act (42 U.S.C. 300aa-26(b)) is
amended--
(A) by striking ``by rule'' in the matter preceding
paragraph (1);
(B) by striking, in paragraph (1), ``, opportunity
for a public hearing, and 90'' and inserting ``and
30''; and
(C) by striking, in paragraph (2), ``, appropriate
health care providers and parent organizations''.
(2) Section 2126(c) of such Act (42 U.S.C. 300aa-26(c)) is
amended--
(A) by inserting ``shall be based on available data
and information,'' after ``such materials'' in the
matter preceding paragraph (1), and
(B) by striking paragraphs (1) through (10) and
inserting the following:
``(1) a concise description of the benefits of the vaccine,
``(2) a concise description of the risks associated with
the vaccine,
``(3) a statement of the availability of the National
Vaccine Injury Compensation Program, and
``(4) such other relevant information as may be determined
by the Secretary.''.
(3) Subsections (a) and (d) of section 2126 of such Act (42
U.S.C. 300aa-26) are each amended by inserting ``or to any
other individual'' after ``to the legal representatives of any
child''.
(4) Subsection (d) of section 2126 of such Act (42 U.S.C.
300aa-26) is amended--
(A) by striking all after ``subsection (a),'' the
second place it appears in the first sentence and
inserting ``supplemented with visual presentations or
oral explanations, in appropriate cases.'', and
(B) by striking ``or other information'' in the
last sentence.
SEC. 5183. MEDICAID IMMUNIZATION PROVISIONS.
(a) Outreach and Education.--
(1) Immunization outreach through epsdt program.--Section
1902(a)(43)(A) (42 U.S.C. 1396a(a)(43)(A)) is amended by
inserting before the comma at the end the following: ``and the
need for age-appropriate immunizations against vaccine-
preventable diseases''.
(2) Coordination with maternal and child health block grant
programs and wic programs.--Section 1902(a)(11) (42 U.S.C.
1396a(a)(11)) is amended--
(A) in clause (B)--
(i) by striking ``effective July 1,
1969,'',
(ii) by striking ``and'' before ``(ii)'',
and
(iii) by striking ``to him under section
1903'' and inserting ``to the individual under
section 1903, and (iii) providing for
coordination of information and education on
childhood vaccinations and delivery of
immunization services''; and
(B) in clause (C), by inserting ``(including the
provision of information and education on childhood
vaccinations and the delivery of immunization
services)'' after ``operations under this title''.
(3) Coverage of public housing health centers as federally-
qualified health centers.--Section 1905(l)(2)(B) (42 U.S.C.
1396d(l)(2)(B)) is amended by striking ``or 340'' each place it
appears and inserting ``340, or 340A''.
(4) Effective date.--(A) Except as provided in subparagraph
(B), the amendments made by this subsection shall apply to
calendar quarters beginning on or after October 1, 1993,
without regard to whether or not final regulations to carry out
such amendments have been promulgated by such date.
(B) In the case of a State plan for medical assistance
under title XIX of the Social Security Act which the Secretary
of Health and Human Services determines requires State
legislation (other than legislation appropriating funds) in
order for the plan to meet the additional requirements imposed
by the amendments made by this subsection, the State plan shall
not be regarded as failing to comply with the requirements of
such title solely on the basis of its failure to meet these
additional requirements before the first day of the first
calendar quarter beginning after the close of the first regular
session of the State legislature that begins after the date of
the enactment of this Act. For purposes of the previous
sentence, in the case of a State that has a 2-year legislative
session, each year of such session shall be deemed to be a
separate regular session of the State legislature.
(b) Schedule of Immunizations under EPSDT.--
(1) In general.--Section 1905(r)(1) (42 U.S.C. 1396d(r)(1))
is amended--
(A) in subparagraph (A)(i), by inserting ``and,
with respect to immunizations under subparagraph
(B)(iii), in accordance with the schedule recommended
by the Secretary under section 2160 of the Public
Health Service Act'' after ``child health care''; and
(B) in subparagraph (B)(iii), by inserting
``(according to the schedule recommended by the
Secretary under section 2160 of the Public Health
Service Act)'' after ``appropriate immunizations''.
(2) Effective date.--The amendments made by subparagraphs
(A) and (B) of paragraph (1) shall first apply 90 days after
the date the Secretary of Health and Human Services first
issues the recommended schedule referred to in subparagraphs
(A)(i) and subparagraph (B)(iii) of section 1905(r)(1) of the
Social Security Act (as amended by such respective
subparagraphs).
(c) Assuring Adequate Payment Rates for Administration of Vaccines
to Children.--
(1) Payment rates.--Section 1926(a)(4)(B) (42 U.S.C. 1396r-
7(a)(4)(B)) is amended by inserting ``(including the
administration of vaccines)'' after ``means services''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to the plan amendment required to be submitted
under section 1926(a)(2) of the Social Security Act by not
later than April 1, 1994.
(d) Denial of Federal Financial Participation for Inappropriate
Administration of Single-Antigen Vaccine.--
(1) In general.--Section 1903(i) (42 U.S.C. 1396b(i)), as
amended by sections 5174(b) and 5131(a), is amended--
(A) in paragraph (13), by striking ``or'' at the
end,
(B) in paragraph (14), by striking the period at
the end and inserting ``; or'', and
(C) by inserting after paragraph (14) the following
new paragraph:
``(15) with respect to any amount expended for a single-
antigen vaccine and its administration in any case in which the
administration of a combined-antigen vaccine was medically
appropriate (as determined by the Secretary).''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply to amounts expended for vaccines administered on or
after October 1, 1993.
(e) Requiring Medicaid Managed Care Plans to Comply with
Immunization and Other EPSDT Requirements.--
(1) In general.--Section 1903(m) (42 U.S.C. 1396b(m)) is
amended--
(A) in paragraph (2)(A), as amended by subsections
(a)(1) and (b)(1) of section 5135--
(i) by striking ``and'' at the end of
clause (xii),
(ii) by striking the period at the end of
clause (xiii) and inserting ``; and'', and
(iii) by adding at the end the following
new clause:
``(xiv) the entity complies with the requirements of
paragraph (7) (relating to EPSDT compliance).''; and
(B) by adding at the end the following new
paragraph:
``(7) The contract between the State and an entity referred to in
paragraph (2)(A)(iii) shall--
``(A) specify which early and periodic screening,
diagnostic, and treatment services are to be provided under the
contract to individuals under age 21 enrolled with the entity;
``(B) in the case of such services which are not to be so
provided, specify the steps the entity will take (through
referrals or other arrangements) to assure that such
individuals will receive such services; and
``(C) require the entity to submit such periodic reports as
may be necessary to enable the State to prepare and submit
timely reports under section 1902(a)(43)(D) and section
506(a)(2).''.
(2) Application of intermediate sanctions for failure to
provide immuniza- tions and other epsdt services.--Section
1903(m)(5)(A) (42 U.S.C. 1396b(m)(5)(A)) is amended--
(A) by striking ``, or'' at the end of clause (iv)
and inserting a semicolon,
(B) by striking the comma at the end of clause (v)
and inserting ``; or'', and
(C) by inserting after clause (v) the following new
clause:
``(vi) fails substantially to provide early and periodic
screening, diagnostic, and treatment services to the extent
specified in the contract under paragraph (7)(A);''.
(3) Effective date.--The amendments made by this subsection
shall apply to contract years beginning on or after October 1,
1993, without regard to whether or not final regulations to
carry out such amendments have been promulgated by such date.
(f) Transition Rule.--
(1) Medicaid use of cdc contract price.--The Secretary of
Health and Human Services shall not, on or after the date of
the enactment of this Act, enter into a contract for the
purchase by the Centers for Disease Control and Prevention of
pediatric vaccines for distribution (as provided for in section
317 or section 2181 of the Public Health Service Act) unless
such contract provides that the charge for such vaccines, for
which medical assistance is provided under a State plan under
title XIX of the Social Security Act, will not exceed the price
negotiated under the contract. The previous sentence shall not
apply, with respect to a vaccine for which medical assistance
is provided by a State, on and after such date as the State
becomes entitled to have the Secretary provide for the purchase
and delivery on behalf of the State of that vaccine under
section 2151 of the Public Health Service Act.
(2) Optional use by states of cdc contract price.--Nothing
in paragraph (1) shall be construed as limiting the Federal
financial participation available to States, under title XIX of
the Social Security Act, for the cost of a pediatric vaccine to
the contract price described in such paragraph for the vaccine.
SEC. 5184. AVAILABILITY OF MEDICAID PAYMENTS FOR CHILDHOOD VACCINE
REPLACEMENT PROGRAMS.
(a) In General.--Section 1902(a)(32) (42 U.S.C. 1396a(a)(32)) is
amended--
(1) by striking ``and'' at the end of subparagraph (B),
(2) by striking the period at the end of subparagraph (C)
and inserting ``; and'', and
(3) by adding at the end the following new subparagraph:
``(D) in the case of payment for a childhood
vaccine administered to individuals entitled to medical
assistance under the State plan, the State plan may
make payment directly to the manufacturer of the
vaccine under a voluntary replacement program agreed to
by the State pursuant to which the manufacturer (i)
supplies doses of the vaccine to providers
administering the vaccine, (ii) periodically replaces
the supply of the vaccine, and (iii) charges the State
the manufacturer's bid price to the Centers for Disease
Control and Prevention for the vaccine so administered
plus a reasonable premium to cover shipping and the
handling of returns;''.
(b) Effective Date.--The amendments made by subsection (a) shall
take effect on the date of the enactment of this Act.
SEC. 5185. HEALTHY START FOR INFANTS.
(a) In General.--Part D of title III of the Public Health Service
Act (42 U.S.C. 254b et seq.) is amended by inserting after section 330
the following section:
``healthy start for infants
``Sec. 330A. (a) Grants for Comprehensive Services.--
``(1) In general.--The Secretary may make grants for the
operation of not more than 21 demonstration projects to provide
the services described in subsection (b) for the purpose of
reducing, in the geographic areas in which the projects are
carried out--
``(A) the incidence of infant mortality and
morbidity;
``(B) the incidence of fetal deaths;
``(C) the incidence of maternal mortality;
``(D) the incidence of fetal alcohol syndrome; and
``(E) the incidence of low-birthweight births.
``(2) Achievement of year 2000 health status objectives.--
With respect to the objectives established by the Secretary for
the health status of the population of the United States for
the year 2000, the Secretary shall, in providing for a
demonstration project under paragraph (1) in a geographic area,
seek to meet the objectives that are applicable to the purpose
described in such paragraph and the populations served by the
project.
``(b) Authorized Services.--
``(1) In general.--Subject to subsection (h), the services
referred to in this subsection are comprehensive services
(including preventive and primary health services for pregnant
women and infants and childhood immunizations in accordance
with the schedule recommended by the Secretary under section
2160) for carrying out the purpose described in subsection (a),
including services other than health services.
``(2) Certain providers.--The Secretary may make a grant
under subsection (a) only if the applicant involved agrees
that, in making any arrangements under which other entities
provide authorized services in the demonstration project
involved, the applicant will include among the entities with
which the arrangements are made grantees under any of sections
329, 330, 340, and 340A, if such grantees are providing
services in the service area of such project and the grantees
are willing to make such arrangements with the applicant.
``(c) Eligible Geographic Areas.--The Secretary may make a grant
under subsection (a) only if--
``(1) the applicant for the grant specifies the geographic
area in which the demonstration project under such subsection
is to be carried out and agrees that the project will not be
carried out in other areas; and
``(2) the rate of infant mortality in the geographic area
equals or exceeds 150 percent of the national average in the
United States of such rates.
``(d) Minimum Qualifications of Grantees.--
``(1) Public or nonprofit private entities.--The Secretary
may make a grant under subsection (a) only if the applicant for
the grant is a State or local department of health, or other
public or nonprofit private entity, or a consortium of public
or nonprofit private entities.
``(2) Approval of political subdivisions.--With respect to
a proposed demonstration project under subsection (a), the
Secretary may make a grant under such subsection only if--
``(A) the chief executive officer of each political
subdivision in the service area of such project
approves the applicant for the grant as being qualified
to carry out the project; and
``(B) the leadership of any Indian tribe or tribal
organization with jurisdiction over any portion of such
area so approves the applicant.
``(3) Status as medicaid provider.--
``(A) In the case of any service described in
subsection (b) that is available pursuant to the State
plan approved under title XIX of the Social Security
Act for a State in which a demonstration project under
subsection (a) is carried out, the Secretary may make a
grant under such subsection for the project only if,
subject to subparagraph (B)--
``(i) the applicant for the grant will
provide the service directly, and the applicant
has entered into a participation agreement
under the State plan and is qualified to
receive payments under such plan; or
``(ii) the applicant will enter into an
agreement with a public or private entity under
which the entity will provide the service, and
the entity has entered into such a
participation agreement under the State plan
and is qualified to receive such payments.
``(B)(i) In the case of an entity making an
agreement pursuant to subparagraph (A)(ii) regarding
the provision of services, the requirement established
in such subparagraph regarding a participation
agreement shall be waived by the Secretary if the
entity does not, in providing health care services,
impose a charge or accept reimbursement available from
any third-party payor, including reimbursement under
any insurance policy or under any Federal or State
health benefits plan.
``(ii) A determination by the Secretary of whether
an entity referred to in clause (i) meets the criteria
for a waiver under such clause shall be made without
regard to whether the entity accepts voluntary
donations regarding the provision of services to the
public.
``(e) State Approval of Project.--With respect to a proposed
demonstration project under subsection (a), the Secretary may make a
grant under such subsection to the applicant involved only if--
``(1) the chief executive officer of the State in which the
project is to be carried out approves the proposal of the
applicant for carrying out the project; and
``(2) the leadership of any Indian tribe or tribal
organization with jurisdiction over any portion of the service
area of the project so approves the proposal.
``(f) Eligibility for Services Provided With Grant Funds.--
``(1) In general.--With respect to any authorized service
under subsection (b), if the service is a service that States
are required or authorized to provide under title XIX of the
Social Security Act, the Secretary may make a grant under
subsection (a) only if the applicant involved agrees that the
grant will not be expended to provide the service to any
individual to whom States are required or authorized under such
title to provide the service. The Secretary may not make a
grant under subsection (a) unless the State involved agrees
that the grant will not be expended to make payment for any
item or service to the extent that payment has been made, or
can reasonably be expected to be made, with respect to such
item or service--
``(A) under a health insurance policy or plan
(including a group health plan or a prepaid health
plan),
``(B) under any Federal or State health benefits
program, including any program under title V, XVIII, or
XIX of the Social Security Act, or
``(C) under subpart 2 of part B of title XIX of
this Act.
``(2) Rules of construction.--For purposes of paragraph
(1):
``(A) Individuals to whom States are authorized to
provide services under title XIX of the Social Security
Act include, pursuant to section 1902(l) of such title,
pregnant women, infants, and children with an income
level not less than 133 percent, and not more than 185
percent, of the official poverty line.
``(B) Authorized services under subsection (b) that
are authorized to be provided under title XIX of such
Act include, pursuant to section 1920 of such title,
ambulatory prenatal services during a period of
presumptive eligibility.
``(C) Authorized services under subsection (b) that
are required to be provided under title XIX of such Act
include, pursuant to section 1905(a)(4)(B) of such
title, early and periodic screening, diagnostic, and
treatment services for children under the age of 21.
``(D) Authorized services under subsection (b) that
are authorized to be provided under title XIX of such
Act include, pursuant to section 1905(a)(19) of such
title, case-management services.
``(g) Maintenance of Effort.--
``(1) Grantee.--With respect to authorized services under
subsection (b), the Secretary may make a grant under subsection
(a) only if the applicant involved agrees to maintain
expenditures of non-Federal amounts for such services at a
level that is not less than the level of such expenditures
maintained by the applicant for fiscal year 1991.
``(2) Relevant political subdivisions.--With respect to
authorized services under subsection (b), the Secretary may
make a grant under subsection (a) only if each political
subdivision in the service area of the demonstration project
involved agrees to maintain expenditures of non-Federal amounts
for such services at a level that is not less than the level of
such expenditures maintained by the political subdivision for
fiscal year 1991.
``(h) Restrictions on Expenditure of Grant.--
``(1) In general.--Except as provided in paragraph (3), the
Secretary may make a grant under subsection (a) only if the
applicant involved agrees that the grant will not be expended--
``(A) to provide inpatient services, except with
respect to residential treatment for substance abuse
provided in settings other than hospitals;
``(B) to make cash payments to intended recipients
of health services or mental health services; or
``(C) to purchase or improve real property (other
than minor remodeling of existing improvements to real
property) or to purchase major medical equipment (other
than mobile medical units for providing ambulatory
prenatal services).
``(2) Administrative expenses; data collection.--The
Secretary may make a grant under subsection (a) only if the
applicant involved agrees that not more than an aggregate 10
percent of the grant will be expended for administering the
grant and the collection and analysis of data.
``(3) Waiver.--If the Secretary finds that the purpose
described in subsection (a) cannot otherwise be carried out,
the Secretary may, with respect to an otherwise qualified
applicant, waive the restriction established in paragraph
(1)(C).
``(i) Determination of Cause of Infant Deaths.--The Secretary may
make a grant under subsection (a) only if the applicant involved--
``(1) agrees to provide for a determination of the cause of
each infant death in the service area of the demonstration
project involved; and
``(2) the applicant has made such arrangements with public
entities as may be necessary to carry out paragraph (1).
``(j) Annual Reports to Secretary.--The Secretary may make a grant
under subsection (a) only if the applicant involved agrees that, for
each fiscal year for which the applicant operates a demonstration
project under such subsection the applicant will, not later than April
1 of the subsequent fiscal year, submit to the Secretary a report
providing the following information with respect to the project:
``(1) The number of individuals that received authorized
services, and the demographic characteristics of the population
of such individuals.
``(2) The types of authorized services provided, including
the types of ambulatory prenatal services provided and the
trimester of the pregnancy in which the services were provided.
``(3) The sources of payment for the authorized services
provided.
``(4) The extent to which children under age 2 receiving
authorized services have received the appropriate number and
variety of immunizations against vaccine-preventable diseases.
``(5) An analysis of the causes of death determined under
subsection (i).
``(6) The extent of progress being made toward meeting the
health status objectives specified in subsection (a)(2).
``(7) The extent to which, in the service area involved,
progress is being made toward meeting the participation goals
established for the State by the Secretary under section
1905(r) of the Social Security Act (relating to early periodic
screening, diagnostic, and treatment services for children
under the age of 21).
``(k) Community Participation.--The Secretary may make a grant
under subsection (a) only if the applicant involved agrees that, in
preparing the proposal of the applicant for the demonstration project
involved, and in the operation of the project, the applicant will
consult with the residents of the service area for the project and with
public and nonprofit private entities that provide authorized services
to such residents.
``(l) Application for Grant.--The Secretary may make a grant under
subsection (a) only if an application for the grant is submitted to the
Secretary and the application is in such form, is made in such manner,
and contains such agreements, assurances, and information as the
Secretary determines to be necessary to carry out this subsection.
``(m) Report to Congress.--Not later than February 1, 1998, the
Secretary shall submit to the Committee on Energy and Commerce of the
House of Representatives, and the Committee on Labor and Human
Resources of the Senate, a report--
``(1) summarizing the reports received by the Secretary
under subsection (j);
``(2) describing the extent to which demonstration projects
under subsection (a) have been cost effective; and
``(3) describing the extent to which the Secretary has, in
the service areas of such projects, been successful in meeting
the health status objectives specified in subsection (a)(2).
``(n) Limitation on Certain Expenses of Secretary.--Of the amounts
appropriated under subsection (o) for a fiscal year, the Secretary may
not obligate more than an aggregate 5 percent for the administrative
costs of the Secretary in carrying out this section, for the provision
of technical assistance regarding demonstration projects under
subsection (a), and for evaluations of such projects.
``(o) Definitions.--For purposes of this section:
``(1) The term `authorized services' means the services
specified in subsection (b).
``(2) The terms `Indian tribe' and `tribal organization'
have the meaning given such terms in section 4(b) and section
4(c) of the Indian Self-Determination and Education Assistance
Act.
``(3) The term `service area', with respect to a
demonstration project under subsection (a), means the
geographic area specified in subsection (c).
``(p) Authorization of Appropriations.--For the purpose of carrying
out this section, there are authorized to be appropriated for each of
the fiscal years 1994 through 1997 such sums as may be necessary.
``(q) Sunset.--Effective October 1, 1997, this section is
repealed.''.
(b) Report for Fiscal Year 1993.--With respect to grants under
section 330A of the Public Health Service Act, as added by subsection
(a) of this section, the Secretary of Health and Human Services may
make a grant under such section for fiscal year 1994 only if the
applicant for the grant agrees to submit to the Secretary, not later
than April 1 of such year, a report on any federally-supported project
of the applicant that is substantially similar to the demonstration
projects authorized in such section 330A, which report provides, to the
extent practicable, the information described in subsection (j) of such
section.
(c) Savings Provision.--With respect to grants under section 330A
of the Public Health Service Act, as added by subsection (a) of this
section and in effect for the fiscal years 1994 through 1997, such
grants remain available for obligation and expenditure in accordance
with the terms upon which the grants were made, notwithstanding the
repeal of such section 330A pursuant to subsection (q) of such section.
(d) Use of General Authority Under Public Health Service Act.--With
respect to the program established in section 330A of the Public Health
Service Act, as added by subsection (a) of this section, section 301 of
the Public Health Service Act may not be construed as providing to the
Secretary of Health and Human Services any authority to carry out,
during any fiscal year in which such program is in operation, any
demonstration project to provide any of the services specified in
subsection (b) of such section 330A.
SEC. 5186. INCREASE IN AUTHORIZATION OF APPROPRIATIONS FOR THE MATERNAL
AND CHILD HEALTH SERVICES BLOCK GRANT PROGRAM.
Section 501(a) (42 U.S.C. 701(a)) is amended by striking
``$686,000,000 for fiscal year 1990'' and inserting ``$705,000,000 for
fiscal year 1994''.
SEC. 5187. MISCELLANEOUS TECHNICAL CORRECTIONS TO PUBLIC HEALTH SERVICE
ACT PROVISIONS.
(a) Compensation for Members of National Advisory Council on
National Health Service Corps.--
(1) In General.--Section 337(b)(2) of the Public Health Service Act
(42 U.S.C. 254j(b)(2)) is amended--
(A) by inserting after ``so serving'' the
following: ``compensation at a rate fixed by the
Secretary (but not to exceed'', and
(B) by striking ``Schedule;'' and inserting
``Schedule);''.
(2) Effective date.--The amendments made by paragraph (1)
shall take effect on the date of the enactment of this Act.
(b) Liability Protections for Individuals Providing Services at
Certain Clinics.--
(1) Clarification of voluntary participation by certain
entities.--(A) Section 224(g) of the Public Health Service Act
(42 U.S.C. 133(g)(1)), as added by section 2(a) of the
Federally Supported Health Centers Assistance Act of 1992, is
amended--
(i) in paragraph (4), by striking ``An entity'' and
inserting ``Except as provided in paragraph (6), an
entity'', and
(ii) by adding at the end the following new
paragraph:
``(6) An entity may elect not to be treated as being described in
paragraph (4) if the entity establishes that on a continuous basis
since October 24, 1992, the entity has been a participant in, and
partial owner of, a nonprofit risk retention group which offers
malpractice and other liability coverage to the entity.''.
(B) Section 224(k)(2) of such Act (42 U.S.C. 233(k)(2)), as
added by section 4 of the Federally Supported Health Centers
Assistance Act of 1992, is amended by striking ``entities
receiving funds'' and all that follows through ``subsection
(g)'' and inserting the following: ``entities described in
subsection (g)(4) and receiving funds under each of the grant
programs described in such subsection''.
(2) Clarification of coverage of officers and employees of
clinics.--The first sentence of section 224(g)(1) of the Public
Health Service Act (42 U.S.C. 233(g)(1)) is amended by striking
``officer, employee, or contractor'' and inserting the
following: ``officer or employee of such an entity, and any
contractor''.
(3) Coverage for services furnished to individuals other
than patients of clinic.--Section 224(g) of such Act (42 U.S.C.
233(g)(1)), as amended by paragraph (1), is amended--
(A) in the first sentence of paragraph (1), by
inserting after ``Service'' the following: ``with
respect to services provided to patients of the entity
and (subject to paragraph (7)) to certain other
individuals''; and
(B) by adding at the end the following new
paragraph:
``(7) For purposes of paragraph (1), an officer, employee, or
contractor described in such paragraph may be deemed to be an employee
of the Public Health Service with respect to services provided to
individuals who are not patients of an entity described in paragraph
(4) only if the Secretary determines--
``(A) that the provision of the services to such
individuals is necessary to assure the treatment of patients of
such an entity; or
``(B) that such services are otherwise required to be
provided to such individuals under an employment contract (or
other similar arrangement) between the individual and the
entity.''.
(4) Determining compliance of entity with requirements for
coverage.--Section 224(h) of such Act (42 U.S.C. 233(h)), as
added by section 2(b) of the Federally Supported Health Centers
Assistance Act of 1992, is amended by striking ``the entity--''
and inserting the following: ``the Secretary, after receiving
such assurances and conducting such investigation as the
Secretary considers necessary, finds that the entity--''.
(5) Effective date.--The amendments made by this subsection
shall take effect as if included in the enactment of the
Federally Supported Health Centers Assistance Act of 1992.
(c) Elimination of Duplicate Waiver Authority for Participants in
National Health Service Corps.--Section 338E(c) of the Public Health
Service Act (42 U.S.C. 254o(c)) is amended by striking paragraph (3)
and redesignating paragraph (4) as paragraph (3).
(d) Clarification of Prohibition Against Resale of Drugs Under Drug
Rebate Agreements.--Section 340B(a)(5)(B) of the Public Health Service
Act (42 U.S.C. 256b(a)(5)(B)), as added by section 602(a) of the
Veterans Health Care of 1992, is amended by striking ``entity.'' and
inserting ``covered entity.''.
Subtitle C--Communications Licensing Improvement
SEC. 5200. TABLE OF CONTENTS.
The table of contents is as follows:
Subtitle C--Communications Licensing Improvement
Sec. 5200. Table of contents.
Chapter 1--Competitive Bidding Authority
Sec. 5201. Short title.
Sec. 5202. Findings.
Sec. 5203. Authority to use competitive bidding.
Sec. 5204. Conforming amendments.
Sec. 5205. Regulatory parity.
Sec. 5206. Effective dates; deadlines for Commission action.
Chapter 2--Emerging Telecommunications Technologies
Sec. 5221. Short title.
Sec. 5222. Amendment to the National Telecommunications and Information
Administration Organization Act.
Chapter 3--Communications Technical Amendments
Sec. 5241. Clerical corrections.
Sec. 5242. Transfer of provisions of law concerning public
telecommunications facilities, children's
educational television, and
telecommunications demonstration program.
Sec. 5243. Elimination of expired and outdated provisions.
Sec. 5244. Stylistic consistency.
CHAPTER 1--COMPETITIVE BIDDING AUTHORITY
SEC. 5201. SHORT TITLE.
This chapter may be cited as the ``Licensing Improvement Act of
1993''.
SEC. 5202. FINDINGS.
The Congress finds that--
(1) current licensing procedures often delay delivery of
services to the public and can result in the unjust enrichment
of applicants on the basis of the value of the public airwaves;
(2) if licensees are engaged in reselling the use of the
public airwaves to subscribers for a fee, the licensee should
pay reasonable compensation to the public for those public
resources;
(3) a carefully designed system to obtain competitive bids
from competing qualified applicants can speed delivery of
services, promote efficient and intensive use of the
electromagnetic spectrum, prevent unjust enrichment, and
produce revenues to compensate the public for the use of the
public airwaves; and
(4) therefore, the Federal Communications Commission should
have the authority to differentiate among multiple qualified
applicants for a single license using a system of competitive
bids.
SEC. 5203. AUTHORITY TO USE COMPETITIVE BIDDING.
Section 309 of the Communications Act of 1934 (47 U.S.C. 309) is
amended by adding at the end the following new subsection:
``(j) Use of Competitive Bidding.--
``(1) General authority.--If mutually exclusive
applications are filed for any initial license or construction
permit which will involve a use of the electromagnetic spectrum
described in paragraph (2), then the Commission shall have the
authority to grant such license or permit to a qualified
applicant through the use of a system of competitive bidding
that meets the requirements of this subsection.
``(2) Uses to which bidding may apply.--A use of the
electromagnetic spectrum is described in this paragraph if the
Commission determines that--
``(A) the principal use of such spectrum will
involve, or is reasonably likely to involve, the
licensee receiving compensation from subscribers in
return--
``(i) for the licensee enabling those
subscribers to receive communications signals
that are transmitted utilizing frequencies on
which the licensee is licensed to operate; or
``(ii) for the licensee enabling those
subscribers to transmit directly communications
signals utilizing frequencies on which the
licensee is licensed to operate; and
``(B) a system of competitive bidding will promote
the objectives described in paragraph (3).
``(3) Design of systems of competitive bidding.--For each
license or permit, or class of licenses or permits, that the
Commission grants through the use of a competitive bidding
system, the Commission shall, by rule, establish a competitive
bidding methodology. The Commission shall seek to design and
test multiple alternative methodologies under appropriate
circumstances. In identifying licenses and permits to be issued
by competitive bidding, in specifying eligibility and other
characteristics of such licenses and permits, and in designing
the methodologies for use under this subsection, the Commission
shall seek to promote the purposes specified in section 1 of
this Act and the following objectives:
``(A) the development and rapid deployment of new
technologies, products, and services for the benefit of
the public, including those residing in rural areas,
without administrative or judicial delays;
``(B) promoting economic opportunity and
competition and ensuring that new and innovative
technologies are readily accessible to the American
people by avoiding excessive concentration of licenses
and by disseminating licenses among a wide variety of
applicants, including small businesses and businesses
owned by members of minority groups and women;
``(C) recovery for the public of a portion of the
value of the public spectrum resource made available
for commercial use and avoidance of unjust enrichment
through the methods employed to award uses of that
resource; and
``(D) efficient and intensive use of the
electromagnetic spectrum.
``(4) Contents of regulations.--In prescribing rules
pursuant to paragraph (3), the Commission shall--
``(A) consider alternative payment schedules and
methods of calculation, including initial lump sums,
installment or royalty payments, guaranteed annual
minimum payments, or other schedules or methods that
promote the objectives described in paragraph (3)(B),
and combinations of such schedules and methods;
``(B) include performance requirements, such as
appropriate deadlines and penalties for performance
failures, to ensure prompt delivery of service to rural
areas, to prevent stockpiling or warehousing of
spectrum by licensees or permittees, and to promote
investment in and rapid deployment of new technologies
and services;
``(C) consistent with the public interest,
convenience, and necessity, the purposes of this Act,
and the characteristics of the proposed service,
prescribe area designations and bandwidth assignments
that promote (i) an equitable distribution of licenses
and services among geographic areas, (ii) economic
opportunity for a wide variety of applicants, including
small businesses and businesses owned by members of
minority groups and women, and (iii) investment in and
rapid deployment of new technologies and services; and
``(D) require such transfer disclosures and
antitrafficking restrictions and payment schedules as
may be necessary to prevent unjust enrichment as a
result of the methods employed to issue licenses and
permits.
``(5) Bidder and licensee qualification.--No person shall
be permitted to participate in a system of competitive bidding
pursuant to this subsection unless such bidder submits such
information and assurances as the Commission may require to
demonstrate that such bidder's application is acceptable for
filing. No license shall be granted to an applicant selected
pursuant to this subsection unless the Commission determines
that the applicant is qualified pursuant to subsection (a) and
sections 308(b) and 310. Consistent with the objectives
described in paragraph (3), the Commission shall, by rule,
prescribe expedited procedures consistent with the procedures
authorized by subsection (i)(2) for the resolution of any
substantial and material issues of fact concerning
qualifications.
``(6) Rules of construction.--Nothing in this subsection,
or in the use of competitive bidding, shall--
``(A) limit or otherwise affect the requirements of
subsection (h) of this section, section 301, 304, 307,
310, or 706, or any other provision of this Act (other
than subsections (d)(2) and (e) of this section);
``(B) be construed to convey any rights, including
any expectation of renewal of a license, that differ
from the rights that apply to other licenses within the
same service that were not issued pursuant to this
subsection; or
``(C) be construed to prohibit the Commission from
issuing nationwide licenses or permits.
``(7) Limitation of effect on allocation decisions.--In
making a decision pursuant to section 303(c) to assign a band
of frequencies to a use for which licenses or permits will be
issued pursuant to this subsection, and in prescribing
regulations pursuant to paragraph (4)(A) and (4)(C) of this
subsection, the Commission may not base a finding of public
interest, convenience, and necessity solely or predominantly on
the expectation of Federal revenues from the use of a system of
competitive bidding under this subsection.
``(8) Treatment of revenues.--All proceeds from the use of
a competitive bidding system under this subsection shall be
deposited in the Treasury in accordance with chapter 33 of
title 31, United States Code. A license or permit issued by the
Commission under this section shall not be treated as the
property of the licensee for tax purposes by any State or local
government entity.
``(9) Termination; evaluation.--The authority of the
Commission to grant a license or permit under this subsection
shall expire September 30, 1998. Not later than September 30,
1997, the Commission shall conduct a public inquiry and submit
to the Congress a report--
``(A) describing the methodologies established by
the Commission pursuant to paragraphs (3) and (4);
``(B) comparing the relative advantages and
disadvantages of such methodologies in terms of
attaining the objectives described in such paragraphs;
``(C) evaluating the extent to which such
methodologies have secured prompt delivery of service
to rural areas; and
``(D) containing a statement of the revenues
obtained, and a projection of the future revenues, from
the use of competitive bidding systems under this
subsection.''.
SEC. 5204. CONFORMING AMENDMENTS.
Section 309 of the Communications Act of 1934 is further amended--
(1) by striking subsection (i)(1) and inserting the
following:
``(i) Random Selection.--
``(1) General authority.--If--
``(A) there is more than one application for any
initial license or construction permit which will
involve a use of the electromagnetic spectrum; and
``(B) the Commission has determined that the use is
not described in subsection (j)(2)(A);
then the Commission shall have the authority to grant such
license or permit to a qualified applicant through the use of a
system of random selection.'';
(2) in paragraph (2)--
(A) by indenting paragraph (2), including
subparagraphs (A) through (C), by an additional 2 em
spaces; and
(B) by inserting ``Determinations of
qualifications.--'' after ``(2)'';
(3) in paragraph (3)--
(A) by indenting subparagraphs (A) and (B), and so
much of subparagraph (C) as precedes clause (i), by an
additional 2 em spaces;
(B) by indenting clauses (i) and (ii) of
subparagraph (C) by an additional 4 em spaces; and
(C) by inserting ``Preferences; diversity.--''
after ``(3)'';
(4) in paragraph (4)--
(A) by indenting subparagraphs (A) and (B) of such
paragraph by an additional 2 em spaces;
(B) by inserting ``Rulemaking schedule and
authority.--'' after ``(4)''; and
(C) by adding at the end the following new
subparagraph:
``(C) Not later than 180 days after the date of enactment
of this subparagraph, the Commission shall prescribe such
transfer disclosures and antitrafficking restrictions and
payment schedules as are necessary to prevent the unjust
enrichment of recipients of licenses or permits as a result of
the methods employed to issue licenses under this
subsection.''.
SEC. 5205. REGULATORY PARITY.
(a) Amendment.--Section 332 of the Communications Act of 1934 (47
U.S.C. 332) is amended--
(1) by striking ``private land'' from the heading of the
section; and
(2) by amending striking subsection (c) and inserting the
following:
``(c) Regulatory Treatment of Mobile Services.--
``(1) Common carrier treatment of commercial mobile
services.--(A) A person engaged in the provision of commercial
mobile services shall, insofar as such person is so engaged, be
treated as a common carrier for purposes of this Act, except
for such provisions of title II as the Commission may,
consistent with the public interest, specify as inapplicable by
rule. In prescribing any such rule, the Commission may not
specify section 201, 202, or 208, or any other provision that
the Commission determines to be necessary in order to ensure
that the charges, practices, classifications, or regulations
for or in connection with commercial mobile services are just
and reasonable and are not unjustly or unreasonably
discriminatory or is otherwise in the public interest.
``(B) Upon reasonable request of any person providing
commercial mobile service, the Commission shall order a common
carrier to establish physical connections with such service
pursuant to the provisions of section 201 of this Act. Except
to the extent that the Commission is required to respond to
such a request, this subparagraph shall not be construed as a
limitation or expansion of the Commission's authority to order
interconnection pursuant to this Act.
``(2) Noncommon carrier treatment of private land mobile
services.--A person engaged in private land mobile service
shall not, insofar as such person is so engaged, be treated as
a common carrier for any purpose under this Act. A common
carrier (other than a person that was treated as provider of
private land mobile services prior to the enactment of the
Licensing Improvement Act of 1993) shall not provide any
dispatch service on any frequency allocated for common carrier
service, except to the extent such dispatch service is provided
on stations licensed in the domestic public land mobile radio
service before January 1, 1982. The Commission may by
regulation terminate, in whole or in part, the prohibition
contained in the preceding sentence if the Commission
determines that such termination will serve the public
interest.
``(3) State authority to regulate.--(A) Notwithstanding
sections 2(b) and 221(b), no State or local government shall
have any authority to impose any rate or entry regulation upon
any commercial mobile service or any private land mobile
service, except that this paragraph shall not prohibit a State
from regulating the other terms and conditions of commercial
mobile services.
``(B) Notwithstanding subparagraph (A), a State may
petition the Commission for authority to regulate the rates for
any commercial mobile service and the Commission shall grant
such petition if such State demonstrates that (i) such service
is a substitute for land line telephone exchange service for a
substantial portion of the public within such State, or (ii)
market conditions with respect to such services fail to protect
subscribers adequately from unjust and unreasonable rates or
rates that are unjustly or unreasonably discriminatory. The
Commission shall provide reasonable opportunity for public
comment in response to such petition, and shall, within 9
months after the date of its submission, grant or deny such
petition. If the Commission grants such petition, the
Commission shall authorize the State to exercise under State
law such authority over rates, for such periods of time, as the
Commission deems necessary to ensure that such rates are just
and reasonable and not unjustly or unreasonably discriminatory.
``(4) Regulatory treatment of communications satellite
corporation.--Nothing in this subsection shall be construed to
alter or affect the regulatory treatment required by title IV
of the Communications Satellite of 1962 of the corporation
authorized by title III of such Act.
``(d) Definitions.--For purposes of this section--
``(1) the term `commercial mobile service' means all mobile
services (as defined in section 3(n)) that--
``(A) are provided for profit (i) to the public,
(ii) on an indiscriminate basis, or (iii) to such broad
classes of eligible users as to be effectively
available to a substantial portion of the public; and
``(B) are interconnected (or have requested
interconnection pursuant to paragraph (1)(B)) with the
public switched network (as such terms are defined by
regulation by the Commission); and
``(2) the term `private mobile service' means any mobile
service (as defined in section 3(n)) that is not a commercial
mobile service.''.
(b) Conforming Amendments.--
(1) Amendments to definitions.--Section 3 of the
Communications Act of 1934 (47 U.S.C. 153) is amended--
(A) in subsection (n)--
(i) by inserting ``(1)'' after ``and
includes''; and
(ii) by inserting before the period at the
end the following: ``, (2) a mobile service
which provides a regularly interacting group of
base, mobile, portable, and associated control
and relay stations (whether licensed on an
individual, cooperative, or multiple basis) for
private one-way or two-way land mobile radio
communications by eligible users over
designated areas of operation, and (3) any
service for which a license is required in a
personal communications service established
pursuant to the proceeding entitled `Amendment
of the Commission's Rules to Establish New
Personal Communications Services' (GEN Docket
No. 90-314; ET Docket No. 92-100), or any
successor proceeding''; and
(B) by striking subsection (gg).
(2) Conforming amendments to section 332.--Section 332 of
such Act is further amended--
(A) in subsection (a), by inserting after ``(a)''
the following: ``Management of Private Land Mobile
Frequencies.--'';
(B) in subsection (b)--
(i) by indenting the margin of paragraphs
(2) through (4) by 2 em spaces;
(ii) by striking ``(b)(1)'' and inserting
the following:
``(b) Use of Advisory Committee.--
``(1) Coordination of frequency assignment.--'';
(iii) by inserting ``Exemption.--'' after
``(2)'';
(iv) by inserting ``Nonemployee status.--''
after ``(3)''; and
(v) by inserting ``Application of federal
advisory committee act.--'' after ``(4).
SEC. 5206. EFFECTIVE DATES; DEADLINES FOR COMMISSION ACTION.
(a) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this chapter are effective on the date of
enactment of this Act.
(2) Effective date of mobile service amendments.--The
amendments made by section 5205 shall be effective 1 year after
such date of enactment, except that any person that provides
private land mobile services before such date of enactment
shall continue to be treated as a provider of private land
mobile service until 3 years after such date of enactment.
(b) Deadlines for Commission Action.--
(1) General rulemaking.--The Federal Communications
Commission shall prescribe rules to implement section 309(j) of
the Communications Act of 1934 (as added by this chapter)
within 210 days after the date of enactment of this Act.
(2) PCS orders and licensing.--The Commission shall--
(A) within 180 days after such date of enactment,
issue a final report and order (i) in the matter
entitled ``Redevelopment of Spectrum to Encourage
Innovation in the Use of New Telecommunications
Technologies'' (ET Docket No. 92-9); and (ii) in the
matter entitled ``Amendment of the Commission's Rules
to Establish New Personal Communications Services''
(GEN Docket No. 90-314; ET Docket No. 92-100); and
(B) within 270 days after such date of enactment,
commence issuing licenses and permits in the personal
communications service.
(3) Mobile service rulemaking required.--Within 1 year
after the date of enactment of this Act, the Federal
Communications Commission shall--
(A) issue such modifications or terminations of its
regulations concerning private land mobile services as
are necessary to implement the amendments made by
section 5205;
(B) make such other modifications of such
regulations as may be necessary to equalize the
regulatory treatment of providers of all commercial
mobile services that offer services that are
substantially similar; and
(C) include in such modifications and terminations
such provisions as are necessary to provide for an
orderly transition to the regulatory treatment required
by such amendments.
(c) Special Rule.--The Federal Communications Commission shall not
issue any license or permit pursuant to section 309(i) of the
Communications Act of 1934 after the date of enactment of this Act
unless the Commission has made the determination required by paragraph
(1)(B) of such section (as added by this chapter).
CHAPTER 2--EMERGING TELECOMMUNICATIONS TECHNOLOGIES
SEC. 5221. SHORT TITLE.
This chapter may be cited as the ``Emerging Telecommunications
Technologies Act of 1993''.
SEC. 5222. AMENDMENT TO THE NATIONAL TELECOMMUNICATIONS AND INFORMATION
ADMINISTRATION ORGANIZATION ACT.
The National Telecommunications and Information Administration
Organization Act is amended--
(1) by striking the heading of part B and inserting the
following:
``PART D--SPECIAL AND TEMPORARY PROVISIONS'';
(2) by redesignating sections 131 through 135 as sections
151 through 155, respectively; and
(3) by inserting after part A the following new part:
``PART B--EMERGING TELECOMMUNICATIONS TECHNOLOGIES
``SEC. 111. FINDINGS.
``The Congress finds that--
``(1) the Federal Government currently reserves for its own
use, or has priority of access to, approximately 40 percent of
the electromagnetic spectrum that is assigned for use pursuant
to the Communications Act of 1934;
``(2) many of such frequencies are underutilized by Federal
Government licensees;
``(3) the public interest requires that many of such
frequencies be utilized more efficiently by Federal Government
and non-Federal licensees;
``(4) additional frequencies are assigned for services that
could be obtained more efficiently from commercial carriers or
other vendors;
``(5) scarcity of assignable frequencies for licensing by
the Commission can and will--
``(A) impede the development and commercialization
of new telecommunications products and services;
``(B) limit the capacity and efficiency of the
United States telecommunications systems;
``(C) prevent some State and local police, fire,
and emergency services from obtaining urgently needed
radio channels; and
``(D) adversely affect the productive capacity and
international competitiveness of the United States
economy;
``(6) a reassignment of these frequencies can produce
significant economic returns; and
``(7) the Secretary of Commerce, the President, and the
Federal Communications Commission should be directed to take
appropriate steps to correct these deficiencies.
``SEC. 112. NATIONAL SPECTRUM PLANNING.
``(a) Planning Activities.--The Assistant Secretary and the
Chairman of the Commission shall meet, at least biannually, to conduct
joint spectrum planning with respect to the following issues--
``(1) the future spectrum requirements for public and
private uses, including State and local government public
safety agencies;
``(2) the spectrum allocation actions necessary to
accommodate those uses; and
``(3) actions necessary to promote the efficient use of the
spectrum, including spectrum management techniques to promote
increased shared use of the spectrum that does not cause
harmful interference as a means of increasing commercial
access.
``(b) Reports.--The Assistant Secretary and the Chairman of the
Commission shall submit a joint annual report to the Committee on
Energy and Commerce of the House of Representatives, the Committee on
Commerce, Science, and Transportation of the Senate, the Secretary, and
the Commission on the joint spectrum planning activities conducted
under subsection (a) and recommendations for action developed pursuant
to such activities.
``(c) Reporting Requirements.--The first annual report submitted
after the date of the report by the advisory committee under section
113(d)(4) shall--
``(1) include an analysis of and response to that committee
report; and
``(2) include an analysis of the effect on spectrum
efficiency and the cost of equipment to Federal spectrum users
of maintaining separate allocations for Federal Government and
non-Federal Government licensees for the same or similar
services.
``SEC. 113. IDENTIFICATION OF REALLOCABLE FREQUENCIES.
``(a) Identification Required.--The Secretary shall, within 24
months after the date of the enactment of this part, prepare and submit
to the President and the Congress a report identifying bands of
frequencies that--
``(1) are allocated on a primary basis for Federal
Government use and eligible for licensing pursuant to section
305(a) of the Act (47 U.S.C. 305(a));
``(2) are not required for the present or identifiable
future needs of the Federal Government;
``(3) can feasibly be made available, as of the date of
submission of the report or at any time during the next 15
years, for use under the Act (other than for Federal Government
stations under such section 305);
``(4) will not result in costs to the Federal Government,
or losses of services or benefits to the public, that are
excessive in relation to the benefits that may be obtained by
non-Federal licensees; and
``(5) are most likely to have the greatest potential for
productive uses and public benefits under the Act.
``(b) Minimum Amount of Spectrum Recommended.--
``(1) In general.--Based on the report required by
subsection (a), the Secretary shall recommend for reallocation,
for use other than by Federal Government stations under section
305 of the Act (47 U.S.C. 305), bands of frequencies that span
a total of not less than 200 megahertz, that are located below
6 gigahertz, and that meet the criteria specified in paragraphs
(1) through (4) of subsection (a). The Secretary may not
include, in such 200 megahertz, bands of frequencies that span
more than 20 megahertz and that are located between 5 and 6
gigahertz. If the report identifies (as meeting such criteria)
bands of frequencies spanning more than 200 megahertz, the
report shall identify and recommend for reallocation those
bands (spanning not less than 200 megahertz) that meet the
criteria specified in paragraph (5) of such subsection.
``(2) Mixed uses permitted to be counted.--Bands of
frequencies which the Secretary's report recommends be
partially retained for use by Federal Government stations, but
which are also recommended to be reallocated to be made
available under the Act for use by non-Federal stations, may be
counted toward the minimum spectrum required by paragraph (1)
of this subsection, except that--
``(A) the bands of frequencies counted under this
paragraph may not count toward more than one-half of
the minimum required by paragraph (1) of this
subsection;
``(B) a band of frequencies may not be counted
under this paragraph unless the assignments of the band
to Federal Government stations under section 305 of the
Act (47 U.S.C. 305) are limited by geographic area, by
time, or by other means so as to guarantee that the
potential use to be made by such Federal Government
stations is substantially less (as measured by
geographic area, time, or otherwise) than the potential
use to be made by non-Federal stations; and
``(C) the operational sharing permitted under this
paragraph shall be subject to coordination procedures
which the Commission shall establish and implement to
ensure against harmful interference.
``(c) Criteria for Identification.--
``(1) Needs of the federal government.--In determining
whether a band of frequencies meets the criteria specified in
subsection (a)(2), the Secretary shall--
``(A) consider whether the band of frequencies is
used to provide a communications service that is or
could be available from a commercial carrier or other
vendor;
``(B) seek to promote--
``(i) the maximum practicable reliance on
commercially available substitutes;
``(ii) the sharing of frequencies (as
permitted under subsection (b)(2));
``(iii) the development and use of new
communications technologies; and
``(iv) the use of nonradiating
communications systems where practicable; and
``(C) seek to avoid--
``(i) serious degradation of Federal
Government services and operations; and
``(ii) excessive costs to the Federal
Government and users of Federal Government
services.
``(2) Feasibility of use.--In determining whether a
frequency band meets the criteria specified in subsection
(a)(3), the Secretary shall--
``(A) assume such frequencies will be assigned by
the Commission under section 303 of the Act (47 U.S.C.
303) over the course of not less than 15 years;
``(B) assume reasonable rates of scientific
progress and growth of demand for telecommunications
services;
``(C) determine the extent to which the
reallocation or reassignment will relieve actual or
potential scarcity of frequencies available for
licensing by the Commission for non-Federal use;
``(D) seek to include frequencies which can be used
to stimulate the development of new technologies; and
``(E) consider the immediate and recurring costs to
reestablish services displaced by the reallocation of
spectrum.
``(3) Analysis of benefits.--In determining whether a band
of frequencies meets the criteria specified in subsection
(a)(4), the Secretary shall consider--
``(A) the extent to which equipment is or will be
available that is capable of utilizing the band;
``(B) the proximity of frequencies that are already
assigned for commercial or other non-Federal use; and
``(C) the activities of foreign governments in
making frequencies available for experimentation or
commercial assignments in order to support their
domestic manufacturers of equipment.
``(4) Power agency frequencies.--
``(A) Eligible for mixed use only.--The frequencies
assigned to any Federal power agency may only be
eligible for mixed use under subsection (b)(2) in
geographically separate areas and shall not be
recommended for the purposes of withdrawing that
assignment. In any case where a frequency is to be
shared by an affected Federal power agency and a non-
Federal user, such use by the non-Federal user shall,
consistent with the procedures established under
subsection (b)(2)(C), not cause harmful interference to
the affected Federal power agency or adversely affect
the reliability of its power system.
``(B) Definition.--As used in this paragraph, the
term `Federal power agency' means the Tennessee Valley
Authority, the Bonneville Power Administration, the
Western Area Power Administration, or the Southwestern
Power Administration.
``(d) Procedure for Identification of Reallocable Bands of
Frequencies.--
``(1) Submission of preliminary identification to
congress.--Within 12 months after the date of the enactment of
this part, the Secretary shall prepare and submit to the
Congress a report which makes a preliminary identification of
reallocable bands of frequencies which meet the criteria
established by this section.
``(2) Convening of advisory committee.--Not later than the
date the Secretary submits the report required by paragraph
(1), the Secretary shall convene an advisory committee to--
``(A) review the bands of frequencies identified in
such report;
``(B) advise the Secretary with respect to (i) the
bands of frequencies which should be included in the
final report required by subsection (a), and (ii) the
effective dates which should be established under
subsection (e) with respect to such frequencies;
``(C) receive public comment on the Secretary's
report and on the final report; and
``(D) prepare and submit the report required by
paragraph (4).
The advisory committee shall meet at least monthly until each
of the actions required by section 114(a) have taken place.
``(3) Composition of committee; chairman.--The advisory
committee shall include--
``(A) the Chairman of the Commission and the
Assistant Secretary, and one other representative of
the Federal Government as designated by the Secretary;
and
``(B) representatives of--
``(i) United States manufacturers of
spectrum-dependent telecommunications
equipment;
``(ii) commercial carriers;
``(iii) other users of the electromagnetic
spectrum, including radio and television
broadcast licensees, State and local public
safety agencies, and the aviation industry; and
``(iv) other interested members of the
public who are knowledgeable about the uses of
the electromagnetic spectrum.
A majority of the members of the committee shall be members
described in subparagraph (B), and one of such members shall be
designated as chairman by the Secretary.
``(4) Recommendations on spectrum allocation procedures.--
The advisory committee shall, not later than 36 months after
the date of the enactment of this part, submit to the
Secretary, the Commission, the Committee on Energy and Commerce
of the House of Representatives, and the Committee on Commerce,
Science, and Transportation of the Senate, a report containing
such recommendations as the advisory committee considers
appropriate for the reform of the process of allocating the
electromagnetic spectrum between Federal and non-Federal use,
and any dissenting views thereon.
``(e) Timetable for Reallocation and Limitation.--
``(1) Timetable required.--The Secretary shall, as part of
the report required by subsection (a), include a timetable that
recommends immediate and delayed effective dates by which the
President shall withdraw or limit assignments on the
frequencies specified in the report.
``(2) Expedited reallocation of initial 30 mhz permitted.--
The Secretary may prepare and submit to the President a report
which specifically identifies an initial 30 megahertz of
spectrum that meets the criteria described in subsection (a)
and that can be made available for reallocation immediately
upon issuance of the report required by this section.
``(3) Delayed effective date.--The recommended delayed
effective dates shall--
``(A) permit the earliest possible reallocation of
the frequency bands, taking into account the
requirements of section 115(1);
``(B) be based on the useful remaining life of
equipment that has been purchased or contracted for to
operate on identified frequencies;
``(C) be based on the need to coordinate frequency
use with other nations; and
``(D) take into account the relationship between
the costs to the Federal Government of changing to
different frequencies and the benefits that may be
obtained from commercial and other non-Federal uses of
the reassigned frequencies.
``SEC. 114. WITHDRAWAL OF ASSIGNMENT TO FEDERAL GOVERNMENT STATIONS.
``(a) In General.--The President shall--
``(1) within 6 months after receipt of the Secretary's
report under section 113(a), withdraw the assignment to a
Federal Government station of any frequency which the report
recommends for immediate reallocation;
``(2) within such 6-month period, limit the assignment to a
Federal Government station of any frequency which the report
recommends be made immediately available for mixed use under
section 113(b)(2);
``(3) by the delayed effective date recommended by the
Secretary under section 113(e) (except as provided in
subsection (b)(4) of this section), withdraw or limit the
assignment to a Federal Government station of any frequency
which the report recommends be reallocated or made available
for mixed use on such delayed effective date;
``(4) assign or reassign other frequencies to Federal
Government stations as necessary to adjust to such withdrawal
or limitation of assignments; and
``(5) transmit a notice and description to the Commission
and each House of Congress of the actions taken under this
subsection.
``(b) Exceptions.--
``(1) Authority to substitute.--If the President determines
that a circumstance described in paragraph (2) exists, the
President--
``(A) may substitute an alternative frequency or
band of frequencies for the frequency or band that is
subject to such determination and withdraw (or limit)
the assignment of that alternative frequency or band in
the manner required by subsection (a); and
``(B) shall submit a statement of the reasons for
taking the action described in subparagraph (A) to the
Committee on Energy and Commerce of the House of
Representatives and the Committee on Commerce, Science,
and Transportation of the Senate.
``(2) Grounds for substitution.--For purposes of paragraph
(1), the following circumstances are described in this
paragraph:
``(A) the reassignment would seriously jeopardize
the national defense interests of the United States;
``(B) the frequency proposed for reassignment is
uniquely suited to meeting important governmental
needs;
``(C) the reassignment would seriously jeopardize
public health or safety; or
``(D) the reassignment will result in costs to the
Federal Government that are excessive in relation to
the benefits that may be obtained from commercial or
other non-Federal uses of the reassigned frequency.
``(3) Criteria for substituted frequencies.--For purposes
of paragraph (1), a frequency may not be substituted for a
frequency identified by the report of the Secretary under
section 113(a) unless the substituted frequency also meets each
of the criteria specified by section 113(a).
``(4) Delays in implementation.--If the President
determines that any action cannot be completed by the delayed
effective date recommended by the Secretary pursuant to section
113(e), or that such an action by such date would result in a
frequency being unused as a consequence of the Commission's
plan under section 115, the President may--
``(A) withdraw or limit the assignment to Federal
Government stations on a later date that is consistent
with such plan, except that the President shall notify
each committee specified in paragraph (1)(B) and the
Commission of the reason that withdrawal or limitation
at a later date is required; or
``(B) substitute alternative frequencies pursuant
to the provisions of this subsection.
``(c) Limitation on Delegation.--Notwithstanding any other
provision of law, the authorities and duties established by this
section may not be delegated.
``SEC. 115. DISTRIBUTION OF FREQUENCIES BY THE COMMISSION.
``Not later than 1 year after the President notifies the Commission
pursuant to section 114(a)(5), the Commission shall prepare, in
consultation with the Assistant Secretary when necessary, and submit to
the President and the Congress, a plan for the distribution under the
Act of the frequency bands reallocated pursuant to the requirements of
this part. Such plan shall--
``(1) not propose the immediate distribution of all such
frequencies, but, taking into account the timetable recommended
by the Secretary pursuant to section 113(e), shall propose--
``(A) gradually to distribute the frequencies
remaining, after making the reservation required by
subparagraph (B), over the course of a period of not
less than 10 years beginning on the date of submission
of such plan; and
``(B) to reserve a significant portion of such
frequencies for distribution beginning after the end of
such 10-year period;
``(2) contain appropriate provisions to ensure--
``(A) the availability of frequencies for new
technologies and services in accordance with the
policies of section 7 of the Act (47 U.S.C. 157); and
``(B) the availability of frequencies to stimulate
the development of such technologies;
``(3) address (A) the feasibility of reallocating spectrum
from current commercial and other non-Federal uses to provide
for more efficient use of the spectrum, and (B) innovation and
marketplace developments that may affect the relative
efficiencies of different spectrum allocations; and
``(4) not prevent the Commission from allocating bands of
frequencies for specific uses in future rulemaking proceedings.
``SEC. 116. AUTHORITY TO RECOVER REASSIGNED FREQUENCIES.
``(a) Authority of President.--Subsequent to the withdrawal of
assignment to Federal Government stations pursuant to section 114, the
President may reclaim reassigned frequencies for reassignment to
Federal Government stations in accordance with this section.
``(b) Procedure for Reclaiming Frequencies.--
``(1) Unallocated frequencies.--If the frequencies to be
reclaimed have not been allocated or assigned by the Commission
pursuant to the Act, the President shall follow the procedures
for substitution of frequencies established by section 114(b)
of this part.
``(2) Allocated frequencies.--If the frequencies to be
reclaimed have been allocated or assigned by the Commission,
the President shall follow the procedures for substitution of
frequencies established by section 114(b) of this part, except
that the notification required by section 114(b)(1)(A) shall
include--
``(A) a timetable to accommodate an orderly
transition for licensees to obtain new frequencies and
equipment necessary for its utilization; and
``(B) an estimate of the cost of displacing
spectrum users licensed by the Commission.
``(c) Costs of Reclaiming Frequencies; Appropriations Authorized.--
The Federal Government shall bear all costs of reclaiming frequencies
pursuant to this section, including the cost of equipment which is
rendered unusable, the cost of relocating operations to a different
frequency band, and any other costs that are directly attributable to
the reclaiming of the frequency pursuant to this section. There are
authorized to be appropriated such sums as may be necessary to carry
out the purposes of this section.
``(d) Effective Date of Reclaimed Frequencies.--The Commission
shall not withdraw licenses for any reclaimed frequencies until the end
of the fiscal year following the fiscal year in which the President's
notification is received.
``(e) Effect on Other Law.--Nothing in this section shall be
construed to limit or otherwise affect the authority of the President
under sections 305 and 706 of the Act (47 U.S.C. 305, 606).
``SEC. 117. DEFINITIONS.
``As used in this part:
``(1) The term `allocation' means an entry in the National
Table of Frequency Allocations of a given frequency band for
the purpose of its use by one or more radiocommunication
services.
``(2) The term `assignment' means an authorization given to
a station licensee to use specific frequencies or channels.
``(3) The term `commercial carrier' means any entity that
uses a facility licensed by the Federal Communications
Commission pursuant to the Communications Act of 1934 for hire
or for its own use, but does not include Federal Government
stations licensed pursuant to section 305 of the Act (47 U.S.C.
305).
``(4) The term `the Act' means the Communications Act of
1934 (47 U.S.C. 151 et seq.).''.
CHAPTER 3--COMMUNICATIONS TECHNICAL AMENDMENTS
SEC. 5241. CLERICAL CORRECTIONS.
(a) Amendments to the Communications Act of 1934.--The
Communications Act of 1934 is amended--
(1) in section 4(f)(3), by striking ``overtime exceeds
beyond'' and inserting ``overtime extends beyond'';
(2) in section 5, by redesignating subsection (f) as
subsection (e);
(3) in section 220(b), by striking ``clasess'' and
inserting ``classes'';
(4) in section 223(b)(3), by striking ``defendant restrict
access'' and inserting ``defendant restricted access'';
(5) in section 226(d), by striking paragraph (2) and
redesignating paragraphs (3) and (4) as paragraphs (2) and (3),
respectively;
(6) in section 227(e)(2), by striking ``national datebase''
and inserting ``national database'';
(7) in section 228(c)(6)(D), by striking ``conservation''
and inserting ``conversation'';
(8) in section 308(c), by striking ``May 24, 1921'' and
inserting ``May 27, 1921'';
(9) in section 331, by amending the heading of such section
to read as follows:
``very high frequency stations and am radio stations'';
(10) in section 358, by striking ``(a)'';
(11) in part III of title III--
(A) by inserting before section 381 the following
heading:
``vessels transporting more than six passengers for hire required to be
equipped with radio telephone'';
(B) by inserting before section 382 the following
heading:
``vessels excepted from radio telephone requirement'';
(C) by inserting before section 383 the following
heading:
``exemptions by commission'';
(D) by inserting before section 384 the following
heading:
``authority of commission; operations, installations, and additional
equipment'';
(E) by inserting before section 385 the following
heading:
``inspections''; and
(F) by inserting before section 386 the following
heading:
``forfeitures'';
(12) in section 410(c), by striking ``, as referred to in
sections 202(b) and 205(f) of the Interstate Commerce Act,'';
(13) in section 705(e)(3)(A), by striking ``paragraph (4)
of subsection (d)'' and inserting ``paragraph (4) of this
subsection'';
(14) in section 705, by redesignating subsections (f) and
(g) (as added by Public Law 100-667) as subsections (g) and
(h); and
(15) in section 705(h) (as so redesignated), by striking
``subsection (f)'' and inserting ``subsection (g)''.
(b) Amendments to the Communications Satellite Act of 1962.--The
Communications Satellite Act of 1962 is amended--
(1) in section 303(a)--
(A) by striking ``section 27(d)'' and inserting
``section 327(d)'';
(B) by striking ``sec. 29-911(d)'' and inserting
``sec. 29-327(d)'';
(C) by striking ``section 36'' and inserting
``section 336''; and
(D) by striking ``sec. 29-916d'' and inserting
``sec. 29-336(d)'';
(2) in section 304(d), by striking ``paragraphs (1), (2),
(3), (4), and (5) of section 310(a)'' and inserting
``subsection (a) and paragraphs (1) through (4) of subsection
(b) of section 310''; and
(3) in section 304(e)--
(A) by striking ``section 45(b)'' and inserting
``section 345(b)''; and
(B) by striking ``sec. 29-920(b)'' and inserting
``sec. 29-345(b)''; and
(4) in sections 502(b) and 503(a)(1), by striking
``Communications Satellite Corporation'' and inserting
``communications satellite corporation established pursuant to
title III of this Act''.
(c) Conforming Amendment.--Section 1253 of the Omnibus Budget
Reconciliation Act of 1981 is repealed.
SEC. 5242. TRANSFER OF PROVISIONS OF LAW CONCERNING PUBLIC
TELECOMMUNICATIONS FACILITIES, CHILDREN'S EDUCATIONAL
TELEVISION, AND TELECOMMUNICATIONS DEMONSTRATION PROGRAM.
(a) Amendments.--The Communications Act of 1934 (hereinafter in
this section referred to as ``the 1934 Act'') and the National
Telecommunications and Information Administration Organization Act
(hereinafter in this section referred to as ``the NTIAO Act'') are
amended as follows:
(1) The NTIAO Act is amended by inserting after part B (as
added by chapter 2 of this subtitle) a new part C, the heading
of which shall be as follows:
``PART C--ASSISTANCE FOR PUBLIC TELECOMMUNICATIONS FACILITIES;
CHILDREN'S EDUCATIONAL TELEVISION; TELECOMMUNICATIONS DEMONSTRATIONS'';
(2) Sections 390, 391, 392, 393, 393A, 394, and 395 of the
1934 Act are transferred to such new part C of the NTIAO Act
and are redesignated as sections 121, 122, 123, 124, 125, 131,
and 135, respectively, of the NTIAO Act.
(3) Such new part C of the NTIAO Act is amended--
(A) by inserting before section 121 the following:
``Subpart 1--Assistance for Public Telecommunications Facilities'' and;
(B) by inserting before section 131 the following:
``Subpart 2--National Endowment for Children's Television'' and;
(C) by inserting before section 135 the following:
``Subpart 3--Telecommunications Demonstrations''.
(4) Section 125 of the NTIAO Act (as added by paragraph (2)
of this subsection) is amended by striking ``section 390'' and
inserting ``section 121''.
(5) Each of such sections 121 through 135 is amended so
that the section designation and section heading of each such
shall be in the form and typeface of the section designation
and section heading of this section.
(b) Conforming Amendment to Communications Act of 1934.--Part IV of
title III of the 1934 Act is amended by striking out subparts A, B, and
C.
(c) References in Other Laws and Documents.--Any reference to any
section or other provision of subpart A, B, or C of part IV of title
III of the 1934 Act in any law, rule, regulation, certificate,
directive, instruction, or other official paper in force on the date of
enactment of this section shall be deemed to refer to the section or
other provision of subpart 1, 2, or 3 of part C of the NTIAO Act to
which such section or other provision is transferred by this section.
SEC. 5243. ELIMINATION OF EXPIRED AND OUTDATED PROVISIONS.
(a) Amendments to the Communications Act of 1934.--The
Communications Act of 1934 is amended--
(1) in section 7(b), by striking ``or twelve months after
the date of the enactment of this section, if later'' both
places it appears;
(2) in section 212, by striking ``After sixty days from the
enactment of this Act it shall'' and inserting ``It shall'';
(3) in section 213, by striking subsection (g) and
redesignating subsection (h) as subsection (g);
(4) in section 214(a), by striking ``section 221 or 222''
and inserting ``section 221'';
(5) in section 220(b), by striking ``, as soon as
practicable,'';
(6) in section 222--
(A) by striking paragraph (1) of subsection (a);
(B) by redesignating paragraphs (2) and (3) of such
subsection as paragraphs (1) and (2), respectively;
(C) by striking paragraph (2) of subsection (b);
(D) by redesignating subsection (b)(1) as
subsection (b); and
(E) by striking subsections (c), (d), and (e);
(7) in section 224(b)(2), by striking ``Within 180 days
from the date of enactment of this section the Commission'' and
inserting ``The Commission'';
(8) in 226(e)(1), by striking ``, within 9 months after the
date of enactment of this section,'';
(9) in section 309(i)(4)(A), by striking ``The commission,
not later than 180 days after the date of the enactment of the
Communications Technical Amendments Act of 1982, shall,'' and
inserting ``The Commission shall,'';
(10) by striking section 328;
(11) in section 331(b), by striking the last sentence;
(12) in section 413, by striking ``, within sixty days
after the taking effect of this Act,'';
(13) in section 624(d)(2)--
(A) by striking out ``(A)'';
(B) by inserting ``of'' after ``restrict the
viewing''; and
(C) by striking subparagraph (B);
(14) by striking sections 702 and 703;
(15) in section 704--
(A) by striking subsections (b) and (d); and
(B) by redesignating subsection (c) as subsection
(b);
(16) in section 705(g) (as redesignated by section
5211(15)), by striking ``Within 6 months after the date of
enactment of the Satellite Home Viewer Act of 1988, the Federal
Communications Commission'' and inserting ``The Commission'';
(16) in section 710(f)--
(A) by striking the first and second sentences; and
(B) in the third sentence, by striking
``Thereafter, the Commission'' and inserting ``The
Commission'';
(17) in section 712(a), by striking ``, within 120 days
after the effective date of the Satellite Home Viewer Act of
1988,''; and
(18) by striking section 713.
(b) Amendments to the Communications Satellite Act of 1962.--The
Communications Satellite Act of 1962 is amended--
(1) in section 201(a)(1), by striking ``as expeditiously as
possible,'';
(2) by striking sections 301 and 302 and inserting the
following:
``SEC. 301. CREATION OF CORPORATION.
``There is authorized to be created a communications satellite
corporation for profit which will not be an agency or establishment of
the United States Government.
``SEC. 302. APPLICABLE LAWS.
``The corporation shall be subject to the provisions of this Act
and, to the extent consistent with this Act, to the District of
Columbia Business Corporation Act. The right to repeal, alter, or amend
this Act at any time is expressly reserved.'';
(3) in section 304(a), by striking ``at a price not in
excess of $100 for each share and'';
(4) in section 404--
(A) by striking subsections (a) and (c); and
(B) by striking ``(b)'' at the beginning of
subsection (b);
(5) in section 503--
(A) by striking paragraph (2) of subsection (a);
and
(B) by redesignating paragraph (3) of subsection
(a) as paragraph (2) of such subsection;
(C) by striking subsection (b);
(D) in subsection (g)--
(i) by striking ``subsection (c)(3)'' and
inserting ``subsection (b)(3)''; and
(ii) by striking the last sentence; and
(E) by redesignating subsections (c) through (h) as
subsections (b) through (g), respectively;
(5) by striking sections 505, 506, and 507; and
(6) by redesignating section 508 as section 505.
SEC. 5244. STYLISTIC CONSISTENCY.
The Communications Act of 1934 and the Communications Satellite Act
of 1962 are amended so that the section designation and section heading
of each section of such Acts shall be in the form and typeface of the
section designation and heading of this section.
Subtitle D--Energy Programs
SEC. 5301. NUCLEAR REGULATORY COMMISSION ANNUAL CHARGES.
Section 6101(a)(3) of the Omnibus Budget Reconciliation Act of 1990
(42 U.S.C. 2214(a)(3)) is amended by striking ``September 30, 1995''
and inserting ``September 30, 1998''.
TITLE VI--COMMITTEE ON FOREIGN AFFAIRS
In order to implement its reconciliation instructions, the
Committee on Foreign Affairs recommends changes in law that are also
recommended by the Committee on Post Office and Civil Service. These
changes in law, which are contained in title X of this Act, would
reduce direct spending under the Foreign Service Retirement and
Disability Fund and the Foreign Service Pension System by requiring a
3-month delay in cost-of-living adjustments in each of the fiscal years
1994, 1995, and 1996.
TITLE VII--COMMITTEE ON THE JUDICIARY
SEC. 7001. PATENT AND TRADEMARK FEES.
Section 10101 of the Omnibus Budget Reconciliation Act of 1990 (35
U.S.C. 41 note) is amended--
(1) in subsection (a) by striking ``1995'' and inserting
``1998'';
(2) in subsection (b)(2) by striking ``1995'' and inserting
``1998''; and
(3) in subsection (c)--
(A) by striking ``through 1995'' and inserting
``through 1998''; and
(B) by adding at the end the following:
``(6) $111,000,000 in fiscal year 1996.
``(7) $115,000,000 in fiscal year 1997.
``(8) $119,000,000 in fiscal year 1998.''.
TITLE VIII--COMMITTEE ON MERCHANT MARINE AND FISHERIES
SEC. 8001. EXTENSION OF VESSEL TONNAGE DUTIES.
(a) Extension of Duties.--Section 36 of the Act of August 5, 1909
(36 Stat. 111; 46 App. U.S.C. 121), is amended by--
(1) striking ``and 1995,'' each place it appears and
inserting ``1995, 1996, 1997, 1998,'';
(2) striking ``place,'' and inserting ``place;''; and
(3) striking ``port, not, however, to include vessels in
distress or not engaged in trade'' and inserting ``port.
However, neither duty shall be imposed on vessels in distress
or not engaged in trade''.
(b) Conforming Amendment.--The Act of March 8, 1910 (36 Stat. 234;
46 App. U.S.C. 132), is amended by striking ``and 1995,'' and inserting
``1995, 1996, 1997, and 1998,''.
(c) Technical Correction.--
(1) Correction.--Section 10402(a) of the Omnibus Budget
Reconciliation Act of 1990 (104 Stat. 1388-398) is amended by
striking ``in the second paragraph''.
(2) Effective date.--The amendment made by paragraph (1)
shall be effective on and after November 5, 1990.
SEC. 8002. SENSE OF THE CONGRESS ON THE INLAND WATERWAYS FUEL TAX.
(a) Findings.--The Congress finds the following:
(1) The Administration has proposed to increase the tax on
inland barge fuels from $0.19 to $1.19 per gallon by 1997,
which represents an increase of 525 percent.
(2) The General Accounting Office has recently identified
117 forms of Federal fees, taxes, and assessments, not
including customs duties, which raise some $2,000,000,000 in
Federal revenues each year.
(3) Barge transportation is one of the most competitive,
efficient, safe, and environmentally friendly modes of
transportation.
(4) Barges transport 15 percent of our Nation's commerce
and provide jobs to some 180,000 Americans.
(5) The Administration's proposed increase would add
$420,000,000 in new taxes for operators on inland waterways,
which is more than their pretax profits.
(6) This increase would cause barge rates to skyrocket,
increasing costs to consumers and devastating industries
dependent upon the commercial use of barges such as coal,
agriculture, and petrochemicals, and would add to our
unfavorable balance of trade payments by hurting the
competitiveness of United States exports.
(7) Because the price of certain agricultural commodities,
such as grain, are set in the world marketplace, increased
inland barge fuel taxes could not be passed on to consumers and
would largely be borne by our Nation's farmers.
(8) The Senate on March 18, 1993, voted 88 to 12 to reject
any further increase in inland barge fuel taxes.
(9) This huge tax increase would cause many barge companies
to go out of business, would result in thousands of lost
American jobs, and would further burden the already beleaguered
United States maritime industry.
(b) Sense of Congress.--It is the sense of the Congress that the
inland waterways fuel tax should not be further increased beyond those
increases already mandated by law.
TITLE IX--COMMITTEE ON NATURAL RESOURCES
SEC. 9001. ANNUAL DIRECT GRANT ASSISTANCE.
(a) Repeal.--Sections 3 and 4 of the Act of March 24, 1976 entitled
``a Joint Resolution to approve the `Covenant To Establish a
Commonwealth of the Northern Mariana Islands in Political Union with
the United States of America', and for other purposes'' (90 Stat. 263
and following; 48 U.S.C. 1681 note) are repealed, effective on October
1, 1993.
(b) Definitions.--As used in this section:
(1) Committees.--The term ``committees'' means the
Committee on Natural Resources of the House of Representatives
and the Committee on Energy and Natural Resources of the
Senate.
(2) Recommendations.--The term ``Recommendations'' means
the document executed December 17, 1992, between the special
representative of the President of the United States and the
special representatives of the Governor of the Commonwealth of
the Northern Mariana Islands relating to future federal
assistance for the Northern Mariana Islands.
(3) Reporting date.--The term ``reporting date'' means the
date on which the budget of the President for the fiscal year
1995 is required to be submitted to the Congress under section
1105 of title 31, United States Code.
(c) Assistance.--
(1) Amounts.--Except as otherwise provided under
this section, enactment of this section shall
constitute a commitment and pledge of the full faith
and credit of the United States for the payment of the
following amounts:
(A) In fulfillment of the United States
obligation under P.L. 94-241 and the
authorization in P.L. 95-348, $3,000,000 for
fiscal year 1994, which shall be available only
for the American Memorial Park, located at
Tanapag Harbor Reservation, Saipan, to be
expended in accordance with section 5 of the
Act entitled ``An Act to authorize
appropriations for certain insular areas of the
United States, and for other purposes'',
approved August 18, 1978 (92 Stat. 492), for
the primary purpose of constructing an
appropriate monument honoring the dead in the
World War II Mariana Islands campaign.
(B) $19,000,000 for fiscal year 1994, to be
held in trust in a special account by the
Secretary of the Interior for American Samoa,
the Commonwealth of the Northern Mariana
Islands, Guam, the Trust Territory of the
Pacific Islands, and the Virgin Islands, and to
be disbursed by the Secretary during fiscal
year 1994 for essential capital improvement
projects. Such disbursements shall be made by
the Secretary for projects described in plans
submitted to the Secretary by the governments
of American Samoa, the Commonwealth of the
Northern Mariana Islands, Guam, the Trust
Territory of the Pacific Islands, and the
Virgin Islands. No such disbursements shall be
made pursuant to any such plan until after the
expiration of a period of 60 days after such
plan has been submitted to the committees. No
such disbursements shall be made to the
Commonwealth of the Northern Mariana Islands
during fiscal year 1994 pursuant to any such
plan until the committees have received the
reports required under subsection (d)(3) and a
Joint Resolution has been adopted expressing
the sense of Congress that disbursements are
appropriate. The Inspector General of the
Department of the Interior shall (i) monitor
the expenditure of such funds to determine
whether such funds are expended in accordance
with applicable law, and (ii) submit a report
of the findings to the committees not later
than January 1, 1995.
(C) Subject to paragraphs (2), (3), and (4)
and subject to subsection (d), not more than
$98,000,000 for the 6-year period beginning
October 1, 1994, for the government of the
Commonwealth of the Northern Mariana Islands,
for capital improvement projects, at annual
amounts that shall not exceed those specified
for the Federal contribution within the general
funding schedule contained in the
Recommendations.
(2) Matching ratio and interest earnings.--Nothing
in this section shall be construed to--
(A) modify the matching ratio requirement
specified in the funding schedule contained in
the Recommendations; or
(B) modify the terms of the Recommendations
as to the availability of interest earnings on
funds contributed under Public Law 99-396 upon
meeting the terms of the grant pledge
agreements entered into under Public Law 99-
396.
(3) Rota, tinian, and saipan.--No less than \1/8\th
share of the funds made available under subsection
(c)(1)(C) shall be expended in the islands of Rota and
Tinian and no less than \1/4\th share shall be expended
in Saipan.
(4) Applicability of grant regulations.--The
Federal assistance provided under this section shall be
subject to the applicable Federal grant regulations set
forth in the Common Rule (43 C.F.R. 12a, OMB Circular
A-102, and OMB Circular A-128).
(d) Condition on Multi-Year Assistance.--
(1) Joint resolution.--Amounts under subsection (c)(1)(C)
for fiscal years 1995 through 2000 shall be as determined by
the Congress by joint resolution. It is the intent of the
Congress that the committees report such a joint resolution
after considering the plan referred to in paragraph (2) and
reports required by this subsection.
(2) Capital improvement projects plan.--The plan referred
to in paragraph (1) is a plan developed and submitted by the
Governor of the Commonwealth of the Northern Mariana Islands to
the Secretary of the Interior as approved by the legislature of
the Commonwealth for new and reconstructed capital
infrastructure projects, indicating the order of priority,
together with cost estimates for each project and
identification of sources of financing for each project. The
Secretary of the Interior shall submit the plan, together with
his recommendations, to the committees not later than the
reporting date.
(3) Reports.--Each of the following reports shall be
submitted to the committees not later than the reporting date
as follows:
(A) Revenue burden.--The Comptroller General of the
United States, after consultation with the government
of the Northern Mariana Islands, shall submit a report
describing the effective revenue burden (including all
taxes and fees) imposed by the government of the
Commonwealth of the Northern Mariana Islands. The
report shall--
(i) address whether revenues raised are
sufficient to meet the infrastructure needs of
the Commonwealth; and
(ii) compare the revenue burden of the
Commonwealth with that of Guam.
(B) Compliance with audit recommendations.--The
Inspector General of the Department of the Interior
shall submit a report on (i) compliance by the
government of the Commonwealth of the Northern Mariana
Islands with recommendations made by the Inspector
General pursuant to audits of the government of the
Commonwealth, and (ii) on all unfulfilled commitments
made by the government of the Commonwealth in response
to those recommendations.
(C) Assessment of minimum wage.--The Secretary of
Labor, after consultation with the government of the
Commonwealth of the Northern Mariana Islands, shall
submit a report which assesses whether--
(i) the minimum wage policies of the
Commonwealth are sufficient for the maintenance
of the minimum standard of living necessary for
health, efficiency, and general well-being of
workers in the Commonwealth;
(ii) the prevailing wages paid in the
Commonwealth are effectively reduced by the
immigration policy of the Commonwealth; and
(iii) the wage rate in the Commonwealth
gives industries in the Commonwealth a
competitive advantage over industries in the
United States outside of the Commonwealth.
(D) Immigration policy and burden on
infrastructure.--(i) The Attorney General of the United
States, after consultation with the government of the
Commonwealth of the Northern Mariana Islands, shall
submit a report which assesses--
(I) whether the immigration laws of the
Commonwealth are appropriate in light of the
social and economic situation in the
Commonwealth;
(II) the extent to which the Commonwealth
is relying on temporary alien workers to meet
the Commonwealth's permanent labor needs;
(III) whether the Commonwealth has taken
steps to reduce its dependence on temporary
alien workers; and
(IV) the political and civil rights of the
alien population as compared to the resident
population.
(ii) The Comptroller General of the United States
shall submit a report to the Congress which analyzes
the socioeconomic impact of the immigration policy of
the Commonwealth of the Northern Mariana Islands,
including the financial burden imposed by the alien
population on the infrastructure.
(E) Environmental laws.--The Secretary of the
Interior and the Administrator of the Environmental
Protection Agency shall each submit a report to the
Congress on the compliance by the Commonwealth of the
Northern Mariana Islands with United States
environmental laws, including (but not limited to) the
National Environmental Policy Act of 1969, the
Endangered Species Act of 1973, and the Federal Water
Pollution Control Act.
SEC. 9002. NET RECEIPTS SHARING.
Section 35 of the Mineral Leasing Act is amended as follows:
(1) Strike the last sentence.
(2) Insert ``(a) In General.--'' after ``Sec. 35.''
(3) Insert ``and, subject to subsection (b),'' between
``United States;'' and ``50 percentum''.
(4) Add the following new subsection at the end thereof:
``(b) Administrative Costs.--(1) In calculating the amount to be
paid to each State during any fiscal year under this section and under
other provisions of law requiring payment to a State of any revenues
derived from the leasing of any other onshore lands or interest in land
owned by the United States for the production of the same types of
minerals as are leasable under this Act or for the production of
geothermal steam, prior to the division and distribution of such
leasing receipts between the States and the United States, the
Secretary shall deduct 50 percent of the portion of the enacted
appropriations of the Department of the Interior and of other
departments and agencies of the United States for the preceding fiscal
year allocable to the administration and enforcement of this Act and
such other provisions of law. Such deduction shall be in approximately
equal amounts each month (subject to paragraph (3)).
``(2) The proportion of the deduction required under paragraph (1)
which is allocable to each State shall be a percentage of the total
deduction allocable to all States. The percentage shall be determined
by dividing--
``(A) the monies disbursed to the State during the
preceding fiscal year under the provisions of this section and
the other provisions of law referred to in paragraph (1), by
``(B) the total money disbursed to all States during that
fiscal year under such provisions.
``(3) If the amount otherwise deductible under this subsection in
any month from the portion of revenues to be distributed to a State
exceeds the amount payable to the State during that month, any amount
exceeding the amount payable shall be carried forward and deducted from
amounts payable to the State in subsequent months.
``(4) All amounts deducted under this subsection from monies
otherwise payable to a State shall be credited to miscellaneous
receipts in the Treasury.''.
SEC. 9003. HARD ROCK MINING CLAIM MAINTENANCE AND LOCATION FEES.
(a) Claim Maintenance and Location Fees.--
(1) Claim Maintenance Fees.--The holder of each unpatented
mining claim, mill or tunnel site located pursuant to the
Mining Laws of the United States (whether located before or
after enactment of this Act) shall pay to the Secretary of the
Interior or his designee for each assessment year a flat claim
maintenance fee of not less than $100 per claim. Such claim
maintenance fee shall be in lieu of the assessment work
requirement contained in the Mining Law of 1872 (30 U.S.C. 28-
28e) and the related filing requirements contained in section
314 (a) and (c) of the Federal Land Policy and Management Act
of 1976 (43 U.S.C. 1744 (a) and (c)).
(2) Location Fee.--For each mining claim, mill or tunnel
site located pursuant to the Mining Laws of the United States
after the date of enactment of this Act, the claimant shall pay
the Secretary a location fee of $25.
(b) Time of Payment.--The claim maintenance fee payable under
subsection (a)(1) for any assessment year shall be paid before the
commencement of the assessment year, except that for the initial
assessment year in which the location is made, the locator shall pay
the claim maintenance fee at the time the location notice is recorded
with the Bureau of Land Management. The location fee imposed under
subsection (a)(2) shall be payable not later than 90 days after the
date of location
(c) Deposit in Treasury.--The Secretary shall deposit monies
received under this Act as miscellaneous receipts in the Treasury.
(d) Co-ownership.--The co-ownership provisions of section 2324 of
the Mining Law of 1872 (30 U.S.C. 28) shall remain in effect with
respect to mining claims subject to such provisions except that the
annual claim maintenance fee, where applicable, shall be paid in lieu
of applicable assessment requirements and expenditures.
(e) Forfeiture.--Failure to make the annual payment of any claim
maintenance or location fee required with respect to any unpatented
mining claim, mill, or tunnel site required by subsection (a) shall
conclusively constitute a forfeiture by the holder of the unpatented
mining claim, mill or tunnel site, effective at noon on the date the
payment is due.
(f) FLPMA Filing Requirements.--Nothing in this Act shall change or
modify the requirements of section 314(b) of the Federal Land Policy
and Management Act of 1976 (43 U.S.C. 1744(b)) or the requirements of
section 314(c) of the Federal Land Policy and Management Act of 1976
(43 U.S.C. 1744(c)) related to filings required by such section 314(b).
Such requirements shall remain in effect with respect to claims, and
mill or tunnel sites for which fees are required to be paid under this
section.
(g) Rules and Regulations.--The Secretary of the Interior shall
promulgate rules and regulations to carry out the purposes of this
section as soon as practicable after the date of enactment of this Act.
(h) Purchasing Power Adjustment.--Every 5 years following the date
of enactment of this Act, or more frequently if the Secretary
determines a more frequent adjustment to be reasonable, the Secretary
of the Interior shall adjust the fees specified in subsection (a) to
reflect changes in the purchasing power of the dollar. The Secretary
shall use the Consumer Price Index for all urban consumers published by
the Department of Labor as the basis for adjustment, rounding according
to the adjustment process of conditions of the Federal Civil Penalties
Inflation Adjustment Act of 1990 (104 Stat. 890). The Secretary shall
provide claimants notice of any adjustment made under this subsection
not later than July 1 of any year in which the adjustment is made. A
fee adjustment under this paragraph shall begin to apply the first
assessment which begins after the adjustment is made.
(i) Oil Shale Claims Subject To Claim Maintenance Fees Under Energy
Policy Act of 1992.--This section shall not apply to any oil shale
claims for which a fee is required to be paid under section 2511(e)(2)
of the Energy Policy Act of 1992 (Public Law 102-486; 106 Stat. 3111;
30 U.S.C. 242).
(j) Exception for Holders of Fewer than 50 Claims.--
(1) Eligibility.--In accordance with paragraph (3), a
claimant may be eligible for a waiver or reduction of the claim
maintenance fees imposed under this section if the claimant
certifies in writing to the Secretary that on the date the
payment was due, the claimant and all related parties--
(A) held not more than 50 mining claims, mill
sites, or tunnel sites, or any combination thereof, on
public lands; and
(B) have performed assessment work sufficient to
maintain the mining claims held by the claimant and
such related parties for the assessment year ending on
noon of September 1 of the calendar year in which
payment of the claim maintenance fee was due; except
that such performance of assessment work shall not be
required by reason of section 5 of Public Law 94-429,
commonly known as the Mining in the Parks Act, or such
other laws that before the date of the enactment of
this Act removed the applicability of the assessment
work requirement of the general mining laws for any
claim subject to such laws.
(2) Holder.--For purposes of paragraph (1), with respect to
any claimant, the term ``related parties'' means--
(A) the spouse and dependent children (as defined
in section 152 of the Internal Revenue Code of 1986),
of the claimant; and
(B) a person affiliated with the claimant,
including--
(i) a person controlled by, controlling, or
under common control with the claimant; and
(ii) a subsidiary or parent company or
corporation of the claimant.
(3) Waived or reduced maintenance fees.--
(A) 10 or fewer claims.--The Secretary of the
Interior may waive the claim maintenance fee imposed
under this section in its entirety for 10 or fewer
claims held by a claimant eligible under paragraph (1).
(B) 11 or more claims.--
(i) In general.--Subject to clause (ii),
for a claimant eligible under paragraph (1),
the Secretary may reduce the claim maintenance
fee imposed under this section to $25 per claim
for each claim in excess of 10.
(ii) Limitation.--The reduction provided
for in this subparagraph shall be available for
no more than 50 claims held by a claimant who
is eligible under paragraph (1).
(4) Payment in lieu of annual labor requirements.--The
third sentence of section 2324 of the Revised Statutes (30
U.S.C. 28) is amended by inserting after ``On each claim
located after the tenth day of May, eighteen hundred and
seventy-two,'' the following: ``for which a waiver of the
maintenance fee, or a reduced maintenance fee, under section
9003 of the Omnibus Budget Reconciliation Act of 1993 has been
granted under subsection (j) of that section,''.
(5) Filing requirements.--The holder of any unpatented
mining claim for which a waiver of the maintenance fee, or a
reduced maintenance fee, has been granted pursuant to this
subsection shall continue to be subject to the filing
requirements contained in sections 314(a) and (c) of the
Federal Land Policy Management Act of 1976 (43 U.S.C. 1744(a)
and (c)).
(k) Effective Date.--This section shall take effect with respect to
assessment years beginning after August 31, 1994.
SEC. 9004. FEDERAL IRRIGATION WATER SURCHARGE.
(a) Findings and Purposes.--
(1) Findings.--The Congress finds that--
(A) the construction and operation of Federal
reclamation projects have contributed to the depletion
of streams, the alteration of riparian habitat, and the
degradation of water quality;
(B) such impacts have had adverse impacts on fish
and wildlife resources; and
(C) the restoration of fish and wildlife and
related habitat affected by the construction or
operation of Federal reclamation projects is a
continuing responsibility of the beneficiaries of such
projects.
(2) Purposes.--The purposes of this section are to--
(A) incorporate the restoration of fish and
wildlife resources and related habitat affected by the
construction or operation of Federal reclamation
projects into the annual operation and maintenance
requirements of such projects;
(B) establish a fair and equitable mechanism for
securing timely payments from the beneficiaries of such
projects for the implementation, operation, and
maintenance of fish and wildlife restoration measures;
(C) accelerate the rate of restoration and recovery
of depleted populations of indigenous fish and
wildlife; and
(D) encourage more efficient use of water resources
by the beneficiaries of Federal reclamation projects.
(b) Operational Charges.--
(1) In general.--Individuals or non-Federal entities that
receive delivery of water (including by exchange) which is
stored in or transported through Federal reclamation projects
or project facilities or projects or project facilities
constructed by the Secretary of the Army that meet the
conditions specified in paragraph (1) or (2) of section 212(a)
of the Reclamation Reform Act of 1982 (Public Law 97-293, 43
U.S.C. 390ll), except for facilities of the Central Valley
Project, California (as that project is defined by title XXXIV
of Public Law 102-575), shall, pursuant to such terms,
conditions, and procedures as the Secretary of the Interior may
prescribe, pay to the United States an operation and
maintenance charge sufficient to yield at least $10,000,000
(January 1993 price levels) annually in the years 1994, 1995,
and 1996 and at least $15,000,000 (January 1993 price levels)
annually in 1997 and each year thereafter.
(2) Payments.--Payments required by paragraph (1) shall be
made without reduction or deferral by the Secretary under any
provision of reclamation law and without regard to whether an
individual or entity has discharged its repayment obligation
within the meaning of the first section of the Act of July 2,
1956 (70 Stat. 483; 43 U.S.C. 485h-1), section 213 of the
Reclamation Reform Act of 1982 (Public Law 97-293, 43 U.S.C.
390mm), or any other provision of Federal Reclamation law. The
payments shall be in addition to any other repayments owed or
made to the United States and shall not be applied or credited
to an individual's or entity's repayment of project
construction costs, payment of other annual project operation
and maintenance costs, payment of interest, or reduction of any
contractual obligation the individual or entity may have with
the United States.
(c) Natural Resources Restoration Fund.--There is hereby
established in the Treasury of the United States a fund to be known as
the ``Natural Resources Restoration Fund'' (hereafter in this section
referred to as the ``Fund''). All payments of the operation and
maintenance charges authorized in subsection (b) shall be deposited in
the Fund, and shall be available in the fiscal year following deposit
and thereafter, to such extent or in such amounts as are provided in
advance in appropriation Acts, for expenditures by the Secretary of the
Interior for the benefit of fish and wildlife resources, including
habitat, affected by construction or operation of the projects referred
to in this section.
(d) Indian Land Owners.--For the purposes of this section, Indian
tribes or individual Indian beneficial owners of land held in trust by
the United States or subject to a restriction against alienation by the
United States shall be considered to be Federal entities.
(e) Federal Reclamation Law.--This section shall constitute an
amendment of and a supplement to the Federal Reclamation laws (the
Reclamation Act of 1902, 32 Stat. 388, and Acts amendatory thereof and
supplementary thereto).
SEC. 9005. RECREATION USER FEES.
(a) Land and Water Conservation Fund Act of 1965.--
(1) In general.--The first sentence of section 4(b) of the
Land and Water Conservation Fund Act of 1965 (relating to
recreation use fees) is amended by striking out ``picnic
tables, or boat ramps'' and all that follows down through the
period at the end thereof and inserting the following: ``or
picnic tables, and in no event shall there be any charge for
the use of any campground not having a majority of the
following: tent or trailer spaces, drinking water, access road,
refuse containers, toilet facilities, fee collection by an
employee or agent of the Federal agency operating the facility,
reasonable visitor protection, and simple devices for
containing a campfire (where campfires are permitted). For
purposes of this subsection, the term `specialized outdoor
recreation site' includes but shall not be limited to
campgrounds, swimming sites, boat launch facilities, and
managed parking lots.''. The second sentence of such section
4(b) is hereby repealed.
(2) Conforming amendment.--Section 210 of Public Law 90-483
(82 Stat. 746; 16 U.S.C. 460d-3) is repealed.
(b) Costs of Collection.--Section 4(i) of the Land and Water
Conservation Fund Act of 1965 (relating to special accounts for fees
collected) is amended by inserting ``(A)'' after ``(1)'' and by adding
the following at the end of paragraph (1):
``(B) Notwithstanding subparagraph (A), in any fiscal year, the
Secretary of Agriculture and the Secretary of the Interior may withhold
from the special account established under subparagraph (A) such
portion of all receipts the fees collected in that fiscal year under
this section as such Secretary determines to be equal to the additional
fee collection costs for that fiscal year. The amounts so withheld
shall be retained by the Secretary of Agriculture or the Secretary of
the Interior and shall be available, without further appropriation, for
expenditure by the Secretary concerned in the fiscal year in which
collected to cover such additional fee collection costs. The Secretary
concerned shall deposit in the special account established pursuant to
subparagraph (A) any amounts so retained which remain unexpended and
unobligated at the end of such fiscal year. For the purposes of this
subparagraph, for any fiscal year, the term `additional fee collection
costs' means those costs for personnel and infrastructure directly
associated with the collection of fees imposed under this section which
exceed the costs for personnel and infrastructure directly associated
with the collection of such fees during fiscal year 1993.''.
(c) Golden Age Passport.--The second sentence of section 4(a)(4) of
the Land and Water Conservation Fund Act of 1965 (relating to Golden
Age Passports) is amended to read as follows: ``Such permit shall be
nontransferable, shall be issued for a charge of $10, and shall entitle
the permittee and the permittee's spouse accompanying the permittee to
general admission into any area designated pursuant to this section.''.
(d) User Fees for Rights-of-Way.--In each fiscal year after the
enactment of this Act, the Secretary of the Interior shall impose and
collect an annual fee for the use and occupancy of any right-of-way
through any national park system unit for which a permit has been
issued by the Secretary pursuant to any general or specific statutory
right-of-way authority (whether issued before or after the enactment of
this Act) or for any other right-of-way allowed as of the date of the
enactment of this Act. The amount of such annual fee shall be equal to
the fair market rental value, as determined by the Secretary, of such
use and occupancy for the fiscal year concerned. The fair market value
shall be reviewed (and revised if necessary) not less frequently than
every 3 years. The Secretary shall deposit all fees collected under
this subsection in the special account established under section 4(i)
of the Land and Water Conservation Fund Act of 1965.
(e) Commercial Tour Use Fees.--(1) In the case of each unit of the
National Park System for which an admission fee is charged under
section 4 of the Land and Water Conservation Fund Act of 1965 (16
U.S.C. 460l-4), the Secretary of the Interior shall establish, by
October 1, 1993, a commercial tour use fee to be imposed on each
vehicle or aircraft entering the unit (or the airspace of the unit) for
the purpose of providing commercial tour services within (or within the
air space of) the unit. Fee revenue derived from such commercial tour
use fees shall be deposited into the special account established under
section 4(i) of the Land and Water Conservation Fund Act of 1965.
(2) The Secretary shall establish the amount of fee to be imposed
under this subsection per entry. The fee shall not be less than--
(A) $25 per vehicle or aircraft with a passenger capacity
of 25 persons or less,
(B) $50 per vehicle or aircraft with a passenger capacity
of 26 to 99 persons, and
(C) $100 per vehicle or aircraft with a passenger capacity
of 100 to 299 persons.
The Secretary may periodically increase the fee imposed under this
subsection as he deems necessary and justifiable.
(3) The commercial tour use fee imposed under this subsection shall
not apply to either of the following:
(A) Any vehicle or aircraft transporting organized school
groups or outings conducted for educational purposes by schools
or other bona fide educational institutions.
(B) Any vehicle or aircraft entering a park system unit
pursuant to a contract issued under the Act of October 9, 1965
(16 U.S.C. 20-20g) entitled ``An Act relating to the
establishment of concession policies in the areas administered
by the National Park Service and for other purposes''.
(f) Fair Market Value for Communication Site Fees.--No permit or
other authorization for the use of any area of the public lands of the
United States for purposes of commercial telephone transmission
facilities shall remain in force and effect after January 1, 1994
unless, before that date, and before January 1 of each year thereafter,
the holder of such permit or other authorization pays to Secretary of
the Department having administrative jurisdiction over such lands an
amount equal to the fair market value, as determined by such Secretary,
of the right to use and occupy such area for such purposes. For
purposes of this subsection, the term ``public lands of the United
States'' means lands owned by the United States and administered by the
Secretary of the Interior (other than lands held for the benefit of
Indians, Aleuts, and Eskimos) and lands within the National Forest
System.
SEC. 9006. NUCLEAR REGULATORY COMMISSION ANNUAL CHARGES.
Section 6101(a)(3) of the Omnibus Budget Reconciliation Act of 1990
(42 U.S.C. 2214(a)(3)) is amended by striking ``September 30, 1995''
and inserting ``September 30, 1998''.
SEC. 9007. RECOVERING THE COST FOR GOVERNMENT SERVICES.
(a) Report.--Not later than January 1, 1994, the Secretary of the
Interior and the Secretary of Energy shall each submit a report
identifying fees, penalties, and other charges to the Committee on
Natural Resources of the House of Representatives and the Committee on
Energy and Natural Resources of the Senate. Each report shall--
(1) identify all fees, penalties, and other charges imposed
by the respective Secretary for the provision of services;
(2) include the procedures for adjusting such fees to
recover the cost of providing those services; and
(3) identify those services for which no fee is currently
charged and make recommendations for a fee appropriate to cover
the cost of providing each service.
(b) Adjustment of Fees.--Except as provided in subsection (d), for
fiscal year 1995 and each fiscal year thereafter, the Secretary of the
Interior and the Secretary of Energy shall adjust each fee, penalty,
and other charge for the provision of services identified pursuant to
subsection (a)(1). Each such fee, penalty, and charge shall be adjusted
in accordance with the procedures identified pursuant to subsection
(a)(2).
(c) Implementation of Fees for Services Not Covered.--Beginning
with fiscal year 1995, the Secretary of the Interior and the Secretary
of Energy shall charge fees for each of the services identified
pursuant to subsection (a)(3) in an amount sufficient to recover the
cost of providing the service. For each fiscal year thereafter, the fee
shall be adjusted in the same manner as adjustments are made pursuant
to subsection (b), using fiscal year 1995 as the base year.
(d) Certain Fees, Penalties and Charges Not Covered.--Subsection
(b) shall not apply to any fee, penalty, or charge the amount of which
is expressly specified in any statute or contract.
SEC. 9008. UNFUNDED LIABILITIES OF THE FEDERAL GOVERNMENT.
Section 1105 of title 31, United States Code, is amended by adding
the following subsection at the end thereof:
``(g) The President shall transmit with materials related to each
budget an estimate of unfunded future liabilities of the Federal
Government that are not accounted for in the budget itself. Such
estimate shall include (but not be limited to) liabilities for future
remediation of environmental and natural resources damage, and cleaning
up waste sites, on Federal lands. Sources of liabilities shall include
(but not be limited to) active, inactive, or abandoned mines or oil or
gas wells, irrigation waste water impacts, decommissioning of nuclear
power plants, and uranium mining and processing activities (without
regard to the location of such mining or processing activities)
affecting the health of Native Americans and carried out pursuant to a
program administered by the United States.''.
TITLE X--COMMITTEE ON POST OFFICE AND CIVIL SERVICE
Subtitle A--Civil Service
SEC. 10001. DELAY IN COST-OF-LIVING ADJUSTMENTS IN FEDERAL EMPLOYEE
RETIREMENT BENEFITS DURING FISCAL YEARS 1994, 1995, AND
1996.
(a) Applicability.--This section shall apply with respect to any
cost-of-living increase scheduled to take effect, during fiscal year
1994, 1995, or 1996, under--
(1) section 8340(b) or 8462(b) of title 5, United States
Code;
(2) section 826 or 858 of the Foreign Service Act of 1980;
or
(3) section 291 of the Central Intelligence Agency
Retirement Act (50 U.S.C. 2131), as set forth in section 802 of
the CIARDS Technical Corrections Act of 1992 (Public Law 102-
496; 106 Stat. 3196).
(b) Delay in Effective Date of Adjustments.--A cost-of-living
increase described in subsection (a) shall not take effect until the
first day of the third calendar month after the date such increase
would otherwise take effect.
(c) Rule of Construction.--Nothing in this section shall be
considered to affect any determination relating to eligibility for an
annuity increase or the amount of the first increase in an annuity
under section 8340(b) or (c) or section 8462(b) or (c) of title 5,
United States Code, or comparable provisions of law.
SEC. 10002. PERMANENT ELIMINATION OF THE ALTERNATIVE-FORM-OF-ANNUITY
OPTION EXCEPT FOR INDIVIDUALS WITH A CRITICAL MEDICAL
CONDITION.
(a) Civil Service Retirement System; Federal Employees' Retirement
System.--Sections 8343a and 8420a of title 5, United States Code, are
each amended--
(1) in subsection (a) by striking ``an employee or Member
may,'' and inserting ``any employee or Member who has a life-
threatening affliction or other critical medical condition
may,''; and
(2) by striking subsection (f).
(b) Foreign Service Retirement and Disability System.--Section
807(e)(1) of the Foreign Service Act of 1980 (22 U.S.C. 4047(e)(1)) is
amended by striking ``a participant may,'' and inserting ``any
participant who has a life-threatening affliction or other critical
medical condition may,''.
(c) Central Intelligence Agency Retirement and Disability System.--
Section 294(a) of the Central Intelligence Agency Retirement Act (50
U.S.C. 2143(a)), as set forth in section 802 of the CIARDS Technical
Corrections Act of 1992 (Public Law 102-496; 106 Stat. 3196), is
amended by striking ``a participant may,'' and inserting ``any
participant who has a life-threatening affliction or other critical
medical condition may,''.
(d) Effective Date.--The amendments made by this section shall
become effective on January 1, 1994, and shall apply with respect to
any annuity commencing on or after that date.
SEC. 10003. PAY LIMITATIONS.
(a) Elimination of the 1994 Annual Pay Adjustment.--
(1) Statutory pay systems.--Notwithstanding section 633 of
the Treasury, Postal Service and General Government
Appropriations Act, 1991 (5 U.S.C. 5303 note) or any other
provision of law, the adjustment in rates of basic pay that is
scheduled to take effect in 1994 under section 5303 of title 5,
United States Code, shall not take effect.
(2) Other pay systems.--
(A) In general.--Notwithstanding any other
provision of law, any general pay adjustment, similar
to the adjustment referred to in paragraph (1), which
is scheduled to take effect in 1994 with respect to any
civilian officers or employees in the executive branch
(other than those affected by paragraph (1)) shall not
take effect.
(B) Exceptions.--Subparagraph (A) shall not apply
with respect to--
(i) any pay adjustment required under the
terms of a contract, as in effect before the
date of the enactment of this Act; or
(ii) any alien or noncitizen of the United
States who occupies a position outside the
United States.
(C) Regulations.--The Office of Personnel
Management may prescribe any regulations it considers
necessary for the administration of this paragraph.
(b) Modification in Formula for Computing Annual Pay Adjustments
for 1995, 1996, and 1997.--
(1) Statutory pay systems.--Section 5303(a) of title 5,
United States Code, is amended--
(A) by striking ``(a)'' and inserting ``(a)(1)'';
and
(B) by adding at the end the following:
``(2) Notwithstanding section 633 of the Treasury, Postal Service
and General Government Appropriations Act, 1991 or any other provision
of law, for purposes of any adjustment scheduled to take effect under
this section in 1995, 1996, or 1997, paragraph (1) shall be deemed to
be amended by striking `equal to' through `less than' and inserting
`equal to one and one-half percentage points less than'.''.
(2) Other pay systems.--Section 704(a)(1) of the Ethics
Reform Act of 1989 (5 U.S.C. 5318 note) is amended by adding at
the end the following:
``(C) Special rule.--For purposes of any pay
adjustment scheduled to take effect in 1995, 1996, or
1997, subparagraph (B) shall be deemed to be amended by
striking `one-half of 1 percent' and inserting `one and
one-half percent'.''.
SEC. 10004. PROVISIONS RELATING TO LOCALITY-BASED COMPARABILITY
PAYMENTS.
(a) Locality-Based Comparability Payments.--
(1) Change in effective date of payments.--Section
5304(d)(2) of title 5, United States Code, is amended by
striking ``January 1'' and inserting ``July 1''.
(2) Limitation relating to aggregate amount payable during
certain periods.--Section 5304 of title 5, United States Code,
is amended--
(A) by redesignating subsection (i) as subsection
(j); and
(B) by inserting after subsection (h) the
following:
``(i)(1) Notwithstanding any other provision of this section,
comparability payments may not be established or adjusted under this
section in a manner that would cause the resulting estimated total
amount payable under this section during the period which--
``(A) begins on July 1, 1994, and ends on June 30, 1995, to
exceed $1,800,000,000;
``(B) begins on July 1, 1995, and ends on June 30, 1996, to
exceed $2,500,000,000;
``(C) begins on July 1, 1996, and ends on June 30, 1997, to
exceed $3,300,000,000;
``(D) begins on July 1, 1997, and ends on June 30, 1998, to
exceed $4,200,000,000; or
``(E) begins on July 1, 1998, and ends on September 30,
1998, to exceed $1,747,000,000.
``(2) If necessary in order to achieve compliance with any of the
respective limitations under paragraph (1), the President may, in
carrying out subsection (d)(2), specify levels of comparability
payments less than the minimum which would otherwise be required under
subsection (a)(3).
``(3) The pay agent shall develop and include in the appropriate
reports under subsection (d)(1) the methodology for making any
estimates under this subsection, and any such estimate shall be made in
accordance with the methodology so included in the then most recent
report.
``(4) Whenever any authority under this subsection is exercised,
the President shall so indicate in his next report under subsection
(d)(3), including specific information as to how such authority was
exercised and the reasons why it was so exercised.''.
(b) Temporary Change in Effective Date of Annual Pay Adjustments
Under Section 5303 of Title 5, United States Code.--Section 5303(a) of
title 5, United States Code (as amended by section 10003(b)(1)), is
further amended by adding after paragraph (2) of such section 5303(a)
(as so amended) the following:
``(3) Effective for the period beginning on January 1, 1995, and
ending on December 31, 2003, paragraph (1) shall be deemed to be
amended by striking `January 1' and inserting `July 1'.''.
(c) Repeal of the Provision Excluding Senior Executives From the
Limitation Generally Applicable on the Accumulation of Annual Leave.--
(1) In general.--Section 6304(f) of title 5, United States
Code, is repealed, effective as of January 1, 1994.
(2) Savings provision.--
(A) Applicability.--This paragraph shall apply with
respect to an individual--
(i) who, as of December 31, 1993, has more
than 30 days of annual leave to such
individual's credit (or more than 45 days, if
the individual would be subject to section
6304(b) of such title) which were accrued in
any position described in section 6304(f) of
title 5, United States Code (as in effect on
the date of the enactment of this Act); and
(ii) only for so long as such individual
remains continuously employed in any such
position (disregarding any break in service of
3 days or less).
(B) Statement of the rule.--For purposes of
administering section 6304 of title 5, United States
Code, with respect to any individual to whom this
paragraph applies--
(i) subsection (a) of such section shall be
deemed amended by striking ``30'' and inserting
the number corresponding to the number of days
determined for such individual under
subparagraph (A)(i); and
(ii) subsection (b) of such section shall
be deemed amended by striking ``45'' and
inserting the number corresponding to the
number of days determined for such individual
under subparagraph (A)(i).
(3) Conforming amendment.--Section 6304(a) of title 5,
United States Code, is amended by striking ``(d), (e), (f), and
(g)'' and inserting ``(d) and (e)''.
(d) No Cash Awards Between Fiscal Years 1994 Through 1998.--
(1) Definition.--For the purpose of this subsection, the
term ``cash award'' means any cash award, performance award,
rank, or other form of recognition entitling the recipient to
any monetary payment under subchapter I of chapter 45 of title
5, United States Code, or section 5384, 5406, or 5407 of such
title.
(2) Restriction.--Notwithstanding any other provision of
law, no cash award may be awarded during the period beginning
on October 1, 1993, and ending on September 30, 1998.
(e) Reduction of Federal Workforce by 150,000.--
(1) Definition.--For the purpose of this subsection, the
term ``civilian employees in the executive branch'' means all
civilian employees within the executive branch of the
Government (other than in the United States Postal Service or
the Postal Rate Commission).
(2) Limitations.--The average total number of civilian
employees in the executive branch may not exceed--
(A) 2,095,200 in fiscal year 1994;
(B) 2,044,100 in fiscal year 1995;
(C) 2,010,100 in fiscal year 1996;
(D) 1,998,500 in fiscal year 1997; or
(E) 1,996,700 in fiscal year 1998.
(3) Averaging.--The average total number of civilian
employees in the executive branch in a fiscal year shall, for
purposes of this subsection, be the average number in such
fiscal year, as determined under regulations prescribed under
paragraph (5). Any such average shall be determined on a
``full-time equivalent'' basis.
(4) Voluntary measures.--To the extent practicable, any
reductions necessary to achieve compliance with any limitation
under paragraph (2) shall be effected through attrition or
other voluntary measures.
(5) Regulations.--The President shall prescribe regulations
to carry out this subsection.
(f) Pay-Limitation Provisions Made Applicable to Certain Employees
in the Judicial Branch.--The Director of the Administrative Office of
the United States Courts shall take such measures as may be necessary
to ensure that the purposes of subsections (a) and (b) of section 10003
and subsections (a)(1) (if applicable) and (b) of this section are
carried out with respect to employees who are subject to the personnel
management system established by the Director under section 3 of Public
Law 101-474 (28 U.S.C. 602 note).
SEC. 10005. APPLICATION OF MEDICARE PART B LIMITS TO PHYSICIANS'
SERVICES FURNISHED TO FEDERAL EMPLOYEE HEALTH BENEFITS
ENROLLEES AGE 65 OR OLDER.
(a) In General.--Section 8904(b) of title 5, United States Code, is
amended--
(1) in paragraph (1) by inserting ``(A)'' after ``(b)(1)''
and by adding at the end the following:
``(B)(i) A plan, other than a prepayment plan described in section
8903(4), may not provide benefits, in the case of any retired enrolled
individual who is age 65 or older and is not entitled to Medicare
supplementary medical insurance benefits under part B of title XVIII of
the Social Security Act (42 U.S.C. 1395j et seq.), to pay a charge
imposed for physicians' services (as defined in section 1848(j) of such
Act, 42 U.S.C. 1395w-4(j)) which are covered for purposes of benefit
payments under this chapter and under such part, to the extent that
such charge exceeds the fee schedule amount under section 1848(a) of
such Act (42 U.S.C. 1395w-4(a)).
``(ii) Physicians and suppliers who have in force participation
agreements with the Secretary of Health and Human Services consistent
with section 1842(h)(1) of such Act (42 U.S.C. 1395u(h)(1)), whereby
the participating provider accepts Medicare benefits (including
allowable deductible and coinsurance amounts) as full payment for
covered items and services shall accept equivalent benefit and enrollee
cost-sharing under this chapter as full payment for services described
in clause (i). Physicians and suppliers who are nonparticipating
physicians and suppliers for purposes of part B of title XVIII of such
Act shall not impose charges that exceed the limiting charge under
section 1848(g) of such Act (42 U.S.C. 1395w-4(g)) with respect to
services described in clause (i) provided to enrollees described in
such clause. The Office of Personnel Management shall notify a
physician or supplier who is found to have violated this clause and
inform them of the requirements of this clause and sanctions for such a
violation. The Office of Personnel Management shall notify the
Secretary of Health and Human Services if a physician or supplier is
found to knowingly and willfully violate this clause on a repeated
basis and the Secretary of Health and Human Services may invoke
appropriate sanctions in accordance with sections 1128A(a) and section
1848(g)(1) of such Act (42 U.S.C. 1320a-7a(a), 1395w-4(g)(1)) and
applicable regulations.
``(C) If the Secretary of Health and Human Services determines that
a violation of this subsection warrants excluding a provider from
participation for a specified period under title XVIII of the Social
Security Act, the Office shall enforce a corresponding exclusion of
such provider for purposes of this chapter.'';
(2) in paragraph (3)(B)--
(A) by inserting ``(i)'' after ``includes''; and
(B) by inserting before the period at the end the
following: ``, and (ii) the fee schedule amounts and
limiting charges for physicians' services established
under section 1848 of such Act (42 U.S.C. 1395w-4) and
the identity of participating physicians and suppliers
who have in force agreements with such Secretary under
section 1842(h) of such Act (42 U.S.C. 1395u(h))''; and
(3) by adding at the end the following:
``(4) The Director of the Office of Personnel Management shall
certify, before the first day of the fifth month that begins before
each contract year, that there is in effect an arrangement with the
Secretary of Health and Human Services under which, before the
beginning of the contract year--
``(A) physicians and suppliers (whether or not
participating) under the Medicare program will be notified of
the requirements of paragraph (1)(B);
``(B) enforcement procedures will be in place to carry out
such paragraph (including enforcement of protections against
overcharging of beneficiaries); and
``(C) Medicare program information described in paragraph
(3)(B)(ii) will be supplied to carriers under paragraph
(3)(A).''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply with respect to contract years beginning on or after January 1,
1995.
SEC. 10006. TEMPORARY EXTENSION OF METHOD FOR DETERMINING GOVERNMENT
CONTRIBUTIONS UNDER FEHBP IN THE ABSENCE OF A GOVERNMENT-
WIDE INDEMNITY BENEFIT PLAN.
(a) In General.--Public Law 101-76 (5 U.S.C. 8906 note) is amended
in subsection (a)(1) by striking ``1993'' and inserting ``1998''.
(b) Sense of Congress.--It is the sense of the Congress that
nothing in this section should be considered to reflect any view on the
appropriateness, merits, or timing, or any other aspect of any
comprehensive health care reform legislation.
Subtitle B--Postal Service
SEC. 10101. PAYMENTS TO BE MADE BY THE UNITED STATES POSTAL SERVICE.
(a) Relating to Corrected Calculations for Past Retirement COLAs.--
In addition to any other payments required under section 8348(m) of
title 5, United States Code, or any other provision of law, the United
States Postal Service shall pay into the Civil Service Retirement and
Disability Fund a total of $693,000,000, of which--
(1) at least one-third shall be paid not later than
September 30, 1995;
(2) at least two-thirds shall be paid not later than
September 30, 1996; and
(3) any remaining balance shall be paid not later than
September 30, 1997.
(b) Relating to Corrected Calculations for Past Health Benefits.--
In addition to any other payments required under section 8906(g)(2) of
title 5, United States Code, or any other provision of law, the United
States Postal Service shall pay into the Employees Health Benefits Fund
a total of $348,000,000, of which--
(1) at least one-third shall be paid not later than
September 30, 1995;
(2) at least two-thirds shall be paid not later than
September 30, 1996; and
(3) any remaining balance shall be paid not later than
September 30, 1997.
Subtitle C--Revenue Forgone Reform
SEC. 10201. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This subtitle may be cited as the ``Revenue
Forgone Reform Act''.
(b) Table of Contents.--The table of contents for this subtitle is
as follows:
Sec. 10201. Short title; table of contents.
Sec. 10202. References.
Sec. 10203. Repeal of authorization of appropriations for mail sent at
reduced rates of postage.
Sec. 10204. Establishing reduced rates of postage.
Sec. 10205. Eligibility of certain mailings for reduced rates of
postage.
Sec. 10206. Provisions relating to rates for books and certain other
materials.
Sec. 10207. Sense of Congress.
Sec. 10208. Technical corrections.
SEC. 10202. REFERENCES.
Except as otherwise expressly provided, whenever in this subtitle
an amendment or repeal is expressed in terms of an amendment to, or a
repeal of, a section or other provision, the reference shall be
considered to be made to a section or other provision of title 39,
United States Code.
SEC. 10203. REPEAL OF AUTHORIZATION OF APPROPRIATIONS FOR MAIL SENT AT
REDUCED RATES OF POSTAGE.
(a) In General.--Section 2401(c) is amended--
(1) in the first sentence--
(A) by striking ``if sections'' through ``had not
been enacted'' and inserting ``if sections 3217 and
3403-3406 had not been enacted''; and
(B) by striking ``such sections and Acts.'' and
inserting ``such sections.''; and
(2) in the second sentence--
(A) by striking ``(i)''; and
(B) by striking ``volume;'' through ``schedules.''
and inserting ``volume.''.
(b) Applicability.--The amendments made by subsection (a) shall
apply with respect to appropriations for fiscal years beginning after
September 30, 1993.
SEC. 10204. ESTABLISHING REDUCED RATES OF POSTAGE.
(a) Rates.--
(1) In general.--Section 3626(a) is amended to read as
follows:
``(a)(1) For the purpose of this subsection--
``(A) the term `costs attributable', as used with respect
to a class of mail or kind of mailer, means the direct and
indirect postal costs attributable to such class of mail or
kind of mailer (excluding any other costs of the Postal
Service);
``(B) the term `regular-rate category' means any class of
mail or kind of mailer, other than a class or kind referred to
in paragraph (2)(A) or section 2401(c); and
``(C) the term `institutional-costs contribution', as used
with respect to a class of mail or kind of mailer, means that
portion of the estimated revenues to the Postal Service from
such class of mail or kind of mailer which remains after
subtracting an amount equal to the estimated costs attributable
to such class of mail or kind of mailer.
``(2)(A) Except as provided in paragraph (3) or (4), rates of
postage for a class of mail or kind of mailer under former section
4358, 4452(b), 4452(c), 4554(b), or 4554(c) of this title shall be
established in a manner such that the estimated revenues to be received
by the Postal Service from such class of mail or kind of mailer shall
be equal to the sum of--
``(i) the estimated costs attributable to such class of
mail or kind of mailer; and
``(ii) the product derived by multiplying the estimated
costs referred to in clause (i) by the applicable percentage
under subparagraph (B).
``(B) The applicable percentage for any class of mail or kind of
mailer referred to in subparagraph (A) shall be the product derived by
multiplying--
``(i) the percentage which, for the most closely
corresponding regular-rate category, the institutional-costs
contribution for such category represents relative to the
estimated costs attributable to such category of mail, times
``(ii)(I) one-twelfth, for fiscal year 1994;
``(II) one-sixth, for fiscal year 1995;
``(III) one-fourth, for fiscal year 1996;
``(IV) one-third, for fiscal year 1997;
``(V) five-twelfths, for fiscal year 1998; and
``(VI) one-half, for any fiscal year after fiscal year
1998.
``(C) For temporary special authority to permit the timely
implementation of the preceding provisions of this paragraph, see
section 3642.
``(D) For purposes of establishing rates of postage under this
subchapter for any of the classes of mail or kinds of mailers referred
to in subparagraph (A), subclauses (I) through (V) of subparagraph
(B)(ii) shall be deemed amended by striking the fraction specified in
each such subclause and inserting `one-half'.
``(3) The rates for the advertising portion of any mail matter
under former section 4358(d) or 4358(e) of this title shall be equal to
the rates for the advertising portion of the most closely corresponding
regular-rate category of mail, except that if the advertising portion
does not exceed 10 percent of the issue of the publication involved,
the advertising portion shall be subject to the same rates as apply to
the nonadvertising portion.
``(4) The rates for any advertising under former section 4358(f) of
this title shall be equal to 75 percent of the rates for advertising
contained in the most closely corresponding regular-rate category of
mail.''.
(2) Special authority.--Subchapter III of chapter 36 is
amended by adding at the end the following:
``Sec. 3642. Special authority relating to reduced-rate categories of
mail
``(a) In order to permit the timely implementation of section
3626(a)(2), the Postal Service may establish temporary rates of postage
for any class of mail or kind of mailer referred to in section
3626(a)(2)(A).
``(b) Any exercise of authority under this section shall be in
conformance with the requirements of section 3626(a), subject to the
following:
``(1) All `attributable costs' and `institutional-costs
contributions' assumed shall be the same as those which were
assumed for purposes of the then most recent proceedings under
subchapter II pursuant to which rates of postage for the class
of mail or kind of mailer involved were last adjusted.
``(2) Any temporary rate established under this section
shall take effect upon such date as the Postal Service may
determine, except that--
``(A) such a rate may take effect only after 10
days' notice in the Federal Register; and
``(B) no such rate may take effect after September
30, 1998.
``(3) A temporary rate under this section may remain in
effect no longer than the last day of the fiscal year in which
it first takes effect.
``(4) Authority under this section may not be exercised in
a manner that would result in more than 1 change taking effect
under this section, during the same fiscal year, in the rates
of postage for a particular class of mail or kind of mailer,
except as provided in paragraph (5).
``(5) Nothing in paragraph (4) shall prevent an adjustment
under this section in rates for a class of mail or kind of
mailer with respect to which any rates took effect under this
section earlier in the same fiscal year if--
``(A) the rates established for such class of mail
or kind of mailer by the earlier adjustment are
superseded by new rates established under subchapter
II; and
``(B) authority under this paragraph has not
previously been exercised with respect to such class of
mail or kind of mailer based on the new rates referred
to in subparagraph (A).
``(c) The Postal Service may prescribe any regulations which may be
necessary to carry out this section, including provisions governing the
coordination of adjustments under this section with any other
adjustments under this title.''.
(3) Technical and conforming amendments.--
(A) Section 3626.--Section 3626(i) is repealed.
(B) Section 3627.--
(i) In general.--Section 3627 is amended--
(I) by striking ``sent at a free or
reduced rate under section 3217, 3403-
3406, or 3626 of this title,'' and
inserting ``sent free of postage under
section 3217 or 3403-3406''; and
(II) in the section heading by
striking ``and reduced''.
(ii) Table of contents.--The table of
contents for chapter 36 is amended--
(I) by striking the item relating
to section 3627 and inserting the
following:
``3627. Adjusting free rates.'';
and
(II) by inserting after the item
relating to section 3641 the following:
``3642. Special authority relating to reduced-rate categories of
mail.''.
(b) Authorization.--
(1) In general.--Section 2401 is amended--
(A) by striking subsections (d) through (f);
(B) by redesignating subsections (g) through (i) as
subsections (e) through (g), respectively;
(C) in subsection (f) (as so redesignated by
subparagraph (B)) by striking the second sentence;
(D) in subsection (g) (as so redesignated by
subparagraph (B)) by striking ``subsections (b) and (d)
of this section'' and inserting ``subsection (b)''; and
(E) by inserting after subsection (c) the
following:
``(d) As reimbursement to the Postal Service for losses which it
incurred as a result of insufficient amounts appropriated under section
2401(c) for fiscal years 1991 through 1993, and to compensate for the
additional revenues it is estimated the Postal Service would have
received under the provisions of section 3626(a), for the period
beginning on October 1, 1993, and ending on September 30, 1998, if the
fraction specified in subclause (VI) of section 3626(a)(2)(B)(ii) were
applied with respect to such period (instead of the respective
fractions specified in subclauses (I) through (V) thereof), there are
authorized to be appropriated to the Postal Service $29,000,000 for
each of fiscal years 1994 through 2035.''.
(2) Ratemaking limitations.--
(A) In general.--Except as provided in subparagraph
(B), rates of postage may not be established, under
subchapter II of chapter 36 of title 39, United States
Code, in a manner designed to allow the United States
Postal Service to receive through revenues any portion
of the additional revenues (referred to in section
2401(d) of such title, as amended by paragraph (1)(E))
for which amounts are authorized to be appropriated
under such section 2401(d).
(B) Exception.--If Congress fails to appropriate an
amount authorized under section 2401(d) of title 39,
United States Code (as amended by paragraph (1)(E)),
rates for the various classes of mail may be adjusted
in accordance with the provisions of subchapter II of
chapter 36 of such title (excluding section 3627
thereof) such that the resulting increase in revenues
will equal the amount that Congress so failed to
appropriate.
(c) Applicability.--
(1) Rates.--The amendments made by subsection (a) shall
apply with respect to rates for mail sent after September 30,
1993.
(2) Authorization.--The amendments made by subsection (b)
shall apply with respect to appropriations for fiscal years
beginning after September 30, 1993.
SEC. 10205. ELIGIBILITY OF CERTAIN MAILINGS FOR REDUCED RATES OF
POSTAGE.
(a) Advertising.--Section 3626(j)(1) is amended--
(1) in subparagraph (B) by striking ``or'' after the
semicolon;
(2) in subparagraph (C) by striking the period and
inserting ``; or''; and
(3) by adding at the end the following:
``(D) any product or service (other than any to which
subparagraph (A), (B), or (C) relates), if--
``(i) the sale of such product or the providing of
such service is not substantially related (aside from
the need, on the part of the organization promoting
such product or service, for income or funds or the use
it makes of the profits derived) to the exercise or
performance by the organization of one or more of the
purposes constituting the basis for the organization's
authorization to mail at such rates; or
``(ii) the mail matter involved is part of a
cooperative mailing (as defined under regulations of
the Postal Service) with any person or organization not
authorized to mail at the rates for mail under former
section 4452(b) or 4452(c) of this title;
except that--
``(I) any determination under clause (i) that a
product or service is not substantially related to a
particular purpose shall be made under regulations
which shall be prescribed by the Postal Service based
on subsections (a) and (c) of section 513 of the
Internal Revenue Code of 1986; and
``(II) clause (i) shall not apply if the product
involved is a periodical publication described in
subsection (m)(2) (including a subscription to receive
any such publication).''.
(b) Products.--Section 3626 is amended by adding at the end the
following:
``(m)(1) In the administration of this section, the rates for mail
under former section 4452(b) or 4452(c) of this title shall not apply
to mail consisting of products, unless such products--
``(A) were received by the organization as gifts or
contributions; or
``(B) are low cost articles (as defined by section
513(h)(2) of the Internal Revenue Code of 1986).
``(2) Paragraph (1) shall not apply with respect to a periodical
publication of a qualified nonprofit organization.''.
(c) Certification; Verification.--Section 3626(j)(3) is amended--
(1) by striking ``(3)'' and inserting ``(3)(A)''; and
(2) by adding at the end the following:
``(B) The Postal Service shall establish procedures to carry out
this paragraph, including procedures for mailer certification of
compliance with the conditions specified in paragraph (1)(D) or
subsection (m), as applicable, and verification of such compliance.''.
(d) Applicability.--The amendments made by this section shall apply
with respect to mail sent, and the rates for mail sent, after September
30, 1993.
SEC. 10206. PROVISIONS RELATING TO RATES FOR BOOKS AND CERTAIN OTHER
MATERIALS.
(a) In General.--Section 3683(b) is amended to read as follows:
``(b) The rates of postage under former section 4554(b)(1) of this
title shall not be effective except with respect to mailings which--
``(1) constitute materials specified in former section
4554(b)(2) of this title; and
``(2) are sent between--
``(A) an institution, organization, or association
listed in subparagraph (A) or (B) of such former
section 4554(b)(1) and any other such institution,
organization, or association;
``(B) an institution, organization, or association
referred to in subparagraph (A) and any individual
(other than an individual having a financial interest
in the sale, promotion, or distribution of the
materials involved); or
``(C) an institution, organization, or association
referred to in subparagraph (A) and a qualified
nonprofit organization (as defined in former section
4452(d) of this title) that is not such an institution,
organization, or association.''.
(b) Applicability.--The amendment made by subsection (a) shall
apply with respect to mail sent after September 30, 1993.
SEC. 10207. SENSE OF CONGRESS.
It is the sense of the Congress that any legislation, enacted after
September 30, 1994, which would have the effect of expanding the
classes of mail or kinds of mailers eligible for reduced rates of
postage should provide for sufficient funding to ensure that neither
any losses to the United States Postal Service nor any increase in the
rates of postage for any of the other classes of mail or kinds of
mailers will result.
SEC. 10208. TECHNICAL CORRECTIONS.
(a) Section 410.--Section 410(b) is amended--
(1) in paragraph (8) by striking ``and'' after the
semicolon;
(2) in the first paragraph (9) by striking ``Chapter'' and
inserting ``chapter'', and by striking the period and inserting
``; and''; and
(3) by designating the second paragraph (9) as paragraph
(10).
(b) Section 3202.--Section 3202(a) is amended--
(1) in paragraph (3) by adding ``and'' after the semicolon;
and
(2) in paragraph (4) by striking ``; and'' and inserting a
period.
(c) Section 3210.--The provisions of section 318(3) of Public Law
101-163 (103 Stat. 1068), which amended section 3210 of title 39,
United States Code, shall be treated as if, as enacted, the reference
in such provisions to ``subparagraph (c)'' had instead read
``subparagraph (C)''.
(d) Section 3601.--Section 3601(a) is amended by striking
``concent'' and inserting ``consent''.
(e) Section 3625.--Section 3625(d) is amended by striking ``section
3268'' and inserting ``section 3628''.
(f) Section 3626.--Section 3626 is amended by redesignating the
second subsection (k) as subsection (l).
TITLE XI--COMMITTEE ON PUBLIC WORKS AND TRANSPORTATION
SEC. 11001. AVIATION FEES FOR SERVICES.
(a) In General.--Section 313(f) of the Federal Aviation Act of 1958
(49 U.S.C. App. 1354(f)) is amended to read as follows:
``(f) Fees for Services.--
``(1) Imposition and collection.--The following fees are
imposed and shall be collected for services rendered:
``(A) Aircraft registration fees.--
``(i) General rule.--For registration of an
aircraft, the fee to be collected from the
owner of the aircraft in each fiscal year
beginning after September 30, 1993, shall be
determined under the following table:
If the maximum certificated
gross weight of Amount of
the aircraft is: fee is:
Not over 3,500 pounds......................... $40.00
Over 3,500 lbs. but not over 6,500 lbs........ $175.00
Over 6,500 lbs. but not over 10,000 lbs....... $500.00
Over 10,000 lbs. but not over 100,000 lbs..... $1,000.00
Over 100,000 lbs.............................. $2,000.00.
If the ownership of the aircraft is also transferred in
such fiscal year, the fee to be collected for
registration of the aircraft in such fiscal year under
this subparagraph, as determined from the table, shall
be increased by such amount as the Administrator shall
determine so that the average amount of the increase
for all aircraft collected under this sentence in such
fiscal year will be approximately $200.00.
``(ii) Exemptions.--No fee shall be collected under
this subparagraph for registration of an aircraft in a
fiscal year if the aircraft--
``(I) is owned or operated by an air
carrier exclusively to provide air
transportation;
``(II) is owned by, or operated exclusively
by or for, the United States Government;
``(III) is registered under a dealer's
aircraft registration certificate issued under
section 505 of this Act;
``(IV) is not originally certificated with
an engine driven electrical system or has not
subsequently been certified by the
Administrator with such a system installed; or
``(V) is a balloon or glider.
``(B) Designation as aviation medical examiners.--
For designation of a person as an aviation medical
examiner, the fee to be collected from such person in
each fiscal year beginning after September 30, 1993,
shall be $500.
``(C) Issuance of certificates to pilots.--After
September 30, 1993, the fee to be collected for
issuance or renewal of an airman's certificate to a
pilot shall be $12. The fee shall be collected from
each pilot at least once every 3 fiscal years.
``(2) Continuation of fee for processing of forms for major
fuel tank alterations.--
``(A) Establishment and collection.--The
Administrator may establish such fees as may be
necessary to cover the costs associated with processing
of forms for major repairs and alterations of fuel
tanks and fuel systems of aircraft.
``(B) Maximum amount.--The amount of any fee under
this subsection with respect to processing of a form
for a major repair or alternation of a fuel tank or
fuel system of an aircraft may not exceed $7.50. Such
maximum amount shall be adjusted annually by the
Administrator for changes in the Consumer Price Index
of All Urban Consumers published by the Bureau of Labor
Statistics of the Department of Labor.
``(3) Collection and deposit in trust fund.--The amounts of
all fees established by or under this subsection shall be
collected by the Administrator, or the Secretary of the
Treasury for the Administrator, and shall be deposited in the
Airport and Airway Trust Fund.''.
(b) Conforming Amendment.--The portion of the table of contents
contained in the first section of such Act relating to section 313 is
amended by striking
``(f) Processing fees.''.
and inserting
``(f) Fees for services.''.
SEC. 11002. RECREATIONAL USER FEES.
(a) In General.--Section 210 of the Flood Control Act of 1968 (16
U.S.C. 460d-3) is amended--
(1) by striking ``Sec. 210. No entrance'' and inserting the
following:
``SEC. 210. RECREATIONAL USER FEES.
``(a) Prohibition on Admissions Fees.--No entrance'';
(2) by striking the second sentence; and
(3) by adding at the end the following new subsection:
``(b) Fees for Use of Developed Recreation Sites and Facilities.--
``(1) Establishment and collection.--Notwithstanding
section 4(b) of the Land and Water Conservation Fund Act of
1965 (16 U.S.C. 460l-6a(b)), the Secretary of the Army is
authorized, subject to paragraphs (2) and (3), to establish and
collect fees for the use of developed recreation sites and
facilities, including campsites, swimming beaches, and boat
launching ramps.
``(2) Exemption of certain facilities.--The Secretary shall
not establish or collect fees under this subsection for the use
or provision of drinking water, wayside exhibits, general
purpose roads, overlook sites, picnic tables, toilet
facilities, surface water areas, undeveloped or lightly
developed shoreland, or general visitor information.
``(3) Per vehicle limit.--The fee under this subsection for
use of a site or facility (other than an overnight camping site
or facility or any other site or facility at which a fee is
charged for use of the site or facility as of the date of the
enactment of this paragraph) for persons entering the site or
facility by private, noncommercial vehicle shall not exceed $3
per day per vehicle. Such maximum amount may be adjusted
annually by the Secretary for changes in the Consumer Price
Index of All Urban Consumers published by the Bureau of Labor
Statistics of the Department of Labor.
``(4) Deposit into treasury account.--All fees collected
under this subsection shall be deposited into the Treasury
account for the Corps of Engineers established by section 4(i)
of the Land and Water Conservation Fund Act of 1965 (16 U.S.C.
460l-6a(i)).''.
(b) Conforming Amendment for Campsites.--Section 4(b) of the Land
and Water Conservation Fund Act of 1965 (16 U.S.C. 460l-6a(b)) is
amended by striking the next to the last sentence.
TITLE XII--COMMITTEE ON VETERANS AFFAIRS
SEC. 12001. SHORT TITLE.
This title may be cited as the ``Veterans Reconciliation Act of
1993''.
SEC. 12002. EXTENSION OF AUTHORITY TO REQUIRE THAT CERTAIN VETERANS
AGREE TO MAKE COPAYMENTS IN EXCHANGE FOR RECEIVING
HEALTH-CARE BENEFITS.
(a) Hospital and Medical Care.--Section 8013(e) of the Omnibus
Budget Reconciliation Act of 1990 (Public Law 101-508; 38 U.S.C. 1710
note) is amended--
(1) by striking out ``September 30, 1992'' in the first
sentence and inserting in lieu thereof ``September 30, 1998'';
and
(2) by striking out the second sentence.
(b) Outpatient Medications.--Section 1722A(c) of title 38, United
States Code, is amended--
(1) by striking out ``September 30, 1992'' in the first
sentence and inserting in lieu thereof ``September 30, 1998'';
and
(2) by striking out the second sentence.
SEC. 12003. EXTENSION OF AUTHORITY FOR MEDICAL CARE COST RECOVERY.
(a) In General.--Section 1729(a) of title 38, United States Code,
is amended--
(1) in paragraph (1), by striking out ``non-service-
connected''; and
(2) in paragraph (2)--
(A) by inserting ``disability and, during the
period before October 1, 1998, to a service-connected''
after ``non-service-connected'' in the matter preceding
subparagraph (A); and
(B) by striking out ``before August 1, 1994,'' in
subparagraph (E) and inserting in lieu thereof ``before
October 1, 1998,''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply with respect to care and services furnished under chapter 17 of
title 38, United States Code, after September 30, 1993.
SEC. 12004. EXTENSION OF AUTHORITY FOR CERTAIN INCOME VERIFICATION
PROVISIONS UNDER THE OMNIBUS BUDGET RECONCILIATION ACT OF
1990.
(a) Authority for Secretary of Veterans Affairs To Obtain
Information.--Section 5317(g) of title 38, United States Code, is
amended by striking out ``September 30, 1997'' and inserting in lieu
thereof ``September 30, 1998''.
(b) Authority for Secretary of Treasury To Provide Information.--
Subparagraph (D) of section 6103(l)(7) of the Internal Revenue Code of
1986 is amended by striking out ``September 30, 1997'' in the last
sentence and inserting in lieu thereof ``September 30, 1998''.
SEC. 12005. EXTENSION OF LIMITATION ON PENSION FOR CERTAIN RECIPIENTS
OF MEDICAID-COVERED NURSING HOME CARE.
Section 5503(f)(7) of title 38, United States Code, is amended by
striking out ``September 30, 1997'' and inserting in lieu thereof
``September 30, 1998''.
SEC. 12006. DENIAL OF FISCAL YEAR 1994 COST-OF-LIVING ADJUSTMENT FOR
CERTAIN DIC RECIPIENTS.
During fiscal year 1994, no increase may be provided in the rates
of dependency and indemnity compensation in effect under section
1311(a)(3) of title 38, United States Code.
SEC. 12007. EXTENSION OF PROCEDURES APPLICABLE TO LIQUIDATION SALES ON
DEFAULTED HOME LOANS GUARANTEED BY THE DEPARTMENT OF
VETERANS AFFAIRS.
(a) Inclusion of Losses.--Section 3732(c) of title 38, United
States Code, is amended--
(1) in paragraph (1)(C), by striking out ``resale,'' and
inserting in lieu thereof ``resale (including losses sustained
on the resale of the property),''; and
(2) in paragraph (11), by striking out ``December 31,
1992'' and inserting in lieu thereof ``September 30, 1998''.
(b) Effective Date.--The amendment made by subsection (a)(1) shall
apply to all liquidation sales occurring on or after October 1, 1993.
SEC. 12008. INCREASE IN HOME LOAN FEES.
Paragraph (6) of section 3729(a) of title 38, United States Code,
is amended to read as follows:
``(6) With respect to a loan closed after September 30, 1993, and
before October 1, 1998, for which a fee is collected under paragraph
(1), the amount of such fee, as computed under paragraph (2), shall be
increased by 0.75 percent of the total loan amount other than in the
case of a loan described in subparagraph (A), (D)(ii), or (E) of
paragraph (2).''.
SEC. 12009. REDUCTION OF FISCAL YEAR 1994 COST-OF-LIVING ADJUSTMENT FOR
MONTGOMERY GI BILL BENEFITS.
(a) Benefits Payable Under Chapter 30.--Section 3015(g)(1) of title
38, United States Code, is amended by inserting ``less one percentage
point'' after ``June 30, 1993,''.
(b) Benefits Payable Under Selected Reserve Program.--Section
2131(b)(2)(A) of title 10, United States Code, is amended by inserting
``less one percentage point'' after ``June 30, 1993,''.
(c) Technical Amendments.--(1) Section 301(c) of Public Law 102-568
(106 Stat. 4326) is amended by striking out ``Section 3015(f)'' and
inserting in lieu thereof ``Section 3015(g) (as redesignated by section
307(a)(1))''.
(2) Section 307(a) of such Public Law (106 Stat. 4328) is amended
by striking out ``(as amended by section 301)''.
(3) The amendments made by paragraphs (1) and (2) shall apply as if
included in the enactment of Public Law 102-568.
SEC. 12010. LIMITATION ON CHILDREN ELIGIBLE FOR SURVIVORS' AND
DEPENDENTS' EDUCATIONAL ASSISTANCE.
(a) Revision in Definition of Children Eligible.--Section
3501(a)(2) of title 38, United States Code, is amended by inserting ``,
but does not include an individual who is not the natural or legally
adopted child of the parent from whom eligibility under this chapter is
derived'' before the period at the end.
(b) Effective Date.--The amendment made by subsection (a) does not
apply with respect to any individual who, before October 1, 1993, files
an original application for educational assistance under chapter 35 of
title 38, United States Code.
TITLE XIII--COMMITTEE ON WAYS AND MEANS--SAVINGS
Subtitle A--Old-Age, Survivors, and Disability Insurance Program
TABLE OF CONTENTS OF SUBTITLE
Sec. 13001. Explicit requirements for maintenance of telephone access
to local offices of the Social Security
Administration.
Sec. 13002. Expansion of State option to exclude service of election
officials or election workers from
coverage.
Sec. 13003. Use of social security numbers by States and local
governments and Federal district courts for
jury selection purposes.
Sec. 13004. Authorization for all States to extend coverage to State
and local policemen and firemen under
existing coverage agreements.
Sec. 13005. Limited exemption for Canadian ministers from certain self-
employment tax liability.
Sec. 13006. Exclusion of totalization benefits from the application of
the windfall elimination provision.
Sec. 13007. Exclusion of military reservists from application of the
government pension offset and windfall
elimination provisions.
Sec. 13008. Repeal of the facility-of-payment provision.
Sec. 13009. Maximum family benefits in guarantee cases.
Sec. 13010. Authorization for disclosure by the Secretary of Health and
Human Services of information for purposes
of public or private epidemiological and
similar research.
Sec. 13011. Improvement and clarification of provisions prohibiting
misuse of symbols, emblems, or names in
reference to social security programs and
agencies.
Sec. 13012. Increased penalties for unauthorized disclosure of social
security information.
Sec. 13013. Simplification of employment taxes on domestic services.
Sec. 13014. Increase in authorized period for extension of time to file
annual earnings report.
Sec. 13015. Allocations to Federal Disability Insurance Trust Fund.
Sec. 13016. Extension of disability insurance program demonstration
project authority.
Sec. 13017. Technical and clerical amendments.
Sec. 13018. Cross-matching of social security account number
information and employer identification
number information maintained by the
Department of Agriculture.
Sec. 13019. Prohibition of misuse of Department of the Treasury names,
symbols, etc.
Sec. 13020. Availability and use of death information under the old-
age, survivors, and disability insurance
program.
SEC. 13001. EXPLICIT REQUIREMENTS FOR MAINTENANCE OF TELEPHONE ACCESS
TO LOCAL OFFICES OF THE SOCIAL SECURITY ADMINISTRATION.
(a) Maintenance of Service to Local Offices.--
(1) In general.--Section 5110(a) of the Omnibus Budget
Reconciliation Act of 1990 (104 Stat. 1388-272) is amended by
adding at the end the following new sentence: ``In carrying out
the requirements of the preceding sentence, the Secretary shall
reestablish and maintain in service at least the same number of
telephone lines to each such local office as was in place as of
such date, including telephone sets for connections to such
lines.''.
(2) Effective date.--The Secretary of Health and Human
Services shall ensure that the requirements of the amendment
made by paragraph (1) are carried out no later than 90 days
after the date of the enactment of this Act.
(3) GAO report.--The Comptroller General of the United
States shall make an independent determination of the number of
telephone lines to each local office of the Social Security
Administration which are in place as of 90 days after the
enactment of this Act and shall report his findings to the
Committee on Ways and Means of the House of Representatives and
the Committee on Finance of the Senate no later than 150 days
after the date of the enactment of this Act.
(b) Maintenance of Toll-Free Telephone Number Service.--The
Secretary of Health and Human Services shall ensure that toll-free
telephone service provided by the Social Security Administration is
maintained at a level which is at least equal to that in effect on the
date of the enactment of this Act.
SEC. 13002. EXPANSION OF STATE OPTION TO EXCLUDE SERVICE OF ELECTION
OFFICIALS OR ELECTION WORKERS FROM COVERAGE.
(a) Limitation on Mandatory Coverage of State Election Officials
and Election Workers Without State Retirement System.--
(1) Amendment to social security act.--Section
210(a)(7)(F)(iv) of the Social Security Act (42 U.S.C.
410(a)(7)(F)(iv)) (as amended by section 11332(a) of the
Omnibus Budget Reconciliation Act of 1990) is amended by
striking ``$100'' and inserting ``$1,000 with respect to
service performed during 1994, and the adjusted amount
determined under section 218(c)(8)(B) for any subsequent year
with respect to service performed during such subsequent
year''.
(2) Amendment to fica.--Section 3121(b)(7)(F)(iv) of the
Internal Revenue Code of 1986 (as amended by section 11332(b)
of the Omnibus Budget Reconciliation Act of 1990) is amended by
striking ``$100'' and inserting ``$1,000 with respect to
service performed during 1994, and the adjusted amount
determined under section 218(c)(8)(B) of the Social Security
Act for any subsequent year with respect to service performed
during such subsequent year''.
(b) Conforming Amendments Relating to Medicare Qualified Government
Employment.--
(1) Amendment to social security act.--Section 210(p)(2)(E)
of the Social Security Act (42 U.S.C. 410(p)(2)(E)) is amended
by striking ``$100'' and inserting ``$1,000 with respect to
service performed during 1994, and the adjusted amount
determined under section 218(c)(8)(B) for any subsequent year
with respect to service performed during such subsequent
year''.
(2) Amendment to fica.--Section 3121(u)(2)(B)(ii)(V) of the
Internal Revenue Code of 1986 is amended by striking ``$100''
and inserting ``$1,000 with respect to service performed during
1994, and the adjusted amount determined under section
218(c)(8)(B) of the Social Security Act for any subsequent year
with respect to service performed during such subsequent
year''.
(c) Authority for States To Modify Coverage Agreements With Respect
to Election Officials and Election Workers.--Section 218(c)(8) of the
Social Security Act (42 U.S.C. 418(c)(8)) is amended--
(1) by striking ``on or after January 1, 1968,'' and
inserting ``at any time'';
(2) by striking ``$100'' and inserting ``$1,000 with
respect to service performed during 1994, and the adjusted
amount determined under subparagraph (B) for any subsequent
year with respect to service performed during such subsequent
year''; and
(3) by striking the last sentence and inserting the
following new sentence: ``Any modification of an agreement
pursuant to this paragraph shall be effective with respect to
services performed in and after the calendar year in which the
modification is mailed or delivered by other means to the
Secretary.''.
(d) Indexation of Exempt Amount.--Section 218(c)(8) of such Act (as
amended by subsection (c)) is further amended--
(1) by inserting ``(A)'' after ``(8)''; and
(2) by adding at the end the following new subparagraph:
``(B) For each year after 1994, the Secretary shall adjust the
amount referred to in subparagraph (A) at the same time and in the same
manner as is provided under section 215(a)(1)(B)(ii) with respect to
the amounts referred to in section 215(a)(1)(B)(i), except that--
``(i) for purposes of this subparagraph, 1992 shall be
substituted for the calendar year referred to in section
215(a)(1)(B)(ii)(II), and
``(ii) such amount as so adjusted, if not a multiple of
$100, shall be rounded to the next higher multiple of $100
where such amount is a multiple of $50 and to the nearest
multiple of $100 in any other case.
The Secretary shall determine and publish in the Federal Register each
adjusted amount determined under this subparagraph not later than
November 1 preceding the year for which the adjustment is made.''.
(e) Effective Date.--The amendments made by subsections (a), (b),
and (c) shall apply with respect to service performed on or after
January 1, 1994.
SEC. 13003. USE OF SOCIAL SECURITY NUMBERS BY STATES AND LOCAL
GOVERNMENTS AND FEDERAL DISTRICT COURTS FOR JURY
SELECTION PURPOSES.
(a) In General.--Section 205(c)(2) of the Social Security Act (42
U.S.C. 405(c)(2)) is amended--
(1) in subparagraph (B)(i), by striking ``(E)'' in the
matter preceding subclause (I) and inserting ``(F)'';
(2) by redesignating subparagraphs (E) and (F) as
subparagraphs (F) and (G), respectively; and
(3) by inserting after subparagraph (D) the following:
``(E)(i) It is the policy of the United States that--
``(I) any State (or any political subdivision of a State)
may utilize the social security account numbers issued by the
Secretary for the additional purposes described in clause (ii)
if such numbers have been collected and are otherwise utilized
by such State (or political subdivision) in accordance with
applicable law, and
``(II) any district court of the United States may use, for
such additional purposes, any such social security account
numbers which have been so collected and are so utilized by any
State.
``(ii) The additional purposes described in this clause are the
following:
``(I) identifying duplicate names of individuals on master
lists used for jury selection purposes, and
``(II) identifying on such master lists those individuals
who are ineligible to serve on a jury by reason of their
conviction of a felony.
``(iii) To the extent that any provision of Federal law enacted
before the date of the enactment of this subparagraph is inconsistent
with the policy set forth in clause (i), such provision shall, on and
after that date, be null, void, and of no effect.
``(iv) For purposes of this subparagraph, the term `State' has the
meaning such term has in subparagraph (D).''.
(b) Effective Date.--The amendments made by subsection (a) shall
take effect on the date of the enactment of this Act.
SEC. 13004. AUTHORIZATION FOR ALL STATES TO EXTEND COVERAGE TO STATE
AND LOCAL POLICEMEN AND FIREMEN UNDER EXISTING COVERAGE
AGREEMENTS.
(a) In General.--Section 218(l) of the Social Security Act (42
U.S.C. 418(l)) is amended--
(1) in paragraph (1), by striking ``(1)'' after ``(l)'',
and by striking ``the State of'' and all that follows through
``prior to the date of enactment of this subsection'' and
inserting ``a State entered into pursuant to this section'';
and
(2) by striking paragraph (2).
(b) Conforming Amendment.--Section 218(d)(8)(D) of such Act (42
U.S.C. 418(d)(8)(D)) is amended by striking ``agreements with the
States named in'' and inserting ``State agreements modified as provided
in''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to modifications filed by States after the date of
the enactment of this Act.
SEC. 13005. LIMITED EXEMPTION FOR CANADIAN MINISTERS FROM CERTAIN SELF-
EMPLOYMENT TAX LIABILITY.
(a) In General.--Notwithstanding any other provision of law, if--
(1) an individual performed services described in section
1402(c)(4) of the Internal Revenue Code of 1986 which are
subject to tax under section 1401 of such Code,
(2) such services were performed in Canada at a time when
no agreement between the United States and Canada pursuant to
section 233 of the Social Security Act was in effect, and
(3) such individual was required to pay contributions on
the earnings from such services under the social insurance
system of Canada,
then such individual may file a certificate under this section in such
form and manner, and with such official, as may be prescribed in
regulations issued under chapter 2 of such Code. Upon the filing of
such certificate, notwithstanding any judgment which has been entered
to the contrary, such individual shall be exempt from payment of such
tax with respect to services described in paragraphs (1) and (2) and
from any penalties or interest for failure to pay such tax or to file a
self-employment tax return as required under section 6017 of such Code.
(b) Period for Filing.--A certificate referred to in subsection (a)
may be filed only during the 180-day period commencing with the date on
which the regulations referred to in subsection (a) are issued.
(c) Taxable Years Affected by Certificate.--A certificate referred
to in subsection (a) shall be effective for taxable years ending after
December 31, 1978, and before January 1, 1985.
(d) Restriction on Crediting of Exempt Self-Employment Income.--In
any case in which an individual is exempt under this section from
paying a tax imposed under section 1401 of the Internal Revenue Code of
1986, any income on which such tax would have been imposed but for such
exemption shall not constitute self-employment income under section
211(b) of the Social Security Act (42 U.S.C. 411(b)), and, if such
individual's primary insurance amount has been determined under section
215 of such Act (42 U.S.C. 415), notwithstanding section 215(f)(1) of
such Act, the Secretary of Health and Human Services shall recompute
such primary insurance amount so as to take into account the provisions
of this subsection. The recomputation under this subsection shall be
effective with respect to benefits for months following approval of the
certificate of exemption.
SEC. 13006. EXCLUSION OF TOTALIZATION BENEFITS FROM THE APPLICATION OF
THE WINDFALL ELIMINATION PROVISION.
(a) In General.--Section 215(a)(7) of the Social Security Act (42
U.S.C. 415(a)(7)) is amended--
(1) in subparagraph (A), by striking ``but excluding'' and
all that follows through ``1937'' and inserting ``but excluding
(I) a payment under the Railroad Retirement Act of 1974 or
1937, and (II) a payment by a social security system of a
foreign country based on an agreement concluded between the
United States and such foreign country pursuant to section
233''; and
(2) in subparagraph (E), by inserting after ``in the case
of an individual'' the following: ``whose eligibility for old-
age or disability insurance benefits is based on an agreement
concluded pursuant to section 233 or an individual''.
(b) Conforming Amendment Relating to Benefits Under 1939 Act.--
Section 215(d)(3) of such Act (42 U.S.C. 415(d)(3)) is amended by
striking ``but excluding'' and all that follows through ``1937'' and
inserting ``but excluding (I) a payment under the Railroad Retirement
Act of 1974 or 1937, and (II) a payment by a social security system of
a foreign country based on an agreement concluded between the United
States and such foreign country pursuant to section 233''.
(c) Effective Date.--The amendments made by this section shall
apply (notwithstanding section 215(f)(1) of the Social Security Act (42
U.S.C. 415(f)(1))) with respect to benefits payable for months after
October 1993.
SEC. 13007. EXCLUSION OF MILITARY RESERVISTS FROM APPLICATION OF THE
GOVERNMENT PENSION OFFSET AND WINDFALL ELIMINATION
PROVISIONS.
(a) Exclusion from Government Pension Offset Provisions.--
Subsections (b)(4), (c)(2), (e)(7), (f)(2), and (g)(4) of section 202
of the Social Security Act (42 U.S.C. 402 (b)(4), (c)(2), (e)(7),
(f)(2), and (g)(4)) are each amended--
(1) in subparagraph (A)(ii), by striking ``unless
subparagraph (B) applies.'';
(2) in subparagraph (A), by striking ``The'' in the matter
following clause (ii) and inserting ``unless subparagraph (B)
applies. The''; and
(3) in subparagraph (B), by redesignating the existing
matter as clause (ii), and by inserting before such clause (ii)
(as so redesignated) the following:
``(B)(i) Subparagraph (A)(i) shall not apply with respect to
monthly periodic benefits based wholly on service as a member of a
uniformed service (as defined in section 210(m)).''.
(b) Exclusion From Windfall Elimination Provisions.--Section
215(a)(7)(A) of such Act (as amended by section 13006(a) of this Act)
and section 215(d)(3) of such Act (as amended by section 13006(b) of
this Act) are each further amended--
(1) by striking ``and'' before ``(II)''; and
(2) by striking ``section 233'' and inserting ``section
233, and (III) a payment based wholly on service as a member of
a uniformed service (as defined in section 210(m))''.
(c) Effective Date.--The amendments made by this section shall
apply (notwithstanding section 215(f) of the Social Security Act) with
respect to benefits payable for months after October 1993.
SEC. 13008. REPEAL OF THE FACILITY-OF-PAYMENT PROVISION.
(a) Repeal of Rule Precluding Redistribution Under Family
Maximum.--Section 203(i) of the Social Security Act (42 U.S.C. 403(i))
is repealed.
(b) Coordination Under Family Maximum of Reduction in Beneficiary's
Auxiliary Benefits With Suspension of Auxiliary Benefits of Other
Beneficiary Under Earnings Test.--Section 203(a)(4) of such Act (42
U.S.C. 403(a)(4)) is amended by striking ``section 222(b). Whenever''
and inserting the following: ``section 222(b). Notwithstanding the
preceding sentence, any reduction under this subsection in the case of
an individual who is entitled to a benefit under subsection (b), (c),
(d), (e), (f), (g), or (h) of section 202 for any month on the basis of
the same wages and self-employment income as another person--
``(A) who also is entitled to a benefit under subsection
(b), (c), (d), (e), (f), (g), or (h) of section 202 for such
month,
``(B) who does not live in the same household as such
individual, and
``(C) whose benefit for such month is suspended (in whole
or in part) pursuant to subsection (h)(3) of this section,
shall be made before the suspension under subsection (h)(3).
Whenever''.
(c) Conforming Amendment Applying Earnings Reporting Requirement
Despite Suspension of Benefits.--The third sentence of section
203(h)(1)(A) of such Act (42 U.S.C. 403(h)(1)(A)) is amended by
striking ``Such report need not be made'' and all that follows through
``The Secretary may grant'' and inserting the following: ``Such report
need not be made for any taxable year--
``(i) beginning with or after the month in which such
individual attained age 70, or
``(ii) if benefit payments for all months (in such taxable
year) in which such individual is under age 70 have been
suspended under the provisions of the first sentence of
paragraph (3) of this subsection, unless--
``(I) such individual is entitled to benefits under
subsection (b), (c), (d), (e), (f), (g), or (h) of
section 202,
``(II) such benefits are reduced under subsection
(a) of this section for any month in such taxable year,
and
``(III) in any such month there is another person
who also is entitled to benefits under subsection (b),
(c), (d), (e), (f), (g), or (h) of section 202 on the
basis of the same wages and self-employment income and
who does not live in the same household as such
individual.
The Secretary may grant''.
(d) Conforming Amendment Deleting Special Income Tax Treatment of
Benefits No Longer Required by Reason of Repeal.--Section 86(d)(1) of
the Internal Revenue Code of 1986 (relating to income tax on social
security benefits) is amended by striking the last sentence.
(e) Effective Dates.--
(1) The amendments made by subsections (a), (b), and (c)
shall apply with respect to benefits payable for months after
December 1994.
(2) The amendment made by subsection (d) shall apply with
respect to benefits received after December 31, 1994, in
taxable years ending after such date.
SEC. 13009. MAXIMUM FAMILY BENEFITS IN GUARANTEE CASES.
(a) In General.--Section 203(a) of the Social Security Act (42
U.S.C. 403(a)) is amended by adding at the end the following new
paragraph:
``(10)(A) Subject to subparagraphs (B) and (C)--
``(i) the total monthly benefits to which beneficiaries may
be entitled under sections 202 and 223 for a month on the basis
of the wages and self- employment income of an individual whose
primary insurance amount is computed under section
215(a)(2)(B)(i) shall equal the total monthly benefits which
were authorized by this section with respect to such
individual's primary insurance amount for the last month of his
prior entitlement to disability insurance benefits, increased
for this purpose by the general benefit increases and other
increases under section 215(i) that would have applied to such
total monthly benefits had the individual remained entitled to
disability insurance benefits until the month in which he
became entitled to old-age insurance benefits or reentitled to
disability insurance benefits or died, and
``(ii) the total monthly benefits to which beneficiaries
may be entitled under sections 202 and 223 for a month on the
basis of the wages and self- employment income of an individual
whose primary insurance amount is computed under section
215(a)(2)(C) shall equal the total monthly benefits which were
authorized by this section with respect to such individual's
primary insurance amount for the last month of his prior
entitlement to disability insurance benefits.
``(B) In any case in which--
``(i) the total monthly benefits with respect to such
individual's primary insurance amount for the last month of his
prior entitlement to disability insurance benefits was computed
under paragraph (6), and
``(ii) the individual's primary insurance amount is
computed under subparagraph (B)(i) or (C) of section 215(a)(2)
by reason of the individual's entitlement to old-age insurance
benefits or death,
the total monthly benefits shall equal the total monthly benefits that
would have been authorized with respect to the primary insurance amount
for the last month of his prior entitlement to disability insurance
benefits if such total monthly benefits had been computed without
regard to paragraph (6).
``(C) This paragraph shall apply before the application of
paragraph (3)(A), and before the application of section 203(a)(1) of
this Act as in effect in December 1978.''.
(b) Conforming Amendment.--Section 203(a)(8) of such Act (42 U.S.C.
403(a)(8)) is amended by striking ``Subject to paragraph (7),'' and
inserting ``Subject to paragraph (7) and except as otherwise provided
in paragraph (10)(C),''.
(c) Effective Date.--The amendments made by this section shall
apply for the purpose of determining the total monthly benefits to
which beneficiaries may be entitled under sections 202 and 223 of the
Social Security Act based on the wages and self-employment income of an
individual who--
(1) becomes entitled to an old-age insurance benefit under
section 202(a) of such Act,
(2) becomes reentitled to a disability insurance benefit
under section 223 of such Act, or
(3) dies,
after October 1993.
SEC. 13010. AUTHORIZATION FOR DISCLOSURE BY THE SECRETARY OF HEALTH AND
HUMAN SERVICES OF INFORMATION FOR PURPOSES OF PUBLIC OR
PRIVATE EPIDEMIOLOGICAL AND SIMILAR RESEARCH.
(a) In General.--Section 1106 of the Social Security Act (42 U.S.C.
1306) is amended--
(1) by redesignating subsections (d) and (e) as subsections
(e) and (f), respectively;
(2) in subsection (f) (as so redesignated), by striking
``subsection (d)'' and inserting ``subsection (e)''; and
(3) by inserting after subsection (c) the following new
subsection:
``(d) Notwithstanding any other provision of this section, in any
case in which--
``(1) information regarding whether an individual is shown
on the records of the Secretary as being alive or deceased is
requested from the Secretary for purposes of epidemiological or
similar research which the Secretary finds may reasonably be
expected to contribute to a national health interest, and
``(2) the requester agrees to reimburse the Secretary for
providing such information and to comply with limitations on
safeguarding and rerelease or redisclosure of such information
as may be specified by the Secretary,
the Secretary shall comply with such request, except to the extent that
compliance with such request would constitute a violation of the terms
of any contract entered into under section 205(r).''.
(b) Availability of Information Returns Regarding Wages Paid
Employees.--Section 6103(l)(5) of the Internal Revenue Code of 1986
(relating to disclosure of returns and return information to the
Department of Health and Human Services for purposes other than tax
administration) is amended--
(1) by striking ``for the purpose of'' and inserting ``for
the purpose of--'';
(2) by striking ``carrying out, in accordance with an
agreement'' and inserting the following:
``(A) carrying out, in accordance with an
agreement'';
(3) by striking ``program.'' and inserting ``program; or'';
and
(4) by adding at the end the following new subparagraph:
``(B) providing information regarding the mortality
status of individuals for epidemiological and similar
research in accordance with section 1106(d) of the
Social Security Act.''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to requests for information made after the date of
the enactment of this Act.
SEC. 13011. IMPROVEMENT AND CLARIFICATION OF PROVISIONS PROHIBITING
MISUSE OF SYMBOLS, EMBLEMS, OR NAMES IN REFERENCE TO
SOCIAL SECURITY PROGRAMS AND AGENCIES.
(a) Prohibition of Unauthorized Reproduction, Reprinting, or
Distribution for Fee of Certain Official Publications.--Section 1140(a)
of the Social Security Act (42 U.S.C. 1320b-10(a)) is amended--
(1) by redesignating paragraphs (1) and (2) as
subparagraphs (A) and (B), respectively;
(2) by inserting ``(1)'' after ``(a)''; and
(3) by adding at the end the following new paragraph:
``(2) No person may, for a fee, reproduce, reprint, or distribute
any item consisting of a form, application, or other publication of the
Social Security Administration unless such person has obtained
specific, written authorization for such activity in accordance with
regulations which the Secretary shall prescribe.''.
(b) Addition to Prohibited Words, Letters, Symbols, and Emblems.--
Paragraph (1) of section 1140(a) of such Act (as redesignated by
subsection (a)) is further amended--
(1) in subparagraph (A) (as redesignated), by striking
``Administration', the letters `SSA' or `HCFA','' and inserting
``Administration', `Department of Health and Human Services',
`Health and Human Services', `Supplemental Security Income
Program', or `Medicaid', the letters `SSA', `HCFA', `DHHS',
`HHS', or `SSI',''; and
(2) in subparagraph (B) (as redesignated), by striking
``Social Security Administration'' each place it appears and
inserting ``Social Security Administration, Health Care
Financing Administration, or Department of Health and Human
Services'', and by striking ``or of the Health Care Financing
Administration''.
(c) Exemption for Use of Words, Letters, Symbols, and Emblems of
State and Local Government Agencies by Such Agencies.--Paragraph (1) of
section 1140(a) of such Act (as redesignated by subsection (a)) is
further amended by adding at the end the following new sentence: ``The
preceding provisions of this subsection shall not apply with respect to
the use by any agency or instrumentality of a State or political
subdivision of a State of any words or letters which identify an agency
or instrumentality of such State or of a political subdivision of such
State or the use by any such agency or instrumentality of any symbol or
emblem of an agency or instrumentality of such State or a political
subdivision of such State.''.
(d) Inclusion of Reasonableness Standard.--Section 1140(a)(1) of
such Act (as amended by the preceding provisions of this section) is
further amended, in the matter following subparagraph (B) (as
redesignated), by striking ``convey'' and inserting ``convey, or in a
manner which reasonably could be interpreted or construed as
conveying,''.
(e) Ineffectiveness of Disclaimers.--Subsection (a) of section 1140
of such Act (as amended by the preceding provisions of this section) is
further amended by adding at the end the following new paragraph:
``(3) Any determination of whether the use of one or more words,
letters, symbols, or emblems (or any combination or variation thereof)
in connection with an item described in paragraph (1) or the
reproduction, reprinting, or distribution of an item described in
paragraph (2) is a violation of this subsection shall be made without
regard to any inclusion in such item (or any so reproduced, reprinted,
or distributed copy thereof) of a disclaimer of affiliation with the
United States Government or any particular agency or instrumentality
thereof.''.
(f) Violations With Respect to Individual Items.--Section
1140(b)(1) of such Act (42 U.S.C. 1320b-10(b)(1)) is amended by adding
at the end the following new sentence: ``In the case of any items
referred to in subsection (a)(1) consisting of pieces of mail, each
such piece of mail which contains one or more words, letters, symbols,
or emblems in violation of subsection (a) shall represent a separate
violation. In the case of any item referred to in subsection (a)(2),
the reproduction, reprinting, or distribution of such item shall be
treated as a separate violation with respect to each copy thereof so
reproduced, reprinted, or distributed.''.
(g) Elimination of Cap on Aggregate Liability Amount.--
(1) Repeal.--Paragraph (2) of section 1140(b) of such Act
(42 U.S.C. 1320b-10(b)(2)) is repealed.
(2) Conforming amendments.--Section 1140(b) of such Act is
further amended--
(A) by striking ``(1) Subject to paragraph (2),
the'' and inserting ``The'';
(B) by redesignating subparagraphs (A) and (B) as
paragraphs (1) and (2), respectively; and
(C) in paragraph (1) (as redesignated), by striking
``subparagraph (B)'' and inserting ``paragraph (2)''.
(h) Removal of Formal Declination Requirement.--Section 1140(c)(1)
of such Act (42 U.S.C. 1320b-10(c)(1)) is amended by inserting ``and
the first sentence of subsection (c)'' after ``and (i)''.
(i) Penalties Relating to Social Security Administration Deposited
in OASI Trust Fund.--Section 1140(c)(2) of such Act (42 U.S.C. 1320b-
10(c)(2)) is amended in the second sentence by striking ``United
States.'' and inserting ``United States, except that, to the extent
that such amounts are recovered under this section as penalties imposed
for misuse of words, letters, symbols, or emblems relating to the
Social Security Administration, such amounts shall be deposited into
the Federal Old-Age and Survivor's Insurance Trust Fund.''.
(j) Enforcement.--Section 1140 of such Act (42 U.S.C. 1320b-10) is
amended by adding at the end the following new subsection:
``(d) The preceding provisions of this section shall be enforced
through the Office of Inspector General of the Department of Health and
Human Services.''.
(k) Annual Reports.--Section 1140 of such Act (as amended by the
preceding provisions of this section) is further amended by adding at
the end the following new subsection:
``(e) The Secretary shall include in the annual report submitted
pursuant to section 704 a report on the operation of this section
during the year covered by such annual report. Such report shall
specify--
``(1) the number of complaints of violations of this
section received by the Social Security Administration during
the year,
``(2) the number of cases in which a notice of violation of
this section was sent by the Social Security Administration
during the year requesting that an individual cease activities
in violation of this section,
``(3) the number of complaints of violations of this
section referred by the Social Security Administration to the
Inspector General in the Department of Health and Human
Services during the year,
``(4) the number of investigations of violations of this
section undertaken by the Inspector General during the year,
``(5) the number of cases in which a demand letter was sent
during the year assessing a civil money penalty under this
section,
``(6) the total amount of civil money penalties assessed
under this section during the year,
``(7) the number of requests for hearings filed during the
year pursuant to subsection (c)(1) of this section and section
1128A(c)(2),
``(8) the disposition during such year of hearings filed
pursuant to sections 1140(c)(1) and 1128A(c)(2), and
``(9) the total amount of civil money penalties under this
section deposited into the Federal Old-Age and Survivors
Insurance Trust Fund during the year.''.
(l) Effective Date.--The amendments made by this section shall
apply with respect to violations occurring after the date of the
enactment of this Act.
SEC. 13012. INCREASED PENALTIES FOR UNAUTHORIZED DISCLOSURE OF SOCIAL
SECURITY INFORMATION.
(a) Unauthorized Disclosure.--Section 1106(a) of the Social
Security Act (42 U.S.C. 1306(a)) is amended--
(1) by striking ``misdemeanor'' and inserting ``felony'';
(2) by striking ``$1,000'' and inserting ``$10,000 for each
occurrence of a violation''; and
(3) by striking ``one year'' and inserting ``5 years''.
(b) Unauthorized Disclosure by Fraud.--Section 1107(b) of such Act
(42 U.S.C. 1307(b)) is amended--
(1) by inserting ``social security account number,'' after
``information as to the'';
(2) by striking ``misdemeanor'' and inserting ``felony'';
(3) by striking ``$1,000'' and inserting ``$10,000 for each
occurrence of a violation''; and
(4) by striking ``one year'' and inserting ``5 years''.
(c) Effective Date.--The amendments made by this section shall
apply to violations occurring on or after the date of the enactment of
this Act.
SEC. 13013. SIMPLIFICATION OF EMPLOYMENT TAXES ON DOMESTIC SERVICES.
(a) Coordination of Collection of Domestic Service Employment With
Collection of Income Taxes.--
(1) In general.--Chapter 25 of the Internal Revenue Code of
1986 (relating to general provisions relating to employment
taxes) is amended by adding at the end thereof the following
new section:
``SEC. 3510. COORDINATION OF COLLECTION OF DOMESTIC SERVICE EMPLOYMENT
TAXES WITH COLLECTION OF INCOME TAXES.
``(a) General Rule.--Except as otherwise provided in this section--
``(1) returns with respect to domestic service employment
taxes shall be made on a calendar year basis,
``(2) any such return for any calendar year shall be filed
on or before the 15th day of the fourth month following the
close of the employer's taxable year which begins in such
calendar year, and
``(3) no requirement to make deposits (or to pay
installments under section 6157) shall apply with respect to
such taxes.
``(b) Domestic Service Employment Taxes Subject to Estimated Tax
Provisions.--
``(1) In general.--Solely for purposes of section 6654,
domestic service employment taxes imposed with respect to any
calendar year shall be treated as a tax imposed by chapter 2
for the taxable year of the employer which begins in such
calendar year.
``(2) Annualization.--Under regulations prescribed by the
Secretary, appropriate adjustments shall be made in the
application of section 6654(d)(2) in respect of the amount
treated as tax under paragraph (1).
``(3) Transitional rule.--For purposes of applying section
6654 to a taxable year beginning in 1993, the amount referred
to in clause (ii) of section 6654(d)(1)(B) shall be increased
by 90 percent of the amount treated as tax under paragraph (1)
for such taxable year.
``(c) Domestic Service Employment Taxes.--For purposes of this
section, the term `domestic service employment taxes' means--
``(1) any taxes imposed by chapter 21 or 23 on remuneration
paid for domestic service in a private home of the employer,
and
``(2) any amount withheld from such remuneration pursuant
to an agreement under section 3402(p).
For purposes of this subsection, the term `domestic service in a
private home of the employer' does not include service described in
section 3121(g)(5).
``(d) Exception Where Employer Liable for Other Employment Taxes.--
To the extent provided in regulations prescribed by the Secretary, this
section shall not apply to any employer for any calendar year if such
employer is liable for any tax under this subtitle with respect to
remuneration for services other than domestic service in a private home
of the employer.
``(e) General Regulatory Authority.--The Secretary shall prescribe
such regulations as may be necessary or appropriate to carry out the
purposes of this section. Such regulations may treat domestic service
employment taxes as taxes imposed by chapter 1 for purposes of
coordinating the assessment and collection of such employment taxes
with the assessment and collection of domestic employers' income taxes.
``(f) Authority To Enter Into Agreements To Collect State
Unemployment Taxes.--
``(1) In general.--The Secretary is hereby authorized to
enter into an agreement with any State to collect, as the agent
of such State, such State's unemployment taxes imposed on
remuneration paid for domestic service in a private home of the
employer. Any taxes to be collected by the Secretary pursuant
to such an agreement shall be treated as domestic service
employment taxes for purposes of this section.
``(2) Transfers to state account.--Any amount collected
under an agreement referred to in paragraph (1) shall be
transferred by the Secretary to the account of the State in the
Unemployment Trust Fund.
``(3) Subtitle f made applicable.--For purposes of subtitle
F, any amount required to be collected under an agreement under
paragraph (1) shall be treated as a tax imposed by chapter 23.
``(4) State.--For purposes of this subsection, the term
`State' has the meaning given such term by section
3306(j)(1).''
(2) Clerical amendment.--The table of sections for chapter
25 of such Code is amended by adding at the end thereof the
following:
``Sec. 3510. Coordination of collection
of domestic service employment
taxes with collection of income
taxes.''
(3) Effective date.--The amendments made by this subsection
shall apply to remuneration paid in calendar years beginning
after December 31, 1993.
(4) Expanded information to employers.--The Secretary of
the Treasury or his delegate shall prepare and make available
information on the Federal tax obligations of employers with
respect to employees performing domestic service in a private
home of the employer. Such information shall also include a
statement that such employers may have obligations with respect
to such employees under State laws relating to unemployment
insurance and workers compensation.
(b) Threshold Requirement for Social Security Taxes.--
(1) Amendments of internal revenue code.--
(A) Subparagraph (B) of section 3121(a)(7) of the
Internal Revenue Code of 1986 (defining wages) is
amended to read as follows:
``(B) cash remuneration paid by an employer in any
calendar year to an employee for domestic service in a
private home of the employer (within the meaning of
subsection (y)), if the cash remuneration paid in such
year by the employer to the employee for such service
is less than the applicable dollar threshold (as
defined in subsection (y)) for such year;''.
(B) Section 3121 of such Code is amended by adding
at the end thereof the following new subsection:
``(y) Domestic Service in a Private Home.--For purposes of
subsection (a)(7)(B)--
``(1) Exclusion for certain farm service.--The term
`domestic service in a private home of the employer' does not
include service described in subsection (g)(5).
``(2) Applicable dollar threshold.--The term `applicable
dollar threshold' means $1,800. In the case of calendar years
after 1994, the Secretary of Health and Human Services shall
adjust such $1,800 amount at the same time and in the same
manner as under section 215(a)(1)(B)(ii) of the Social Security
Act with respect to the amounts referred to in section
215(a)(1)(B)(i) of such Act, except that, for purposes of this
subparagraph, 1992 shall be substituted for the calendar year
referred to in section 215(a)(1)(B)(ii)(II) of such Act. If the
amount determined under the preceding sentence is not a
multiple of $50, such amount shall be rounded to the nearest
multiple of $50.''
(C) The second sentence of section 3102(a) of such
Code is amended--
(i) by striking ``calendar quarter'' each
place it appears and inserting ``calendar
year'', and
(ii) by striking ``$50'' and inserting
``the applicable dollar threshold (as defined
in section 3121(y)(2)) for such year''.
(2) Amendment of social security act.--Subparagraph (B) of
section 209(a)(6) of the Social Security Act (42 U.S.C.
409(a)(6)(B)) is amended to read as follows:
``(B) Cash remuneration paid by an employer in any calendar
year to an employee for domestic service in a private home of
the employer, if the cash remuneration paid in such year by the
employer to the employee for such service is less than the
applicable dollar threshold (as defined in section 3121(y)(2)
of the Internal Revenue Code of 1986) for such year. As used in
this subparagraph, the term `domestic service in a private home
of the employer' does not include service described in section
210(f)(5).''
(3) Effective date.--The amendments made by this subsection
shall apply to remuneration paid in calendar years beginning
after December 31, 1993.
(4) Relief from liability for certain underpayment
amounts.--
(A) In general.--On and after the date of the
enactment of this Act, an underpayment to which this
paragraph applies (and any penalty, addition to tax,
and interest with respect to such underpayment) shall
not be assessed (or, if assessed, shall not be
collected).
(B) Underpayments to which paragraph applies.--This
paragraph shall apply to an underpayment to the extent
of the amount thereof which would not be an
underpayment if--
(i) the amendments made by paragraph (1)
had applied to all calendar years after 1950
and before 1994, and
(ii) the applicable dollar threshold for
any such calendar year were the amount
determined under the following table:
In the case of
The applicable
calendar year:
dollar threshold is:
1951, 1952, or 1953........................ $ 200
1954, 1955, 1956, or 1957.................. 250
1958, 1959, 1960, 1961, or 1962............ 300
1963, 1964, 1965, or 1966.................. 350
1967, 1968, 1969........................... 400
1970....................................... 450
1971, 1972, or 1973........................ 500
1974 or 1975............................... 600
1976....................................... 650
1977....................................... 700
1978....................................... 750
1979....................................... 800
1980....................................... 850
1981....................................... 900
1982....................................... 1,000
1983....................................... 1,100
1984....................................... 1,200
1985....................................... 1,250
1986....................................... 1,300
1987....................................... 1,350
1988....................................... 1,400
1989....................................... 1,500
1990....................................... 1,550
1991....................................... 1,600
1992....................................... 1,700
1993....................................... 1,750
SEC. 13014. INCREASE IN AUTHORIZED PERIOD FOR EXTENSION OF TIME TO FILE
ANNUAL EARNINGS REPORT.
(a) In General.--Section 203(h)(1)(A) of the Social Security Act
(42 U.S.C. 403(h)(1)(A)) is amended in the last sentence by striking
``three months'' and inserting ``four months''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply with respect to reports of earnings for taxable years ending on
or after December 31, 1993.
SEC. 13015. ALLOCATIONS TO FEDERAL DISABILITY INSURANCE TRUST FUND.
(a) Allocation With Respect to Wages.--Section 201(b)(1) of the
Social Security Act (42 U.S.C. 401(b)(1)) is amended to read as
follows:
``(1) 1.75 percent of the wages (as defined in section 3121
of the Internal Revenue Code of 1986) paid after December 31,
1992, and reported to the Secretary of the Treasury or his
delegate pursuant to subtitle F of the Internal Revenue Code of
1986, which wages shall be certified by the Secretary of Health
and Human Services on the basis of the records of wages
established and maintained by such Secretary in accordance with
such reports; and''.
(b) Allocation With Respect to Self-Employment Income.--Section
201(b)(2) of such Act (42 U.S.C. 401(b)(2)) is amended to read as
follows:
``(2) 1.75 percent of the self-employment income (as
defined in section 1402 of the Internal Revenue Code of 1986)
reported to the Secretary of the Treasury or his delegate on
tax returns under subtitle F of the Internal Revenue Code of
1986 for any taxable year beginning after December 31, 1992,
which self-employment income shall be certified by the
Secretary of Health and Human Services on the basis of the
records of self-employment income established and maintained by
the Secretary of Health and Human Services in accordance with
such returns.''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to wages paid after December 31, 1992, and self-
employment income for taxable years beginning after such date.
(d) Study on Rising Costs of Disability Benefits.--
(1) In general.--As soon as practicable after the date of
the enactment of this Act, the Secretary of Health and Human
Services shall conduct a comprehensive study of the reasons for
rising costs payable from the Federal Disability Insurance
Trust Fund.
(2) Matters to be included in study.--In conducting the
study under this subsection, the Secretary shall--
(A) determine the relative importance of the
following factors in increasing the costs payable from
the Trust Fund:
(i) increased numbers of applications for
benefits;
(ii) higher rates of benefit allowances;
and
(iii) decreased rates of benefit
terminations; and
(B) identify, to the extent possible, underlying
social, economic, demographic, programmatic, and other
trends responsible for changes in disability benefit
applications, allowances, and terminations.
(3) Report.--Not later than December 31, 1995, the
Secretary shall transmit a report to the Committee on Ways and
Means of the House of Representatives and the Committee on
Finance of the Senate setting forth the results of the study
conducted under this subsection, together with any
recommendations for legislative changes which the Secretary
determines appropriate.
SEC. 13016. EXTENSION OF DISABILITY INSURANCE PROGRAM DEMONSTRATION
PROJECT AUTHORITY.
(a) In General.--Section 505 of the Social Security Disability
Amendments of 1980 (Public Law 96-265), as amended by section 12101 of
the Consolidated Omnibus Budget Reconciliation Act of 1985 (Public Law
99-272), section 10103 of the Omnibus Budget Reconciliation Act of 1989
(Public Law 101-239), and section 5120 of the Omnibus Budget
Reconciliation Act of 1990 (Public Law 101-508) is further amended--
(1) in paragraph (3) of subsection (a), by striking ``June
10, 1993'' and inserting ``June 10, 1996'';
(2) in paragraph (4) of subsection (a), by striking
``1992'' and inserting ``1995''; and
(3) in subsection (c), by striking ``October 1, 1993'' and
inserting ``June 9, 1996''.
(b) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act.
SEC. 13017. TECHNICAL AND CLERICAL AMENDMENTS.
(a) Amendments to Title II of the Social Security Act.--
(1) Section 201(a) of the Social Security Act (42 U.S.C.
401(a)) is amended, in the matter following clause (4), by
striking ``and and'' and inserting ``and''.
(2) Section 202(d)(8)(D)(ii) of such Act (42 U.S.C.
402(d)(8)(D)(ii)) is amended by adding a period at the end and
by adjusting the left hand margination thereof so as to align
with section 202(d)(8)(D)(i) of such Act.
(3) Section 202(q)(1)(A) of such Act (42 U.S.C.
402(q)(1)(A)) is amended by striking the dash at the end.
(4) Section 202(q)(9) of such Act (42 U.S.C. 402(q)(9)) is
amended, in the matter preceding subparagraph (A), by striking
``parargaph'' and inserting ``paragraph''.
(5) Section 202(t)(4)(D) of such Act (42 U.S.C.
402(t)(4)(D)) is amended by inserting ``if the'' before
``Secretary'' the second and third places it appears.
(6) Clauses (i) and (ii) of section 203(f)(5)(C) of such
Act (42 U.S.C. 403(f)(5)(C)) are amended by adjusting the left-
hand margination thereof so as to align with clauses (i) and
(ii) of section 203(f)(5)(B) of such Act.
(7) Paragraph (3)(A) and paragraph (3)(B) of section 205(b)
of such Act (42 U.S.C. 405(b)) are amended by adjusting the
left-hand margination thereof so as to align with the matter
following section 205(b)(2)(C) of such Act.
(8) Section 205(c)(2)(B)(iii) of such Act (42 U.S.C.
405(c)(2)(B)(iii)) is amended by striking ``non-public'' and
inserting ``nonpublic''.
(9) Section 205(c)(2)(C) of such Act (42 U.S.C.
405(c)(2)(C)) is amended--
(A) by striking the clause (vii) added by section
2201(c) of Public Law 101-624; and
(B) by redesignating the clause (iii) added by
section 2201(b)(3) of Public Law 101-624, clause (iv),
clause (v), clause (vi), and the clause (vii) added by
section 1735(b) of Public Law 101-624 as clause (iv),
clause (v), clause (vi), clause (vii), and clause
(viii), respectively;
(C) in clause (v) (as redesignated), by striking
``subclause (I) of'', and by striking ``subclause (II)
of clause (i)'' and inserting ``clause (ii)''; and
(D) in clause (viii)(IV) (as redesignated), by
inserting ``a social security account number or''
before ``a request for''.
(10) The heading for section 205(j) of such Act (42 U.S.C.
405(j)) is amended to read as follows:
``Representative Payees''.
(11) The heading for section 205(s) of such Act (42 U.S.C.
405(s)) is amended to read as follows:
``Notice Requirements''.
(12) Section 208(c) of such Act (42 U.S.C. 408(c)) is
amended by striking ``subsection (g)'' and inserting
``subsection (a)(7)''.
(13) Section 210(a)(5)(B)(i)(V) of such Act (42 U.S.C.
410(a)(5)(B)(i)(V)) is amended by striking ``section
105(e)(2)'' and inserting ``section 104(e)(2)''.
(14) Section 211(a) of such Act (42 U.S.C. 411(a)) is
amended--
(A) in paragraph (13), by striking ``and'' at the
end; and
(B) in paragraph (14), by striking the period and
inserting ``; and''.
(15) Section 213(c) of such Act (42 U.S.C. 413(c)) is
amended by striking ``section'' the first place it appears and
inserting ``sections''.
(16) Section 215(a)(5)(B)(i) of such Act (42 U.S.C.
415(a)(5)(B)(i)) is amended by striking ``subsection'' the
second place it appears and inserting ``subsections''.
(17) Section 215(f)(7) of such Act (42 U.S.C. 415(f)(7)) is
amended by inserting a period after ``1990''.
(18) Subparagraph (F) of section 218(c)(6) of such Act (42
U.S.C. 418(c)(6)) is amended by adjusting the left-hand
margination thereof so as to align with section 218(c)(6)(E) of
such Act.
(19) Section 223(i) of such Act (42 U.S.C. 423(i)) is
amended by adding at the beginning the following heading:
``Limitation on Payments to Prisoners''.
(b) Related Amendments.--
(1) Section 603(b)(5)(A) of Public Law 101-649 (amending
section 202(n)(1) of the Social Security Act) (104 Stat. 5085)
is amended by inserting ``under'' before ``paragraph (1),'' and
by striking ``(17), or (18)'' and inserting ``(17), (18), or
(19)'', effective as if this paragraph were included in such
section 603(b)(5)(A).
(2) Section 10208(b)(1) of Public Law 101-239 (amending
section 230(b)(2)(A) of the Social Security Act) (103 Stat.
2477) is amended by striking ``230(b)(2)(A)'' and
``430(b)(2)(A)'' and inserting ``230(b)(2)'' and ``430(b)(2)'',
respectively, effective as if this paragraph were included in
such section 10208(b)(1).
(c) Conforming, Clerical Amendments Updating, Without Substantive
Change, References in Title II of the Social Security Act to the
Internal Revenue Code.--
(1)(A) Section 201(a) of such Act (42 U.S.C. 401(a)) is
amended--
(i) by striking clauses (1) and (2);
(ii) in clause (3), by striking ``(3) the taxes
imposed'' and all that follows through ``December 31,
1954,'' and inserting ``(1) the taxes imposed by
chapter 21 (other than sections 3101(b) and 3111(b)) of
the Internal Revenue Code of 1986 with respect to wages
(as defined in section 3121 of such Code) reported to
the Secretary of the Treasury or his delegate pursuant
to subtitle F of such Code,'', and by striking
``subchapter or'';
(iii) in clause (4), by striking ``(4) the taxes
imposed'' and all that follows through ``such Code,''
and inserting ``(2) the taxes imposed by chapter 2
(other than section 1401(b)) of the Internal Revenue
Code of 1986 with respect to self-employment income (as
defined in section 1402 of such Code) reported to the
Secretary of the Treasury or his delegate on tax
returns under subtitle F of such Code,'', and by
striking ``subchapter or chapter'' and inserting
``chapter''; and
(iv) in the matter following the clauses amended by
this subparagraph, by striking ``clauses (3) and (4)''
each place it appears and inserting ``clauses (1) and
(2)''.
(B) The amendments made by subparagraph (A) shall apply
only with respect to taxes imposed with respect to wages paid
on or after January 1, 1993, or with respect to self-employment
income for taxable years beginning on or after such date.
(2)(A)(i) Section 201(g)(1) of such Act (42 U.S.C.
401(g)(1)) is amended--
(I) in subparagraph (A)(i), by striking ``and
subchapter E'' and all that follows through ``1954''
and inserting ``and chapters 2 and 21 of the Internal
Revenue Code of 1986'';
(II) in subparagraph (A)(ii), by striking ``1954''
and inserting ``1986'';
(III) in the matter in subparagraph (A) following
clause (ii), by striking ``subchapter E'' and all that
follows through ``1954.'' and inserting ``chapters 2
and 21 of the Internal Revenue Code of 1986.'', and by
striking ``1954 other'' and inserting ``1986 other'';
and
(IV) in subparagraph (B), by striking ``1954'' each
place it appears and inserting ``1986''.
(ii) The amendments made by clause (i) shall apply only
with respect to periods beginning on or after the date of the
enactment of this Act.
(B)(i) Section 201(g)(2) of such Act (42 U.S.C. 401(g)(2))
is amended by striking ``section 3101(a)'' and all that follows
through ``1950.'' and inserting ``section 3101(a) of the
Internal Revenue Code of 1986 which are subject to refund under
section 6413(c) of such Code with respect to wages (as defined
in section 3121 of such Code).'', and by striking ``wages
reported'' and all that follows through ``1954,'' and inserting
``wages reported to the Secretary of the Treasury or his
delegate pursuant to subtitle F of such Code,''.
(ii) The amendments made by clause (i) shall apply only
with respect to wages paid on or after January 1, 1993.
(C) Section 201(g)(4) of such Act (42 U.S.C. 401(g)(4)) is
amended--
(i) by striking ``The Board of Trustees shall
prescribe before January 1, 1981, the method'' and
inserting ``If at any time or times the Boards of
Trustees of such Trust Funds deem such action
advisable, they may modify the method prescribed by
such Boards'';
(ii) by striking ``1954'' and inserting ``1986'';
and
(iii) by striking the last sentence.
(3) Section 202(v) of such Act (42 U.S.C. 402(v)) is
amended--
(A) in paragraph (1), by striking ``1954'' and
inserting ``1986''; and
(B) in paragraph (3)(A), by inserting ``of the
Internal Revenue Code of 1986'' after ``3127''.
(4) Section 205(c)(5)(F)(i) of such Act (42 U.S.C.
405(c)(5)(F)(i)) is amended by inserting ``or the Internal
Revenue Code of 1986'' after ``1954''.
(5)(A) Section 208(a)(1) of such Act (42 U.S.C. 408(a)(1))
is amended--
(i) in the matter preceding subparagraph (A), by
striking ``subchapter E'' and all that follows through
``1954'' and inserting ``chapter 2 or 21 or subtitle F
of the Internal Revenue Code of 1986'';
(ii) in subparagraph (A), by inserting ``of 1986''
after ``Internal Revenue Code''; and
(iii) in subparagraph (B), by inserting ``of 1986''
after ``Internal Revenue Code''.
(B) The amendments made by subparagraph (A) shall apply
only with respect to violations occurring on or after the date
of the enactment of this Act.
(6)(A) Section 209(a)(4)(A) of such Act (42 U.S.C.
409(a)(4)(A)) is amended by inserting ``or the Internal Revenue
Code of 1986'' after ``Internal Revenue Code of 1954''.
(B) Section 209(a) of such Act (42 U.S.C. 409(a)) is
amended--
(i) in subparagraphs (C) and (E) of paragraph (4),
(ii) in paragraph (5)(A),
(iii) in subparagraphs (A) and (B) of paragraph
(14),
(iv) in paragraph (15),
(v) in paragraph (16), and
(vi) in paragraph (17),
by striking ``1954'' each place it appears and inserting
``1986''.
(C) Subsections (b), (f), (g), (i)(1), and (j) of section
209 of such Act (42 U.S.C. 409) are amended by striking
``1954'' each place it appears and inserting ``1986''.
(7) Section 211(a)(15) of such Act (42 U.S.C. 411(a)(15))
is amended by inserting ``of the Internal Revenue Code of
1986'' after ``section 162(m)''.
(8) Title II of such Act is further amended--
(A) in subsections (f)(5)(B)(ii) and (k) of section
203 (42 U.S.C. 403),
(B) in section 205(c)(1)(D)(i) (42 U.S.C.
405(c)(1)(D)(i)),
(C) in the matter in section 210(a) (42 U.S.C.
410(a)) preceding paragraph (1) and in paragraphs (8),
(9), and (10) of section 210(a),
(D) in subsections (p)(4) and (q) of section 210
(42 U.S.C. 410),
(E) in the matter in section 211(a) (42 U.S.C.
411(a)) preceding paragraph (1) and in paragraphs (3),
(4), (6), (10), (11), and (12) and clauses (iii) and
(iv) of section 211(a),
(F) in the matter in section 211(c) (42 U.S.C.
411(c)) preceding paragraph (1), in paragraphs (3) and
(6) of section 211(c), and in the matter following
paragraph (6) of section 211(c),
(G) in subsections (d), (e), and (h)(1)(B) of
section 211 (42 U.S.C. 411),
(H) in section 216(j) (42 U.S.C. 416(j)),
(I) in section 218(e)(3) (42 U.S.C. 418(e)(3)),
(J) in section 229(b) (42 U.S.C. 429(b)),
(K) in section 230(c) (42 U.S.C. 430(c)), and
(L) in section 232 (42 U.S.C. 432),
by striking ``1954'' each place it appears and inserting
``1986''.
(d) Rules of Construction.--
(1) The preceding provisions of this section shall be
construed only as technical and clerical corrections and as
reflecting the original intent of the provisions amended
thereby.
(2) Any reference in title II of the Social Security Act to
the Internal Revenue Code of 1986 shall be construed to include
a reference to the Internal Revenue Code of 1954 to the extent
necessary to carry out the provisions of paragraph (1).
(e) Utilization of National Average Wage Index for Wage-Based
Adjustments.--
(1) Definition of national average wage index.--Section
209(k) of the Social Security Act (42 U.S.C. 409(k)) is
amended--
(A) by redesignating paragraph (2) as paragraph
(3);
(B) in paragraph (3) (as redesignated), by striking
``paragraph (1)'' and inserting ``this subsection'';
and
(C) by striking paragraph (1) and inserting the
following new paragraphs:
``(k)(1) For purposes of sections 203(f)(8)(B)(ii), 213(d)(2)(B),
215(a)(1)(B)(ii), 215(a)(1)(C)(ii), 215(a)(1)(D), 215(b)(3)(A)(ii),
215(i)(1)(E), 215(i)(2)(C)(ii), 224(f)(2)(B), and 230(b)(2) (and
230(b)(2) as in effect immediately prior to the enactment of the Social
Security Amendments of 1977), the term `national average wage index'
for any particular calendar year means, subject to regulations of the
Secretary under paragraph (2), the average of the total wages for such
particular calendar year.
``(2) The Secretary shall prescribe regulations under which the
national average wage index for any calendar year shall be computed--
``(A) on the basis of amounts reported to the Secretary of
the Treasury or his delegate for such year,
``(B) by disregarding the limitation on wages specified in
subsection (a)(1),
``(C) with respect to calendar years after 1990, by
incorporating deferred compensation amounts and factoring in
for such years the rate of change from year to year in such
amounts, in a manner consistent with the requirements of
section 10208 of the Omnibus Budget Reconciliation Act of 1989,
and
``(D) with respect to calendar years before 1978, in a
manner consistent with the manner in which the average of the
total wages for each of such calendar years was determined as
provided by applicable law as in effect for such years.''.
(2) Conforming amendments.--
(A) Section 203(f)(8)(B)(ii) of such Act (42 U.S.C.
403(f)(8)(B)(ii)) is amended by striking ``deemed
average total wages'' each place it appears and
inserting ``national average wage index''.
(B) Section 213(d)(2)(B) of such Act (42 U.S.C.
413(d)(2)(B)) is amended by striking ``deemed average
total wages'' and inserting ``national average wage
index'', and by striking ``the average of the total
wages'' and all that follows and inserting ``the
national average wage index (as so defined) for
1976,''.
(C) Section 215(a)(1)(B)(ii) of such Act (42 U.S.C.
415(a)(1)(B)(ii)) is amended--
(i) in subclause (I), by striking ``deemed
average total wages'' and inserting ``national
average wage index''; and
(ii) in subclause (II), by striking ``the
average of the total wages'' and all that
follows and inserting ``the national average
wage index (as so defined) for 1977.''.
(D) Section 215(a)(1)(C)(ii) of such Act (42 U.S.C.
415(a)(1)(C)(ii)) is amended by striking ``deemed
average total wages'' and inserting ``national average
wage index''.
(E) Section 215(a)(1)(D) of such Act (42 U.S.C.
415(a)(1)(D)) is amended--
(i) by striking ``after 1978'';
(ii) by striking ``and the average of the
total wages (as described in subparagraph
(B)(ii)(I))'' and inserting ``and the national
average wage index (as defined in section
209(k)(1))''; and
(iii) by striking the last sentence.
(F) Section 215(b)(3)(A)(ii) of such Act (42 U.S.C.
415(b)(3)(A)(ii)) is amended by striking ``deemed
average total wages'' each place it appears and
inserting ``national average wage index''.
(G) Section 215(i)(1) of such Act (42 U.S.C.
415(i)(1)) is amended--
(i) in subparagraph (E), by striking ``SSA
average wage index'' and inserting ``national
average wage index (as defined in section
209(k)(1))''; and
(ii) by striking subparagraph (G) and
redesignating subparagraph (H) as subparagraph
(G).
(H) Section 215(i)(2)(C)(ii) of such Act (42 U.S.C.
415(i)(1)(C)(ii)) is amended to read as follows:
``(ii) The Secretary shall determine and promulgate the OASDI fund
ratio for the current calendar year on or before November 1 of the
current calendar year, based upon the most recent data then available.
The Secretary shall include a statement of the fund ratio and the
national average wage index (as defined in section 209(k)(1)) and a
statement of the effect such ratio and the level of such index may have
upon benefit increases under this subsection in any notification made
under clause (i) and any determination published under subparagraph
(D).''.
(I) Section 224(f)(2) of such Act (42 U.S.C.
424a(f)(2)) is amended--
(i) in subparagraph (A), by adding ``and''
at the end;
(ii) by striking subparagraph (C); and
(iii) by striking subparagraph (B) and
inserting the following:
``(B) the ratio of (i) the national average wage index (as
defined in section 209(k)(1)) for the calendar year before the
year in which such redetermination is made to (ii) the national
average wage index (as so defined) for the calendar year before
the year in which the reduction was first computed (but not
counting any reduction made in benefits for a previous period
of disability).''.
(J) Section 230(b)(2) of such Act (42 U.S.C.
430(b)(2)) is amended by striking ``deemed average
total wages'' each place it appears and inserting
``national average wage index''.
(K) Section 230(d) of such Act (42 U.S.C. 430(d))
is amended by striking ``deemed average total wage''
and inserting ``national average wage index''.
SEC. 13018. CROSS-MATCHING OF SOCIAL SECURITY ACCOUNT NUMBER
INFORMATION AND EMPLOYER IDENTIFICATION NUMBER
INFORMATION MAINTAINED BY THE DEPARTMENT OF AGRICULTURE.
(a) Social Security Account Number Information.--Clause (iii) of
section 205(c)(2)(C) of the Social Security Act (42 U.S.C.
405(c)(2)(C)) (as added by section 1735(a)(3) of the Food, Agriculture,
Conservation, and Trade Act of 1990 (Public Law 101-624; 104 Stat.
3791)) is amended--
(1) by inserting ``(I)'' after ``(iii)''; and
(2) by striking ``The Secretary of Agriculture shall
restrict'' and all that follows and inserting the following:
``(II) The Secretary of Agriculture may share any information
contained in any list referred to in subclause (I) with any other
agency or instrumentality of the United States which otherwise has
access to social security account numbers in accordance with this
subsection or other applicable Federal law, except that the Secretary
of Agriculture may share such information only to the extent that such
Secretary determines such sharing would assist in verifying and
matching such information against information maintained by such other
agency or instrumentality. Any such information shared pursuant to this
subclause may be used by such other agency or instrumentality only for
the purpose of effective administration and enforcement of the Food
Stamp Act of 1977 or for the purpose of investigation of violations of
other Federal laws or enforcement of such laws.
``(III) The Secretary of Agriculture, and the head of any other
agency or instrumentality referred to in this subclause, shall
restrict, to the satisfaction of the Secretary of Health and Human
Services, access to social security account numbers obtained pursuant
to this clause only to officers and employees of the United States
whose duties or responsibilities require access for the purposes
described in subclause (II).
``(IV) The Secretary of Agriculture, and the head of any agency or
instrumentality with which information is shared pursuant to clause
(II), shall provide such other safeguards as the Secretary of Health
and Human Services determines to be necessary or appropriate to protect
the confidentiality of the social security account numbers.''.
(b) Employer Identification Number Information.--Subsection (f) of
section 6109 of the Internal Revenue Code of 1986 (as added by section
1735(c) of the Food, Agriculture, Conservation, and Trade Act of 1990
(Public Law 101-624; 104 Stat. 3792)) (relating to access to employer
identification numbers by Secretary of Agriculture for purposes of Food
Stamp Act of 1977) is amended--
(1) by striking paragraph (2) and inserting the following:
``(2) Sharing of information and safeguards.--
``(A) Sharing of information.--The Secretary of
Agriculture may share any information contained in any
list referred to in paragraph (1) with any other agency
or instrumentality of the United States which otherwise
has access to employer identification numbers in
accordance with this section or other applicable
Federal law, except that the Secretary of Agriculture
may share such information only to the extent that such
Secretary determines such sharing would assist in
verifying and matching such information against
information maintained by such other agency or
instrumentality. Any such information shared pursuant
to this subparagraph may be used by such other agency
or instrumentality only for the purpose of effective
administration and enforcement of the Food Stamp Act of
1977 or for the purpose of investigation of violations
of other Federal laws or enforcement of such laws.
``(B) Safeguards.--The Secretary of Agriculture,
and the head of any other agency or instrumentality
referred to in subparagraph (A), shall restrict, to the
satisfaction of the Secretary of the Treasury, access
to employer identification numbers obtained pursuant to
this subsection only to officers and employees of the
United States whose duties or responsibilities require
access for the purposes described in subparagraph (A).
The Secretary of Agriculture, and the head of any
agency or instrumentality with which information is
shared pursuant to subparagraph (A), shall provide such
other safeguards as the Secretary of the Treasury
determines to be necessary or appropriate to protect
the confidentiality of the employer identification
numbers.'';
(2) in paragraph (3), by striking ``by the Secretary of
Agriculture pursuant to this subsection'' and inserting
``pursuant to this subsection by the Secretary of Agriculture
or the head of any agency or instrumentality with which
information is shared pursuant to paragraph (2)'', and by
striking ``social security account numbers'' and inserting
``employer identification numbers''; and
(3) in paragraph (4), by striking ``by the Secretary of
Agriculture pursuant to this subsection'' and inserting
``pursuant to this subsection by the Secretary of Agriculture
or any agency or instrumentality with which information is
shared pursuant to paragraph (2)''.
SEC. 13019. PROHIBITION OF MISUSE OF DEPARTMENT OF THE TREASURY NAMES,
SYMBOLS, ETC.
(a) General Rule.--Subchapter II of chapter 3 of title 31, United
States Code, is amended by adding at the end thereof the following new
section:
``Sec. 333. Prohibition of misuse of Department of the Treasury names,
symbols, etc.
``(a) General Rule.--No person may use, in connection with, or as a
part of, any advertisement, solicitation, business activity, or
product, whether alone or with other words, letters, symbols, or
emblems--
``(1) the words `Department of the Treasury', or the name
of any service, bureau, office, or other subdivision of the
Department of the Treasury,
``(2) the titles `Secretary of the Treasury' or `Treasurer
of the United States' or the title of any other officer or
employee of the Department of the Treasury,
``(3) the abbreviations or initials of any entity referred
to in paragraph (1),
``(4) the words `United States Savings Bond' or the name of
any other obligation issued by the Department of the Treasury,
``(5) any symbol or emblem of an entity referred to in
paragraph (1) (including the design of any envelope or
stationary used by such an entity), and
``(6) any colorable imitation of any such words, titles,
abbreviations, initials, symbols, or emblems,
in a manner which could reasonably be interpreted or construed as
conveying the false impression that such advertisement, solicitation,
business activity, or product is in any manner approved, endorsed,
sponsored, or authorized by, or associated with, the Department of the
Treasury or any entity referred to in paragraph (1) or any officer or
employee thereof.
``(b) Treatment of Disclaimers.--Any determination of whether a
person has violated the provisions of subsection (a) shall be made
without regard to any use of a disclaimer of affiliation with the
United States Government or any particular agency or instrumentality
thereof.
``(c) Civil Penalty.--
``(1) In general.--The Secretary of the Treasury may impose
a civil penalty on any person who violates the provisions of
subsection (a).
``(2) Amount of penalty.--The amount of the civil penalty
imposed by paragraph (1) shall not exceed $5,000 for each use
of any material in violation of subsection (a). If such use is
in a broadcast or telecast, the preceding sentence shall be
applied by substituting `$25,000' for `$5,000'.
``(3) Time limitations.--
``(A) Assessments.--The Secretary of the Treasury
may assess any civil penalty under paragraph (1) at any
time before the end of the 3-year period beginning on
the date of the violation with respect to which such
penalty is imposed.
``(B) Civil action.--The Secretary of the Treasury
may commence a civil action to recover any penalty
imposed under this subsection at any time before the
end of the 2-year period beginning on the date on which
such penalty was assessed.
``(4) Coordination with subsection (d).--No penalty may be
assessed under this subsection with respect to any violation
after a criminal proceeding with respect to such violation has
been commenced under subsection (d).
``(d) Criminal Penalty.--
``(1) In general.--If any person knowingly violates
subsection (a), such person shall, upon conviction thereof, be
fined not more than $10,000 for each such use or imprisoned not
more than 1 year, or both. If such use is in a broadcast or
telecast, the preceding sentence shall be applied by
substituting `$50,000' for `$10,000'.
``(2) Time limitations.--No person may be prosecuted,
tried, or punished under paragraph (1) for any violation of
subsection (a) unless the indictment is found or the
information instituted during the 3-year period beginning on
the date of the violation.
``(3) Coordination with subsection (c).--No criminal
proceeding may be commenced under this subsection with respect
to any violation if a civil penalty has previously been
assessed under subsection (c) with respect to such violation.''
(b) Clerical Amendment.--The analysis for chapter 3 of title 31,
United States Code, is amended by adding after the item relating to
section 332 the following new item:
``333. Prohibition of misuse of Department of the Treasury names,
symbols, etc.''.
(c) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act.
(d) Report.--Not later than May 1, 1995, the Secretary of the
Treasury shall submit a report to the Committee on Ways and Means of
the House of Representatives and the Committee on Finance of the Senate
on the implementation of the amendments made by this section. Such
report shall include the number of cases in which the Secretary has
notified persons of violations of section 333 of title 31, United
States Code (as added by subsection (a)), the number of prosecutions
commenced under such section, and the total amount of the penalties
collected in such prosecutions.
SEC. 13020. AVAILABILITY AND USE OF DEATH INFORMATION UNDER THE OLD-
AGE, SURVIVORS, AND DISABILITY INSURANCE PROGRAM.
(a) Improvements in Program for Use of Death Certificates to
Correct Program Information.--
(1) Elimination of state restrictions on use of
information.--Section 205(r)(1) of the Social Security Act (42
U.S.C. 405(r)(1)) is amended by adding at the end, after and
below subparagraph (B), the following new sentence:
``Any contract entered into pursuant to subparagraph (A) shall not
include any restriction on the use of information obtained by the
Secretary pursuant to such contract, except to the extent that such use
may be restricted under paragraph (6).''.
(2) Information provided to state agencies free of
charge.--
(A) In general.--Section 205(r)(4) of such Act (42
U.S.C. 405(r)(4)) is amended to read as follows:
``(4)(A) In the case of individuals with respect to whom federally
funded benefits are provided by (or through) a State agency other than
under this Act, the Secretary shall to the extent feasible provide such
information free of charge through a cooperative arrangement with such
agency, for ensuring proper payment of those benefits with respect to
such individuals, if such arrangement does not conflict with the duties
of the Secretary under paragraph (1).
``(B) The Secretary may enter into similar agreements with States
to provide information free of charge for their use in programs wholly
funded by the States if such arrangement does not conflict with the
duties of the Secretary under paragraph (1).''.
(B) Conforming amendment.--Section 205(r)(3) of
such Act (42 U.S.C. 405(r)(3)) is amended by striking
``or State''.
(3) Use by states of social security account numbers
contingent upon participation in program.--Section 205(r)(2) of
such Act (42 U.S.C. 405(r)(2)) is amended--
(A) by inserting ``(A)'' after ``(2)''; and
(B) by adding at the end the following new
subparagraph:
``(B) Notwithstanding section 7(a)(2)(B) of the Privacy Act of 1974
and clauses (i) and (v) of subsection (c)(2)(C) of this section, any
State which is not a party to a contract with the Secretary meeting the
requirements of paragraph (1) (and any political subdivision thereof)
may not utilize an individual's social security account number in the
administration of any driver's license or motor vehicle registration
law.''.
(b) Study Regarding Improvements in Gathering and Reporting of
Death Information.
(1) In general.--As soon as practicable after the date of
the enactment of this Act, the Secretary of Health and Human
Services shall conduct a study of possible improvements in the
current methods of gathering and reporting death information by
the Federal, State, and local governments which would result in
more efficient and expeditious handling of such information.
(2) Specific matters to be studied.--In carrying out the
study required under this subsection, the Secretary shall--
(A) ascertain the delays in the receipt of death
information which are currently encountered by the
Social Security Administration and other agencies in
need of such information on a regular basis,
(B) analyze the causes of such delays,
(C) develop alternative options for improving
Federal, State, and local agency cooperation in
reducing such delays, and
(D) evaluate the costs and benefits associated with
the options referred to in subparagraph (C).
(3) Report.--Not later than June 1, 1994, the Secretary
shall submit a written report to the Committee on Ways and
Means of the House of Representatives and the Committee on
Finance of the Senate setting forth the results of the study
conducted pursuant to this subsection, together with such
administrative and legislative recommendations as the Secretary
may consider appropriate.
(c) Effective Date.--
(1) In general.--The amendments made by subsection (a)
shall take effect 1 year after the date of the enactment of
this Act.
(2) Promotion of entry into new contracts.--As soon as
practicable after the date of the enactment of this Act, the
Secretary of Health and Human Services shall take such actions
as are necessary and appropriate to promote entry into
contracts under section 205(r) of the Social Security Act which
are in compliance with the requirements of the amendments made
by subsection (a).
Subtitle B--Human Resources Amendments
SEC. 13201. TABLE OF CONTENTS.
The table of contents of this subtitle is as follows:
Subtitle B--Human Resources Amendments
Sec. 13201. Table of contents.
Sec. 13202. References.
Chapter 1--Child Welfare Services, Foster Care, and Adoption Assistance
Sec. 13211. Entitlement funding for services designed to strengthen and
preserve families.
Sec. 13212. Grants for State courts to assess and improve handling of
proceedings relating to foster care and
adoption.
Sec. 13213. Required protections for foster children.
Sec. 13214. States required to report on measures taken to comply with
the Indian Child Welfare Act.
Sec. 13215. Child welfare traineeships.
Sec. 13216. Dissolved adoptions.
Sec. 13217. Time frame for judicial determinations on voluntary
placements.
Sec. 13218. Study of reasonable efforts.
Sec. 13219. Enhanced match for automated data systems.
Sec. 13220. Periodic reevaluation of foster care maintenance payments.
Sec. 13221. Dispositional hearing.
Sec. 13222. Health care plans for foster children.
Sec. 13223. Independent living.
Sec. 13224. Elimination of foster care ceilings and of authority to
transfer unused foster care funds to child
welfare services programs.
Sec. 13225. Training of agency staff and foster and adoptive parents.
Sec. 13226. On-site reviews and audits of State claims for foster care
and adoption assistance.
Sec. 13227. Conformity reviews.
Sec. 13228. Repeal of annual report on voluntary placement.
Sec. 13229. Demonstration projects.
Sec. 13230. Placement accountability.
Sec. 13231. Payments of State claims for foster care and adoption
assistance.
Sec. 13232. Moratorium on collection of disallowances.
Sec. 13233. Border region child welfare worker training demonstration.
Sec. 13234. Effect of failure to carry out State plan.
Chapter 2--Child Support Enforcement
Sec. 13241. State paternity establishment programs.
Sec. 13242. Enforcement of health insurance support.
Sec. 13243. Reports to credit bureaus on persons delinquent in child
support payments.
Chapter 3--Supplemental Security Income
Sec. 13251. Fees for Federal administration of State supplementary
payments.
Sec. 13252. Exclusion from income of State relocation assistance.
Sec. 13253. Prevention of adverse effects on eligibility for, and
amount of, benefits when spouse or parent
of beneficiary is absent from the household
due to active military service.
Sec. 13254. Eligibility for children of Armed Forces personnel residing
outside the United States other than in
foreign countries.
Sec. 13255. Definition of disability for children under age 18 applied
to all individuals under age 18.
Sec. 13256. Valuation of certain in-kind support and maintenance when
there is a cost of living adjustment in
benefits.
Sec. 13257. Exclusion from income of certain amounts received by
Indians from interests held in trust.
Chapter 4--Aid To Families With Dependent Children
Sec. 13261. 50 percent Federal match of State administrative costs.
Sec. 13262. Delay in effective date of penalty for failure to meet
required participation rate for unemployed
parents in the JOBS program.
Sec. 13263. Report to the Congress with respect to performance
standards in the JOBS program.
Sec. 13264. Measurement and reporting of welfare participation.
Sec. 13265. New Hope demonstration project.
Sec. 13266. Delay in requirement that outlying areas operate an AFDC-UP
program.
Sec. 13267. Adult in family or household allowed to attest to
citizenship status of family or household
members.
Sec. 13268. Increase in stepparent income disregard.
Sec. 13269. Extension of New York State child support demonstration
program.
Sec. 13270. Early childhood development projects.
Chapter 5--Unemployment Insurance
Sec. 13271. Treatment of short-time compensation programs.
Sec. 13272. Technical amendment to Unemployment Trust Fund.
Sec. 13273. Extension of reporting date for advisory council.
Sec. 13274. Clarification of emergency unemployment benefits
provisions.
Sec. 13275. Modifications to extended unemployment program.
Sec. 13276. Extension of current Federal unemployment rate.
Sec. 13277. Disclosure of information to Railroad Retirement Board.
Chapter 6--Technical Provisions
Sec. 13281. Corrections related to the income security and human
resources provisions of the Omnibus Budget
Reconciliation Act of 1990.
Sec. 13282. Technical corrections related to the human resource and
income security provisions of the Omnibus
Budget Reconciliation Act of 1989.
Sec. 13283. Elimination of obsolete provisions relating to treatment of
the earned income tax credit.
Sec. 13284. Redesignation of certain provisions.
SEC. 13202. REFERENCES.
Except as otherwise expressly provided, wherever in this subtitle
an amendment or repeal is expressed in terms of an amendment to, or
repeal of, a section or other provision, the reference shall be
considered to be made to a section or other provision of the Social
Security Act.
CHAPTER 1--CHILD WELFARE SERVICES, FOSTER CARE, AND ADOPTION ASSISTANCE
SEC. 13211. ENTITLEMENT FUNDING FOR SERVICES DESIGNED TO STRENGTHEN AND
PRESERVE FAMILIES.
(a) In General.--Part B of title IV (42 U.S.C. 620-628) is
amended--
(1) by striking the heading and inserting the following:
``PART B--CHILD AND FAMILY SERVICES
``Subpart 1--Child Welfare Services''; and
(2) by adding at the end the following:
``Subpart 2--Family Preservation and Support Services
``SEC. 430. PURPOSES; LIMITATIONS ON AUTHORIZATIONS OF APPROPRIATIONS;
RESERVATION OF CERTAIN AMOUNTS.
``(a) Purposes; Limitations on Authorization of Appropriations.--
For the purpose of encouraging and enabling each State to develop and
establish, or expand, and to operate a program of family preservation
services and community-based family support services, there are
authorized to be appropriated to the Secretary--
``(1) $60,000,000 for fiscal year 1994;
``(2) $135,000,000 for fiscal year 1995;
``(3) $240,000,000 for fiscal year 1996;
``(4) $360,000,000 for fiscal year 1997; and
``(5) $600,000,000 for fiscal year 1998.
``(b) Reservation of Certain Amounts.--
``(1) Evaluation, research, training, and technical
assistance.--The Secretary shall reserve 1 percent of the
amount appropriated pursuant to subsection (a) for each fiscal
year, for expenditure by the Secretary for evaluation,
research, training, and technical assistance related to the
program under this subpart.
``(2) State court assessments.--The Secretary shall reserve
$5,000,000 of the amount appropriated pursuant to subsection
(a) for fiscal year 1995, and $10,000,000 of the amount so
appropriated for each of fiscal years 1996, 1997, and 1998, for
grants under section 13212 of the Omnibus Budget Reconciliation
Act of 1993.
``(3) Indian tribes.--The Secretary shall reserve 1 percent
of the amount appropriated pursuant to subsection (a) for each
fiscal year, for allotment to Indian tribes in accordance with
section 433(a).
``SEC. 431. DEFINITIONS.
``(a) In General.--As used in this subpart:
``(1) Family preservation services.--The term `family
preservation services' means services for children and families
designed to help families (including adoptive and extended
families) at risk or in crisis, including--
``(A) service programs designed to help children--
``(i) where appropriate, return to families
from which they have been removed; or
``(ii) be placed for adoption, with a legal
guardian, or, if adoption or legal guardianship
is determined not to be appropriate for a
child, in some other planned, permanent living
arrangement;
``(B) preplacement preventive services programs,
such as intensive family preservation programs,
designed to help children at risk of foster care
placement remain with their families;
``(C) service programs designed to provide followup
care to families to whom a child has been returned
after a foster care placement;
``(D) respite care of children to provide temporary
relief for parents and other caregivers (including
foster parents); and
``(E) services designed to improve parenting skills
(by reinforcing parents' confidence in their strengths,
and helping them to identify where improvement is
needed and to obtain assistance in improving those
skills) with respect to matters such as child
development, family budgeting, coping with stress,
health, and nutrition.
``(2) Family support services.--The term `family support
services' means community-based services to promote the well-
being of children and families designed to increase the
strength and stability of families (including adoptive, foster,
and extended families), to increase parents' confidence and
competence in their parenting abilities, to afford children a
stable and supportive family environment, and otherwise to
enhance child development, including--
``(A) services described in paragraph (1)(E);
``(B) respite care of children to provide temporary
relief for parents and other caregivers;
``(C) structured activities involving parents and
children to strengthen the parent-child relationship;
``(D) drop-in centers to afford families
opportunities for informal interaction with other
families and with program staff;
``(E) information and referral services to afford
families access to other community services, including
child care, health care, nutrition programs, adult
education and literacy programs, and counseling and
mentoring services; and
``(F) early developmental screening of children to
assess the needs of such children, and assistance to
families in securing specific services to meet these
needs.
``(3) State agency.--The term `State agency' means the
State agency responsible for administering the program under
subpart 1.
``(4) State.--The term `State' includes an Indian tribe or
tribal organization, in addition to the meaning given such term
for purposes of subpart 1.
``(5) Tribal organization.--The term `tribal organization'
means the recognized governing body of any Indian tribe.
``(6) Indian tribe.--The term `Indian tribe' means any
Indian tribe (as defined in section 482(i)(5)) and any Alaska
Native organization (as defined in section 482(i)(7)(A)).
``(b) Other Terms.--For other definitions of other terms used in
this subpart, see section 475.
``SEC. 432. STATE PLANS.
``(a) Plan Requirements.--A State plan meets the requirements of
this subsection if the plan--
``(1) provides that the State agency shall administer, or
supervise the administration of, the State program under this
subpart;
``(2)(A)(i) sets forth the goals intended to be
accomplished under the plan by the end of the 5th fiscal year
in which the plan is in operation in the State, and (ii) is
updated periodically to set forth the goals intended to be
accomplished under the plan by the end of each 5th fiscal year
thereafter;
``(B) describes the methods to be used in measuring
progress toward accomplishment of the goals;
``(C) contains a commitment that the State--
``(i) after the end of each of the 1st 4 fiscal
years covered by a set of goals, will perform an
interim review of progress toward accomplishment of the
goals, and on the basis of the interim review will
revise the statement of goals in the plan, if
necessary, to reflect changed circumstances; and
``(ii) after the end of the last fiscal year
covered by a set of goals, will perform a final review
of progress toward accomplishment of the goals, and on
the basis of the final review (I) will prepare,
transmit to the Secretary, and make available to the
public a final report on progress toward accomplishment
of the goals, and (II) will develop (in consultation
with the entities required to be consulted pursuant to
subsection (b)) and add to the plan a statement of the
goals intended to be accomplished by the end of the 5th
succeeding fiscal year;
``(3) provides for coordination, to the extent feasible and
appropriate, of the provision of services under the plan and
the provision of services or benefits under other Federal or
federally assisted programs serving the same populations;
``(4) contains assurances that not less than 90 percent of
expenditures under the plan for any fiscal year with respect to
which the State is eligible for payment under section 433 for
the fiscal year shall be for services for children and
families, and that significant portions of such 90 percent
shall be expended--
``(A) for family preservation services; and
``(B) for community-based family support services;
``(5) provides that, by the beginning of the 6th fiscal
year during which the plan is in effect, programs under the
plan shall be available on a statewide basis, to the extent
feasible and appropriate;
``(6) contains assurances that the State will--
``(A) annually prepare, furnish to the Secretary,
and make available to the public a description
(including separate descriptions with respect to family
preservation services and community-based family
support services) of--
``(i) the service programs to be made
available under the plan in the immediately
succeeding fiscal year;
``(ii) the populations which the programs
will serve; and
``(iii) the geographic areas in the State
in which the services will be available; and
``(B) perform the activities described in
subparagraph (A)--
``(i) in the case of the 1st fiscal year
under the plan, at the time the State submits
its initial plan; and
``(ii) in the case of each succeeding
fiscal year, by the end of the 3rd quarter of
the immediately preceding fiscal year;
``(7) provides for such methods of administration as the
Secretary finds to be necessary for the proper and efficient
operation of the plan;
``(8)(A) contains assurances that Federal funds provided to
the State under this subpart will not be used to supplant
Federal or non-Federal funds for existing services and
activities which promote the purposes of this subpart; and
``(B) provides that the State will furnish reports to the
Secretary, at such times, in such format, and containing such
information as the Secretary may require, that demonstrate the
State's compliance with the prohibition contained in
subparagraph (A); and
``(9) provides that the State agency will furnish such
reports, containing such information, and participate in such
evaluations, as the Secretary may require.
``(b) Approval of Plans.--
``(1) In general.--The Secretary shall approve a plan that
meets the requirements of subsection (a) only if the plan was
developed jointly by the Secretary and the State, after
consultation by the State agency with appropriate public and
nonprofit private agencies and community-based organizations
with experience in administering programs of services for
children and families (including family preservation and family
support services).
``(2) Plans of indian tribes exempted from inappropriate
requirements.--The Secretary may exempt a plan submitted by an
Indian tribe from any requirement of this section that the
Secretary determines would be inappropriate to apply to the
Indian tribe, taking into account the resources, needs, and
other circumstances of the Indian tribe.
``SEC. 433. ALLOTMENTS TO STATES.
``(a) Indian Tribes.--
``(1) In general.--From the amount reserved pursuant to
section 430(b)(3), the Secretary shall allot to each Indian
tribe with a plan approved under this subpart (except as
provided in paragraph (2) of this subsection) an amount that
bears the same ratio to such reserved amount as the number of
children in the Indian tribe bears to the total number of
children in all Indian tribes with State plans so approved, as
determined by the Secretary on the basis of the most current
and reliable information available to the Secretary.
``(2) Special rule.--The Secretary may not allot funds to
an Indian tribe with a plan approved under this subpart whose
allotment (but for this paragraph) would be less than $10,000
if allotments were made under paragraph (1) to all Indian
tribes with plans approved under this subpart with the same or
larger numbers of children.
``(b) Territories.--From the amount appropriated pursuant to
section 430 that remains after applying section 430(b) for each fiscal
year, the Secretary shall allot to each of the jurisdictions of Puerto
Rico, Guam, the Virgin Islands, the Northern Mariana Islands, and
American Samoa an amount determined in the same manner as the allotment
to each of such jurisdictions is determined under section 421.
``(c) Other States.--
``(1) In general.--From the amount appropriated pursuant to
section 430 that remains after applying section 430(b) and
subsection (b) of this section for each fiscal year, the
Secretary shall allot to each State (other than an Indian
tribe) which is not specified in subsection (b) of this section
an amount equal to such remaining amount multiplied by the food
stamp percentage of the State for the fiscal year.
``(2) Food stamp percentage defined.--
``(A) In general.--As used in paragraph (1) of this
subsection, the term `food stamp percentage' means,
with respect to a State and a fiscal year, the average
monthly number of children receiving food stamp
benefits in the State for months in the 3 fiscal years
referred to in subparagraph (B) of this paragraph, as
determined from sample surveys made under section 16(c)
of the Food Stamp Act of 1977, expressed as a
percentage of the average monthly number of children
receiving food stamp benefits in the States described
in such paragraph (1) for months in such 3 fiscal
years, as so determined.
``(B) Fiscal years used in calculation.--For
purposes of the calculation pursuant to subparagraph
(A), the Secretary shall use data for the 3 most recent
fiscal years, preceding the fiscal year for which the
State's allotment is calculated under this subsection,
for which such data are available to the Secretary.
``SEC. 434. PAYMENTS TO STATES.
``(a) Entitlement.--
``(1) General rule.--Except as provided in paragraph (2) of
this subsection, each State which has a plan approved under
this subpart shall be entitled to payment of the lesser of--
``(A) 75 percent of the total cost of activities
under the plan during the fiscal year or the
immediately succeeding fiscal year; or
``(B) the allotment of the State under section 433
for the fiscal year.
``(2) Special rule.--Upon submission by a State to the
Secretary during fiscal year 1994 of an application in such
form and containing such information as the Secretary may
require (including, if the State is seeking payment of an
amount pursuant to subparagraph (B) of this paragraph, a
description of the services to be provided with the amount),
the State shall be entitled to payment of an amount equal to
the sum of--
``(A) such amount not exceeding $1,000,000 as the
State may require to develop and submit a plan for
approval under section 432; and
``(B) an amount equal to the lesser of--
``(i) 75 percent of the cost of State
services to children and families provided in
accordance with section 432(a)(4); or
``(ii) the allotment of the State under
section 433 for fiscal year 1994, reduced by
any amount paid to the State pursuant to
subparagraph (A) of this paragraph.
``(b) Prohibitions.--
``(1) No use of other federal funds for state match.--Each
State receiving an amount paid under paragraph (1) or (2)(B) of
subsection (a) may not expend any Federal funds to meet the
costs of services described in this subpart not covered by the
amount so paid.
``(2) Availability of funds.--
``(A) In general.--A State may not expend any
amount paid under subsection (a)(1) for any fiscal year
after the end of the immediately succeeding fiscal
year.
``(B) Plan development.--A State may not expend any
amount paid under subsection (a)(2) after the end of
fiscal year 1994.
``(c) Direct Payments to Tribal Organizations of Indian Tribes.--
The Secretary shall pay any amount to which an Indian tribe is entitled
under this section directly to the tribal organization of the Indian
tribe.
``SEC. 435. EVALUATIONS; REPORT.
``(a) Evaluations.--
``(1) In general.--The Secretary shall evaluate the
effectiveness of the programs carried out pursuant to this
subpart in accomplishing the purposes of this subpart, in
accordance with criteria established in accordance with
paragraph (2).
``(2) Criteria to be used.--In developing the criteria to
be used in evaluations under paragraph (1), the Secretary shall
consult with appropriate parties, such as--
``(A) State agencies administering programs under
this part and part E;
``(B) persons administering child and family
services programs (including family preservation and
family support programs) for private, nonprofit
organizations with an interest in child welfare; and
``(C) other persons with recognized expertise in
the evaluation of child and family services programs
(including family preservation and family support
programs) or other related programs.
``(b) Report to the Congress.--Not later than December 31, 1997,
the Secretary shall submit to the Congress a report containing findings
with respect to the evaluations required by subsection (a).
``(c) Coordination of Evaluations.--The Secretary shall develop
procedures to coordinate evaluations under this section, to the extent
feasible, with evaluations by the States of the effectiveness of
programs under this subpart.''.
(b) Conforming Amendments.--
(1) Section 422 (42 U.S.C. 622) is amended--
(A) in subsection (a), by striking ``this part''
and inserting ``this subpart'';
(B) in subsection (b), by striking ``this part''
each place such term appears and inserting ``this
subpart''; and
(C) in subsection (b)(2), by inserting ``under the
State plan approved under subpart 2 of this part,''
after ``part A of this title,''.
(2) Section 423(a) (42 U.S.C. 623(a)) is amended by
striking ``this part'' and inserting ``this subpart''.
(3) Section 428(a) (42 U.S.C. 628(a)) is amended by
striking ``this part'' each place such term appears and
inserting ``this subpart''.
(4) Section 471(a)(2) (42 U.S.C. 671(a)(2)) is amended by
inserting ``subpart 1 of'' before ``part B''.
(c) Effective Date.--The amendments made by this section shall be
effective with respect to calendar quarters beginning on or after
October 1, 1993.
SEC. 13212. GRANTS FOR STATE COURTS TO ASSESS AND IMPROVE HANDLING OF
PROCEEDINGS RELATING TO FOSTER CARE AND ADOPTION.
(a) In General.--The Secretary shall make grants, in accordance
with this section, to the highest State courts in States participating
in the program under part E of title IV of the Social Security Act, for
the purpose of enabling such courts--
(1) to conduct assessments, in accordance with subsection
(b), of the role, responsibilities, and effectiveness of State
courts in carrying out State laws requiring proceedings
(conducted by or under the supervision of the courts)--
(A) to determine the advisability or
appropriateness of foster care placement;
(B) to determine whether to terminate parental
rights; and
(C) to legally recognize the adoption of a child;
and
(2) to implement changes deemed necessary as a result of
the assessments.
(b) Assessments.--Each assessment conducted with funds provided
under this section shall--
(1) identify the requirements imposed on State courts with
respect to proceedings described in subsection (a), addressing
separately--
(A) rules, standards, and criteria imposed pursuant
to State laws (including laws implementing parts B and
E of title IV of the Social Security Act, laws relating
to child abuse and neglect, or any other laws on
related matters) to be applied in determinations with
respect to placement of a child, or with respect to
related matters concerning the parent-child
relationship and the welfare of the child, including
determinations--
(i) whether to remove a child from or
return a child to the home of the child;
(ii) whether to place a child in foster
care or to continue a foster care placement;
(iii) whether to terminate parental rights;
(iv) whether to place a child for adoption
or in another permanent arrangement; and
(v) whether to set aside or to finalize an
adoption; and
(B) rules and procedures, established by or under
State law or adopted by the State court system on its
own initiative, with respect to the conduct of such
proceedings, that address matters such as--
(i) whether a proceeding should be judicial
or administrative;
(ii) timetables for such proceedings, and
determinations of the priority of such
proceedings relative to other matters under the
jurisdiction of the State courts;
(iii) procedural safeguards of the rights
of parents (including foster and adoptive
parents), guardians, and children, such as
provisions for legal representation and for
guardians ad litem; and
(iv) rules for conduct of the proceeding
with respect to matters such as admissible
evidence, opportunity to present witnesses, and
time limits on the presentation of evidence and
the making of arguments;
(2) evaluate the performance of the State courts in
implementing the requirements identified under paragraph (1),
by assessing--
(A) the extent to which particular practices or
procedures have been successful in facilitating
compliance with such requirements;
(B) the frequency of failures to comply with any
such requirements, and patterns with respect to the
circumstances of and factors contributing to the
failures; and
(C) the extent to which caseload size and resource
limitations contribute to the failures identified
pursuant to subparagraph (B);
(3) determine the extent to which the rules and practices
identified under paragraph (1) or (2) are in accord with
recommended standards of national organizations concerned with
permanent placement for foster children;
(4) determine, from the standpoint of the State courts, the
extent to which particular requirements under paragraph (1)--
(A) are facilitating or impeding achievement of the
purposes of such parts B and E, including the goal of
appropriate permanent placement for each child; and
(B) are imposing significant administrative burdens
on the State court system; and
(5) make specific recommendations for improvement, based on
the conclusions reached as a result of activities described in
paragraphs (1) through (4), including recommendations for--
(A) changes in Federal or State laws, regulations,
or policies;
(B) changes in procedures and practices of the
State courts and of the State agencies administering
foster care, adoption, child welfare, and child
protective services programs;
(C) additional education or training of State court
judges, or of personnel of the judicial system or of
the State agencies described in subparagraph (B);
(D) collection or dissemination of additional data
or information for purposes of increasing the
understanding of personnel of State courts and State
agencies of matters relating to case review proceedings
in general, or to specific case review proceedings; and
(E) increases in manpower, reductions in the number
of case reviews, or other changes needed to enable the
State courts to better manage their caseloads with
respect to such proceedings.
(c) Applications.--In order to be eligible for a grant under this
section, a highest State court shall submit to the Secretary, at such
time and in such form as the Secretary may require, an application
containing--
(1) a timetable for conducting and completing the
assessment;
(2) a budget for the assessment;
(3) a description of the methods to be used to select State
courts for inclusion in, and to conduct, the assessment;
(4) certifications by the head of the State agency
administering the State program under such part E, and by the
State foster care citizen review board or State organization of
such review boards (if any), that such entities have had an
opportunity to review and comment on a draft of the application
before its submission, and a copy of such comments;
(5) a description of the process to be used by the court to
consult with the entities referred to in paragraph (4) of this
subsection in conducting the assessment under subsection (b);
(6) an assurance that, to the extent funds provided under
this section are not necessary to complete the assessment under
subsection (b), the court will use such funds to implement, to
the extent feasible, recommendations made pursuant to
subsection (b)(5);
(7) an assurance that funds provided under this section
will not be used to supplant State or local funds which would
otherwise be used for similar purposes;
(8) a commitment to furnish to the Secretary--
(A) an interim report following the end of the 2nd
year of assessment activities under this section; and
(B) a final report following the completion of the
assessment; and
(9) any other information the Secretary may require.
(d) Allotments.--
(1) In general.--Each highest State court which has an
application approved under subsection (c), and is conducting
assessment activities in accordance with this section, shall be
entitled to payment, for each of fiscal years 1995 through
1998, from amounts reserved pursuant to section 430(b)(2) of
the Social Security Act, of an amount equal to the sum of--
(A) for fiscal year 1995, $75,000 plus the amount
described in paragraph (2) for fiscal year 1995; and
(B) for each of fiscal years 1996 through 1998,
$85,000 plus the amount described in paragraph (2) for
each of such fiscal years.
(2) Formula.--The amount described in this paragraph for
any fiscal year is the amount that bears the same ratio to the
amount reserved pursuant to section 430(b)(2) of the Social
Security Act for the fiscal year (reduced by the dollar amount
specified in paragraph (1) of this subsection for the fiscal
year) as the number of individuals in the State who have not
attained 21 years of age bears to the total number of such
individuals in all States the highest State courts of which
have approved applications under subsection (c).
(e) Use of Grant Funds.--Each highest State court which receives
funds paid under this section may use such funds to pay--
(1) any or all costs of activities under this section in
fiscal year 1995; and
(2) not more than 75 percent of the cost of activities
under this section in each of fiscal years 1996, 1997, and
1998.
SEC. 13213. REQUIRED PROTECTIONS FOR FOSTER CHILDREN.
(a) In General.--Section 422(b) (42 U.S.C. 622(b)) is amended--
(1) by striking ``and'' at the end of paragraph (7);
(2) by striking the period at the end of paragraph (8) and
inserting ``; and''; and
(3) by adding at the end the following:
``(9) provide assurances that the State--
``(A) since June 17, 1980, has completed an
inventory of all children who, before the inventory,
had been in foster care under the responsibility of the
State for 6 months or more, which determined--
``(i) the appropriateness of, and necessity
for, the foster care placement;
``(ii) whether the child could or should be
returned to the parents of the child or should
be freed for adoption or other permanent
placement; and
``(iii) the services necessary to
facilitate the return of the child or the
placement of the child for adoption or legal
guardianship;
``(B) is operating, to the satisfaction of the
Secretary--
``(i) a statewide information system from
which can be readily determined the status,
demographic characteristics, location, and
goals for the placement of every child who is
(or, within the immediately preceding 12
months, has been) in foster care;
``(ii) a case review system (as defined in
section 475(5)) for each child receiving foster
care under the supervision of the State;
``(iii) a service program designed to help
children--
``(I) where appropriate, return to
families from which they have been
removed; or
``(II) be placed for adoption, with
a legal guardian, or, if adoption or
legal guardianship is determined not to
be appropriate for a child, in some
other planned, permanent living
arrangement; and
``(iv) a preplacement preventive services
program designed to help children at risk of
foster care placement remain with their
families; and
``(C)(i) has reviewed (or within 12 months after
the date of the enactment of this paragraph will
review) State laws and administrative and judicial
procedures in effect for children abandoned at or
shortly after birth (including laws and procedures
providing for legal representation of such children);
and
``(ii) has enacted and is implementing (or within
24 months after the date of the enactment of this
paragraph will enact and implement) such laws and
procedures as the State determines, on the basis of the
review described in clause (i), to be necessary to
enable permanent decisions to be made expeditiously
with respect to the placement of such children.''.
(b) Restriction on Reallotment.--Section 424 (42 U.S.C. 624) is
amended--
(1) in the 1st sentence, by striking ``The amount'' and
inserting the following:
``(a) In General.--Subject to subsection (b), the amount''; and
(2) by adding at the end the following:
``(b) Exception Relating to Foster Child Protections.--The
Secretary shall not reallot under subsection (a) of this section any
amount that is withheld or recovered from a State due to the failure of
the State to comply with section 422(b)(9).''.
(c) Repeal.--Section 427 (42 U.S.C. 627) is hereby repealed.
(d) Conforming Amendments.--
(1) Section 423(a) (42 U.S.C. 623(a)) is amended by
striking ``and in section 427''.
(2) Section 425(a)(2) (42 U.S.C. 625(a)(2)) is amended by
striking ``the statistical report required by section'' and
inserting ``with section 422(b)(9) or''.
(3) Section 472(d) (42 U.S.C. 672(d)) is amended by
striking ``427(b)'' and inserting ``422(b)(9)''.
(e) Effective Date.--The amendments and repeal made by this section
shall be effective for fiscal years beginning on or after October 1,
1994.
(f) Construction of Section.--This section and the amendments and
repeal made by this section shall not be construed to permit any State
to interrupt the provision of the foster care protections described in
section 427 of the Social Security Act, as in effect on the effective
date of such amendments and repeal.
SEC. 13214. STATES REQUIRED TO REPORT ON MEASURES TAKEN TO COMPLY WITH
THE INDIAN CHILD WELFARE ACT.
(a) State Plan Requirement.--Section 422(b) (42 U.S.C. 622(b)), as
amended by section 13213(a) of this Act, is amended--
(1) by striking ``and'' at the end of paragraph (8);
(2) by striking the period at the end of paragraph (9) and
inserting ``; and''; and
(3) by adding at the end the following:
``(10) contain a description, developed after consultation
with tribal organizations (as defined in section 4 of the
Indian Self-Determination and Education Assistance Act) in the
State, of the specific measures taken by the State to comply
with the Indian Child Welfare Act.''.
(b) Effective Date.--The amendments made by subsection (a) shall be
effective with respect to calendar quarters beginning on or after
October 1, 1994.
SEC. 13215. CHILD WELFARE TRAINEESHIPS.
(a) In General.--Part B of title IV (42 U.S.C. 620-628) is amended
by inserting after section 428 the following:
``SEC. 429. CHILD WELFARE TRAINEESHIPS.
``The Secretary may approve an application for a grant to a public
or nonprofit institution for higher learning to provide traineeships
with stipends under section 426(a)(1)(C) only if the application--
``(1) provides assurances that each individual who receives
a stipend with such traineeship (in this section referred to as
a `recipient') will enter into an agreement with the
institution under which the recipient agrees--
``(A) to participate in training at a public or
private nonprofit child welfare agency on a regular
basis (as determined by the Secretary) for the period
of the traineeship;
``(B) to be employed for a period of years
equivalent to the period of the traineeship, in a
public or private nonprofit child welfare agency in any
State, within a period of time (determined by the
Secretary in accordance with regulations) after
completing the postsecondary education for which the
traineeship was awarded;
``(C) to furnish to the institution and the
Secretary evidence of compliance with subparagraphs (A)
and (B); and
``(D) if the recipient fails to comply with
subparagraph (A) or (B) and does not qualify for any
exception to this subparagraph which the Secretary may
prescribe in regulations, to repay to the Secretary all
(or an appropriately prorated part) of the amount of
the stipend, plus interest, and, if applicable,
reasonable collection fees (in accordance with
regulations promulgated by the Secretary);
``(2) provides assurances that the institution will--
``(A) enter into agreements with child welfare
agencies for onsite training of recipients;
``(B) permit an individual who is employed in the
field of child welfare services to apply for a
traineeship with a stipend if the traineeship furthers
the progress of the individual toward the completion of
degree requirements; and
``(C) develop and implement a system that, for the
3-year period that begins on the date any student
completes a child welfare services program of study,
tracks the employment record of the student, for the
purpose of determining the percentage of students who
secure employment in the field of child welfare
services and remain employed in the field.''.
(b) Conforming Amendment.--Section 426(a)(1)(C) (42 U.S.C.
626(a)(1)(C)) is amended by inserting ``described in section 429''
after ``including traineeships''.
(c) Applicability.--The amendments made by this section shall apply
to grants awarded on or after April 1, 1994.
SEC. 13216. DISSOLVED ADOPTIONS.
(a) Eligibility for Foster Care Maintenance Payments.--Section 472
(42 U.S.C. 672) is amended--
(1) in subsection (b), by inserting ``or (i)'' after
``subsection (a)''; and
(2) by adding at the end the following:
``(i) Any State with a plan approved under this part may make
foster care maintenance payments under this part on behalf of a child--
``(1) with respect to whom such payments were previously
made;
``(2) whose adoption has been set aside by a court;
``(3) who meets the requirements of paragraphs (1), (2),
and (3) of subsection (a); and
``(4) who fails to meet the requirements of subsection
(a)(4) but would meet such requirements if--
``(A) the child were treated as if the child were
in the same financial and other circumstances the child
was in the last time the child was determined eligible
for such payments; and
``(B) the adoption were treated as having never
occurred.''.
(b) Effective Date.--The amendments made by this section shall
apply to payments under part E of title IV of the Social Security Act
in fiscal years beginning on or after October 1, 1995.
SEC. 13217. TIME FRAME FOR JUDICIAL DETERMINATIONS ON VOLUNTARY
PLACEMENTS.
(a) In General.--Section 472(e) (42 U.S.C. 672(e)) is amended--
(1) by striking ``No'' and inserting ``(1) Except as
provided in paragraph (2), no''; and
(2) by adding at the end the following:
``(2) If the judicial determination referred to in
paragraph (1) is made after the 180-day period described
therein, the payments referred to therein may not be made for
the period that begins at the end of the 180-day period and
ends 180 days after the date of the judicial determination, but
shall (unless otherwise prohibited) be made for periods
thereafter.''.
(b) Effective Date.--The amendments made by subsection (a) shall be
effective with respect to foster care maintenance payments made, under
State plans in fiscal year 1996 and succeeding fiscal years, on behalf
of children placed in foster care on or after October 1, 1995.
SEC. 13218. STUDY OF REASONABLE EFFORTS.
(a) In General.--The Secretary of Health and Human Services shall
conduct a study of the implementation by the States of section
471(a)(15) of the Social Security Act, giving particular attention to--
(1) standards used by States in determining what action to
take, and whether and for how long to continue efforts--
(A) before the placement of a child in foster care,
to prevent or eliminate the need for removal of the
child from the home of the child; and
(B) to return a child home rather than to seek some
other planned, permanent placement; and
(2) the responses of the courts to the State actions
described in paragraph (1) of this subsection, including
whether such responses facilitate or impede the achievement by
State agencies of the objectives of such section 471(a)(15).
(b) Report and Recommendations.--Within 18 months after the date of
the enactment of this Act, the Secretary of Health and Human Services
shall submit to the Congress a report, with such recommendations as the
Secretary finds appropriate, based on the results of the study required
by subsection (a) of this section, which describes State practices that
the Secretary has found effective in achieving the objectives of
section 471(a)(15) of the Social Security Act, and, if appropriate,
shall set forth model practices for consideration by the States.
SEC. 13219. ENHANCED MATCH FOR AUTOMATED DATA SYSTEMS.
(a) Payments to States.--
(1) In general.--Section 474(a)(3) (42 U.S.C. 674(a)(3)) is
amended--
(A) by striking ``and'' at the end of subparagraph
(B);
(B) by redesignating subparagraph (C) as
subparagraph (E); and
(C) by inserting after subparagraph (B) the
following:
``(C) 90 percent of so much of such expenditures as
are for the planning, design, development, or
installation of statewide mechanized data collection
and information retrieval systems (including 90 percent
of the full amount of expenditures for hardware
components for such systems) but only to the extent
that such systems--
``(i) meet the requirements imposed by
regulations promulgated pursuant to section
479(b)(2);
``(ii) to the extent practicable, are
capable of interfacing with the State data
collection system that collects information
relating to child abuse and neglect;
``(iii) to the extent practicable, have the
capability of interfacing with, and retrieving
information from, the State data collection
system that collects information relating to
the eligibility of individuals under part A
(for the purposes of facilitating verification
of eligibility of foster children); and
``(iv) are determined by the Secretary to
be likely to provide more efficient,
economical, and effective administration of the
programs carried out under a State plan
approved under part B or this part; and
``(D) 50 percent of so much of such expenditures as
are for the operation of the statewide mechanized data
collection and information retrieval systems referred
to in subparagraph (C); and''.
(2) Treatment of state expenditures for data collection and
information retrieval systems.--Section 474 (42 U.S.C. 674), as
amended by section 13224 of this Act, is amended by adding at
the end the following:
``(c) Automated Data Collection Expenditures.--The Secretary shall
treat as necessary for the proper and efficient administration of the
State plan all expenditures of a State necessary in order for the State
to plan, design, develop, install, and operate data collection and
information retrieval systems described in subsection (a)(3)(C),
without regard to whether the systems may be used with respect to
foster or adoptive children other than those on behalf of whom foster
care maintenance payments or adoption assistance payments may be made
under this part.''.
(3) Effective date.--The amendments made by this subsection
shall apply to expenditures during fiscal years 1994, 1995, and
1996.
(b) Termination of Enhanced Match.--
(1) In general.--Section 474(a)(3)(C) (42 U.S.C.
674(a)(3)(C)), as amended by subsection (a) of this section, is
amended by striking ``90 percent'' each place such term appears
and inserting ``50 percent''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to expenditures during fiscal years beginning on or
after October 1, 1996.
SEC. 13220. PERIODIC REEVALUATION OF FOSTER CARE MAINTENANCE PAYMENTS.
(a) In General.--Section 471(a)(11) (42 U.S.C. 671(a)(11)) is
amended--
(1) by inserting ``(A)'' after ``(11)'';
(2) by striking ``and amounts paid as foster care
maintenance payments and adoption assistance''; and
(3) by adding at the end the following:
``(B) provides that, at least once every 3 years, the State
agency will review the amount paid as foster care maintenance
payments and adoption assistance payments to ensure their
continuing appropriateness, and will submit to the Secretary
(and make available to the public) a report on the results of
the review, in such form and manner as the Secretary may by
regulation require, which contains, at a minimum--
``(i) a statement of the manner in which the foster
care maintenance payment level is determined, including
information on the cost of foster care with respect to
which such payments are made;
``(ii) information on the amount of the basic
foster care maintenance payment level, and as to
whether such payment level includes an amount to cover
the cost of clothing, and whether such payment level
varies by the type of care or the special needs or age
of the child, and, if so, the payment levels for each
special needs, care, or age category;
``(iii) if such payments are not made at a
different rate for children who test positive for human
immunodeficiency virus, have acquired immune deficiency
syndrome, are addicted to drugs, suffer from
complications due to exposure to drugs or alcohol, or
have other severe special needs, the reasons therefor;
and
``(iv) information on any limitations imposed by
the State on adoption assistance payment levels;''.
(b) Effective Date.--The amendment made by this section shall be
effective with respect to calendar quarters beginning on or after
October 1, 1994.
SEC. 13221. DISPOSITIONAL HEARING.
Section 475(5)(C) (42 U.S.C. 675(5)(C)) is amended by striking
``periodically'' and inserting ``not less frequently than every 12
months''.
SEC. 13222. HEALTH CARE PLANS FOR FOSTER CHILDREN.
(a) In General.--Section 475(1)(C) (42 U.S.C. 675(1)(C)) is
amended--
(1) in clause (vii), by striking ``and''; and
(2) by redesignating clause (viii) as clause (ix) and
inserting after clause (vii) the following:
``(viii) a record indicating that the child's
foster care provider was advised (where appropriate) of
the child's eligibility for early and periodic
screening, diagnostic, and treatment services under
title XIX; and''.
(b) Effective Date.--The amendments made by this section shall
apply to case plans established or reviewed on or after January 1,
1994.
SEC. 13223. INDEPENDENT LIVING.
(a) Treatment of Assets of Participating Youths.--Section 477 (42
U.S.C. 677) is amended--
(1) by redesignating subsection (i) as subsection (j); and
(2) by inserting after subsection (h) the following:
``(i) Notwithstanding any other provision of this title, with
respect to a child who is included in a program established by a State
agency under subsection (a), an amount of the assets of the child which
would otherwise be regarded as resources for purposes of determining
eligibility for benefits under this title may be disregarded for the
purpose of allowing the child to establish a household, pursue
education, or otherwise complete the transition to independent living.
The amount disregarded may not exceed an amount determined by the State
agency to be reasonable for such purposes.''.
(b) Permanent Extension of Program.--Section 477 (42 U.S.C. 677) is
amended--
(1) in subsection (a)(1), by striking the 3rd sentence;
(2) in subsection (c), by striking ``of the fiscal years
1988 through 1992'' and inserting ``succeeding fiscal year'';
(3) in subsection (e)(1)(A), by striking ``each of the
fiscal years 1987 through 1992'' and inserting ``fiscal year
1987 and any succeeding fiscal year'';
(4) in subsection (e)(1)(B), by striking ``fiscal years
1991 and 1992'' and inserting ``fiscal year 1991 and any
succeeding fiscal year''; and
(5) in subsection (e)(1)(C)(ii), by striking ``fiscal year
1992'' and inserting ``any succeeding fiscal year''.
(c) Effective Dates.--
(1) Treatment of assets of participating youths.--The
amendments made by subsection (a) shall apply to activities in
fiscal years beginning on or after October 1, 1995.
(2) Permanent extension of program.--The amendments made by
subsection (b) shall apply to activities engaged in on or after
October 1, 1992.
SEC. 13224. ELIMINATION OF FOSTER CARE CEILINGS AND OF AUTHORITY TO
TRANSFER UNUSED FOSTER CARE FUNDS TO CHILD WELFARE
SERVICES PROGRAMS.
(a) Repeal.--Subsections (b) and (c) of section 474 (42 U.S.C.
674(b) and (c)) are hereby repealed.
(b) Conforming Amendments.--Section 474 (42 U.S.C. 674) is
amended--
(1) in subsection (d)(1)--
(A) by striking ``subsections (a), (b), and (c)''
and inserting ``subsection (a)''; and
(B) by striking ``the provisions of such
subsections'' and inserting ``subsection (a)''; and
(2) by redesignating subsection (d) as subsection (b).
(c) Effective Date.--The amendments and repeal made by this section
shall apply to payments for calendar quarters beginning on or after
October 1, 1993.
SEC. 13225. TRAINING OF AGENCY STAFF AND FOSTER AND ADOPTIVE PARENTS.
(a) In General.--Section 8006(b) of the Omnibus Budget
Reconciliation Act of 1989 (42 U.S.C. 674 note) is amended by striking
``, and before October 1, 1992''.
(b) Retroactive Applicability.--The Social Security Act shall be
applied and administered as if the amendment made by subsection (a) had
been made on October 1, 1992.
SEC. 13226. ON-SITE REVIEWS AND AUDITS OF STATE CLAIMS FOR FOSTER CARE
AND ADOPTION ASSISTANCE.
(a) On-Site Reviews and Audits of State Claims.--Section 474 (42
U.S.C. 674), as amended by sections 13224 and 13219(a)(2) of this Act,
is amended--
(1) by redesignating subsection (c) as subsection (d); and
(2) by inserting after subsection (b) the following:
``(c) On-Site Reviews and Audits of State Claims for Payment.--
``(1) Regulations specifying review standards.--The
Secretary shall promulgate regulations applicable to on-site
reviews and audits of State expenditures for foster care
maintenance payments and adoption assistance payments under
this part, which specify--
``(A) the criteria to be used to determine the
appropriateness of expenditures identified in sampled
case files;
``(B) the criteria to be used to determine the
appropriateness of expenditures for child placement
services and plan administration; and
``(C) the types of erroneous expenditures which
will be disregarded for purposes of determining the
appropriateness of payments under this part (including
erroneous payments resulting from the State's reliance
upon and correct use of formal written statements of
Federal law or policy provided to the State by the
Secretary).
``(2) Development and publication of written standards and
procedures.--The Secretary, after consultation with
organizations representing State and local governmental
agencies with responsibility for foster care and adoption
services and other relevant agencies and organizations, shall
develop and furnish to State agencies a written description of
the methods and procedures to be used in the on-site audits and
reviews referred to in paragraph (1), which specify--
``(A) the methods and procedures to be used to
select a sample of case files for review or audit;
``(B) the procedures to be used in reviewing or
auditing sampled case files to determine erroneous
expenditures;
``(C) the procedures to be used to review or audit
State expenditures for child placement services and
plan administration; and
``(D) the methodology to be used to extrapolate
from review or audit findings to all expenditures under
the State plan.
``(3) Advance notice to states.--The Secretary shall not,
in a review or audit of State expenditures during a fiscal
year, use any criterion specified pursuant to paragraph (1), or
any procedure or methodology specified pursuant to paragraph
(2), which was not published in final regulations or furnished
in writing to the State (as applicable) at least 3 months
before the beginning of the fiscal year.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to expenditures in fiscal years beginning on or after October 1,
1994.
SEC. 13227. CONFORMITY REVIEWS.
(a) In General.--Part A of title XI (42 U.S.C. 1301-1320b-13) is
amended by inserting after section 1122 the following:
``SEC. 1123. REVIEWS OF CHILD AND FAMILY SERVICES PROGRAMS, AND OF
FOSTER CARE AND ADOPTION ASSISTANCE PROGRAMS, FOR
COMPLIANCE WITH STATE PLAN REQUIREMENTS.
``(a) In General.--The Secretary shall not impose a financial
penalty on any State for any failure of the State programs under parts
B and E of title IV to comply with any requirement of any State plan
approved under such part B or E, except pursuant to final regulations,
developed after consultation with State agencies administering such
programs, which meet the requirements of this section.
``(b) Elements of Review System.--The regulations referred to in
subsection (a) shall--
``(1) specify the timetable for compliance reviews of State
programs, which--
``(A) shall provide for annual reviews of each
State program during the 1st 2 years of operation;
``(B) shall provide for review of a State program
not later than 1 year following a review in which the
State program was found not to be in substantial
compliance with plan requirements; and
``(C) may provide for less frequent reviews of
State programs which have been found to be in
substantial compliance with plan requirements, but
shall permit the Secretary to reinstate more frequent
reviews based on information which indicates that the
State program may not be in compliance with plan
requirements;
``(2) specify the plan requirements subject to review, and
the criteria to be used to measure compliance with such
requirements and to determine whether there is a substantial
failure to comply with a plan requirement;
``(3) specify the method to be used to determine the
financial penalty to be imposed (subject to paragraph (4)) for
a failure to comply with plan requirements, which ensures
that--
``(A) a financial penalty will not be imposed with
respect to a program, unless it is determined that the
program fails substantially to so comply;
``(B) a financial penalty will not be imposed for a
failure to so comply resulting from the State's
reliance upon and correct use of formal written
statements of Federal law or policy provided to the
State by the Secretary; and
``(C) the amount of financial penalty is related to
the extent of the noncompliance; and
``(4) require the Secretary, with respect to any State
found to have failed substantially to comply with plan
requirements--
``(A) to afford the State an opportunity to adopt
and implement a corrective action plan, approved by the
Secretary, designed to end the noncompliance;
``(B) to make technical assistance available to the
State to the extent necessary to enable the State to
develop and implement such a corrective action plan;
``(C) to suspend the imposition of any penalty
under this section while such a corrective action plan
is in effect; and
``(D) to rescind any such penalty if the
noncompliance is ended by successful completion of such
a corrective action plan.
``(c) Provisions for Administrative and Judicial Review.--The
regulations referred to in subsection (a) shall--
``(1) require the Secretary, not later than 10 days after a
determination that a program of the State is not in compliance
with applicable plan requirements, to notify the State of--
``(A) the basis for the determination; and
``(B) the amount of the financial penalty (if any)
imposed on the State;
``(2) afford the State an opportunity to appeal the
determination to the Departmental Appeals Board within 60 days
after receipt of the notice described in paragraph (1) (or, if
later, after failure to continue or to complete a corrective
action plan); and
``(3) afford the State an opportunity to obtain judicial
review of an adverse decision of the Board, within 60 days
after the State receives notice of the decision of the Board,
by appeal to the district court of the United States for the
judicial district in which the principal or headquarters office
of the agency responsible for administering the program is
located.''.
(b) Conforming Amendment.--Section 471(b) (42 U.S.C. 671(b)) is
amended by striking all that follows the 1st sentence.
(c) Effective Date.--The amendments made by subsections (a) and (b)
shall take effect on the date of the enactment of this Act.
(d) Construction.--This section shall not be construed to prevent
the Secretary, before the effective date of final regulations meeting
the requirements of section 1123 of the Social Security Act, from
conducting compliance reviews of State programs under parts B and E of
such Act for the purpose of providing information and technical
assistance to States concerning corrective actions needed in order to
comply with plan requirements applicable to such programs.
SEC. 13228. REPEAL OF ANNUAL REPORT ON VOLUNTARY PLACEMENT.
Section 102(e) of the Adoption Assistance and Child Welfare Act of
1980 (42 U.S.C. 672 note) is hereby repealed.
SEC. 13229. DEMONSTRATION PROJECTS.
Part A of title XI (42 U.S.C. 1301-1320b-13) is amended by
inserting after section 1128B the following:
``SEC. 1129. DEMONSTRATION PROJECTS.
``(a) In General.--The Secretary may authorize not more than 10
States to conduct demonstration projects pursuant to this section which
the Secretary finds are likely to promote the objectives of part B or E
of title IV.
``(b) Waiver Authority.--The Secretary may waive compliance with
any requirement of part B or E of title IV which (if applied) would
prevent a State from carrying out a demonstration project under this
section or prevent the State from effectively achieving the purpose of
such a project, except that the Secretary may not waive--
``(1) any provision of section 427 (as in effect before
October 1, 1994), section 422(b)(9) (as in effect after such
date), or section 479; or
``(2) any provision of such part E, to the extent that the
waiver would impair the entitlement of any qualified child or
family to benefits under a State plan approved under such part
E.
``(c) Treatment as Program Expenditures.--For purposes of parts B
and E of title IV, the Secretary shall consider the expenditures of any
State to conduct a demonstration project under this section to be
expenditures under subpart 1 or 2 of such part B, or under such part E,
as the State may elect.
``(d) Duration of Demonstration.--A demonstration project under
this section may be conducted for not more than 5 years.
``(e) Application.--Any State seeking to conduct a demonstration
project under this section shall submit to the Secretary an
application, in such form as the Secretary may require, which
includes--
``(1) a description of the proposed project, the geographic
area in which the proposed project would be conducted, the
children or families who would be served by the proposed
project, and the services which would be provided by the
proposed project (which shall provide, where appropriate, for
random assignment of children and families to groups served
under the project and to control groups);
``(2) a statement of the period during which the proposed
project would be conducted;
``(3) a discussion of the benefits that are expected from
the proposed project (compared to a continuation of activities
under the approved plan or plans of the State);
``(4) an estimate of the costs or savings of the proposed
project;
``(5) a statement of program requirements for which waivers
would be needed to permit the proposed project to be conducted;
``(6) a description of the proposed evaluation design; and
``(7) such additional information as the Secretary may
require.
``(f) Evaluations; Report.--Each State authorized to conduct a
demonstration project under this section shall--
``(1) obtain an evaluation by an independent contractor of
the effectiveness of the project, using an evaluation design
approved by the Secretary which provides for--
``(A) comparison of methods of service delivery
under the project, and such methods under a State plan
or plans, with respect to efficiency, economy, and any
other appropriate measures of program management;
``(B) comparison of outcomes for children and
families (and groups of children and families) under
the project, and such outcomes under a State plan or
plans, for purposes of assessing the effectiveness of
the project in achieving program goals; and
``(C) any other information that the Secretary may
require; and
``(2) provide interim and final evaluation reports to the
Secretary, at such times and in such manner as the Secretary
may require.
``(g) Cost Neutrality.--The Secretary may not authorize a State to
conduct a demonstration project under this section unless the Secretary
determines that the total amount of Federal funds that will be expended
under (or by reason of) the project over its approved term (or such
portion thereof or other period as the Secretary may find appropriate)
will not exceed the amount of such funds that would be expended by the
State under the State plans approved under parts B and E of title IV if
the project were not conducted.''.
SEC. 13230. PLACEMENT ACCOUNTABILITY.
(a) Case Plan Requirements.--Section 475(5)(A) (42 U.S.C.
675(5)(A)) is amended by adding at the end the following: ``which--
``(i) if the child has been placed in a
foster family home or child-care institution a
substantial distance from the home of the
parents of the child, or in a State different
from the State in which the home is located,
sets forth the reasons why such placement is in
the best interests of the child, and
``(ii) if the child has been placed in
foster care outside the State, requires that,
at least every 6 months, a caseworker on the
staff of the State agency of the State in which
the home of the parents of the child is
located, or of the State in which the child has
been placed, visit such child in such home or
institution and submit a report on such visit
to the State agency of the State in which the
home of the parents of the child is located,''.
(b) Dispositional Hearing.--Section 475(5)(C) (42 U.S.C. 675(5)(C))
is amended by inserting ``and, in the case of a child described in
subparagraph (A)(ii), whether the out-of-State placement continues to
be appropriate and in the best interests of the child,'' after ``long-
term basis)''.
(c) Data Collection.--Section 479(c)(3)(C) (42 U.S.C. 679(c)(3)(C))
is amended--
(1) by striking ``and'' at the end of clause (i); and
(2) by adding at the end the following:
``(iii) children placed in foster care
outside the State, and''.
(d) Effective Dates.--The amendments made by subsections (a), (b),
and (c) shall be effective with respect to fiscal years beginning on
and after October 1, 1994.
SEC. 13231. PAYMENTS OF STATE CLAIMS FOR FOSTER CARE AND ADOPTION
ASSISTANCE.
Section 474(b) (42 U.S.C. 674(b)), as so redesignated by section
13239(b)(2) of this Act, is amended by adding at the end the following:
``(4)(A) Within 60 days after receipt of a State claim for
expenditures pursuant to subsection (a), the Secretary shall allow,
disallow, or defer such claim.
``(B) Within 15 days after a decision to defer such a State claim,
the Secretary shall notify the State of the reasons for the deferral
and of the additional information necessary to determine the
allowability of the claim.
``(C) Within 90 days after receiving such necessary information (in
readily reviewable form), the Secretary shall--
``(i) disallow the claim, if able to complete the review
and determine that the claim is not allowable, or
``(ii) in any other case, allow the claim, subject to
disallowance (as necessary)--
``(I) upon completion of the review, if it is
determined that the claim is not allowable; or
``(II) on the basis of findings of an audit or
financial management review.''.
SEC. 13232. MORATORIUM ON COLLECTION OF DISALLOWANCES.
The Secretary of Health and Human Services shall not--
(1) before October 1, 1994, reduce any payment to, withhold
any payment from, or seek any repayment from any State under
part B or E of title IV of the Social Security Act by reason of
a determination made in connection with a review of State
compliance with section 427 of such Act for any Federal fiscal
year before fiscal year 1995; or
(2) reduce any payment to, withhold any payment from, or
seek any repayment from any State under such part E by reason
of a determination made in connection with any on-site Federal
financial review, or any audit conducted by the Inspector
General using similar methodologies.
SEC. 13233. BORDER REGION CHILD WELFARE WORKER TRAINING DEMONSTRATION.
(a) In General.--The Secretary shall make grants to not more than 5
eligible institutions to train individuals to deliver culturally
sensitive and bilingual child welfare services in areas of the United
States that border on Mexico, 1 of which grants shall be for training
to deliver child welfare services to historically unserved or
underserved populations in an urban center with a high concentration of
such populations.
(b) Applications.--The Secretary shall approve an application of an
institution for a grant under this section only if the application--
(1) demonstrates to the satisfaction of the Secretary that
the institution has a history of, or a plan for, training
students to deliver culturally sensitive and bilingual child
welfare services in a border county;
(2) provides assurances that the institution will develop
and implement, in consultation with the child welfare agency of
the State in which the institution is located, a curriculum in
the field of child welfare services which--
(A) is sensitive to the culture of--
(i) the areas of the United States that
border on Mexico; or
(ii) in the case of the institution which
receives the urban center grant described in
subsection (a), the historically unserved or
underserved populations in the urban center;
and
(B) includes training for identification of health
problems of children and their families and of child
abuse and neglect;
(3) provides assurances that each individual who receives a
stipend with such training will enter into an agreement with
the institution under which the individual agrees--
(A) to be employed for a period of years equivalent
to the period of such training, in a public or private
nonprofit family assistance agency that provides
services directly to residents of--
(i) the border county in which the agency
is located; or
(ii) in the case of the institution which
receives the urban center grant described in
subsection (a), the urban center in which the
agency is located; and
(B) if the individual fails to be so employed for
such period, to repay to the Secretary, in accordance
with such conditions as the Secretary may prescribe,
all or part of the amount of the stipend, plus
interest, and, if applicable, reasonable collection
fees; and
(4) provides that each agreement entered into with an
individual pursuant to paragraph (3) will fully disclose the
terms and conditions under which the stipend is to be provided.
(c) Evaluations.--Each institution that receives a grant under this
section shall develop and carry out a plan for evaluating the effects
of the training provided under the grant, and shall submit to the
Secretary a report on the evaluation.
(d) Definitions.--As used in this section:
(1) Family assistance agency.--The term ``family assistance
agency'' means a child welfare agency, family planning agency,
hospital, clinic, community mental health facility, or drug and
alcohol treatment program.
(2) Eligible institution.--The term ``eligible
institution'' means a public or private nonprofit institution
of higher learning that is located in a State that contains a
border county.
(3) Border county.--The term ``border county'' means--
(A) a United States county that borders on Mexico;
and
(B) a United States county that borders on a county
described in subparagraph (A).
(4) Urban center.--The term ``urban center'' means an area
in a metropolitan statistical area, as designated by the Office
of Management and Budget, which has a high incidence of
individuals in historically unserved or underserved populations
who are in need of social services, as determined by the
Secretary using the most recent and best available information.
(5) Historically unserved or underserved populations.--The
term ``historically unserved or underserved populations''
includes--
(A) socially and economically disadvantaged
populations;
(B) persons with limited English proficiency;
(C) populations residing in urban areas and
exhibiting a high incidence of child abuse, neglect, or
abandonment, as determined by the Secretary;
(D) homeless persons (within the meaning of section
103 of the Stewart B. McKinney Homeless Assistance
Act);
(E) persons who are, or are in danger of becoming,
infected with the human immunodeficiency virus; and
(F) persons who abuse alcohol or drugs.
(6) Secretary.--The term ``Secretary'' means the Secretary
of Health and Human Services.
(e) Authorization of Appropriations.--There are authorized to be
appropriated such sums as may be necessary to carry out this section.
SEC. 13234. EFFECT OF FAILURE TO CARRY OUT STATE PLAN.
(a) In General.--Part A of title XI (42 U.S.C. 1301-1320b-13), as
amended by section 13229 of this Act, is amended by inserting after
section 1129 the following:
``SEC. 1130. EFFECT OF FAILURE TO CARRY OUT STATE PLAN.
``In an action brought to enforce a provision of the Social
Security Act, such provision is not to be deemed unenforceable because
of its inclusion in a section of the Act requiring a State plan or
specifying the required contents of a State plan. This section is not
intended to limit or expand the grounds for determining the
availability of private actions to enforce State plan requirements
other than by overturning any such grounds applied in Suter v. Artist
M., 112 S. Ct. 1360 (1992), but not applied in prior Supreme Court
decisions respecting such enforceability: Provided, however, That this
section is not intended to alter the holding in Suter v. Artist M. that
section 471(a)(15) of the Act is not enforceable in a private right of
action.''.
(b) Applicability.--The amendment made by subsection (a) shall
apply to actions pending on the date of the enactment of this Act and
to actions brought on or after such date of enactment.
CHAPTER 2--CHILD SUPPORT ENFORCEMENT
SEC. 13241. STATE PATERNITY ESTABLISHMENT PROGRAMS.
(a) Performance Standards.--Section 452(g) (42 U.S.C. 652(g)) is
amended--
(1) in paragraph (1)--
(A) by striking ``1991'' and inserting ``1994'';
(B) by inserting ``is based on reliable data and''
before ``equals or exceeds''; and
(C) by striking subparagraphs (A), (B), and (C) and
inserting the following:
``(A) 75 percent;
``(B) for a State with a paternity establishment percentage
of not less than 50 percent but less than 75 percent for the
fiscal year, the paternity establishment percentage of the
State for the immediately preceding year plus 3 percentage
points; or
``(C) for a State with a paternity establishment percentage
of less than 50 percent for such fiscal year, the paternity
establishment percentage of the State for the immediately
preceding year plus 6 percentage points.''; and
(2) in paragraph (2)--
(A) by striking ``(or under all such plans)'' each
place such term appears;
(B) by inserting ``or part E'' after ``under part
A'' each place such term appears;
(C) by amending subparagraph (B) to read as
follows:
``(B) the term `reliable data' means the most
recent data available which are found by the Secretary
to be reliable for purposes of this section.'';
(D) by inserting ``unless paternity is established
for such child'' after ``the death of a parent'';
(E) by striking ``parent or'' and inserting
``parent,''; and
(F) by inserting ``, or any child with respect to
whom the State agency administering the plan under part
E determines (as provided in section 454(4)(B)) that it
is against the best interest of such child to do so''
after ``cooperate under section 402(a)(26)''.
(b) State Plan Requirements.--
(1) Required procedures.--Section 466(a) (42 U.S.C. 666(a))
is amended--
(A) in paragraph (2)--
(i) by striking ``at the option of the
State,''; and
(ii) by inserting ``and paternity
establishment'' after ``support order issuance
and enforcement'';
(B) in paragraph (5), by adding at the end the
following:
``(C) Procedures for a simple civil process for
voluntarily acknowledging paternity under which the
State must explain the rights and responsibilities of
acknowledging paternity, and afford due process
safeguards. Such procedures must include (i) a
hospital-based program for the voluntary acknowledgment
of paternity during the period immediately before or
after the birth of a child, and (ii) the inclusion of
signature lines on applications for official birth
certificates which, once signed by the father and the
mother, are considered a voluntary acknowledgment of
paternity.
``(D) Procedures under which the voluntary
acknowledgment of paternity of a child by an individual
in the manner described in subparagraph (C)(ii) creates
a rebuttable or, at the option of the State, conclusive
presumption that the individual is the father of the
child, and under which such a voluntary acknowledgment
is admissible as evidence of paternity.
``(E) Procedures under which a voluntary
acknowledgment of paternity in the manner described in
subparagraph (C)(ii) must be recognized as a basis for
seeking a support order without first requiring any
further proceedings to establish paternity.
``(F) Procedures requiring that (i) any objection
to genetic testing results be made in writing within a
specified number of days before any hearing at which
such results may be introduced into evidence, and (ii)
if no objection is made, the test results be admissible
as evidence of paternity without the need for
foundation testimony or other proof of authenticity or
accuracy.
``(G) Procedures which create a rebuttable or, at
the option of the State, conclusive presumption of
paternity of a child, upon genetic testing results
indicating a threshold probability of the alleged
father being the father of the child.
``(H) Procedures requiring a default order to be
entered in a paternity case upon a showing that process
has been served on the defendant and any additional
showing required by State law.''; and
(C) by inserting after paragraph (10) the
following:
``(11) Procedures under which a State must give full faith
and credit to a determination of paternity made by any other
State, whether established through voluntary acknowledgment or
through administrative or judicial processes.''.
(2) Furnishing of social security numbers.--
(A) In general.--Section 466(a) (42 U.S.C. 666(a)),
as amended by paragraph (1)(C) of this subsection, is
amended by inserting after paragraph (11) the
following:
``(12)(A) Procedures under which, in the administration of
any law involving the issuance, reissuance, or amendment of a
birth certificate, the State shall require each parent to
furnish to the State, or any agency or political subdivision
thereof having administrative responsibility for the law
involved, the social security account number (or numbers, if
the parent has more than 1 such number) issued to the parent,
unless the State (in accordance with regulations prescribed by
the Secretary) finds good cause for not requiring the
furnishing of the number.
``(B) Procedures under which any number furnished under
subparagraph (A) shall be made available to the agency
administering the State plan under this part, in accordance
with Federal or State law or regulation.
``(C) Procedures under which--
``(i) any number furnished under subparagraph (A)
shall not be recorded on the birth certificate; and
``(ii) any social security account number, obtained
with respect to the issuance by the State of any birth
certificate, shall not be used for other than child
support purposes, unless section 7(a) of the Privacy
Act of 1974 does not prohibit the State from requiring
the disclosure of the number, by reason of the State
having adopted, before January 1, 1975, a statute or
regulation requiring such disclosure.''.
(B) Conforming amendments.--Section
205(c)(2)(C)(ii) (42 U.S.C. 405(c)(2)(C)(ii)) is
amended--
(i) by striking ``(ii) In the
administration of any law involving the
issuance'' and inserting ``(ii) In the
administration of any law involving the
issuance, reissuance, or amendment''; and
(ii) by striking ``any purpose other than
for the enforcement of child support orders in
effect in the State'' and inserting ``other
than child support purposes''.
(c) Conforming Repeal.--Section 468 (42 U.S.C. 668) is hereby
repealed.
(d) Effective Date.--The amendments and repeal made by this section
shall become effective with respect to a State--
(1) on October 1, 1993, or, if later
(2) upon enactment by the legislature of the State of all
laws required by such amendments,
but in no event later than the 1st day of the 1st calendar quarter
beginning after the close of the 1st regular session of the State
legislature that begins after the date of the enactment of this Act.
For purposes of the preceding sentence, in the case of a State that has
a 2-year legislative session, each year of such session shall be deemed
to be a separate regular session of the State legislature.
SEC. 13242. ENFORCEMENT OF HEALTH INSURANCE SUPPORT.
(a) State Plan Requirements.--Section 454(a) (42 U.S.C. 654(a)) is
amended--
(1) by striking ``and'' at the end of paragraph (23);
(2) by striking the period at the end of paragraph (24) and
inserting ``; and''; and
(3) by inserting after paragraph (24) the following:
``(25) provide assurances satisfactory to the Secretary
that the State has in effect laws applicable to health insurers
and insurance policies or programs subject to the laws of the
State that--
``(A) prohibit insurers' consideration, in
determining an individual's eligibility for or coverage
under any such policy or program, of such individual's
eligibility for or coverage under the plan of any State
under title XIX;
``(B) provide that, where an individual assigns
rights to any State in accordance with section 1912,
that State is subrogated, to the extent of medical
assistance furnished, to the individual's rights under
any health insurance policy or program;
``(C) prohibit insurers from applying, to State
agencies administering programs under title XIX and
acting as agents or subrogees (for purposes of
insurance policies or programs of such insurers) of
individuals receiving medical assistance under such
State programs, requirements (with respect to deadlines
for filing claims or any other matters) different from
requirements applicable to any other applicant,
beneficiary, agent, or subrogee;
``(D) prohibit insurers from denying enrollment of
a child under the health insurance coverage of the
child's parent on grounds that--
``(i) the child does not reside with the
parent, or
``(ii) the child was born out of wedlock;
``(E) in any case where a parent is required by
court or administrative order to provide health
insurance coverage for a child, require insurers,
without regard to otherwise applicable enrollment
season restrictions--
``(i) to permit such parent, upon
application, to enroll in family coverage (if
otherwise eligible and not already so
enrolled), and to enroll such child under such
family coverage, and
``(ii) where such a parent who is enrolled
in family coverage fails to make application,
to enroll such child under such family coverage
upon application by the child's other parent or
by the State agency administering the program
under this part or title XIX; and
``(F) in any case where a child is covered under
the health insurance of a noncustodial parent, require
insurers--
``(i) to permit the custodial parent (or
service provider, with the custodial parent's
approval), or any State agency administering a
program under title XIX, to submit claims for
covered services without the approval of the
noncustodial parent, and
``(ii) to make payment on claims submitted
in accordance with clause (i) directly to the
custodial parent, service provider, or State
agency submitting such claim;
``(26) provide assurances satisfactory to the Secretary
that the State has in effect laws requiring employers doing
business in the State--
``(A) upon notice of a court or administrative
order requiring an employee to provide health insurance
coverage for the employee's child, and upon application
by such employee (or, where such employee fails to make
application, by the child's other parent or the State
agency administering the program under this part or
title XIX), to permit enrollment of such child at any
time as a dependent of the employee under the
employer's group health insurance;
``(B) to permit disenrollment from such group
health insurance by such employee, or elimination of
coverage of such child, only upon receipt of
satisfactory evidence, in writing, that--
``(i) such court or administrative order is
no longer in effect, or
``(ii) the employee has enrolled or will
enroll in alternative health insurance covering
such child which will take effect immediately
upon the effective date of such disenrollment;
and
``(C) to withhold from such employee's compensation
the employee's share (if any) of premiums for such
health insurance, and to pay such share of premiums to
the insurer;
``(27) provide assurances satisfactory to the Secretary
that the State has in effect laws requiring the State agency to
garnish the wages, salary, or other employment income of, and
to withhold amounts from State tax refunds to, any person who--
``(A) is required by court or administrative order
to provide coverage of the costs of medical services to
an individual eligible for medical assistance under
title XIX,
``(B) has received payment from a third party for
the costs of medical services to such individual, and
``(C) has not used such payments to reimburse, as
appropriate, either such individual or the provider of
such services,
to the extent necessary to reimburse the State agency for
expenditures for such costs under its plan under title XIX, but
any claims for current or past-due child support shall take
priority over any such claims for the costs of medical
services.''.
(b) Effective Date.--
(1) In general.--The amendments made by subsection (a)
apply to calendar quarters beginning on or after April 1, 1994,
except as provided in paragraph (2).
(2) Extension for state law amendment.--In the case of a
State plan under part D of title IV of the Social Security Act
which the Secretary of Health and Human Services determines
requires State legislation in order for the plan to meet the
additional requirements imposed by the amendments made by
subsection (a), the State plan shall not be regarded as failing
to comply with the requirements of such title solely on the
basis of its failure to meet these additional requirements
before the 1st day of the 1st calendar quarter beginning after
the close of the 1st regular session of the State legislature
that begins after the date of enactment of this Act. For
purposes of the preceding sentence, in the case of a State that
has a 2-year legislative session, each year of such session
shall be deemed to be a separate regular session of the State
legislature.
SEC. 13243. REPORTS TO CREDIT BUREAUS ON PERSONS DELINQUENT IN CHILD
SUPPORT PAYMENTS.
(a) In General.--Section 466(a)(7) (42 U.S.C. 666(a)(7)) is
amended--
(1) by striking ``upon the request of such agency'' and
inserting ``, and procedures which require the State to
periodically report to any such agency the name of any parent
who owes overdue support and is at least 2 months delinquent in
the payment of such support and the amount of such delinquency
unless the agency requests not to receive such information'';
and
(2) by striking ``(C) a fee'' and all that follows through
``by the State'' and inserting ``, and (C) such information
shall not be made available to (i) a consumer reporting agency
which the State determines does not have sufficient capability
to systematically and timely make accurate use of such
information, or (ii) an entity which has not furnished evidence
satisfactory to the State that the entity is a consumer
reporting agency''.
(b) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by subsection (a) shall take effect on October
1, 1994.
(2) Exception.--If the Secretary of Health and Human
Services determines that a State is unable to comply with the
amendments made by subsection (a), such State shall be exempt
from compliance with such amendments until the State
establishes an automated data processing and information
retrieval system under section 454(24) of the Social Security
Act, or October 1, 1995, whichever occurs earlier.
CHAPTER 3--SUPPLEMENTAL SECURITY INCOME
SEC. 13251. FEES FOR FEDERAL ADMINISTRATION OF STATE SUPPLEMENTARY
PAYMENTS.
(a) In General.--
(1) Optional state supplementary payments.--Section 1616(d)
(42 U.S.C. 1382e(d)) is amended--
(A) by inserting ``(1)'' after ``(d)'';
(B) by inserting ``, plus an administration fee
assessed in accordance with paragraph (2) and any
additional services fee charged in accordance with
paragraph (3)'' before the period; and
(C) by adding after and below the end the
following:
``(2)(A) The Secretary shall assess each State an administration
fee in an amount equal to--
``(i) the number of supplementary payments made by the
Secretary on behalf of the State under this section for any
month in a fiscal year; multiplied by
``(ii) the applicable rate for the fiscal year.
``(B) As used in subparagraph (A), the term `applicable rate'
means--
``(i) for fiscal year 1994, $1.67;
``(ii) for fiscal year 1995, $3.33;
``(iii) for fiscal year 1996, $5.00; and
``(iv) for fiscal year 1997 and each succeeding fiscal
year, $5.00, or such different rate as the Secretary determines
pursuant to criteria established in regulations is appropriate
for the State, taking into account the complexity of the
State's supplementary payment program.
``(C) All fees collected pursuant to this paragraph shall be
transferred to the United States at the same time that amounts for such
supplementary payments are required to be so transferred.
``(3)(A) The Secretary shall charge a State an additional services
fee if, at the request of the State, the Secretary provides additional
services beyond the level customarily provided, in the administration
of State supplementary payments pursuant to this section.
``(B) The additional services fee shall be in an amount that the
Secretary determines is necessary to cover all costs (including
indirect costs) incurred by the Federal Government in furnishing the
additional services referred to in subparagraph (A).
``(C) The additional services fee shall be payable in advance or by
way of reimbursement.
``(4) All administration fees and additional services fees
collected pursuant to this subsection shall be deposited in the general
fund of the Treasury of the United States as miscellaneous receipts.''.
(2) Mandatory state supplementary payments.--Section
212(b)(3) of Public Law 93-66 (42 U.S.C. 1382 note) is
amended--
(A) by inserting ``(A)'' after ``(3)'';
(B) by inserting ``, plus an administration fee
assessed in accordance with subparagraph (B) and any
additional services fee charged in accordance with
subparagraph (C)'' before the period; and
(C) by adding after and below the end the
following:
``(B)(i) The Secretary shall assess each State an administration
fee in an amount equal to--
``(I) the number of supplementary payments made by the
Secretary on behalf of the State under this subsection for any
month in a fiscal year; multiplied by
``(II) the applicable rate for the fiscal year.
``(ii) As used in clause (i), the term `applicable rate' means--
``(I) for fiscal year 1994, $1.67;
``(II) for fiscal year 1995, $3.33;
``(III) for fiscal year 1996, $5.00; and
``(IV) for fiscal year 1997 and each succeeding fiscal
year, $5.00, or such different rate as the Secretary determines
pursuant to regulations established in regulations is
appropriate for the State, taking into account the complexity
of the State's supplementary payment program.
``(iii) All fees collected pursuant to this subparagraph shall be
transferred to the United States at the same time that amounts for such
supplementary payments are required to be so transferred.
``(C)(i) The Secretary shall charge a State an additional services
fee if, at the request of the State, the Secretary provides additional
services beyond the level customarily provided, in the administration
of State supplementary payments pursuant to this subsection.
``(ii) The additional services fee shall be in an amount that the
Secretary determines is necessary to cover all costs (including
indirect costs) incurred by the Federal Government in furnishing the
additional services referred to in clause (i).
``(iii) The additional services fee shall be payable in advance or
by way of reimbursement.
``(D) All administration fees and additional services fees
collected pursuant to this paragraph shall be deposited in the general
fund of the Treasury of the United States as miscellaneous receipts.''.
(b) Effective Date.--The amendments made by this section shall
apply to supplementary payments made pursuant to section 1616(a) of the
Social Security Act or section 212(a) of Public Law 93-66 for any
calendar month beginning after September 30, 1993, and to services
furnished after such date, regardless of whether regulations to
implement such amendments have been promulgated by such date, or
whether any agreement entered into under such section 1616(a) or such
section 212(a) has been modified.
SEC. 13252. EXCLUSION FROM INCOME OF STATE RELOCATION ASSISTANCE.
Section 5035(c) of the Omnibus Budget Reconciliation Act of 1990
(42 U.S.C. 1382a note; 104 Stat. 1388-225) is amended--
(1) by striking ``The amendments made by this section'' and
inserting ``(1) The amendments made by subsection (b)''; and
(2) by adding at the end the following:
``(2) The amendments made by subsection (a) shall apply with
respect to benefits for calendar months beginning on or after May 1,
1991.''.
SEC. 13253. PREVENTION OF ADVERSE EFFECTS ON ELIGIBILITY FOR, AND
AMOUNT OF, BENEFITS WHEN SPOUSE OR PARENT OF BENEFICIARY
IS ABSENT FROM THE HOUSEHOLD DUE TO ACTIVE MILITARY
SERVICE.
(a) Absent Person Generally Deemed To Be Living in the Household.--
Section 1614(f) (42 U.S.C. 1382c(f)) is amended by adding at the end
the following:
``(4) For purposes of paragraphs (1) and (2), a spouse or parent
(or spouse of such a parent) who is absent from the household in which
the individual lives due solely to a duty assignment as a member of the
Armed Forces on active duty shall, in the absence of evidence to the
contrary, be deemed to be living in the same household as the
individual.''.
(b) Exclusion From Income of Hazardous Duty Pay Received While in
Active Military Service.--Section 1612(b) (42 U.S.C. 1382a(b)) is
amended--
(1) in paragraph (18), by striking ``and'' the 2nd place
such term appears;
(2) in paragraph (19), by striking the period and inserting
``; and''; and
(3) by adding at the end the following:
``(20) special pay received pursuant to section 310 of
title 37, United States Code.''.
(c) Effective Date.--The amendments made by this section shall take
effect on the 1st day of the 2nd month that begins after the date of
the enactment of this Act.
SEC. 13254. ELIGIBILITY FOR CHILDREN OF ARMED FORCES PERSONNEL RESIDING
OUTSIDE THE UNITED STATES OTHER THAN IN FOREIGN
COUNTRIES.
(a) In General.--Section 1614(a)(1)(B)(ii) (42 U.S.C.
1382c(a)(1)(B)(ii)) is amended by striking ``the District of Columbia''
and all that follows to the period and inserting ``and who, for the
month before the parent reported for such assignment, received a
benefit under this title''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect on October 1, 1993.
SEC. 13255. DEFINITION OF DISABILITY FOR CHILDREN UNDER AGE 18 APPLIED
TO ALL INDIVIDUALS UNDER AGE 18.
(a) In General.--Section 1614(a)(3)(A) (42 U.S.C. 1382c(a)(3)(A))
is amended by striking ``a child'' and inserting ``an individual''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to determinations made on or after the date of the enactment of
this Act.
SEC. 13256. VALUATION OF CERTAIN IN-KIND SUPPORT AND MAINTENANCE WHEN
THERE IS A COST OF LIVING ADJUSTMENT IN BENEFITS.
(a) In General.--Section 1611(c) (42 U.S.C. 1382(c)) is amended--
(1) in paragraph (1), by striking ``and (5)'' and inserting
``(5), and (6)''; and
(2) by redesignating paragraphs (6) and (7) as paragraphs
(7) and (8), respectively; and
(3) by inserting after paragraph (5) the following:
``(6) The dollar amount in effect under subsection (b) as a result
of any increase in benefits under this title by reason of section 1617
shall be used to determine the value of any in-kind support and
maintenance required to be taken into account in determining the
benefit payable under this title to an individual (and the eligible
spouse, if any, of the individual) for the 1st 2 months for which the
increase in benefits applies.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to benefits paid for months after the calendar year 1993.
SEC. 13257. EXCLUSION FROM INCOME OF CERTAIN AMOUNTS RECEIVED BY
INDIANS FROM INTERESTS HELD IN TRUST.
(a) In General.--Section 8 of the Act of October 19, 1973, (25
U.S.C. 1408) is amended by inserting ``, and the first $2,000 per year
of income received by individual Indians that is derived from such
interests shall not be considered income,'' after ``resource''.
(b) Effective Date.--The amendment made by this section shall take
effect on January 1, 1993.
CHAPTER 4--AID TO FAMILIES WITH DEPENDENT CHILDREN
SEC. 13261. 50 PERCENT FEDERAL MATCH OF STATE ADMINISTRATIVE COSTS.
(a) In General.--Section 403(a)(3) (42 U.S.C. 603(a)(3)) is amended
by striking ``the sum of'' and all that follows through the end of
subparagraph (D) and inserting ``50 percent of the total amounts
expended during such quarter as the Secretary has found necessary for
the proper and efficient administration of the State plan (including
any amounts expended by the State to carry out initial evaluations
under section 486(a)),''.
(b) Optional Use of Certain Procedures To Verify Immigration Status
of AFDC Applicants.--Section 1137(d) (42 U.S.C. 1320b-7(d)) is
amended--
(1) in each of paragraphs (3) and (4)(B)(i), by inserting
``(or, in the case of the program specified in subsection
(b)(1), may)'' after ``shall''; and
(2) in paragraph (4), by inserting ``(if required)'' after
``verified''.
(c) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to payments made
for calendar quarters beginning on or after April 1, 1994.
(2) Delayed applicability to certain states.--
(A) In general.--The Secretary of Health and Human
Services may delay the applicability to a qualified
State of the amendments made by subsection (a) until
the 1st calendar quarter that begins after the close of
the 1st regular session of the State legislature that
begins after the date of the enactment of this section.
(B) Qualified state defined.--As used in
subparagraph (A), the term ``qualified State'' means a
State that meets such criteria as the Secretary shall
establish and apply uniformly, including whether the
State legislature meets biennially and does not have a
regular session scheduled in calendar year 1994.
SEC. 13262. DELAY IN EFFECTIVE DATE OF PENALTY FOR FAILURE TO MEET
REQUIRED PARTICIPATION RATE FOR UNEMPLOYED PARENTS IN THE
JOBS PROGRAM.
Section 403(l)(4)(B) (42 U.S.C. 603(l)(4)(B)) is amended--
(1) in clause (i), by striking ``1994'' and inserting
``1995'';
(2) in clause (ii), by striking ``1995'' and inserting
``1996'';
(3) in clause (iii), by striking ``1996'' and inserting
``1997''; and
(4) in clause (iv), by striking ``1997 and 1998'' and
inserting ``1998 and 1999''.
SEC. 13263. REPORT TO THE CONGRESS WITH RESPECT TO PERFORMANCE
STANDARDS IN THE JOBS PROGRAM.
Section 487(a) (42 U.S.C. 687(a)) is amended--
(1) by striking ``3'' and inserting ``4'';
(2) in paragraph (1), by inserting ``criteria for'' after
``develop'';
(3) in paragraph (2), by striking ``for'' and inserting
``with respect to''; and
(4) in the 2nd sentence, by striking ``under this
subsection'' and inserting ``with respect to the program under
this part''.
SEC. 13264. MEASUREMENT AND REPORTING OF WELFARE PARTICIPATION.
(a) Congressional Policy.--The Congress hereby declares that--
(1) it is the policy and responsibility of the Federal
Government to reduce the rate at which, and the degree to
which, families depend on income from welfare programs, and the
duration of welfare participation, to assist families toward
self-sufficiency, and to increase the living standards of low-
income families, consistent with other essential national
goals;
(2) it is the policy of the United States to strengthen
families and improve the life prospects of their children, to
ensure that children grow up in families that are economically
self-sufficient, and to underscore the responsibility of
parents to support their children;
(3) the Federal Government should help welfare recipients
as well as individuals at risk of welfare participation to
improve their education and job skills, to obtain access to
high quality child care and other necessary support services,
and to take such other steps as may assist them to meet their
responsibilities to become financially independent; and
(4) it is the purpose of this section to provide the public
with generally accepted measures of welfare participation so
that the public can track such participation over time and
determine whether progress is being made in reducing the rate
at which, and the degree to which, families depend on income
from welfare programs, and the duration of welfare
participation.
(b) Development of Welfare Participation Measures and Predictors.--
(1) In general.--The Secretary of Health and Human Services
(in this section referred to as the ``Secretary'') in
consultation with the Secretary of Agriculture shall develop--
(A) measures of--
(i) the rate at which, and the degree to
which, families depend on income from welfare
programs; and
(ii) the duration of welfare participation;
and
(B) predictors of welfare participation.
(2) Interim report.--Not later than 2 years after the date
of the enactment of this section, the Secretary shall provide
an interim report containing conclusions resulting from such
development, to--
(A) the Committee on Ways and Means of the House of
Representatives;
(B) the Committee on Education and Labor of the
House of Representatives;
(C) the Committee on Agriculture of the House of
Representatives;
(D) the Committee on Energy and Commerce of the
House of Representatives;
(E) the Committee on Finance of the Senate;
(F) the Committee on Labor and Human Resources of
the Senate; and
(G) the Committee on Agriculture, Nutrition, and
Forestry of the Senate.
(c) Advisory Board on Welfare Participation.--
(1) Establishment.--There is established an Advisory Board
on Welfare Participation (in this section referred to as the
``Board'').
(2) Composition.--The Board shall be composed of 12 members
with equal numbers to be appointed by the House of
Representatives, the Senate, and the President. The Board shall
be composed of experts in the fields of welfare research and
statistical methodology, representatives of State and local
welfare agencies, and organizations concerned with welfare
issues.
(3) Vacancies.--Any vacancy occurring in the membership of
the Board shall be filled in the same manner as the original
appointment for the position being vacated. The vacancy shall
not affect the power of the remaining members to execute the
duties of the Board.
(4) Duties.--Duties of the Board shall include--
(A) providing advice and recommendations to the
Secretary on the development of measures of the rate at
which, and the degree to which, families depend on
income from welfare programs, and the duration of
welfare participation; and
(B) providing advice on the development and
presentation of the report required by subsection (d).
(5) Travel expenses.--Members of the Board shall not be
compensated, but shall receive travel expenses, including per
diem in lieu of subsistence, at rates authorized for employees
of agencies under subchapter I of chapter 57 of title 5, United
States Code, for each day the member is engaged in the
performance of duties away from the home or regular place of
business of the member.
(6) Detail of federal employees.--The Secretary shall
detail, without reimbursement, any of the personnel of the
Department of Health and Human Services to the Board to assist
the Board in carrying out its duties. Any detail shall not
interrupt or otherwise affect the civil service status or
privileges of the Federal employee.
(7) Voluntary service.--Notwithstanding section 1342 of
title 31, United States Code, the Board may accept the
voluntary services provided by a member of the Board.
(8) Termination of board.--The Board shall be terminated at
such time as the Secretary determines the duties described in
subsection (c)(4) have been completed, but in any case prior to
the submission of the 1st report required by subsection (d).
(d) Annual Welfare Participation Reports.--
(1) Preparation.--The Secretary shall prepare annual
reports on welfare participation in the United States.
(2) Coverage.--The report shall include analysis of
families and individuals receiving assistance under means-
tested benefit programs, including the program of aid to
families with dependent children under part A of title IV of
the Social Security Act (42 U.S.C. 601 et seq.), the food stamp
program under the Food Stamp Act of 1977 (7 U.S.C. 2011 et
seq.), and the supplemental security income program under title
XVI of the Social Security Act (42 U.S.C. 1381 et seq.), or as
general assistance under programs administered by State and
local governments.
(3) Contents.--Each such report shall set forth, for each
means-tested benefit program described in paragraph (2)--
(A) measures of--
(i) the rate at which, and the degree to
which, families depend on income from welfare
programs; and
(ii) the duration of welfare participation;
(B) trends in the measures;
(C) predictors of welfare participation;
(D) the causes of welfare participation;
(E) patterns of multiple program participation;
(F) such other information as the Secretary deems
relevant; and
(G) such recommendations for legislation, which
shall not include proposals to reduce eligibility
levels or impose barriers to program access, as the
Secretary may determine to be necessary or desirable to
reduce--
(i) the rate at which, and the degree to
which, families depend on income from welfare
programs; and
(ii) the duration of welfare participation.
(4) Submission.--The Secretary shall submit such reports
not later than 3 years after the date of the enactment of this
section, and annually thereafter, to the committees specified
in subsection (b)(2). Each such report shall be transmitted
during the 1st 60 days of each regular session of the Congress.
SEC. 13265. NEW HOPE DEMONSTRATION PROJECT.
(a) In General.--The Secretary of Health and Human Services (in
this section referred to as the ``Secretary'') shall provide for a
demonstration project for a qualified program to be conducted in
Milwaukee, Wisconsin, in accordance with this section.
(b) Payments.--For each calendar quarter in which there is a
qualified program approved under this subsection, the Secretary shall
pay to the operator of the qualified program, for no more than 20
calendar quarters, an amount equal to the aggregate amount that would
otherwise have been payable to the State with respect to participants
in the program for such calendar quarter, in the absence of the
program, for cash assistance and child care under part A of title IV of
the Social Security Act and for administrative expenses related to such
assistance. In calculating the amount of such payment, the expenses of
the program incurred in evaluating the effects of the program may be
treated as amounts necessary for the proper and efficient
administration of the program, for purposes of part A of title IV of
such Act.
(c) Demonstration Project Described.--For purposes of this section,
the term ``qualified program'' means a program operated--
(1) by The New Hope Project, Inc., a private, not-for-
profit corporation incorporated under the laws of the State of
Wisconsin (in this section referred to as the ``operator''),
which offers low-income residents of Milwaukee, Wisconsin,
employment, wage supplements, child care, health care, and
counseling and training for job retention or advancement; and
(2) in accordance with an application submitted by the
operator of the program and approved by the Secretary based on
the Secretary's determination that the application satisfies
the requirements of subsection (d).
(d) Contents of Application.--The operator of the qualified program
shall provide, in its application to conduct a demonstration project
for the program, that the following terms and conditions will be met:
(1) The operator will develop and implement an evaluation
plan designed to provide reliable information on the impact and
implementation of the program. The evaluation plan will include
adequately sized groups of project participants and control
groups assigned at random.
(2) The operator will develop and implement a plan
addressing the services and assistance to be provided by the
program, the timing and determination of payments from the
Secretary to the operator of the program, and the roles and
responsibilities of the Secretary and the operator with respect
to meeting the requirements of this paragraph.
(3) The operator will specify a methodology for determining
expenditures to be paid to the operator by the Secretary, with
assistance from the Secretary in calculating the amount that
would otherwise have been payable to the State in the absence
of the program, pursuant to subsection (b).
(4) The operator will issue an interim and final report on
the results of the evaluation described in paragraph (1) to the
Secretary at such times as required by the Secretary.
(e) Effective Date.--This section shall take effect on the 1st day
of the 1st calendar quarter that begins after the date of enactment of
this Act.
SEC. 13266. DELAY IN REQUIREMENT THAT OUTLYING AREAS OPERATE AN AFDC-UP
PROGRAM.
Section 401(g)(2) of the Family Support Act of 1988 (42 U.S.C. 602
note; 102 Stat. 2396) is amended by striking ``October 1, 1992'' and
inserting ``the date of the repeal of the limitations contained in
section 1108(a) of the Social Security Act on payments to such
jurisdictions for purposes of making maintenance payments under parts A
and E of title IV of such Act''.
SEC. 13267. ADULT IN FAMILY OR HOUSEHOLD ALLOWED TO ATTEST TO
CITIZENSHIP STATUS OF FAMILY OR HOUSEHOLD MEMBERS.
(a) In General.--Section 1137(d)(1)(A) (42 U.S.C. 1320b-7(d)(1)(A))
is amended--
(1) by inserting ``(i)'' after ``(1)(A)'';
(2) by inserting ``(other than the aid to families with
dependent children program under part A of title IV of this
Act)'' after ``any program listed in subsection (b)''; and
(3) by adding at the end the following:
``(ii) The State shall require, as a condition of an
individual's eligibility for benefits under the aid to families
with dependent children program under part A of title IV of
this Act, a declaration in writing, under penalty of perjury--
``(I) in the case of an individual who is an adult
member of a family or household applying for or
receiving such benefits, by such individual or another
adult member of such family or household on such
individual's behalf;
``(II) in the case of an individual who is a child,
by an adult on the individual's behalf; or
``(III) in the case of an individual born into a
family or household receiving such benefits, by an
adult member of such individual's family or household
on the individual's behalf no later than the next
redetermination of eligibility of such family or
household following the birth of such individual,
stating whether the individual is a citizen or national of the
United States, and, if that individual is not a citizen or
national of the United States, that the individual is in a
satisfactory immigration status.''.
(b) Effective Date.--The amendments made by subsection (a) shall
become effective with respect to benefits provided on or after October
1, 1993.
SEC. 13268. INCREASE IN STEPPARENT INCOME DISREGARD.
(a) In General.--Section 402(a)(31) (42 U.S.C. 602(a)(31)) is
amended by striking ``$75'' and inserting ``$90''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect on October 1, 1993, and shall apply to payments under part
A of title IV of the Social Security Act for fiscal year 1994 and such
payments for succeeding fiscal years.
SEC. 13269. EXTENSION OF NEW YORK STATE CHILD SUPPORT DEMONSTRATION
PROGRAM.
Section 9122(g)(1) of the Omnibus Budget Reconciliation Act of 1987
(42 U.S.C. 602 note; 101 Stat. 1330-312) is amended by striking
``five'' and inserting ``10''.
SEC. 13270. EARLY CHILDHOOD DEVELOPMENT PROJECTS.
Section 501(a) of the Family Support Act of 1988 (42 U.S.C. 1315
note; 102 Stat. 2400) is amended by adding at the end the following:
``(4) For grants to States to conduct demonstration projects under
this subsection, there are authorized to be appropriated not to exceed
$3,000,000 for each of the fiscal years 1994 through 1998.''.
CHAPTER 5--UNEMPLOYMENT INSURANCE
SEC. 13271. TREATMENT OF SHORT-TIME COMPENSATION PROGRAMS.
(a) General Rule.--Section 3306 of the Internal Revenue Code of
1986 is amended by adding at the end thereof the following new
subsection:
``(t) Short-Time Compensation Program.--For purposes of this
chapter, the term `short-time compensation program' means a program
under which--
``(1) individuals whose workweeks have been reduced by at
least 10 percent are eligible for unemployment compensation;
``(2) the amount of unemployment compensation payable to
any such individual is a pro rata portion of the unemployment
compensation which would be payable to the individual if the
individual were totally unemployed;
``(3) eligible employees are not required to meet the
availability for work or work search test requirements while
collecting short-time compensation benefits, but are required
to be available for their normal workweek;
``(4) eligible employees may participate in an employer-
sponsored training program to enhance jobs skills if such
program has been approved by the State agency;
``(5) there is a reduction in the number of hours worked by
employees in lieu of temporary layoffs;
``(6) there is a plan of an employer (or an employers
association which is party to a collective bargaining
agreement) approved by the State agency consisting of factors
in this subsection or other factors as the Secretary of Labor
may find relevant; and
``(7) the employer continues to provide health benefits and
pension benefits under a pension plan (as defined in section
3(35) of the Employee Retirement Income Security Act of 1974)
to any employee whose workweek is reduced under such plan.
A short-time compensation program may also contain such other factors
as the Secretary of Labor finds relevant.''.
(b) Conforming Amendments.--
(1) Subparagraph (E) of section 3304(a)(4) of such Code is
amended to read as follows:
``(E) amounts may be withdrawn for the payment of
short-time compensation under a short-time compensation
program approved by the Secretary of Labor:''.
(2) Paragraph (4) of section 3306(f) of such Code is
amended to read as follows:
``(4) amounts may be withdrawn for the payment of short-
time compensation under a short-time compensation program
approved by the Secretary of Labor.''.
(3) Section 303(a)(5) of the Social Security Act is amended
by striking ``the payment of short-time compensation under a
plan approved by the Secretary of Labor'' and inserting ``the
payment of short-time compensation under a short-time
compensation program (as defined in section 3306(t) of the
Internal Revenue Code of 1986) approved by the Secretary of
Labor''.
SEC. 13272. TECHNICAL AMENDMENT TO UNEMPLOYMENT TRUST FUND.
Paragraph (1) of section 905(b) of the Social Security Act is
amended to read as follows:
``(b)(1) Except as provided in paragraph (3), the Secretary of the
Treasury shall transfer (as of the close of each month), from the
employment security administration account to the extended unemployment
compensation account established by subsection (a), an amount equal to
20 percent of the amount by which--
``(A) the transfers to such account pursuant to section
901(b)(2) during such month, exceed
``(B) the payments during such month from the employment
security administration account pursuant to section 901(b)(3)
and (d).
If for any month the payments referred to in subparagraph (B) exceed
the transfers referred to in subparagraph (A), proper adjustments shall
be made in the amounts subsequently transferred.''.
SEC. 13273. EXTENSION OF REPORTING DATE FOR ADVISORY COUNCIL.
In the case of the first Advisory Council on Unemployment
Compensation established under section 908 of the Social Security Act,
subsection (f) of such section 908 shall be applied--
(1) by substituting ``3rd year'' for ``2d year'' in
paragraph (1), and
(2) by substituting ``February 1, 1995'' for ``February 1,
1994'' in paragraph (2).
SEC. 13274. CLARIFICATION OF EMERGENCY UNEMPLOYMENT BENEFITS
PROVISIONS.
(a) In General.--Subclauses (II) and (III) of section
102(b)(2)(A)(v) of the Emergency Unemployment Compensation Act of 1991
are amended to read as follows:
``(II) The requirements of this
subclause are met for any week if the
national rate of total unemployment
(seasonally adjusted) for each of the 2
most recent calendar months (not
averaged) for which data are published
before the close of such week is less
than 7 percent, and if the requirements
of subclause (III) are not met for such
week.
``(III) The requirements of this
subclause are met for any week if the
national rate of total unemployment
(seasonally adjusted) for each of the 2
most recent calendar months (not
averaged) for which data are published
before the close of such week is less
than 6.8 percent.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply as if included in the amendments made by section 101(b) of the
Unemployment Compensation Amendments of 1992.
SEC. 13275. MODIFICATIONS TO EXTENDED UNEMPLOYMENT PROGRAM.
(a) Increase in Reimbursement Rate.--Subsection (a) of section 204
of the Federal-State Extended Unemployment Compensation Act of 1970 is
amended by striking ``one-half'' and inserting ``75 percent''.
(b) Repeal of Special Eligibility Requirements.--Subsection (a) of
section 202 of such Act is amended--
(1) by striking paragraphs (3), (4), and (7),
(2) by redesignating paragraphs (5) and (6) as paragraphs
(3) and (4), respectively, and
(3) by striking ``paragraphs (3), (4), and (5)'' in
paragraph (4) (as redesignated by paragraph (1) of this
subsection) and inserting ``paragraph (3)''.
(c) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to weeks beginning after October 2, 1993.
(2) Special rule.--In the case of any State the legislature
of which has not been in session for at least 30 calendar days
(whether or not successive) between the date of the enactment
of this Act and October 1, 1993, the amendment made by
subsection (b) shall not be a requirement of the State law of
such State before the date 30 calendar days after the 1st day
on which such legislature is in session on or after October 1,
1993.
SEC. 13276. EXTENSION OF CURRENT FEDERAL UNEMPLOYMENT RATE.
Section 3301 of the Internal Revenue Code of 1986 is amended--
(1) by striking ``1996'' in paragraph (1) and inserting
``1998'', and
(2) by striking ``1997'' in paragraph (2) and inserting
``1999''.
SEC. 13277. DISCLOSURE OF INFORMATION TO RAILROAD RETIREMENT BOARD.
Section 6103(l)(1)(C) of the Internal Revenue Code of 1986 is
amended to read as follows:
``(C) taxes imposed by chapters 22 and 23A, to the
Railroad Retirement Board for purposes of its
administration of the Railroad Retirement and Railroad
Unemployment Insurance Acts.''.
CHAPTER 6--TECHNICAL PROVISIONS
SEC. 13281. CORRECTIONS RELATED TO THE INCOME SECURITY AND HUMAN
RESOURCES PROVISIONS OF THE OMNIBUS BUDGET RECONCILIATION
ACT OF 1990.
(a) Amendment Related to Section 5035(a)(2).--Section 5035(a)(2) of
the Omnibus Budget Reconciliation Act of 1990 (Public Law 101-508) is
amended by striking ``a semicolon'' and inserting ```; and'''.
(b) Repeal of Provision Inadvertently Included.--Section 5057 of
the Omnibus Budget Reconciliation Act of 1990 (Public Law 101-508), and
the amendment made by such section, are hereby repealed, and section
1139(d) of the Social Security Act shall be applied and administered as
if such section 5057 had never been enacted.
(c) Amendment Related to Section 5105(d)(1)(B).--Section
5105(d)(1)(B) of the Omnibus Budget Reconciliation Act of 1990 (Public
Law 101-508; 104 Stat. 1388-266) is amended to read as follows:
``(B) Title xvi.--Section 1631(a)(2)(F) (42 U.S.C.
1383(a)(2)(F)), as so redesignated by subsection (c)(2)
of this section, is amended to read as follows:
```(F) The Secretary shall include as a part of the annual report
required under section 704 information with respect to the
implementation of the preceding provisions of this paragraph,
including--
```(i) the number of cases in which the representative
payee was changed;
```(ii) the number of cases discovered where there has been
a misuse of funds;
```(iii) how any such cases were dealt with by the
Secretary;
```(iv) the final disposition of such cases (including any
criminal penalties imposed); and
```(v) such other information as the Secretary determines
to be appropriate.'.''.
(d) Amendment Related to Section 5105(a)(1)(B).--The 2nd paragraph
of section 1631(a) (42 U.S.C. 1383(a)) is amended by striking ``(A)(i)
Payments'' and inserting ``(2)(A)(i) Payments''.
(e) Amendments Related to Section 5105(b).--Section 1631(a)(2)(C)
(42 U.S.C. 1383(a)(2)(C)) is amended--
(1) by striking clause (ii);
(2) by redesignating clauses (iii), (iv), and (v) as
clauses (ii), (iii), and (iv), respectively; and
(3) in clause (iv) (as so redesignated), by striking
``(iii), and (iv)'' and inserting ``and (iii)''.
(f) Amendments Related to Section 5107(a)(2)(B).--Section
1631(c)(1)(B) (42 U.S.C. 1383(c)(1)(B)) is amended by striking
``paragraph (1)'' each place such term appears and inserting
``subparagraph (A)''.
(g) Amendment Related to Section 5109(a)(2).--Section 1631 (42
U.S.C. 1383) is amended by redesignating the subsection (n) added by
section 5109(a)(2) of the Omnibus Budget Reconciliation Act of 1990, as
subsection (o).
(h) Amendments Related to Section 11115(b)(2).--Section 11115(b)(2)
of the Omnibus Budget Reconciliation Act of 1990 (Public Law 101-508)
is amended--
(1) in subparagraph (A), by striking ``paragraph (8)'' and
inserting ``paragraph (9)'';
(2) in subparagraph (B), by striking ``paragraph (9)'' and
inserting ``paragraph (10)''; and
(3) in subparagraph (C), by redesignating the new paragraph
added thereby as paragraph (11).
(i) Amendment Related to Section 13101(d)(2).--Section 256(k)(2)(A)
of the Balanced Budget and Emergency Deficit Control Act of 1985 is
amended--
(1) by striking ``--'' the 2nd place it appears and all
that follows through ``(I)''; and
(2) by striking ``; or'' and all that follows through
``(II)'' and inserting ``, except that a State may not be
allotted an amount under this subparagraph that exceeds''.
(j) Effective Date.--Each amendment made by this section shall take
effect as if included in the provision of the Omnibus Budget
Reconciliation Act of 1990 to which the amendment relates at the time
such provision became law.
SEC. 13282. TECHNICAL CORRECTIONS RELATED TO THE HUMAN RESOURCE AND
INCOME SECURITY PROVISIONS OF THE OMNIBUS BUDGET
RECONCILIATION ACT OF 1989.
(a) Amendment Relating to Section 8004(a).--Section 408(m)(2)(A)
(42 U.S.C. 608(m)(2)(A)) is amended by striking ``a fiscal'' and
inserting ``the fiscal''.
(b) Amendment Relating to Section 8006(a).--Section 473(a)(6)(B)
(42 U.S.C. 673(a)(6)(B)) is amended by striking ``474(a)(3)(B)'' and
inserting ``474(a)(3)(C)''.
(c) Amendment Relating to Section 8007(b)(3).--Subparagraph (D) of
section 475(5) (42 U.S.C. 675(5)(D)) is amended by moving such
subparagraph 2 ems to the right so that the left margin of such
subparagraph is aligned with the left margin of subparagraph (C) of
such section.
(d) Effective Date.--Each amendment made by this section shall take
effect as if the amendment had been included in the provision of the
Omnibus Budget Reconciliation Act of 1989 to which the amendment
relates, at the time the provision became law.
SEC. 13283. ELIMINATION OF OBSOLETE PROVISIONS RELATING TO TREATMENT OF
THE EARNED INCOME TAX CREDIT.
(a) Treatment of EITC as Earned Income.--Section 1612(a)(1) (42
U.S.C. 1382a(a)(1)) is amended by striking subparagraph (C) and by
redesignating subparagraphs (D) and (E) as subparagraphs (C) and (D),
respectively.
(b) Adjustment of Benefits Due to Treatment of EITC as Earned
Income.--Section 1631(b) (42 U.S.C. 1383(b)) is amended by striking
paragraph (3) and by redesignating paragraphs (4) and (5) as paragraphs
(3) and (4), respectively.
SEC. 13284. REDESIGNATION OF CERTAIN PROVISIONS.
Section 1631(e)(6) (42 U.S.C. 1383(e)(6)) is amended by
redesignating subparagraphs (1) and (2) as subparagraphs (A) and (B),
respectively.
Subtitle C--Medicare Program
SEC. 13400. REFERENCES IN SUBTITLE; TABLE OF CONTENTS OF SUBTITLE.
(a) Amendments to Social Security Act.--Except as otherwise
specifically provided, whenever in this subtitle an amendment is
expressed in terms of an amendment to or repeal of a section or other
provision, the reference shall be considered to be made to that section
or other provision of the Social Security Act.
(b) References to OBRA.--In this subtitle, the terms ``OBRA-1986'',
``OBRA-1987'', ``OBRA-1989'', and ``OBRA-1990'' refer to the Omnibus
Budget Reconciliation Act of 1986 (Public Law 99-509), the Omnibus
Budget Reconciliation Act of 1987 (Public Law 100-203), the Omnibus
Budget Reconciliation Act of 1989 (Public Law 101-239), and the Omnibus
Budget Reconciliation Act of 1990 (Public Law 101-508), respectively.
(c) Table of Contents of Subtitle.--The table of contents of this
subtitle is as follows:
Sec. 13400. References in subtitle; table of contents of subtitle.
subchapter a--elimination of inflation update for services provided
under part a
Sec. 13401. Inpatient hospital services and hospice care.
Sec. 13402. Limits on per diem routine service costs for extended care
subchapter b--other provisions relating to part a
Sec. 13411. Wage index provisions.
Sec. 13412. Transition for hospital outlier thresholds.
Sec. 13413. Essential access community hospital (EACH) amendments.
Sec. 13414. Rural health transition grant program extension.
Sec. 13415. Regional referral center extension.
Sec. 13416. Medicare-dependent, small rural hospital payment extension.
Sec. 13417. Extension of regional floor.
Sec. 13418. Extension of rural hospital demonstration.
Sec. 13419. Hemophilia pass-through extension.
Sec. 13420. State hospital payment programs.
Sec. 13421. Psychology services in hospitals.
Sec. 13422. Graduate medical education payments in hospital-owned
community health centers.
Sec. 13423. Treatment of certain military facilities.
Sec. 13424. Epilepsy DRG.
Sec. 13425. Skilled nursing facility wage index.
Sec. 13426. Hospice notification to beneficiaries.
Sec. 13427. Reduction in part A premium for certain individuals with 30
or more quarters of Social Security
coverage.
Sec. 13428. Periodic updates to salary equivalency guidelines for
physical therapy and respiratory therapy
services.
Sec. 13429. Extension of deadline for application for geographic
classification for certain reclassified
hospitals.
Sec. 13430. Clarification of DRG payment window expansion;
miscellaneous and technical corrections.
subchapter a--elimination of inflation update
Sec. 13431. Elimination of inflation update for physician and related
professional services.
Sec. 13432. Elimination of cost-of-living adjustments for certain items
and services.
Sec. 13433. Ambulatory surgical center services.
Sec. 13434. Other isubchapter b--physicians' services
Sec. 13441. Reinstating separate payment for the interpretation of
electrocardiograms (EKGs).
Sec. 13442. Payments for new physicians and practitioners.
Sec. 13443. Retaining payment for actual anesthesia time.
Sec. 13444. Geographic cost of practice index refinements.
Sec. 13445. Extra-billing.
Sec. 13446. Relative values for pediatric services.
Sec. 13447. Antigens under physician fee schedule.
Sec. 13448. Administration of claims relating to physicians' services.
Sec. 13449.subchapter c--ambulatory surgical center services
Sec. 13451. Designation of certain hospitals as eye or eye and ear
hospitals.
Sec. 13452. Treatment of intraocular lenses.
Sec. 13453. Techsubchapter d--durable medical equipment
Sec. 13461. Certification of suppliers.
Sec. 13462. Prohibition against carrier forum shopping.
Sec. 13463. Restrictions on certain marketing and sales activities.
Sec. 13464. Anti-kickback clarification.
Sec. 13465. Limitations on beneficiary liability for noncovered
services.
Sec. 13466. Adjustments for inherent reasonableness.
Sec. 13467. Treatment of nebulizers and aspirators.
Sec. 13468. Payment for ostomy supplies and other supplies.
Sec. 13469. Miscellansubchapter e--other provisions.
Sec. 13471. Clarifying payments for medically directed certified
registered nurse anesthetist services.
Sec. 13472. Extension of Alzheimer's disease demonstration projects.
Sec. 13473. Oral cancer drugs.
Sec. 13474. Part B premium for late enrollment.
Sec. 13475. Coverage of services of speech-language pathologists and
audiologists.
Sec. 13476. Extension of municipal health service demonstration
projects.
Sec. 13477. Treatment of certain Indian health programs and facilities
as Federally-qualified health centers.
Sec. 13478. Miscellanesubchapter f--part b premiums.
Sec. 13481. Part B premium.
Chaptesubchapter a--elimination of updatesand B
Sec. 13501. Elimination of cost-of-living update in per resident
amounts for direct medical education.
Sec. 13502. Elimination of inflation update in cost limits for home
subchapter b--medicare secondary payer provisions
Sec. 13511. Extension of transfer of data.
Sec. 13512. 3-year extension of medicare secondary payer to disabled
beneficiaries.
Sec. 13513. 3-year extension of 18-month rule for ESRD beneficiaries.
Sec. 13514. Msubchapter c--physician ownership and referral
Sec. 13521. Application of medicare ban on self-referrals to all
payers.
Sec. 13522. Extension of self-referral ban to additional specified
services.
Sec. 13523. Exceptions for both ownership and compensation
arrangements.
Sec. 13524. Exceptions related only to ownership or investment.
Sec. 13525. Exceptions related only to compensation arrangements.
Sec. 13526. Clarification concerning civil money penalty sanctions.
Sec. 13527. Requirements for group practice.
Sec. 13538. No Federal preemption of more restrictive State laws.
Sec. 13529. Miscellaneous provisions.
Sec. 13530. Effectivesubchapter d--other provisions
Sec. 13551. Direct graduate medical education.
Sec. 13552. Immunosuppressive drug therapy.
Sec. 13553. Reduction in payments for erythropoientin.
Sec. 13554. Qualified medicare beneficiary outreach.
Sec. 13555. Extension of social health maintenance organization
demonstrations.
Sec. 13556. Hospice notification to home health beneficiaries.
Sec. 13557. Interest payments.
Sec. 13558. Peer review organizations.
Sec. 13559. Health maintenance organizations.
Sec. 13560. Medicare administration budget process.
Sec. 13561. Other provisions.
Chapter 4--Medicare Supplemental Insurance Policies
Sec. 13571. Standards for medicare supplemental insurance policies.
Chapter 5--Treatment of Certain State Health Care Programs
Sec. 13581. Treatment of certain State health care programs.
CHAPTER 1--PROVISIONS RELATING TO PART A
Subchapter A--Elimination of Inflation Update for Services Provided
Under Part A
SEC. 13401. INPATIENT HOSPITAL SERVICES AND HOSPICE CARE.
Section 1886(b)(3)(B)(iii) (42 U.S.C. 1395ww(b)(3)(B)(iii)) is
amended--
(1) by striking ``(iii) For purposes of this subparagraph''
and inserting ``(iii)(I) Except as provided in subclause (II),
for purposes of this subparagraph'', and
(2) by adding at the end the following new subclause:
``(II) For purposes of this subparagraph and section
1814(i)(1)(C)(ii), the `market basket percentage increase', with
respect to cost reporting periods and discharges occurring in fiscal
year 1994 or 1995, is 0 percent.''.
SEC. 13402. LIMITS ON PER DIEM ROUTINE SERVICE COSTS FOR EXTENDED CARE
SERVICES.
The Secretary of Health and Human Services shall not provide for
any increase, on the basis of inflation or changes in the cost of goods
and services, in the limits on per diem routine service costs for
extended care services under section 1888 of the Social Security Act
for cost reporting periods beginning during fiscal year 1994 or fiscal
year 1995.
Subchapter B--Other Provisions Relating to Part A
SEC. 13411. WAGE INDEX PROVISIONS.
(a) Wage Index Hold Harmless Protection.--
(1) In general.--Section 1886(d)(8)(C) (42 U.S.C.
1395ww(d)(8)(C)) is amended by adding at the end the following
new clause:
``(iv) The application of subparagraph (B) or a decision of the
Medicare Geographic Classification Review Board or the Secretary under
paragraph (1) may not result in a reduction in an urban area's wage
index if--
``(I) the urban area has a wage index below the wage index
for rural areas in the State in which it is located; or
``(II) the urban area is located in a State that is
composed of a single urban area.''.
(2) No standardized amount adjustment.--The Secretary of
Health and Human Services shall not revise the fiscal year 1992
or fiscal year 1993 standardized amounts pursuant to
subsections (d)(3)(B) and (d)(8)(D) of section 1886 of the
Social Security Act to account for the amendment made by
paragraph (1).
(3) Effective date.--The amendment made by paragraph (1)
shall apply to discharges occurring--
(A) on or after October 1, 1991, in the case of
hospitals located in an urban area described in section
1886(d)(8)(C)(iv)(I) of the Social Security Act (as
added by paragraph (1)); and
(B) on or after the date of the enactment of this
Act, in the case of hospitals located in an urban area
described in section 1886(d)(8)(C)(iv)(II) of the
Social Security Act (as added by paragraph (1)).
(b) Updating Standards for Treating Rural Counties as Urban
Counties Based on Rates of Commutation.--
(1) In general.--Section 1886(d)(8)(B) (42 U.S.C.
1395ww(d)(8)(B)) is amended--
(A) by striking ``standards'' each place it appears
and inserting ``standards most recently used'', and
(B) by striking ``published in the Federal Register
on January 3, 1980''.
(2) Hold harmless for counties currently treated as
urban.--Any hospital that is treated as being located in an
urban metropolitan statistical area pursuant to section
1886(d)(8)(B) of the Social Security Act as of September 30,
1992, shall continue to be so treated notwithstanding the
amendments made by paragraph (1).
(3) Effective date.--The amendments made by paragraph (1)
shall be effective on October 1, 1993.
(c) Use of Occupational Mix in Guidelines.--
(1) In general.--Section 1886(d)(10)(D)(i)(I) (42 U.S.C.
1395ww(d)(10)(D)(i)(I)) is amended by inserting ``(to the
extent the Secretary determines appropriate)'' after ``taking
into account''.
(2) Effective date.--The amendment made by paragraph (1)
shall take effect as if included in the enactment of OBRA-1989.
SEC. 13412. TRANSITION FOR HOSPITAL OUTLIER THRESHOLDS.
Section 1886(d)(5)(A) (42 U.S.C. 1395ww(d)(5)(A)) is amended--
(1) in clause (i), by striking ``The Secretary'' and
inserting ``For discharges occurring during fiscal years ending
on or before September 30, 1997, the Secretary''; and
(2) by adding at the end the following new clauses:
``(v) The Secretary shall provide that--
``(I) the day outlier percentage for fiscal year 1995 shall
be 75 percent of the day outlier percentage for fiscal year
1994;
``(II) the day outlier percentage for fiscal year 1996
shall be 50 percent of the day outlier percentage for fiscal
year 1994; and
``(III) the day outlier percentage for fiscal year 1997
shall be 25 percent of the day outlier percentage for fiscal
year 1994.
``(vi) For purposes of this subparagraph, the term `day outlier
percentage' means, for a fiscal year, the percentage of the total
additional payments made by the Secretary under this subparagraph for
discharges in that fiscal year which are additional payments under
clause (i).''.
SEC. 13413. ESSENTIAL ACCESS COMMUNITY HOSPITAL (EACH) AMENDMENTS.
(a) Increasing Number of Participating States.--Section 1820(a)(1)
(42 U.S.C. 1395i-4(a)(1)) is amended by striking ``7'' and inserting
``9''.
(b) Treatment of Inpatient Hospital Services Provided in Rural
Primary Care Hospitals.--
(1) In general.--Section 1820(f)(1)(F) (42 U.S.C. 1395i-
4(f)(1)(F)) is amended to read as follows:
``(F) subject to paragraph (4), provides not more
than 6 inpatient beds (meeting such conditions as the
Secretary may establish) for providing inpatient care
to patients requiring stabilization before discharge or
transfer to a hospital, except that the facility may
not provide any inpatient hospital services--
``(i) to any patient whose attending
physician does not certify that the patient may
reasonably be expected to be discharged or
transferred to a hospital within 72 hours of
admission to the facility; or
``(ii) consisting of surgery or any other
service requiring the use of general anesthesia
(other than surgical procedures specified by
the Secretary under section 1833(i)(1)(A)),
unless the attending physician certifies that
the risk associated with transferring the
patient to a hospital for such services
outweighs the benefits of transferring the
patient to a hospital for such services.''.
(2) Limitation on average length of stay.--Section 1820(f)
(42 U.S.C. 1395i-4(f)) is amended by adding at the end the
following new paragraph:
``(4) Limitation on average length of inpatient stays.--The
Secretary may terminate a designation of a rural primary care
hospital under paragraph (1) if the Secretary finds that the
average length of stay for inpatients at the facility during
the previous year in which the designation was in effect
exceeded 72 hours. In determining the compliance of a facility
with the requirement of the previous sentence, there shall not
be taken into account periods of stay of inpatients in excess
of 72 hours to the extent such periods exceed 72 hours because
transfer to a hospital is precluded because of inclement
weather or other emergency conditions.''.
(3) Conforming amendment.--Section 1814(a)(8) (42 U.S.C.
1395f(a)(8)) is amended by striking ``such services'' and all
that follows and inserting ``the individual may reasonably be
expected to be discharged or transferred to a hospital within
72 hours after admission to the rural primary care hospital.''.
(4) GAO reports.--Not later than 2 years after the date of
the enactment of this Act, the Comptroller General shall submit
reports to Congress on--
(A) the application of the requirements under
section 1820(f) of the Social Security Act (as amended
by this subsection) that rural primary care hospitals
provide inpatient care only to those individuals whose
attending physicians certify may reasonably be expected
to be discharged within 72 hours after admission and
maintain an average length of inpatient stay during a
year that does not exceed 72 hours; and
(B) the extent to which such requirements have
resulted in such hospitals providing inpatient care
beyond their capabilities or have limited the ability
of such hospitals to provide needed services.
(c) Designation of Hospitals.--
(1) Permitting designation of hospitals located in urban
areas.--
(A) In general.--Section 1820 (42 U.S.C. 1395i-4)
is amended--
(i) by striking paragraph (1) of subsection
(e) and redesignating paragraphs (2) through
(6) as paragraphs (1) through (5); and
(ii) in subsection (e)(1)(A) (as
redesignated by subparagraph (A))--
(I) by striking ``is located'' and
inserting ``except in the case of a
hospital located in an urban area, is
located'',
(II) by striking ``, (ii)'' and
inserting ``or (ii)'',
(III) by striking ``or (iii)'' and
all that follows through ``section,'',
and
(IV) in subsection (i)(1)(B), by
striking ``paragraph (3)'' and
inserting ``paragraph (2)''.
(B) No change in medicare prospective payment.--
Section 1886(d)(5)(D) (42 U.S.C. 1395ww(d)(5)(D)) is
amended--
(i) in clause (iii)(III), by inserting
``located in a rural area and'' after ``that
is'', and
(ii) in clause (v), by inserting ``located
in a rural area and'' after ``in the case of a
hospital''.
(2) Permitting hospitals located in adjoining states to
participate in state program.--
(A) In general.--Section 1820 (42 U.S.C. 1395i-4)
is amended--
(i) by redesignating subsection (k) as
subsection (l); and
(ii) by inserting after subsection (j) the
following new subsection:
``(k) Eligibility of Hospitals Not Located in Participating
States.--Notwithstanding any other provision of this section--
``(1) for purposes of including a hospital or facility as a
member institution of a rural health network, a State may
designate a hospital or facility that is not located in the
State as an essential access community hospital or a rural
primary care hospital if the hospital or facility is located in
an adjoining State and is otherwise eligible for designation as
such a hospital;
``(2) the Secretary may designate a hospital or facility
that is not located in a State receiving a grant under
subsection (a)(1) as an essential access community hospital or
a rural primary care hospital if the hospital or facility is a
member institution of a rural health network of a State
receiving a grant under such subsection; and
``(3) a hospital or facility designated pursuant to this
subsection shall be eligible to receive a grant under
subsection (a)(2).''.
(B) Conforming amendments.--(i) Section 1820(c)(1)
(42 U.S.C. 1395i-4(c)(1)) is amended by striking
``paragraph (3)'' and inserting ``paragraph (3) or
subsection (k)''.
(ii) Paragraphs (1)(A) and (2)(A) of section
1820(i) (42 U.S.C. 1395i-4(i)) are each amended--
(I) in clause (i), by striking ``(a)(1)''
and inserting ``(a)(1) (except as provided in
subsection (k))'', and
(II) in clause (ii), by striking
``subparagraph (B)'' and inserting
``subparagraph (B) or subsection (k)''.
(d) Skilled Nursing Services in Rural Primary Care Hospitals.--
Section 1820(f)(3) (42 U.S.C. 1395i-4(f)(3)) is amended by striking
``because the facility'' and all that follows and inserting the
following: ``because, at the time the facility applies to the State for
designation as a rural primary care hospital, there is in effect an
agreement between the facility and the Secretary under section 1883
under which the facility's inpatient hospital facilities are used for
the furnishing of extended care services, except that the number of
beds used for the furnishing of such services may not exceed the total
number of licensed inpatient beds at the time the facility applies to
the State for such designation (minus the number of inpatient beds used
for providing inpatient care pursuant to paragraph (1)(F)). For
purposes of the previous sentence, the number of beds of the facility
used for the furnishing of extended care services shall not include any
beds of a unit of the facility that is licensed as a distinct-part
skilled nursing facility at the time the facility applies to the State
for designation as a rural primary care hospital.''.
(e) Payment for Outpatient Rural Primary Care Hospital Services.--
(1) Implementation of prospective payment system.--Section
1834(g) (42 U.S.C. 1395m(g)) is amended--
(A) in paragraph (1), by striking ``during a year
before 1993'' and inserting ``during a year before the
prospective payment system described in paragraph (2)
is in effect''; and
(B) in paragraph (2), by striking ``January 1,
1993,'' and inserting ``January 1, 1996,''.
(2) No use of customary charge in determining payment.--
Section 1834(g)(1) (42 U.S.C. 1395m(g)(1)) is amended by adding
at the end the following:
``The amount of payment shall be determined under either method
without regard to the amount of the customary or other
charge.''.
(f) Clarification of Physician Staffing Requirement for Rural
Primary Care Hospitals.--Section 1820(f)(1)(H) (42 U.S.C. 1395i-
4(f)(1)(H)) is amended by striking the period and inserting the
following: ``, except that in determining whether a facility meets the
requirements of this subparagraph, subparagraphs (E) and (F) of that
paragraph shall be applied as if any reference to a `physician' is a
reference to a physician as defined in section 1861(r)(1).''.
(g) Technical Amendments Relating to Part A Deductible,
Coinsurance, and Spell of Illness.--(1) Section 1812(a)(1) (42 U.S.C.
1395d(a)(1)) is amended--
(A) by striking ``inpatient hospital services'' the first
place it appears and inserting ``inpatient hospital services or
inpatient rural primary care hospital services'';
(B) by striking ``inpatient hospital services'' the second
place it appears and inserting ``such services''; and
(C) by striking ``and inpatient rural primary care hospital
services''.
(2) Sections 1813(a) and 1813(b)(3)(A) (42 U.S.C. 1395e(a),
1395e(b)(3)(A)) are each amended by striking ``inpatient hospital
services'' each place it appears and inserting ``inpatient hospital
services or inpatient rural primary care hospital services''.
(3) Section 1813(b)(3)(B) (42 U.S.C. 1395e(b)(3)(B)) is amended by
striking ``inpatient hospital services'' and inserting ``inpatient
hospital services, inpatient rural primary care hospital services''.
(4) Section 1861(a) (42 U.S.C. 1395x(a)) is amended--
(A) in paragraphs (1), by striking ``inpatient hospital
services'' and inserting ``inpatient hospital services,
inpatient rural primary care hospital services''; and
(B) in paragraph (2), by striking ``hospital'' and
inserting ``hospital or rural primary care hospital''.
(h) Authorization of Appropriations.--Section 1820(k) (42 U.S.C.
1395i-4(k)) is amended by striking ``1990, 1991, and 1992'' and
inserting ``1990 through 1995''.
(i) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act.
SEC. 13414. RURAL HEALTH TRANSITION GRANT PROGRAM EXTENSION.
Section 4005(e)(9) of OBRA-1987 is amended--
(1) by striking ``1989 and'' and inserting ``1989,''; and
(2) by striking ``1992'' and inserting ``1992 and
$30,000,000 for each of fiscal years 1993 through 1997''.
SEC. 13415. REGIONAL REFERRAL CENTER EXTENSION.
(a) Extension of Classification Through Fiscal Year 1994.--
Effective on the date of the enactment of this Act, section 6003(d) of
such Act (42 U.S.C. 1395ww note) is amended by striking ``October 1,
1992'' and inserting ``October 1, 1994''.
(b) Permitting Hospitals to Decline Reclassification.--If any
hospital fails to qualify as a rural referral center under section
1886(d)(5)(C) of the Social Security Act as a result of a decision by
the Medicare Geographic Classification Review Board under section
1886(d)(10) of such Act to reclassify the hospital as being located in
an urban area for fiscal year 1993 or fiscal year 1994, the Secretary
of Health and Human Services shall--
(1) notify such hospital of such failure to qualify,
(2) provide an opportunity for such hospital to decline
such reclassification, and
(3) if the hospital declines such reclassification,
administer the Social Security Act (other than section
1886(d)(8)(D)) for such fiscal year as if the decision by the
Review Board had not occurred.
(c) Requiring Lump-sum Retroactive Payment for Hospitals Losing
Classification.--
(1) In general.--In the case of an affected regional
referral center (as described in paragraph (2)), the Secretary
of Health and Human Services shall make a lump sum payment to
the center equal to the difference between the aggregate
payment made to the center under section 1886 of such Act
(excluding outlier payments under subsection (d)(5)(A) of such
section) during the period of applicability described in
paragraph (3) and the aggregate payment that would have been
made to the center under such section if, during the period of
applicability, the center was classified a regional referral
center under section 1886(d)(5)(C) of such Act.
(2) Affected centers described.--In paragraph (1), an
``affected regional referral center'' is a hospital classified
as regional referral center under section 1886(d)(5)(C) of the
Social Security Act as of September 30, 1992, that was not
classified as such a center after such date but would have been
so classified if the reference in section 6003(d) of OBRA-1989
to ``October 1, 1992,'' had been deemed a reference to
``October 1, 1994,''.
(3) Period of applicability.--In paragraph (1), the
``period of applicability'' is the period that begins on
October 1, 1992, and ends on the date of the enactment of this
Act.
SEC. 13416. MEDICARE-DEPENDENT, SMALL RURAL HOSPITAL PAYMENT EXTENSION.
(a) Extension of Additional Payments.--Effective on the date of the
enactment of this Act, section 1886(d)(5)(G) (42 U.S.C.
1395ww(d)(5)(G)) is amended--
(1) in clause (i) in the matter preceding subclause (I)--
(A) by inserting ``(or portion thereof)'' after
``cost reporting period'', and
(B) by striking ``March 31, 1993,'' and all that
follows and inserting the following: ``September 30,
1994, in the case of a subsection (d) hospital which is
a medicare-dependent, small rural hospital, payment
under paragraph (1)(A) shall be equal to the sum of the
amount determined under clause (ii) and the amount
determined under paragraph (1)(A)(iii).'';
(2) by redesignating clauses (ii) and (iii) as clauses
(iii) and (iv); and
(3) by inserting after clause (i) the following new clause:
``(ii) The amount determined under this clause is--
``(I) for discharges occurring during the first 3 12-month
cost reporting periods that begin on or after April 1, 1990,
the amount by which the hospital's target amount for the cost
reporting period (as defined in subsection (b)(3)(D)) exceeds
the amount determined under paragraph (1)(A)(iii); and
``(II) for discharges occurring during any subsequent cost
reporting period (or portion thereof), 50 percent of the amount
by which the hospital's target amount for the cost reporting
period (as defined in subsection (b)(3)(D)) exceeds the amount
determined under paragraph (1)(A)(iii).''.
(b) Permitting Hospitals to Decline Reclassification.--If any
hospital fails to qualify as a medicare-dependent, small rural hospital
under section 1886(d)(5)(G)(i) of the Social Security Act as a result
of a decision by the Medicare Geographic Classification Review Board
under section 1886(d)(10) of such Act to reclassify the hospital as
being located in an urban area for fiscal year 1993 or fiscal year
1994, the Secretary of Health and Human Services shall--
(1) notify such hospital of such failure to qualify,
(2) provide an opportunity for such hospital to decline
such reclassification, and
(3) if the hospital declines such reclassification,
administer the Social Security Act (other than section
1886(d)(8)(D)) for such fiscal year as if the decision by the
Review Board had not occurred.
(c) Requiring Lump-sum Retroactive Payment.--
(1) In general.--In the case of a hospital treated as a
medicare dependent, small rural hospital under section
1886(d)(5)(G) of the Social Security Act, the Secretary of
Health and Human Services shall make a lump sum payment to the
hospital equal to the difference between the aggregate payment
made to the hospital under section 1886 of such Act (excluding
outlier payments under subsection (d)(5)(A) of such section)
during the period of applicability described in paragraph (2)
and the aggregate payment that would have been made to the
hospital under such section if, during the period of
applicability, section 1886(d)(5)(G) of such Act had been
applied as if--
(A) the reference in clause (i) to ``March 31,
1993,'' had been deemed a reference to ``September 30,
1994,''; and
(B) the amendments made by subsection (a) had been
in effect.
(2) Period of applicability.--In paragraph (1), the
``period of applicability'' is, with respect to a hospital, the
period that begins on the first day of the hospital's first 12-
month cost reporting period that begins after April 1, 1992,
and ends on the date of the enactment of this Act.
SEC. 13417. EXTENSION OF REGIONAL FLOOR.
Section 1886(d)(1)(A)(iii) (42 U.S.C. 1395ww(d)(1)(A)(iii)) is
amended by striking ``September 30, 1993'' and inserting ``September
30, 1996''.
SEC. 13418. EXTENSION OF RURAL HOSPITAL DEMONSTRATION.
Section 4008(i)(1) of OBRA-1990 is amended by adding at the end the
following new sentence: ``The Secretary shall continue any such
demonstration project until at least December 31, 1995.''.
SEC. 13419. HEMOPHILIA PASS-THROUGH EXTENSION.
Effective as if included in the enactment of OBRA-1989, section
6011(d) of such Act is amended by striking ``2 years after the date of
enactment of this Act'' and inserting ``September 30, 1994''.
SEC. 13420. STATE HOSPITAL PAYMENT PROGRAMS.
In the case of a State hospital reimbursement system that meets the
requirements of section 1814(b)(3) of the Social Security Act, no other
provision of law shall be construed as preventing the system from
providing that payment for services covered under the system be made on
the basis of rates provided for under the system.
SEC. 13421. PSYCHOLOGY SERVICES IN HOSPITALS.
Section 1861(e)(4) (42 U.S.C. 1395x(e)(4)) is amended by striking
``physician;'' and inserting ``physician, except that a patient
receiving qualified psychologist services (as defined in subsection
(ii)) may be under the care of a clinical psychologist with respect to
such services to the extent permitted under State law;''.
SEC. 13422. GRADUATE MEDICAL EDUCATION PAYMENTS IN HOSPITAL-OWNED
COMMUNITY HEALTH CENTERS.
Section 1886(d)(5)(B)(iv) (42 U.S.C. 1395ww(d)(5)(B)(iv)) is
amended by inserting after ``the hospital'' the following: ``or
providing services at any entity receiving a grant under section 330 of
the Public Health Service Act that is under the ownership or control of
the hospital (if the hospital incurs all, or substantially all, of the
costs of the services furnished to the hospital by such interns and
residents)''.
SEC. 13423. TREATMENT OF CERTAIN MILITARY FACILITIES.
(a) Coverage of Services Provided in Certain Uniformed Services
Treatment Facilities.--
(1) In general.--The Secretary of Health and Human Services
may not take any recoupment action to recover amounts that were
paid by the United States under title XVIII of the Social
Security Act to the facilities described in paragraph (2) (or
to other individuals or entities with whom such facilities had
entered into agreements to provide services under such title)
for services provided during the period beginning October 1,
1986, and ending December 31, 1989, except to the extent that
funds were obligated to the Uniformed Services Treatment
Facilities program to fulfill such an action pursuant to title
VI of the Department of Defense Appropriations Act, 1993.
(2) Facilities described.--The facilities referred to in
paragraph (1) are the hospitals described in section 248c of
title 42, United States Code, that are located in Boston,
Massachusetts; Baltimore, Maryland; and Seattle, Washington.
(b) Study of Joint Medical Facilities.--
(1) Study.--The Secretary of Health and Human Services, in
consultation with the Secretary of Defense and the Secretary of
Veterans Affairs, shall conduct a study of the feasibility and
desirability of establishing joint medical facilities among the
Department of Defense, the Department of Veterans' Affairs, and
other public and private entities, and shall include in such
study an analysis of the need to make changes in the medicare
and medicaid programs (including facility certification
standards under such programs) in order to facilitate the
establishment of such joint medical facilities.
(2) Report.--Not later than October 1, 1993, the Secretary
of Health and Human Services shall submit a report to Congress
on the study conducted under paragraph (1).
SEC. 13424. EPILEPSY DRG.
(a) In General.--The Secretary of Health and Human Services shall
review the diagnosis-related groups established pursuant to section
1886(d)(4) of the Social Security Act that are assigned to discharges
of patients with intractable epilepsy, including patients whose
admissions involve intensive neurodiagnostic monitoring, and shall
revise, for discharges occurring on or after October 1, 1994, the
assignment of discharges to such groups as the Secretary considers
appropriate to account for the resource requirements of such patients.
(b) Consultation Requirements.--In carrying out subsection (a), the
Secretary shall consult with the Prospective Payment Assessment
Commission and national organizations representing individuals with
epilepsy or individuals and entities providing specialized medical
services to such individuals related to the treatment of epilepsy.
SEC. 13425. SKILLED NURSING FACILITY WAGE INDEX.
(a) In General.--Not later than 1 year after the date of the
enactment of this Act, the Secretary of Health and Human Services shall
begin to collect data on employee compensation and paid hours of
employment in skilled nursing facilities for the purpose of
constructing a skilled nursing facility wage index adjustment to the
routine service cost limits required under section 1888(a)(4) of the
Social Security Act.
(b) ProPAC Report.--The Prospective Payment Assessment Commission
shall, by March 1, 1994, study and report to the Congress on the impact
of applying routine per diem cost limits for skilled nursing facilities
on a regional basis.
SEC. 13426. HOSPICE NOTIFICATION TO BENEFICIARIES.
(a) Hospitals.--Section 1861(ee)(2)(D) (42 U.S.C. 1395x(ee)(2)(D))
is amended by inserting ``, including hospice services,'' after ``post-
hospital services''.
(b) Nursing Facilities.--Section 1819(c)(1)(B) (42 U.S.C. 1395i-
3(c)(1)(B)) is amended--
(1) by striking ``and'' at the end of clause (ii);
(2) by striking the period at the end of clause (iii) and
inserting ``; and''; and
(3) by inserting after clause (iii) the following new
clause:
``(iv) inform each resident who is entitled
to benefits under this title, orally and in
writing at the time of admission to the
facility, of the entitlement of individuals to
hospice care under section 1812(a)(4) (unless
there is no hospice program providing hospice
care for which payment may be made under this
title within the geographic area of the
facility and it is not the common practice of
the facility to refer patients to hospice
programs located outside such geographic
area).''.
(c) Effective Date.--The amendments made by this section shall
apply to services furnished on or after the first day of the first
month beginning more than one year after the date of the enactment of
this Act.
SEC. 13427. REDUCTION IN PART A PREMIUM FOR CERTAIN INDIVIDUALS WITH 30
OR MORE QUARTERS OF SOCIAL SECURITY COVERAGE.
(a) In General.--Section 1818(d) (42 U.S.C. 1395i-2(d)) is
amended--
(1) in the second sentence of paragraph (2), by striking
``Such amount'' and inserting ``Subject to paragraph (4), the
amount of an individual's monthly premium under this section'';
and
(2) by adding at the end the following new paragraph:
``(4)(A) In the case of an individual described in subparagraph
(B), the monthly premium for a month shall be reduced by the applicable
reduction percent specified in the following table:
The applicable reduction
``For a month in: percent is:
1994.......................................... 25 percent
1995.......................................... 30 percent
1996.......................................... 35 percent
1997.......................................... 40 percent
1998 or subsequent year....................... 45 percent.
``(B) An individual described in this subparagraph with respect to
a month is an individual who establishes to the satisfaction of the
Secretary that, as of the last day of the previous month, the
individual--
``(i) had at least 30 quarters of coverage under title II;
``(ii) was married (and had been married for the previous 1
year period) to an individual who had at least 30 quarters of
coverage under such title;
``(iii) had been married to an individual for a period of
at least 1 year (at the time of the individual's death) if at
such time the individual had at least 30 quarters of coverage
under such title; and
``(iv) is divorced from an individual and had been married
to the individual for a period of at least 10 years (at the
time of the divorce) if at such time the individual had at
least 30 quarters of coverage under such title.''.
(b) Effective Date.--The amendments made by this section shall
apply to monthly premiums under section 1818 of the Social Security Act
for months beginning with January 1, 1994.
SEC. 13428. PERIODIC UPDATES TO SALARY EQUIVALENCY GUIDELINES FOR
PHYSICAL THERAPY AND RESPIRATORY THERAPY SERVICES.
(a) In General.--Section 1861(v)(5) (42 U.S.C. 1395x(v)(5)) is
amended by adding at the end the following new subparagraph:
``(C) Using the most recent available data, the Secretary shall
update, not less often than every 3 years, the salary equivalency
guidelines used under subparagraph (A) with respect to physical therapy
and respiratory therapy services.''.
(b) Effective Date.--The Secretary of Health and Human Services
shall first update the salary equivalency guidelines, under the
amendment made by subsection (a), by not later than December 31, 1993.
Such updated guidelines shall apply to cost reporting periods beginning
on or after July 1, 1993.
SEC. 13429. EXTENSION OF DEADLINE FOR APPLICATION FOR GEOGRAPHIC
CLASSIFICATION FOR CERTAIN RECLASSIFIED HOSPITALS.
Notwithstanding section 1886(d)(10)(C)(ii) of the Social Security
Act, a hospital may submit an application to the Medicare Geographic
Classification Review Board requesting a change in geographic
classification for fiscal year 1994 after the first day of fiscal year
1993 if--
(1) the hospital's geographic classification for fiscal
year 1994 was changed from urban to rural as a result of the
issuance of the Revised Statistical Definitions for
Metropolitan Areas established by the Office of Management and
Budget on December 28, 1992 (pursuant to OMB Bulletin No. 93-
05); and
(2) the hospital submits the application not later than 60
days after the date of the enactment of this Act.
SEC. 13430. CLARIFICATION OF DRG PAYMENT WINDOW EXPANSION;
MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Clarification of DRG Payment Window Expansion.--The first
sentence of section 1886(a)(4) (42 U.S.C. 1395ww(a)(4)) is further
amended by striking ``and includes'' and inserting ``and (in the case
of a subsection (d) hospital) includes''.
(b) Technical Correction Relating to Resident Assessment in Nursing
Homes.--Section 1819(b)(3)(C)(i)(I) (42 U.S.C. 1395i-3(b)(3)(C)(i)(I))
is amended by striking ``not later than'' before ``14 days''.
(c) Clerical Corrections.--(1) Section 1814(i)(1)(C)(i) (42 U.S.C.
1395f(i)(1)(C)(i)) is amended by striking ``1990,,'' and inserting
``1990,''.
(2) Section 1816(f)(2)(A)(ii) (42 U.S.C. 1396h(f)(2)(A)(ii)) is
amended by striking ``such agency'' and inserting ``such agency's''.
(3) Section 1886(d)(1)(A)(iii) (42 U.S.C. 1395ww(d)(1)(A)(iii)) is
amended by striking ``, the sum of'' and inserting ``is equal to the
sum of''.
CHAPTER 2--PROVISIONS RELATING TO PART B
Subchapter A--Elimination of Inflation Update
SEC. 13431. ELIMINATION OF INFLATION UPDATE FOR PHYSICIAN AND RELATED
PROFESSIONAL SERVICES.
(a) No Increase in Index.--Section 1848(d)(3)(A) (42 U.S.C. 1395w-
4(d)(3)(A)) is amended--
(1) in clause (i), by striking ``clause (iii)'' and
inserting ``clauses (iii) and (iv)'', and
(2) by adding at the end the following new clause:
``(iv) No increase in index for 1994 or
1995.--In applying clause (i) for services
furnished on or after January 1, 1994, the
percentage increase in the appropriate update
index for each of 1994 and 1995 shall be 0
percent.''.
(b) No Increase in MEI for 1994 and 1995.--Section 1842(b)(4)(E)
(42 U.S.C. 1395u(b)(4)(E)) is amended by adding at the end the
following new clause:
``(vi) For purposes of this part for items and services furnished
in 1994 or 1995, the percentage increase in the MEI is 0 percent.''.
SEC. 13432. ELIMINATION OF COST-OF-LIVING ADJUSTMENTS FOR CERTAIN ITEMS
AND SERVICES.
(a) Clinical Laboratory Services.--Section 1833(h)(2)(A)(ii) (42
U.S.C. 1395l(h)(2)(A)(ii)) is amended--
(1) by striking ``and'' at the end of subclause (II),
(2) by striking the period at the end of subclause (III)
and inserting ``, and'', and
(3) by adding at the end the following new subclause:
``(IV) the annual adjustment in the fee schedules
determined under clause (i) for each of the years 1994 and 1995
shall be 0 percent.''.
(b) Durable Medical Equipment.--Section 1834(a)(14) (42 U.S.C.
1395m(a)(14)) is amended--
(1) in subparagraph (A), as amended by 13469(a), by
striking ``and'' at the end;
(2) in subparagraph (B)--
(A) by striking ``a subsequent year'' and inserting
``1993'', and
(B) by striking ``June of the previous year.'' and
inserting ``June 1992,''; and
(3) by adding at the end the following new subparagraphs:
``(C) for 1994 and 1995, no percentage change, and
``(D) for a subsequent year, the percentage
increase in the consumer price index for all urban
consumers (U.S. city average) for the 12-month period
ending with June of the previous year.''.
(c) Orthotics and Prosthetics.--Section 1834(h)(4)(A) (42 U.S.C.
1395m(h)(4)(A)) is amended--
(1) in clause (i), by striking ``and'';
(2) in clause (ii), by striking ``a subsequent year'' and
inserting ``1992 and 1993''; and
(3) by adding at the end the following new clauses:
``(iii) for 1994 and 1995, 0 percent, and
``(iv) for a subsequent year, the
percentage increase in the consumer price index
for all urban consumers (United States city
average) for the 12-month period ending with
June of the previous year;''.
(d) Reasonable Charge Limits for Enteral and Parenteral Nutrients,
Supplies and Equipment.--In determining the amount of payment under
part B of title XVIII of the Social Security Act during 1994 and 1995,
the charges determined to be reasonable with respect to parenteral and
enteral nutrients, supplies, and equipment may not exceed the charges
determined to be reasonable with respect to such nutrients, supplies,
and equipment during 1993.
SEC. 13433. AMBULATORY SURGICAL CENTER SERVICES.
(a) Elimination of Inflation Update.--The Secretary of Health and
Human Services shall not provide for any inflation update in the
payment amounts under subparagraphs (A) and (B) of section 1833(i)(2)
of the Social Security Act for fiscal year 1994 or for fiscal year
1995.
(b) Conforming Amendment.--Section 1833(i)(2)(C) (42 U.S.C.
1395l(i)(2)(C)), as added by section 13453(a)(2)(B), is amended by
striking ``fiscal year 1995'' and inserting ``fiscal year 1996''.
SEC. 13434. OTHER ITEMS AND SERVICES UNDER PART B.
(a) Rural Health Clinic Services; Federally-Qualified Health Center
Services; Comprehensive Outpatient Rehabilitation Facility Services.--
In determining the amount of payment made for rural health clinic
services, Federally qualified health center services, or comprehensive
outpatient rehabilitation facility services furnished under part B of
title XVIII of the Social Security Act for services furnished on or
after January 1, 1994, the Secretary of Health and Human Services shall
provide that any inflation update, in the applicable limits used to
determine the costs which are reasonable and related to the cost of
furnishing such services under section 1833(a)(3) of such Act, that
would otherwise have applied for 1994 or for 1995 shall be deemed to be
0 percent.
(b) Dialysis Services.--In determining the amount of payment made
for dialysis services furnished under part B of title XVIII of the
Social Security Act on or after January 1, 1994, the Secretary of
Health and Human Services shall provide that any inflation update, in
the payment amounts determined under section 1881(b)(2)(B) of such Act
or the rates determined under section 1881(b)(7) of such Act, that
would otherwise have applied for 1994 or for 1995 shall be deemed to be
0 percent.
(c) Other Part B Items and Services.--In determining the amount of
payment made for an item or service furnished under part B of title
XVIII of the Social Security Act on or after January 1, 1994, other
than an item or service to which a preceding provision of (or amendment
made by) this subchapter applies, the Secretary of Health and Human
Services shall provide that any inflation update in the fee schedule
amount for the item or service established under such part B of such
title, or (if applicable) any applicable limit used to determine the
actual charge, reasonable charge, or reasonable cost for the item or
service under such part, that would otherwise have applied for 1994 or
for 1995 shall be deemed to be 0 percent.
Subchapter B--Physicians' Services
SEC. 13441. REINSTATING SEPARATE PAYMENT FOR THE INTERPRETATION OF
ELECTROCARDIOGRAMS (EKGS).
(a) In General.--Paragraph (3) of section 1848(b) (42 U.S.C. 1395w-
4(b)) is amended to read as follows:
``(3) Treatment of interpretation of electrocardiograms.--
The Secretary--
``(A) shall make separate payment under this
section for the interpretation of electrocardiograms
performed or ordered to be performed as part of or in
conjunction with a visit to or a consultation with a
physician, and
``(B) shall adjust the relative values established
for visits and consultations under subsection (c) so as
not to include relative value units for interpretations
of electrocardiograms in the relative value for visits
and consultations.''.
(b) Assuring Budget Neutrality.--Section 1848(c)(2) (42 U.S.C.
1395w-4(c)(2)) is amended by adding at the end the following new
subparagraph:
``(E) Budget neutrality adjustments.--The
Secretary--
``(i) shall reduce the relative values for
all services (other than anesthesia services)
established under this paragraph (and, in the
case of anesthesia services, the conversion
factor established by the Secretary for such
services) by such percentage as the Secretary
determines to be necessary so that, beginning
in 1996, the amendment made by section 13441(a)
of the Omnibus Budget Reconciliation Act of
1993 would not result in expenditures under
this section that exceed the amount of such
expenditures that would have been made if such
amendment had not been made, and
``(ii) shall reduce the amounts determined
under subsection (a)(2)(B)(i)(I) by such
percentage as the Secretary determines to be
required to assure that, taking into account
the reductions made under clause (i), the
amendment made by section 13441(a) of the
Omnibus Budget Reconciliation Act of 1993 would
not result in expenditures under this section
in 1993 that exceed the amount of such
expenditures that would have been made if such
amendment had not been made.''.
(c) Conforming Amendments.--Section 1848 (42 U.S.C. 1395w-4) is
amended--
(1) in subsection (a)(2)(B)(i)(I), by inserting ``and as
adjusted under subsection (c)(2)(E)(ii)'' after ``for 1993'';
(2) in subsection (c)(2)(A)(i), by adding at the end the
following: ``Such relative values are subject to adjustment
under subparagraph (E)(i).''; and
(3) in subsection (i)(1)(B), by adding at the end
``including adjustments under subsection (c)(2)(E),''.
(d) Effective Date.--The amendments made by this section shall
apply to services furnished on or after January 1, 1994.
SEC. 13442. PAYMENTS FOR NEW PHYSICIANS AND PRACTITIONERS.
(a) Equal Treatment of New Physicians and Practitioners.--(1)
Section 1848(a) (42 U.S.C. 1395w-4(a)) is amended by striking paragraph
(4).
(2) Section 1842(b)(4) (42 U.S.C. 1395u(b)(4)) is amended by
striking subparagraph (F).
(b) Budget Neutrality Adjustment.--Notwithstanding any other
provision of law, the Secretary of Health and Human Services shall
reduce the following values and amounts for 1993 (to be applied for
that year and subsequent years) by such uniform percentage as the
Secretary determines to be required to assure that the amendments made
by subsection (a) will not result in expenditures under part B of title
XVIII of the Social Security Act in 1993 that exceed the amount of such
expenditures that would have been made if such amendments had not been
made:
(1) The relative values established under section 1848(c)
of such Act for services (other than anesthesia services) and,
in the case of anesthesia services, the conversion factor
established under section 1848 of such Act for such services.
(2) The amounts determined under section
1848(a)(2)(B)(i)(I) of such Act.
(3) The prevailing charges or fee schedule amounts to be
applied under such part for services of a health care
practitioner (as defined in section 1842(b)(4)(F)(ii)(I) of
such Act, as in effect before the date of the enactment of this
Act).
(c) Conforming Amendments.--Section 1848 (42 U.S.C. 1395w-4), as
amended by section 13441(c), is amended--
(1) in subsection (a)(2)(B)(i)(I), by inserting ``and
section 13442(b) of the Omnibus Budget Reconciliation Act of
1993'' after ``(c)(2)(E)(ii)'' after ``for 1993'';
(2) in subsection (c)(2)(A)(i), by inserting ``and section
13442(b) of the Omnibus Budget Reconciliation Act of 1993''
after ``under subparagraph (E)(i)''; and
(3) in subsection (i)(1)(B), by inserting ``and section
13442(b) of the Omnibus Budget Reconciliation Act of 1993''
after ``under subsection (c)(2)(E)''.
(d) Effective Date.--The amendments made by subsection (a) shall
apply to services furnished on or after January 1, 1994.
SEC. 13443. RETAINING PAYMENT FOR ACTUAL ANESTHESIA TIME.
(a) Physicians' Services.--Section 1848(b)(2)(B) (42 U.S.C. 1395w-
4(b)(2)(B)) is amended by adding at the end the following: ``The
Secretary may not modify the methodology in effect as of January 1,
1992, for determining the amount of time that may be billed for such
services under this section.''.
(b) Services of Certified Registered Nurse Anesthetists.--Section
1833(l)(1)(B) (42 U.S.C. 1395l(l)(1)(B)) is amended by adding at the
end the following: ``The Secretary may not modify the methodology in
effect as of January 1, 1992, for determining the amount of time that
may be billed for such services under this section.''.
(c) Effective Date.--The amendments made by this section shall take
apply to services furnished on or after the date of the enactment of
this Act.
SEC. 13444. GEOGRAPHIC COST OF PRACTICE INDEX REFINEMENTS.
(a) Requiring Consultation with Representatives of Physicians in
Reviewing Geographic Adjustment Factors.--Section 1848(e)(1)(C) (42
U.S.C. 1395w-4(e)(1)(C)) is amended by striking ``shall review'' and
inserting ``shall, in consultation with appropriate representatives of
physicians, review''.
(b) Use of Most Recent Data In Geographic Adjustment.--Section
1848(e)(1) (42 U.S.C. 1395w-4(e)(1)) is amended by adding at the end
the following new subparagraph:
``(D) Use of recent data.--In establishing indices
and index values under this paragraph, the Secretary
shall use the most recent data available relating to
practice expenses, malpractice expenses, and physician
work effort in different fee schedule areas.''.
(c) Deadline for Initial Review and Revision.--The Secretary of
Health and Human Services shall first review and revise geographic
adjustment factors under section 1848(e)(1)(C) of the Social Security
Act by not later than January 1, 1995. Not later than April 1, 1994,
the Secretary shall study and report to report to the Committee on
Finance of the Senate and the Committee on Ways and Means and the
Committee on Energy and Commerce of the House of Representatives on the
construction of the geographic cost of practice index under section
1848(e)(1)(A)(i) of such Act.
(d) Report on Review Process.--Not later than 1 year after the date
of the enactment of this Act, the Secretary of Health and Human
Services shall study and report to the Committee on Finance of the
Senate and the Committee on Ways and Means and the Committee on Energy
and Commerce of the House of Representatives on--
(1) the data necessary to review and revise the indices
established under section 1848(e)(1)(A) of the Social Security
Act, including--
(A) the shares allocated to physicians' work
effort, practice expenses (other than malpractice
expenses), and malpractice expenses;
(B) the weights assigned to the input components of
such shares; and
(C) the index values assigned to such components;
(2) any limitations on the availability of data necessary
to review and revise such indices at least every three years;
(3) ways of addressing such limitations, with particular
attention to the development of alternative data sources for
input components for which current index values are based on
data collected less frequently than every three years; and
(4) the costs of developing more accurate and timely data.
(e) Development of Criteria for Use in Determining Payment
Localities.--The Physician Payment Review Commission shall conduct a
study to develop criteria that would be used to refine the fee schedule
areas that are used within States, in applying geographic adjustment
factors for computing payment amounts, under section 1848 of the Social
Security Act. The Commission shall include a report on such study in
its recommendations submitted to the Congress under section 1845(b) of
such Act in 1994.
SEC. 13445. EXTRA-BILLING.
(a) Enforcement and Uniform Application.--
(1) Enforcement.--Paragraph (1) of section 1848(g) (42
U.S.C. 1395w-4(g)) is amended to read as follows:
``(1) Limitation on actual charges.--
``(A) In general.--In the case of a
nonparticipating physician or nonparticipating supplier
or other person (as defined in section 1842(i)(2)) who
does not accept payment on an assignment-related basis
for a physician's service furnished with respect to an
individual enrolled under this part, the following
rules apply:
``(i) Application of limiting charge.--No
person may bill or collect an actual charge for
the service in excess of the limiting charge
described in paragraph (2) for such service.
``(ii) No liability for excess charges.--No
person is liable for payment of any amounts
billed for the service in excess of such
limiting charge.
``(iii) Correction of excess charges.--If
such a physician, supplier, or other person
bills, but does not collect, an actual charge
for a service in violation of clause (i), the
physician, supplier, or other person shall
reduce on a timely basis the actual charge
billed for the service to an amount not to
exceed the limiting charge for the service.
``(iv) Refund of excess collections.--If
such a physician, supplier, or other person
collects an actual charge for a service in
violation of clause (i), the physician,
supplier, or other person shall provide on a
timely basis a refund to the individual charged
in the amount by which the amount collected
exceeded the limiting charge for the service.
The amount of such a refund shall be reduced to
the extent the individual has an outstanding
balance owed by the individual to the
physician.
``(B) Sanctions.--If a physician, supplier, or
other person--
``(i) knowingly and willfully bills or
collects for services in violation of
subparagraph (A)(i) on a repeated basis, or
``(ii) fails to comply with clause (iii) or
(iv) of subparagraph (A) on a timely basis,
the Secretary may apply sanctions against the
physician, supplier, or other person in accordance with
paragraph (2) of section 1842(j). In applying this
subparagraph, paragraph (4) of such section applies in
the same manner as such paragraph applies to such
section and any reference in such section to a
physician is deemed also to include a reference to a
supplier or other person under this subparagraph.
``(C) Timely basis.--For purposes of this
paragraph, a correction of a bill for an excess charge
or refund of an amount with respect to a violation of
subparagraph (A)(i) in the case of a service is
considered to be provided `on a timely basis', if the
reduction or refund is made not later than 30 days
after the date the physician, supplier, or other person
is notified by the carrier under this part of such
violation and of the requirements of subparagraph
(A).''.
(2) Uniform application of extra-billing limits to
physicians' services.--
(A) In general.--Section 1848(g)(2)(C) (42 U.S.C.
1395w-4(g)(2)(C)) is amended by inserting ``or for
nonparticipating suppliers or other persons'' after
``nonparticipating physicians''.
(B) Conforming definition.--Section 1842(i)(2) (42
U.S.C. 1395u(i)(2)) is amended--
(i) by striking ``, and the term'' and
inserting ``; the term'', and
(ii) by inserting before the period at the
end the following: ``; and the term
`nonparticipating supplier or other person'
means a supplier or other person (excluding a
provider of services) that is not a
participating physician or supplier (as defined
in subsection (h)(1))''.
(b) Pre-Payment Screening of Claims.--Subparagraph (G) of section
1842(b)(3) (42 U.S.C. 1395u(b)(3)) is amended to read as follows:
``(G) will, for a service that is furnished with respect to
an individual enrolled under this part, that is not paid on an
assignment-related basis, and that is subject to a limiting
charge under section 1848(g)--
``(i) determine, prior to making payment, whether
the amount billed for such service exceeds the limiting
charge applicable under section 1848(g)(2);
``(ii) notify the physician, supplier, or other
person periodically (but not less often than once every
30 days) of determinations that amounts billed exceeded
such applicable limiting charges; and
``(iii) provide for prompt response to inquiries of
physicians, suppliers, and other persons concerning the
accuracy of such limiting charges for their
services;''.
(c) Information on Extra-Billing Limits.--
(1) Part of explanation of medicare benefits.--Section
1842(h)(7) (42 U.S.C. 1395u(h)(7)) is amended--
(A) by striking ``and'' at the end of subparagraph
(B),
(B) in subparagraph (C), by striking ``shall
include'' and by striking the period at the end and
inserting ``, and'', and
(C) by adding at the end the following new
subparagraph:
``(D) in the case of services for which the billed amount
exceeds the limiting charge imposed under section 1848(g),
information regarding such applicable limiting charge
(including information concerning the right to a refund under
section 1848(g)(1)(A)(iv)).''.
(2) Report on charges in excess of limiting charge.--
Section 1848(g)(6)(B) (42 U.S.C. 1395w-4(g)(6)(B)) is amended
by inserting ``the extent to which actual charges exceed
limiting charges, the number and types of services involved,
and the average amount of excess charges and'' after ``report
to the Congress''.
(d) Applying the Limiting Charge to Nonphysician Services Provided
Under the Physician Fee Schedule.--Section 1848 (42 U.S.C. 1395w-4) is
amended--
(1) in subsection (a)(3), by inserting ``and suppliers''
after ``physicians'', and by inserting ``or a nonparticipating
supplier or other person'' after ``nonparticipating physician''
and by adding at the end the following: ``In the case of
physicians' services (including services which the Secretary
excludes pursuant to subsection (j)(3)) of a nonparticipating
physician, supplier, or other person for which payment is made
under this part on a basis other than the fee schedule amount,
the payment shall be based on 95 percent of the payment basis
for such services furnished by a participating physician,
supplier, or other person.'';
(2) in subsection (g)(1)(A), as amended by subsection (a),
in the matter before clause (i), by inserting ``(including
services which the Secretary excludes pursuant to subsection
(j)(3))'' after ``a physician's service'';
(3) in subsection (g)(2)(D), by inserting ``(or, if payment
under this part is made on a basis other than the fee schedule
under this section, 95 percent of the other payment basis)''
after ``subsection (a)'';
(4) in subsection (g)(3)(B)--
(A) by inserting after the first sentence the
following: `` No person is liable for payment of any
amounts billed for such a service in violation of the
previous sentence.'', and
(B) in the last sentence, by striking ``previous
sentence'' and inserting ``first sentence'';
(5) in subsection (h)--
(A) by inserting ``or nonparticipating supplier or
other person furnishing physicians' services (as
defined in section 1848(j)(3))'' after ``physician''
the first place it appears,
(B) by inserting ``, supplier, or other person''
after ``physician'' the second place it appears, and
(C) by inserting ``, suppliers, and other persons''
after ``physicians'' the second place it appears; and
(6) in subsection (j)(3), by inserting ``, except for
purposes of subsections (a)(3), (g), and (h)'' after ``tests
and''.
(e) Clarification of Mandatory Assignment Rules for Certain
Practitioners.--
(1) In general.--Section 1842(b) (42 U.S.C. 1395u(b)), as
amended by section 13449(e), is amended by adding at the end
the following new paragraph:
``(18)(A) Payment for any service furnished by a practitioner
described in subparagraph (C) and for which payment may be made under
this part on a reasonable charge or fee schedule basis may only be made
under this part on an assignment-related basis.
``(B) A practitioner described in subparagraph (C) or other person
may not bill (or collect any amount from) the individual or another
person for any service described in subparagraph (A), except for
deductible and coinsurance amounts applicable under this part. No
person is liable for payment of any amounts billed for such a service
in violation of the previous sentence. If a practitioner or other
person knowingly and willfully bills (or collects an amount) for such a
service in violation of such sentence, the Secretary may apply
sanctions against the practitioner or other person in the same manner
as the Secretary may apply sanctions against a physician in accordance
with section 1842(j)(2) in the same manner as such section applies with
respect to a physician. Paragraph (4) of section 1842(j) shall apply in
this subparagraph in the same manner as such paragraph applies to such
section.
``(C) A practitioner described in this subparagraph is any of the
following:
``(i) A physician assistant, nurse practitioner, or
clinical nurse specialist (as defined in section 1861(aa)(5)).
``(ii) A certified registered nurse anesthetist (as defined
in section 1861(bb)(2)).
``(iii) A certified nurse-midwife (as defined in section
1861(gg)(2)).
``(iv) A clinical social worker (as defined in section
1861(hh)(1)).
``(v) A clinical psychologist (as defined by the Secretary
for purposes of section 1861(ii)).
``(D) For purposes of this paragraph, a service furnished by a
practitioner described in subparagraph (C) includes any services and
supplies furnished as incident to the service as would otherwise be
covered under this part if furnished by a physician or as incident to a
physician's service.''.
(2) Conforming amendments.--
(A) Section 1833 (42 U.S.C. 1395l) is amended--
(i) in subsection (l)(5), by striking
subparagraph (B) and redesignating subparagraph
(C) as subparagraph (B);
(ii) by striking subsection (p); and
(iii) in subsection (r), by striking
paragraph (3) and redesignating paragraph (4)
as paragraph (3).
(B) Section 1842(b)(12) (42 U.S.C. 1395u(b)(12)) is
amended by striking subparagraph (C).
(f) Miscellaneous and Technical Amendments.--Section 1833 (42
U.S.C. 1395l) is amended--
(1) in subsection (a)(1), as amended by section
13479(e)(2)--
(A) by striking ``and'' before ``(O)'', and
(B) by inserting before the semicolon at the end
the following: ``, and (P) with respect to services
described in clauses (i), (ii) and (iv) of section
1861(s)(2)(K), the amounts paid are subject to the
provisions of section 1842(b)(12)''; and
(2) in subsection (h)(5)(D)--
(A) by striking ``paragraphs (2) and (3)'' and by
inserting ``paragraph (2)'', and
(B) by adding at the end the following: ``Paragraph
(4) of such section shall apply in this subparagraph in
the same manner as such paragraph applies to such
section.''.
(g) Effective Dates.--
(1) Enforcement and uniform application; miscellaneous and
technical amendments.--The amendments made by subsections (a),
(d), and (f) shall apply to services furnished on or after the
date of the enactment of this Act; except that such amendments
made by subsections (a) and (d) shall not apply to services of
a nonparticipating supplier or other person furnished before
January 1, 1994.
(2) Carrier determinations.--The amendments made by
subsection (b) shall apply to contracts as of January 1, 1994.
(3) EOMBs.--The amendments made by subsection (c)(1) shall
apply to explanations of benefits provided on or after January
1, 1994.
(4) Report.--The amendment made by subsection (c)(2) shall
apply to reports for years beginning with 1994.
(5) Practitioners.--The amendments made by subsection (e)
shall apply to services furnished on or after January 1, 1994.
SEC. 13446. RELATIVE VALUES FOR PEDIATRIC SERVICES.
(a) In General.--The Secretary of Health and Human Services shall
fully develop, by not later than July 1, 1994, relative values for the
full range of pediatric physicians' services which are consistent with
the relative values developed for other physicians' services under
section 1848(c) of the Social Security Act. In developing such values,
the Secretary shall conduct such refinements as may be necessary to
produce appropriate estimates for such relative values.
(b) Study.--
(1) In general.--The Secretary shall conduct a study of the
relative values for pediatric and other services to determine
whether there are significant variations in the resources used
in providing similar services to different populations. In
conducting such study, the Secretary shall consult with
appropriate organizations representing pediatricians and other
physicians.
(2) Report.--Not later than July 1, 1994, the Secretary
shall submit to Congress a report on the study conducted under
paragraph (1). Such report shall include any appropriate
recommendations regarding needed changes in coding or other
payment policies to ensure that payments for pediatric services
appropriately reflect the resources required to provide these
services.
SEC. 13447. ANTIGENS UNDER PHYSICIAN FEE SCHEDULE.
(a) In General.--Section 1848(j)(3) (42 U.S.C. 1395w-4(j)(3)) is
amended by inserting ``(2)(G),'' after ``(2)(D),''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to services furnished on or after January 1, 1995.
SEC. 13448. ADMINISTRATION OF CLAIMS RELATING TO PHYSICIANS' SERVICES.
(a) Limitation on Carrier User Fees.--Section 1842(c) (42 U.S.C.
1395u(c)) is amended by adding at the end the following new paragraph:
``(4) Neither a carrier nor the Secretary may impose a fee under
this title--
``(A) for the filing of claims related to physicians'
services,
``(B) for an error in filing a claim relating to
physicians' services or for such a claim which is denied,
``(C) for any appeal under this title with respect to
physicians' services,
``(D) for applying for (or obtaining) a unique identifier
under subsection (r), or
``(E) for responding to inquiries respecting physicians'
services or for providing information with respect to medical
review of such services.''.
(b) Clarification of Permissible Substitute Billing Arrangements.--
(1) In general.--Clause (D) of section 1842(b)(6) (42
U.S.C. 1395u(b)(6)), as amended by section 13449(f), is amended
to read as follows: ``(D) payment may be made to a physician
for physicians' services (and services furnished incident to
such services) furnished by a second physician to patients of
the first physician if (i) the first physician is unavailable
to provide the services; (ii) the services are furnished
pursuant to an arrangement between the two physicians that (I)
is informal and reciprocal, or (II) involves per diem or other
fee-for-time compensation for such services; (iii) the services
are not provided by the second physician over a continuous
period of more than 60 days; and (iv) the claim form submitted
to the carrier for such services includes the second
physician's unique identifier (provided under the system
established under subsection (r)) and indicates that the claim
meets the requirements of this clause for payment to the first
physician''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to services furnished on or after the first day of
the first month beginning more than 60 days after the date of
the enactment of this Act.
SEC. 13449. MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Overvalued Procedures (Section 4101 of OBRA-1990).--(1) Section
1842(b)(16)(B)(iii) (42 U.S.C. 1395u(b)(16)(B)(iii)) is amended--
(A) by striking ``, simple and subcutaneous'',
(B) by striking ``; small'' and inserting ``and small'',
(C) by striking ``treatments;'' the first place it appears
and inserting ``and'',
(D) by striking ``lobectomy;'',
(E) by striking ``enterectomy; colectomy;
cholecystectomy;'',
(F) by striking ``; transurerethral resection'' and
inserting ``and resection'', and
(G) by striking ``sacral laminectomy;''.
(2) Section 4101(b)(2) of OBRA-1990 is amended--
(A) in the matter before subparagraph (A), by striking
``1842(b)(16)'' and inserting ``1842(b)(16)(B)'', and
(B) in subparagraph (B)--
(i) by striking ``, simple and subcutaneous'',
(ii) by striking ``(HCPCS codes 19160 and 19162)''
and inserting ``(HCPCS code 19160)'', and
(iii) by striking all that follows ``(HCPCS codes
92250'' and inserting ``and 92260).''.
(b) Radiology Services (Section 4102 of OBRA-1990).--(1) Section
1834(b)(4) (42 U.S.C. 1395m(b)(4)) is amended by redesignating
subparagraphs (E) and (F) as subparagraphs (F) and (G), respectively.
(2) Section 1834(b)(4)(D) (42 U.S.C. 1395m(b)(4)(D)) is amended--
(A) in the matter before clause (i), by striking ``shall be
determined as follows:'' and inserting ``shall, subject to
clause (vii), be reduced to the adjusted conversion factor for
the locality determined as follows:'',
(B) in clause (iv), by striking ``Local adjustment.--
Subject to clause (vii), the conversion factor to be applied
to'' and inserting ``Adjusted conversion factor.--The adjusted
conversion factor for'',
(C) in clause (vii), by striking ``under this
subparagraph'', and
(D) in clause (vii), by inserting ``reduced under this
subparagraph by'' after ``shall not be''.
(3) Section 4102(c)(2) of OBRA-1990 is amended by striking
``radiology services'' and all that follows and inserting ``nuclear
medicine services.''.
(4) Section 4102(d) of OBRA-1990 is amended by striking ``new
paragraph'' and inserting ``new subparagraph''.
(5) Section 1834(b)(4)(E) (42 U.S.C. 1395m(b)(4)(E)) is amended by
inserting ``Rule for certain scanning services.--'' after ``(E)''.
(6) Section 1848(a)(2)(D)(iii) (42 U.S.C. 1395w-4(a)(2)(D)(iii)) is
amended by striking ``that are subject to section 6105(b) of the
Omnibus Budget Reconciliation Act of 1989'' and by striking ``provided
under such section'' and inserting ``provided under section 6105(b) of
the Omnibus Budget Reconciliation Act of 1989''.
(c) Anesthesia Services (Section 4103 of OBRA-1990).--(1) Section
4103(a) of OBRA-1990 is amended by striking ``Reduction in Fee
Schedule'' and inserting ``Reduction in Prevailing Charges''.
(2) Section 1842(q)(1)(B) (42 U.S.C. 1395u(q)(1)(B)) is amended--
(A) in the matter before clause (i), by striking ``shall be
determined as follows:'' and inserting ``shall, subject to
clause (iv), be reduced to the adjusted prevailing charge
conversion factor for the locality determined as follows:'',
and
(B) in clause (iii), by striking ``Subject to clause (iv),
the prevailing charge conversion factor to be applied in'' and
inserting ``The adjusted prevailing charge conversion factor
for''.
(d) Assistants at Surgery (Section 4107 of OBRA-1990).--(1) Section
4107(c) of OBRA-1990 is amended by inserting ``(a)(1)'' after
``subsection''.
(2) Section 4107(a)(2) of OBRA-1990 is amended by adding at the end
the following: ``In applying section 1848(g)(2)(D) of the Social
Security Act for services of an assistant-at-surgery furnished during
1991, the recognized payment amount shall not exceed the maximum amount
specified under section 1848(i)(2)(A) of such Act (as applied under
this paragraph in such year).''.
(e) Technical Components of Diagnostic Services (Section 4108 of
OBRA-1990).--Section 1842(b) (42 U.S.C. 1395u(b)) is amended by
redesignating paragraph (18), as added by section 4108(a) of OBRA-1990,
as paragraph (17) and, in such paragraph, by inserting ``, tests
specified in paragraph (14)(C)(i),'' after ``diagnostic laboratory
tests''.
(f) Reciprocal Billing Arrangements (Section 4110 of OBRA-1990).--
Section 1842(b)(6)(D) (42 U.S.C. 1395u(b)(6)(D)) is amended--
(1) by striking ``visit services (including emergency
visits and related services)'' and inserting ``physicians'
services (and services furnished incident to such services)'';
(2) by striking ``on an occasional, reciprocal basis'' and
inserting ``under an arrangement that is informal and
reciprocal or involves per diem or other fee-for-time
compensation for services'';
(3) by striking ``visit'' in subclauses (i), (ii), and
(iv); and
(4) in subclause (iii), by striking ``the claim'' and all
that follows through the comma at the end and inserting ``the
claim meets the requirements of this clause for payment to the
first physician''.
(g) Study of Aggregation Rule for Claims of Similar Physician
Services (Section 4113 of OBRA-1990).--Section 4113 of OBRA-1990 is
amended--
(1) by inserting ``of the Social Security Act'' after
``1869(b)(2)''; and
(2) by striking ``December 31, 1992'' and inserting
``December 31, 1993''.
(h) Statewide Fee Schedules (Section 4117 of OBRA-1990).--Section
4117 of OBRA-1990 is amended--
(1) in subsection (a)--
(A) by striking ``In General.--'', and
(B) by striking ``, if the'' and all that follows
through ``1991, ''; and
(2) by striking subsections (b), (c), and (d).
(i) Other Miscellaneous and Technical Amendments.--(1) The heading
of section 1834(f) (42 U.S.C. 1395m(f)) is amended by striking ``Fiscal
Year''.
(2)(A) Section 4105(b) of OBRA-1990 is amended--
(i) in paragraph (2), by striking ``amendments'' and
inserting ``amendment'', and
(ii) in paragraph (3), by striking ``amendments made by
paragraphs (1) and (2)'' and inserting ``amendment made by
paragraph (1)''.
(B) Section 1848(f)(2)(C) (42 U.S.C. 1395w-4(f)(2)(C)) is amended
by inserting ``Performance standard rates of increase for fiscal year
1991.--'' after ``(C)''.
(C) Section 4105(d) of OBRA-1990 is amended by inserting
``Publication of Performance Standard Rates.--'' after ``(d)''.
(3) Section 1842(b)(4)(F) (42 U.S.C. 1395u(b)(4)(F)) is amended--
(A) in clause (i), by striking ``prevailing charge'' the
first place it appears and inserting ``customary charge''; and
(B) in clause (ii)(III), by striking ``second, third, and
fourth'' and inserting ``first, second, and third''.
(4) Section 1842(b)(4)(F)(ii)(I) (42 U.S.C. 1395u(b)(4)(F)(ii)(I))
is amended by striking ``respiratory therapist,''.
(5) Section 4106(c) of OBRA-1990 is amended by inserting ``of the
Social Security Act'' after ``1848(d)(1)(B)''.
(6) Section 4114 of OBRA-1990 is amended by striking ``patients''
the second place it appears.
(7) Section 1848(e)(1)(C) (42 U.S.C. 1395w-4(e)(1)(C)) is amended
by inserting ``date of the'' after ``since the''.
(8) Section 4118(f)(1)(D) of OBRA-1990 is amended by striking ``is
amended''.
(9) Section 4118(f)(1)(N)(ii) of OBRA-1990 is amended by striking
``subsection (f)(5)(A)'' and inserting ``subsection (f)(5)(A))''.
(10) Section 1845(e) (42 U.S.C. 1395w-1(e)) is amended--
(A) by striking paragraph (2); and
(B) by redesignating paragraphs (3), (4), and (5) as
paragraphs (2), (3), and (4).
(11) Section 4118(j)(2) of OBRA-1990 is amended by striking ``In
section'' and inserting ``Section''.
(12)(A) Section 1848(i)(3) (42 U.S.C. 1395w-4(i)(3)) is amended by
striking the space before the period at the end.
(B) Section 1834(a)(10)(B) (42 U.S.C. 1395m(a)(10)(B)) is amended--
(i) by striking ``apply to'' and inserting ``would
otherwise apply to'', and
(ii) by inserting before the period at the end ``but for
the application of section 1848(i)(3)''.
(j) Effective Date.--The amendments made by this section and the
provisions of this section shall take effect as if included in the
enactment of OBRA-1990.
Subchapter C--Ambulatory Surgical Center Services
SEC. 13451. DESIGNATION OF CERTAIN HOSPITALS AS EYE OR EYE AND EAR
HOSPITALS.
(a) In General.--Section 1833(i) (42 U.S.C. 1395l(i)) is amended--
(1) in subparagraph (B)(ii)--
(A) by striking ``the last sentence of this
clause'' and inserting ``paragraph (4)'', and
(B) by striking the last sentence; and
(2) by inserting after paragraph (3) the following new
paragraph:
``(4)(A) In the case of a hospital that--
``(i) makes application to the Secretary and demonstrates
that it specializes in eye services or eye and ear services (as
determined by the Secretary),
``(ii) receives more than 30 percent of its total revenues
from outpatient services, and
``(iii) on October 1, 1987--
``(I) was an eye specialty hospital or an eye and
ear specialty hospital, or
``(II) was operated as an eye or eye and ear unit
(as defined in subparagraph (B)) of a general acute
care hospital which, on the date of the application
described in clause (i), operates less than 20 percent
of the beds that the hospital operated on October 1,
1987, and has sold or otherwise disposed of a
substantial portion of the hospital's other acute care
operations,
the cost proportion and ASC proportion in effect under subclauses (I)
and (II) of paragraph (2)(B)(ii) for cost reporting periods beginning
in fiscal year 1988 shall remain in effect for cost reporting periods
beginning on or after October 1, 1988, and before January 1, 1995.
``(B) For purposes of this subparagraph (A)(iii)(II), the term `eye
or eye and ear unit' means a physically separate or distinct unit
containing separate surgical suites devoted solely to eye or eye and
ear services.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to portions of cost reporting periods beginning on or after
January 1, 1994.
SEC. 13452. TREATMENT OF INTRAOCULAR LENSES.
(a) Extension of Cap on Payments Through 1994.--
(1) In general.--Section 4151(c)(3) of OBRA-1990 is amended
by striking ``December 31, 1992'' and inserting ``December 31,
1994''.
(2) Effective date.--The amendment made by paragraph (1)
this subsection shall be effective as if included in the
enactment of OBRA-1990.
(b) Study of Costs of Intraocular Lenses.--
(1) Study.--The Secretary of Health and Human Services
shall conduct a study, based on recent data, of the acquisition
costs to providers of intraocular lenses provided to
individuals enrolled under part B of the medicare program and
shall include in the study an analysis of the impact of the
availability of new technology lenses on such costs.
(2) Report.--Not later than 1 year after the date of the
enactment of this Act, the Secretary shall submit a report on
the study conducted under paragraph (1) to the Committee on
Finance of the Senate and the Committees on Ways and Means and
Energy and Commerce of the House of Representatives, and shall
include in the report any recommendations the Secretary
considers appropriate regarding the determination of payment
amounts for intraocular lenses under part B of the medicare
program.
SEC. 13453. TECHNICAL AMENDMENTS.
(a) Payment Amounts for Services Furnished in Ambulatory Surgical
Centers.--
(1) Use of survey to determine incurred costs.--Section
1833(i)(2)(A)(i) (42 U.S.C. 1395l(i)(2)(A)(i)) is amended by
striking the comma at the end and inserting the following: ``,
as determined in accordance with a survey (based upon a
representative sample of procedures and facilities) taken not
later than January 1, 1994, and every 5 years thereafter, of
the actual audited costs incurred by such centers in providing
such services,''.
(2) Automatic application of inflation adjustment.--Section
1833(i)(2) (42 U.S.C. 1395l(i)(2)) is amended--
(A) in the second sentence of subparagraph (A) and
the second sentence of subparagraph (B), by striking
``and may be adjusted by the Secretary, when
appropriate,''; and
(B) by adding at the end the following new
subparagraph:
``(C) Notwithstanding the second sentence of subparagraph (A) or
the second sentence of subparagraph (B), if the Secretary has not
updated amounts established under such subparagraphs with respect to
facility services furnished during a fiscal year (beginning with fiscal
year 1995), such amounts shall be increased by the percentage increase
in the consumer price index for all urban consumers (U.S. city average)
for the 12-month period ending with March of the preceding fiscal
year.''.
(3) Consultation requirement.--The second sentence of
section 1833(i)(1) (42 U.S.C. 1395l(i)(1)) is amended by
striking the period and inserting the following: ``, in
consultation with appropriate trade and professional
organizations.''.
(b) Adjustments to Payment Amounts for New Technology Intraocular
Lenses.--
(1) Establishment of process for review of amounts.--Not
later than 1 year after the date of the enactment of this Act,
the Secretary of Health and Human Services (in this subsection
referred to as the ``Secretary'') shall develop and implement a
process under which interested parties may request review by
the Secretary of the appropriateness of the reimbursement
amount provided under section 1833(i)(2)(A)(iii) of the Social
Security Act with respect to a class of new technology
intraocular lenses. For purposes of the preceding sentence, an
intraocular lens may not be treated as a new technology lens
unless it has been approved by the Food and Drug
Administration.
(2) Factors considered.--In determining whether to provide
an adjustment of payment with respect to a particular lens
under paragraph (1), the Secretary shall take into account
whether use of the lens is likely to result in reduced risk of
intraoperative or postoperative complication or trauma,
accelerated postoperative recovery, reduced induced
astigmatism, improved postoperative visual acuity, more stable
postoperative vision, or other comparable clinical advantages.
(3) Notice and comment.--The Secretary shall publish notice
in the Federal Register from time to time (but no less often
than once each year) of a list of the requests that the
Secretary has received for review under this subsection, and
shall provide for a 30-day comment period on the lenses that
are the subjects of the requests contained in such notice. The
Secretary shall publish a notice of his determinations with
respect to intraocular lenses listed in the notice within 90
days after the close of the comment period.
(4) Effective date of adjustment.--Any adjustment of a
payment amount (or payment limit) made under this subsection
shall become effective not later than 30 days after the date on
which the notice with respect to the adjustment is published
under paragraph (3).
(c) Technical Correction Relating to Blend Amounts for Ambulatory
Surgical Center Payments.--
(1) In general.--Subclauses (I) and (II) of section
1833(i)(3)(B)(ii) (42 U.S.C. 1395l(i)(3)(B)(ii)) are each
amended--
(A) by striking ``for reporting'' and inserting
``for portions of cost reporting''; and
(B) by striking ``and on or before'' and inserting
``and ending on or before''.
(2) Effective date.--The amendments made by paragraph (1)
shall take effect as if included in the enactment of OBRA-1990.
(d) Technical Correction Related to Cataract Surgery.--Effective as
if included in the enactment of OBRA-1990, section 4151(c)(3) of such
Act is amended by striking ``for the insertion of an intraocular lens''
and inserting ``for an intraocular lens inserted''.
Subchapter D--Durable Medical Equipment
SEC. 13461. CERTIFICATION OF SUPPLIERS.
(a) Requirements.--
(1) In general.--Section 1834 (42 U.S.C. 1395m) is amended
by adding at the end the following new subsection:
``(i) Requirements for Suppliers of Medical Equipment and
Supplies.--
``(1) Issuance and renewal of supplier number.--
``(A) Payment.--Except as provided in subparagraph
(C), no payment may be made under this part after
October 1, 1993, for items furnished by a supplier of
medical equipment and supplies unless such supplier
obtains (and renews at such intervals as the Secretary
may require) a supplier number.
``(B) Standards for possessing a supplier number.--
A supplier may not obtain a supplier number unless--
``(i) for medical equipment and supplies
furnished on or after October 1, 1993, and on
or before December 31, 1994, the supplier meets
standards prescribed by the Secretary; and
``(ii) for medical equipment and supplies
furnished on or after January 1, 1995, the
supplier meets revised standards prescribed by
the Secretary (in consultation with
representatives of suppliers of medical
equipment and supplies, carriers, and
consumers) that shall include requirements that
the supplier--
``(I) comply with all applicable
State and Federal licensure and
regulatory requirements;
``(II) maintain a physical facility
on an appropriate site;
``(III) have proof of appropriate
liability insurance; and
``(IV) meet such other requirements
as the Secretary may specify.
``(C) Exception for items furnished as incident to
a physician's service.--Subparagraph (A) shall not
apply with respect to medical equipment and supplies
furnished as an incident to a physician's service.
``(D) Prohibition against multiple supplier
numbers.--The Secretary may not issue more than one
supplier number to any supplier of medical equipment
and supplies unless the issuance of more than one
number is appropriate to identify subsidiary or
regional entities under the supplier's ownership or
control.
``(E) Prohibition against delegation of supplier
determinations.--The Secretary may not delegate (other
than by contract under section 1842) the responsibility
to determine whether suppliers meet the standards
necessary to obtain a supplier number.
``(2) Certificates of medical necessity.--
``(A) Standardized certificates.--Not later than
October 1, 1993, the Secretary shall, in consultation
with carriers under this part, develop one or more
standardized certificates of medical necessity (as
defined in subparagraph (C)) for medical equipment and
supplies for which the Secretary determines that such a
certificate is necessary.
``(B) Prohibition against distribution by suppliers
of certificates of medical necessity.--
``(i) In general.--Except as provided in
clause (ii), a supplier of medical equipment
and supplies may not distribute to physicians
or to individuals entitled to benefits under
this part for commercial purposes any completed
or partially completed certificates of medical
necessity on or after October 1, 1993.
``(ii) Exception for certain billing
information.--Clause (i) shall not apply with
respect to a certificate of medical necessity
for any item that is not contained on the list
of potentially overused items developed by the
Secretary under subsection (a)(15)(A) to the
extent that such certificate contains only
information completed by the supplier of
medical equipment and supplies identifying such
supplier and the beneficiary to whom such
medical equipment and supplies are furnished, a
description of such medical equipment and
supplies, any product code identifying such
medical equipment and supplies, and any other
administrative information (other than
information relating to the beneficiary's
medical condition) identified by the Secretary.
In the event a supplier provides a certificate
of medical necessity containing information
permitted under this clause, such certificate
shall also contain the fee schedule amount and
the supplier's charge for the medical equipment
or supplies being furnished prior to
distribution of such certificate to the
physician.
``(iii) Penalty.--Any supplier of medical
equipment and supplies who knowingly and
willfully distributes a certificate of medical
necessity in violation of clause (i) is subject
to a civil money penalty in an amount not to
exceed $1,000 for each such certificate of
medical necessity so distributed. The
provisions of section 1128A (other than
subsections (a) and (b)) shall apply to civil
money penalties under this subparagraph in the
same manner as they apply to a penalty or
proceeding under section 1128A(a).
``(C) Definition.--For purposes of this paragraph,
the term `certificate of medical necessity' means a
form or other document containing information required
by the Secretary to be submitted to show that a covered
item is reasonable and necessary for the diagnosis or
treatment of illness or injury or to improve the
functioning of a malformed body member.
``(3) Coverage and review criteria.--
``(A) Development and establishment.--Not later
than January 1, 1995, the Secretary, in consultation
with representatives of suppliers of medical equipment
and supplies, individuals enrolled under this part, and
appropriate medical specialty societies, shall develop
and establish uniform national coverage and utilization
review criteria for 200 items of medical equipment and
supplies selected in accordance with the standards
described in subparagraph (B). The Secretary shall
publish the criteria as part of the instructions
provided to fiscal intermediaries and carriers under
this part and no further publication, including
publication in the Federal Register, shall be required.
``(B) Standards for selecting items subject to
criteria.--The Secretary may select an item for
coverage under the criteria developed and established
under subparagraph (A) if the Secretary finds that--
``(i) the item is frequently purchased or
rented by beneficiaries;
``(ii) the item is frequently subject to a
determination that such item is not medically
necessary; or
``(iii) the coverage or utilization
criteria applied to the item (as of the date of
the enactment of this subsection) is not
consistent among carriers.
``(C) Annual review and expansion of items subject
to criteria.--The Secretary shall annually review the
coverage and utilization of items of medical equipment
and supplies to determine whether items not included
among the items selected under subparagraph (A) should
be made subject to uniform national coverage and
utilization review criteria, and, if appropriate, shall
develop and apply such criteria to such additional
items.
``(4) Definition.--The term `medical equipment and
supplies'' means--
``(A) durable medical equipment (as defined in
section 1861(n));
``(B) prosthetic devices (as described in section
1861(s)(8));
``(C) orthotics and prosthetics (as described in
section 1861(s)(9));
``(D) surgical dressings (as described in section
1861(s)(5));
``(E) such other items as the Secretary may
determine; and
``(F) for purposes of paragraphs (1) and (3)--
``(i) home dialysis supplies and equipment
(as described in section 1861(s)(2)(F)), and
``(ii) immunosuppressive drugs (as
described in section 1861(s)(2)(J)).''.
(2) Conforming amendment.--Effective October 1, 1993, paragraph
(16) of section 1834(a) (42 U.S.C. 1395m(a)) is repealed.
(b) Report on Effect of Uniform Criteria on Utilization of Items.--
Not later than July 1, 1995, the Secretary shall submit a report to the
Committee on Ways and Means and the Committee on Energy and Commerce of
the House of Representatives and the Committee on Finance of the Senate
analyzing the impact of the uniform criteria established under section
1834(i)(3)(A) of the Social Security Act (as added by subsection (a))
on the utilization of items of medical equipment and supplies by
individuals enrolled under part B of the medicare program.
(c) Use of Covered Items by Disabled Beneficiaries.--
(1) In general.--The Secretary of Health and Human Services
in consultation with representatives of suppliers of durable
medical equipment under part B of the medicare program and
individuals entitled to benefits under such program on the
basis of disability, shall conduct a study of the effects of
the methodology for determining payments for items of such
equipment under such part on the ability of such individuals to
obtain items of such equipment, including customized items.
(2) Report.--Not later than May 1, 1994, the Secretary
shall submit a report to Congress on the study conducted under
paragraph (1), and shall include in the report such
recommendations as the Secretary considers appropriate to
assure that disabled medicare beneficiaries have access to
items of durable medical equipment.
(d) Criteria for Treatment of Items as Prosthetics Devices or
Orthotics and Prosthetics.--Not later than July 1, 1994, the Secretary
of Health and Human Services shall submit a report to the Committees on
Ways and Means and Energy and Commerce of the House of Representatives
and the Committee on Finance of the Senate describing prosthetic
devices or orthotics and prosthetics covered under part B of the
medicare program that do not require individualized or custom fitting
and adjustment to be used by a patient. Such report shall include
recommendations for an appropriate methodology for determining the
amount of payment for such items under such program.
SEC. 13462. PROHIBITION AGAINST CARRIER FORUM SHOPPING.
(a) In General.--Section 1834(a)(12) (42 U.S.C. 1395m(a)(12)) is
amended to read as follows:
``(12) Use of carriers to process claims.--
``(A) Designation of regional carriers.--The
Secretary may designate, by regulation under section
1842, one carrier for one or more entire regions to
process all claims within the region for covered items
under this section.
``(B) Prohibition against carrier shopping.--(i) No
supplier of a covered item may present or cause to be
presented a claim for payment under this part unless
such claim is presented to the appropriate regional
carrier (as designated by the Secretary).
``(ii) For purposes of clause (i), the term
`appropriate regional carrier' means the carrier having
jurisdiction over the geographic area that includes the
permanent residence of the patient to whom the item is
furnished.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to items furnished on or after October 1, 1993.
(c) Clarification of Authority to Designate Carriers for Other
Items and Services.--Nothing in this subsection or the amendment made
by this subsection may be construed to restrict the authority of the
Secretary of Health and Human Services to designate regional carriers
or modify claims jurisdiction rules with respect to items or services
under part B of the medicare program that are not covered items under
section 1834(a) of the Social Security Act or prosthetic devices or
orthotics and prosthetics under section 1834(h) of such Act.
SEC. 13463. RESTRICTIONS ON CERTAIN MARKETING AND SALES ACTIVITIES.
(a) Prohibiting Unsolicited Telephone Contacts From Suppliers of
Durable Medical Equipment to Medicare Beneficiaries.--
(1) In general.--Section 1834(a) (42 U.S.C. 1395m(a)) is
amended by adding at the end the following new paragraph:
``(17) Prohibition against unsolicited telephone contacts
by suppliers.--
``(A) In general.--A supplier of a covered item
under this subsection may not contact an individual
enrolled under this part by telephone regarding the
furnishing of a covered item to the individual (other
than a covered item the supplier has already furnished
to the individual) unless--
``(i) the individual gives permission to
the supplier to make contact by telephone for
such purpose; or
``(ii) the supplier has furnished a covered
item under this subsection to the individual
during the 15-month period preceding the date
on which the supplier contacts the individual
for such purpose.
``(B) Prohibiting payment for items furnished
subsequent to unsolicited contacts.--If a supplier
knowingly contacts an individual in violation of
subparagraph (A), no payment may be made under this
part for any item subsequently furnished to the
individual by the supplier.
``(C) Exclusion from program for suppliers engaging
in pattern of unsolicited contacts.--If a supplier
knowingly contacts individuals in violation of
subparagraph (A) to such an extent that the supplier's
conduct establishes a pattern of contacts in violation
of such subparagraph, the Secretary shall exclude the
supplier from participation in the programs under this
Act, in accordance with the procedures set forth in
subsections (c), (f), and (g) of section 1128.''.
(2) Requiring refund of amounts collected for disallowed
items.--Section 1834(a) (42 U.S.C. 1395m(a)), as amended by
paragraph (1), is amended by adding at the end the following
new paragraph:
``(18) Refund of amounts collected for certain disallowed
items.--
``(A) In general.--If a nonparticipating supplier
furnishes to an individual enrolled under this part a
covered item for which no payment may be made under
this part by reason of paragraph (17)(B), the supplier
shall refund on a timely basis to the patient (and
shall be liable to the patient for) any amounts
collected from the patient for the item, unless--
``(i) the supplier establishes that the
supplier did not know and could not reasonably
have been expected to know that payment may not
be made for the item by reason of paragraph
(17)(B), or
``(ii) before the item was furnished, the
patient was informed that payment under this
part may not be made for that item and the
patient has agreed to pay for that item.
``(B) Sanctions.--If a supplier knowingly and
willfully fails to make refunds in violation of
subparagraph (A), the Secretary may apply sanctions
against the supplier in accordance with section
1842(j)(2).
``(C) Notice.--Each carrier with a contract in
effect under this part with respect to suppliers of
covered items shall send any notice of denial of
payment for covered items by reason of paragraph
(17)(B) and for which payment is not requested on an
assignment-related basis to the supplier and the
patient involved.
``(D) Timely basis defined.--A refund under
subparagraph (A) is considered to be on a timely basis
only if--
``(i) in the case of a supplier who does
not request reconsideration or seek appeal on a
timely basis, the refund is made within 30 days
after the date the supplier receives a denial
notice under subparagraph (C), or
``(ii) in the case in which such a
reconsideration or appeal is taken, the refund
is made within 15 days after the date the
supplier receives notice of an adverse
determination on reconsideration or appeal.''.
(b) Conforming Amendment.--Section 1834(h)(3) (42 U.S.C.
1395m(h)(3)) is amended by striking ``Paragraph (12)'' and inserting
``Paragraphs (12) and (17)''.
(c) Effective Date.--The amendments made by subsections (a) and (b)
shall apply to items furnished after the expiration of the 60-day
period that begins on the date of the enactment of this Act.
SEC. 13464. ANTI-KICKBACK CLARIFICATION.
(a) In General.--Section 1128B(b)(3)(B) (42 U.S.C. 1320a-
7b(b)(3)(B)) is amended by inserting before the semicolon ``(except
that in the case of a contract supply arrangement between any entity
and a supplier of medical supplies and equipment (as defined in section
1834(i)(4), but not including items described in subparagraph (F) of
such section), such employment shall not be considered bona fide to the
extent that it includes tasks of a clerical and cataloging nature in
transmitting to suppliers assignment rights of individuals eligible for
benefits under part B of title XVIII, or performance of warehousing or
stock inventory functions)''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply with respect to services furnished on or after the first day of
the first month that begins after the expiration of the 60-day period
beginning on the date of the enactment of this Act.
SEC. 13465. LIMITATIONS ON BENEFICIARY LIABILITY FOR NONCOVERED
SERVICES.
(a) In General.--Section 1834(i) (42 U.S.C. 1395m(i)), as added by
section 13461(a)(1), is amended--
(1) by redesignating paragraph (4) as paragraph (5), and
(2) by inserting after paragraph (3) the following new
paragraph:
``(4) Limitation on patient liability.--If a supplier of
medical equipment and supplies (as defined in paragraph (5))--
``(A) furnishes an item or service to a beneficiary
for which no payment may be made by reason of paragraph
(1);
``(B) furnishes an item or service to a beneficiary
for which payment is denied in advance under subsection
(a)(15); or
``(C) furnishes an item or service to a beneficiary
for which payment is denied under section 1862(a)(1);
any expenses incurred for items and services furnished to an
individual by such a supplier not on an assigned basis shall be
the responsibility of such supplier. The individual shall have
no financial responsibility for such expenses and the supplier
shall refund on a timely basis to the individual (and shall be
liable to the individual for) any amounts collected from the
individual for such items or services. The provisions of
subsection (a)(18) shall apply to refunds required under the
previous sentence in the same manner as such provisions apply
to refunds under such subsection.''.
(2) Conforming amendment.--Section 1128B(b)(3)(B) (42
U.S.C. 1320a-7b(b)(3)(B)), as amended by section 13464(a), is
amended by striking ``1834(i)(4)'' and inserting
``1834(i)(5)''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to items or services furnished on or after October 1, 1993.
SEC. 13466. ADJUSTMENTS FOR INHERENT REASONABLENESS.
(a) Adjustments Made to Final Payment Amounts.--
(1) In general.--Section 1834(a)(10)(B) (42 U.S.C.
1395m(a)(10)(B)) is amended by adding at the end the following:
``In applying such provisions to payments for an item under
this subsection, the Secretary shall make adjustments to the
payment basis for the item described in paragraph (1)(B) if the
Secretary determines (in accordance with such provisions and on
the basis of prices and costs applicable at the time the item
is furnished) that such payment basis is not inherently
reasonable.''.
(2) Effective date.--The amendment made by paragraph (1)
shall take effect on the date of the enactment of this Act.
(b) Adjustment Required for Certain Items.--
(1) In general.--In accordance with section 1834(a)(10)(B)
of the Social Security Act (as amended by subsection (a)), the
Secretary of Health and Human Services shall determine whether
the payment amounts for the items described in paragraph (2)
are not inherently reasonable, and shall adjust such amounts in
accordance with such section if the amounts are not inherently
reasonable.
(2) Items described.--The items referred to in paragraph
(1) are decubitus care equipment, transcutaneous electrical
nerve stimulators, and any other items considered appropriate
by the Secretary.
SEC. 13467. TREATMENT OF NEBULIZERS AND ASPIRATORS.
(a) In General.--Section 1834(a)(3)(A) (42 U.S.C. 1395m(a)(3)(A))
is amended by striking ``ventilators, aspirators, IPPB machines, and
nebulizers'' and inserting ``ventilators and IPPB machines''.
(b) Payment for Accessories Relating to Nebulizers and
Aspirators.--Section 1834(a)(2)(A) (42 U.S.C. 1395m(a)) is amended--
(1) by striking ``or'' at the end of clause (i),
(2) by adding ``or'' at the end of clause (ii), and
(3) by inserting after clause (ii) the following new
clause:
``(iii) which is an accessory used in
conjunction with a nebulizer or aspirator,''.
(c) Effective Date.--The amendments made by this section shall
apply to items furnished on or after January 1, 1994.
SEC. 13468. PAYMENT FOR OSTOMY SUPPLIES AND OTHER SUPPLIES.
(a) Ostomy Supplies, Tracheostomy Supplies, and Urologicals.--
(1) In general.--Section 1834(h)(1) (42 U.S.C. 1395m(h)(1))
is amended by adding at the end the following new subparagraph:
``(E) Exception for certain items.--Payment for
ostomy supplies, tracheostomy supplies, and urologicals
shall be made in accordance with subparagraphs (B) and
(C) of section 1834(a)(2).''.
(2) Conforming amendment.--Section 1834(h)(1)(B) (42 U.S.C.
1395m(h)(1)(B)) is amended by striking ``subparagraph (C),''
and inserting ``subparagraphs (C) and (E),''.
(3) Effective date.--The amendments made by this subsection
shall apply to items furnished on or after January 1, 1994.
(b) Surgical Dressings.--
(1) In general.--Section 1834 (42 U.S.C. 1395m), as amended
by section 13461(a), is amended by adding at the end the
following new subsection:
``(j) Payment for Surgical Dressings.--
``(1) In general.--Payment under this subsection for
surgical dressings (described in section 1861(s)(5)) shall be
made in a lump sum amount for the purchase of the item in an
amount equal to 80 percent of the lesser of--
``(A) the actual charge for the item; or
``(B) a payment amount determined in accordance
with the methodology described in subparagraphs (B) and
(C) of subsection (a)(2) (except that in applying such
methodology, the national limited payment amount
referred to in such subparagraphs shall be initially
computed based on local payment amounts using average
reasonable charges for the 12-month period ending
December 31, 1992, increased by the covered item
updates described in such subsection for 1993 and
1994).
``(2) Exceptions.--Paragraph (1) shall not apply to
surgical dressings that are--
``(A) furnished as an incident to a physician's
professional service; or
``(B) furnished by a home health agency.''.
(2) Conforming amendment.--Section 1833(a)(1) (42 U.S.C.
1395l(a)(1)), as amended by sections 13478(e)(2) and
13445(e)(1), is amended--
(A) by striking ``and'' before ``(P)'', and
(B) by inserting before the semicolon at the end
the following: ``, and (Q) with respect to surgical
dressings, the amounts paid shall be the amounts
determined under section 1834(j);''.
(3) Effective date.--The amendments made by this subsection
shall apply to items furnished on or after January 1, 1994.
(c) Reduction in Payments for TENS Devices.--
(1) In general.--Section 1834(a)(1)(D) (42 U.S.C.
1395m(a)(1)(D)) is amended by striking ``15 percent'' the
second place it appears and inserting ``45 percent''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to items furnished on or after January 1, 1994.
SEC. 13469. MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Updates to Payment Amounts.--Subparagraph (A) of section
1834(a)(14) (42 U.S.C. 1395m(a)(14)) is amended to read as follows:
``(A) for 1991 and 1992, the percentage increase in
the consumer price index for all urban consumers (U.S.
city average) for the 12-month period ending with June
of the previous year reduced by 1 percentage point;
and''.
(b) Treatment of Potentially Overused Items and Advanced
Determinations of Coverage.--
(1) In general.--Effective on the date of the enactment of
this Act, section 1834(a)(15) (42 U.S.C. 1395m(a)(15)) is
amended to read as follows:
``(15) Special treatment for potentially overused items.--
``(A) Development of list of items by secretary.--
The Secretary shall develop and periodically update a
list of items for which payment may be made under this
subsection that are potentially overused, and shall
include in such list seat-lift mechanisms,
transcutaneous electrical nerve stimulators, motorized
scooters, decubitus care mattresses, and any such other
item determined by the Secretary to be potentially
overused on the basis of any of the following
criteria--
``(i) the item is marketed directly to
potential patients;
``(ii) the item is marketed with an offer
to potential patients to waive the costs of
coinsurance associated with the item or is
marketed as being available at no cost to
policyholders of a medicare supplemental policy
(as defined in section 1882(g)(1));
``(iii) the item has been subject to a
consistent pattern of overutilization; or
``(iv) a high proportion of claims for
payment for such item under this part may not
be made because of the application of section
1862(a)(1).
``(B) Items subject to special carrier scrutiny.--
Payment may not be made under this part for any item
contained in the list developed by the Secretary under
subparagraph (A) unless the carrier has subjected the
claim for payment for the item to special scrutiny or
has followed the procedures described in paragraph
(11)(C) with respect to the item.''.
(2) Advance determination by carriers.--Effective January
1, 1994, section 1834(a)(11) (42 U.S.C. 1395m(a)) is amended by
adding at the end the following new subparagraph:
``(C) Carrier determinations for certain items in
advance.--A carrier shall determine in advance whether
payment for an item may not be made under this
subsection because of the application of section
1862(a)(1) if--
``(i) the item is a customized item (other
than inexpensive items specified by the
Secretary); or
``(ii) the item is a specified covered item
under subparagraph (B).''.
(3) Inclusion in carrier performance evaluations.--
Effective for standards applied for contract years beginning
after the date of the enactment of this Act, section 1842(c)
(42 U.S.C. 1395u(c)), as amended by section 13448(a), is
amended by adding at the end the following new paragraph:
``(5) Each contract under this section which provides for the
disbursement of funds, as described in subsection (a)(1)(B), shall
require the carrier to meet criteria developed by the Secretary to
measure the timeliness of carrier responses to requests for payment of
items described in section 1834(a)(11)(C).''.
(4) Application to prosthetic devices and orthotics and
prosthetics.--Section 1834(h)(3) (42 U.S.C. 1395m(h)(3)) is
amended by striking ``paragraph (10) and paragraph (11)'' and
inserting ``paragraphs (10) and (11)''.
(c) Study of Variations in Durable Medical Equipment Supplier
Costs.--
(1) Collection and analysis of supplier cost data.--The
Administration of the Health Care Financing Administration
shall, in consultation with appropriate organizations, collect
data on supplier costs of durable medical equipment for which
payment may be made under part B of the medicare program, and
shall analyze such data to determine the proportions of such
costs attributable to the service and product components of
furnishing such equipment and the extent to which such
proportions vary by type of equipment and by the geographic
region in which the supplier is located.
(2) Development of geographic adjustment index; reports.--
Not later than January 1, 1995--
(A) the Administrator shall submit a report to the
Committees on Energy and Commerce and Ways and Means of
the House of Representatives and the Committee on
Finance of the Senate on the data collected and the
analysis conducted under paragraph (1), and shall
include in such report the Administrator's
recommendations for a geographic cost adjustment index
for suppliers of durable medical equipment under the
medicare program and an analysis of the impact of such
proposed index on payments under the medicare program;
and
(B) the Comptroller General shall submit a report
to the Committees on Energy and Commerce and Ways and
Means of the House of Representatives and the Committee
on Finance of the Senate analyzing on a geographic
basis the supplier costs of durable medical equipment
under the medicare program.
(d) Oxygen Retesting.--Section 1834(a)(5)(E) (42 U.S.C.
1395m(a)(5)(E)) is amended by striking ``55'' and inserting ``56''.
(e) Other Miscellaneous and Technical Amendments.--(1) Section
4152(a)(3) of OBRA-1990 is amended by striking ``amendment made by
subsection (a)'' and inserting ``amendments made by this subsection''.
(2) Section 4152(c)(2) of OBRA-1990 is amended by striking
``1395m(a)(7)(A)'' and inserting ``1395m(a)(7)''.
(3) Section 1834(a)(7)(A)(iii)(II) (42 U.S.C.
1395m(a)(7)(A)(iii)(II)) is amended by striking ``clause (v)'' and
inserting ``clause (vi)''.
(4) Section 1834(a)(7)(C)(i) (42 U.S.C. 1395m(a)(7)(C)(i)) is
amended by striking ``or paragraph (3)''.
(5) Section 1834(a)(3) (42 U.S.C. 1395m(a)(3)) is amended by
striking subparagraph (D).
(6) Section 4153(c)(1) of OBRA-1990 is amended by striking
``1834(a)'' and inserting ``1834(h)''.
(7) Section 4153(d)(2) of OBRA-1990 is amended by striking
``Reconiliation'' and inserting ``Reconciliation''.
(8)(A) Section 1834(a) (42 U.S.C. 1395m(a)) is amended by striking
paragraph (6).
(B) Section 1834(a) (42 U.S.C. 1395m(a)) is amended--
(i) in subparagraphs (A) and (B) of paragraph (1), by
striking ``(2) through (7)'' each place it appears and
inserting ``(2) through (5) and (7)'';
(ii) in paragraph (7), by striking ``(2) through (6)'' and
inserting ``(2) through (5)'';
(iii) in paragraph (8), by striking ``paragraphs (6) and
(7)'' each place it appears in the matter preceding
subparagraph (A) and in subparagraph (C) and inserting
``paragraph (7)''; and
(iv) in paragraph (8)(A)(i), by striking ``described--''
and all that follows and inserting ``described in paragraph (7)
equal to the average of the purchase prices on the claims
submitted on an assignment-related basis for the unused item
supplied during the 6-month period ending with December
1986.''.
(9) The amendments made by this subsection shall take effect as if
included in the enactment of OBRA-1990.
Subchapter E--Other Provisions
SEC. 13471. CLARIFYING PAYMENTS FOR MEDICALLY DIRECTED CERTIFIED
REGISTERED NURSE ANESTHETIST SERVICES.
(a) In General.--Section 1833(l)(4)(B) (42 U.S.C. 1395l(l)(4)(B))
is amended to read as follows:
``(B) Except as provided in subparagraph (D), the conversion factor
used to determine the amount paid under the fee schedule under this
subsection for services furnished by a certified registered nurse
anesthetist who is medically directed--
``(i) in a year after 1993 and before 1997, shall be
$10.75, or
``(ii) in a subsequent calendar year, shall be the previous
year's conversion factor increased by the update determined
under section 1848(d)(3) for physician anesthesia services for
that year.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to services furnished on or after January 1, 1994.
SEC. 13472. EXTENSION OF ALZHEIMER'S DISEASE DEMONSTRATION PROJECTS.
Section 9342 of OBRA-1986, as amended by section 4164(a)(2) of
OBRA-1990, is amended--
(1) in subsection (c)(1), by striking ``4 years'' and
inserting ``5 years''; and
(2) in subsection (f), --
(A) by striking ``$55,000,000'' and inserting
``$58,000,000'', and
(B) by striking ``$3,000,000'' and inserting
``$5,000,000''.
SEC. 13473. ORAL CANCER DRUGS.
(a) New Coverage of Certain Self-Administered Anticancer Drugs.--
Section 1861(s)(2) (42 U.S.C. 1395(s)(2)), as amended by section
13478(f)(8)(B), is amended--
(1) by striking ``and'' at the end of subparagraph (N);
(2) by adding ``and'' at the end of subparagraph (O); and
(3) by adding at the end the following new subparagraph:
``(P) an oral drug (which is approved by the Federal Food
and Drug Administration) prescribed for use as an anticancer
chemotherapeutic agent for a given indication, and containing
an active ingredient (or ingredients), which is the same
indication and active ingredient (or ingredients) as a drug
which the carrier determines would be covered pursuant to
subparagraph (A) or (B) if the drug could not be self-
administered;''.
(b) Uniform Coverage of ``Off-Label'' Anticancer Drugs.--Section
1861(t) (42 U.S.C. 1395x(t)) is amended--
(1) by inserting ``(1)'' after ``(t)'';
(2) by striking ``(m)(5) of this section'' and inserting
``(m)(5) and paragraph (2)''; and
(3) by adding at the end the following new paragraph:
``(2)(A) For purposes of paragraph (1), the term `drugs' also
includes any drugs or biologicals used in an anticancer
chemotherapeutic regimen for a medically accepted indication (as
described in subparagraph (B)).
``(B) In subparagraph (A), the term `medically accepted
indication', with respect to the use of a drug, includes any use which
has been approved by the Food and Drug Administration for the drug, and
includes another use of the drug if--
``(i) the drug has been approved by the Food and Drug
Administration, and
``(ii) the carrier involved determines, based upon guidance
provided by the Secretary to carriers for determining medically
accepted uses of drugs, that the use is medically accepted
taking into account the uses of such drug which are--
``(I) included (or approved for inclusion) in one
or more of the following compendia: the American
Hospital Formulary Service-Drug Information, the
American Medical Association Drug Evaluations, and the
United States Pharmacopoeia-Drug Information; or
``(II) supported by clinical evidence in peer
reviewed medical literature appearing in publications
which have been specifically approved for purposes of
this paragraph by the Secretary.''.
(c) Study of Medicare Coverage of Patient Care Costs Associated
With Clinical Trials of New Cancer Therapies.--
(1) Study.--The Secretary of Health and Human Services
shall conduct a study of the effects of expressly covering
under the medicare program the patient care costs for
beneficiaries enrolled in clinical trials of new cancer
therapies, where the protocol for the trial has been approved
by the National Cancer Institute or meets similar scientific
and ethical standards, including approval by an institutional
review board. The study shall include--
(A) an estimate of the cost of such coverage,
taking into account the extent to which medicare
currently pays for such patient care costs in practice;
(B) an assessment of the extent to which such
clinical trials represent the best available treatment
for the patients involved and of the effects of
participation in the trials on the health of such
patients;
(C) an assessment of whether progress in developing
new anticancer therapies would be assisted by medicare
coverage of such patient care costs; and
(D) an evaluation of whether there should be
special criteria for the admission of medicare
beneficiaries (on account of their age or physical
condition) to clinical trials for which medicare would
pay the patient care costs.
(2) Report.--Not later than 2 years after the date of the
enactment of this Act, the Secretary of Health and Human
Services shall submit a report on the study conducted under
paragraph (1) to the Committee on Ways and Means and the
Committee on Energy and Commerce of the House of
Representatives and the Committee on Finance of the Senate.
Such report shall include recommendations as to the coverage
under the medicare program of patient care costs of
beneficiaries enrolled in clinical trials of new cancer
therapies.
(d) Effective Date.--The amendments made by subsections (a) and (b)
shall apply to items furnished on or after January 1, 1994.
SEC. 13474. PART B PREMIUM PAYMENTS FOR LATE ENROLLMENT.
(a) Limitation on Medicare Part B Late Enrollment Penalty.--
(1) In general.--Section 1839 (42 U.S.C. 1395r) is amended
by adding at the end the following new subsection:
``(g) The percent increase in premiums under subsection (b) due to
late enrollment under this part shall not exceed 25 percent in the case
of an individual who is an annuitant described in subparagraph (A) or
(B) of section 8901(3) of title 5, United States Code (including an
individual or survivor described in section 8906(g)(2)(A) of such
title) for a month if--
``(1) during the individual's initial enrollment period
under section 1837(d)--
``(A) the individual was enrolled in a group health
plan (as defined in section 1862(b)(1)(A)(v)) that
provided coverage of items and services for which
payment may be made under this part, and
``(B) the individual elected not to enroll (or to
be deemed enrolled) under this section; and
``(2) due to a change of coverage under such plan, there is
no coverage during the month under such plan with respect to
items and services for which payment may be made under this
part unless the individual is enrolled under this part.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to premiums for months beginning with January 1992.
(b) Payment of Part B Premium Late Enrollment Penalties by
States.--Section 1839 (42 U.S.C. 1395r), as amended by subsection (a),
is further amended by adding at the end the following new subsection:
``(h)(1) Upon the request of a State, the Secretary may enter into
an agreement with the State under which the State agrees to pay on a
quarterly or other periodic basis to the Secretary (to be deposited in
the Treasury to the credit of the Federal Supplementary Medical
Insurance Trust Fund) an amount equal to the amount of the part B late
enrollment premium increases with respect to the premiums for eligible
individuals (as defined in paragraph (3)(A)).
``(2) No part B late enrollment premium increase shall apply to an
eligible individual for premiums for months for which the amount of
such an increase is payable under an agreement under paragraph (1).
``(3) In this subsection:
``(A) The term `eligible individual' means an individual
who is enrolled under this part B and who is within a class of
individuals specified in the agreement under paragraph (1).
``(B) The term `part B late enrollment premium increase'
means any increase in a premium as a result of the application
of subsection (b).''.
SEC. 13475. COVERAGE OF SERVICES OF SPEECH-LANGUAGE PATHOLOGISTS AND
AUDIOLOGISTS.
(a) Services Defined.--Section 1861 (42 U.S.C. 1395x), as amended
by section 13478(f)(8)(E), is amended by inserting after subsection
(kk) the following new subsection:
``Speech-Language Pathology Services; Audiology Services
``(ll)(1) The term `speech-language pathology services' means such
speech, language, and related function assessment and rehabilitation
services furnished by a qualified speech-language pathologist as the
speech-language pathologist is legally authorized to perform under
State law (or the State regulatory mechanism provided by State law) as
would otherwise be covered if furnished by a physician.
``(2) The term `audiology services' means such hearing and balance
assessment services furnished by a qualified audiologist as the
audiologist is legally authorized to perform under State law (or the
State regulatory mechanism provided by State law).
``(3) In this subsection:
``(A) The term `qualified speech-language pathologist'
means an individual with a master's or doctoral degree in
speech-language pathology who has performed not less than 9
months of supervised full-time speech-language pathology
services after obtaining such degree and who--
``(i) is licensed (or is otherwise certified) as a
speech-language pathologist by the State in which the
individual furnishes such services, or
``(ii) in the case of an individual who furnishes
services in a State which does not provide for the
licensing (or other form of certification) of speech-
language pathologists, has successfully completed a
national clinical competency examination in speech-
language pathology approved by the Secretary.
``(B) The term `qualified audiologist' means an individual
with a master's or doctoral degree in audiology who has
performed not less than 9 months of supervised full-time
audiology services after obtaining such degree and who--
``(i) is licensed (or is otherwise certified) as an
audiologist by the State in which the individual
furnishes such services, or
``(ii) in the case of an individual who furnishes
services in a State which does not provide for the
licensing (or other form of certification) of
audiologists, has successfully completed a national
clinical competency examination in audiology approved
by the Secretary.''.
(b) Conforming Amendments Relating to Medicare Treatment of Speech
and Language Services.--
(1) Extended care services.--Section 1861(h)(3) (42 U.S.C.
1395x(h)(3)) is amended by striking ``, occupational, or speech
therapy'' and inserting ``or occupational therapy or speech-
language pathology services''.
(2) Home health services.--Section 1861(m)(2) (42 U.S.C.
1395x(m)(2)) is amended by striking ``, occupational, or speech
therapy'' and inserting ``or occupational therapy or speech-
language pathology services''.
(3) Outpatient physical therapy services.--The fourth
sentence of section 1861(p) (42 U.S.C. 1395x(p)) is amended by
striking ``speech pathology services'' and inserting ``speech-
language pathology services''.
(4) Comprehensive outpatient rehabilitation facility
services.--Section 1861(cc)(1)(B) (42 U.S.C. 1395x(cc)(1)(B))
is amended by striking ``speech pathology services'' and
inserting ``speech-language pathology services''.
(5) Hospice care.--Section 1861(dd)(1)(B) (42 U.S.C.
1395x(dd)(1)(B)) is amended by striking ``therapy or speech-
language pathology'' and inserting ``therapy, or speech-
language pathology services''.
(c) Effective Date.--The amendments made by this section shall take
effect on January 1, 1994.
SEC. 13476. EXTENSION OF MUNICIPAL HEALTH SERVICE DEMONSTRATION
PROJECTS.
Section 9215 of the Consolidated Omnibus Budget Reconciliation Act
of 1985, as amended by section 6135 of OBRA-1989, is amended--
(1) by striking ``December 31, 1993'' and inserting
``December 31, 1997'', and
(2) in the second sentence, by inserting after
``beneficiary costs,'' the following: ``costs to the medicaid
program and other payers, access to care, outcomes, beneficiary
satisfaction, utilization differences among the different
populations served by the projects,''.
SEC. 13477. TREATMENT OF CERTAIN INDIAN HEALTH PROGRAMS AND FACILITIES
AS FEDERALLY-QUALIFIED HEALTH CENTERS.
(a) In General.--Section 1861(aa)(4) (42 U.S.C. 1395x(aa)(4)) is
amended--
(1) by striking ``or'' at the end of subparagraph (B);
(2) by striking the period at the end of subparagraph (C)
and inserting ``; or''; and
(3) by adding at the end the following new subparagraph:
``(D) is an outpatient health program or facility operated
by a tribe or tribal organization under the Indian Self-
Determination Act or by an urban Indian organization receiving
funds under title V of the Indian Health Care Improvement
Act.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to services furnished on or after January 1, 1994.
SEC. 13478. MISCELLANEOUS AND TECHNICAL CORRECTIONS.
(a) Revision of Information on Part B Claims Forms.--Section
1833(q)(1) (42 U.S.C. 1395l(q)(1)) is amended--
(1) by striking ``provider number'' and inserting ``unique
physician identification number''; and
(2) by striking ``and indicate whether or not the referring
physician is an interested investor (within the meaning of
section 1877(h)(5))''.
(b) Consultation for Social Workers.--Effective with respect to
services furnished on or after January 1, 1991, section 6113(c) of
OBRA-1989 is amended--
(1) by inserting ``and clinical social worker services''
after ``psychologist services''; and
(2) by striking ``psychologist'' the second and third place
it appears and inserting ``psychologist or clinical social
worker''.
(c) Reports on Hospital Outpatient Payment.--(1) OBRA-1989 is
amended by striking section 6137.
(2) Section 1135(d) (42 U.S.C. 1320b-5(d)) is amended--
(A) by striking paragraph (6); and
(B) in paragraph (7)--
(i) by striking ``systems'' each place it appears
and inserting ``system''; and
(ii) by striking ``paragraphs (1) and (6)'' and
inserting ``paragraph (1)''.
(d) Radiology and Diagnostic Services Provided in Hospital
Outpatient Departments.--(1) Effective as if included in the enactment
of OBRA-1989, section 1833(n)(1)(B)(i)(II) (42 U.S.C.
1395l(n)(1)(B)(i)(II)) is amended--
(A) by inserting ``and for services described in subsection
(a)(2)(E)(ii) furnished on or after January 1, 1992'' after
``1989''; and
(B) by striking ``1842(b)'' and inserting ``1842(b) (or, in
the case of services furnished on or after January 1, 1992,
under section 1848)''.
(2) Effective as if included in the enactment of OBRA-1989, section
1833(n)(1)(B)(i)(II) (42 U.S.C. 1395l(n)(1)(B)(i)(II)) is amended by
striking ``January 1, 1989'' and inserting ``April 1, 1989''.
(e) Payments to Nurse Practitioners in Rural Areas (Section 4155 of
OBRA-1990).--(1) Section 1861(s)(2)(K)(iii) (42 U.S.C.
1395x(s)(2)(K)(iii)) is amended--
(A) by striking ``subsection (aa)(3)'' and inserting
``subsection (aa)(5)''; and
(B) by striking ``subsection (aa)(4)'' and inserting
``subsection (aa)(6)''.
(2) Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)) is amended--
(A) by striking ``and'' before ``(N)''; and
(B) with respect to the matter inserted by section
4155(b)(2)(B) of OBRA-1990--
(i) by striking ``(M)'' and inserting ``, and
(O)'', and
(ii) by transferring and inserting it (as amended)
immediately before the semicolon at the end.
(3) Section 1833(r)(1) (42 U.S.C. 1395l(r)(1)) is amended--
(A) by striking ``ambulatory'' each place it appears and
inserting ``or ambulatory''; and
(B) by striking ``center,'' and inserting ``center''.
(4) Section 1833(r)(2)(A) (42 U.S.C. 1395l(r)(2)(A)) is amended by
striking ``subsection (a)(1)(M)'' and inserting ``subsection
(a)(1)(O)''.
(5) Section 1861(b)(4) (42 U.S.C. 1395x(b)(4)) is amended by
striking ``subsection (s)(2)(K)(i)'' and inserting ``clauses (i) or
(iii) of subsection (s)(2)(K)''.
(6) Section 1861(aa)(5) (42 U.S.C. 1395x(aa)(5)) is amended by
striking ``this Act'' and inserting ``this title''.
(7) Section 1862(a)(14) (42 U.S.C. 1395y(a)(14)) is amended by
striking ``1861(s)(2)(K)(i)'' and inserting ``1861(s)(2)(K)(i) or
1861(s)(2)(K)(iii)''.
(8) Section 1866(a)(1)(H) (42 U.S.C. 1395cc(a)(1)(H)) is amended by
striking ``1861(s)(2)(K)(i)'' and inserting ``1861(s)(2)(K)(i) or
1861(s)(2)(K)(iii)''.
(f) Other Miscellaneous and Technical Amendments.--
(1) Immediate enrollment in part b by individuals covered
by an employment-based plan.--(A) Subparagraphs (A) and (B) of
section 1837(i)(3) (42 U.S.C. 1395p(i)(3)) are each amended--
(i) by striking ``beginning with the first day of
the first month in which the individual is no longer
enrolled'' and inserting ``including each month during
any part of which the individual is enrolled''; and
(ii) by striking ``and ending seven months later''
and inserting ``ending with the last day of the eighth
consecutive month in which the individual is at no time
so enrolled''.
(B) Paragraphs (1) and (2) of section 1838(e) (42 U.S.C.
1395q(e)) are amended to read as follows:
``(1) in any month of the special enrollment period in
which the individual is at any time enrolled in a plan
(specified in subparagraph (A) or (B), as applicable, of
section 1837(i)(3)) or in the first month following such a
month, the coverage period shall begin on the first day of the
month in which the individual so enrolls (or, at the option of
the individual, on the first day of any of the following three
months), or
``(2) in any other month of the special enrollment period,
the coverage period shall begin on the first day of the month
following the month in which the individual so enrolls.''.
(C) The amendments made by subparagraphs (A) and (B) shall
take effect on the first day of the first month that begins
after the expiration of the 120-day period that begins on the
date of the enactment of this Act.
(2) Blend amounts for ambulatory surgical center
payments.--Subclauses (I) and (II) of section 1833(i)(3)(B)(ii)
(42 U.S.C. 1395l(i)(3)(B)(ii)) are each amended--
(A) by striking ``for reporting'' and inserting
``for portions of cost reporting''; and
(B) by striking ``and on or before'' and inserting
``and ending on or before''.
(3) Clinical diagnostic laboratory tests (section 4154 of
obra-1990).--Section 4154(e)(5) of OBRA-1990 is amended by
striking ``(1)(A)'' and inserting ``(1)(A),''.
(4) Separate payment under part b for certain services
(section 4157 of obra-1990).--Section 4157(a) of OBRA-1990 is
amended by striking ``(a) Services of'' and all that follows
through ``Section'' and inserting ``(a) Treatment of Services
of Certain Health Practitioners.--Section''.
(5) Certified registered nurse anesthetists (section 4160
of obra-1990).--Section 1833(l)(4)(B)(ii)(VII) (42 U.S.C.
1395l(l)(4)(B)(ii)(VII)) is amended by striking ``1997'' and
inserting ``1996''.
(6) Community health centers and rural health clinics
(section 4161 of obra-1990).--(A) The fourth sentence of
section 1861(aa)(2) (42 U.S.C. 1395x(aa)(2)) is amended--
(i) by striking ``certification'' the first place
it appears and inserting ``approval''; and
(ii) by striking ``the Secretary's approval or
disapproval of the certification'' and inserting
``Secretary's approval or disapproval''.
(B) Section 4161(a)(7)(B) of OBRA-1990 is amended by
inserting ``and to the Committee on Finance of the Senate''
after ``Representatives''.
(7) Screening mammography (section 4163 of obra-1990).--
Section 4163 of OBRA-1990 is amended--
(A) by adding at the end of subsection (d) the
following new paragraph:
``(3) The amendment made by paragraph (2)(A)(iv) shall
apply to screening pap smears performed on or after July 1,
1990.''; and
(B) in subsection (e), by striking ``The
amendments'' and inserting ``Except as provided in
subsection (d)(3), the amendments''.
(8) Injectable drugs for treatment of osteoporosis.--
(A) Clarification of drugs covered.--The section
1861(jj) (42 U.S.C. 1395x(jj)) inserted by section
4156(a)(2) of OBRA-1990 is amended--
(i) in the matter preceding paragraph (1),
by striking ``a bone fracture related to''; and
(ii) in paragraph (1), by striking
``patient'' and inserting ``individual has
suffered a bone fracture related to post-
menopausal osteoporosis and that the
individual''.
(B) Limiting coverage to drugs provided by home
health agencies.--(i) The section 1861(jj) (42 U.S.C.
1395x(jj)) inserted by section 4156(a)(2) of OBRA-1990
is amended by striking ``if'' and inserting ``by a home
health agency if''.
(ii) Section 1861(m)(5) (42 U.S.C. 1395x(m)(5)) is
amended by striking ``but excluding'' and inserting
``and a covered osteoporosis drug (as defined in
subsection (kk), but excluding other''.
(iii) Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is
amended--
(I) by adding ``and'' at the end of
subparagraph (N), and
(II) by striking subparagraph (O) and
redesignating subparagraph (P) as subparagraph
(O).
(C) Payment based on reasonable cost.--Section
1833(a)(2) (42 U.S.C. 1395l(a)(2)) is amended--
(i) in subparagraph (A), by striking
``health services'' and inserting ``health
services (other than covered osteoporosis drug
(as defined in section 1861(kk)))'';
(ii) by striking ``and'' at the end of
subparagraph (D);
(iii) by striking the semicolon at the end
and inserting ``; and''; and
(iv) by adding at the end the following new
subparagraph:
``(F) with respect to covered osteoporosis drug (as
defined in section 1861(kk)) furnished by a home health
agency, 80 percent of the reasonable cost of such
service, as determined under section 1861(v);''.
(D) Application of part b deductible.--Section
1833(b)(2) (42 U.S.C. 1395l(b)(2)) is amended by
striking ``services'' and inserting ``services (other
than covered osteoporosis drug (as defined in section
1861(kk)))''.
(E) Covered osteoporosis drug (section 4156 of
obra-1990).--Section 1861 (42 U.S.C. 1395x) is amended,
in the subsection (jj) inserted by section 4156(a)(2)
of OBRA-1990, by striking ``(jj) The term'' and
inserting ``(kk) The term''.
(9) Other miscellaneous and technical corrections (section
4164 of obra-1990).--
(A) Ownership disclosure requirements.--(i) Section
1124A(a)(2)(A) (42 U.S.C. 1320a-3a(a)(2)(A)) is amended
by striking ``of the Social Security Act''.
(ii) Section 4164(b)(4) of OBRA-1990 is amended by
striking ``paragraph'' and inserting ``paragraphs''.
(B) Directory of unique physician identifier
numbers.--Section 4164(c) of OBRA-1990 is amended by
striking ``publish'' and inserting ``publish, and shall
periodically update,''.
(g) Effective Date.--Except as otherwise provided in this section,
the amendments made by this section shall take effect as if included in
the enactment of OBRA-1990.
Subchapter F--Part B Premium
SEC. 13481. PART B PREMIUM.
Section 1839(e) (42 U.S.C. 1395r(e)) is amended--
(1) in paragraph (1)(A), by inserting ``and for each month
in 1996 and 1997'' after ``January 1991'', and
(2) in paragraph (2), by striking ``1991'' and inserting
``1998''.
CHAPTER 3--PROVISIONS RELATING TO PARTS A AND B
Subchapter A--Elimination of Updates
SEC. 13501. ELIMINATION OF COST-OF-LIVING UPDATE IN PER RESIDENT
AMOUNTS FOR DIRECT MEDICAL EDUCATION.
Section 1886(h)(2)(D) (42 U.S.C. 1395ww(h)(2)(D)) is amended by
inserting ``(other than in the case of cost reporting periods beginning
during fiscal year 1994 or fiscal year 1995)'' after ``updated''.
SEC. 13502. ELIMINATION OF INFLATION UPDATE IN COST LIMITS FOR HOME
HEALTH SERVICES.
The Secretary of Health and Human Services shall not provide for
any increase, on the basis of inflation or changes in the cost of goods
and services, in the per visit cost limits for home health services
under section 1861(v)(1)(L) of the Social Security Act for cost
reporting periods beginning during fiscal year 1994 or fiscal year
1995.
Subchapter B--Medicare Secondary Payer Provisions
SEC. 13511. EXTENSION OF TRANSFER OF DATA.
(a) Extension of Data Match Program.--
(1) Section 1862(b)(5)(C)(iii) of the Social Security Act
(42 U.S.C. 1395y(b)(5)(C)(iii)) is amended by striking ``1995''
and inserting ``1998''.
(2) Section 6103(l)(12)(F) of the Internal Revenue Code of
1986 is amended--
(A) in clause (i), by striking ``1995'' and
inserting ``1998'',
(B) in clause (ii)(I), by striking ``1994'' and
inserting ``1997'', and
(C) in clause (ii)(II), by striking ``1995'' and
inserting ``1998''.
(b) Secondary Payer Exemption for Members of Religious Orders.--
Effective as if included in the enactment of OBRA-1989, section
6202(e)(2) of such Act is amended by adding at the end the following:
``Such amendment also shall apply to items and services furnished
before such date with respect to secondary payer cases which the
Secretary of Health and Human Services had not identified as of such
date.''.
(c) Permitting the Use of Minimum Income Thresholds.--
(1) Section 6103(l)(12)(B)(i) of the Internal Revenue Code
of 1986 is amended by inserting ``, above an amount (if any)
specified by the Secretary of Health and Human Services,''
after ``section 3401(a))''.
(2) The matter in section 6103(l)(12)(B)(ii) of such Code
preceding subclause (I) is amended by inserting ``, above an
amount (if any) specified by the Secretary of Health and Human
Services,'' after ``wages''.
(3) The heading to section 6103(l)(12) of such Code is
amended by striking ``taxpayer identity'' and inserting
``return''.
SEC. 13512. 3-YEAR EXTENSION OF MEDICARE SECONDARY PAYER TO DISABLED
BENEFICIARIES.
Section 1862(b)(1)(B)(iii) (42 U.S.C. 1395y(b)(1)(B)(iii)) is
amended by striking ``1995'' and inserting ``1998''.
SEC. 13513. 3-YEAR EXTENSION OF 18-MONTH RULE FOR ESRD BENEFICIARIES.
Section 1862(b)(1)(C) (42 U.S.C. 1395y(b)(1)(C)) is amended by
striking ``1996'' and inserting ``1999''.
SEC. 13514. MEDICARE SECONDARY PAYER REFORMS.
(a) Improving Identification of Medicare Secondary Payer
Situations.--
(1) Survey of beneficiaries.--
(A) In general.--Section 1862(b)(5) (42 U.S.C.
1395y(b)(5)) is amended by adding at the end the
following new subparagraph:
``(D) Obtaining information from beneficiaries.--
Before an individual applies for benefits under part A
or enrolls under part B, the Administrator shall mail
the individual a questionnaire to obtain information on
whether the individual is covered under a primary plan
and the nature of the coverage provided under the plan,
including the name, address, and identifying number of
the plan.''.
(B) Distribution of questionnaire by contractor.--
The Secretary of Health and Human Services shall enter
into an agreement with an entity not later than
November 1, 1993, to distribute the questionnaire
described in section 1862(b)(5)(D) of the Social
Security Act (as added by subparagraph (A)).
(C) No medicare secondary payer denial based on
failure to complete questionnaire.--Section 1862(b)(2)
(42 U.S.C. 1395y(b)(2)) is amended by adding at the end
the following new subparagraph:
``(C) Treatment of questionnaires.--The Secretary
may not fail to make payment under subparagraph (A)
solely on the ground that an individual failed to
complete a questionnaire concerning the existence of a
primary plan.''.
(2) Mandatory screening by providers and suppliers under
part b.--
(A) In general.--Section 1862(b) (42 U.S.C.
1395y(b)) is amended by adding at the end the following
new paragraph:
``(6) Screening requirements for providers and suppliers.--
``(A) In general.--Notwithstanding any other
provision of this title, no payment may be made for any
item or service furnished under part B unless the
entity furnishing such item or service completes (to
the best of its knowledge and on the basis of
information obtained from the individual to whom the
item or service is furnished) the portion of the claim
form relating to the availability of other health
benefit plans.
``(B) Penalties.--An entity that knowingly,
willfully, and repeatedly fails to complete a claim
form in accordance with subparagraph (A) or provides
inaccurate information relating to the availability of
other health benefit plans on a claim form under such
subparagraph shall be subject to a civil money penalty
of not to exceed $2,000 for each such incident. The
provisions of section 1128A (other than subsections (a)
and (b)) shall apply to a civil money penalty under the
previous sentence in the same manner as such provisions
apply to a penalty or proceeding under section
1128A(a).''.
(B) Effective date.--The amendment made by
subparagraph (A) shall apply with respect to items and
services furnished on or after January 1, 1994.
(b) Improvements in Recovery of Payments From Primary Payers.--
(1) Submission of reports on efforts to recover erroneous
payments.--
(A) Fiscal intermediaries under part a.--Section
1816 (42 U.S.C. 1396h) is amended by adding at the end
the following new subsection:
``(k) An agreement with an agency or organization under this
section shall require that such agency or organization submit an annual
report to the Secretary describing the steps taken to recover payments
made for items or services for which payment has been or could be made
under a primary plan (as defined in section 1862(b)(2)(A)).''.
(B) Carriers under part b.--Section 1842(b)(3) (42
U.S.C. 1395u(b)(3)) is amended--
(i) by striking ``and'' at the end of
subparagraph (H); and
(ii) by inserting after subparagraph (H)
the following new subparagraph:
``(I) will submit annual reports to the Secretary
describing the steps taken to recover payments made under this
part for items or services for which payment has been or could
be made under a primary plan (as defined in section
1862(b)(2)(A)).''.
(2) Requirements under carrier performance evaluation
program.--
(A) Fiscal intermediaries under part a.--Section
1816(f)(1)(A) (42 U.S.C. 1396h(f)(1)(A)) is amended by
striking ``processing'' and inserting ``processing
(including the agency's or organization's success in
recovering payments made under this title for services
for which payment has been or could be made under a
primary plan (as defined in section 1862(b)(2)(A)))''.
(B) Carriers under part b.--Section 1842(b)(2) (42
U.S.C. 1395u(b)(2)) is amended by adding at the end the
following new subparagraph:
``(D) In addition to any other standards and criteria established
by the Secretary for evaluating carrier performance under this
paragraph relating to avoiding erroneous payments, the Secretary shall
establish standards and criteria relating to the carrier's success in
recovering payments made under this part for items or services for
which payment has been or could be made under a primary plan (as
defined in section 1862(b)(2)(A)).''.
(3) Deadline for reimbursement by primary plans.--
(A) In general.--Section 1862(b)(2)(B)(i) (42
U.S.C. 1395y(b)(2)(B)(i)) is amended by adding at the
end the following sentence: ``If reimbursement is not
made to the appropriate Trust Fund before the
expiration of the 60-day period that begins on the date
such notice or other information is received, the
Secretary may charge interest (beginning with the date
on which the notice or other information is received)
on the amount of the reimbursement until reimbursement
is made (at a rate determined by the Secretary in
accordance with regulations of the Secretary of the
Treasury applicable to charges for late payments).''.
(B) Conforming amendment.--The heading of clause
(i) of section 1862(b)(2)(B) is amended to read as
follows: ``Repayment required.--''.
(C) Effective date.--The amendments made by this
paragraph shall apply to payments for items and
services furnished on or after the date of the
enactment of this Act.
(4) Effective date.--The amendments made by paragraphs (1)
and (2) shall apply to contracts with fiscal intermediaries and
carriers under title XVIII of the Social Security Act for years
beginning with 1994.
(c) Application of Aggregation Rules.--
(1) Working aged.--Section 1862(b)(1)(A) (42 U.S.C.
1395y(b)(1)(A)) is amended by adding at the end the following
new clause:
``(vi) Application of aggregation rules.--
All employers treated as a single employer
under subsection (a) or (b) of section 52 of
the Internal Revenue Code of 1986 shall be
treated as a single employer for purposes of
this subparagraph.''.
(2) Disabled individuals.--Section 5000(b)(2) of the
Internal Revenue Code of 1986 (relating to large group health
plans) is amended by adding at the end the following: ``All
employers treated as a single employer under subsection (a) or
(b) of section 52 shall be treated as a single employer for
purposes of this paragraph.''.
(3) Effective date.--The amendments made by this subsection
shall take effect 90 days after the date of the enactment of
this Act.
(d) Application of Excise Tax to Failure to Reimburse Federal
Government.--
(1) In general.--Section 5000(c) of the Internal Revenue
Code of 1986 (relating to nonconforming group health plans) is
amended by striking ``of section 1862(b)(1)'' and inserting
``of paragraph (1), or with the requirements of paragraph (2),
of section 1862(b)''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to demands for repayment issued after the date of
the enactment of this Act.
(e) Miscellaneous and Technical Corrections.--
(1) The sentence in section 1862(b)(1)(C) added by section
4203(c)(1)(B) of OBRA-1990 is amended--
(A) by striking ``on or before'' and inserting
``before'', and
(B) by striking ``clauses (i) and (ii)'' and
inserting ``this subparagraph''.
(2) Effective as if included in the enactment of OBRA-1989,
section 1862(b)(1) is amended--
(A) in subparagraphs (A)(v) and (B)(iv)(II), by
inserting ``, without regard to section 5000(d) of such
Code'' before the period at the end of each
subparagraph;
(B) in subparagraph (A)(iii), by striking ``current
calendar year or the preceding calendar year'' and
inserting ``current calendar year and the preceding
calendar year''; and
(C) in the matter in subparagraph (C) after clause
(ii), by striking ``taking into account that'' and
inserting ``paying benefits secondary to this title
when''.
(3) Effective as if included in the enactment of OBRA-1989,
section 1862(b)(5)(C)(i) (42 U.S.C. 1395y(b)(5)(C)(i)) is
amended by striking ``6103(l)(12)(D)(iii)'' and inserting
``6103(l)(12)(E)(iii)''.
(4) Section 4203(c)(2) of OBRA-1990 is amended--
(A) by striking ``the application of clause (iii)''
and inserting ``the second sentence'';
(B) by striking ``on individuals'' and all that
follows through ``section 226A of such Act'';
(C) in clause (ii), by striking ``clause'' and
inserting ``sentence'';
(D) in clause (v), by adding ``and'' at the end;
and
(E) in clause (vi)--
(i) by inserting ``of such Act'' after
``1862(b)(1)(C)'', and
(ii) by striking the period at the end and
inserting the following: ``, without regard to
the number of employees covered by such
plans.''.
(5) Section 4203(d) of OBRA-1990 is amended by striking
``this subsection'' and inserting ``this section''.
(6) Except as provided in paragraphs (2) and (3), the
amendments made by this subsection shall be effective as if
included in the enactment of OBRA-1990.
Subchapter C--Physician Ownership and Referral
SEC. 13521. APPLICATION OF MEDICARE BAN ON SELF-REFERRALS TO ALL
PAYERS.
(a) In General.--Section 1877 (42 U.S.C. 1395nn) is amended--
(1) in subsection (a)--
(A) in paragraph (1)(A), by striking ``for which
payment otherwise may be made under this title'' and
inserting ``for which a charge is imposed'', and
(B) in paragraph (1)(B), by striking ``under this
title'';
(2) by amending paragraph (1) of subsection (g) to read as
follows:
``(1) Denial of payment.--No payment may be made under this
title, under another Federal health care program, or under a
State health care program (as defined in section 1128(h)) for a
designated health service for which a claim is presented in
violation of subsection (a)(1)(B). No individual, third party
payer, or other entity is liable for payment for designated
health services for which a claim is presented in violation of
such subsection.''; and
(3) in subsection (g)(3), by striking ``for which payment
may not be made under paragraph (1)'' and inserting ``for which
such a claim may not be presented under subsection (a)(1)''.
(b) Conforming Amendment to Reporting Requirement.--Section 1877(f)
(42 U.S.C. 1395nn(f)) is amended--
(1) by striking ``for which payment may be made under this
title'' each place it appears and inserting ``for which a
charge is imposed'', and
(2) by striking the third sentence.
SEC. 13522. EXTENSION OF SELF-REFERRAL BAN TO ADDITIONAL SPECIFIED
SERVICES.
Section 1877 (42 U.S.C. 1395nn) is amended--
(1) by striking ``clinical laboratory service'', ``clinical
laboratory services'', and ``clinical laboratory services'' and
inserting ``designated health service'', ``designated health
services'', and ``designated health services'', respectively,
each place each appears in subsections (a)(1), (b)(2)(A)(ii),
(b)(4), (d)(1), (d)(2), (d)(3), (f), (g)(1), and (h)(7)(B); and
(2) by adding at the end the following new subsection:
``(i) Designated Health Services Defined.--In this section, the
term `designated health services' means any of the following items or
services:
``(1) clinical laboratory services;
``(2) physical and occupational therapy services;
``(3) radiology services, including magnetic resonance
imaging, computerized axial tomography scans, and ultrasound
services;
``(4) radiation therapy services;
``(5) durable medical equipment;
``(6) parenteral and enteral nutrition equipment and
supplies;
``(7) prosthetic devices and orthotics and prosthetics;
``(8) outpatient prescription drugs;
``(9) home infusion therapy services, home dialysis, and
home health services;
``(10) ambulance services;
``(11) inpatient and outpatient hospital services;
``(12) comprehensive outpatient rehabilitation facility
services;
``(13) contact lenses and eyeglasses; and
``(14) hearing aids.''.
SEC. 13523. EXCEPTIONS FOR BOTH OWNERSHIP AND COMPENSATION
ARRANGEMENTS.
(a) Modification to Exception for In-Office Ancillary Services.--
Section 1877(b)(2) (42 U.S.C. 1395nn(b)(2)) is amended--
(1) by inserting ``(other than durable medical equipment,
parenteral and enteral nutrition equipment and supplies, and
ambulance services)'' after ``services'' the first place it
appears, and
(2) in subparagraph (A)(ii)(II), by striking ``centralized
provision'' and inserting ``provision of some or all''.
(b) Modification of Rural Provider Exception.--
(1) In general.--Section 1877(b) (42 U.S.C. 1395nn(b)) is
amended--
(A) by redesignating paragraph (5) as paragraph
(6), and
(B) by inserting after paragraph (4) the following
new paragraph:
``(5) Rural providers.--In the case of designated health
services if--
``(A) the entity furnishing the services is in a
rural area (as defined in section 1886(d)(2)(D)), and
``(B) substantially all of the services (as defined
by the Secretary) furnished by the entity are furnished
to individuals who reside in such a rural area.''.
(2) Conforming amendments.--Section 1877(d) (42 U.S.C.
1395nn(d)) is amended--
(A) by striking paragraph (2), and
(B) by redesignating paragraph (3) as paragraph
(2).
SEC. 13524. EXCEPTIONS RELATED ONLY TO OWNERSHIP OR INVESTMENT.
(a) Publicly-Traded Securities.--Section 1877(c)(2) (42 U.S.C.
1395nn(c)(2)) is amended by striking ``total assets'' and inserting
``stockholder equity''.
(b) Rural Providers.--For amendment to exception relation to rural
providers, see section 13523(b).
SEC. 13525. EXCEPTIONS RELATED ONLY TO COMPENSATION ARRANGEMENTS.
(a) Rental of Office Space and Equipment.--
(1) In general.--Paragraph (1) of section 1877(e) (42
U.S.C. 1395nn(e)) is amended to read as follows:
``(1) Rental of office space; rental of equipment.--
``(A) Office space.--Payments made by a lessee to a
lessor for the use of premises if--
``(i) the lease is set out in writing,
signed by the parties, and specifies the
premises covered by the lease,
``(ii) the aggregate space rented or leased
does not exceed that which is reasonable and
necessary for the legitimate business purposes
of the lease or rental and is used exclusively
by the lessee when being used by the lessee,
``(iii) the lease provides for a term of
rental or lease for at least one year,
``(iv) the aggregate rental charges over
the term of the lease are set in advance, are
consistent with fair market value, and are not
determined in a manner that takes into account
the volume or value of any referrals or other
business generated between the parties,
``(v) the lease would be commercially
reasonable even if no referrals were made
between the parties,
``(vi) the lease covers all of the premises
leased between the parties for the period of
the lease, and
``(vii) the compensation arrangement meets
such other requirements as the Secretary may
impose by regulation as needed to protect
against program or patient abuse.
``(B) Equipment.--Payments made by a lessee of
equipment to the lessor of the equipment for the use of
the equipment if--
``(i) the lease is set out in writing,
signed by the parties, and specifies the
equipment covered by the lease,
``(ii) the equipment rented or leased does
not exceed that which is reasonable and
necessary for the legitimate business purposes
of the lease or rental and is used exclusively
by the lessee when being used by the lessee,
``(iii) the lease provides for a term of
rental or lease of at least one year,
``(iv) the aggregate rental charges over
the term of the lease are set in advance, are
consistent with fair market value, and are not
determined in a manner that takes into account
the volume or value of any referrals or other
business generated between the parties,
``(v) the lease would be commercially
reasonable even if no referrals were made
between the parties,
``(vi) the lease covers all of the
equipment leased between the parties for the
period of the lease, and
``(vii) the compensation arrangement meets
such other requirements as the Secretary may
impose by regulation as needed to protect
against program or patient abuse.''.
(2) Conforming amendment.--Section 1877(h) (42 U.S.C.
1395nn(h)) is amended by striking paragraphs (5) and (6).
(b) Bona Fide Employment Relationships.--Section 1877(e) (42 U.S.C.
1395nn(e)) is amended--
(1) in paragraph (2)--
(A) by striking ``Employment'' and all that follows
through ``if'' and inserting ``Bona fide employment
relationships.--Any amount paid by an employer to a
physician (or immediate family member) who has a bona
fide employment relationship with the employer for the
provision of services if'';
(B) in subparagraphs (A), (B), and (D), by striking
``arrangement'' and inserting ``employment'';
(C) in subparagraph (C), by striking ``to the
hospital''; and
(D) by adding at the end the following:
``Subparagraph (B)(ii) shall not be construed as prohibiting
the payment of remuneration in the form of shares of overall
profits or in the form of a productivity bonus based on
services performed personally by the physician or family
member, if the amount of the remuneration is not determined in
a manner that takes into account directly the volume or value
of any referrals by the referring physician.''; and
(2) in paragraph (5)(A), by striking ``in the same manner
as they apply to a hospital''.
(c) Personal Service Arrangements.--
(1) In general.--Paragraph (3) of section 1877(e) (42
U.S.C. 1395nn(e)) is amended to read as follows:
``(3) Personal service arrangements.--Remuneration from an
entity under an arrangement if--
``(A) the arrangement is set out in writing, signed
by the parties, and specifies the services covered by
the arrangement,
``(B) the arrangement covers all of the services to
be provided by the physician (or family member) to the
entity,
``(C) the aggregate services contracted for do not
exceed those that are reasonable and necessary for the
legitimate business purposes of the arrangement,
``(D) the term of the arrangement is for at least
one year,
``(E) the compensation to be paid over the term of
the arrangement is set in advance, does not exceed fair
market value, and is not determined in a manner that
takes into account directly or indirectly the volume or
value of any referrals or other business generated
between the parties,
``(F) the services to be performed under the
arrangement do not involve the counseling or promotion
of a business arrangement or other activity that
violates any State or Federal law, and
``(G) the arrangement meets such other requirements
as the Secretary may impose by regulation as needed to
protect against program or patient abuse.''.
(2) Health services furnished under certain hospital
arrangements.--Section 1877(e) (42 U.S.C. 1395nn(e)) is amended
by adding at the end the following new paragraph:
``(7) Certain group practice arrangements with a
hospital.--
``(A) In general.--An arrangement between a
hospital and a group for the provision of designated
health services by the group but billed in the name of
the hospital if--
``(i) the group would be a group practice,
but for the fact that it bills for such
services in the name of the hospital;
``(ii) with respect to services provided to an
inpatient of the hospital, the arrangement is pursuant
to the provision of inpatient hospital services under
section 1861(b)(3);
``(iii) the arrangement began before December 19,
1989, and has continued in effect without interruption
since such date;
``(iv) the group provides substantially all of the
designated health services furnished under the
arrangement to the hospital's patients;
``(v) the arrangement is pursuant to an agreement
that is set out in writing and that specifies the
services to be provided by the parties and the
compensation for services provided under the agreement;
``(vi) the compensation paid over the term of the
agreement is consistent with fair market value and the
compensation per unit of services is fixed in advance
and is not determined in a manner that takes into
account the volume or value of any referrals or other
business generated between the parties;
``(vii) the compensation is provided pursuant to an
agreement which would be commercially reasonable even
if no referrals were made to the entity; and
``(viii) the arrangement between the parties meets
such other requirements as the Secretary may impose by
regulation as needed to protect against program or
patient abuse.''.
(d) Physician Recruitment.--Section 1877(e)(4) (42 U.S.C.
1395nn(e)(4)) is amended--
(1) by redesignating subparagraphs (A) through (C) as
subparagraph (B) through (D), and
(2) by inserting before subparagraph (B), as so
redesignated, the following new subparagraph:
``(A) the remuneration arrangement is set out in
writing, signed by the parties, and specifies the
benefits provided by the hospital, the terms under
which the benefits are to be provided, and the
obligations of the parties,''.
(e) Isolated Transactions.--Section 1877(e)(5) (42 U.S.C.
1395nn(e)(5)) is amended--
(1) by striking ``Isolated'' and inserting ``One-time'',
(2) by striking ``isolated'' and inserting ``one-time'',
and
(3) by inserting ``or practice'' after ``one-time sale of
property''.
(f) New Exception for Payments by Physician.--Section 1877(e) (42
U.S.C. 1395nn(e)), as amended by subsection (c)(2), is further amended
by adding at the end the following new paragraph:
``(8) Payments by a physician for items and services.--
Payments made by a physician--
``(A) to a laboratory in exchange for the provision
of clinical laboratory services, or
``(B) to an entity as compensation for other items
or services if the items or services are furnished at a
price that is consistent with fair market value.''.
SEC. 13526. CLARIFICATION CONCERNING CIVIL MONEY PENALTY SANCTIONS.
Section 1877(g)(3) (42 U.S.C. 1395nn(g)(3)) is amended by inserting
``(including a referring physician)'' after ``Any person''.
SEC. 13527. REQUIREMENTS FOR GROUP PRACTICE.
(a) Additional Requirements.--Section 1877(h)(4) (42 U.S.C.
1395nn(h)(4)) is amended--
(1) by striking ``and'' at the end of subparagraph (C);
(2) by redesignating subparagraphs (A), (B), (C), and (D)
as clauses (i), (ii), (iii), and (vii), respectively;
(3) by inserting ``(A)'' after ``.--'';
(4) by inserting after clause (iii), as so redesignated,
the following:
``(iv) subject to subparagraph (B), no physician
who is a member of the group receives compensation
based on the volume or value of referrals by the
physician;
``(v) there are no less than, on average, 5
physicians for each office location (as defined in
subparagraph (C)), except where there is only a single
office location for the entire group practice;
``(vi) members of the group personally conduct no
less than 75 percent of the physician-patient
encounters of the group practice; and''; and
(5) by adding at the end the following new subparagraphs:
``(B) A physician in a group practice may be paid a share
of overall profits of the group or a productivity bonus (based
on services personally performed or personally supervised by
the physician or by another physician in the group) so long as
the share or bonus is not determined in any manner which is
directly related to the volume or value of referrals by that
physician.
``(C)(i) Except as provided in clauses (ii) through (iv),
the term `office location' means an office where physician
services are offered to patients.
``(ii) Such term does not include a location consisting
solely of a diagnostic facility, nursing facility, or treatment
facility (such as a physical or occupational therapy center),
or administrative services affiliated with the group practice.
``(iii) Any office location which is located immediately
adjacent to another office location shall be treated as the
same office location.
``(iv) The term `office location' does not include an
office located in a rural area (as defined in section
1886(d)(2)(D)) if at least 85 percent of the physician services
at the location are provided to individuals who reside in such
a rural area.''.
(b) Use of Billing Numbers, Etc.--Section 1877 (42 U.S.C. 1395nn)
is amended--
(1) in subsection (b)(2)(B), by inserting ``under a billing
number assigned to the group practice'' after ``member'',
(2) in subsection (h)(4)(A)(ii), as redesignated by
subsection (a)(2), by inserting ``and under a billing number
assigned to the group'' after ``in the name of the group'', and
(3) in subsection (h)(4)(A)(iii), as redesignated by
subsection (a)(2), by striking ``by members of the group''.
(c) Treatment of Certain Faculty Practice Plans.--The last sentence
of section 1877(h)(4)(A) (42 U.S.C. 1395nn(h)(4)(A)), as redesignated
by subsection (a)(2), is amended by inserting ``, institution of higher
education, or medical school'' after ``hospital''.
SEC. 13538. NO FEDERAL PREEMPTION OF MORE RESTRICTIVE STATE LAWS.
Section 1877 (42 U.S.C. 1395nn), as amended by section 13522(2), is
amended by adding at the end the following new subsection:
``(j) No Federal Preemption of More Restrictive State Laws.--
Nothing in this section shall preempt provisions of State law--
``(1) that relate to referrals not covered by this section,
or
``(2) that relate to referrals covered by this section and
are more restrictive with respect to such referrals than the
provisions of this section.''.
SEC. 13529. MISCELLANEOUS PROVISIONS.
(a) Indirect Financial Relationships.--The last sentence of section
1877(a)(2) (42 U.S.C. 1395nn(a)(2)) is amended by inserting before the
period the following: ``and includes an interest in an entity that
holds an ownership or investment in another entity''.
(b) Minor Remuneration.--Section 1877(h)(1) (42 U.S.C.
1395nn(h)(1)) is amended--
(1) in subparagraph (A), by inserting before the period at
the end the following: ``(other than an arrangement involving
only remuneration described in subparagraph (C))'', and
(2) by adding at the end the following new subparagraph:
``(C) Remuneration described in this subparagraph is any
remuneration consisting of any of the following:
``(i) The forgiveness of amounts owed for
inaccurate tests or procedures, mistakenly performed
tests or procedures, or the correction of minor billing
errors.
``(ii) The provision of items, devices, or supplies
that are used solely to--
``(I) collect, transport, process, or store
specimens for the entity providing the item,
device, or supply, or
``(II) communicate the results of tests or
procedures for such entity.''.
(c) Referring Physician.--Section 1877(h)(7)(C) (42 U.S.C.
1395nn(h)(7)(C)) is amended--
(1) by inserting ``a request by a radiologist for
diagnostic radiology services, and a request by a radiation
oncologist for radiation therapy,'' after ``examination
services,'', and
(2) by inserting ``, radiologist, or radiation oncologist''
after ``pathologist'' the second place it appears.
(d) Miscellaneous and Technical Corrections.--Section 1877 (42
U.S.C. 1395nn) is further amended--
(1) in the next to last sentence of subsection (f)--
(A) by striking ``provided'' and inserting
``furnished'', and
(B) by striking ``provides'' and inserting
``furnish'';
(2) in the last sentence of subsection (f)--
(A) by striking ``providing'' each place it appears
and inserting ``furnishing'',
(B) by striking ``with respect to the providers''
and inserting ``with respect to the entities'', and
(C) by striking ``diagnostic imaging services of
any type'' and inserting ``magnetic resonance imaging,
computerized axial tomography scans, and ultrasound
services''; and
(3) in subsection (a)(2)(B), by striking ``subsection
(h)(1)(A)'' and inserting ``subsection (h)(1)''.
SEC. 13530. EFFECTIVE DATES.
(a) Expansion of Payers and Services.--The amendments made by
sections 13521 and 13522 shall apply with respect to a referral by a
physician made on or after December 31, 1994.
(b) Other Provisions.--
(1) In general.--Except as provided in this subsection, the
amendments made by sections 13523 through 13529 shall apply to
referrals made on or after January 1, 1992.
(2) Delay in effectiveness for more restrictive
provisions.--The amendments made by the following sections
shall apply with respect to a referral by a physician made on
or after December 31, 1994:
(A) Section 13523(b) (relating to the rural
provider exception).
(B) Section 13524(a) (relating to publicly-traded
securities).
(C)(i) Section 13525(a) (relating to an exception
for office rental and equipment), other than the
exception relating to equipment.
(ii) Section 13525(c)(1) (relating to exception for
personal services arrangements).
(iii) Section 13525(d) (relating to physician
recruitment).
(D) Section 13526 (relating to civil money
penalty).
(E) Section 13527 (relating to requirements for
group practices), other than subsection (c) (relating
to faculty plans).
(F) Section 13528 (relating to non-preemption).
(G) Section 13529(a) (relating to indirect
financial relationships).
Subchapter D--Other Provisions
SEC. 13551. DIRECT GRADUATE MEDICAL EDUCATION.
(a) Adjustment in GME Base-year Costs of Federal Insurance
Contributions Act.--
(1) In general.--In determining the amount of payment to be
made under section 1886(h) of the Social Security Act in the
case of a hospital described in paragraph (2) for cost
reporting periods beginning on or after October 1, 1992, the
Secretary of Health and Human Services shall redetermine the
approved FTE resident amount to reflect the amount that would
have been paid the hospital if, during the hospital's base cost
reporting period, the hospital had been liable for FICA taxes
or for contributions to the retirement system of a State, a
political subdivision of a State, or an instrumentality of such
a State or political subdivision with respect to interns and
residents in its medical residency training program.
(2) Hospitals affected.--A hospital described in this
paragraph is a hospital that did not pay FICA taxes with
respect to interns and residents in its medical residency
training program during the hospital's base cost reporting
period, but is required to pay FICA taxes or make contributions
to a retirement system described in paragraph (1) with respect
to such interns and residents because of the amendments made by
section 11332(b) of OBRA-1990.
(3) Definitions.--In this subsection:
(A) The ``base cost reporting period'' for a
hospital is the hospital's cost reporting period that
began during fiscal year 1984.
(B) The term ``FICA taxes'' means, with respect to
a hospital, the taxes under section 3111 of the
Internal Revenue Code of 1986.
(b) Publicly-Funded Family Practice Residency Programs.--
(1) In general.--Section 1886(h)(5) (42 U.S.C.
1395ww(h)(5)) is amended by adding at the end the following new
subparagraph:
``(I) Adjustments for certain family practice
residency programs.--
``(i) In general.--In the case of an
approved medical residency training program
(meeting the requirements of clause (ii)) of a
hospital which received payments from the
United States, a State, or a political
subdivision of a State or an instrumentality of
such a State or political subdivision (other
than payments under this title or a State plan
under title XIX) for the program during the
cost reporting period that began during fiscal
year 1984, the Secretary shall--
``(I) provide for an average amount
under paragraph (2)(A) that takes into
account the Secretary's estimate of the
amount that would have been recognized
as reasonable under this title if the
hospital had not received such
payments, and
``(II) reduce the payment amount
otherwise provided under this
subsection in an amount equal to the
proportion of such program payments
during the cost reporting period
involved that is allocable to this
title.
``(ii) Additional requirements.--A
hospital's approved medical residency program
meets the requirements of this clause if--
``(I) the program is limited to
training for family and community
medicine;
``(II) the program is the only
approved medical residency program of
the hospital; and
``(III) the average amount
determined under paragraph (2)(A) for
the hospital (as determined without
regard to the increase in such amount
described in clause (i)(I)) does not
exceed $10,000.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to payments under section 1886(h) of the Social
Security Act for cost reporting periods beginning on or after
October 1, 1990.
(c) Preventive Care Residencies.--
(1) Eligibility of preventive care residency programs for
expanded initial residency periods.--Section 1886(h)(5)(F)(ii)
(42 U.S.C. 1395ww(h)(5)(F)(ii)) is amended by inserting after
``fellowship program'' the following: ``or a preventive care
residency or fellowship program''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to cost reporting periods beginning on or after
October 1, 1993.
SEC. 13552. IMMUNOSUPPRESSIVE DRUG THERAPY.
Section 1861(s)(2)(J) (42 U.S.C. 1395x(s)(2)(J)) is amended by
striking ``title, within'' and all that follows and inserting the
following: ``title, but only in the case of drugs furnished--
``(i) before 1994, within 12 months after the date
of the transplant procedure,
``(ii) during 1994, within 18 months after the date
of the transplant procedure,
``(iii) during 1995, within 24 months after the
date of the transplant procedure,
``(iv) during 1996, within 30 months after the date
of the transplant procedure, and
``(v) during any year after 1997, within 36 months
after the date of the transplant procedure;''.
SEC. 13553. REDUCTION IN PAYMENTS FOR ERYTHROPOIENTIN.
(a) In General.--Section 1881(b)(11)(B)(ii)(I) (42 U.S.C.
1395rr(b)(11)(B)(ii)(I)) is amended--
(1) by striking ``1991'' and inserting ``1994''; and
(2) by striking ``$11'' and inserting ``$10''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to erythropoietin furnished on or after January 1, 1994.
SEC. 13554. QUALIFIED MEDICARE BENEFICIARY OUTREACH.
The Secretary of Health and Human Services shall establish and
implement a method for obtaining information from newly eligible
medicare beneficiaries that may be used to determine whether such
beneficiaries may be eligible for medical assistance for medicare cost-
sharing under State medicaid plans as qualified medicare beneficiaries,
and for transmitting such information to the State in which such a
beneficiary resides.
SEC. 13555. EXTENSION OF SOCIAL HEALTH MAINTENANCE ORGANIZATION
DEMONSTRATIONS.
(a) Extension of Current Waivers.--Section 4018(b) of OBRA-1987, as
amended by section 4207(b)(4)(B) of OBRA-1990, is amended--
(1) in paragraph (1) by striking ``December 31, 1995'' and
inserting ``December 31, 1997''; and
(2) in paragraph (4) by striking ``March 31, 1996'' and
inserting ``March 31, 1998''.
(b) Expansion of Demonstrations.--Section 2355 of the Deficit
Reduction Act of 1984 is amended--
(1) in the last sentence of subsection (a) by striking ``12
months'' and inserting ``36 months''; and
(2) in subsection (b)(1)(B)--
(A) by striking ``or'' at the end of clause (iii);
and
(B) by redesignating clause (iv) as clause (v) and
inserting after clause (iii) the following new clause:
``(iv) integrating acute and chronic care
management for patients with end-stage renal
disease through expanded community care case
management services (and for purposes of a
demonstration project conducted under this
clause, any requirement under a waiver granted
under this section that a project disenroll
individuals who develop end-stage renal disease
shall not apply); or''.
(c) Expansion of Number of Members Per Site.--The Secretary of
Health and Human Services may not impose a limit of less than 12,000 on
the number of individuals that may participate in a project conducted
under section 2355 of the Deficit Reduction Act of 1984.
(d) Miscellaneous and Technical Corrections.--
(1) The section following section 4206 of OBRA-1990 is
amended by striking ``Sec. 4027.'' and inserting ``Sec.
4207.'', and in this subtitle is referred to as section 4207 of
OBRA-1990.
(2) Section 2355(b)(1)(B) of the Deficit Reduction Act of
1984, as amended by section 4207(b)(4)(B)(ii) of OBRA-1990, is
amended--
(A) by striking ``12907(c)(4)(A)'' and inserting
``4207(b)(4)(B)(i)'', and
(B) by striking ``feasibilitly'' and inserting
``feasibility''.
(3) Section 4207(b)(4)(B)(iii)(III) of OBRA-1990 is amended
by striking the period at the end and inserting a semicolon.
(4) Subsections (c)(3) and (e) of section 2355 of the
Deficit Reduction Act of 1984, as amended by section
4207(b)(4)(B) of OBRA-1990, are each amended by striking
``12907(c)(4)(A)'' each place it appears and inserting
``4207(b)(4)(B)''.
(5) Section 4207(c)(2) of OBRA-1990 is amended by striking
``the Committee on Ways and Means'' each place it appears and
inserting ``the Committees on Ways and Means and Energy and
Commerce''.
(6) Section 4207(d) of OBRA-1990 is amended by
redesignating the second paragraph (3) (relating to effective
date) as paragraph (4).
(7) Section 4207(i)(2) of OBRA-1990 is amended--
(A) by striking the period at the end of clause
(iii) and inserting a semicolon, and
(B) in clause (v), by striking ``residents'' and
inserting ``patients''.
(8) Section 4207(j) of OBRA-1990 is amended by striking
``title'' each place it appears and inserting ``subtitle''.
(e) Effective Date.--The amendments made by this section shall take
effect as if included in the enactment of OBRA-90.
SEC. 13556. HOSPICE NOTIFICATION TO HOME HEALTH BENEFICIARIES.
(a) In General.--Section 1891(a)(1) (42 U.S.C. 1395bbb(a)(1)) is
amended by adding at the end the following new subparagraph:
``(H) The right, in the case of a resident who is
entitled to benefits under this title, to be fully
informed orally and in writing (at the time of coming
under the care of the agency) of the entitlement of
individuals to hospice care under section 1812(a)(4)
(unless there is no hospice program providing hospice
care for which payment may be made under this title
within the geographic area of the facility and it is
not the common practice of the agency to refer patients
to hospice programs located outside such geographic
area).''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to services furnished on or after the first day of the first
month beginning more than one year after the date of the enactment of
this Act.
SEC. 13557. INTEREST PAYMENTS.
(a) In General.--Sections 1816(c)(2)(B)(ii)(IV) and
1842(c)(2)(B)(ii)(IV) of the Social Security Act shall be applied with
respect to claims received in the 12-month period beginning October 1,
1992, by substituting ``30 calendar days'' for ``24 calendar days'' and
``17 calendar days''.
(b) Effective Date.--Subsection (a) shall be in effect during the
period that begins on the date of the enactment of this Act and ends on
September 30, 1993.
SEC. 13558. PEER REVIEW ORGANIZATIONS.
(a) Repeal Of PRO Precertification Requirement for Certain Surgical
Procedures.--
(1) In general.--Section 1164 (42 U.S.C. 1320c-13) is
repealed.
(2) Conforming amendments.--
(A) Section 1154 (42 U.S.C. 1320c-3) is amended--
(i) in subsection (a), by striking
paragraph (12), and
(ii) in subsection (d), by striking ``(and
except as provided in section 1164)''.
(B) Section 1833 (42 U.S.C. 1395l) is amended--
(i) in subsection (a)(1)(D)(i), by striking
``, or for tests furnished in connection with
obtaining a second opinion required under
section 1164(c)(2) (or a third opinion, if the
second opinion was in disagreement with the
first opinion)'';
(ii) in subsection (a)(1), by striking
clause (G);
(iii) in subsection (a)(2)(A), by striking
``, to items and services (other than clinical
diagnostic laboratory tests) furnished in
connection with obtaining a second opinion
required under section 1164(c)(2) (or a third
opinion, if the second opinion was in
disagreement with the first opinion),'';
(iv) in subsection (a)(2)(D)(i)--
(I) by striking ``basis,'' and
inserting ``basis or'', and
(II) by striking ``, or for tests
furnished in connection with obtaining
a second opinion required under section
1164(c)(2) (or a third opinion, if the
second opinion was in disagreement with
the first opinion)'';
(v) in subsection (a)(3), by striking ``and
for items and services furnished in connection
with obtaining a second opinion required under
section 1164(c)(2), or a third opinion, if the
second opinion was in disagreement with the
first opinion)''; and
(vi) in the first sentence of subsection
(b), by striking ``(4)'' and all that follows
through ``and (5)'' and inserting and (4)''.
(C) Section 1834(g)(1)(B) (42 U.S.C.
1395m(g)(1)(B)) is amended by striking ``and for items
and services furnished in connection with obtaining a
second opinion required under section 1164(c)(2), or a
third opinion, if the second opinion was in
disagreement with the first opinion)''.
(D) Section 1862(a) (42 U.S.C. 1395y(a)) is
amended--
(i) by adding ``or'' at the end of
paragraph (14),
(ii) by striking ``; or'' at the end of
paragraph (15) and inserting a period, and
(iii) by striking paragraph (16).
(E) The third sentence of section 1866(a)(2)(A) (42
U.S.C. 1395w(a)(2)(A)) is amended by striking ``, with
respect to items and services furnished in connection
with obtaining a second opinion required under section
1164(c)(2) (or a third opinion, if the second opinion
was in disagreement with the first opinion),''.
(3) Effective date.--The amendments made by this subsection
shall apply to services provided on or after the date of the
enactment of this Act.
(b) Miscellaneous and Technical Corrections.--(1) The third
sentence of section 1156(b)(1) (42 U.S.C. 1320c-5(b)(1)) is amended by
striking ``whehter'' and inserting ``whether''.
(2) Section 1154(a)(9)(B) (42 U.S.C. 1320c-3(a)(9)(B)) is amended
by striking ``this subsection'' and inserting ``section 1156(a)''.
(3) Section 4205(d)(2)(B) of OBRA-1990 is amended by striking
``amendments'' and inserting ``amendment''.
(4) Section 1160(d) (42 U.S.C. 1320c-9(d)) is amended by striking
``subpena'' and inserting ``subpoena''.
(5) Section 4205(e)(2) of OBRA-1990 is amended by striking
``amendments'' and inserting ``amendment'' and by striking ``all''.
(6)(A) Except as provided in subparagraph (B), the amendments made
by this subsection shall take effect as if included in the enactment of
OBRA-1990.
(B) The amendment made by paragraph (2) (relating to the
requirement on reporting of information to State licensing boards)
shall take effect on the date of the enactment of this Act.
SEC. 13559. HEALTH MAINTENANCE ORGANIZATIONS.
(a) Adjustment In Medicare Capitation Payments To Account For
Regional Variations In Application Of Secondary Payer Provisions.--
(1) In general.--Section 1876(a)(4) (42 U.S.C.
1395mm(a)(4)) is amended by adding at the end the following new
sentence: ``In establishing the adjusted average per capita
cost for a geographic area, the Secretary shall take into
account the differences between the proportion of individuals
in the area with respect to whom there is a group health plan
that is a primary plan (within the meaning of section
1862(b)(2)(A)) compared to the proportion of all such
individuals with respect to whom there is such a group health
plan.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to contracts entered into for years beginning with
1994.
(b) Revisions in the Payment Methodology for Risk Contractors.--
Section 4204(b) of OBRA-1990 is amended to read as follows:
``(b) Revisions in the Payment Methodology for Risk Contractors.--
(1)(A) Not later than October 1, 1993, the Secretary of Health and
Human Services (in this subsection referred to as the `Secretary')
shall submit a proposal to the Congress that provides for revisions to
the payment method to be applied in years beginning with 1995 for
organizations with a risk-sharing contract under section 1876(g) of the
Social Security Act.
``(B) In proposing the revisions required under subparagraph (A)
the Secretary shall consider--
``(i) the difference in costs associated with medicare
beneficiaries with differing health status and demographic
characteristics; and
``(ii) the effects of using alternative geographic
classifications on the determinations of costs associated with
beneficiaries residing in different areas.
``(2) Not later than 3 months after the date of submittal of the
proposal under paragraph (1), the Comptroller General shall review the
proposal and shall report to Congress on the appropriateness of the
proposed modifications.''.
(c) Miscellaneous and Technical Corrections.--(1) Section
1876(a)(3) (42 U.S.C. 1395mm(a)(3)) is amended by striking ``subsection
(c)(7)'' and inserting ``subsections (c)(2)(B)(ii) and (c)(7)''.
(2) Section 4204(c)(3) of OBRA-1990 is amended by striking ``for
1991'' and inserting ``for years beginning with 1991''.
(3) Section 4204(d)(2) of OBRA-1990 is amended by striking
``amendment'' and inserting ``amendments''.
(4) Section 1876(a)(1)(E)(ii)(I) (42 U.S.C. 1395mm(a)(1)(E)(ii)(I))
is amended by striking the comma after ``contributed to''.
(5) Section 4204(e)(2) of OBRA-1990 is amended by striking ``(which
has a risk-sharing contract under section 1876 of the Social Security
Act)''.
(6) Section 4204(f)(4) of OBRA-1990 is amended by striking
``final''.
(7) Section 1862(b)(3)(C) (42 U.S.C. 1395y(b)(3)(C)) is amended--
(A) in the heading, by striking ``plan'' and inserting
``plan or a large group health plan'';
(B) by striking ``group health plan'' and inserting ``group
health plan or a large group health plan'';
(C) by striking ``, unless such incentive is also offered
to all individuals who are eligible for coverage under the
plan''; and
(D) by striking ``the first sentence of subsection (a) and
other than subsection (b)'' and inserting ``subsections (a) and
(b)''.
(8) The amendments made by this subsection shall take effect as if
included in the enactment of OBRA-1990.
SEC. 13560. MEDICARE ADMINISTRATION BUDGET PROCESS.
(a) Adjustments.--Section 251(b)(2) of the Balanced Budget and
Emergency Deficit Control Act of 1985 is amended by redesignating
subparagraphs (E) and (F) as subparagraphs (F) and (G), respectively,
and by inserting after subparagraph (D) the following new subparagraph:
``(E) Medicare administrative costs.--To the extent
that appropriations are enacted that provide additional
new budget authority (as compared with a base level of
$1,526,000,000 for new budget authority) for the
administration of the Medicare program by fiscal
intermediaries and carriers pursuant to sections 1816
and 1842(a) of title XVIII of the Social Security Act,
the adjustment for that year shall be that amount, but
shall not exceed--
``(i) for fiscal year 1994, $198,000,000 in
new budget authority and $198,000,000 in
outlays; and
``(ii) for fiscal year 1995, $220,000,000
in new budget authority and $220,000,000 in
outlays; and
the prior-year outlays resulting from these appropriations of
budget authority and additional adjustments equal to the sum of
the maximum adjustments that could have been made in preceding
fiscal years under this subparagraph.''.
(b) Conforming Amendments.--
(1) Section 603(a) of the Congressional Budget Act of 1974
is amended by striking ``section 251(b)(2)(E)(i)'' and
inserting ``section 251(b)(2)(F)(i)''.
(2) Section 606(d) of the Congressional Budget Act of 1974
is amended--
(A) in paragraph (1)(A) by striking ``section
251(b)(2)(E)(i)'' and inserting ``section
251(b)(2)(F)(i)''; and
(B) in paragraph (2), by inserting
``251(b)(2)(E),'' after ``251(b)(2)(D),''.
SEC. 13561. OTHER PROVISIONS.
(a) Survey and Certification Requirements.--(1) Section 1864 (42
U.S.C. 1395aa) is amended--
(A) in subsection (e), by striking ``title'' and inserting
``title (other than any fee relating to section 353 of the
Public Health Service Act)''; and
(B) in the first sentence of subsection (a), by striking
``1861(s) or'' and all that follows through ``Service Act,''
and inserting ``1861(s),''.
(2) An agreement made by the Secretary of Health and Human Services
with a State under section 1864(a) of the Social Security Act may
include an agreement that the services of the State health agency or
other appropriate State agency (or the appropriate local agencies) will
be utilized by the Secretary for the purpose of determining whether a
laboratory meets the requirements of section 353 of the Public Health
Service Act.
(b) Home Dialysis Demonstration Technical Correction.--Section 4202
of OBRA-1990 is amended--
(1) in subsection (b)(1)(A), by striking ``home
hemodialysis staff assistant'' and inserting ``qualified home
hemodialysis staff assistant (as described in subsection
(d))'';
(2) in subsection (b)(2)(B)(ii)(I), by striking ``(as
adjusted to reflect differences in area wage levels);
(3) in subsection (c)(1)(A), by striking ``skilled''; and
(4) in subsection (c)(1)(E), by striking ``(b)(4)'' and
inserting ``(b)(2)''.
(c) Other Technical Amendments.--(1) Section 1833 (42 U.S.C. 1395l)
is amended by redesignating the subsection (r) added by section
4206(b)(2) of OBRA-1990 as subsection (s).
(2) Section 1866(f)(1) (42 U.S.C. 1395cc(f)(1)) is amended by
striking ``1833(r)'' and inserting ``1833(s)''.
(3) Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is amended by moving
subparagraph (O), as redesignated by section 13478(f)(8)(B)(iii)(II) of
this title, two ems to the left.
(4) Section 1881(b)(1)(C) (42 U.S.C. 1395rr(b)(1)(C)) is amended by
striking ``1861(s)(2)(Q)'' and inserting ``1861(s)(2)(P)''.
(5) Section 4201(d)(2) of OBRA-1990 is amended by striking ``(B) by
striking'', ``(C) by striking'', and ``(3) by adding'' and inserting
``(i) by striking'', ``(ii) by striking'', and ``(B) by adding'',
respectively.
(6)(A) Section 4207(a)(1) of OBRA-1990 is amended by adding closing
quotation marks and a period after ``such review.''.
(B) Section 4207(a)(4) of OBRA-1990 is amended by striking ``this
subsection'' and inserting ``paragraphs (2) and (3)''.
(C) Section 4207(b)(1) of OBRA-1990 is amended by striking
``section 3(7)'' and inserting ``section 601(a)(1)''.
(d) Effective Date.--The amendments made by this section shall take
effect as if included in the enactment of OBRA-1990.
CHAPTER 4--MEDICARE SUPPLEMENTAL INSURANCE POLICIES
SEC. 13571. STANDARDS FOR MEDICARE SUPPLEMENTAL INSURANCE POLICIES.
(a) Simplification of Medicare Supplemental Policies.--
(1) Section 4351 of OBRA-1990 is amended by striking ``(a)
In General.--''.
(2) Section 1882(p) (42 U.S.C. 1395ss(p)) is amended--
(A) in paragraph (1)(A)--
(i) by striking ``promulgates'' and
inserting ``changes the revised NAIC Model
Regulation (described in subsection (m)) to
incorporate'',
(ii) by striking ``(such limitations,
language, definitions, format, and standards
referred to collectively in this subsection as
`NAIC standards'),', and
(iii) by striking ``included a reference to
the NAIC standards'' and inserting ``were a
reference to the revised NAIC Model Regulation
as changed under this subparagraph (such
changed regulation referred to in this section
as the `1991 NAIC Model Regulation')'';
(B) in paragraph (1)(B)--
(i) by striking ``promulgate NAIC
standards'' and inserting ``make the changes in
the revised NAIC Model Regulation'',
(ii) by striking ``limitations, language,
definitions, format, and standards described in
clauses (i) through (iv) of such subparagraph
(in this subsection referred to collectively as
`Federal standards')'' and inserting ``a
regulation'', and
(iii) by striking ``included a reference to
the Federal standards'' and inserting ``were a
reference to the revised NAIC Model Regulation
as changed by the Secretary under this
subparagraph (such changed regulation referred
to in this section as the `1991 Federal
Regulation')'';
(C) in paragraph (1)(C)(i), by striking ``NAIC
standards or the Federal standards'' and inserting
``1991 NAIC Model Regulation or 1991 Federal
Regulation'';
(D) in paragraphs (1)(C)(ii)(I), (1)(E), (2), and
(9)(B), by striking ``NAIC or Federal standards'' and
inserting ``1991 NAIC Model Regulation or 1991 Federal
Regulation'';
(E) in paragraph (2)(C), by striking ``(5)(B)'' and
inserting ``(4)(B)'';
(F) in paragraph (4)(A)(i), by inserting ``or
paragraph (6)'' after ``(B)'';
(G) in paragraph (4), by striking ``applicable
standards'' each place it appears and inserting
``applicable 1991 NAIC Model Regulation or 1991 Federal
Regulation'';
(H) in paragraph (6), by striking ``in regard to
the limitation of benefits described in paragraph (4)''
and inserting ``described in clauses (i) through (iii)
of paragraph (1)(A)'';
(I) in paragraph (7), by striking ``policyholder''
and inserting ``policyholders'';
(J) in paragraph (8), by striking ``after the
effective date of the NAIC or Federal standards with
respect to the policy, in violation of the previous
requirements of this subsection'' and inserting ``on
and after the effective date specified in paragraph
(1)(C) (but subject to paragraph (10)), in violation of
the applicable 1991 NAIC Model Regulation or 1991
Federal Regulation insofar as such regulation relates
to the requirements of subsection (o) or (q) or clause
(i), (ii), or (iii) of paragraph (1)(A)'';
(K) in paragraph (9), by adding at the end the
following new subparagraph:
``(D) Subject to paragraph (10), this paragraph shall apply to
sales of policies occurring on or after the effective date specified in
paragraph (1)(C).''; and
(L) in paragraph (10), by striking ``this
subsection'' and inserting ``paragraph (1)(A)(i)''.
(b) Guaranteed Renewability.--Section 1882(q) (42 U.S.C. 1395ss(q))
is amended--
(1) in paragraph (2), by striking ``paragraph (2)'' and
inserting ``paragraph (4)'', and
(2) in paragraph (4), by striking ``the succeeding issuer''
and inserting ``issuer of the replacement policy''.
(c) Enforcement of Standards.--
(1) Section 1882(a)(2) (42 U.S.C. 1395ss(a)(2)) is
amended--
(A) in subparagraph (A), by striking ``NAIC
standards or the Federal standards'' and inserting
``1991 NAIC Model Regulation or 1991 Federal
Regulation'', and
(B) by striking ``after the effective date of the
NAIC or Federal standards with respect to the policy''
and inserting ``on and after the effective date
specified in subsection (p)(1)(C)''.
(2) The sentence in section 1882(b)(1) added by section
4353(c)(5) of OBRA-1990 is amended--
(A) by striking ``The report'' and inserting ``Each
report'',
(B) by inserting ``and requirements'' after
``standards'',
(C) by striking ``and'' after ``compliance,'', and
(D) by striking the comma after ``Commissioners''.
(3) Section 1882(g)(2)(B) (42 U.S.C. 1395ss(g)(2)(B)) is
amended by striking ``Panel'' and inserting ``Secretary''.
(4) Section 1882(b)(1) (42 U.S.C. 1395ss(b)(1)) is amended
by striking ``the the Secretary'' and inserting ``the
Secretary''.
(d) Preventing Duplication.--
(1) Section 1882(d)(3)(A) (42 U.S.C. 1395ss(d)(3)(A)) is
amended--
(A) by amending the first sentence to read as
follows:
``(i) It is unlawful for a person to sell or issue to an individual
entitled to benefits under part A or enrolled under part B of this
title--
``(I) a health insurance policy with knowledge that the
policy duplicates health benefits to which the individual is
otherwise entitled under this title or title XIX,
``(II) a medicare supplemental policy with knowledge that
the individual is entitled to benefits under another medicare
supplemental policy, or
``(III) a health insurance policy (other than a medicare
supplemental policy) with knowledge that the policy duplicates
health benefits to which the individual is otherwise entitled,
other than benefits to which the individual is entitled under a
requirement of State or Federal law.'';
(B) by designating the second sentence as clause
(ii) and, in such clause, by striking ``the previous
sentence'' and inserting ``clause (i)'';
(C) by designating the third sentence as clause
(iii) and, in such clause--
(i) by striking ``the previous sentence''
and inserting ``clause (i) with respect to the
sale of a medicare supplemental policy'', and
(ii) by striking ``and the statement'' and
all that follows up to the period at the end;
and
(D) by striking the last sentence.
(2) Section 1882(d)(3)(B) (42 U.S.C. 1395ss(d)(3)(B)) is
amended--
(A) in clause (ii)(II), by striking ``65 years of
age or older'',
(B) in clause (iii)(I), by striking ``another
medicare'' and inserting ``a medicare'',
(C) in clause (iii)(I), by striking ``such a
policy'' and inserting ``a medicare supplemental
policy'',
(D) in clause (iii)(II), by striking ``another
policy'' and inserting ``a medicare supplemental
policy'', and
(E) by amending subclause (III) of clause (iii) to
read as follows:
``(III) If the statement required by clause (i) is obtained and
indicates that the individual is entitled to any medical assistance
under title XIX, the sale of the policy is not in violation of clause
(i) (insofar as such clause relates to such medical assistance), if a
State medicaid plan under such title pays the premiums for the policy,
or, in the case of a qualified medicare beneficiary described in
section 1905(p)(1), if the State pays less than the full amount of
medicare cost-sharing as described in subparagraphs (B), (C), and (D)
of section 1905(p)(3) for such individual.''.
(3)(A) Section 1882(d)(3)(C) (42 U.S.C. 1395ss(d)(3)(C)) is
amended--
(i) by striking ``the selling'' and inserting ``(i)
the sale or issuance'', and
(ii) by inserting before the period at the end the
following: ``, (ii) the sale or issuance of a policy or
plan described in subparagraph (A)(i)(I) (other than a
medicare supplemental policy to an individual entitled
to any medical assistance under title XIX) under which
all the benefits are fully payable directly to or on
behalf of the individual without regard to other health
benefit coverage of the individual but only if (for
policies sold or issued more than 60 days after the
date the statements are published or promulgated under
subparagraph (D)) there is disclosed in a prominent
manner as part of (or together with) the application
the applicable statement (specified under subparagraph
(D)) of the extent to which benefits payable under the
policy or plan duplicate benefits under this title, or
(iii) the sale or issuance of a policy or plan
described in subparagraph (A)(i)(III) under which all
the benefits are fully payable directly to or on behalf
of the individual without regard to other health
benefit coverage of the individual''.
(B) Section 1882(d)(3) (42 U.S.C. 1395ss(d)(3)) is amended
by adding at the end the following:
``(D)(i) If--
``(I) within the 90-day period beginning on the date of the
enactment of this subparagraph, the National Association of
Insurance Commissioners develops (after consultation with
consumer and insurance industry representatives) and submits to
the Secretary a statement for each of the types of health
insurance policies (other than medicare supplemental policies
and including, as separate types of policies, policies paying
directly to the beneficiary fixed, cash benefits) which are
sold to persons entitled to health benefits under this title,
of the extent to which benefits payable under the policy or
plan duplicate benefits under this title, and
``(II) the Secretary approves all the statements submitted
as meeting the requirements of subclause (I),
each such statement shall be (for purposes of subparagraph (C)) the
statement specified under this subparagraph for the type of policy
involved. The Secretary shall review and approve (or disapprove) all
the statements submitted under subclause (I) within 30 days after the
date of their submittal. Upon approval of such statements, the
Secretary shall publish such statements.
``(ii) If the Secretary does not approve the statements under
clause (i) or the statements are not submitted within the 90-day period
specified in such clause, the Secretary shall promulgate (after
consultation with consumer and insurance industry representatives and
not later than 90 days after the date of disapproval or the end of such
90-day period (as the case may be)) a statement for each of the types
of health insurance policies (other than medicare supplemental policies
and including, as separate types of policies, policies paying directly
to the beneficiary fixed, cash benefits) which are sold to persons
entitled to health benefits under this title, of the extent to which
benefits payable under the policy or plan duplicate benefits under this
title, and each such statement shall be (for purposes of subparagraph
(C)) the statement specified under this subparagraph for the type of
policy involved.''.
(C) The requirement of a disclosure under section
1882(d)(3)(C)(ii) of the Social Security Act shall not apply to
an application made for a policy or plan before 60 days after
the date of the Secretary of Health and Human Services
publishes or promulgates all the statements under section
1882(d)(3)(D) of such Act.
(4) Subparagraphs (A) and (B) of section 1882(q)(5) are
amended by striking ``of the Social Security Act''.
(e) Loss Ratios and Refunds of Premiums.--
(1) Section 1882(r) (42 U.S.C. 1395ss(r)) is amended--
(A) in paragraph (1), by striking ``or sold'' and
inserting ``or renewed (or otherwise provide coverage
after the date described in subsection (p)(1)(C))'';
(B) in paragraph (1)(A), by inserting ``for periods
after the effective date of these provisions'' after
``the policy can be expected'';
(C) in paragraph (1)(A), by striking
``Commissioners,'' and inserting ``Commissioners)'';
(D) in paragraph (1)(B), by inserting before the
period at the end the following: ``, treating policies
of the same type as a single policy for each standard
package'';
(E) by adding at the end of paragraph (1) the
following: ``For the purpose of calculating the refund
or credit required under paragraph (1)(B) for a policy
issued before the date specified in subsection
(p)(1)(C), the refund or credit calculation shall be
based on the aggregate benefits provided and premiums
collected under all such policies issued by an insurer
in a State (separated as to individual and group
policies) and shall be based only on aggregate benefits
provided and premiums collected under such policies
after the date specified in section 13571(m)(4) of the
Omnibus Budget Reconciliation Act of 1993.'';
(F) in the first sentence of paragraph (2)(A), by
striking ``by policy number'' and inserting ``by
standard package'';
(G) by striking the second sentence of paragraph
(2)(A) and inserting the following: ``Paragraph (1)(B)
shall not apply to a policy until 12 months following
issue.'';
(H) in the last sentence of paragraph (2)(A), by
striking ``in order'' and all that follows through
``are effective'';
(I) by adding at the end of paragraph (2)(A), the
following new sentence: ``In the case of a policy
issued before the date specified in subsection
(p)(1)(C), paragraph (1)(B) shall not apply until 1
year after the date specified in section 13571(m)(4) of
the Omnibus Budget Reconciliation Act of 1993.'';
(J) in paragraph (2), by striking ``policy year''
each place it appears and inserting ``calendar year'';
(K) in paragraph (4), by striking ``February'',
``disllowance'', ``loss-ratios'' each place it appears,
and ``loss-ratio'' and inserting ``October'',
``disallowance'', ``loss ratios'', and ``loss ratio'',
respectively;
(L) in paragraph (6)(A), by striking ``issues a
policy in violation of the loss ratio requirements of
this subsection'' and ``such violation'' and inserting
``fails to provide refunds or credits as required in
paragraph (1)(B)'' and ``policy issued for which such
failure occurred'', respectively; and
(M) in paragraph (6)(B), by striking ``to
policyholders'' and inserting ``to the policyholder or,
in the case of a group policy, to the certificate
holder''.
(2) Section 1882(b)(1) (42 U.S.C. 1395ss(b)(1)) is amended,
in the matter after subparagraph (H), by striking ``subsection
(F)'' and inserting ``subparagraph (F)''.
(3) Section 4355(d) of OBRA-1990 is amended by striking
``sold or issued'' and all that follows and inserting ``issued
or renewed (or otherwise providing coverage after the date
described in section 1882(p)(1)(C) of the Social Security Act)
on or after the date specified in section 1882(p)(1)(C) of such
Act.''.
(f) Treatment of HMO's.--
(1) Section 1882(g)(1) (42 U.S.C. 1395ss(g)(1)) is amended
by striking ``a health maintenance organization or other direct
service organization'' and all that follows through ``1833''
and inserting ``an eligible organization (as defined in section
1876(b)) if the policy or plan provides benefits pursuant to a
contract under section 1876 or an approved demonstration
project described in section 603(c) of the Social Security
Amendments of 1983, section 2355 of the Deficit Reduction Act
of 1984, or section 9412(b) of the Omnibus Budget
Reconciliation Act of 1986 or, during the period beginning on
the date specified in subsection (p)(1)(C) and ending on
December 31, 1994, a policy or plan of an organization if the
policy or plan provides benefits pursuant to an agreement under
section 1833(a)(1)(A)''.
(2) Section 4356(b) of OBRA-1990 is amended by striking
``on the date of the enactment of this Act'' and inserting ``on
the date specified in section 1882(p)(1)(C) of the Social
Security Act''.
(g) Pre-existing Condition Limitations.--Section 1882(s) (42 U.S.C.
1395ss(s)) is amended--
(1) in paragraph (2)(A), by striking ``for which an
application is submitted'' and inserting ``in the case of an
individual for whom an application is submitted prior to or'',
(2) in paragraph (2)(A), by striking ``in which the
individual (who is 65 years of age or older) first is enrolled
for benefits under part B'' and inserting ``as of the first day
on which the individual is 65 years of age or older and is
enrolled for benefits under part B'', and
(3) in paragraph (2)(B), by striking ``before it'' and
inserting ``before the policy''.
(h) Medicare Select Policies.--
(1) Section 1882(t) (42 U.S.C. 1395ss(t)) is amended--
(A) in paragraph (1), by inserting ``medicare
supplemental'' after ``If a'',
(B) in paragraph (1), by striking ``NAIC Model
Standards'' and inserting ``1991 NAIC Model Regulation
or 1991 Federal Regulation'',
(C) in paragraph (1)(A), by inserting ``or
agreements'' after ``contracts'',
(D) in subparagraphs (E)(i) and (F) of paragraph
(1), by striking ``NAIC standards'' and inserting
``standards in the 1991 NAIC Model Regulation or 1991
Federal Regulation'', and
(E) in paragraph (2), by inserting ``the issuer''
before ``is subject to a civil money penalty''.
(2) Section 1154(a)(4)(B) (42 U.S.C. 1320c-3(a)(4)(B)) is
amended--
(A) by inserting ``that is'' after ``(or'', and
(B) by striking ``1882(t)'' and inserting
``1882(t)(3)''.
(i) Health Insurance Counseling.--Section 4360 of OBRA-1990 is
amended--
(1) in subsection (b)(2)(A)(ii), by striking ``Act'' and
inserting ``Act)'';
(2) in subsection (b)(2)(D), by striking ``services'' and
inserting ``counseling'';
(3) in subsection (b)(2)(I), by striking ``assistance'' and
inserting ``referrals'';
(4) in subsection (c)(1), by striking ``and that such
activities will continue to be maintained at such level'';
(5) in subsection (d)(3), by striking ``to the rural
areas'' and inserting ``eligible individuals residing in rural
areas'';
(6) in subsection (e)--
(A) by striking ``subsection (c) or (d)'' and
inserting ``this section'',
(B) by striking ``and annually thereafter, issue an
annual report'' and inserting ``and annually thereafter
during the period of the grant, issue a report'', and
(C) in paragraph (1), by striking ``State-wide'';
(7) in subsection (f), by striking paragraph (2) and by
redesignating paragraphs (3) through (5) as paragraphs (2)
through (4), respectively; and
(8) by redesignating the second subsection (f) (relating to
authorization of appropriations for grants) as subsection (g).
(j) Telephone Information System.--
(1) Section 1804 (42 U.S.C. 1395b-2) is amended--
(A) by adding at the end of the heading the
following: ``; medicare and medigap information'',
(B) by inserting ``(a)'' after ``1804.'', and
(C) by adding at the end the following new
subsection:
``(b) The Secretary shall provide information via a toll-free
telephone number on the programs under this title.''.
(2) Section 1882(f) (42 U.S.C. 1395ss(f)) is amended by
adding at the end the following new paragraph:
``(3) The Secretary shall provide information via a toll-free
telephone number on medicare supplemental policies (including the
relationship of State programs under title XIX to such policies).''.
(3) Section 1889 is repealed.
(k) Mailing of Policies.--Section 1882(d)(4) (42 U.S.C.
1395ss(d)(4)) is amended--
(1) in subparagraph (D), by striking ``, if such policy''
and all that follows up to the period at the end, and
(2) by adding at the end the following new subparagraph:
``(E) Subparagraph (A) shall not apply in the case of an issuer who
mails or causes to be mailed a policy, certificate, or other matter
solely to comply with the requirements of subsection (q).''.
(l) Effective Date.--The amendments made by this section shall be
effective as if included in the enactment of OBRA-1990; except that--
(1) the amendments made by subsection (d)(1) shall take
effect on the date of the enactment of this Act, but no penalty
shall be imposed under section 1882(d)(3)(A) of the Social
Security Act (for an action occurring after the effective date
of the amendments made by section 4354 of OBRA-1990 and before
the date of the enactment of this Act) with respect to the sale
or issuance of a policy which is not unlawful under section
1882(d)(3)(A)(i)(II) of the Social Security Act (as amended by
this section);
(2) the amendments made by subsection (d)(2)(A) and by
subparagraphs (A), (B), and (E) of subsection (e)(1) shall be
effective on the date specified in subsection (m)(4); and
(3) the amendment made by subsection (g)(2) shall take
effect on January 1, 1994, and shall apply to individuals who
attain 65 years of age or older on or after the effective date
of section 1882(s)(2) of the Social Security Act (and, in the
case of individuals who attained 65 years of age after such
effective date and before January 1, 1994, and who were not
covered under such section before January 1, 1994, the 6-month
period specified in that section shall begin January 1, 1994).
(m) Transition Provisions.--
(1) In general.--If the Secretary of Health and Human
Services identifies a State as requiring a change to its
statutes or regulations to conform its regulatory program to
the changes made by this section, the State regulatory program
shall not be considered to be out of compliance with the
requirements of section 1882 of the Social Security Act due
solely to failure to make such change until the date specified
in paragraph (4).
(2) NAIC Standards.--If, within 6 months after the date of
the enactment of this Act, the National Association of
Insurance Commissioners (in this subsection referred to as the
``NAIC'') modifies its 1991 NAIC Model Regulation (adopted in
July 1991) to conform to the amendments made by this section
and to delete from section 15C the exception which begins with
``unless'', such modifications shall be considered to be part
of that Regulation for the purposes of section 1882 of the
Social Security Act.
(3) Secretary standards.--If the NAIC does not make the
modifications described in paragraph (2) within the period
specified in such paragraph, the Secretary of Health and Human
Services shall make the modifications described in such
paragraph and such modifications shall be considered to be part
of that Regulation for the purposes of section 1882 of the
Social Security Act.
(4) Date specified.--
(A) In general.--Subject to subparagraph (B), the
date specified in this paragraph for a State is the
earlier of--
(i) the date the State changes its statutes
or regulations to conform its regulatory
program to the changes made by this section, or
(ii) 1 year after the date the NAIC or the
Secretary first makes the modifications under
paragraph (2) or (3), respectively.
(B) Additional legislative action required.--In the
case of a State which the Secretary identifies as--
(i) requiring State legislation (other than
legislation appropriating funds) to conform its
regulatory program to the changes made in this
section, but
(ii) having a legislature which is not
scheduled to meet in 1994 in a legislative
session in which such legislation may be
considered,
the date specified in this paragraph is the first day
of the first calendar quarter beginning after the close
of the first legislative session of the State
legislature that begins on or after January 1, 1994.
For purposes of the previous sentence, in the case of a
State that has a 2-year legislative session, each year
of such session shall be deemed to be a separate
regular session of the State legislature.
CHAPTER 5--TREATMENT OF CERTAIN STATE HEALTH CARE PROGRAMS
SEC. 13581. TREATMENT OF CERTAIN STATE HEALTH CARE PROGRAMS.
Section 514(b)(5) of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1144(b)(5)) is amended to read as follows:
``(5)(A) Except as provided in subparagraphs (B) and (C),
subsection (a) shall not apply to the Hawaii Prepaid Health
Care Act (Haw. Rev. Stat. Sec. Sec. 393-1 through 393-51).
``(B) Nothing in subparagraph (A) shall be construed to
exempt from subsection (a) any State tax law relating to
employee benefits plans.
``(C) If the Secretary of Labor notifies the Governor of
the State of Hawaii that as the result of an amendment to the
Hawaii Prepaid Health Care Act enacted after October 5, 1992--
``(i) the proportion of the population with health
care coverage under such Act is less than such
proportion on such date, or
``(ii) the level of benefit coverage provided under
such Act is less than the actuarial equivalent of such
level of coverage on such date,
subparagraph (A) shall not apply with respect to the
application of such amendment to such Act after the date of
such notification.''.
Subtitle D--Customs and Trade Provisions
SEC. 13601. CUSTOMS AND TRADE AGENCY AUTHORIZATIONS FOR FISCAL YEARS
1994 AND 1995.
(a) United States International Trade Commission.--Section
330(e)(2) of the Tariff Act of 1930 (19 U.S.C. 1330(e)(2)) is amended
to read as follows:
``(2)(A) There are authorized to be appropriated to the Commission
for necessary expenses (including the rental of conference rooms in the
District of Columbia and elsewhere) not to exceed the following:
``(i) $45,416,000 for fiscal year 1994.
``(ii) $45,974,000 for fiscal year 1995.
``(B) Not to exceed $2,500 of the amount authorized to be
appropriated for any fiscal year under subparagraph (A) may be used,
subject to the approval of the Chairman of the Commission, for
reception and entertainment expenses.
``(C) No part of any sum that is appropriated under the authority
of subparagraph (A) may be used by the Commission in the making of any
special study, investigation, or report that is requested by any agency
of the executive branch unless that agency reimburses the Commission
for the cost thereof.''.
(b) United States Customs Service.--Section 301(b) of the Customs
Procedural Reform and Simplification Act of 1978 (19 U.S.C. 2075(b)) is
amended to read as follows:
``(b) Authorization of Appropriations.--
``(1) For noncommercial operations.--There are authorized
to be appropriated for the salaries and expenses of the Customs
Service that are incurred in noncommercial operations not to
exceed the following:
``(A) $540,783,000 for fiscal year 1994.
``(B) $527,000,000 for fiscal year 1995.
``(2) For commercial operations.--(A) There are authorized
to be appropriated for the salaries and expenses of the Customs
Service that are incurred in commercial operations not less
than the following:
``(i) $771,036,000 for fiscal year 1994.
``(ii) $748,000,000 for fiscal year 1995.
``(B) The monies authorized to be appropriated under
subparagraph (A) for any fiscal year, except for such sums as
may be necessary for the salaries and expenses of the Customs
Service that are incurred in connection with the processing of
merchandise that is exempt from the fees imposed under section
13031(a) (9) and (10) of the Consolidated Omnibus Budget
Reconciliation Act of 1985, shall be appropriated from the
Customs User Fee Account.
``(3) For air and marine interdiction.--There are
authorized to be appropriated for the operation (including
salaries and expenses) and maintenance of the air and marine
interdiction programs of the Customs Service not to exceed the
following:
``(A) $95,156,000 for fiscal year 1994.
``(B) $128,000,000 for fiscal year 1995.''.
(c) Office of the United States Trade Representative.--Section
141(g)(1) of the Trade Act of 1974 (19 U.S.C. 2171(g)(1)) is amended to
read as follows:
``(g)(1)(A) There are authorized to be appropriated to the Office
for the purposes of carrying out its functions not to exceed the
following:
``(i) $20,143,000 for fiscal year 1994.
``(ii) $20,419,000 for fiscal year 1995.
``(B) Of the amounts authorized to be appropriated under
subparagraph (A) for any fiscal year--
``(i) not to exceed $98,000 may be used for entertainment
and representation expenses of the Office; and
``(ii) not to exceed $2,500,000 shall remain available
until expended.''.
SEC. 13602. EXTENSION OF AUTHORITY TO LEVY CUSTOMS USER FEES.
Section 13031(j)(3) of the Consolidated Omnibus Budget
Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)) is amended by striking
out ``1995'' and inserting ``1998''.
SEC. 13603. GENERALIZED SYSTEM OF PREFERENCES.
(a) Treatment of Countries Formerly Within the Union of Soviet
Socialist Republics.--The table in section 502(b) of the Trade Act of
1974 (19 U.S.C. 2462(b)) is amended by striking out ``Union of Soviet
Socialist Republics''.
(b) Extension of Duty-Free Treatment Under System.--
(1) In general.--Section 505(a) of the Trade Act of 1974
(19 U.S.C. 2465(a)) is amended by striking out ``July 4, 1993''
and inserting ``September 30, 1994''.
(2) Retroactive application for certain liquidations and
reliquidations.--Notwithstanding section 514 of the Tariff Act
of 1930 or any other provision of law, upon proper request
filed with the appropriate customs officer within 180 days
after the date of the enactment of this Act, the entry--
(A) of any article to which duty-free treatment
under title V of the Trade Act of 1974 would have
applied if the entry had been made on July 4, 1993, and
(B) that was made after July 4, 1993, and before
such date of enactment,
shall be liquidated or reliquidated as free of duty, and the
Secretary of the Treasury shall refund any duty paid with
respect to such entry. As used in this paragraph, the term
``entry'' includes a withdrawal from warehouse for consumption.
SEC. 13604. EXTENSION OF, AND AUTHORIZATION OF APPROPRIATIONS FOR, THE
WORKER TRADE ADJUSTMENT ASSISTANCE PROGRAM.
(a) Extension.--Section 285 of the Trade Act of 1974 (19 U.S.C.
note preceding 2271) is amended--
(1) by striking out ``No'' and all that follows thereafter
down through ``chapter 2, no'' in subsection (b) and inserting
``No''; and
(2) by adding at the end the following new subsection:
``(c) No assistance, vouchers, allowances, or other payments may be
provided under chapter 2 after September 30, 1996.''.
(b) Authorization of Appropriations.--Section 245 of the Trade Act
of 1974 (19 U.S.C. 2317) is amended by striking out ``and 1993,'' and
inserting ``1993, 1994, 1995, and 1996,''.
SEC. 13605. EXTENSION OF URUGUAY ROUND TRADE AGREEMENT NEGOTIATING AND
PROCLAMATION AUTHORITY AND OF ``FAST TRACK'' PROCEDURES
TO IMPLEMENTING LEGISLATION.
Section 1102 of the Omnibus Trade and Competitiveness Act of 1988
(19 U.S.C. 2902) is amended by inserting at the end the following new
subsection:
``(e) Special Provisions Regarding Uruguay Round Trade
Negotiations.--
``(1) In general.--Notwithstanding the time limitations in
subsections (a) and (b), if the Uruguay Round of multilateral
trade negotiations under the auspices of the General Agreement
on Tariffs and Trade has not resulted in trade agreements by
May 31, 1993, the President may, during the period after May
31, 1993, and before April 16, 1994, enter into, under
subsections (a) and (b), trade agreements resulting from such
negotiations.
``(2) Application of tariff proclamation authority.--No
proclamation under subsection (a) to carry out the provisions
regarding tariff barriers of a trade agreement that is entered
into pursuant to paragraph (1) may take effect before the
effective date of a bill that implements the provisions
regarding nontariff barriers of a trade agreement that is
entered into under such paragraph.
``(3) Application of implementing and `fast track'
procedures.--Section 1103 applies to any trade agreement
negotiated under subsection (b) pursuant to paragraph (1),
except that--
``(A) in applying subsection (a)(1)(A) of section
1103 to any such agreement, the phrase `at least 120
calendar days before the day on which he enters into
the trade agreement (but not later than December 15,
1993),' shall be substituted for the phrase `at least
90 calendar days before the day on which he enters into
the trade agreement; and
``(B) no provision of subsection (b) of section
1103 other than paragraph (1)(A) applies to any such
agreement and in applying such paragraph, `April 16,
1994;' shall be substituted for `June 1, 1991;'.
``(4) Advisory committee reports.--The report required
under section 135(e)(1) of the Trade Act of 1974 regarding any
trade agreement provided for under paragraph (1) shall be
provided to the President, the Congress, and the United States
Trade Representative not later than 30 days after the date on
which the President notifies the Congress under section
1103(a)(1)(A) of his intention to enter into the agreement (but
before January 15, 1994).''.
SEC. 13606. REPEAL OF EAST-WEST TRADE STATISTICS MONITORING SYSTEM.
(a) Repeal.--Section 410 of the Trade Act of 1974 (19 U.S.C. 2440)
is repealed.
(b) Conforming Amendment.--The table of contents for such Act of
1974 is amended by striking out the following:
``Sec. 410. East-West Trade Statistics Monitoring System.''.
Subtitle E--Customs Officer Pay Reform
SEC. 13701. OVERTIME AND PREMIUM PAY FOR CUSTOMS OFFICERS.
(a) In General.--Section 5 of the Act of February 13, 1911 (19
U.S.C. 261 and 267) is amended to read as follows:
``SEC. 5. OVERTIME AND PREMIUM PAY FOR CUSTOMS OFFICERS.
``(a) Overtime Pay.--
``(1) In general.--Subject to paragraph (2) and subsection
(c), a customs officer who is officially assigned to perform
work in excess of 40 hours in the administrative workweek of
the officer or in excess of 8 hours in a day shall be
compensated for that work at an hourly rate of pay that is
equal to 2 times the hourly rate of the basic pay of the
officer. For purposes of this paragraph, the hourly rate of
basic pay for a customs officer does not include any premium
pay provided for under subsection (b).
``(2) Special provisions relating to overtime work on
callback basis.--
``(A) Minimum duration.--Any work for which
compensation is authorized under paragraph (1) and for
which the customs officer is required to return to the
officer's place of work shall be treated as being not
less than 2 hours in duration; but only if such work
begins at least 1 hour after the end of any previous
regularly scheduled work assignment and ends at least 1
hour before the beginning of the following regularly
scheduled work assignment.
``(B) Compensation for commuting time.--
``(i) In general.--Except as provided in
clause (ii), in addition to the compensation
authorized under paragraph (1) for work to
which subparagraph (A) applies, the customs
officer is entitled to be paid, as compensation
for commuting time, an amount equal to 3 times
the hourly rate of basic pay of the officer.
``(ii) Exception.--Compensation for
commuting time is not payable under clause (i)
if the work for which compensation is
authorized under paragraph (1)--
``(I) does not commence within 16
hours of the customs officer's last
regularly scheduled work assignment, or
``(II) commences within 2 hours of
the next regularly scheduled work
assignment of the customs officer.
``(b) Premium Pay for Customs Officers.--
``(1) Night work differential.--
``(A) 3 p.m. to midnight shiftwork.--If the
majority of the hours of regularly scheduled work of a
customs officer occur during the period beginning at 3
p.m. and ending at 12 a.m., the officer is entitled to
pay for work during such period (except for work to
which paragraph (2) or (3) applies) at the officer's
hourly rate of basic pay plus premium pay amounting to
15 percent of that basic rate.
``(B) 11 p.m. to 8 a.m. shiftwork.--If the majority
of the hours of regularly scheduled work of a customs
officer occur during the period beginning at 11 p.m.
and ending at 8 a.m., the officer is entitled to pay
for work during such period (except for work to which
paragraph (2) or (3) applies) at the officer's hourly
rate of basic pay plus premium pay amounting to 20
percent of that basic rate.
``(C) 7:30 p.m. to 3:30 a.m. shiftwork.--If the
regularly scheduled work assignment of a customs
officer is 7:30 p.m. to 3:30 a.m., the officer is
entitled to pay for work during such period (except for
work to which paragraph (2) or (3) applies) at the
officer's hourly rate of basic pay plus premium pay
amounting to 15 percent of that basic rate for the
period from 7:30 p.m. to 11:30 p.m. and at the
officer's hourly rate of basic pay plus premium pay
amounting to 20 percent of that basic rate for the
period from 11:30 p.m. to 3:30 a.m.
``(2) Sunday differential.--A customs officer who performs
any regularly scheduled work on a Sunday that is not a holiday
is entitled to pay for that work at the officer's hourly rate
of basic pay plus premium pay amounting to 50 percent of that
basic rate.
``(3) Holiday differential.--A customs officer who performs
any regularly scheduled work on a holiday is entitled to pay
for that work at the officer's hourly rate of basic pay plus
premium pay amounting to 100 percent of that basic rate.
``(4) Treatment of premium pay.--Premium pay provided for
under this subsection may not be treated as being overtime pay
or compensation for any purpose.
``(c) Limitations.--
``(1) Fiscal year cap.--The aggregate of overtime pay under
subsection (a) (including commuting compensation under
subsection (a)(2)(B)) and premium pay under subsection (b) that
a customs officer may be paid in any fiscal year may not exceed
$25,000; except that the Commissioner of Customs or his
designee may waive this limitation in individual cases in order
to prevent excessive costs or to meet emergency requirements of
the Customs Service.
``(2) Exclusivity of pay under this section.--A customs
officer who receives overtime pay under subsection (a) or
premium pay under subsection (b) for time worked may not
receive pay or other compensation for that work under any other
provision of law.
``(d) Regulations.--The Secretary of the Treasury shall prescribe
such regulations as are necessary or appropriate to carry out this
section, including regulations--
``(1) to ensure that callback work assignments are
commensurate with the overtime pay authorized for such work;
and
``(2) to prevent the disproportionate assignment of
overtime work to customs officers who are near to retirement.
``(e) Definitions.--As used in this section:
``(1) The term `customs officer' means an individual
performing those functions specified by regulation by the
Secretary of the Treasury for a customs inspector or canine
enforcement officer. Such functions shall be consistent with
such applicable standards as may be promulgated by the Office
of Personnel Management.
``(2) The term `holiday' means any day designated as a
holiday under a Federal statute or Executive order.''.
(b) Conforming Amendments.--
(1) Section 2 of the Act of June 3, 1944 (19 U.S.C. 1451a),
is repealed.
(2) Section 450 of the Tariff Act of 1930 (19 U.S.C. 1450)
is amended--
(A) by striking out ``at night'' in the section
heading and inserting ``during overtime hours'';
(B) by striking out ``at night'' and inserting
``during overtime hours''; and
(C) by inserting ``aircraft,'' immediately before
``vessel''.
(c) Effective Date.--The amendments made by subsections (a) and (b)
apply to customs inspectional services provided on or after October 1,
1993.
SEC. 13702. FOREIGN LANGUAGE PROFICIENCY AWARDS FOR CUSTOMS OFFICERS.
Cash awards for foreign language proficiency may, under regulations
prescribed by the Secretary of the Treasury, be paid to customs
officers (as referred to in section 5(e)(1) of the Act of February 13,
1911) to the same extent and in the same manner as would be allowable
under subchapter III of chapter 45 of title 5, United States Code, with
respect to law enforcement officers (as defined by section 4521 of such
title).
SEC. 13703. APPROPRIATIONS REIMBURSEMENTS FROM THE CUSTOMS USER FEE
ACCOUNT.
Section 13031(f)(3) of the Consolidated Omnibus Budget
Reconciliation Act of 1985 (19 U.S.C. 58c(f)(3)) is amended--
(1) by amending clause (i) of subparagraph (A) to read as
follows: ``(i) in--
``(I) paying overtime compensation under section
5(a) of the Act of February 13, 1911,
``(II) paying premium pay under section 5(b) of the
Act of February 13, 1911, but the amount for which
reimbursement may be made under this subclause may not,
for any fiscal year, exceed the difference between the
cost of the premium pay for that year calculated under
such section 5(b) as amended by section 13701 of the
Omnibus Budget Reconciliation Act of 1993 and the cost
of such pay calculated under subchapter V of chapter 55
of title 5, United States Code,
``(III) paying agency contributions to the Civil
Service Retirement and Disability Fund to match
deductions from the overtime compensation paid under
subclause (I), and
``(IV) providing all preclearance services for
which the recipients of such services are not required
to reimburse the Secretary of the Treasury, and'';
(2) by inserting before the flush sentence appearing after
clause (ii) of subparagraph (A) the following sentence: ``The
transfer of funds required under subparagraph (C)(iii) has
priority over reimbursements under this subparagraph to carry
out subclauses (II), (III), and (IV) of clause (i).'';
(3) by striking out ``except for costs described in
subparagraph (A)(i) (I) and (II),'' in subparagraph (B)(i); and
(4) by amending subparagraph (C)--
(A) by striking out ``to fully reimburse
inspectional overtime and preclearance costs'' in
clause (i) and inserting ``to reimburse costs described
in subparagraph (A)(i)''; and
(B) by inserting after clause (ii) of subparagraph
(C) the following:
``(iii) For each fiscal year, the Secretary of the Treasury
shall calculate the difference between--
``(I) the estimated cost for overtime compensation
that would have been incurred during that fiscal year
for inspectional services if section 5 of the Act of
February 13, 1911 (19 U.S.C. 261 and 267), as in effect
before the enactment of section 13701 of the Omnibus
Budget Reconciliation Act of 1993, had governed such
costs, and
``(II) the actual cost for overtime compensation,
premium pay, and agency retirement contributions that
is incurred during that fiscal year in regard to such
services under section 5 of the Act of February 13,
1991, as amended by section 13701 of the Omnibus Budget
Reconciliation Act of 1993, and under section 8331(3)
of title 5, United States Code, as amended by section
13704 of such Act of 1993,
and shall transfer from the Customs User Fee Account to the
General Fund of the Treasury an amount equal to the difference
calculated under this clause, or $18,000,000, whichever amount
is less. Transfers shall be made under this clause at least
quarterly and on the basis of estimates to the same extent as
are reimbursements under subparagraph (B)(iii).''.
SEC. 13704. TREATMENT OF CERTAIN PAY OF CUSTOMS OFFICERS FOR RETIREMENT
PURPOSES.
(a) In General.--Section 8331(3) of title 5, United States Code, is
amended--
(1) by striking out ``and'' at the end of subparagraph (C);
(2) by striking out the semicolon at the end of
subparagraph (D) and inserting ``; and'';
(3) by adding after subparagraph (D) the following:
``(E) with respect to a customs officer (referred
to in subsection (e)(1) of section 5 of the Act of
February 13, 1911), compensation for overtime
inspectional services provided for under subsection (a)
of such section 5, but not to exceed 50 percent of any
statutory maximum in overtime pay for customs officers
which is in effect for the year involved;''; and
(4) by striking out ``subparagraphs (B), (C), and (D) of
this paragraph,'' and inserting ``subparagraphs (B), (C), (D),
and (E) of this paragraph''.
(b) Effective Date.--The amendments made by subsection (a) take
effect on the date of the enactment of this Act and apply only with
respect to service performed on or after such date.
SEC. 13705. REPORTS.
(a) Customs User Fee Account Reports.--Subparagraph (D) of section
13031(f)(3) of the Consolidated Omnibus Budget Reconciliation Act of
1985 (19 U.S.C. 58c(f)(3)(D)) is amended to read as follows:
``(D) At the close of each fiscal year, the
Secretary of the Treasury shall submit a report to the
Committee on Finance of the Senate and the Committee on
Ways and Means of the House of Representatives--
``(i) containing a detailed accounting of
all expenditures from the Customs User Fee
Account during such year, including a summary
of the expenditures, on a port-by-port basis,
for which reimbursement has been provided under
subparagraph (A)(ii);
``(ii) containing a listing of all callback
assignments of customs officers for which
overtime compensation was paid under section
5(a) of the Act of February 13, 1911, and that
were less than 1 hour in duration; and
``(iii) containing a listing of all customs
officers who were paid $25,000 or more under
subsections 5(a) and 5(b) of the Act of
February 13, 1911, including a listing of the
total compensation paid to each of those
customs officers under all other statutory
authority.''.
(b) Other Reports.--
(1) GAO report.--The Comptroller General of the United
States shall undertake--
(A) an evaluation of the appropriateness and
efficiency of the customs user fee laws for financing
the provision of customs inspectional services; and
(B) a study to determine whether cost savings in
the provision of overtime inspectional services could
be realized by the United States Customs Service
through the use of additional inspectors as opposed to
continuing the current practice of relying on overtime
pay.
The Comptroller General shall submit a report on the evaluation
and study required under this subsection to the Committees by
no later than the 1st anniversary of the date of the enactment
of this Act.
(2) Treasury recommendation.--On the day that the President
submits the budget for the United States Government for fiscal
year 1995 to the Congress under section 1105(a) of title 31,
United States Code, the Secretary of the Treasury shall submit
to the Committees recommended legislative proposals for
improving the operation of customs user fee laws in financing
the provision of customs inspectional services.
(3) Definition of committees.--For purposes of this
subsection, the term ``Committees'' means the Committee on Ways
and Means of the House of Representatives and the Committee on
Finance of the Senate.
TITLE XIV--REVENUE PROVISIONS
SEC. 14001. SHORT TITLE; ETC.
(a) Short Title.--This title may be cited as the ``Revenue
Reconciliation Act of 1993''.
(b) Amendment to 1986 Code.--Except as otherwise expressly
provided, whenever in this title an amendment or repeal is expressed in
terms of an amendment to, or repeal of, a section or other provision,
the reference shall be considered to be made to a section or other
provision of the Internal Revenue Code of 1986.
(c) Section 15 Not To Apply.--Except in the case of the amendments
made by section 14221 (relating to corporate rate increase), no
amendment made by this title shall be treated as a change in a rate of
tax for purposes of section 15 of the Internal Revenue Code of 1986.
(d) Waiver of Estimated Tax Penalties.--No addition to tax shall be
made under section 6654 or 6655 of the Internal Revenue Code of 1986
for any period before April 16, 1994 (March 16, 1994, in the case of a
corporation), with respect to any underpayment to the extent such
underpayment was created or increased by any provision of this title.
(e) Table of Contents.--
TITLE XIV--REVENUE PROVISIONS
Sec. 14001. Short title; etc.
Subtitle A--Training and Investment Incentives
Part I--Provisions Relating to Education and Training
Sec. 14101. Employer-provided educational assistance.
Sec. 14102. Targeted jobs credit.
Pasubpart a--research credites
Sec. 14111. Permanent extension of research credit.
Sec. 14112. Modification of fixed base percentage for startup
subpart b--capital gain provisions
Sec. 14113. 50-percent exclusion for gain from certain small business
stock.
Sec. 14114. Rollover of gain from sale of publicly traded securities
into specialized small business investment
subpart c--modifications to minimum tax depreciation rules
Sec. subpart d--increase in expense treatment for small businesses
Sec. 14116. Increase in expense treatment for small businesses.
Part III--Tax-Exempt Bond Provisions
Sec. 14121. High-speed intercity rail facility bonds exempt from State
volume cap.
Sec. 14122. Permanent extension of qualified small issue bonds.
Part IV--Expansion and Simplification of Earned Income Tax Credit
Sec. 14131. Expansion and simplification of earned income tax credit.
subpart a--extension of qualified mortgage bonds and low-income housing
credit
Sec. 14141. Permanent extension of qualified mortgage bonds.
Sec. 14142. Psubpart b--modification of passive loss rulesit.
Sec. 14143. Application of passive loss rules to rental real estate
subpart c--provisions relating to real estate investments by pension
funds
Sec. 14144. Real estate property acquired by a qualified organization.
Sec. 14145. Repeal of special treatment of publicly traded
partnerships.
Sec. 14146. Title-holding companies permitted to receive small amounts
of unrelated business taxable income.
Sec. 14147. Exclusion from unrelated business tax of gains from certain
property.
Sec. 14148. Exclusion from unrelated business tax of certain fees and
option premiums.
Sec. 14149. Treatment of pension fund investments in real estate
subpart d--discharge of indebtedness
Sec. 14150. Exclusion from gross income for income from discharge of
qualified real property business
subpart e--increase in recovery period for nonresidential real property
Sec. 14151. Increase in recovery period for nonresidential real
property.
Part VI--Luxury Tax
Sec. 14161. Repeal of luxury excise taxes other than on passenger
vehicles.
Sec. 14162. Exemption from luxury excise tax for certain equipment
installed on passenger vehicles for use by
disabled individuals.
Sec. 14163. Tax on diesel fuel used in noncommercial boats.
Part VII--Other Changes
Sec. 14171. Alternative minimum tax treatment of contributions of
appreciated property.
Sec. 14172. Certain transfers to railroad retirement account made
permanent.
Sec. 14173. Temporary extension of deduction for health insurance costs
of self-employed individuals.
Subtitle B--Revenue Increases
Part I-subpart a--rate increasesividuals
Sec. 14201. Increase in top marginal rate under section 1.
Sec. 14202. Surtax on high-income taxpayers.
Sec. 14203. Modifications to alternative minimum tax rates and
exemption amounts.
Sec. 14204. Overall limitation on itemized deductions for high-income
taxpayers made permanent.
Sec. 14205. Phaseout of personal exemption of high-income taxpayers
made permanent.
Sec. 14206. Provisions to prevent conversion of ordinary income to
subpart b--other provisions
Sec. 14207. Repeal of limitation on amount of wages subject to health
insurance employment tax.
Sec. 14208. Top estate and gift tax rates made permanent.
Sec. 14209. Reduction in deductible portion of business meals and
entertainment.
Sec. 14210. Elimination of deduction for club membership fees.
Sec. 14211. Disallowance of deduction for certain employee remuneration
in excess of $1,000,000.
Sec. 14212. Reduction in compensation taken into account in determining
contributions and benefits under qualified
retirement plans.
Sec. 14213. Modification to deduction for certain moving expenses.
Sec. 14214. Simplification of individual estimated tax safe harbor
based on last year's tax.
Sec. 14215. Social security and tier 1 railroad retirement benefits.
Part II--Provisions Affecting Businesses
Sec. 14221. Increase in top marginal rate under section 11.
Sec. 14222. Denial of deduction for lobbying expenses.
Sec. 14223. Mark to market accounting method for securities dealers.
Sec. 14224. Clarification of treatment of certain FSLIC financial
assistance.
Sec. 14225. Modification of corporate estimated tax rules.
Sec. 14226. Limitation on section 936 credit.
Sec. 14227. Modification to limitation on deduction for certain
interest.
subpart a--current taxation of certain earnings of controlled foreign
corporations
Sec. 14231. Earnings invested in excess passive assets.
Sec. 14232. Modification to taxation of investment in United States
property.
Sec.subpart b--allocation of research and experimental expenditures
Sec. 14234. Allocationsubpart c--other provisionsal expenditures.
Sec. 14235. Repeal of certain exceptions for working capital.
Sec. 14236. Modifications of accuracy-related penalty.
Sec. 14237. Denial of portfolio interest exemption for contingent
interest.
Sec. 14238. Regulations dealing with conduit arrangements.
subpart a--energy tax based on btu content
Sec. 14241. Isubpart b--modifications to tax on diesel fuel
Sec. 14242. Modifications to tax on diesel fuel.
Ssubpart c--extension of motor fuel tax rates; increased deposits into
highway trust fund
Sec. 14244. Extension of motor fuel tax rates; increased deposits into
highway trust fund.
Part V--Compliance Provisions
Sec. 14251. Reporting required for certain payments to corporations.
Sec. 14252. Modifications to substantial understatement and return-
preparer penalties.
Sec. 14253. Returns relating to the cancellation of indebtedness by
certain financial entities.
Part VI--Treatment of Intangibles
Sec. 14261. Amortization of goodwill and certain other intangibles.
Sec. 14262. Treatment of certain payments to retired or deceased
partner.
Part VII--Miscellaneous Provisions
Sec. 14271. Substantiation requirement for deduction of certain
charitable contributions.
Sec. 14272. Disclosure related to quid pro quo contributions.
Sec. 14273. Disallowance of interest on certain overpayments of tax.
Sec. 14274. Denial of deduction relating to travel expenses.
Sec. 14275. Increase in withholding from supplemental wage payments.
Subtitle C--Empowerment Zones and Enterprise Communities, Etc.
Part I--Empowerment Zones and Enterprise Communities
Sec. 14301. Designation and treatment of empowerment zones and
enterprise communities.
Sec. 14302. Expansion of targeted jobs credit.
Sec. 14303. Technical and conforming amendments.
Sec. 14304. Effective date.
Part II--Credit for Contributions to Certain Community Development
Corporations
Sec. 14311. Credit for contributions to certain community development
corporations.
Subtitle D--Other Provisions
Part I--Disclosure Provisions
Sec. 14401. Disclosure of return information for administration of
certain veterans programs.
Sec. 14402. Disclosure of return information to carry out income
contingent repayment of student loans.
Sec. 14403. Use of return information for income verification under
certain housing assistance programs.
Part II--User Fee Provisions
Sec. 14411. Fees for applications for alcohol labeling and formula
reviews.
Sec. 14412. Use of Harbor Maintenance Trust Fund amounts for
administrative expenses.
Sec. 14413. Increase in tax on fuel used in commercial transportation
on inland waterways.
Part III--Public Debt Limit
Sec. 14421. Increase in public debt limit.
Part IV--Vaccine Provisions
Sec. 14431. Excise tax on certain vaccines made permanent.
Sec. 14432. Continuation coverage under group health plans of costs of
pediatric vaccines.
Sec. 14433. Childhood Immunization Trust Fund.
Subtitle A--Training and Investment Incentives
PART I--PROVISIONS RELATING TO EDUCATION AND TRAINING
SEC. 14101. EMPLOYER-PROVIDED EDUCATIONAL ASSISTANCE.
(a) Permanent Extension of Exclusion.--
(1) In general.--Section 127 (relating to educational
assistance programs) is amended by striking subsection (d) and
by redesignating subsection (e) as subsection (d).
(2) Conforming amendment.--Paragraph (2) of section 103(a)
of the Tax Extension Act of 1991 is hereby repealed.
(b) Coordination With Section 132.--Paragraph (8) of section 132(i)
is amended to read as follows:
``(8) Application of section to otherwise taxable
educational or training benefits.--Amounts paid or expenses
incurred by the employer for education or training provided to
the employee which are not excludable from gross income under
section 127 shall be excluded from gross income under this
section if (and only if) such amounts or expenses are a working
condition fringe.''
(c) Effective Dates.--
(1) Subsection (a).--The amendments made by subsection (a)
shall apply to taxable years ending after June 30, 1992.
(2) Subsection (b).--The amendment made by subsection (b)
shall apply to taxable years beginning after December 31, 1988.
(d) Transition Rules.--
(1) Waiver of interest and penalties.--No interest,
penalty, or addition to tax shall be imposed or required to be
paid solely by reason of a failure, before the date of the
enactment of this Act, to treat educational assistance in a
manner consistent with the provisions of section 103(a) of the
Tax Extension Act of 1991 (as in effect before the amendments
made by subsection (a)).
(2) Special rules for 1992.--
(A) Employment taxes.--If--
(i) an employer provided an employee with
educational assistance during the period
beginning on July 1, 1992, and ending on
December 31, 1992,
(ii) consistent with the provisions of
section 103(a) of the Tax Extension Act of 1991
(as so in effect), such employer treated such
assistance as taxable for purposes of any
employment tax and as a result of such
treatment there was an increase in taxable
wages for purposes of such tax,
(iii) on or after the date of the enactment
of this Act and before January 1, 1994, such
employer pays such employee amounts which are
taxable wages for purposes of such tax and
which equal or exceed the increase referred to
in clause (ii), and
(iv) such employee did not treat such
assistance for purposes of such employment tax
(or for purposes of chapter 1 of the Internal
Revenue Code of 1986 in the case of employment
tax imposed by chapter 24 of such Code) in a
manner inconsistent with the employer's
treatment of such assistance,
the amendments made by subsection (a) shall not apply
to such educational assistance for purposes of such
employment tax, but, for purposes of applying such
employment tax (and for purposes of the reporting
requirements imposed by chapter 61 of such Code), the
taxable wages of the employee referred to in clause
(iii) shall be reduced by the amount of the increase
referred to in clause (ii). For purposes of clause
(iv), an employer may assume that the employee treated
the assistance in a manner consistent with the
employer's treatment unless such employer has actual
knowledge to the contrary.
(B) Reporting requirement.--An employer shall
separately report the amounts of any reduction under
subparagraph (A) as nontaxable income on any returns or
receipts required under chapter 61 of such Code for
calendar year 1993.
(C) Definitions.--For purposes of this paragraph--
(i) Employment tax.--The term ``employment
tax'' means any tax imposed by subtitle C of
such Code.
(ii) Taxable wages.--The term ``taxable
wages''means--
(I) wages (as defined in section
3121(a) of such Code) in the case of
the taxes imposed by chapter 21 of such
Code,
(II) compensation (as defined in
section 3231(e) of such Code) in the
case of the taxes imposed by chapter 22
of such Code,
(III) wages (as defined in section
3306(b) of such Code) in the case of
the taxes imposed by chapter 23 of such
Code, and
(IV) wages (as defined in section
3401(a) of such Code) in the case of
the taxes imposed by chapter 24 of such
Code.
(3) Income tax treatment.--If--
(A) subparagraph (A) of paragraph (2) applies to
any educational assistance referred to in such
paragraph provided to any employee, and
(B) such employee included such assistance in his
taxable income for purposes of the tax imposed by
chapter 1 of such Code,
the amendments made by subsection (a) shall not apply to such
assistance for purposes of such chapter 1, but the amount
included in the gross income of such employee by reason of
wages received from the employer referred to in subparagraph
(A) of paragraph (2) during 1993 shall be reduced in the manner
provided in such subparagraph (A).
SEC. 14102. TARGETED JOBS CREDIT.
(a) Permanent Extension of Credit.--
(1) In general.--Subsection (c) of section 51 (relating to
amount of targeted jobs credit) is amended by striking
paragraph (4).
(2) Effective date.--The amendment made by paragraph (1)
shall apply to individuals who begin work for the employer
after June 30, 1992.
(b) Credit for Participants in Approved School-To-Work Programs.--
(1) In general.--Subparagraph (I) of section 51(d)(1)
(defining members of targeted group) is amended to read as
follows:
``(I) a qualified participant in an
approved school-to-work program, or''.
(2) Qualified participant in an approved school-to-work
program.--Paragraph (10) of section 51(d) is amended to read as
follows:
``(10) Qualified participant in an approved school-to-work
program defined.--
``(A) In general.--Except as otherwise provided in
this paragraph, the term `qualified participant in an
approved school-to-work program' means any individual
who is certified under an approved school-to-work
program as--
``(i) having attained age 16 but not having
attained age 21, and
``(ii) being enrolled in and making
satisfactory progress in completing such
approved school-to-work program.
``(B) Limitation on number of participants.--
``(i) In general.--Any individual who
begins work for the employer during any
calendar year shall not be treated as a
qualified participant in an approved school-to-
work program unless the individual is certified
under such program as an eligible participant
with respect to such calendar year.
``(ii) Limitation on certifications.--The
aggregate number of individuals certified under
an approved school-to-work program as eligible
participants with respect to any calendar year
shall not exceed the portion of the national
school-to-work program limitation for such
calendar year allocated under subsection (l) to
such program.
``(C) Approved school-to-work program.--The term
`approved school-to-work program' means any program
which--
``(i) is a planned program of structured
job training designed to integrate academic
instruction provided by an educational
institution and work-based learning provided by
an employer, and
``(ii) is approved by the Secretaries of
Labor and Education.
``(D) Limitation on amount of wages taken into
account.--For purposes of applying this subpart to
wages paid or incurred to any qualified participant in
an approved school-to-work program, subsection (b)(3)
shall be applied by substituting `$3,000' for `$6,000'.
``(E) Wages.--In the case of remuneration
attributable to services performed while the individual
meets the requirements of subparagraph (A), wages, and
unemployment insurance wages, shall be determined
without regard to section 3306(c)(10)(C).''
(3) Overall limitations.--Section 51 is amended by adding
at the end thereof the following new subsection:
``(l) Overall Limitation on Approved School-To-Work Program
Participants.--
``(1) In general.--For purposes of subsection (d)(10), the
national school-to-work program limitation--
``(A) for calendar year 1994 is 125,000,
``(B) for calendar year 1995 is 140,000,
``(C) for calendar year 1996 is 160,000,
``(D) for calendar year 1997 is 180,000, and
``(E) for calendar year 1998 and any subsequent
calendar year is 200,000.
``(2) Allocation to states.--The national school-to-work
program limitation for any calendar year shall be allocated
among the States in proportion to the number of their eligible
participants that are estimated to be served in approved
school-to-work programs for that year. Such estimates shall be
published by the Secretaries of Labor and Education before the
beginning of the calendar year to which the allocation applies.
``(3) Allocation to approved school-to-work programs.--The
portion of the national school-to-work program limitation for
any calendar year which is allocated to any State shall be
allocated among the approved school-to-work programs in such
State in such manner as the Secretaries of Labor and Education
shall prescribe.''
(4) Effective date.--The amendments made by this subsection
shall apply in the case of individuals who begin work for the
employer after December 31, 1993.
PART II--INVESTMENT INCENTIVES
Subpart A--Research Credit
SEC. 14111. PERMANENT EXTENSION OF RESEARCH CREDIT.
(a) In General.--Section 41 (relating to credit for increasing
research activities) is amended by striking subsection (h).
(b) Conforming Amendment.--Paragraph (1) of section 28(b) is
amended by striking subparagraph (D).
(c) Effective Date.--The amendments made by this section shall
apply to taxable years ending after June 30, 1992.
SEC. 14112. MODIFICATION OF FIXED BASE PERCENTAGE FOR STARTUP
COMPANIES.
(a) General Rule.--Clause (ii) of section 41(c)(3)(B) is amended to
read as follows:
``(ii) Fixed-base percentage.--In a case to
which this subparagraph applies, the fixed-base
percentage is--
``(I) 3 percent for each of the
taxpayer's 1st 5 taxable years
beginning after December 31, 1993, for
which the taxpayer has qualified
research expenses,
``(II) in the case of the
taxpayer's 6th such taxable year, 1/6
of the percentage which the aggregate
qualified research expenses of the
taxpayer for the 4th and 5th such
taxable years is of the aggregate gross
receipts of the taxpayer for such
years,
``(III) in the case of the
taxpayer's 7th such taxable year, 1/3
of the percentage which the aggregate
qualified research expenses of the
taxpayer for the 5th and 6th such
taxable years is of the aggregate gross
receipts of the taxpayer for such
years,
``(IV) in the case of the
taxpayer's 8th such taxable year, 1/2
of the percentage which the aggregate
qualified research expenses of the
taxpayer for the 5th, 6th, and 7th such
taxable years is of the aggregate gross
receipts of the taxpayer for such
years,
``(V) in the case of the taxpayer's
9th such taxable year, 2/3 of the
percentage which the aggregate
qualified research expenses of the
taxpayer for the 5th, 6th, 7th, and 8th
such taxable years is of the aggregate
gross receipts of the taxpayer for such
years,
``(VI) in the case of the
taxpayer's 10th such taxable year, 5/6
of the percentage which the aggregate
qualified research expenses of the
taxpayer for the 5th, 6th, 7th, 8th,
and 9th such taxable years is of the
aggregate gross receipts of the
taxpayer for such years, and
``(VII) for taxable years
thereafter, the percentage which the
aggregate qualified research expenses
for any 5 taxable years selected by the
taxpayer from among the 5th through the
10th such taxable years is of the
aggregate gross receipts of the
taxpayer for such selected years.''.
(b) Conforming Amendments.--
(1) Clause (iii) of section 41(c)(3)(B) is amended by
striking ``clause (i)'' and inserting ``clauses (i) and (ii)''.
(2) Subparagraph (D) of section 41(c)(3) is amended by
striking ``subparagraph (A)'' and inserting ``subparagraphs (A)
and (B)(ii)''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
Subpart B--Capital Gain Provisions
SEC. 14113. 50-PERCENT EXCLUSION FOR GAIN FROM CERTAIN SMALL BUSINESS
STOCK.
(a) General Rule.--Part I of subchapter P of chapter 1 (relating to
capital gains and losses) is amended by adding at the end thereof the
following new section:
``SEC. 1202. 50-PERCENT EXCLUSION FOR GAIN FROM CERTAIN SMALL BUSINESS
STOCK.
``(a) 50-Percent Exclusion.--In the case of a taxpayer other than a
corporation, gross income shall not include 50 percent of any gain from
the sale or exchange of qualified small business stock held for more
than 5 years.
``(b) Per-Issuer Limitation on Taxpayer's Eligible Gain.--
``(1) In general.--If the taxpayer has eligible gain for
the taxable year from 1 or more dispositions of stock issued by
any corporation, the aggregate amount of such gain from
dispositions of stock issued by such corporation which may be
taken into account under subsection (a) for the taxable year
shall not exceed the greater of--
``(A) $10,000,000 reduced by the aggregate amount
of eligible gain taken into account under subsection
(a) for prior taxable years and attributable to
dispositions of stock issued by such corporation, or
``(B) 10 times the aggregate adjusted bases of
qualified small business stock issued by such
corporation and disposed of by the taxpayer during the
taxable year.
For purposes of subparagraph (B), the adjusted basis of any
stock shall be determined without regard to any addition to
basis after the date on which such stock was originally issued.
``(2) Eligible gain.--For purposes of this subsection, the
term `eligible gain' means any gain from the sale or exchange
of qualified small business stock held for more than 5 years.
``(3) Treatment of married individuals.--
``(A) Separate returns.--In the case of a separate
return by a married individual, paragraph (1)(A) shall
be applied by substituting `$5,000,000' for
`$10,000,000'.
``(B) Allocation of exclusion.--In the case of any
joint return, the amount of gain taken into account
under subsection (a) shall be allocated equally between
the spouses for purposes of applying this subsection to
subsequent taxable years.
``(C) Marital status.--For purposes of this
subsection, marital status shall be determined under
section 7703.
``(c) Qualified Small Business Stock.--For purposes of this
section--
``(1) In general.--Except as otherwise provided in this
section, the term `qualified small business stock' means any
stock in a C corporation which is originally issued after
December 31, 1992, if--
``(A) as of the date of issuance, such corporation
is a qualified small business, and
``(B) except as provided in subsections (f) and
(h), such stock is acquired by the taxpayer at its
original issue (directly or through an underwriter)--
``(i) in exchange for money or other
property (not including stock), or
``(ii) as compensation for services
provided to such corporation (other than
services performed as an underwriter of such
stock).
``(2) Active business requirement; etc.--
``(A) In general.--Stock in a corporation shall not
be treated as qualified small business stock unless,
during substantially all of the taxpayer's holding
period for such stock, such corporation meets the
active business requirements of subsection (e) and such
corporation is a C corporation.
``(B) Special rule for certain small business
investment companies.--
``(i) Waiver of active business
requirement.--Notwithstanding any provision of
subsection (e), a corporation shall be treated
as meeting the active business requirements of
such subsection for any period during which
such corporation qualifies as a specialized
small business investment company.
``(ii) Specialized small business
investment company.--For purposes of clause
(i), the term `specialized small business
investment company' means any eligible
corporation (as defined in subsection (e)(4))
which is licensed to operate under section
301(d) of the Small Business Investment Act of
1958 (as in effect on May 13, 1993).
``(3) Certain purchases by corporation of its own stock.--
``(A) Redemptions from taxpayer or related
person.--Stock acquired by the taxpayer shall not be
treated as qualified small business stock if, at any
time during the 4-year period beginning on the date 2
years before the issuance of such stock, the
corporation issuing such stock purchased (directly or
indirectly) any of its stock from the taxpayer or from
a person related (within the meaning of section 267(b)
or 707(b)) to the taxpayer.
``(B) Significant redemptions.--Stock issued by a
corporation shall not be treated as qualified business
stock if, during the 2-year period beginning on the
date 1 year before the issuance of such stock, such
corporation made 1 or more purchases of its stock with
an aggregate value (as of the time of the respective
purchases) exceeding 5 percent of the aggregate value
of all of its stock as of the beginning of such 2-year
period.
``(C) Acquisitions by related persons.--For
purposes of this paragraph, the purchase by any person
related (within the meaning of section 267(b) or
707(b)) to the issuing corporation of any stock in the
issuing corporation shall be treated as a purchase by
the issuing corporation.
``(d) Qualified Small Business.--For purposes of this section--
``(1) In general.--The term `qualified small business'
means any domestic corporation which is a C corporation if--
``(A) the aggregate capitalization of such
corporation (or any predecessor thereof) at all times
on or after January 1, 1993, and before the issuance
did not exceed $50,000,000,
``(B) the aggregate capitalization of such
corporation immediately after the issuance (determined
by taking into account amounts received in the
issuance) does not exceed $50,000,000, and
``(C) such corporation agrees to submit such
reports to the Secretary and to shareholders as the
Secretary may require to carry out the purposes of this
section.
``(2) Aggregate capitalization.--For purposes of paragraph
(1), the term `aggregate capitalization' means the excess of--
``(A) the amount of cash and the aggregate adjusted
bases of other property held by the corporation, over
``(B) the aggregate amount of the short-term
indebtedness of the corporation.
For purposes of the preceding sentence, the term `short-term
indebtedness' means any indebtedness which, when incurred, did
not have a term in excess of 1 year.
``(3) Look-thru in case of subsidiaries.--In determining
whether a corporation meets the requirements of this
subsection--
``(A) stock and debt of any subsidiary (as defined
in subsection (e)(5)(C)) held by such corporation shall
be disregarded, and
``(B) such corporation shall be treated as holding
its ratable share of the assets of such subsidiary and
as being liable for its ratable share of the
indebtedness of such subsidiary.
``(e) Active Business Requirement.--
``(1) In general.--For purposes of subsection (c)(2), the
requirements of this subsection are met by a corporation for
any period if during such period--
``(A) at least 80 percent (by value) of the assets
of such corporation are used by such corporation in the
active conduct of a qualified trade or business, and
``(B) such corporation is an eligible corporation.
``(2) Special rule for certain activities.--For purposes of
paragraph (1), if, in connection with any future qualified
trade or business, a corporation is engaged in--
``(A) start-up activities described in section
195(c)(1)(A),
``(B) activities resulting in the payment or
incurring of expenditures which may be treated as
research and experimental expenditures under section
174, or
``(C) activities with respect to in-house research
expenses described in section 41(b)(4),
assets used in such activities shall be treated as used in the
active conduct of a qualified trade or business. Any
determination under this paragraph shall be made without regard
to whether a corporation has any gross income from such
activities at the time of the determination.
``(3) Qualified trade or business.--For purposes of this
subsection, the term `qualified trade or business' means any
trade or business other than--
``(A) any trade or business involving the
performance of services in the fields of health, law,
engineering, architecture, accounting, actuarial
science, performing arts, consulting, athletics,
financial services, brokerage services, or any other
trade or business where the principal asset of such
trade or business is the reputation or skill of 1 or
more of its employees,
``(B) any banking, insurance, financing, leasing,
investing, or similar business,
``(C) any farming business (including the business
of raising or harvesting trees),
``(D) any business involving the production or
extraction of products of a character with respect to
which a deduction is allowable under section 613 or
613A, and
``(E) any business of operating a hotel, motel,
restaurant, or similar business.
``(4) Eligible corporation.--For purposes of this
subsection, the term `eligible corporation' means any domestic
corporation; except that such term shall not include--
``(A) a DISC or former DISC,
``(B) a corporation with respect to which an
election under section 936 is in effect,
``(C) a regulated investment company, real estate
investment trust, or REMIC, and
``(D) a cooperative.
``(5) Stock in other corporations.--
``(A) Look-thru in case of subsidiaries.--For
purposes of this subsection, stock and debt in any
subsidiary corporation shall be disregarded and the
parent corporation shall be deemed to own its ratable
share of the subsidiary's assets, and to conduct its
ratable share of the subsidiary's activities.
``(B) Portfolio stock or securities.--A corporation
shall be treated as failing to meet the requirements of
paragraph (1) for any period during which more than 10
percent of the value of its assets (in excess of
liabilities) consists of stock or securities in other
corporations which are not subsidiaries of such
corporation (other than assets described in paragraph
(6)).
``(C) Subsidiary.--For purposes of this paragraph,
a corporation shall be considered a subsidiary if the
parent owns more than 50 percent of the combined voting
power of all classes of stock entitled to vote, or more
than 50 percent in value of all outstanding stock, of
such corporation.
``(6) Working capital.--For purposes of paragraph (1)(A),
any assets which--
``(A) are held as a part of the reasonably required
working capital needs of a qualified trade or business
of the corporation, or
``(B) are held for investment and are reasonably
expected to be used within 2 years to finance future
research and experimentation in a qualified trade or
business or increases in working capital needs of a
qualified trade or business,
shall be treated as used in the active conduct of a qualified
trade or business. For periods after the corporation has been
in existence for at least 2 years, in no event may more than 50
percent of the assets of the corporation qualify as used in the
active conduct of a qualified trade or business by reason of
this paragraph.
``(7) Maximum real estate holdings.--A corporation shall
not be treated as meeting the requirements of paragraph (1) for
any period during which more than 10 percent of the total value
of its assets consists of real property which is not used in
the active conduct of a qualified trade or business. For
purposes of the preceding sentence, the ownership of, dealing
in, or renting of real property shall not be treated as the
active conduct of a qualified trade or business.
``(8) Computer software royalties.--For purposes of
paragraph (1), rights to computer software which produces
active business computer software royalties (within the meaning
of section 543(d)(1)) shall be treated as an asset used in the
active conduct of a trade or business.
``(f) Stock Acquired on Conversion of Preferred Stock.--If any
stock in a corporation is acquired solely through the conversion of
other stock in such corporation which is qualified small business stock
in the hands of the taxpayer--
``(1) the stock so acquired shall be treated as qualified
small business stock in the hands of the taxpayer, and
``(2) the stock so acquired shall be treated as having been
held during the period during which the converted stock was
held.
``(g) Treatment of Pass-Thru Entities.--
``(1) In general.--If any amount included in gross income
by reason of holding an interest in a pass-thru entity meets
the requirements of paragraph (2)--
``(A) such amount shall be treated as gain
described in subsection (a), and
``(B) for purposes of applying subsection (b), such
amount shall be treated as gain from a disposition of
stock in the corporation issuing the stock disposed of
by the pass-thru entity and the taxpayer's
proportionate share of the adjusted basis of the pass-
thru entity in such stock shall be taken into account.
``(2) Requirements.--An amount meets the requirements of
this paragraph if--
``(A) such amount is attributable to gain on the
sale or exchange by the pass-thru entity of stock which
is qualified small business stock in the hands of such
entity (determined by treating such entity as an
individual) and which was held by such entity for more
than 5 years, and
``(B) such amount is includible in the gross income
of the taxpayer by reason of the holding of an interest
in such entity which was held by the taxpayer on the
date on which such pass-thru entity acquired such stock
and at all times thereafter before the disposition of
such stock by such pass-thru entity.
``(3) Limitation based on interest originally held by
taxpayer.--Paragraph (1) shall not apply to any amount to the
extent such amount exceeds the amount to which paragraph (1)
would have applied if such amount were determined by reference
to the interest the taxpayer held in the pass-thru entity on
the date the qualified small business stock was acquired.
``(4) Pass-thru entity.--For purposes of this subsection,
the term `pass-thru entity' means--
``(A) any partnership,
``(B) any S corporation,
``(C) any regulated investment company, and
``(D) any common trust fund.
``(h) Certain Tax-Free and Other Transfers.--For purposes of this
section--
``(1) In general.--In the case of a transfer described in
paragraph (2), the transferee shall be treated as--
``(A) having acquired such stock in the same manner
as the transferor, and
``(B) having held such stock during any continuous
period immediately preceding the transfer during which
it was held (or treated as held under this subsection)
by the transferor.
``(2) Description of transfers.--A transfer is described in
this subsection if such transfer is--
``(A) by gift,
``(B) at death, or
``(C) from a partnership to a partner of stock with
respect to which requirements similar to the
requirements of subsection (g) are met at the time of
the transfer (without regard to the 5-year holding
period requirement).
``(3) Certain rules made applicable.--Rules similar to the
rules of section 1244(d)(2) shall apply for purposes of this
section.
``(4) Incorporations and reorganizations involving
nonqualified stock.--
``(A) In general.--In the case of a transaction
described in section 351 or a reorganization described
in section 368, if qualified small business stock is
exchanged for other stock which would not qualify as
qualified small business stock but for this
subparagraph, such other stock shall be treated as
qualified small business stock acquired on the date on
which the exchanged stock was acquired.
``(B) Limitation.--This section shall apply to gain
from the sale or exchange of stock treated as qualified
small business stock by reason of subparagraph (A) only
to the extent of the gain which would have been
recognized at the time of the transfer described in
subparagraph (A) if section 351 or 368 had not applied
at such time.
``(C) Successive application.--For purposes of this
paragraph, stock treated as qualified small business
stock under subparagraph (A) shall be so treated for
subsequent transactions or reorganizations, except that
the limitation of subparagraph (B) shall be applied as
of the time of the first transfer to which subparagraph
(A) applied.
``(D) Control test.--Except in the case of a
transaction described in section 368, this paragraph
shall apply only if, immediately after the transaction,
the corporation issuing the stock owns directly or
indirectly stock representing control (within the
meaning of section 368(c)) of the corporation whose
stock was exchanged.
``(i) Basis Rules.--For purposes of this section--
``(1) Stock exchanged for property.--In the case where the
taxpayer transfers property (other than money or stock) to a
corporation in exchange for stock in such corporation--
``(A) such stock shall be treated as having been
acquired by the taxpayer on the date of such exchange,
and
``(B) the basis of such stock in the hands of the
taxpayer shall in no event be less than the fair market
value of the property exchanged.
``(2) Treatment of contributions to capital.--If the
adjusted basis of any qualified small business stock is
adjusted by reason of any contribution to capital after the
date on which such stock was originally issued, in determining
the amount of the adjustment by reason of such contribution,
the basis of the contributed property shall in no event be
treated as less than its fair market value on the date of the
contribution.
``(j) Treatment of Certain Short Positions.--
``(1) In general.--If the taxpayer has an offsetting short
position with respect to any qualified small business stock,
subsection (a) shall not apply to any gain from the sale or
exchange of such stock unless--
``(A) such stock was held by the taxpayer for more
than 5 years as of the first day on which there was
such a short position, and
``(B) the taxpayer elects to recognize gain as if
such stock were sold on such first day for its fair
market value.
``(2) Offsetting short position.--For purposes of paragraph
(1), the taxpayer shall be treated as having an offsetting
short position with respect to any qualified small business
stock if--
``(A) the taxpayer has made a short sale of
substantially identical property,
``(B) the taxpayer has acquired an option to sell
substantially identical property at a fixed price, or
``(C) to the extent provided in regulations, the
taxpayer has entered into any other transaction which
substantially reduces the risk of loss from holding
such qualified small business stock.
For purposes of the preceding sentence, any reference to the
taxpayer shall be treated as including a reference to any
person who is related (within the meaning of section 267(b) or
707(b)) to the taxpayer.
``(k) Regulations.--The Secretary shall prescribe such regulations
as may be appropriate to carry out the purposes of this section,
including regulations to prevent the avoidance of the purposes of this
section through split-ups, shell corporations, partnerships, or
otherwise.''
(b) One-Half of Exclusion Treated as Preference for Minimum Tax.--
(1) In general.--Subsection (a) of section 57 (relating to
items of tax preference) is amended by adding at the end
thereof the following new paragraph:
``(8) Exclusion for gains on sale of certain small business
stock.--An amount equal to one-half of the amount excluded from
gross income for the taxable year under section 1202.''
(2) Conforming amendment.--Subclause (II) of section
53(d)(1)(B)(ii) is amended by striking ``and (6)'' and
inserting ``(6), and (8)''.
(c) Penalty for Failure To Comply With Reporting Requirements.--
Section 6652 is amended by inserting before the last subsection thereof
the following new subsection:
``(k) Failure To Make Reports Required Under Section 1202.--In the
case of a failure to make a report required under section 1202(d)(1)(C)
which contains the information required by such section on the date
prescribed therefor (determined with regard to any extension of time
for filing), there shall be paid (on notice and demand by the Secretary
and in the same manner as tax) by the person failing to make such
report, an amount equal to $50 for each report with respect to which
there was such a failure. In the case of any failure due to negligence
or intentional disregard, the preceding sentence shall be applied by
substituting `$100' for `$50'. In the case of a report covering periods
in 2 or more years, the penalty determined under preceding provisions
of this subsection shall be multiplied by the number of such years.''
(d) Conforming Amendments.--
(1)(A) Section 172(d)(2) (relating to modifications with
respect to net operating loss deduction) is amended to read as
follows:
``(2) Capital gains and losses of taxpayers other than
corporations.--In the case of a taxpayer other than a
corporation--
``(A) the amount deductible on account of losses
from sales or exchanges of capital assets shall not
exceed the amount includable on account of gains from
sales or exchanges of capital assets; and
``(B) the exclusion provided by section 1202 shall
not be allowed.''
(B) Subparagraph (B) of section 172(d)(4) is amended by
inserting ``, (2)(B),'' after ``paragraph (1)''.
(2) Paragraph (4) of section 642(c) is amended to read as
follows:
``(4) Adjustments.--To the extent that the amount otherwise
allowable as a deduction under this subsection consists of gain
described in section 1202(a), proper adjustment shall be made
for any exclusion allowable to the estate or trust under
section 1202. In the case of a trust, the deduction allowed by
this subsection shall be subject to section 681 (relating to
unrelated business income).''
(3) Paragraph (3) of section 643(a) is amended by adding at
the end thereof the following new sentence: ``The exclusion
under section 1202 shall not be taken into account.''.
(4) Paragraph (4) of section 691(c) is amended by striking
``1201, and 1211'' and inserting ``1201, 1202, and 1211''.
(5) The second sentence of paragraph (2) of section 871(a)
is amended by inserting ``such gains and losses shall be
determined without regard to section 1202 and'' after ``except
that''.
(6) The table of sections for part I of subchapter P of
chapter 1 is amended by adding after the item relating to
section 1201 the following new item:
``Sec. 1202. 50-percent exclusion for
gain from certain small
business stock.''
(e) Effective Date.--The amendments made by this section shall
apply to stock issued after December 31, 1992.
SEC. 14114. ROLLOVER OF GAIN FROM SALE OF PUBLICLY TRADED SECURITIES
INTO SPECIALIZED SMALL BUSINESS INVESTMENT COMPANIES.
(a) In General.--Part III of subchapter O of chapter 1 (relating to
common nontaxable exchanges) is amended by adding at the end the
following new section:
``SEC. 1044. ROLLOVER OF PUBLICLY TRADED SECURITIES GAIN INTO
SPECIALIZED SMALL BUSINESS INVESTMENT COMPANIES.
``(a) Nonrecognition of Gain.--In the case of the sale of any
publicly traded securities with respect to which the taxpayer elects
the application of this section, gain from such sale shall be
recognized only to the extent that the amount realized on such sale
exceeds--
``(1) the cost of any common stock or partnership interest
in a specialized small business investment company purchased by
the taxpayer during the 60-day period beginning on the date of
such sale, reduced by
``(2) any portion of such cost previously taken into
account under this section.
This section shall not apply to any gain which is treated as ordinary
income for purposes of this subtitle.
``(b) Limitations.--
``(1) Limitation on individuals.--In the case of an
individual, the amount of gain which may be excluded under
subsection (a) for any taxable year shall not exceed the lesser
of--
``(A) $50,000, or
``(B) $500,000, reduced by the amount of gain
excluded under subsection (a) for all preceding taxable
years.
``(2) Limitation on c corporations.--In the case of a C
corporation, the amount of gain which may be excluded under
subsection (a) for any taxable year shall not exceed the lesser
of--
``(A) $250,000, or
``(B) $1,000,000, reduced by the amount of gain
excluded under subsection (a) for all preceding taxable
years.
``(3) Special rules for married individuals.--For purposes
of this subsection--
``(A) Separate returns.--In the case of a separate
return by a married individual, paragraph (1) shall be
applied by substituting `$25,000' for `$50,000' and
`$250,000' for `$500,000'.
``(B) Allocation of gain.--In the case of any joint
return, the amount of gain excluded under subsection
(a) for any taxable year shall be allocated equally
between the spouses for purposes of applying this
subsection to subsequent taxable years.
``(C) Marital status.--For purposes of this
subsection, marital status shall be determined under
section 7703.
``(4) Special rules for c corporation.--For purposes of
this subsection--
``(A) all corporations which are members of the
same controlled group of corporations (within the
meaning of section 52(a)) shall be treated as 1
taxpayer, and
``(B) any gain excluded under subsection (a) by a
predecessor of any C corporation shall be treated as
having been excluded by such C corporation.
``(c) Definitions and Special Rules.--For purposes of this
section--
``(1) Publicly traded securities.--The term `publicly
traded securities' means securities which are traded on an
established securities market.
``(2) Purchase.--The term `purchase' has the meaning given
such term by section 1043(b)(4).
``(3) Specialized small business investment company.--The
term `specialized small business investment company' means any
partnership or corporation which is licensed by the Small
Business Administration under section 301(d) of the Small
Business Investment Act of 1958 (as in effect on May 13, 1993).
``(4) Certain entities not eligible.--This section shall
not apply to any estate, trust, partnership, or S corporation.
``(d) Basis Adjustments.--If gain from any sale is not recognized
by reason of subsection (a), such gain shall be applied to reduce (in
the order acquired) the basis for determining gain or loss of any
common stock or partnership interest in any specialized small business
investment company which is purchased by the taxpayer during the 60-day
period described in subsection (a). This subsection shall not apply for
purposes of section 1202.''
(b) Conforming Amendment.--Paragraph (24) of section 1016(a) is
amended--
(1) by striking ``section 1043'' and inserting ``section
1043 or 1044'', and
(2) by striking ``section 1043(c)'' and inserting ``section
1043(c) or 1044(d), as the case may be''.
(c) Clerical Amendment.--The table of sections for part III of
subchapter O of chapter 1 is amended by adding at the end the following
new item:
``Sec. 1044. Rollover of publicly traded
securities gain into
specialized small business
investment companies.''
(d) Effective Date.--The amendments made by this section shall
apply to sales on and after the date of the enactment of this Act, in
taxable years ending on and after such date.
Subpart C--Modifications To Minimum Tax Depreciation Rules
SEC. 14115. MODIFICATION TO MINIMUM TAX DEPRECIATION RULES.
(a) General Rule.--Paragraph (1) of section 56(a) (relating to
depreciation) is amended by redesignating subparagraphs (B), (C), and
(D) as subparagraphs (C), (D), and (E), respectively, and by inserting
after subparagraph (A) the following new subparagraph:
``(B) Treatment of certain personal property placed
in service after 1993.--
``(i) In general.--In the case of any
property to which this subparagraph applies,
the depreciation deduction allowable under
section 167 shall be determined as provided in
section 168(a), except that the method of
depreciation used shall be--
``(I) the 120 percent declining
balance method switching to the
straight line method for the 1st
taxable year for which using the
straight line method with respect to
the adjusted basis as of the beginning
of the year will yield a higher
allowance, or
``(II) the straight line method in
the case of property for which the
applicable depreciation method under
section 168(a) is the straight line
method.
``(ii) Property to which subparagraph
applies.--This subparagraph shall apply to any
tangible property placed in service after
December 31, 1993, except that this
subparagraph shall not apply to--
``(I) any residential rental
property or nonresidential real
property (within the meaning of section
168(e)), and
``(II) any other property for which
the depreciation deduction provided by
section 167(a) for purposes of the
regular tax is computed under the
alternative depreciation system of
section 168(g).
``(iii) Coordination with subparagraph
(a).--Subparagraph (A) shall not apply to any
property to which this subparagraph applies.''
(b) Elimination of ACE Depreciation Adjustment.--Clause (i) of
section 56(g)(4)(A) (relating to depreciation adjustments for computing
adjusted current earnings) is amended by adding at the end thereof the
following new sentence: ``The preceding sentence shall not apply to any
property to which subsection (a)(1)(B) applies, and the depreciation
deduction with respect to such property shall be determined under the
rules of subsection (a)(1)(B).''.
(c) Conforming Amendments.--
(1) Paragraph (2) of section 168(b) is amended to read as
follows:
``(2) Special rule for declining balance method in certain
cases.--
``(A) 150 percent method for certain property.--
Paragraph (1) shall be applied by substituting `150
percent' for `200 percent' in the case of--
``(i) any 15-year or 20-year property, or
``(ii) any property used in a farming
business (within the meaning of section
263A(e)(4)).
``(B) Election to use minimum tax method.--In the
case of any property (other than property described in
paragraph (3)) with respect to which the taxpayer
elects under paragraph (5) to have the provisions of
this subparagraph apply, paragraph (1) shall be applied
by substituting `120 percent' for `200 percent' (and
subparagraph (A) of this paragraph shall not apply).''
(2) Paragraph (5) of section 168(b) is amended by striking
``paragraph (2)(C)'' and inserting ``paragraph (2)(B)''.
(3) Subsection (c) of section 168 is amended--
(A) by striking paragraph (2), and
(B) by striking so much of such subsection as
precedes the table contained in paragraph (1) and
inserting the following:
``(c) Applicable Recovery Period.--For purposes of this section,
the applicable recovery period shall be determined in accordance with
the following table:''.
(d) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to property placed
in service after December 31, 1993.
(2) Coordination with transitional rules.--The amendments
made by this section shall not apply to any property to which
paragraph (1) of section 56(a) of the Internal Revenue Code of
1986 does not apply by reason of subparagraph (D)(i) thereof
(as redesignated by subsection (a) of this section).
Subpart D--Increase in Expense Treatment for Small Businesses
SEC. 14116. INCREASE IN EXPENSE TREATMENT FOR SMALL BUSINESSES.
(a) General Rule.--Paragraph (1) of section 179(b) (relating to
dollar limitation) is amended by striking ``$10,000'' and inserting
``$25,000''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to taxable years beginning after December 31, 1992.
PART III--TAX-EXEMPT BOND PROVISIONS
SEC. 14121. HIGH-SPEED INTERCITY RAIL FACILITY BONDS EXEMPT FROM STATE
VOLUME CAP.
(a) In General.--Paragraph (4) of section 146(g) (relating to
exemption for certain bonds) is amended by striking ``75 percent of''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to bonds issued after December 31, 1993.
SEC. 14122. PERMANENT EXTENSION OF QUALIFIED SMALL ISSUE BONDS.
(a) In General.--Subparagraph (B) of section 144(a)(12) is amended
to read as follows:
``(B) Bonds issued to finance manufacturing
facilities and farm property.--Subparagraph (A)
shall not apply to any bond issued as part of
an issue 95 percent or more of the net proceeds
of which are to be used to provide--
``(i) any manufacturing facility, or
``(ii) any land or property in accordance
with section 147(c)(2).''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to bonds issued after June 30, 1992.
PART IV--EXPANSION AND SIMPLIFICATION OF EARNED INCOME TAX CREDIT
SEC. 14131. EXPANSION AND SIMPLIFICATION OF EARNED INCOME TAX CREDIT.
(a) General Rule.--Section 32 (relating to earned income credit) is
amended by striking subsections (a) and (b) and inserting the
following:
``(a) Allowance of Credit.--
``(1) In general.--In the case of an eligible individual,
there shall be allowed as a credit against the tax imposed by
this subtitle for the taxable year an amount equal to the
credit percentage of so much of the taxpayer's earned income
for the taxable year as does not exceed the earned income
amount.
``(2) Limitation.--The amount of the credit allowable to a
taxpayer under paragraph (1) for any taxable year shall not
exceed the excess (if any) of--
``(A) the credit percentage of the earned income
amount, over
``(B) the phaseout percentage of so much of the
adjusted gross income (or, if greater, the earned
income) of the taxpayer for the taxable year as exceeds
the phaseout amount.
``(b) Percentages and Amounts.--For purposes of subsection (a)--
``(1) Percentages.--The credit percentage and the phaseout
percentage shall be determined as follows:
``(A) In general.--In the case of taxable years
beginning after 1994:
In the case of an eligible
individual with: The credit percentage is: The phaseout percentage is:
1 qualifying child.......... 34.37........................... 16.16
2 or more qualifying
children................... 39.66........................... 19.83
No qualifying children...... 7.65............................ 7.65
``(B) Transitional percentages.--In the case of a
taxable year beginning in 1994:
In the case of an
eligible individual The credit percentage is: The phaseout percentage is:
with:
1 qualifying child...... 26.60........................... 16.16
2 or more qualifying
children............... 31.59........................... 15.79
No qualifying children.. 7.65............................ 7.65
``(2) Amounts.--The earned income amount and the phaseout
amount shall be determined as follows:
``(A) In general.--In the case of taxable years
beginning after 1994:
In the case of an eligible
individual with: The earned income amount is: The phaseout amount is:
1 qualifying child.......... $6,000.......................... $11,000
2 or more qualifying
children................... $8,500.......................... $11,000
No qualifying children...... $4,000.......................... $5,000
``(B) Transitional amounts.--In the case of a
taxable year beginning in 1994:
In the case of an
eligible individual The earned income amount is: The phaseout amount is:
with:
1 qualifying child...... $7,750.......................... $11,000
2 or more qualifying
children............... $8,500.......................... $11,000
No qualifying children.. $4,000.......................... $5,000''.
(b) Eligible Individual.--Subparagraph (A) of section 32(c)(1)
(defining eligible individual) is amended to read as follows:
``(A) In general.--The term `eligible individual'
means--
``(i) any individual who has a qualifying
child for the taxable year, or
``(ii) any other individual who does not
have a qualifying child for the taxable year,
if--
``(I) such individual's principal
place of abode is in the United States
for more than one-half of such taxable
year,
``(II) such individual (or, if the
individual is married, the individual's
spouse) has attained age 22 before the
close of the taxable year, and
``(III) such individual (or, if the
individual is married, the individual's
spouse) is not a dependent for whom a
deduction is allowable under section
151 to another taxpayer for any taxable
year beginning in the same calendar
year as such taxable year.''
(c) Inflation Adjustments.--Section 32(i) (relating to inflation
adjustments) is amended--
(1) by striking paragraphs (1) and (2) and inserting the
following new paragraph:
``(1) In general.--In the case of any taxable year
beginning after 1994, each dollar amount contained in
subsection (b)(2)(A) shall be increased by an amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined
under section 1(f)(3), for the calendar year in which
the taxable year begins, by substituting `calendar year
1993' for `calendar year 1992'.'', and
(2) by redesignating paragraph (3) as paragraph (2).
(d) Conforming Amendments.--
(1) Subparagraph (D) of section 32(c)(3) is amended--
(A) by striking ``clause (i) or (ii)'' in clause
(iii) and inserting ``clause (i)'',
(B) by striking clause (ii), and
(C) by redesignating clause (iii) as clause (ii).
(2) Paragraph (3) of section 162(l) is amended to read as
follows:
``(3) Coordination with medical deduction.--Any amount paid
by a taxpayer for insurance to which paragraph (1) applies
shall not be taken into account in computing the amount
allowable to the taxpayer as a deduction under section
213(a).''
(3) Section 213 is amended by striking subsection (f).
(4) Subsection (b) of section 3507 is amended by
redesignating paragraphs (2) and (3) as paragraphs (3) and (4),
respectively, and by inserting after paragraph (1) the
following new paragraph:
``(2) certifies that the employee has 1 or more qualifying
children (within the meaning of section 32(c)(3)) for such
taxable year,''.
(5) Subparagraph (B) of section 3507(c)(2) is amended by
striking clauses (i) and (ii) and inserting the following:
``(i) of not more than the credit
percentage in effect under section 32(b)(1) for
an eligible individual with 1 qualifying child
and with earned income not in excess of the
earned income amount in effect under section
32(b)(2) for such an eligible individual, which
``(ii) phases out at the phaseout
percentage in effect under section 32(b)(1) for
such an eligible individual between the
phaseout amount in effect under section
32(b)(2) for such an eligible individual and
the amount of earned income at which the credit
under section 32(a) phases out for such an
eligible individual, or''.
(e) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
PART V--INCENTIVES FOR INVESTMENT IN REAL ESTATE
Subpart A--Extension of Qualified Mortgage Bonds and Low-Income Housing
Credit
SEC. 14141. PERMANENT EXTENSION OF QUALIFIED MORTGAGE BONDS.
(a) In General.--Paragraph (1) of section 143(a) (defining
qualified mortgage bond) is amended to read as follows:
``(1) Qualified mortgage bond defined.--For purposes of
this title, the term `qualified mortgage bond' means a bond
which is issued as part of a qualified mortgage issue.''
(b) Mortgage Credit Certificates.--Section 25 is amended by
striking subsection (h) and by redesignating subsections (i) and (j) as
subsections (h) and (i), respectively.
(c) Effective Dates.--
(1) Bonds.--The amendment made by subsection (a) shall
apply to bonds issued after June 30, 1992.
(2) Certificates.--The amendment made by subsection (b)
shall apply to elections for periods after June 30, 1992.
SEC. 14142. PERMANENT EXTENSION OF LOW-INCOME HOUSING CREDIT.
(a) In General.--Section 42 (relating to low-income housing credit)
is amended by striking subsection (o).
(b) HOME Assistance Not To Result In Certain Buildings Being
Federally Subsidized.--Paragraph (2) of section 42(i) (relating to
determination of whether building is federally subsidized) is amended
by adding at the end thereof the following new subparagraph:
``(E) Buildings receiving home assistance.--
Assistance provided under the HOME Investment
Partnerships Act (as in effect on the date of the
enactment of this subparagraph) with respect to any
building shall not be taken under subparagraph (D) if
40 percent or more of the residential units in the
building are occupied by individuals whose income is 50
percent or less of area median gross income. Subsection
(d)(5)(C) shall not apply to any building to which the
preceding sentence applies.''.
(c) Effective Dates.--
(1) The amendment made by subsection (a) shall apply to
periods after June 30, 1992.
(2) The amendment made by subsection (b) shall apply to
periods after the date of the enactment of this Act.
Subpart B--Modification of Passive Loss Rules
SEC. 14143. APPLICATION OF PASSIVE LOSS RULES TO RENTAL REAL ESTATE
ACTIVITIES.
(a) Rental Real Estate Activities of Persons in Real Property
Business Not Automatically Treated as Passive Activities.--Subsection
(c) of section 469 (defining passive activity) is amended by adding at
the end thereof the following new paragraph:
``(7) Special rules for taxpayers in real property
business--
``(A) In general.--If this paragraph applies to any
taxpayer for a taxable year--
``(i) paragraph (2) shall not apply to any
rental real estate activity of such taxpayer
for such taxable year, and
``(ii) this section shall be applied as if
each interest of the taxpayer in rental real
estate were a separate activity.
Notwithstanding clause (ii), a taxpayer may elect to
treat all interests in rental real estate as one
activity. Nothing in the preceding provisions of this
subparagraph shall be construed as affecting the
determination of whether the taxpayer materially
participates with respect to any interest in a limited
partnership as a limited partner.
``(B) Taxpayers to whom paragraph applies.--This
paragraph shall apply to a taxpayer for a taxable year
if more than one-half of the personal services
performed in trades or businesses by the taxpayer
during such taxable year are performed in real property
trades or businesses in which the taxpayer materially
participates.
``(C) Real property trade or business.--For
purposes of this paragraph, the term `real property
trade or business' means any real property development,
redevelopment, construction, reconstruction,
acquisition, conversion, rental, operation, management,
leasing, or brokerage trade or business.
``(D) Special rules for subparagraph (b).--
``(i) Closely held c corporations.--In the
case of a closely held C corporation, the
requirements of subparagraph (B) shall be
treated as met for any taxable year if more
than 50 percent of the gross receipts of such
corporation for such taxable year are derived
from real property trades or businesses in
which the corporation materially participates.
``(ii) Personal services as an employee.--
For purposes of subparagraph (B), personal
services performed as an employee shall not be
treated as performed in real property trades or
businesses. The preceding sentence shall not
apply if such employee is a 5-percent owner (as
defined in section 416(i)(1)(B)) in the
employer.''
(b) Conforming Amendments.--
(1) Paragraph (2) of section 469(c) is amended by striking
``The'' and inserting ``Except as provided in paragraph (7),
the''.
(2) Clause (iv) of section 469(i)(3)(E) is amended by
inserting ``or any loss allowable by reason of subsection
(c)(7)'' after ``loss''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
Subpart C--Provisions Relating to Real Estate Investments by Pension
Funds
SEC. 14144. REAL ESTATE PROPERTY ACQUIRED BY A QUALIFIED ORGANIZATION.
(a) Modifications of Exceptions.--Paragraph (9) of section 514(c)
(relating to real property acquired by a qualified organization) is
amended by adding at the end thereof the following new subparagraphs:
``(G) Special rules for purposes of the
exceptions.--Except as otherwise provided by
regulations--
``(i) Small leases disregarded.--For
purposes of clauses (iii) and (iv) of
subparagraph (B), a lease to a person described
in such clause (iii) or (iv) shall be
disregarded if no more than 25 percent of the
leasable floor space in a building (or complex
of buildings) is covered by the lease and if
the lease is on commercially reasonable terms.
``(ii) Commercially reasonable financing.--
Clause (v) of subparagraph (B) shall not apply
if the financing is on commercially reasonable
terms.
``(H) Qualifying sales by financial institutions.--
``(i) In general.--In the case of a
qualifying sale by a financial institution,
except as provided in regulations, clauses (i)
and (ii) of subparagraph (B) shall not apply
with respect to financing provided by such
institution for such sale.
``(ii) Qualifying sale.--For purposes of
this clause, there is a qualifying sale by a
financial institution if--
``(I) a qualified organization
acquires property described in clause
(iii) from a financial institution and
any gain recognized by the financial
institution with respect to the
property is ordinary income,
``(II) the stated principal amount
of the financing provided by the
financial institution does not exceed
the amount of the outstanding
indebtedness (including accrued but
unpaid interest) of the financial
institution with respect to the
property described in clause (iii)
immediately before the acquisition
referred to in clause (iii) or (v),
whichever is applicable, and
``(III) the present value
(determined as of the time of the sale
and by using the applicable Federal
rate determined under section 1274(d))
of the maximum amount payable pursuant
to the financing that is determined by
reference to the revenue, income, or
profits derived from the property
cannot exceed 30 percent of the total
purchase price of the property
(including the contingent payments).
``(iii) Property to which subparagraph
applies.--Property is described in this clause
if such property is foreclosure property, or is
real property which--
``(I) was acquired by the qualified
organization from a financial
institution which is in conservatorship
or receivership, or from the
conservator or receiver of such an
institution, and
``(II) was held by the financial
institution at the time it entered into
conservatorship or receivership.
``(iv) Financial institution.--For purposes
of this subparagraph, the term `financial
institution' means--
``(I) any financial institution
described in section 581 or 591(a),
``(II) any other corporation which
is a direct or indirect subsidiary of
an institution referred to in subclause
(I) but only if, by virtue of being
affiliated with such institution, such
other corporation is subject to
supervision and examination by a
Federal or State agency which regulates
institutions referred to in subclause
(I), and
``(III) any person acting as a
conservator or receiver of an entity
referred to in subclause (I) or (II)
(or any government agency or
corporation succeeding to the rights or
interest of such person).
``(v) Foreclosure property.--For purposes
of this subparagraph, the term `foreclosure
property' means any real property acquired by
the financial institution as the result of
having bid on such property at foreclosure, or
by operation of an agreement or process of law,
after there was a default (or a default was
imminent) on indebtedness which such property
secured.''.
(b) Conforming Amendment.--Paragraph (9) of section 514(c) is
amended--
(1) by adding the following new sentence at the end of
subparagraph (A): ``For purposes of this paragraph, an interest
in a mortgage shall in no event be treated as real property.'',
and
(2) by striking the last sentence of subparagraph (B).
(c) Effective Dates.--
(1) In general.--The amendments made by this section shall
apply to acquisitions on or after January 1, 1994.
(2) Small leases.--The provisions of section
514(c)(9)(G)(i) of the Internal Revenue Code of 1986 shall, in
addition to any leases to which the provisions apply by reason
of paragraph (1), apply to leases entered into on or after
January 1, 1994.
SEC. 14145. REPEAL OF SPECIAL TREATMENT OF PUBLICLY TREATED
PARTNERSHIPS.
(a) General Rule.--Subsection (c) of section 512 is amended--
(1) by striking paragraph (2),
(2) by redesignating paragraph (3) as paragraph (2), and
(3) by striking ``paragraph (1) or (2)'' in paragraph (2)
(as so redesignated) and inserting ``paragraph (1)''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to partnership years beginning on or after January 1, 1994.
SEC. 14146. TITLE-HOLDING COMPANIES PERMITTED TO RECEIVE SMALL AMOUNTS
OF UNRELATED BUSINESS TAXABLE INCOME.
(a) General Rule.--Paragraph (25) of section 501(c) is amended by
adding at the end thereof the following new subparagraph:
``(G)(i) An organization shall not be treated as
failing to be described in this paragraph merely by
reason of the receipt of any otherwise disqualifying
income which is incidentally derived from the holding
of real property.
``(ii) Clause (i) shall not apply if the amount of
gross income described in such clause exceeds 10
percent of the organization's gross income for the
taxable year unless the organization establishes to the
satisfaction of the Secretary that the receipt of gross
income described in clause (i) in excess of such
limitation was inadvertent and reasonable steps are
being taken to correct the circumstances giving rise to
such income.''
(b) Conforming Amendment.--Paragraph (2) of section 501(c) is
amended by adding at the end thereof the following new sentence:
``Rules similar to the rules of subparagraph (G) of paragraph (25)
shall apply for purposes of this paragraph.''
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning on or after January 1, 1994.
SEC. 14147. EXCLUSION FROM UNRELATED BUSINESS TAX OF GAINS FROM CERTAIN
PROPERTY.
(a) General Rule.--Subsection (b) of section 512 (relating to
modifications) is amended by adding at the end thereof the following
new paragraph:
``(16)(A) Notwithstanding paragraph (5)(B), there shall be
excluded all gains or losses from the sale, exchange, or other
disposition of any real property described in subparagraph (B)
if--
``(i) such property was acquired by the
organization from--
``(I) a financial institution described in
section 581 or 591(a) which is in
conservatorship or receivership, or
``(II) the conservator or receiver of such
an institution (or any government agency or
corporation succeeding to the rights or
interests of the conservator or receiver),
``(ii) such property is designated by the
organization within the 9-month period beginning on the
date of its acquisition as property held for sale,
except that not more than one-half (by value determined
as of such date) of property acquired in a single
transaction may be so designated,
``(iii) such sale, exchange, or disposition occurs
before the later of--
``(I) the date which is 30 months after the
date of the acquisition of such property, or
``(II) the date specified by the Secretary
in order to assure an orderly disposition of
property held by persons described in
subparagraph (A), and
``(iv) while such property was held by the
organization, the aggregate expenditures on
improvements and development activities included in the
basis of the property are (or were) not in excess of 20
percent of the net selling price of such property.
``(B) Property is described in this subparagraph if it is
real property which--
``(i) was held by the financial institution at the
time it entered into conservatorship or receivership,
or
``(ii) was foreclosure property (as defined in
section 514(c)(9)(H)(v)) which secured indebtedness
held by the financial institution at such time.
For purposes of this subparagraph, real property includes an
interest in a mortgage.''
(b) Effective Date.--The amendment made by subsection (a) shall
apply to property acquired on or after January 1, 1994.
SEC. 14148. EXCLUSION FROM UNRELATED BUSINESS TAX OF CERTAIN FEES AND
OPTION PREMIUMS.
(a) Loan Commitment Fees.--Paragraph (1) of section 512(b)
(relating to modifications) is amended by inserting ``amounts received
or accrued as consideration for entering into agreements to make
loans,'' before ``and annuities''.
(b) Option Premiums.--The second sentence of section 512(b)(5) is
amended--
(1) by striking ``all gains on'' and inserting ``all gains
or losses recognized, in connection with the organization's
investment activities, from'',
(2) by striking ``, written by the organization in
connection with its investment activities,'' and
(3) by inserting ``or real property and all gains or losses
from the forfeiture of good-faith deposits (that are consistent
with established business practice) for the purchase, sale, or
lease of real property in connection with the organization's
investment activities'' before the period.
(c) Effective Date.--The amendments made by this section shall
apply to amounts received on or after January 1, 1994.
SEC. 14149. TREATMENT OF PENSION FUND INVESTMENTS IN REAL ESTATE
INVESTMENT TRUSTS.
(a) General Rule.--Subsection (h) of section 856 (relating to
closely held determinations) is amended by adding at the end thereof
the following new paragraph:
``(3) Treatment of trusts described in section 401(a).--
``(A) Look-thru treatment.--
``(i) In general.--Except as provided in
clause (ii), in determining whether the stock
ownership requirement of section 542(a)(2) is
met for purposes of paragraph (1)(A), any stock
held by a qualified trust shall be treated as
held directly by its beneficiaries in
proportion to their actuarial interests in such
trust and shall not be treated as held by such
trust.
``(ii) Certain related trusts not
eligible.--Clause (i) shall not apply to any
qualified trust if one or more disqualified
persons (as defined in section 4975(e)(2),
without regard to subparagraphs (B) and (I)
thereof) with respect to such qualified trust
hold in the aggregate 5 percent or more in
value of the interests in the real estate
investment trust and such real estate
investment trust has accumulated earnings and
profits attributable to any period for which it
did not qualify as a real estate investment
trust.
``(B) Coordination with personal holding company
rules.--If any entity qualifies as a real estate
investment trust for any taxable year by reason of
subparagraph (A), such entity shall not be treated as a
personal holding company for such taxable year for
purposes of part II of subchapter G of this chapter.
``(C) Treatment for purposes of unrelated business
tax.--If any qualified trust holds more than 10 percent
(by value) of the interests in any pension-held REIT at
any time during a taxable year, the trust shall be
treated as having for such taxable year gross income
from an unrelated trade or business in an amount which
bears the same ratio to the aggregate dividends paid
(or treated as paid) by the REIT to the trust for the
taxable year of the REIT with or within which the
taxable year of the trust ends (the `REIT year') as--
``(i) the gross income (less direct
expenses related thereto) of the REIT for the
REIT year from unrelated trades or businesses
(determined as if the REIT were a qualified
trust), bears to
``(ii) the gross income (less direct
expenses related thereto) of the REIT for the
REIT year.
This subparagraph shall apply only if the ratio
determined under the preceding sentence is at least 5
percent.
``(D) Pension-held reit.--The purposes of
subparagraph (C)--
``(i) In general.--A real estate investment
trust is a pension-held REIT if such trust
would not have qualified as a real estate
investment trust but for the provisions of this
paragraph and if such trust is predominantly
held by qualified trusts.
``(ii) Predominantly held.--For purposes of
clause (i), a real estate investment trust is
predominantly held by qualified trusts if--
``(I) at least 1 qualified trust
holds more than 25 percent (by value)
of the interests in such real estate
investment trust, or
``(II) 1 or more qualified trusts
(each of whom own more than 10 percent
by value of the interests in such real
estate investment trust) hold in the
aggregate more than 50 percent (by
value) of the interests in such real
estate investment trust.
``(E) Qualified trust.--For purposes of this
paragraph, the term `qualified trust' means any trust
described in section 401(a) and exempt from tax under
section 501(a).''
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 1993.
Subpart D--Discharge of Indebtedness
SEC. 14150. EXCLUSION FROM GROSS INCOME FOR INCOME FROM DISCHARGE OF
QUALIFIED REAL PROPERTY BUSINESS INDEBTEDNESS.
(a) In General.--Paragraph (1) of section 108(a) (relating to
income from discharge of indebtedness) is amended by striking ``or'' at
the end of subparagraph (B), by striking the period at the end of
subparagraph (C) and inserting ``, or'', and by adding at the end the
following new subparagraph:
``(D) in the case of a taxpayer other than a C corporation,
the indebtedness discharged is qualified real property business
indebtedness.''
(b) Qualified Real Property Business Indebtedness.--Section 108 is
amended by inserting after subsection (b) the following new subsection:
``(c) Treatment of Discharge of Qualified Real Property Business
Indebtedness.--
``(1) Basis reduction.--
``(A) In general.--The amount excluded from gross
income under subparagraph (D) of subsection (a)(1)
shall be applied to reduce the basis of the depreciable
real property of the taxpayer.
``(B) Cross reference.--For provisions making the
reduction described in subparagraph (A), see section
1017.
``(2) Limitations.--
``(A) Indebtedness in excess of value.--The amount
excluded under subparagraph (D) of subsection (a)(1)
with respect to any qualified real property business
indebtedness shall not exceed the excess (if any) of--
``(i) the outstanding principal amount of
such indebtedness (immediately before the
discharge), over
``(ii) the fair market value of the real
property described in paragraph (3)(A) (as of
such time), reduced by the outstanding
principal amount of any other qualified real
property business indebtedness secured by such
property (as of such time).
``(B) Overall limitation.--The amount excluded
under subparagraph (D) of subsection (a)(1) shall not
exceed the aggregate adjusted bases of depreciable real
property (determined after any reductions under
subsections (b) and (g)) held by the taxpayer
immediately before the discharge (other than
depreciable real property acquired in contemplation of
such discharge).
``(3) Qualified real property business indebtedness.--The
term `qualified real property business indebtedness' means
indebtedness which--
``(A) was incurred or assumed by the taxpayer in
connection with real property used in a trade or
business and is secured by such real property,
``(B) was incurred or assumed before January 1,
1993, or if incurred or assumed on or after such date,
is qualified acquisition indebtedness, and
``(C) with respect to which such taxpayer makes an
election to have this paragraph apply.
Such term shall not include qualified farm indebtedness.
Indebtedness under subparagraph (B) shall include indebtedness
resulting from the refinancing of indebtedness under
subparagraph (B) (or this sentence), but only to the extent it
does not exceed the amount of the indebtedness being
refinanced.
``(4) Qualified acquisition indebtedness.--For purposes of
paragraph (3)(B), the term `qualified acquisition indebtedness'
means, with respect to any real property described in paragraph
(3)(A), indebtedness incurred or assumed to acquire, construct,
reconstruct, or substantially improve such property.
``(5) Regulations.--The Secretary shall issue such
regulations as are necessary to carry out this subsection,
including regulations preventing the abuse of this subsection
through cross-collateralization or other means.''
(c) Technical Amendments.--
(1) Subparagraph (A) of section 108(a)(2) is amended by
striking ``and (C)'' and inserting ``, (C), and (D)''.
(2) Subparagraph (B) of section 108(a)(2) is amended to
read as follows:
``(B) Insolvency exclusion takes precedence over
qualified farm exclusion and qualified real property
business exclusion.--Subparagraphs (C) and (D) of
paragraph (1) shall not apply to a discharge to the
extent the taxpayer is insolvent.''
(3) Subsection (d) of section 108 is amended--
(A) by striking ``subsections (a), (b), and (g)''
in paragraphs (6) and (7)(A) and inserting
``subsections (a), (b), (c), and (g)'',
(B) by striking ``Subsections (a), (b), and (g)''
in the subsection heading and inserting ``Certain
Provisions'', and
(C) by striking ``Subsections (a), (b), and (g)''
in the headings of paragraphs (6) and (7)(A) and
inserting ``Certain provisions''.
(4) Subparagraph (B) of section 108(d)(7) is amended by
adding at the end thereof the following new sentence: ``The
preceding sentence shall not apply to any discharge to the
extent that subsection (a)(1)(D) applies to such discharge.''
(5) Subparagraph (A) of section 108(d)(9) is amended by
inserting ``or under paragraph (3)(B) of subsection (c)'' after
``subsection (b)''.
(6) Paragraph (2) of section 1017(a) is amended by striking
``or (b)(5)'' and inserting ``, (b)(5), or (c)(1)''.
(7) Subparagraph (A) of section 1017(b)(3) is amended by
inserting ``or (c)(1)'' after ``subsection (b)(5)''.
(8) Section 1017(b)(3) is amended by adding at the end the
following new subparagraph:
``(F) Special rules for qualified real property
business indebtedness.--In the case of any amount which
under section 108(c)(1) is to be applied to reduce
basis--
``(i) depreciable property shall only
include depreciable real property for purposes
of subparagraphs (A) and (C),
``(ii) subparagraph (E) shall not apply,
and
``(iii) in the case of property taken into
account under section 108(c)(2)(B), the
reduction with respect to such property shall
be made as of the time immediately before
disposition if earlier than the time under
subsection (a).''
(9) Paragraph (1) of section 703(b) is amended by striking
``subsection (b)(5)'' and inserting ``subsection (b)(5) or
(c)(3)''.
(d) Effective Date.--The amendments made by this section shall
apply to discharges after December 31, 1992, in taxable years ending
after such date.
Subpart E--Increase in Recovery Period for Nonresidential Real Property
SEC. 14151. INCREASE IN RECOVERY PERIOD FOR NONRESIDENTIAL REAL
PROPERTY.
(a) General Rule.--Paragraph (1) of section 168(c) (relating to
applicable recovery period) is amended by striking the item relating to
nonresidential real property and inserting the following:
``Nonresidential real property................ 39 years.''.
(b) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendment made by subsection (a) shall apply to property placed
in service by the taxpayer on or after February 25, 1993.
(2) Exception.--The amendments made by this section shall
not apply to property placed in service by the taxpayer before
January 1, 1994, if--
(A) the taxpayer or a qualified person entered into
a binding written contract to purchase or construct
such property before February 25, 1993, or
(B) the construction of such property was commenced
by or for the taxpayer or a qualified person before
February 25, 1993.
For purposes of this paragraph, the term ``qualified person''
means any person who transfers his rights in such a contract or
such property to the taxpayer but only if the property is not
placed in service by such person before such rights are
transferred to the taxpayer.
PART VI--LUXURY TAX
SEC. 14161. REPEAL OF LUXURY EXCISE TAXES OTHER THAN ON PASSENGER
VEHICLES.
(a) In General.--Subchapter A of chapter 31 (relating to retail
excise taxes) is amended to read as follows:
``Subchapter A--Luxury Passenger Automobiles
``Sec. 4001. Imposition of tax.
``Sec. 4002. 1st retail sale; uses, etc.
treated as sales; determination
of price.
``Sec. 4003. Special rules.
``SEC. 4001. IMPOSITION OF TAX.
``(a) Imposition of Tax.--There is hereby imposed on the 1st retail
sale of any passenger vehicle a tax equal to 10 percent of the price
for which so sold to the extent such price exceeds $30,000.
``(b) Passenger Vehicle.--
``(1) In general.--For purposes of this subchapter, the
term `passenger vehicle' means any 4-wheeled vehicle--
``(A) which is manufactured primarily for use on
public streets, roads, and highways, and
``(B) which is rated at 6,000 pounds unloaded gross
vehicle weight or less.
``(2) Special rules.--
``(A) Trucks and vans.--In the case of a truck or
van, paragraph (1)(B) shall be applied by substituting
`gross vehicle weight' for `unloaded gross vehicle
weight'.
``(B) Limousines.--In the case of a limousine,
paragraph (1) shall be applied without regard to
subparagraph (B) thereof.
``(c) Exceptions for Taxicabs, Etc.--The tax imposed by this
section shall not apply to the sale of any passenger vehicle for use by
the purchaser exclusively in the active conduct of a trade or business
of transporting persons or property for compensation or hire.
``(d) Exemption for Law Enforcement Uses, Etc.--No tax shall be
imposed by this section on the sale of any passenger vehicle--
``(1) to the Federal Government, or a State or local
government, for use exclusively in police, firefighting, search
and rescue, or other law enforcement or public safety
activities, or in public works activities, or
``(2) to any person for use exclusively in providing
emergency medical services.
``(e) Inflation Adjustment.--
``(1) In general.--In the case of any calendar year after
1992, the $30,000 amount in subsection (a) and section 4003(a)
shall be increased by an amount equal to--
``(A) $30,000, multiplied by
``(B) the cost-of-living adjustment under section
1(f)(3) for such calendar year, determined by
substituting `calendar year 1990' for `calendar year
1992' in subparagraph (B) thereof.
``(2) Rounding.--If any amount as adjusted under paragraph
(1) is not a multiple of $100, such amount shall be rounded to
the nearest multiple of $100 (or, if such amount is a multiple
of $50 and not of $100, such amount shall be rounded to the
next highest multiple of $100).
``(f) Termination.--The tax imposed by this section shall not apply
to any sale or use after December 31, 1999.
``SEC. 4002. 1ST RETAIL SALE; USES, ETC. TREATED AS SALES;
DETERMINATION OF PRICE.
``(a) 1st Retail Sale.--For purposes of this subchapter, the term
`1st retail sale' means the 1st sale, for a purpose other than resale,
after manufacture, production, or importation.
``(b) Use Treated as Sale.--
``(1) In general.--If any person uses a passenger vehicle
(including any use after importation) before the 1st retail
sale of such vehicle, then such person shall be liable for tax
under this subchapter in the same manner as if such vehicle
were sold at retail by him.
``(2) Exemption for further manufacture.--Paragraph (1)
shall not apply to use of a vehicle as material in the
manufacture or production of, or as a component part of,
another vehicle taxable under this subchapter to be
manufactured or produced by him.
``(3) Exemption for demonstration use.--Paragraph (1) shall
not apply to any use of a passenger vehicle as a demonstrator.
``(4) Exception for use after importation of certain
vehicles.--Paragraph (1) shall not apply to the use of a
vehicle after importation if the user or importer establishes
to the satisfaction of the Secretary that the 1st use of the
vehicle occurred before January 1, 1991, outside the United
States.
``(5) Computation of tax.--In the case of any person made
liable for tax by paragraph (1), the tax shall be computed on
the price at which similar vehicles are sold at retail in the
ordinary course of trade, as determined by the Secretary.
``(c) Leases Considered as Sales.--For purposes of this
subchapter--
``(1) In general.--Except as otherwise provided in this
subsection, the lease of a vehicle (including any renewal or
any extension of a lease or any subsequent lease of such
vehicle) by any person shall be considered a sale of such
vehicle at retail.
``(2) Special rules for long-term leases.--
``(A) Tax not imposed on sale for leasing in a
qualified lease.--The sale of a passenger vehicle to a
person engaged in a passenger vehicle leasing or rental
trade or business for leasing by such person in a long-
term lease shall not be treated as the 1st retail sale
of such vehicle.
``(B) Long-term lease.--For purposes of
subparagraph (A), the term `long-term lease' means any
long-term lease (as defined in section 4052).
``(C) Special rules.--In the case of a long-term
lease of a vehicle which is treated as the 1st retail
sale of such vehicle--
``(i) Determination of price.--The tax
under this subchapter shall be computed on the
lowest price for which the vehicle is sold by
retailers in the ordinary course of trade.
``(ii) Payment of tax.--Rules similar to
the rules of section 4217(e)(2) shall apply.
``(iii) No tax where exempt use by
lessee.--No tax shall be imposed on any lease
payment under a long-term lease if the lessee's
use of the vehicle under such lease is an
exempt use (as defined in section 4003(b)) of
such vehicle.
``(d) Determination of Price.--
``(1) In general.--In determining price for purposes of
this subchapter--
``(A) there shall be included any charge incident
to placing the article in condition ready for use,
``(B) there shall be excluded--
``(i) the amount of the tax imposed by this
subchapter,
``(ii) if stated as a separate charge, the
amount of any retail sales tax imposed by any
State or political subdivision thereof or the
District of Columbia, whether the liability for
such tax is imposed on the vendor or vendee,
and
``(iii) the value of any component of such
article if--
``(I) such component is furnished
by the 1st user of such article, and
``(II) such component has been used
before such furnishing, and
``(C) the price shall be determined without regard
to any trade-in.
``(2) Other rules.--Rules similar to the rules of
paragraphs (2) and (4) of section 4052(b) shall apply for
purposes of this subchapter.
``SEC. 4003. SPECIAL RULES.
``(a) Separate Purchase of Vehicle and Parts and Accessories
Therefor.--Under regulations prescribed by the Secretary--
``(1) In general.--Except as provided in paragraph (2),
if--
``(A) the owner, lessee, or operator of any
passenger vehicle installs (or causes to be installed)
any part or accessory on such vehicle, and
``(B) such installation is not later than the date
6 months after the date the vehicle was 1st placed in
service,
then there is hereby imposed on such installation a tax equal
to 10 percent of the price of such part or accessory and its
installation.
``(2) Limitation.--The tax imposed by paragraph (1) on the
installation of any part or accessory shall not exceed 10
percent of the excess (if any) of--
``(A) the sum of--
``(i) the price of such part or accessory
and its installation,
``(ii) the aggregate price of the parts and
accessories (and their installation) installed
before such part or accessory, plus
``(iii) the price for which the passenger
vehicle was sold, over
``(B) $30,000.
``(3) Exceptions.--Paragraph (1) shall not apply if--
``(A) the part or accessory installed is a
replacement part or accessory,
``(B) the part or accessory is installed to enable
or assist an individual with a disability to operate
the vehicle, or to enter or exit the vehicle, by
compensating for the effect of such disability, or
``(C) the aggregate price of the parts and
accessories (and their installation) described in
paragraph (1) with respect to the vehicle does not
exceed $200 (or such other amount or amounts as the
Secretary may by regulation prescribe).
The price of any part or accessory (and its installation) to
which paragraph (1) does not apply by reason of this paragraph
shall not be taken into account under paragraph (2)(A).
``(4) Installers secondarily liable for tax.--The owners of
the trade or business installing the parts or accessories shall
be secondarily liable for the tax imposed by this subsection.
``(b) Imposition of Tax on Sales, Etc., Within 2 Years of Vehicles
Purchased Tax-Free.--
``(1) In general.--If--
``(A) no tax was imposed under this subchapter on
the 1st retail sale of any passenger vehicle by reason
of its exempt use, and
``(B) within 2 years after the date of such 1st
retail sale, such vehicle is resold by the purchaser or
such purchaser makes a substantial nonexempt use of
such vehicle,
then such sale or use of such vehicle by such purchaser shall
be treated as the 1st retail sale of such vehicle for a price
equal to its fair market value at the time of such sale or use.
``(2) Exempt use.--For purposes of this subsection, the
term `exempt use' means any use of a vehicle if the 1st retail
sale of such vehicle is not taxable under this subchapter by
reason of such use.
``(c) Parts and Accessories Sold With Taxable Article.--Parts and
accessories sold on, in connection with, or with the sale of any
passenger vehicle shall be treated as part of the vehicle.
``(d) Partial Payments, Etc.--In the case of a contract, sale, or
arrangement described in paragraph (2), (3), or (4) of section 4216(c),
rules similar to the rules of section 4217(e)(2) shall apply for
purposes of this subchapter.''
(b) Technical Amendments.--
(1) Subsection (c) of section 4221 is amended by striking
``4002(b), 4003(c), 4004(a)'' and inserting ``4001(d)''.
(2) Subsection (d) of section 4222 is amended by striking
``4002(b), 4003(c), 4004(a)'' and inserting ``4001(d)''.
(3) The table of subchapters for chapter 31 is amended by
striking the item relating to subchapter A and inserting the
following:
``Subchapter A. Luxury passenger
vehicles.''
(c) Effective Date.--The amendments made by this section shall take
effect on January 1, 1993.
SEC. 14162. EXEMPTION FROM LUXURY EXCISE TAX FOR CERTAIN EQUIPMENT
INSTALLED ON PASSENGER VEHICLES FOR USE BY DISABLED
INDIVIDUALS.
(a) In General.--Paragraph (3) of section 4004(b) (relating to
separate purchase of article and parts and accessories therefor), as in
effect on the day before the date of the enactment of this Act, is
amended--
(1) by striking ``or'' at the end of subparagraph (A),
(2) by redesignating subparagraph (B) as subparagraph (C),
(3) by inserting after subparagraph (A) the following new
subparagraph:
``(B) the part or accessory is installed on a
passenger vehicle to enable or assist an individual
with a disability to operate the vehicle, or to enter
or exit the vehicle, by compensating for the effect of
such disability, or'', and
(4) by inserting after subparagraph (C) the following flush
sentence:
``The price of any part or accessory (and its installation) to
which paragraph (1) does not apply by reason of this paragraph
shall not be taken into account under paragraph (2)(A).''
(b) Effective Date.--The amendments made by this section shall take
effect as if included in the amendments made by section 11221(a) of the
Omnibus Budget Reconciliation Act of 1990.
(c) Period For Filing Claims.--If refund or credit of any
overpayment of tax resulting from the application of the amendments
made by this section is prevented at any time before the close of the
1-year period beginning on the date of the enactment of this Act by the
operation of any law or rule of law (including res judicata), refund or
credit of such overpayment (to the extent attributable to such
amendments) may, nevertheless, be made or allowed if claim therefor is
filed before the close of such 1-year period.
SEC. 14163. TAX ON DIESEL FUEL USED IN NONCOMMERCIAL BOATS.
(a) General Rule.--
(1) Paragraph (2) of section 4092(a) (defining diesel fuel)
is amended by striking ``or a diesel-powered train'' and
inserting ``, a diesel-powered train, or a diesel-powered
boat''.
(2) Paragraph (1) of section 4041(a) is amended--
(A) by striking ``diesel-powered highway vehicle''
each place it appears and inserting ``diesel-powered
highway vehicle or diesel-powered boat'', and
(B) by striking ``such vehicle'' and inserting
``such vehicle or boat''.
(3) Subparagraph (B) of section 4092(b)(1) is amended by
striking ``commercial and noncommercial vessels'' each place it
appears and inserting ``vessels for use in an off-highway
business use (as defined in section 6421(e)(2)(B))''.
(b) Exemption for Use In Fisheries or Commercial Navigation.--
Subparagraph (B) of section 6421(e)(2) is amended to read as follows:
``(B) Uses in boats.--The term `off-highway
business use' does not include any use in a motorboat;
except that such term shall include any use in--
``(i) a vessel employed in the fisheries or
in the whaling business, and
``(ii) in the case of diesel fuel, a boat
in the active conduct of--
``(I) a trade or business of
commercial fishing or transporting
persons or property for compensation or
hire, or
``(II) any other trade or business
unless the boat is used predominantly
in any activity which is of a type
generally considered to constitute
entertainment, amusement or
recreation.''
(c) Retention of Taxes in General Fund.--
(1) Taxes imposed at highway trust fund financing rate.--
Paragraph (4) of section 9503(b) (relating to transfers to
Highway Trust Fund) is amended--
(A) by striking ``and'' at the end of subparagraph
(A),
(B) by striking the period at the end of
subparagraph (B) and inserting ``, and'', and
(C) by adding at the end thereof the following new
subparagraph:
``(C) there shall not be taken into account the
taxes imposed by sections 4041 and 4091 on diesel fuel
sold for use or used as fuel in a diesel-powered
boat.''
(2) Taxes imposed at leaking underground storage tank trust
fund financing rate.--Subsection (b) of section 9508 (relating
to transfers to Leaking Underground Storage Tank Trust Fund) is
amended by adding at the end thereof the following new
sentence: ``For purposes of this subsection, there shall not be
taken into account the taxes imposed by sections 4041 and 4091
on diesel fuel sold for use or used as fuel in a diesel-powered
boat.''
(d) Effective Date.--The amendments made by this section shall take
effect on January 1, 1994.
PART VII--OTHER CHANGES
SEC. 14171. ALTERNATIVE MINIMUM TAX TREATMENT OF CONTRIBUTIONS OF
APPRECIATED PROPERTY.
(a) Repeal of Tax Preference.--Subsection (a) of section 57 (as
amended by section 14113) is amended by striking paragraph (6)
(relating to appreciated property charitable deduction) and by
redesignating paragraphs (7) and (8) as paragraphs (6) and (7),
respectively.
(b) Effect on Adjusted Current Earnings.--Paragraph (4) of section
56(g) is amended by adding at the end thereof the following new
subparagraph:
``(J) Treatment of charitable contributions.--
Notwithstanding subparagraphs (B) and (C), no
adjustment related to the earnings and profits effects
of any charitable contribution shall be made in
computing adjusted current earnings.''
(c) Conforming Amendment.--Subclause (II) of section
53(d)(1)(B)(ii) (as amended by section 14113) is amended by striking
``(5), (6), and (8)'' and inserting ``(5), and (7)''.
(d) Effective Date.--The amendments made by this section shall
apply to contributions made after June 30, 1992, except that in the
case of any contribution of capital gain property which is not tangible
personal property, such amendments shall apply only if the contribution
is made after December 31, 1992.
(e) Report on Advance Determination of Value of Charitable Gifts.--
Not later than 1 year after the date of the enactment of this Act, the
Secretary of the Treasury shall report to the Committee on Finance of
the Senate and the Committee on Ways and Means of the House of
Representatives on the development of a procedure under which taxpayers
may elect to seek an agreement with the Secretary as to the value of
tangible personal property prior to the donation of such property to a
qualifying charitable organization if the time limits for the donation
and other conditions contained in the agreement are satisfied. Such
report shall address the setting of possible threshold amounts for
claimed value (and the payment of fees) by a taxpayer in order to seek
agreement under the procedure, possible limitations on applying the
procedure only to items with significant artistic or cultural value,
and recommendations for legislative action needed to implement the
proposed procedure.
SEC. 14172. CERTAIN TRANSFERS TO RAILROAD RETIREMENT ACCOUNT MADE
PERMANENT.
Subsection (c)(1)(A) of section 224 of the Railroad Retirement
Solvency Act of 1983 (relating to section 72(r) revenue increase
transferred to certain railroad accounts) is amended by striking ``with
respect to benefits received before October 1, 1992''.
SEC. 14173. TEMPORARY EXTENSION OF DEDUCTION FOR HEALTH INSURANCE COSTS
OF SELF-EMPLOYED INDIVIDUALS.
(a) In General.--
(1) Extension.--Paragraph (6) of section 162(l) (relating
to special rules for health insurance costs of self-employed
individuals) is amended by striking ``June 30, 1992'' and
inserting ``December 31, 1993''.
(2) Conforming amendment.--Paragraph (2) of section 110(a)
of the Tax Extension Act of 1991 is hereby repealed.
(3) Effective date.--The amendments made by this subsection
shall apply to taxable years ending after June 30, 1992.
(b) Determination of Eligibility for Employer-Sponsored Health
Plan.--
(1) In general.--Paragraph (2)(B) of section 162(l) is
amended to read as follows:
``(B) Other coverage.--Paragraph (1) shall not
apply to any taxpayer for any calendar month for which
the taxpayer is eligible to participate in any
subsidized health plan maintained by any employer of
the taxpayer or of the spouse of the taxpayer.''
(2) Effective date.--The amendment made by paragraph (1)
shall apply to taxable years beginning after December 31, 1992.
Subtitle B--Revenue Increases
PART I--PROVISIONS AFFECTING INDIVIDUALS
Subpart A--Rate Increases
SEC. 14201. INCREASE IN TOP MARGINAL RATE UNDER SECTION 1.
(a) General Rule.--Section 1 (relating to tax imposed) is amended
by striking subsections (a) through (e) and inserting the following:
``(a) Married Individuals Filing Joint Returns and Surviving
Spouses.--There is hereby imposed on the taxable income of--
``(1) every married individual (as defined in section 7703)
who makes a single return jointly with his spouse under section
6013, and
``(2) every surviving spouse (as defined in section 2(a)),
a tax determined in accordance with the following table:
``If taxable income is: The tax is:
Not over $36,900...............
15% of taxable income.
Over $36,900 but not over
$89,150.
$5,535, plus 28% of the excess
over $36,900.
Over $89,150 but not over
$140,000.
$20,165, plus 31% of the excess
over $89,150.
Over $140,000..................
$35,928.50, plus 36% of the
excess over $140,000.
``(b) Heads of Households.--There is hereby imposed on the taxable
income of every head of a household (as defined in section 2(b)) a tax
determined in accordance with the following table:
``If taxable income is: The tax is:
Not over $29,600...............
15% of taxable income.
Over $29,600 but not over
$76,400.
$4,440, plus 28% of the excess
over $29,600.
Over $76,400 but not over
$127,500.
$17,544, plus 31% of the excess
over $76,400.
Over $127,500..................
$33,385, plus 36% of the excess
over $127,500.
``(c) Unmarried Individuals (Other Than Surviving Spouses and Heads
of Households).--There is hereby imposed on the taxable income of every
individual (other than a surviving spouse as defined in section 2(a) or
the head of a household as defined in section 2(b)) who is not a
married individual (as defined in section 7703) a tax determined in
accordance with the following table:
``If taxable income is: The tax is:
Not over $22,100...............
15% of taxable income.
Over $22,100 but not over
$53,500.
$3,315, plus 28% of the excess
over $22,100.
Over $53,500 but not over
$115,000.
$12,107, plus 31% of the excess
over $53,500.
Over $115,000..................
$31,172, plus 36% of the excess
over $115,000.
``(d) Married Individuals Filing Separate Returns.--There is hereby
imposed on the taxable income of every married individual (as defined
in section 7703) who does not make a single return jointly with his
spouse under section 6013, a tax determined in accordance with the
following table:
``If taxable income is: The tax is:
Not over $18,450...............
15% of taxable income.
Over $18,450 but not over
$44,575.
$2,767.50, plus 28% of the
excess over $18,450.
Over $44,575 but not over
$70,000.
$10,082.50, plus 31% of the
excess over $44,575.
Over $70,000...................
$17,964.25, plus 36% of the
excess over $70,000.
``(e) Estates and Trusts.--There is hereby imposed on the taxable
income of--
``(1) every estate, and
``(2) every trust,
taxable under this subsection a tax determined in accordance with the
following table:
``If taxable income is: The tax is:
Not over $1,500................
15% of taxable income.
Over $1,500 but not over $3,500
$225, plus 28% of the excess
over $1,500.
Over $3,500 but not over $5,500
$785, plus 31% of the excess
over $3,500.
Over $5,500....................
$1,405, plus 36% of the excess
over $5,500.''
(b) Conforming Amendments.--
(1) Section 531 is amended by striking ``28 percent'' and
inserting ``36 percent''.
(2) Section 541 is amended by striking ``28 percent'' and
inserting ``36 percent''.
(3)(A) Subsection (f) of section 1 is amended--
(i) by striking ``1990'' in paragraph (1) and
inserting``1993'', and
(ii) by striking ``1989'' in paragraph (3)(B) and
inserting ``1992''.
(B) Subsection (f) of section 1 is amended by adding at the
end thereof the following new paragraph:
``(7) Special rule for certain brackets.--
``(A) Calendar year 1994.--In prescribing the
tables under paragraph (1) which apply with respect to
taxable years beginning in calendar year 1994, the
Secretary shall make no adjustment to the dollar
amounts at which the 36 percent rate bracket begins or
at which the 39.6 percent rate begins under any table
contained in subsection (a), (b), (c), (d), or (e).
``(B) Later calendar years.--In prescribing tables
under paragraph (1) which apply with respect to taxable
years beginning in a calendar year after 1994, the
cost-of-living adjustment used in making adjustments to
the dollar amounts referred to in subparagraph (A)
shall be determined under paragraph (3) by substituting
`1993' for `1992'.''
(C) Subparagraph (C) of section 41(e)(5) is amended by
striking ``1989'' each place it appears and inserting ``1992''.
(D) Subparagraph (B) of section 63(c)(4) is amended by
striking ``1989'' and inserting ``1992''.
(E) Subparagraph (B) of section 68(b)(2) is amended by
striking ``1989'' and inserting ``1992''.
(F) Subparagraph (B) of section 132(f)(6) is amended by
striking ``, determined by substituting'' and all that follows
down through the period at the end thereof and inserting a
period.
(G) Subparagraphs (A)(ii) and (B)(ii) of section 151(d)(4)
are each amended by striking ``1989'' and inserting ``1992''.
(H) Clause (ii) of section 513(h)(2)(C) is amended by
striking ``1989'' and inserting ``1992''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1992.
SEC. 14202. SURTAX ON HIGH-INCOME TAXPAYERS.
(a) General Rule.--
(1) Subsection (a) of section 1 (as amended by section
14201) is amended by striking the last item in the table
contained therein and inserting the following:
Over $140,000 but not over
$250,000.
$35,928.50, plus 36% of the
excess over $140,000.
Over $250,000..................
$75,528.50, plus 39.6% of the
excess over $250,000.''
(2) Subsection (b) of section 1 (as so amended) is amended
by striking the last item in the table contained therein and
inserting the following:
Over $127,500 but not over
$250,000.
$33,385, plus 36% of the excess
over $127,500.
Over $250,000..................
$77,485, plus 39.6% of the
excess over $250,000.''
(3) Subsection (c) of section 1 (as so amended) is amended
by striking the last item in the table contained therein and
inserting the following:
Over $115,000 but not over
$250,000.
$31,172, plus 36% of the excess
over $115,000.
Over $250,000..................
$79,772, plus 39.6% of the
excess over $250,000.''
(4) Subsection (d) of section 1 (as so amended) is amended
by striking the last item in the table contained therein and
inserting the following:
Over $70,000 but not over
$125,000.
$17,964.25, plus 36% of the
excess over $70,000.
Over $125,000..................
$37,764.25, plus 39.6% of the
excess over $125,000.''
(5) Subsection (e) of section 1 (as so amended) is amended
by striking the last item in the table contained therein and
inserting the following:
Over $5,500 but not over $7,500
$1,405, plus 36% of the excess
over $5,500.
Over $7,500....................
$2,125, plus 39.6% of the
excess over $7,500.''
(b) Technical Amendment.--Sections 531 and 541 (as amended by
section 1420) are each amended by striking ``36 percent'' and inserting
``39.6 percent''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1992.
SEC. 14203. MODIFICATIONS TO ALTERNATIVE MINIMUM TAX RATES AND
EXEMPTION AMOUNTS.
(a) Increase in Rate.--Paragraph (1) of section 55(b) (defining
tentative minimum tax) is amended to read as follows:
``(1) Amount of tentative tax.--
``(A) Noncorporate taxpayers.--
``(i) In general.--In the case of a
taxpayer other than a corporation, the
tentative minimum tax for the taxable year is
the sum of--
``(I) 26 percent of so much of the
taxable excess as does not exceed
$175,000, plus
``(II) 28 percent of so much of the
taxable excess as exceeds $175,000.
The amount determined under the preceding
sentence shall be reduced by the alternative
minimum tax foreign tax credit for the taxable
year.
``(ii) Taxable excess.--For purposes of
clause (i), the term `taxable excess' means so
much of the alternative minimum taxable income
for the taxable year as exceeds the exemption
amount.
``(iii) Married individual filing separate
return.--In the case of a married individual
filing a separate return, clause (i) shall be
applied by substituting `$87,500' for
`$175,000' each place it appears. For purposes
of the preceding sentence, marital status shall
be determined under section 7703.
``(B) Corporations.--In the case of a corporation,
the tentative minimum tax for the taxable year is--
``(i) 20 percent of so much of the
alternative minimum taxable income for the
taxable year as exceeds the exemption amount,
reduced by
``(ii) the alternative minimum tax foreign
tax credit for the taxable year.''
(b) Increase in Exemption Amounts.--Paragraph (1) of section 55(d)
(defining exemption amount) is amended--
(1) by striking ``$40,000'' in subparagraph (A) and
inserting ``$45,000'',
(2) by striking ``$30,000'' in subparagraph (B) and
inserting ``$33,750'', and
(3) by striking ``$20,000'' in subparagraph (C) and
inserting ``$22,500''.
(c) Conforming Amendments.--
(1) The last sentence of section 55(d)(3) is amended by
striking ``$155,000 or (ii) $20,000'' and inserting ``$165,000
or (ii) $22,500''.
(2)(A) Subparagraph (A) of section 897(a)(2) is amended by
striking ``the amount determined under section 55(b)(1)(A)
shall not be less than 21 percent of'' and inserting ``the
taxable excess for purposes of section 55(b)(1)(A) shall not be
less than''.
(B) The heading for paragraph (2) of section 897(a) is
amended by striking ``21-Percent''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1992.
SEC. 14204. OVERALL LIMITATION ON ITEMIZED DEDUCTIONS FOR HIGH-INCOME
TAXPAYERS MADE PERMANENT.
Subsection (f) of section 68 (relating to overall limitation on
itemized deductions) is hereby repealed.
SEC. 14205. PHASEOUT OF PERSONAL EXEMPTION OF HIGH-INCOME TAXPAYERS
MADE PERMANENT.
Section 151(d)(3) (relating to phaseout of personal exemption) is
amended by striking subparagraph (E).
SEC. 14206. PROVISIONS TO PREVENT CONVERSION OF ORDINARY INCOME TO
CAPITAL GAIN.
(a) Interest Embedded in Financial Transactions.--
(1) In general.--Part IV of subchapter P of chapter 1
(relating to special rules for determining capital gains and
losses) is amended by adding at the end thereof the following
new section:
``SEC. 1258. RECHARACTERIZATION OF GAIN FROM CERTAIN FINANCIAL
TRANSACTIONS.
``(a) General Rule.--In the case of any gain--
``(1) which (but for this section) would be treated as gain
from the sale or exchange of a capital asset, and
``(2) which is recognized on the disposition of any
property which was held as part of a conversion transaction,
such gain (to the extent such gain does not exceed the applicable
imputed income amount) shall be treated as ordinary income.
``(b) Applicable Imputed Income Amount.--For purposes of subsection
(a), the term `applicable imputed income amount' means, with respect to
any disposition referred to in subsection (a), an amount equal to--
``(1) the amount of interest which would have accrued on
the taxpayer's net investment in the conversion transaction for
the period ending on the date of such disposition (or, if
earlier, the date on which the requirements of subsection (c)
ceased to be satisfied) at a rate equal to 120 percent of the
applicable rate, reduced by
``(2) the amount treated as ordinary income under
subsection (a) with respect to any prior disposition of
property which was held as a part of such transaction.
The Secretary shall by regulations provide for such reductions in the
applicable imputed income amount as may be appropriate by reason of
amounts capitalized under section 263(g), ordinary income received, or
otherwise.
``(c) Conversion Transaction.--For purposes of this section, the
term `conversion transaction' means any of the following where
substantially all of the taxpayer's expected return from the
transaction is attributable to the time value of the taxpayer's net
investment in such transaction:
``(1) The holding of any property (whether or not actively
traded), and the entering into a contract to sell such property
(or substantially identical property) at a price determined in
accordance with such contract, but only if such property was
acquired and such contract was entered into on a substantially
contemporaneous basis.
``(2) Any applicable straddle.
``(3) Any other transaction which is marketed or sold as
producing capital gains.
``(4) Any other transaction specified in regulations
prescribed by the Secretary.
``(d) Definitions and Special Rules.--For purposes of this
section--
``(1) Applicable straddle.--The term `applicable straddle'
means any straddle (within the meaning of section 1092(c));
except that the term `personal property' shall include stock.
``(2) Applicable rate.--The term `applicable rate' means--
``(A) the applicable Federal rate determined under
section 1274(d) (compounded semiannually) as if the
conversion transaction were a debt instrument, or
``(B) if the term of the conversion transaction is
indefinite, the Federal short-term rates in effect
under section 6621(b) during the period of the
conversion transaction (compounded daily).
``(3) Treatment of property with built-in loss.--
``(A) In general.--If any property with a built-in
loss becomes part of a conversion transaction--
``(i) for purposes of applying this
subtitle to such property for periods after
such property becomes part of such transaction,
the adjusted basis of such property shall be
its fair market value as of the time it became
part of such transaction, except that
``(ii) upon the disposition of such
property in a transaction in which gain or loss
is recognized, such built-in loss shall be
recognized and shall have a character
determined without regard to this section.
``(B) Built-in loss.--For purposes of subparagraph
(A), the term `built-in loss' means the excess (if any)
of the adjusted basis of any property over its fair
market value (determined as of the date on which such
property became part of such transaction).
``(4) Property taken into account at fair market value.--In
determining the taxpayer's net investment in any conversion
transaction, there shall be included the fair market value of
any property which becomes part of such transaction (determined
as of the date on which such property became part of such
transaction).''
(2) Clerical amendment.--The table of sections for part IV
of subchapter P of chapter 1 is amended by adding at the end
thereof the following new item:
``Sec. 1258. Recharacterization of gain
from certain financial
transactions.''
(3) Effective date.--The amendments made by this section
shall apply to conversion transactions entered into after April
30, 1993.
(b) Repeal of Certain Exceptions to Market Discount Rules.--
(1) Market discount bonds issued on or before july 18,
1984.--The following provisions are hereby repealed:
(A) Section 1276(e).
(B) Section 1277(d).
(2) Tax-exempt obligations.--
(A) In general.--Paragraph (1) of section 1278(a)
(defining market discount bond) is amended--
(i) by striking clause (ii) of subparagraph
(B) and redesignating subclauses (iii) and (iv)
of such subparagraph as clauses (ii) and (iii),
respectively,
(ii) by redesignating subparagraph (C) as
subparagraph (D), and
(iii) by inserting after subparagraph (B)
the following new subparagraph:
``(C) Section 1277 not applicable to tax-exempt
obligations.--For purposes of section 1277, the term
`market discount bond' shall not include any tax-exempt
obligation (as defined in section 1275(a)(3)).''
(B) Conforming amendment.--Sections 1276(a)(4) and
1278(b)(1) are each amended by striking ``sections
871(a)'' and inserting ``sections 103, 871(a),''.
(3) Effective date.--The amendments made by this section
shall apply to obligations purchased (within the meaning of
section 1272(d)(1) of the Internal Revenue Code of 1986) after
April 30, 1993.
(c) Treatment of Stripped Preferred Stock.--
(1) In general.--Section 305 is amended by redesignating
subsection (e) as subsection (f) and by inserting after
subsection (d) the following new subsection:
``(e) Treatment of Purchaser of Stripped Preferred Stock.--
``(1) In general.--If any person purchases after April 30,
1993 any stripped preferred stock, then such person, while
holding such stock, shall include in gross income amounts equal
to the amounts which would have been so includible if such
stripped preferred stock were a bond issued on the purchase
date and having original issue discount equal to the excess, if
any, of--
``(A) the redemption price for such stock, over
``(B) the price at which such person purchased such
stock.
The preceding sentence shall also apply in the case of any
person whose basis in such stock is determined by reference to
the basis in the hands of such purchaser.
``(2) Basis adjustments.--Appropriate adjustments to basis
shall be made for amounts includible in gross income under
paragraph (1).
``(3) Tax treatment of person stripping stock.--If any
person strips the rights to 1 or more dividends from any stock
described in paragraph (5)(B) and after April 30, 1993 disposes
of such dividend rights, for purposes of paragraph (1), such
person shall be treated as having purchased the stripped
preferred stock on the date of such disposition for a purchase
price equal to such person's adjusted basis in such stripped
preferred stock.
``(4) Amounts treated as ordinary income.--Any amount
included in gross income under paragraph (1) shall be treated
as ordinary income.
``(5) Stripped preferred stock.--For purposes of this
subsection--
``(A) In general.--The term `stripped preferred
stock' means any stock described in subparagraph (B) if
there has been a separation in ownership between such
stock and any dividend on such stock which has not
become payable.
``(B) Description of stock.--Stock is described in
this subsection if such stock--
``(i) is limited and preferred as to
dividends and does not participate in corporate
growth to any significant extent, and
``(ii) has a fixed redemption price.
``(6) Purchase.--For purposes of this subsection, the term
`purchase' means--
``(A) any acquisition of stock, where
``(B) the basis of such stock is not determined in
whole or in part by the reference to the adjusted basis
of such stock in the hands of the person from whom
acquired.''
(2) Coordination with section 167(e).--Paragraph (2) of
section 167(e) is amended to read as follows:
``(2) Coordination with other provisions.--
``(A) Section 273.--This subsection shall not apply
to any term interest to which section 273 applies.
``(B) Section 305(e).--This subsection shall not
apply to the holder of the dividend rights which were
separated from any stripped preferred stock to which
section 305(e)(1) applies.''
(3) Effective date.--The amendments made by this subsection
shall take effect on April 30, 1993.
(d) Treatment of Capital Gain Under Limitation on Investment
Interest.--
(1) In general.--Subparagraph (B) of section 163(d)(4)
(defining investment income) is amended to read as follows:
``(B) Investment income.--The term `investment
income' means the sum of--
``(i) gross income from property held for
investment (other than any gain taken into
account under clause (ii)(I)),
``(ii) the excess (if any) of--
``(I) the net gain attributable to
the disposition of property held for
investment, over
``(II) the net capital gain
determined by only taking into account
gains and losses from dispositions of
property held for investment, plus
``(iii) so much of the net capital gain
referred to in clause (ii)(II) (or, if lesser,
the net gain referred to in clause (ii)(I)) as
the taxpayer elects to take into account under
this clause.''
(2) Coordination with special capital gains rate.--
Subsection (h) of section 1 is amended by adding at the end
thereof the following new sentence:
``For purposes of the preceding sentence, the net capital gain for any
taxable year shall be reduced (but not below zero) by the amount which
the taxpayer elects to take into account as investment income for the
taxable year under section 163(d)(4)(B)(iii).''
(3) Effective date.--The amendments made by this subsection
shall apply to taxable years beginning after December 31, 1992.
(e) Treatment of Certain Appreciated Inventory.--
(1) Paragraph (1) of section 751(d) is amended to read as
follows:
``(1) Substantial appreciation.--
``(A) In general.--Inventory items of the
partnership shall be considered to have appreciated
substantially in value if their fair market value
exceeds 120 percent of the adjusted basis to the
partnership of such property.
``(B) Certain property excluded.--For purposes of
subparagraph (A), there shall be excluded any inventory
property if a principal purpose for acquiring such
property was to avoid the provisions of this section
relating to inventory items.''
(2) Effective date.--The amendment made by paragraph (1)
shall apply to sales, exchanges, and distributions after April
30, 1993.
Subpart B--Other Provisions
SEC. 14207. REPEAL OF LIMITATION ON AMOUNT OF WAGES SUBJECT TO HEALTH
INSURANCE EMPLOYMENT TAX.
(a) Hospital Insurance Tax.--
(1) Paragraph (1) of section 3121(a) (defining wages) is
amended--
(A) by inserting ``in the case of the taxes imposed
by sections 3101(a) and 3111(a)'' after ``(1)'',
(B) by striking ``applicable contribution base (as
determined under subsection (x))'' each place it
appears and inserting ``contribution and benefit base
(as determined under section 230 of the Social Security
Act)'', and
(C) by striking ``such applicable contribution
base'' and inserting ``such contribution and benefit
base''.
(2) Section 3121 is amended by striking subsection (x).
(b) Self-Employment Tax.--
(1) Subsection (b) of section 1402 is amended--
(A) by striking ``that part of the net'' in
paragraph (1) and inserting ``in the case of the tax
imposed by section 1401(a), that part of the net'',
(B) by striking ``applicable contribution base (as
determined under subsection (k))'' in paragraph (1) and
inserting ``contribution and benefit base (as
determined under section 230 of the Social Security
Act)'',
(C) by inserting ``and'' after ``section
3121(b),'', and
(D) by striking ``and (C) includes'' and all that
follows through ``3111(b)''.
(2) Section 1402 is amended by striking subsection (k).
(c) Railroad Retirement Tax.--
(1) Subparagraph (A) of section 3231(e)(2) is amended by
adding at the end thereof the following new clause:
``(iii) Hospital insurance taxes.--Clause
(i) shall not apply to--
``(I) so much of the rate
applicable under section 3201(a) or
3221(a) as does not exceed the rate of
tax in effect under section 3101(b),
and
``(II) so much of the rate
applicable under section 3211(a)(1) as
does not exceed the rate of tax in
effect under section 1402(b).''
(2) Clause (i) of section 3231(e)(2)(B) is amended to read
as follows:
``(i) Tier 1 taxes.--Except as provided in
clause (ii), the term `applicable base' means
for any calendar year the contribution and
benefit base determined under section 230 of
the Social Security Act for such calendar
year.''
(d) Technical Amendments.--
(1) Paragraph (1) of section 6413(c) is amended by striking
``section 3101 or section 3201'' and inserting ``section
3101(a) or section 3201(a) (to the extent the rate applicable
under section 3201(a) as does not exceed the rate of tax in
effect under section 3101(a))''.
(2) Subparagraphs (B) and (C) of section 6413(c)(2) are
each amended by striking ``section 3101'' each place it appears
and inserting ``section 3101(a)''.
(3) Subsection (c) of section 6413 is amended by striking
paragraph (3).
(4) Sections 3122 and 3125 of such Code are each amended by
striking ``applicable contribution base limitation'' and
inserting ``contribution and benefit base limitation''.
(e) Effective Date.--The amendments made by this section shall
apply to 1994 and later calendar years.
SEC. 14208. TOP ESTATE AND GIFT TAX RATES MADE PERMANENT.
(a) General Rule.--The table contained in paragraph (1) of section
2001(c) is amended by striking the last item and inserting the
following new items:
``Over $2,500,000 but not over
$3,000,000.
$1,025,800, plus 53% of the
excess over $2,500,000.
Over $3,000,000................
$1,290,800, plus 55% of the
excess over
$3,000,000.''
(b) Conforming Amendments.--
(1) Subsection (c) of section 2001 is amended by striking
paragraph (2) and by redesignating paragraph (3) as paragraph
(2).
(2) Paragraph (2) of section 2001(c), as redesignated by
paragraph (1), is amended by striking ``($18,340,000 in the
case of decedents dying, and gifts made, after 1992)''.
(3) The last sentence of section 2101(b) is amended by
striking ``section 2001(c)(3)'' and inserting ``section
2001(c)(2)''.
(c) Effective Date.--The amendments made by this section shall
apply in the case of decedents dying, and gifts made, after December
31, 1992.
SEC. 14209. REDUCTION IN DEDUCTIBLE PORTION OF BUSINESS MEALS AND
ENTERTAINMENT.
(a) General Rule.--Paragraph (1) of section 274(n) (relating to
only 80 percent of meal and entertainment expenses allowed as
deduction) is amended by striking ``80 percent'' and inserting ``50
percent''.
(b) Conforming Amendment.--The subsection heading for section
274(n) is amended by striking ``80'' and inserting ``50''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
SEC. 14210. ELIMINATION OF DEDUCTION FOR CLUB MEMBERSHIP FEES.
(a) In General.--Subsection (a) of section 274 (relating to
disallowance of certain entertainment, etc., expenses) is amended by
adding at the end thereof the following new paragraph:
``(3) Denial of deduction for club dues.--Notwithstanding
the preceding provisions of this subsection, no deduction shall
be allowed under this chapter for amounts paid or incurred for
membership in any club organized for business, pleasure,
recreation, or other social purpose. The preceding sentence
shall not apply in the case of an airline or hotel club.''
(b) Exception for Employee Recreational Expenses Not To Apply.--
Paragraph (4) of section 274(e) is amended by adding at the end thereof
the following: ``This paragraph shall not apply for purposes of
subsection (a)(3).''
(c) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred after December 31, 1993.
SEC. 14211. DISALLOWANCE OF DEDUCTION FOR CERTAIN EMPLOYEE REMUNERATION
IN EXCESS OF $1,000,000.
(a) General Rule.--Section 162 (relating to trade or business
expenses) is amended by redesignating subsection (m) as subsection (n)
and by inserting after subsection (l) the following new subsection:
``(m) Certain Excessive Employee Remuneration.--
``(1) In general.--In the case of any publicly held
corporation, no deduction shall be allowed under this chapter
for applicable employee remuneration with respect to any
covered employee to the extent that the amount of such
remuneration for the taxable year with respect to such employee
exceeds $1,000,000.
``(2) Publicly held corporation.--For purposes of this
subsection, the term `publicly held corporation' means any
corporation issuing any class of common equity securities
required to be registered under section 12 of the Securities
Exchange Act of 1934.
``(3) Covered employee.--For purposes of this subsection,
the term `covered employee' means any employee of the taxpayer
if--
``(A) as of the close of the taxable year, such
employee is the chief executive officer of the taxpayer
or an individual acting in such a capacity, or
``(B) the total compensation for the taxable year
of such employee is required to be reported to
shareholders under the Securities Exchange Act of 1934
by reason of such employee being among the 4 highest
compensated officers for the taxable year (other than
the chief executive officer).
``(4) Applicable employee remuneration.--For purposes of
this subsection--
``(A) In general.--Except as otherwise provided in
this paragraph, the term `applicable employee
remuneration' means, with respect to any covered
employee for any taxable year, the aggregate amount
allowable as a deduction under this chapter for such
taxable year (determined without regard to this
subsection) for remuneration for services performed by
such employee (whether or not during the taxable year).
``(B) Exception for remuneration payable on
commission basis.--The term `applicable employee
remuneration' shall not include any remuneration
payable on a commission basis solely on account of
income generated directly by the individual performance
of the individual to whom such remuneration is payable.
``(C) Other performance-based compensation.--The
term `applicable employee remuneration' shall not
include any remuneration payable solely on account of
the attainment of one or more performance goals but
only if--
``(i) the performance goals are determined
by a compensation committee of the board of
directors of the taxpayer which is comprised
solely of 2 or more independent directors,
``(ii) the material terms under which the
remuneration is to be paid, including the
performance goals, are disclosed to
shareholders and approved by a majority of the
vote in a separate shareholder vote before the
payment of such remuneration, and
``(iii) before any payment of such
remuneration, the compensation committee
referred to in clause (i) certifies that the
performance goals and any other material terms
were in fact satisfied.
``(D) Exception for existing binding contracts.--
The term `applicable employee remuneration' shall not
include any remuneration payable under a written
binding contract which was in effect on February 17,
1993, and which was not modified thereafter in any
material respect before such remuneration is paid.
``(E) Remuneration.--For purposes of this
paragraph, the term `remuneration' includes any
remuneration (including benefits) in any medium other
than cash, but shall not include--
``(i) any payment referred to in so much of
section 3121(a)(5) as precedes subparagraph (E)
thereof, and
``(ii) any benefit provided to or on behalf
of an employee if at the time such benefit is
provided it is reasonable to believe that the
employee will be able to exclude such benefit
from gross income under this chapter.
For purposes of clause (i), section 3121(a)(5) shall be
applied without regard to section 3121(v)(1).
``(F) Coordination with disallowed golden parachute
payments.--The dollar limitation contained in paragraph
(1) shall be reduced (but not below zero) by the amount
(if any) which would have been included in the
applicable employee remuneration of the covered
employee for the taxable year but for being disallowed
under section 280G.''
(b) Effective Date.--The amendment made by subsection (a) shall
apply to amounts which would otherwise be deductible for taxable years
beginning on or after January 1, 1994.
SEC. 14212. REDUCTION IN COMPENSATION TAKEN INTO ACCOUNT IN DETERMINING
CONTRIBUTIONS AND BENEFITS UNDER QUALIFIED RETIREMENT
PLANS.
(a) In General.--Sections 401(a)(17), 404(l), and 505(b)(7) are
each amended--
(1) by striking ``$200,000'' in the first sentence and
inserting ``$150,000'', and
(2) by striking the second sentence and inserting ``In the
case of years beginning after 1994, the Secretary shall adjust
the $150,000 amount at the same time and in the same manner as
under section 415(d), except that the base period for purposes
of section 415(d)(1)(A) shall be the calendar quarter beginning
October 1, 1994.''
(b) Simplified Employee Pensions.--
(1) In general.--Paragraphs (3)(C) and (6)(D)(ii) of
section 408(k) are each amended by striking ``$200,000'' and
inserting ``$150,000''.
(2) Cost-of-living.--Paragraph (8) of section 408(k) is
amended to read as follows:
``(8) Cost-of-living adjustment.--The Secretary shall
adjust the $300 amount in paragraph (2)(C) at the same time and
in the same manner as under section 415(d) and shall adjust the
$150,000 amount in paragraphs (3)(C) and (6)(D)(ii) at the same
time and by the same amount as the adjustment to the $150,000
amount in section 401(a)(17).''
(c) Conforming Amendment.--The heading for section 505(b)(7) is
amended by striking ``$200,000''.
(d) Effective Date.--The amendments made by this section shall
apply to benefits accruing in plan years beginning after December 31,
1993.
SEC. 14213. MODIFICATION TO DEDUCTION FOR CERTAIN MOVING EXPENSES.
(a) Repeal of Deduction for Qualified Residence Sale, Etc.,
Expenses.--
(1) In general.--Paragraph (1) of section 217(b) (defining
moving expenses) is amended by inserting ``or'' at the end of
subparagraph (C), by striking ``, or'' at the end of
subparagraph (D) and inserting a period, and by striking
subparagraph (E).
(2) Conforming amendments.--
(A) Subsection (b) of section 217 is amended by
striking paragraph (2) and redesignating paragraph (3)
as paragraph (2).
(B) Paragraph (2) of section 217(b) (as
redesignated by subparagraph (A)) is amended--
(i) by striking the last sentence of
subparagraph (A), and
(ii) by striking ``, and by'' in
subparagraph (B) and all that follows down
through the period at the end of subparagraph
(B) and inserting a period.
(C) Paragraph (1) of section 217(h) is amended by
striking subparagraphs (B) and (C) and inserting the
following:
``(B) subsection (b)(2)(A) shall be applied by
substituting `$4,500' for `$1,500', and
``(C) subsection (b)(2)(B) shall be applied as if
the last sentence of such subsection read as follows:
`In the case of a husband and wife filing separate
returns, subparagraph (A) shall be applied by
substituting ``$2,250'' for ``$4,500''.' ''
(D) Section 217 is amended by striking subsection
(e).
(b) Deduction Disallowed for Meal Expenses.--Paragraph (1) of
section 217(b) is amended--
(1) by striking ``meals and lodging'' in subparagraphs (B),
(C) and (D) and inserting ``lodging'', and
(2) by adding at the end thereof the following new
sentence:
``Such term shall not include any expenses for meals.''.
(c) Effective Date.--The amendments made by this section shall
apply to expenses incurred after December 31, 1993.
SEC. 14214. SIMPLIFICATION OF INDIVIDUAL ESTIMATED TAX SAFE HARBOR
BASED ON LAST YEAR'S TAX.
(a) In General.--Paragraph (1) of section 6654(d) (relating to
amount of required estimated tax installments) is amended by striking
subparagraphs (C), (D), (E), and (F) and by inserting the following new
subparagraph:
``(C) Limitation on use of preceding year's tax.--
``(i) In general.--If the adjusted gross
income shown on the return of the individual
for the preceding taxable year exceeds
$150,000, clause (ii) of subparagraph (B) shall
be applied by substituting `110 percent' for
`100 percent'.
``(ii) Separate returns.--In the case of a
married individual (within the meaning of
section 7703) who files a separate return for
the taxable year for which the amount of the
installment is being determined, clause (i)
shall be applied by substituting `$75,000' for
`$150,000'.
``(iii) Special rule.--In the case of an
estate or trust, adjusted gross income shall be
determined as provided in section 67(e).''
(b) Conforming Amendments.--
(1) Subparagraph (A) of section 6654(j)(3) is amended by
striking ``and subsection (d)(1)(C)(iii) shall not apply'',
(2) Paragraph (4) of section 6654(l) is amended by striking
``paragraphs (1)(C)(iv) and (2)(B)(i) of subsection (d)'' and
inserting ``subsection (d)(2)(B)(i)''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
SEC. 14215. SOCIAL SECURITY AND TIER 1 RAILROAD RETIREMENT BENEFITS.
(a) In General.--Subsections (a) (1) and (2) of section 86
(relating to social security and tier 1 railroad retirement benefits)
are each amended by striking ``one-half'' and inserting ``85 percent''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to taxable years beginning after December 31, 1993.
(c) Additional Receipts Retained in General Fund.--
(1) Subsection (e) of section 121 of the Social Security
Amendments of 1983 is amended by adding at the end the
following new paragraph:
``(5) Certain increased receipts retained in general
fund.--In determining the amount appropriated to any payor fund
under paragraph (1), there shall be excluded any increase in
tax liability to the extent such increase is attributable to
the amendments made to section 86 of the Internal Revenue Code
of 1986 by the Revenue Reconciliation Act of 1993.''.
(2) Paragraph (4) of subsection (e) of such section 121 is
amended by redesignating subparagraphs (A) and (B) as
subparagraphs (B) and (C) and by inserting before subparagraph
(B) (as so redesignated) the following new subparagraph:
``(A) the total aggregate increase in tax liability
under chapter 1 of the Internal Revenue Code of 1986
which is attributable to the application of sections 86
and 871(a)(3) of such Code,''.
PART II--PROVISIONS AFFECTING BUSINESSES
SEC. 14221. INCREASE IN TOP MARGINAL RATE UNDER SECTION 11.
(a) General Rule.--Paragraph (1) of section 11(b) (relating to
amount of tax) is amended--
(1) by striking ``and'' at the end of subparagraph (B),
(2) by striking subparagraph (C) and inserting the
following:
``(C) 34 percent of so much of the taxable income
as exceeds $75,000 but does not exceed $10,000,000, and
``(D) 35 percent of so much of the taxable income
as exceeds $10,000,000.'', and
(3) by adding at the end thereof the following new
sentence: ``In the case of a corporation which has taxable
income in excess of $15,000,000, the amount of the tax
determined under the foregoing provisions of this paragraph
shall be increased by an additional amount equal to the lesser
of (i) 3 percent of such excess, or (ii) $100,000.''.
(b) Certain Personal Service Corporations.--Paragraph (2) of
section 11(b) is amended by striking ``34 percent'' and inserting ``35
percent''.
(c) Conforming Amendments.--
(1) Clause (iii) of section 852(b)(3)(D) is amended by
striking ``66 percent'' and inserting ``65 percent''.
(2) Subsection (a) of section 1201 is amended by striking
``34 percent'' each place it appears and inserting ``35
percent''.
(3) Paragraphs (1) and (2) of section 1445(e) are each
amended by striking ``34 percent'' and inserting ``35
percent''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning on or after January 1, 1993; except
that the amendment made by subsection (c)(3) shall take effect on the
date of the enactment of this Act.
SEC. 14222. DENIAL OF DEDUCTION FOR LOBBYING EXPENSES.
(a) Disallowance of Deduction.--Section 162(e) (relating to
appearances, etc., with respect to legislation) is amended to read as
follows:
``(e) Denial of Deduction for Certain Lobbying and Political
Expenditures.--
``(1) In general.--No deduction shall be allowed under
subsection (a) for any amount paid or incurred--
``(A) in connection with influencing legislation,
``(B) for participation in, or intervention in, any
political campaign on behalf of (or in opposition to)
any candidate for public office, or
``(C) in connection with any attempt to influence
the general public, or segments thereof, with respect
to elections.
``(2) Application to dues.--
``(A) In general.--No deduction shall be allowed
under subsection (a) for the portion of dues or other
similar amounts (paid by the taxpayer with respect to
an organization) which is allocable to the expenditures
described in paragraph (1).
``(B) Allocation.--
``(i) In general.--For purposes of
subparagraph (A), expenditures described in
paragraph (1) shall be treated as paid out of
dues or other similar amounts.
``(ii) Carryover of lobbying expenditures
in excess of dues.--For purposes of this
paragraph, if expenditures described in
paragraph (1) exceed the dues or other similar
amounts for any calendar year, such excess
shall be treated as expenditures described in
paragraph (1) which are paid or incurred by the
organization during the following calendar
year.
``(3) Influencing legislation.--For purposes of this
subsection--
``(A) In general.--The term `influencing
legislation' means--
``(i) any attempt to influence the general
public, or segments thereof, with respect to
legislation, and
``(ii) any attempt to influence any
legislation through communication with any
member or employee of the legislative body, or
with any government official or employee who
may participate in the formulation of the
legislation.
``(B) Exception for certain technical advice.--The
term `influencing legislation' shall not include the
providing of technical advice or assistance to a
governmental body or to a committee or other
subdivision thereof in response to a specific written
request by such governmental entity to the taxpayer
which specifies the nature of the advice or assistance
requested.
``(C) Legislation.--The term `legislation' has the
meaning given such term by section 4911(e)(2).
``(4) Exception for certain taxpayers.--In the case of any
taxpayer engaged in the trade or business of conducting
activities described in paragraph (1), paragraph (1) shall not
apply to expenditures of the taxpayer in conducting such
activities on behalf of another person (but shall apply to
payments by such other person to the taxpayer for conducting
such activities).
``(5) Cross reference.--
``For reporting requirements related to
this subsection, see section 6050O.''
(b) Reporting Requirements.--
(1) In general.--Subpart B of part III of subchapter A of
chapter 61 (relating to information concerning transactions
with other persons) is amended by adding at the end the
following new section:
``SEC. 6050O. RETURNS RELATING TO LOBBYING EXPENDITURES OF CERTAIN
ORGANIZATIONS.
``(a) Requirement of Reporting.--Each organization referred to in
section 162(e)(2) shall make a return, according to the forms or
regulations prescribed by the Secretary, setting forth the names and
addresses of persons paying dues to the organization, the amount of the
dues paid by such person, and the portion of such dues which is
nondeductible under section 162(e)(2).
``(b) Statements To Be Furnished to Persons With Respect to Whom
Information Is Furnished.--Any organization required to make a return
under subsection (a) shall furnish to each person whose name is
required to be set forth in such return a written statement showing--
``(1) the name and address of the organization, and
``(2) the dues paid by the person during the calendar year
and the portion of such dues which is nondeductible under
section 162(e)(2).
The written statement required under the preceding sentence shall be
furnished (either in person or in a statement mailing by first-class
mail which includes adequate notice that the statement is enclosed) to
the persons on or before January 31 of the year following the calendar
year for which the return under subsection (a) was made and shall be in
such form as the Secretary may prescribe by regulations.
``(c) Waiver.--The Secretary may waive the reporting requirements
of this section with respect to any organization or class of
organizations if the Secretary determines that such reporting is not
necessary to carry out the purposes of section 162(e).
``(d) Dues.--For purposes of this section, the term `dues' includes
other similar amounts.''
(2) Penalties.--
(A) Returns.--Subparagraph (A) of section
6724(d)(1) (defining information return) is amended by
striking ``or'' at the end of clause (xi), by striking
the period at the end of the clause (xii) relating to
section 4101(d) and inserting a comma, by redesignating
the clause (xii) relating to section 338(h)(10) as
clause (xiii), by striking the period at the end of
clause (xiii) (as so redesignated) and inserting ``,
or'', and by adding at the end the following new
clause:
``(xiv) section 6050O(a) (relating to
information on nondeductible lobbying
expenditures).''
(B) Payee statements.--Paragraph (2) of section
6724(d) (defining payee statement) is amended by
striking ``or'' at the end of subparagraph (R), by
striking the period at the end of subparagraph (S) and
inserting ``, or'', and by adding at the end the
following new subparagraph:
``(T) section 6050O(b) (relating to returns on
nondeductible lobbying expenditures).''
(C) Excessive underreporting.--Section 6721
(relating to failure to file correct information
returns) is amended by adding at the end the following
new subsection:
``(f) Penalty in Case of Excessive Underreporting on Nondeductible
Dues.--If the aggregate amount of nondeductible dues which is reported
on the return required to be filed under section 6050O(a) for any
calendar year is less than 75 percent of the aggregate amount required
to be so reported--
``(1) subsections (b), (c), and (d) shall not apply, and
``(2) the penalty imposed under subsection (a) shall be
equal to the product of--
``(A) the amount required to be reported which was
not so reported, and
``(B) the highest rate of tax imposed by section 11
for taxable years beginning in such calendar year.''
(3) Conforming amendment.--The table of sections for
subpart B of part III of subchapter A of chapter 61 is amended
by adding at the end the following new item:
``Sec. 6050O. Returns relating to
lobbying expenditures of
certain organizations.''
(c) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred after December 31, 1993.
SEC. 14223. MARK TO MARKET ACCOUNTING METHOD FOR SECURITIES DEALERS.
(a) General Rule.--Subpart D of part II of subchapter E of chapter
1 (relating to inventories) is amended by adding at the end thereof the
following new section:
``SEC. 475. MARK TO MARKET ACCOUNTING METHOD FOR DEALERS IN SECURITIES.
``(a) General Rule.--Notwithstanding any other provision of this
subpart, the following rules shall apply to securities held by a dealer
in securities:
``(1) Any security which is inventory in the hands of the
dealer shall be included in inventory at its fair market value.
``(2) In the case of any security which is not inventory in
the hands of the dealer and which is held at the close of any
taxable year--
``(A) the dealer shall recognize gain or loss as if
such security were sold for its fair market value on
the last business day of such taxable year, and
``(B) any gain or loss shall be taken into account
for such taxable year.
Proper adjustment shall be made in the amount of any gain or
loss subsequently realized for gain or loss taken into account
under the preceding sentence. The Secretary may provide by
regulations for the application of this paragraph at times
other than the times provided in this paragraph.
``(b) Exceptions.--
``(1) In general.--Subsection (a) shall not apply to--
``(A) any security held for investment,
``(B)(i) any security described in subsection
(c)(2)(C) which is acquired (including originated) by
the taxpayer in the ordinary course of a trade or
business of the taxpayer and which is not held for
sale, and (ii) any obligation to acquire a security
described in clause (i) if such obligation is entered
into in the ordinary course of such trade or business
and is not held for sale, and
``(C) any security which is a hedge with respect
to--
``(i) a security to which subsection (a)
does not apply, or
``(ii) a position, right to income, or a
liability which is not a security in the hands
of the taxpayer.
To the extent provided in regulations, subparagraph (C) shall
not apply to any security held by a person in its capacity as a
dealer in securities.
``(2) Identification required.--A security shall not be
treated as described in subparagraph (A), (B), or (C) of
paragraph (1), as the case may be, unless such security is
clearly identified in the dealer's records as being described
in such subparagraph before the close of the day on which it
was acquired, originated, or entered into (or such other time
as the Secretary may by regulations prescribe).
``(3) Securities subsequently not exempt.--If a security
ceases to be described in paragraph (1) at any time after it
was identified as such under paragraph (2), subsection (a)
shall apply to any changes in value of the security occurring
after the cessation.
``(4) Special rule for property held for investment.--To
the extent provided in regulations, subparagraph (A) of
paragraph (1) shall not apply to any security described in
subparagraph (D) or (E) of subsection (c)(2) which is held by a
dealer in such securities.
``(c) Definitions.--For purposes of this section--
``(1) Dealer in securities defined.--The term `dealer in
securities' means a taxpayer who--
``(A) regularly purchases securities from or sells
securities to customers in the ordinary course of a
trade or business; or
``(B) regularly offers to enter into, assume,
offset, assign or otherwise terminate positions in
securities with customers in the ordinary course of a
trade or business.
``(2) Security defined.--The term `security' means any--
``(A) share of stock in a corporation;
``(B) partnership or beneficial ownership interest
in a widely held or publicly traded partnership or
trust;
``(C) note, bond, debenture, or other evidence of
indebtedness;
``(D) interest rate, currency, or equity notional
principal contract;
``(E) evidence of an interest in, or a derivative
financial instrument in, any security described in
subparagraph (A), (B), (C), or (D), or any currency,
including any option, forward contract, short position,
and any similar financial instrument in such a security
or currency; and
``(F) position which--
``(i) is not a security described in
subparagraph (A), (B), (C), (D), or (E),
``(ii) is a hedge with respect to such a
security, and
``(iii) is clearly identified in the
dealer's records as being described in this
subparagraph before the close of the day on
which it was acquired or entered into (or such
other time as the Secretary may by regulations
prescribe).
Subparagraph (E) shall not include any contract to which
section 1256(a) applies.
``(3) Hedge.--The term `hedge' means any position which
reduces the dealer's risk of interest rate or price changes or
currency fluctuations, including any position which is
reasonably expected to become a hedge within 60 days after the
acquisition of the position.
``(d) Special Rules.--For purposes of this section--
``(1) Coordination with certain rules.--The rules of
sections 263(g), 263A, and 1256(a) shall not apply to
securities to which subsection (a) applies, and section 1091
shall not apply (and section 1092 shall apply) to any loss
recognized under subsection (a).
``(2) Improper identification.--If a taxpayer--
``(A) identifies any security under subsection
(b)(2) as being described in subsection (b)(1) and such
security is not so described, or
``(B) fails under subsection (c)(2)(F)(iii) to
identify any position which is described in subsection
(c)(2)(F) (without regard to clause (iii) thereof) at
the time such identification is required,
the provisions of subsection (a) shall apply to such security
or position, except that any loss under this section prior to
the disposition of the security or position shall be recognized
only to the extent of gain previously recognized under this
section (and not previously taken into account under this
paragraph) with respect to such security or position.
``(3) Character of gain or loss.--
``(A) In general.--Except as provided in
subparagraph (B) or section 1236(b)--
``(i) In general.--Any gain or loss with
respect to a security under subsection (a)(2)
shall be treated as ordinary income or loss.
``(ii) Special rule for dispositions.--If--
``(I) gain or loss is recognized
with respect to a security before the
close of the taxable year, and
``(II) subsection (a)(2) would have
applied if the security were held as of
the close of the taxable year,
such gain or loss shall be treated as ordinary
income or loss.
``(B) Exception.--Subparagraph (A) shall not apply
to any gain or loss which is allocable to a period
during which--
``(i) the security is described in
subsection (b)(1)(C) (without regard to
subsection (b)(2)),
``(ii) the security is held by a person
other than in connection with its activities as
a dealer in securities, or
``(iii) the security is improperly
identified (within the meaning of subparagraph
(A) or (B) of paragraph (2)).
``(e) Regulatory Authority.--The Secretary shall prescribe such
regulations as may be necessary or appropriate to carry out the
purposes of this section, including rules--
``(1) to prevent the use of year-end transfers, related
parties, or other arrangements to avoid the provisions of this
section, and
``(2) to provide for the application of this section to any
security which is a hedge which cannot be identified with a
specific security, position, right to income, or liability.''
(b) Conforming Amendments.--
(1) Paragraph (1) of section 988(d) is amended--
(A) by striking ``section 1256'' and inserting
``section 475 or 1256'', and
(B) by striking ``1092 and 1256'' and inserting
``475, 1092, and 1256''.
(2) The table of sections for subpart D of part II of
subchapter E of chapter 1 is amended by adding at the end
thereof the following new item:
``Sec. 475. Mark to market accounting
method for dealers in
securities.''
(c) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to all taxable years ending on or after December 31,
1993.
(2) Change in method of accounting.--In the case of any
taxpayer required by this section to change its method of
accounting for any taxable year--
(A) such change shall be treated as initiated by
the taxpayer,
(B) such change shall be treated as made with the
consent of the Secretary, and
(C) except as provided in paragraph (3), the net
amount of the adjustments required to be taken into
account by the taxpayer under section 481 of the
Internal Revenue Code of 1986 shall be taken into
account ratably over the 5-taxable year period
beginning with the first taxable year ending on or
after December 31, 1993.
(3) Special rule for floor specialists and market makers.--
(A) In general.--If--
(i) a taxpayer used the last-in first-out
(LIFO) method of accounting with respect to any
qualified securities for its last taxable year
ending before December 31, 1993, and
(ii) any portion of the net amount
described in paragraph (2)(C) is attributable
to the use of such method of accounting,
then paragraph (2)(C) shall be applied by taking such
portion into account ratably over the 20-taxable year
period beginning with the first taxable year ending on
or after December 31, 1993 (or, if shorter, the period
of taxable years equal to the greater of 5 years or the
number of taxable years before such first taxable year
for which the taxpayer (or any predecessor) used such
method of accounting).
(B) Qualified security.--For purposes of this
paragraph, the term ``qualified security'' means any
security acquired--
(i) by a floor specialist (as defined in
section 1236(d)(2) of the Internal Revenue Code
of 1986) in connection with the specialist's
duties as a specialist on an exchange, but only
if the security is one in which the specialist
is registered with the exchange, or
(ii) by a taxpayer who is a market maker in
connection with the taxpayer's duties as a
market maker, but only if--
(I) the security is included on the
National Association of Security
Dealers Automated Quotation System,
(II) the taxpayer is registered as
a market maker in such security with
the National Association of Security
Dealers, and
(III) as of the last day of the
taxable year preceding the taxpayer's
first taxable year ending on or after
December 31, 1993, the taxpayer (or any
predecessor) has been actively and
regularly engaged as a market maker in
such security for the 2-year period
ending on such date (or, if shorter,
the period beginning 61 days after the
security was listed in such quotation
system and ending on such date).
SEC. 14224. CLARIFICATION OF TREATMENT OF CERTAIN FSLIC FINANCIAL
ASSISTANCE.
(a) General Rule.--For purposes of chapter 1 of the Internal
Revenue Code of 1986--
(1) any FSLIC assistance with respect to any loss of
principal, capital, or similar amount upon the disposition of
any asset shall be taken into account as compensation for such
loss for purposes of section 165 of such Code, and
(2) any FSLIC assistance with respect to any debt shall be
taken into account for purposes of section 166, 585, or 593 of
such Code in determining whether such debt is worthless (or the
extent to which such debt is worthless) and in determining the
amount of any addition to a reserve for bad debts arising from
the worthlessness or partial worthlessness of such debts.
(b) FSLIC Assistance.--For purposes of this section, the term
``FSLIC assistance'' means any assistance (or right to assistance) with
respect to a domestic building and loan association (as defined in
section 7701(a)(19) of such Code without regard to subparagraph (C)
thereof) under section 406(f) of the National Housing Act or section
21A of the Federal Home Loan Bank Act (or under any similar provision
of law).
(c) Effective Date.--
(1) In general.--Except as otherwise provided in this
subsection--
(A) The provisions of this section shall apply to
taxable years ending on or after March 4, 1991, but
only with respect to FSLIC assistance not credited
before March 4, 1991.
(B) If any FSLIC assistance not credited before
March 4, 1991, is with respect to a loss sustained or
charge-off in a taxable year ending before March 4,
1991, for purposes of determining the amount of any net
operating loss carryover to a taxable year ending on or
after March 4, 1991, the provisions of this section
shall apply to such assistance for purposes of
determining the amount of the net operating loss for
the taxable year in which such loss was sustained or
debt written off. Except as provided in the preceding
sentence, this section shall not apply to any FSLIC
assistance with respect to a loss sustained or charge-
off in a taxable year ending before March 4, 1991.
(2) Exceptions.--The provisions of this section shall not
apply to any assistance to which the amendments made by section
1401(a)(3) of the Financial Institutions Reform, Recovery, and
Enforcement Act of 1989 apply.
SEC. 14225. MODIFICATION OF CORPORATE ESTIMATED TAX RULES.
(a) Increase in Required Installment Based on Current Year Tax.--
(1) In general.--Clause (i) of section 6655(d)(1)(B)
(relating to amount of required installment) is amended by
striking ``91 percent'' each place it appears and inserting
``100 percent''.
(2) Conforming amendments.--
(A) Subsection (d) of section 6655 is amended--
(i) by striking paragraph (3), and
(ii) by striking ``91 percent'' in the
paragraph heading of paragraph (2) and
inserting ``100 percent''.
(B) Clause (ii) of section 6655(e)(2)(B) is amended
by striking the table contained therein and inserting
the following:
``In the case of the following re- The applicable
quired installments: percentage is:
1st........................................... 25
2nd........................................... 50
3rd........................................... 75
4th........................................... 100.''
(C) Clause (i) of section 6655(e)(3)(A) is amended
by striking ``91 percent'' and inserting ``100
percent''.
(b) Modification of Periods for Applying Annualization.--
(1) Clause (i) of section 6655(e)(2)(A) is amended--
(A) by striking ``or for the first 5 months'' in
subclause (II),
(B) by striking ``or for the first 8 months'' in
subclause (III), and
(C) by striking ``or for the first 11 months'' in
subclause (IV).
(2) Paragraph (2) of section 6655(e) is amended by adding
at the end thereof the following new subparagraph:
``(C) Election for different annualization
periods.--
``(i) If the taxpayer makes an election
under this clause--
``(I) subclause (I) of subparagraph
(A)(i) shall be applied by substituting
`2 months' for `3 months',
``(II) subclause (II) of
subparagraph (A)(i) shall be applied by
substituting `4 months' for `3 months',
``(III) subclause (III) of
subparagraph (A)(i) shall be applied by
substituting `7 months' for `6 months',
and
``(IV) subclause (IV) of
subparagraph (A)(i) shall be applied by
substituting `10 months' for `9
months'.
``(ii) If the taxpayer makes an election
under this clause--
``(I) subclause (II) of
subparagraph (A)(i) shall be applied by
substituting `5 months' for `3 months',
``(II) subclause (III) of
subparagraph (A)(i) shall be applied by
substituting `8 months' for `6 months',
and
``(III) subclause (IV) of
subparagraph (A)(i) shall be applied by
substituting `11 months' for `9
months'.
``(iii) An election under clause (i) or
(ii) shall apply to the taxable year for which
made and such an election shall be effective
only if made on or before the date required for
the payment of the first required installment
for such taxable year.''
(3) The last sentence of section 6655(f)(3)(A) is amended
by striking ``and subsection (e)(2)(A)'' and inserting ``and,
except in the case of an election under subsection (e)(2)(C),
subsection (e)(2)(A)''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
SEC. 14226. LIMITATION ON SECTION 936 CREDIT.
(a) General Rule.--Subsection (a) of section 936 (relating to
Puerto Rico and possession tax credit) is amended--
(1) by striking ``as provided in paragraph (3)'' in
paragraph (1) and inserting ``as otherwise provided in this
section'';
(2) by adding at the end thereof the following new
paragraph:
``(4) Limitations on credit.--
``(A) Credit for active business income.--The
amount of the credit determined under paragraph (1)(A)
for any taxable year shall not exceed 60 percent of the
aggregate amount of the possession corporation's
qualified possession wages for such taxable year.
``(B) Credit for investment income.--
``(i) In general.--If--
``(I) the QPSII assets of the
possession corporation for any taxable
year, exceed
``(II) 80 percent of such
possession corporation's qualified
tangible business investment for such
taxable year,
the credit determined under paragraph (1)(B)
for such taxable year shall be reduced by the
amount determined under clause (ii).
``(ii) Amount of reduction.--The reduction
determined under this clause for any taxable
year is an amount which bears the same ratio to
the credit determined under paragraph (1)(B)
for such taxable year (determined without
regard to this subparagraph) as--
``(I) the excess determined under
clause (i), bears to
``(II) the QPSII assets of the
possession corporation for such taxable
year.
``(C) Cross reference.--
``For definitions and special rules
applicable to this paragraph, see subsection (i).''
(b) Definitions and Special Rules.--Section 936 is amended by
adding at the end thereof the following new subsection:
``(i) Definitions and Special Rules Relating to Limitations of
Subsection (a)(4).--
``(1) Qualified possession wages.--For purposes of this
section--
``(A) In general.--The term `qualified possession
wages' means wages paid or incurred by the possession
corporation during the taxable year to any employee for
services performed in a possession of the United
States, but only if such services are performed while
the principal place of employment of such employee is
within such possession.
``(B) Limitation on amount of wages taken into
account.--
``(i) In general.--The amount of wages
which may be taken into account under
subparagraph (A) with respect to any employee
for any taxable year shall not exceed the
contribution and benefit base determined under
section 230 of the Social Security Act for the
calendar year in which such taxable year
begins.
``(ii) Treatment of part-time employees,
etc.--If--
``(I) any employee is not employed
by the possession corporation on a
substantially full-time basis at all
times during the taxable year, or
``(II) the principal place of
employment of any employee with the
possession corporation is not within a
possession at all times during the
taxable year,
the limitation applicable under clause (i) with
respect to such employee shall be the
appropriate portion (as determined by the
Secretary) of the limitation which would
otherwise be in effect under clause (i).
``(C) Treatment of certain employees.--The term
`qualified possession wages' shall not include any
wages paid to employees who are assigned by the
employer to perform services for another person, unless
the principal trade or business of the employer is to
make employees available for temporary periods to other
persons in return for compensation. All possession
corporations treated as 1 corporation under paragraph
(4) shall be treated as 1 employer for purposes of the
preceding sentence.
``(D) Wages.--
``(i) In general.--Except as provided in
clause (ii), the term `wages' has the meaning
given to such term by subsection (b) of section
3306 (determined without regard to any dollar
limitation contained in such section). For
purposes of the preceding sentence, such
subsection (b) shall be applied as if the term
`United States' included all possessions of the
United States.
``(ii) Special rule for agricultural labor
and railway labor.--In any case to which
subparagraph (A) or (B) of paragraph (1) of
section 51(h) applies, the term `wages' has the
meaning given to such term by section 51(h)(2).
``(2) QPSII assets.--For purposes of this section--
``(A) In general.--The QPSII assets of a possession
corporation for any taxable year is the average of the
amounts of the possession corporation's qualified
investment assets as of the close of each quarter of
such taxable year.
``(B) Qualified investment assets.--The term
`qualified investment assets' means the aggregate
adjusted bases of the assets which are held by the
possession corporation and the income from which
qualifies as qualified possession source investment
income. For purposes of the preceding sentence, the
adjusted basis of any asset shall be its adjusted basis
as determined for purposes of computing earnings and
profits.
``(3) Qualified tangible business investment.--For purposes
of this section--
``(A) In general.--The qualified tangible business
investment of any possession corporation for any
taxable year is the average of the amounts of the
possession corporation's qualified possession
investments as of the close of each quarter of such
taxable year.
``(B) Qualified possession investments.--The term
`qualified possession investments' means the aggregate
adjusted bases of tangible property used by the
possession corporation in a possession of the United
States in the active conduct of a trade or business
within such possession. For purposes of the preceding
sentence, the adjusted basis of any property shall be
its adjusted basis as determined for purposes of
computing earnings and profits.
``(4) Relocated businesses.--
``(A) In general.--In determining--
``(i) the possession corporation's
qualified possession wages for any taxable
year, and
``(ii) the possession corporation's
qualified tangible business investment for such
taxable year,
there shall be excluded all wages and all qualified
possession investments which are allocable to a
disqualified relocated business.
``(B) Disqualified relocated business.--For
purposes of subparagraph (A), the term `disqualified
relocated business' means any trade or business
commenced by the possession corporation after May 13,
1993, or any addition after such date to an existing
trade or business of such possession corporation
unless--
``(i) the possession corporation certifies
that the commencement of such trade or business
or such addition will not result in a decrease
in employment at an existing business operation
located in the United States, and
``(ii) there is no reason to believe that
such commencement or addition was done with the
intention of closing down operations of an
existing business located in the United States.
``(5) Election to compute credit on consolidated basis.--
``(A) In general.--Any affiliated group may elect
to treat all possession corporations which would be
members of such group but for section 1504(b)(4) as 1
corporation for purposes of this section. The credit
determined under this section with respect to such 1
corporation shall be allocated among such possession
corporations in such manner as the Secretary may
prescribe.
``(B) Election.--An election under subparagraph (A)
shall apply to the taxable year for which made and all
succeeding taxable years unless revoked with the
consent of the Secretary.
``(6) Treatment of certain taxes.--Notwithstanding
subsection (c), if--
``(A) the credit determined under subsection (a)(1)
for any taxable year is limited under subsection
(a)(4), and
``(B) the possession corporation has paid or
accrued any taxes of a possession of the United States
for such taxable year which are treated as not being
income, war profits, or excess profits taxes paid or
accrued to a possession of the United States by reason
of subsection (c),
such possession corporation shall be allowed a deduction for
such taxable year equal to the portion of such taxes which are
allocable (on a pro rata basis) to taxable income of the
possession corporation the tax on which is not offset by reason
of the limitations of subsection (a)(4). In determining the
credit under subsection (a) and in applying the preceding
sentence, taxable income shall be determined without regard to
the preceding sentence.
``(7) Possession corporation.--The term `possession
corporation' means a domestic corporation for which the
election provided in subsection (a) is in effect.
``(8) Transitional rule.--If any possession corporation
elects the benefits of this paragraph for any taxable year
beginning in 1994 or 1995--
``(A) subsection (a)(4) shall not apply to such
taxable year, and
``(B) the credit determined under subsection (a)(1)
for such taxable year shall be the following percentage
of the credit which would otherwise have been
determined under such subsection:
``(i) 80 percent in the case of a taxable
year beginning in 1994.
``(ii) 60 percent in the case of a taxable
year beginning in 1995.
A possession corporation which elects the benefits of
this paragraph shall be entitled to the benefits of
paragraph (6) for taxes allocable to taxable income the
tax on which is not offset by reason of this
paragraph.''
(c) Minimum Tax Treatment.--
(1) In general.--Clause (ii) of section 56(g)(4)(C)
(relating to treatment of special rule for certain dividends)
is amended by striking ``sections 936 and 921'' and inserting
``sections 936 (including subsection (a)(4) thereof) and 921''.
(2) Treatment of foreign taxes.--Clause (iii) of section
56(g)(4)(C) is amended by adding at the end thereof the
following subclauses:
``(IV) Separate application of
foreign tax credit limitations.--In
determining the alternative minimum
foreign tax credit, section 904(d)
shall be applied as if dividends from a
corporation eligible for the credit
provided by section 936 were a separate
category of income referred to in a
subparagraph of section 904(d)(1).
``(V) Coordination with limitation
on 936 credit.--Any reference in this
clause to a dividend received from a
corporation eligible for the credit
provided by section 936 shall be
treated as a reference to the portion
of any such dividend for which the
dividends received deduction is
disallowed under clause (i) after the
application of clause (ii)(I).''
(d) Conforming Amendment.--Paragraph (4) of section 904(b) is
amended by inserting before the period at the end thereof the
following: ``(without regard to subsection (a)(4) thereof)''.
(e) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
SEC. 14227. MODIFICATION TO LIMITATION ON DEDUCTION FOR CERTAIN
INTEREST.
(a) General Rule.--Paragraph (3) of section 163(j) (defining
disqualified interest) is amended to read as follows:
``(3) Disqualified interest.--For purposes of this
subsection, the term `disqualified interest' means--
``(A) any interest paid or accrued by the taxpayer
(directly or indirectly) to a related person if no tax
is imposed by this subtitle with respect to such
interest, and
``(B) any interest paid or accrued by the taxpayer
with respect to any indebtedness to a person who is not
a related person if--
``(i) there is a disqualified guarantee of
such indebtedness, and
``(ii) no gross basis tax is imposed by
this subtitle with respect to such interest.''
(b) Definitions.--Paragraph (6) of section 163(j) is amended by
adding at the end thereof the following new subparagraphs:
``(D) Disqualified guarantee.--
``(i) In general.--Except as provided in
clause (ii), the term `disqualified guarantee'
means any guarantee by a related person which
is--
``(I) an organization exempt from
taxation under this subtitle, or
``(II) a foreign person.
``(ii) Exceptions.--The term `disqualified
guarantee' shall not include a guarantee--
``(I) in any circumstances
identified by the Secretary by
regulation, where the interest on the
indebtedness would have been subject to
a net basis tax if the interest had
been paid to the guarantor, or
``(II) if the taxpayer owns a
controlling interest in the guarantor.
For purposes of subclause (II), except as
provided in regulations, the term `a
controlling interest' means direct or indirect
ownership of at least 80 percent of the total
voting power and value of all classes of stock
of a corporation, or 80 percent of the profit
and capital interests in any other entity. For
purposes of the preceding sentence, the rules
of paragraphs (1) and (5) of section 267(c)
shall apply; except that such rules shall also
apply to interest in entities other than
corporations.
``(iii) Guarantee.--Except as provided in
regulations, the term `guarantee' includes any
arrangement under which a person (directly or
indirectly through an entity or otherwise)
assures, on a conditional or unconditional
basis, the payment of another person's
obligation under any indebtedness.
``(E) Gross basis and net basis taxation.--
``(i) Gross basis tax.--The term `gross
basis tax' means any tax imposed by this
subtitle which is determined by reference to
the gross amount of any item of income without
any reduction for any deduction allowed by this
subtitle.
``(ii) Net basis tax.--The term `net basis
tax' means any tax imposed by this subtitle
which is a not a gross basis tax.''
(c) Conforming Amendment.--Subparagraph (B) of section 163(j)(5) is
amended by striking ``to a related person''.
(d) Effective Date.--The amendments made by this section shall
apply to interest paid or accrued in taxable years beginning after
December 31, 1993.
PART III--FOREIGN TAX PROVISIONS
Subpart A--Current Taxation of Certain Earnings of Controlled Foreign
Corporations
SEC. 14231. EARNINGS INVESTED IN EXCESS PASSIVE ASSETS.
(a) General Rule.--Paragraph (1) of section 951(a) (relating to
amounts included in gross income of United States shareholders) is
amended by striking ``and'' at the end of subparagraph (A), by striking
the period at the end of subparagraph (B) and inserting ``; and'', and
by adding at the end thereof the following new subparagraph:
``(C) the amount determined under section 956A with
respect to such shareholder for such year (but only to
the extent not excluded from gross income under section
959(a)(3)).''
(b) Amount of Inclusion.--Subpart F of part III of subchapter N of
chapter 1 is amended by inserting after section 956 the following new
section:
``SEC. 956A. EARNINGS INVESTED IN EXCESS PASSIVE ASSETS.
``(a) General Rule.--In the case of any controlled foreign
corporation, the amount determined under this section with respect to
any United States shareholder for any taxable year is the lesser of--
``(1) the excess (if any) of--
``(A) such shareholder's pro rata share of the
amount of the controlled foreign corporation's excess
passive assets for such taxable year, over
``(B) the amount of earnings and profits described
in section 959(c)(1)(B) with respect to such
shareholder, or
``(2) such shareholder's pro rata share of the applicable
earnings of such controlled foreign corporation determined
after the application of section 951(a)(1)(B).
``(b) Applicable Earnings.--For purposes of this section, the term
`applicable earnings' means, with respect to any controlled foreign
corporation, the amounts referred to in sections 316(a)(1) and
316(a)(2) (but reduced by distributions made during the taxable year),
reduced by the earnings and profits described in section 959(c)(1).
``(c) Excess Passive Assets.--For purposes of this section--
``(1) In general.--The excess passive assets of any
controlled foreign corporation for any taxable year is the
excess (if any) of--
``(A) the average of the amounts of passive assets
held by such corporation as of the close of each
quarter of such taxable year, over
``(B) 25 percent of the average of the amounts of
total assets held by such corporation as of the close
of each quarter of such taxable year.
For purposes of the preceding sentence, the amount taken into
account with respect to any asset shall be its adjusted basis
as determined for purposes of computing earnings and profits.
``(2) Passive asset.--
``(A) In general.--Except as otherwise provided in
this section, the term `passive asset' means any asset
held by the controlled foreign corporation which
produces passive income (as defined in section 1296(b))
or is held for the production of such income.
``(B) Coordination with section 956.--The term
`passive asset' shall not include any United States
property (as defined in section 956).
``(3) Look-thru rules made applicable.--For purposes of
this subsection, the rules of section 1296(c) shall apply.
``(4) Leasing rules made applicable.--For purposes of this
subsection, the rules of section 1297(d) shall apply.
``(d) Special Rule Where Corporation Ceases To Be Controlled
Foreign Corporation During Taxable Year.--If any foreign corporation
ceases to be a controlled foreign corporation during any taxable year--
``(1) the determination of any United States shareholder's
pro rata share shall be made on the basis of stock owned
(within the meaning of section 958(a)) by such shareholder on
the last day during the taxable year on which the foreign
corporation is a controlled foreign corporation, and
``(2) the amount of such corporation's excess passive
assets for such taxable year shall be determined by only taking
into account quarters ending on or before such last day, and
``(3) in determining applicable earnings, the amount taken
into account by reason of being described in paragraph (2) of
section 316(a) shall be the portion of the amount so described
which is allocable (on a pro rata basis) to the part of such
year during which the corporation is a controlled foreign
corporation.
``(e) Transition Rule.--In the case of any taxable year of a
controlled foreign corporation beginning after September 30, 1993, and
before October 1, 1997, the amount determined under subsection (a)
shall be the applicable percentage (determined under the following
table) of the amount which would otherwise be determined under such
subsection:
``In the case of a taxable year
beginning during the 1-year period
The applicable
beginning on:
percentage is:
October 1, 1993............................... 20
October 1, 1994............................... 25
October 1, 1995............................... 35
October 1, 1996............................... 50.
``(f) Regulations.--The Secretary shall prescribe such regulations
as may be necessary to carry out the purposes of this section,
including regulations to prevent the avoidance of the provisions of
this section through reorganizations or otherwise.''
(c) Previously Taxed Income Rules.--
(1) In general.--Subsection (a) of section 959 (relating to
exclusion from gross income of previously taxed earnings and
profits) is amended by striking ``or'' at the end of paragraph
(1), by adding ``or'' at the end of paragraph (2), and by
inserting after paragraph (2) the following new paragraph:
``(3) such amounts would, but for this subsection, be
included under section 951(a)(1)(C) in the gross income of,''.
(2) Allocation rules.--
(A) Subsection (a) of section 959 is amended by
adding at the end thereof the following new sentence:
``The rules of subsection (c) shall apply for purposes
of paragraph (1) of this subsection and the rules of
subsection (f) shall apply for purposes of paragraphs
(2) and (3) of this subsection.''.
(B) Section 959 is amended by adding at the end
thereof the following new subsection:
``(f) Allocation Rules for Certain Inclusions.--
``(1) In general.--For purposes of this section, amounts
that would be included under subparagraph (B) or (C) of section
951(a)(1) (determined without regard to this section) shall be
treated as attributable first to earnings described in
subsection (c)(2), and then to earnings described in subsection
(c)(3).
``(2) Treatment of distributions.--In applying this
section, actual distributions shall be taken into account
before amounts that would be included under subparagraphs (B)
and (C) of section 951(a)(1) (determined without regard to this
section).''
(C) Paragraph (1) of section 959(c) is amended to
read as follows:
``(1) first to the aggregate of--
``(A) earnings and profits attributable to amounts
included in gross income under section 951(a)(1)(B) (or
which would have been included except for subsection
(a)(2) of this section), and
``(B) earnings and profits attributable to amounts
included in gross income under section 951(a)(1)(C) (or
which would have been included except for subsection
(a)(3) of this section),
with any distribution being allocated between earnings and
profits described in subparagraph (A) and earnings and profits
described in subparagraph (B) proportionately on the basis of
the respective amounts of such earnings and profits,''.
(3) Conforming amendments.--
(A) Subsections (a) and (b) of section 959 are each
amended by striking ``earnings and profits for a
taxable year'' and inserting ``earnings and profits''.
(B) Paragraph (2) of section 959(c) is amended to
read as follows:
``(2) then to earnings and profits attributable to amounts
included in gross income under section 951(a)(1)(A) (but
reduced by amounts not included under subparagraph (B) or (C)
of section 951(a)(1) because of the exclusions in paragraphs
(2) and (3) of subsection (a) of this section), and''
(C) Subsection (b) of section 989 is amended by
striking ``section 951(a)(1)(B)'' and inserting
``subparagraph (B) or (C) of section 951(a)(1)''.
(d) Modifications to Passive Foreign Investment Company Rules.--
(1) Adjusted basis used in certain determinations.--
Subsection (a) of section 1296 is amended by striking the
material following paragraph (2) and inserting the following:
``In the case of a controlled foreign corporation (or any other foreign
corporation if such corporation so elects), the determination under
paragraph (2) shall be based on the adjusted bases (as determined for
purposes of computing earnings and profits) of its assets in lieu of
their value. Such an election, once made, may be revoked only with the
consent of the Secretary.''
(2) Treatment of certain subpart f inclusions.--Subsection
(b) of section 1297 is amended by adding at the end thereof the
following new paragraph:
``(9) Treatment of certain subpart f inclusions.--Any
amount included in gross income under subparagraph (B) or (C)
of section 951(a)(1) shall be treated as a distribution
received with respect to the stock.''
(3) Treatment of certain dealers in securities.--Subsection
(b) of section 1296 is amended by adding at the end thereof the
following new paragraph:
``(3) Treatment of certain dealers in securities.--
``(A) In general.--In the case of any foreign
corporation which is a controlled foreign corporation
(as defined in section 957(a)), the term `passive
income' does not include any income derived in the
active conduct of a securities business by such
corporation if such corporation is registered as a
securities broker or dealer under section 15(a) of the
Securities Exchange Act of 1934 or is registered as a
Government securities broker or dealer under section
15C(a) of such Act. To the extent provided in
regulations, such term shall not include any income
derived in the active conduct of a securities business
by a controlled foreign corporation which is not so
registered.
``(B) Application of look-thru rules.--For purposes
of paragraph (2)(C), rules similar to the rules of
subparagraph (A) shall apply in determining whether any
income of a related person (whether or not a
corporation) is passive income.
``(C) Limitation.--The preceding provisions of this
paragraph shall only apply in the case of persons who
are United States shareholders (as defined in section
951(b)) in the controlled foreign corporation.''
(4) Leasing rules.--Section 1297 is amended by
redesignating subsection (d) as subsection (e) and by inserting
after subsection (c) the following new subsection:
``(d) Treatment of Certain Leased Property.--For purposes of this
part:
``(1) In general.--Any tangible personal property with
respect to which a foreign corporation is the lessee under a
lease with a term of at least 12 months shall be treated as an
asset actually held by such corporation.
``(2) Determination of adjusted basis.--
``(A) In general.--The adjusted basis of any asset
to which paragraph (1) applies shall be the unamortized
portion (as determined under regulations prescribed by
the Secretary) of the present value of the payments
under the lease for the use of such property.
``(B) Present value.--For purposes of subparagraph
(A), the present value of payments described in
subparagraph (A) shall be determined in the manner
provided in regulations prescribed by the Secretary--
``(i) as of the beginning of the lease
term, and
``(ii) except as provided in such
regulations, by using a discount rate equal to
the applicable Federal rate determined under
section 1274(d)--
``(I) by substituting the lease
term for the term of the debt
instrument, and
``(II) without regard to paragraph
(2) or (3) thereof.
``(3) Exceptions.--This subsection shall not apply in any
case where--
``(A) the lessor is a related person (as defined in
section 954(d)(3)) with respect to the foreign
corporation, or
``(B) a principal purpose of leasing the property
was to avoid the provisions of this section.''
(e) Effective Date.--The amendments made by this section shall
apply to taxable years of foreign corporations beginning after
September 30, 1993, and to taxable years of United States shareholders
in which or with which such taxable years of foreign corporations end.
SEC. 14232. MODIFICATION TO TAXATION OF INVESTMENT IN UNITED STATES
PROPERTY.
(a) General Rule.--Section 956 (relating to investment of earnings
in United States property) is amended--
(1) by redesignating subsections (b) and (c) as subsections
(c) and (d), respectively, and
(2) by striking subsection (a) and inserting the following:
``(a) General Rule.--In the case of any controlled foreign
corporation, the amount determined under this section with respect to
any United States shareholder for any taxable year is the lesser of--
``(1) the excess (if any) of--
``(A) such shareholder's pro rata share of the
average of the amounts of United States property held
(directly or indirectly) by the controlled foreign
corporation as of the close of each quarter of such
taxable year, over
``(B) the amount of earnings and profits described
in section 959(c)(1)(A) with respect to such
shareholder, or
``(2) such shareholder's pro rata share of the applicable
earnings of such controlled foreign corporation.
The amount taken into account under paragraph (1) with respect to any
property shall be its adjusted basis as determined for purposes of
computing earnings and profits, reduced by any liability to which the
property is subject.
``(b) Adjustments for Certain Distributions; Other Special Rules.--
``(1) Applicable earnings.--For purposes of this section,
the term `applicable earnings' has the meaning given to such
term by section 956A(b).
``(2) Special rule where corporation ceases to be
controlled foreign corporation.--Rules similar to the rules of
section 956A(d) shall apply for purposes of this section.''
(b) Conforming Amendments.--
(1) Subparagraph (B) of section 951(a)(1) is amended to
read as follows:
``(B) the amount determined under section 956 with
respect to such shareholder for such year (but only to
the extent not excluded from gross income under section
959(a)(2)); and''
(2) Subsection (a) of section 951 is amended by striking
paragraph (4).
(c) Effective Date.--The amendments made by this section shall
apply to taxable years of controlled foreign corporations beginning
after September 30, 1993, and to taxable years of United States
shareholders in which or with which such taxable years of controlled
foreign corporations end.
(d) Study of Investments by Controlled Foreign Corporations in
United States Property.--
(1) In general.--The Secretary of the Treasury shall
conduct a study of the tax treatment of investments by
controlled foreign corporations in obligations of United States
persons other than corporations. Such study shall include the
Secretary's views as to whether the treatment of such
investments should be changed, along with a discussion of the
merits and consequences of any such change.
(2) Report.--Not later than December 31, 1993, the
Secretary of the Treasury shall submit to the Committee on Ways
and Means of the House of Representatives and the Committee on
Finance of the Senate a report on the study conducted under
this subsection, together with such recommendations as he may
deem advisable.
SEC. 14233. OTHER MODIFICATIONS TO SUBPART F.
(a) Same Country Exception Not To Apply to Certain Dividends.--
(1) In general.--Paragraph (3) of section 954(c) (relating
to certain income received from related persons) is amended by
adding at the end thereof the following new subparagraph:
``(C) Exception for certain dividends.--
Subparagraph (A)(i) shall not apply to any dividend
with respect to any stock which is attributable to
earnings and profits of the distributing corporation
accumulated during any period during which the person
receiving such dividend did not hold such stock.''
(2) Effective date.--The amendment made by paragraph (1)
shall apply to taxable years of controlled foreign corporations
beginning after September 30, 1993, and to taxable years of
United States shareholders in which or with which such taxable
years of controlled foreign corporations end.
(b) Simplification of Section 960(b).--
(1) In general.--Subsection (b) of section 960 is amended--
(A) by redesignating paragraphs (3) and (4) as
paragraphs (4) and (5), respectively, and
(B) by striking paragraphs (1) and (2) and
inserting the following new paragraphs:
``(1) Increase in section 904 limitation.--In the case of
any taxpayer who--
``(A) either (i) chose to have the benefits of
subpart A of this part for a taxable year beginning
after September 30, 1993, in which he was required
under section 951(a) to include any amount in his gross
income, or (ii) did not pay or accrue for such taxable
year any income, war profits, or excess profits taxes
to any foreign country or to any possession of the
United States,
``(B) chooses to have the benefits of subpart A of
this part for any taxable year in which he receives 1
or more distributions or amounts which are excludable
from gross income under section 959(a) and which are
attributable to amounts included in his gross income
for taxable years referred to in subparagraph (A), and
``(C) for the taxable year in which such
distributions or amounts are received, pays, or is
deemed to have paid, or accrues income, war profits, or
excess profits taxes to a foreign country or to any
possession of the United States with respect to such
distributions or amounts,
the limitation under section 904 for the taxable year in which
such distributions or amounts are received shall be increased
by the lesser of the amount of such taxes paid, or deemed paid,
or accrued with respect to such distributions or amounts or the
amount in the excess limitation account as of the beginning of
such taxable year.
``(2) Excess limitation account.--
``(A) Establishment of account.--Each taxpayer
meeting the requirements of paragraph (1)(A) shall
establish an excess limitation account. The opening
balance of such account shall be zero.
``(B) Increases in account.--For each taxable year
beginning after September 30, 1993, the taxpayer shall
increase the amount in the excess limitation account by
the excess (if any) of--
``(i) the amount by which the limitation
under section 904(a) for such taxable year was
increased by reason of the total amount of the
inclusions in gross income under section 951(a)
for such taxable year, over
``(ii) the amount of any income, war
profits, and excess profits taxes paid, or
deemed paid, or accrued to any foreign country
or possession of the United States which were
allowable as a credit under section 901 for
such taxable year and which would not have been
allowable but for the inclusions in gross
income described in clause (i).
Proper reductions in the amount added to the account
under the preceding sentence for any taxable year shall
be made for any increase in the credit allowable under
section 901 for such taxable year by reason of a
carryback if such increase would not have been
allowable but for the inclusions in gross income
described in clause (i).
``(C) Decreases in account.--For each taxable year
beginning after September 30, 1993, for which the
limitation under section 904 was increased under
paragraph (1), the taxpayer shall reduce the amount in
the excess limitation account by the amount of such
increase.
``(3) Distributions of income previously taxed in years
beginning before october 1, 1993.--If the taxpayer receives a
distribution or amount in a taxable year beginning after
September 30, 1993, which is excluded from gross income under
section 959(a) and is attributable to any amount included in
gross income under section 951(a) for a taxable year beginning
before October 1, 1993, the limitation under section 904 for
the taxable year in which such amount or distribution is
received shall be increased by the amount determined under this
subsection as in effect on the day before the date of the
enactment of the Revenue Reconcilation Act of 1993.''
(2) Effective date.--The amendment made by paragraph (1)
shall apply to taxable years beginning after September 30,
1993.
Subpart B--Allocation of Research and Experimental Expenditures
SEC. 14234. ALLOCATION OF RESEARCH AND EXPERIMENTAL EXPENDITURES.
(a) General Rule.--Subparagraph (B) of section 864(f)(1) (relating
to allocation of research and experimental expenditures) is amended by
striking ``64 percent'' each place it appears and inserting ``50
percent''.
(b) Conforming Amendments.--
(1) Subsection (f) of section 864 is amended by striking
paragraph (5) and inserting the following:
``(5) Regulations.--The Secretary shall prescribe such
regulations as may be appropriate to carry out the purposes of
this subsection, including regulations relating to the
determination of whether any expenses are attributable to
activities conducted in the United States or outside the United
States and regulations providing such adjustments to the
provisions of this subsection as may be appropriate in the case
of cost-sharing arrangements and contract research.''
(2) Subparagraph (D) of section 864(f)(4) is amended by
striking ``subparagraph (C)'' and inserting ``subparagraph (B)
or (C)''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years ending after the date of the enactment of this
Act; except that such amendments shall not apply in the case of any
taxable year to which Revenue Procedure 92-56 applies or would apply if
the taxpayer elected the benefits of such Revenue Procedure.
Subpart C--Other Provisions
SEC. 14235. REPEAL OF CERTAIN EXCEPTIONS FOR WORKING CAPITAL.
(a) Provisions Relating to Oil and Gas Income.--
(1) Amendments to section 907.--
(A) Paragraph (1) of section 907(c) is amended by
adding at the end thereof the following new flush
sentence:
``Such term does not include any dividend or interest income which is
passive income (as defined in section 904(d)(2)(A)).''.
(B) Paragraph (2) of section 907(c) is amended by
adding at the end thereof the following new flush
sentence:
``Such term does not include any dividend or interest income which is
passive income (as defined in section 904(d)(2)(A)).''.
(2) Separate application of foreign tax credit.--Clause
(iii) of section 904(d)(2)(A) is amended by inserting ``and''
at the end of subclause (II), by striking ``, and'' at the end
of subclause (III) and inserting a period, and by striking
subclause (IV).
(3) Treatment under subpart f.--
(A) Paragraph (1) of section 954(g) is amended by
adding at the end thereof the following new flush
sentence:
Such term shall not include any foreign personal holding company income
(as defined in subsection (c)).''.
(B) Paragraph (8) of section 954(b) is amended by
striking ``(1),''.
(b) Treatment of Shipping Income.--Subsection (f) of section 954 is
amended by adding at the end thereof the following new sentence: ``Such
term shall not include any dividend or interest income which is foreign
personal holding company income (as defined in subsection (c)).''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1992.
SEC. 14236. MODIFICATIONS OF ACCURACY-RELATED PENALTY.
(a) Threshold Requirement.--Clause (ii) of section 6662(e)(1)(B)
(relating to substantial valuation misstatement under chapter 1) is
amended to read as follows:
``(ii) the net section 482 transfer price
adjustment for the taxable year exceeds the
lesser of $5,000,000 or 10 percent of the
taxpayer's gross receipts.''
(b) Certain Adjustments Excluded in Determining Threshold.--
Subparagraph (B) of section 6662(e)(3) is amended to read as follows:
``(B) Certain adjustments excluded in determining
threshold.--For purposes of determining whether the
threshold requirements of paragraph (1)(B)(ii) are met,
the following shall be excluded:
``(i) Any portion of the net increase in
taxable income referred to in subparagraph (A)
which is attributable to any redetermination of
a price if--
``(I) it is established that the
taxpayer determined such price in
accordance with a specific pricing
method set forth in the regulations
prescribed under section 482 and that
the taxpayer's use of such method was
reasonable,
``(II) the taxpayer has
documentation (which was in existence
as of the time of filing the return)
which sets forth the determination of
such price in accordance with such a
method and which establishes that the
use of such method was reasonable, and
``(III) the taxpayer provides such
documentation to the Secretary within
30 days of a request for such
documentation.
``(ii) Any portion of the net increase in
taxable income referred to in subparagraph (A)
which is attributable to a redetermination of
price where such price was not determined in
accordance with such a specific pricing method
if--
``(I) the taxpayer establishes that
none of such pricing methods was likely
to result in a price that would clearly
reflect income, the taxpayer used
another pricing method to determine
such price, and such other pricing
method was likely to result in a price
that would clearly reflect income,
``(II) the taxpayer has
documentation (which was in existence
as of the time of filing the return)
which sets forth the determination of
such price in accordance with such
other method and which establishes that
the requirements of subclause (I) were
satisfied, and
``(III) the taxpayer provides such
documentation to the Secretary within
30 days of request for such
documentation.
``(iii) Any portion of such net increase
which is attributable to any transaction solely
between foreign corporations unless, in the
case of any such corporations, the treatment of
such transaction affects the determination of
income from sources within the United States or
taxable income effectively connected with the
conduct of a trade or business within the
United States.''
(b) Coordination With Reasonable Cause Exception.--Paragraph (3) of
section 6662(e) is amended by adding at the end thereof the following
new subparagraph:
``(D) Coordination with reasonable cause
exception.--For purposes of section 6664(c) the
taxpayer shall not be treated as having reasonable
cause for any portion of an underpayment attributable
to a net section 482 transfer price adjustment unless
such taxpayer meets the requirements of clause (i),
(ii), or (iii) of subparagraph (B) with respect to such
portion.''
(c) Conforming Amendment.--Clause (iii) of section 6662(h)(2)(A) is
amended to read as follows:
``(iii) in paragraph (1)(B)(ii)--
``(I) `$20,000,000' for
`$5,000,000', and
``(II) `20 percent' for `10
percent'.''
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
SEC. 14237. DENIAL OF PORTFOLIO INTEREST EXEMPTION FOR CONTINGENT
INTEREST.
(a) General Rule.--
(1) Subsection (h) of section 871 (relating to repeal of
tax on interest of nonresident alien individuals received from
certain portfolio debt investments) is amended by redesignating
paragraphs (4), (5), and (6) as paragraphs (5), (6), and (7),
respectively, and by inserting after paragraph (3) the
following new paragraph:
``(4) Portfolio interest not to include certain contingent
interest.--For purposes of this subsection--
``(A) In general.--Except as otherwise provided in
this paragraph, the term `portfolio interest' shall not
include--
``(i) any interest if the amount of such
interest is determined by reference to--
``(I) any receipts, sales or other
cash flow of the debtor or a related
person,
``(II) any income or profits of the
debtor or a related person,
``(III) any change in value of any
property of the debtor or a related
person, or
``(IV) any dividend, partnership
distributions, or similar payments made
by the debtor or a related person, or
``(ii) any other type of contingent
interest that is identified by the Secretary by
regulation, where a denial of the portfolio
interest exemption is necessary or appropriate
to prevent avoidance of Federal income tax.
``(B) Related person.--The term `related person'
means any person who is related to the debtor within
the meaning of section 267(b) or 707(b)(1), or who is a
party to any arrangement undertaken for a purpose of
avoiding the application of this paragraph.
``(C) Exceptions.--Subparagraph (A)(i) shall not
apply to--
``(i) any amount of interest solely by
reason of the fact that the timing of any
interest or principal payment is subject to a
contingency,
``(ii) any amount of interest solely by
reason of the fact that the interest is paid
with respect to nonrecourse or limited recourse
indebtedness,
``(iii) any amount of interest all or
substantially all of which is determined by
reference to any other amount of interest not
described in subparagraph (A) (or by reference
to the principal amount of indebtedness on
which such other interest is paid),
``(iv) any amount of interest solely by
reason of the fact that the debtor or a related
person enters into a hedging transaction to
reduce the risk of interest rate or currency
fluctuations with respect to such interest,
``(v) any amount of interest determined by
reference to--
``(I) changes in the value of
property (including stock) that is
actively traded (within the meaning of
section 1092(d)) other than property
described in section 897(c)(1) or (g),
``(II) the yield on property
described in subclause (I), other than
a debt instrument that pays interest
described in subparagraph (A), or stock
or other property that represents a
beneficial interest in the debtor or a
related person, or
``(III) changes in any index of the
value of property described in
subclause (I) or of the yield on
property described in subclause (II),
and
``(vi) any other type of interest
identified by the Secretary by regulation.
``(D) Exception for certain existing
indebtedness.--Subparagraph (A) shall not apply to any
interest paid or accrued with respect to any
indebtedness with a fixed term--
``(i) which was issued on or before April
7, 1993, or
``(ii) which was issued after such date
pursuant to a written binding contract in
effect on such date and at all times thereafter
before such indebtedness was issued.''
(2) Subsection (c) of section 881 is amended by
redesignating paragraphs (4), (5), and (6) as paragraphs (5),
(6), and (7), respectively, and by inserting after paragraph
(3) the following new paragraph:
``(4) Portfolio interest not to include certain contingent
interest.--For purposes of this subsection, the term `portfolio
interest' shall not include any interest which is treated as
not being portfolio interest under the rules of section
871(h)(4).''
(b) Conforming Amendments.--
(1) Clause (ii) of section 871(h)(2)(B) is amended by
striking ``paragraph (4)'' and inserting ``paragraph (5)''.
(2) Clause (ii) of section 881(c)(2)(B) is amended by
striking ``section 871(h)(4)'' and inserting ``section
871(h)(5)''.
(3) Paragraph (6) of section 881(c) (as redesignated by
subsection (a)) is amended by striking ``section 871(h)(5)''
each place it appears and inserting ``section 871(h)(6)''.
(4) Paragraph (9) of section 1441(c) is amended by striking
``section 871(h)(3)'' and inserting ``section 871(h)(3) or
(4)''.
(5) Subsection (a) of section 1442 is amended--
(A) by striking ``871(h)(3)'' and inserting
``871(h)(3) or (4)'', and
(B) by striking ``881(c)(3)'' and inserting
``881(c)(3) or (4)''.
(c) Effective Date.--The amendments made by this section shall
apply to interest received after December 31, 1993.
SEC. 14238. REGULATIONS DEALING WITH CONDUIT ARRANGEMENTS.
Section 7701 is amended by redesignating subsection (l) as
subsection (m) and by inserting after subsection (k) the following new
subsection:
``(l) Regulations Relating to Conduit Arrangements.--The Secretary
may prescribe regulations recharacterizing any multiple-party financing
transaction as a transaction directly among any 2 or more of such
parties where the Secretary determines that such recharacterization is
appropriate to prevent avoidance of any tax imposed by this title.''
PART IV--ENERGY TAX PROVISIONS
Subpart A--Energy Tax Based on Btu Content
SEC. 14241. IMPOSITION OF ENERGY TAX BASED ON BTU CONTENT.
(a) In General.--Chapter 36 (relating to other excise taxes) is
amended by redesignating subchapters A and B as subchapters B and C,
respectively, and by inserting before subchapter B (as so redesignated)
the following new subchapter:
``Subchapter A--Energy Taxes
``Part I. Imposition of tax on refined
petroleum products.
``Part II. Imposition of taxes on natural
gas, coal, and electricity.
``Part III. Tax rates.
``Part IV. Use taxes; floor stocks taxes;
administrative provisions;
definitions and special rules.
``Part V. Tax on imported products with
high embedded energy costs.
``PART I--IMPOSITION OF TAX ON REFINED PETROLEUM PRODUCTS
``Sec. 4441. Taxable refined petroleum
products.
``Sec. 4442. Tax-free transfers and uses;
refunds for certain sales and
uses.
``SEC. 4441. TAXABLE REFINED PETROLEUM PRODUCTS.
``(a) Imposition of Tax.--
``(1) In general.--There is hereby imposed a tax on any
taxable refined petroleum product--
``(A) removed from any refinery in the United
States,
``(B) removed from any terminal in the United
States,
``(C) entered into the United States for
consumption, use, or warehousing, and
``(D) sold to any person who is not registered
under section 4453(d).
No tax shall be imposed by subparagraph (D) if there was a
prior taxable removal or entry under subparagraph (A), (B), or
(C).
``(2) Exception for bulk transfers to registered refineries
or terminals.--The tax imposed by paragraph (1) shall not apply
to any removal or entry of any taxable refined petroleum
product transferred in bulk to a refinery or terminal if the
person removing or entering such product and the operator of
such refinery or terminal are registered under section 4453(d).
``(b) Rate of Tax.--
``(1) In general.--The amount of the tax imposed by
subsection (a) on each barrel of any taxable refined petroleum
product shall be the sum of--
``(A) the base rate, and
``(B) the supplemental rate,
multiplied by the applicable per unit Btu factor for such
product.
``(2) Only base rate applies to qualified heating oil,
diesel fuel used on farms, and liquefied petroleum gases.--
``(A) In general.--Subparagraph (B) of paragraph
(1) shall not apply to--
``(i) qualified heating oil,
``(ii) qualified farm diesel fuel, and
``(iii) any liquefied petroleum gas.
``(B) Qualified heating oil.--For purposes of
subparagraph (A), the term `qualified heating oil'
means No. 2 distillate fuel oil (including any kerosene
in a mixture with such oil) which--
``(i) is indelibly dyed (or dyed and
marked) in accordance with regulations that the
Secretary shall prescribe, and
``(ii) is delivered (or is to be delivered)
to any building to heat the building.
``(C) Qualified farm diesel fuel.--For purposes of
subparagraph (A), the term `qualified farm diesel fuel'
means any diesel fuel which--
``(i) is indelibly dyed (or dyed and
marked) in accordance with regulations that the
Secretary shall prescribe, and
``(ii) is used (or to be used) on a farm
for farming purposes (determined under section
6420(c)).
``(c) Liability for Tax.--The determination of who is liable for
the tax imposed by subsection (a) shall be made under the rules
applicable in determining liability for the tax imposed by section
4081. Section 4103 shall apply to the tax imposed by subsection (a) in
the same manner as it applies to the tax imposed by section 4081.
``(d) Taxable Refined Petroleum Product.--For purposes of this
subchapter, the term `taxable refined petroleum product' means--
``(1) aviation gasoline,
``(2) motor gasoline (including blending components of
gasoline),
``(3) kerosene-type jet fuel,
``(4) naphtha-type jet fuel,
``(5) distillate fuel oil,
``(6) kerosene,
``(7) residual fuel oil,
``(8) petroleum coke,
``(9) butane,
``(10) propane,
``(11) ethanol,
``(12) methanol, and
``(13) to the extent provided in regulations prescribed by
the Secretary, any other refined petroleum product.
``(e) Applicable Per Unit Btu Factor.--For purposes of this
subchapter--
``(1) In general.--
The applicable per unit
Btu factor is the follow-
``In the case of:
ing amount per barrel:
Aviation gasoline.......... 5.048
Motor gasoline (including 5.267
blending components of
gasoline).
Kerosene-type jet fuel..... 5.670
Naphtha-type jet fuel...... 5.355
Distillate fuel oil........ 5.852
Kerosene................... 5.670
Residual fuel oil.......... 6.486
Petroleum coke............. 6.024
Ethanol.................... 3.500
Methanol................... 3.500
Butane..................... 4.326
Propane.................... 3.836
``(2) Mixtures.--Any mixture which includes a taxable
refined petroleum product shall be treated as specified in
paragraph (1) and--
``(A) if more than 1 such product is included in
such mixture, the applicable per unit Btu factor shall
be the weighted average of the applicable per unit Btu
factors for the taxable refined petroleum products
included in the mixture, and
``(B) if any substance is included in the mixture
which is not a taxable refined petroleum product, the
applicable per unit Btu factor for the portion of such
mixture's volume which is attributable to such
substance shall be zero.
``(3) Cross reference.--
``For authority to adjust per unit Btu
amounts, see section 4453(e).
``(f) Other Definitions.--For purposes of this subchapter--
``(1) Refinery.--The term `refinery' means any facility--
``(A) at which crude oil or any petroleum product
is refined,
``(B) which is a natural gas processing or
fractionation plant, or
``(C) at which ethanol or methanol is produced for
use as a fuel.
``(2) Blending components.--The term `blending components'
does not include ethanol or methanol.
``(3) Ethanol and methanol.--The terms `ethanol' and
`methanol' include ether derivatives of ethanol and methanol,
respectively.
``(4) Barrel.--The term `barrel' means 42 United States
gallons determined with such temperature adjustments as the
Secretary may prescribe. In the case of a taxable refined
petroleum product which is not a liquid, the term `barrel'
means a volume determined under regulations prescribed by the
Secretary on the basis of an equivalence to a barrel of oil.
``(g) Refunds in Certain Cases.--Under regulations prescribed by
the Secretary, if any person who paid the tax imposed by this section
with respect to any taxable refined petroleum product establishes to
the satisfaction of the Secretary that a prior tax was paid (and not
credited or refunded) with respect to such product, then an amount
equal to the tax paid by such person shall be allowed as a refund
(without interest) to such person in the same manner as if it were an
overpayment of tax imposed by this section.
``SEC. 4442. TAX-FREE TRANSFERS AND USES; REFUNDS FOR CERTAIN SALES AND
USES.
``(a) Tax-Free Sales, Etc.--
``(1) In general.--No tax shall be imposed by section
4441--
``(A) on any taxable refined petroleum product
which is used in an exempt use by the person otherwise
liable for such tax, or
``(B) by reason of a removal, entry, or sale of
such product for an exempt use by the person receiving
the product.
``(2) Exempt use.--For purposes of this subsection, the
term `exempt use' means--
``(A) export,
``(B) any use in the generation of electricity,
``(C) any qualified feedstock use, and
``(D) any use in the manufacture or production of
synthetic natural gas or any other synthetic fuel
specified in regulations prescribed by the Secretary.
``(3) Qualified feedstock use.--For purposes of this
subsection--
``(A) In general.--In the case of any qualified
feedstock use, only the exempt percentage of any
taxable refined petroleum product shall be exempt from
tax under paragraph (1).
``(B) Qualified feedstock use.--The term `qualified
feedstock use' means use of any taxable refined
petroleum product in the manufacture or production of
any substance.
``(C) Exempt percentage.--For purposes of
subparagraph (A), the term `exempt percentage' means
the percentage (determined on the basis of chemical
structure) of the taxable refined petroleum product
which is incorporated into the substance manufactured
or produced.
``(4) Registration requirements.--To the extent provided by
the Secretary, paragraph (1) shall not apply to any taxable
event unless--
``(A) such persons with respect to such event as
the Secretary may specify are registered under section
4453(d), and
``(B) in the case of a sale, the purchaser's name
and address, and the purchaser's registration number
for purposes of this subchapter, are provided to the
seller.
``(5) Refunds of products purchased tax-paid.--If tax was
imposed under section 4441 with respect to any taxable refined
petroleum product and such product is used by any person in an
exempt use, the Secretary shall pay to such person an amount
equal to the tax so imposed (or, in the case of a qualified
feedstock use, the exempt percentage of the tax so imposed).
``(6) Cross reference.--
``For tax on fuel used to produce steam
at facility which also generates electricity, see section 4451(e).
``(b) Refunds to Ultimate Vendors in Certain Cases.--Under
regulations prescribed by the Secretary--
``(1) Heating oil.--If the supplemental rate of tax was
imposed under section 4441 with respect to any No. 2 distillate
fuel oil (including any kerosene in a mixture with such oil)
and such fuel oil is delivered to any building to heat the
building, the Secretary shall pay to the ultimate vendor of
such fuel oil an amount equal to the product of the
supplemental rate and the applicable per unit Btu factor per
barrel of the fuel oil (and kerosene) so delivered.
``(2) International commercial transportation.--
``(A) In general.--If tax was imposed under section
4441 with respect to any taxable refined petroleum
product and such product is sold for use or used by the
purchaser for international commercial transportation,
the Secretary shall pay to the ultimate vendor of such
product an amount equal to the tax so imposed.
``(B) International commercial transportation.--For
purposes of subparagraph (A), the term `international
commercial transportation' means transportation in the
trade or business of transporting persons or property
for hire--
``(i) by any vessel actually engaged in
foreign trade or trade between the United
States and any of its possessions, or
``(ii) by aircraft from a point within the
United States to a point outside the United
States and outside the 225-mile zone (as
defined in section 4262(c)(2)).
``(3) Vendor requirements.--A payment may be made under
this subsection to a vendor only if the vendor establishes that
such vendor--
``(A)(i) has not included the tax in the price of
the product, and
``(ii) has not collected the tax from the purchaser
of such product, or
``(B) has agreed to repay the tax to the purchaser.
``(c) Production of Calcined Coke.--If tax was imposed under
section 4441 with respect to any petroleum product and such product is
used by any person to produce calcined coke, the Secretary shall pay to
such person an amount equal to the sum of the base rate and the
supplemental rate for each million Btu's of the actual Btu content of
the coke produced.
``(d) Cross Reference.--
``For refunds of gasoline and diesel
fuel used on farms, see sections 6420(a) and 6427(m).
``PART II--IMPOSITION OF TAXES ON NATURAL GAS, COAL, AND ELECTRICITY
``Sec. 4444. Natural gas.
``Sec. 4445. Coal.
``Sec. 4446. Electricity.
``SEC. 4444. NATURAL GAS.
``(a) Imposition of Tax.--
``(1) In general.--There is hereby imposed a tax on natural
gas--
``(A) removed from any pipeline in the United
States,
``(B) entered into the United States for
consumption, use, or warehousing, and
``(C) entered into any pipeline the operator of
which is not registered under section 4453(d).
``(2) Exception for transfers to registered pipelines.--
``(A) Pipeline to pipeline transfers.--The tax
imposed by paragraph (1) shall not apply to any removal
from a pipeline to another pipeline if the operators of
both pipelines are registered under section 4453(d).
``(B) Entry into united states to pipeline
transfers.--The tax imposed by paragraph (1) shall not
apply to any entry into the United States if--
``(i) pursuant to such entry the natural
gas is entered into any pipeline, and
``(ii) the operator of such pipeline is
registered under section 4453(d).
``(b) Rate of Tax.--
``(1) In general.--The amount of the tax imposed by
subsection (a) on each MCF of natural gas shall be the base
rate multiplied by the applicable per unit Btu factor.
``(2) Authority to use actual btu content.--To the extent
provided in regulations prescribed by the Secretary, the amount
of the tax imposed by subsection (a) shall be the base rate for
each million Btu's of the actual Btu content of the natural
gas.
``(c) Liability for, and Collection of, Tax.--
``(1) In general.--The tax imposed by subsection
(a)(1)(A)--
``(A) shall be paid by the person receiving the
natural gas, and
``(B) shall be collected by the operator of the
pipeline.
``(2) Importation.--The tax imposed by subsection (a)(1)(B)
shall be paid by the person entering the natural gas into the
United States for consumption, use, or warehousing.
``(3) Entry into unregistered pipelines.--The tax imposed
by subsection (a)(1)(C) shall be paid by the person entering
the natural gas.
``(4) Collection of tax.--
``(A) In general.--In the case of natural gas
removed from a local distribution system, the operator
shall also be liable for any tax imposed by subsection
(a) which is not collected from the person receiving
the natural gas.
``(B) Exception for large users from local
distribution systems.--Subparagraph (A) shall not apply
to natural gas received by any person during any month
from a local distribution system if the value
(exclusive of taxes) of the natural gas received by
such person from such system during the 12-month period
ending before such month exceeded $3,500,000.
``(d) Definitions.--For purposes of this subchapter--
``(1) Applicable per unit btu factor.--
``(A) In general.--The applicable per unit Btu
factor with respect to natural gas is 1.031 per MCF.
``(B) Cross reference.--
``For authority to adjust per unit Btu
amounts, see section 4453(e).
``(2) Pipeline.--The term `pipeline' includes a local
distribution system. To the extent provided in regulations
prescribed by the Secretary, such term includes a gathering
system.
``(3) Natural gas.--The term `natural gas' includes
synthetic natural gas produced from coal or from any petroleum
product.
``(4) MCF.--The term `MCF' means 1,000 cubic feet of
natural gas measured at a pressure of 14.73 pounds per square
inch (absolute) and a temperature of 60 degrees Fahrenheit.
``(e) Exemption From Tax for Certain Uses.--
``(1) In general.--No tax shall be imposed by subparagraph
(A) or (B) of subsection (a)(1)--
``(A) on any natural gas which is used in an exempt
natural gas use by the person otherwise liable for such
tax, or
``(B) by reason of a removal or entry of natural
gas for an exempt natural gas use by the person
receiving the natural gas.
``(2) Exempt natural gas use.--For purposes of this
subsection, the term `exempt natural gas use' means--
``(A) use in the generation of electricity,
``(B) any qualified feedstock use, or
``(C) use in enhanced heavy oil recovery.
``(3) Qualified feedstock use.--For purposes of this
subsection--
``(A) In general.--In the case of any qualified
feedstock use, only the exempt percentage of the
natural gas shall be exempt from tax under paragraph
(1).
``(B) Qualified feedstock use; exempt percentage.--
The terms `qualified feedstock use' and `exempt
percentage' have the respective meanings given such
terms by section 4442(a)(3) determined by substituting
`natural gas' for `taxable refined petroleum product'
each place it appears.
``(4) Enhanced heavy oil recovery.--For purposes of this
subsection--
``(A) In general.--Natural gas shall be treated as
used in enhanced heavy oil recovery if such gas is used
in an enhanced oil recovery project in the United
States for the recovery of oil having a weighted
average gravity of 20 degrees API or less (corrected to
60 degrees Fahrenheit).
``(B) Enhanced oil recovery project.--For purposes
of subparagraph (A), the term `enhanced oil recovery
project' means any project which involves the
application (in accordance with sound engineering
principles) of 1 or more tertiary recovery methods (as
defined in section 193(b)(3)) which can reasonably be
expected to result in more than an insignificant
increase in the amount of crude oil which will
ultimately be recovered.
``(5) Registration requirements.--To the extent provided by
the Secretary, paragraph (1) shall not apply to any taxable
event unless the requirements of section 4442(a)(4) are met
with respect to such event.
``(6) Refunds of natural gas purchased tax-paid.--If tax
was imposed by this section with respect to any natural gas and
such gas is used by any person in an exempt natural gas use,
the Secretary shall pay to such person an amount equal to the
tax so imposed (or, in the case of a qualified feedstock use,
the exempt percentage of the tax so imposed).
``(7) Cross reference.--
``For tax on fuel used to produce steam
at facility which also generates electricity, see section 4451(e).
``(f) Methane Recovered From Biomass or Coal Mining.--
``(1) In general.--If--
``(A) methane is recovered from biomass or in
conjunction with room and pillar or long wall coal
mining operations, and
``(B) such methane is entered into any natural gas
pipeline,
the Secretary shall pay to the person so entering such methane
an amount equal to the amount of tax which would be imposed
under this section on such methane if such entry were a taxable
event under such section.
``(2) Recapture of credit for methane recovered from coal
mining in certain cases.--
``(A) In general.--If--
``(i) the Secretary has made a payment
under paragraph (1) to any person with respect
to methane recovered from coal mining
operations before the date the actual mining
commences, and
``(ii)(I) such person disposes of his
interest in such coal mining operations, or
``(II) the actual mining commences more
than 10 years after the date such methane was
first recovered,
then the tax under chapter 1 of such person for the
taxable year in which such disposition occurs (or, in a
case to which clause (ii)(II) applies, such 10th year
ends) shall be increased by the aggregate of such
payments to such person plus interest at the
underpayment rate under section 6621 for the periods
beginning on the dates such payments were made.
``(B) No further payments until mining commences.--
If there is an increase in tax under subparagraph (A)
with respect to any payments for methane recovered from
any site, no further payments shall be made under this
subsection with respect to methane recovered from such
site until actual mining commences at such site.
``(C) No credits against tax, etc.--Any increase in
tax under this paragraph shall not be taken into
account in determining the amount of any credit
allowable under part IV of subchapter A of chapter 1 or
in determining the amount of the tax imposed by section
55.
``(D) Changes in form of business disregarded.--A
person shall not be treated as disposing of an interest
in coal mining operations by reason of a mere change in
the form of conducting the trade or business so long as
the coal mining operations are retained in such trade
or business and the taxpayer retains a substantial
interest in such trade or business.
``(g) Refunds in Certain Cases.--A rule similar to the rule of
section 4441(g) shall apply to the tax imposed by this section.
``SEC. 4445. COAL.
``(a) General Rule.--There is hereby imposed a tax on coal received
at any facility in the United States for use as a fuel at such
facility.
``(b) Rate of Tax.--The amount of the tax imposed by subsection (a)
shall be the base rate for each million Btu's of the actual Btu content
of the coal. For purposes of the preceding sentence, the actual Btu
content of any coal shall be determined under procedures prescribed by
the Secretary.
``(c) Liability for Tax.--
``(1) In general.--Except as otherwise provided in this
subsection, the tax imposed by subsection (a) shall be paid by
the operator of the facility.
``(2) Coal received at small facilities.--If the ultimate
vendor of coal received at a facility receives a certificate
from the operator of such facility (or otherwise determines)
that such facility received less than 1,000 tons of coal during
the preceding calendar year, the tax imposed by subsection (a)
shall be paid by the ultimate vendor.
``(3) Residential property.--
``(A) In general.--In the case of coal received at
a residential property, the tax imposed by subsection
(a) shall be paid by the ultimate vendor.
``(B) Residential property.--For purposes of this
paragraph, the term `residential property' means any
building which contains 1 or more dwelling units used
for residential purposes other than on a transient
basis.
``(d) Exemption From Tax for Certain Uses.--
``(1) In general.--No tax shall be imposed by subsection
(a) on coal received for--
``(A) use in the generation of electricity,
``(B) any qualified feedstock use,
``(C) use in enhanced heavy oil recovery (as
determined under section 4444(e)(4) by substituting
`coal' for `natural gas'),
``(D) use in the manufacture or production of
synthetic natural gas or any other synthetic fuel
specified in regulations prescribed by the Secretary,
or
``(E) any use in a vessel used in international
commercial transportation (as defined in section
4442(b)(2)(B)(i)).
``(2) Qualified feedstock use.--For purposes of this
subsection--
``(A) In general.--In the case of any qualified
feedstock use, only the exempt percentage of the coal
shall be exempt from tax under paragraph (1).
``(B) Qualified feedstock use; exempt percentage.--
The terms `qualified feedstock use' and `exempt
percentage' have the respective meanings given such
terms by section 4442(a)(3) determined by substituting
`coal' for `taxable refined petroleum product' each
place it appears.
``(3) Cross reference.--
``For tax on fuel used to produce steam
at facility which also generates electricity, see section 4451(e).
``(e) Production of Coke for Steel.--If tax was imposed under this
subchapter with respect to any coal and such coal is used by any person
to produce coke for use in the reduction of iron-bearing ores in the
iron and steel process, the Secretary shall pay to such person an
amount equal to the base rate for each million Btu's of the actual Btu
content of the coke produced.
``SEC. 4446. ELECTRICITY.
``(a) General Rule.--There is hereby imposed a tax on--
``(1) the sale of electricity to ultimate users in the
United States, and
``(2) the use of electricity in the United States which was
not subject to tax under paragraph (1).
``(b) Rate of Tax.--The amount of the tax imposed by subsection (a)
on each kilowatt hour of electricity sold or used during any month
shall be the deemed Btu tax per kilowatt hour applicable for such
month--
``(1) to the seller in the case of the tax imposed by
subsection (a)(1), and
``(2) to the user in the case of the tax imposed by
subsection (a)(2).
``(c) Liability for, and Collection of, Tax.--
``(1) Sales.--The tax imposed by subsection (a)(1)--
``(A) shall be paid by the person to whom the
electricity is sold, and
``(B) shall be collected by the seller.
``(2) Uses.--The tax imposed by subsection (a)(2) shall be
paid by the person using the electricity.
``(3) Collection of tax.--
``(A) In general.--The seller shall also be liable
for the tax imposed by subsection (a)(1) which is not
collected from the person to whom the electricity is
sold.
``(B) Exception for large users.--Subparagraph (A)
shall not apply to electricity sold to any person
during any month by the seller if the amount paid by
such person for electricity (exclusive of taxes) sold
by such seller during the 12-month period ending before
such month exceeded $3,500,000.
``(d) Deemed Btu Taxes.--For purposes of this section--
``(1) In general.--The deemed Btu taxes per kilowatt hour
of electricity applicable to any person for any month shall be
the weighted average of--
``(A) the deemed Btu taxes per kilowatt hour of
electricity generated at each facility of the person
during the base period, and
``(B) the deemed Btu taxes per kilowatt hour of
electricity purchased by such person during the base
period.
For purposes of this paragraph, the term `base period' means,
with respect to any month, the 2d month preceding such month.
``(2) Deemed btu taxes per facility.--The deemed Btu taxes
per kilowatt hour of electricity generated at any facility
during any month shall be determined by dividing--
``(A) the deemed Btu taxes on fuels used at such
facility to generate electricity during such month by
``(B) the aggregate kilowatt hours of electricity
generated at such facility during such month.
``(3) Deemed btu taxes.--
``(A) In general.--Except as otherwise provided in
this paragraph, the term `deemed Btu taxes' means, with
respect to electricity, the aggregate taxes which would
have been imposed by this subchapter on the fuels used
to generate such electricity--
``(i) but for the exemption of such fuels
from such taxes, and
``(ii) determined as of the month for which
the rate of the tax imposed by subsection (a)
is being determined.
``(B) Electricity generated by hydropower or
nuclear power.--The deemed Btu taxes per kilowatt hour
of electricity generated by hydropower or nuclear power
shall be equal to the base rate multiplied by a
fraction the numerator of which is 10,335 and the
denominator of which is 1,000,000.
``(C) Imported electricity.--
``(i) In general.--Except as provided in
clause (ii), the deemed Btu taxes per kilowatt
hour of electricity transmitted into the United
States shall be determined as if such
electricity were generated by hydropower.
``(ii) Lower deemed btu tax may be
established.--If the importer establishes to
the satisfaction of the Secretary the amount
which would be the deemed Btu taxes per
kilowatt hour of the electricity if the
electricity were generated in the United
States, such amount shall be used in lieu of
the amount under clause (i).
``(D) Electricity generated by renewable sources.--
The deemed Btu taxes per kilowatt hour of electricity
generated from any renewable source shall be zero. For
purposes of the preceding sentence, the term `renewable
source' means solar energy, wind energy, any geothermal
deposit, biomass, municipal solid waste, and tires.
``(4) Sellers to specify deemed btu taxes.--
``(A) In general.--In the case of electricity which
is sold other than to the ultimate user, the seller
shall certify to the purchaser the deemed Btu taxes per
kilowatt hour of the electricity sold.
``(B) Failure to certify.--If the seller fails to
so certify--
``(i) the tax imposed by subsection (a)
shall apply to such sale at the rate specified
in subparagraph (C),
``(ii) the tax imposed by subsection (a)
shall apply to any subsequent sale or use
without regard to clause (i), and
``(iii) the rate specified in subparagraph
(C) shall be the deemed Btu taxes per kilowatt
hour of such electricity for purposes of
determining the tax imposed by subsection (a)
on any subsequent sale or use of such
electricity.
``(C) Rate.--The rate specified in this
subparagraph is, for each kilowatt hour, the product
of--
``(i) the sum of the base rate and the
supplemental rate, multiplied by
``(ii) a fraction the numerator of which is
10,335 and the denominator of which is
1,000,000.
``(5) Regulations.--The Secretary shall prescribe such
regulations as may be necessary or appropriate to carry out
this subsection, including regulations--
``(A) prescribing a base period to be used by any
person not in existence during the base period, and
``(B) prescribing such other modifications to the
application of this subsection as are necessary to
carry out the purposes of this subsection.
``(e) Exceptions.--
``(1) Electricity used in certain electrolytic processes.--
``(A) In general.--In the case of electricity used
in any electrolytic process, the tax imposed by this
section shall not apply to the feedstock portion of
such electricity.
``(B) Feedstock portion.--For purposes of
subparagraph (A), the feedstock portion of electricity
is the portion of the electrical energy which is
incorporated into the manufactured product.
``(2) Electricity used to generate pumped storage, etc.--
The tax imposed by this section shall not apply to electricity
used in the United States to create any hydropower source to
generate electricity. The electricity generated by such
hydropower source shall be disregarded in determining the
deemed Btu taxes of the electricity.
``(3) Use tax exception.--The Secretary may provide by
regulations that the tax imposed by subsection (a)(2) shall not
apply in cases where the Secretary determines that such an
exception is warranted, after taking into account the
protection of revenues to the United States from this
subchapter and the ease of administration for both taxpayers
and the Secretary.
``PART III--TAX RATES
``Sec. 4448. Tax rates.
``SEC. 4448. TAX RATES.
``(a) Base Rate.--For purposes of this subchapter--
``(1) Phase-in rates.--Effective during--
``(A) the 1-year period beginning on July 1, 1994,
the base rate is 8.9 cents, and
``(B) the 1-year period beginning on July 1, 1995,
the base rate is 17.9 cents.
``(2) Permanent unindexed rate.--Effective on and after
July 1, 1996, the base rate is 26.8 cents.
``(3) Indexed rates.--
``(A) In general.--Effective during any calendar
year after 1997, the base rate under paragraph (2)
shall be increased by an amount equal to--
``(i) 26.8 cents, multiplied by
``(ii) the inflation adjustment for such
calendar year.
``(B) Inflation adjustment.--For purposes of
subparagraph (A), the inflation adjustment for any
calendar year is the percentage (if any) by which--
``(i) the GDP deflator for the preceding
calendar year, exceeds
``(ii) the GDP deflator for 1996.
``(C) GDP deflator for calendar year.--For purposes
of subparagraph (B), the GDP deflator for any calendar
year is the GDP deflator for the second calendar
quarter of such year.
``(D) GDP deflator.--For purposes of subparagraph
(C), the term `GDP deflator' means the most recent
revision of the implicit price deflator for the gross
domestic product as computed and published by the
Department of Commerce before November 15 of the
calendar year referred to in subparagraph (B)(i).
``(b) Supplemental Rate.--For purposes of this subchapter--
``(1) Phase-in rates.--Effective during--
``(A) the 1-year period beginning on July 1, 1994,
the supplemental rate is 11.4 cents, and
``(B) the 1-year period beginning on July 1, 1995,
the supplemental rate is 22.8 cents.
``(2) Permanent unindexed rate.--Effective on and after
July 1, 1996, the supplemental rate is 34.2 cents.
``(3) Indexed rates.--Effective during any calendar year
after 1997, the supplemental rate under paragraph (2) shall be
increased by an amount equal to--
``(A) 34.2 cents, multiplied by
``(B) the inflation adjustment for such calendar
year determined under subsection (a)(3)(B).
``(c) Rounding.--If any increase determined under subsection (a)(3)
or (b)(3) is not a multiple of 0.1 cent, such increase shall be rounded
to the nearest multiple of 0.1 cent.
``PART IV--USE TAXES; FLOOR STOCKS TAXES; ADMINISTRATIVE PROVISIONS;
DEFINITIONS AND SPECIAL RULES
``Sec. 4451. Tax on certain uses.
``Sec. 4452. Floor stocks taxes.
``Sec. 4453. Administrative provisions.
``Sec. 4454. Definitions and special
rules.
``SEC. 4451. TAX ON CERTAIN USES.
``(a) General Rule.--There is hereby imposed a tax on the use of
any fossil fuel--
``(1) in the manufacture or production in the United States
of a fuel other than at a refinery, or
``(2) as a fuel.
The preceding sentence shall not apply if tax was imposed under this
subchapter before such use and such tax is not credited or refunded.
``(b) Rate of Tax.--
``(1) In general.--Except as otherwise provided in this
subsection, the amount of tax imposed by subsection (a) shall
be the amount which would be imposed under the appropriate
section of part I or II if such use were a taxable event under
such section.
``(2) Crude oil and other products not taxed on removal or
importation.--The amount of the tax imposed by subsection (a)
on crude oil or other product not subject to tax under part I
or II shall be the base rate (increased by the supplemental
rate in the case of crude oil or any petroleum product other
than any liquefied petroleum gas, isopentane, and natural
gasoline) for each million Btu's of the Btu content of such oil
or product.
``(3) Authority to prescribe applicable per unit btu
factors.--In the case of crude oil or any other product for
which an applicable per unit Btu factor is not prescribed for
purposes of part I or II, the Secretary may prescribe such a
factor, and, if so prescribed, such factor shall apply for
purposes of paragraph (2).
``(c) Liability for Tax.--The taxes imposed by subsection (a) shall
be paid by the person using the fuel.
``(d) Exceptions.--
``(1) In general.--Except as provided in subsection (e),
the tax imposed by this section shall not apply to--
``(A) any use to which section 4442, section
4444(e), or subsection (d) or (e) of section 4445
applies, or
``(B) any use of methane described in section
4444(f)(1)(A).
``(2) Use on production premises.--The tax imposed by this
section shall not apply to any use of crude oil or natural gas
for producing crude oil or natural gas if--
``(A) in the case of crude oil, it is used before
entry at the lease automatic custody transfer point (or
its manual equivalent), and
``(B) in the case of natural gas, it is used before
entry into an interstate or intrastate transmission
pipeline.
``(3) Crude oil used at refinery, etc.--The tax imposed by
this section shall not apply to--
``(A) any use of crude oil at a facility at which
crude oil is refined or any use at such facility of any
product produced at such facility,
``(B) any use of natural gas at a natural gas
processing or fractionation plant or any use at such
plant of any product produced at such plant, or
``(C) any use of ethanol at a facility at which
ethanol is produced for use as a fuel.
``(4) Otherwise taxable event occurring before effective
date.--The tax imposed by this section shall not apply to any
use if no tax would be imposed by this section on such use were
this subchapter in effect for all periods before July 1, 1994.
``(e) Generation of Steam and Electricity.--
``(1) In general.--In the case of a facility which uses any
taxable refined petroleum product, natural gas, or coal--
``(A) to generate electricity, and
``(B) to produce steam which is used or which is
furnished or sold in the trade or business of the
furnishing or sale of steam,
the tax imposed by subsection (a) shall apply to the use of
such product, gas, or coal at such facility to the extent such
use is attributable (determined on the basis of the
proportionate Btu content of the electricity and the steam) to
the production of steam which is so used, furnished, or sold.
``(2) Exceptions.--Paragraph (1) shall not apply to steam
used for any purpose if tax would not be imposed under this
subchapter on the fuel used to produce the steam had such fuel
been used directly for such purpose.
``(f) Treatment of Natural Gas Lost in Transmission.--For purposes
of this section, natural gas lost in transmission by a pipeline shall
be treated as used as a fuel for such pipeline.
``SEC. 4452. FLOOR STOCKS TAXES.
``(a) Imposition of Tax.--There is hereby imposed a tax on any
taxable fuel which on any tax-increase date is held in the United
States by any person.
``(b) Amount of Tax.--The amount of the tax imposed by subsection
(a) on any taxable fuel with respect to any tax-increase date shall be
equal to the excess (if any) of--
``(1) the amount of tax which would be imposed under part I
or II if a taxable event with respect to such fuel had occurred
on such date, over
``(2) the prior tax (if any) imposed by this subchapter on
such fuel.
``(c) Liability for Tax.--The person holding the taxable fuel on
any tax-increase date shall pay the tax imposed by subsection (a).
``(d) Exceptions.--The tax imposed by subsection (a) shall not
apply to--
``(1) any taxable fuel held before the point where it would
otherwise be subject to tax under part I or II, or
``(2) any taxable fuel held by any person exclusively for
any use by such person to the extent a credit or refund (or
other payment) of the tax imposed by this section would be
allowable or payable if such tax were imposed by part I or II.
``(e) Credit Against Tax.--
``(1) In general.--Each person shall be allowed $200 as a
credit against the taxes imposed by subsection (a) with respect
to each tax-increase date. Such credit shall not exceed the
amount of taxes imposed by subsection (a) for which such person
is liable with respect to such date.
``(2) Controlled groups.--For purposes of paragraph (1)--
``(A) all persons who are treated as a single
employer under subsection (a) or (b) of section 52
shall be treated as 1 taxpayer, and
``(B) the $200 amount specified in paragraph (1)
shall be apportioned among such persons under
regulations prescribed by the Secretary.
``(f) Definitions.--For purposes of this section--
``(1) Taxable fuel.--The term `taxable fuel' means any
taxable refined petroleum product, natural gas, or coal.
``(2) Tax-increase date.--The term `tax-increase date'
means--
``(A) July 1, 1994,
``(B) July 1, 1995,
``(C) July 1, 1996, and
``(D) January 1 of each calendar year for which
there is an increase in a rate of tax by reason of
subsection (a)(3) or (b)(3) of section 4448 (relating
to inflation adjustment).
``(g) Due Date.--The tax imposed by subsection (a) shall be paid on
or before the close of the 7-month period beginning on the tax-increase
date.
``SEC. 4453. ADMINISTRATIVE PROVISIONS.
``(a) Rules Relating to Refunds for Exempt and Other Uses.--
``(1) Period for filing claims.--No payment shall be made
under section 4442, 4444(f), or 4445(e) unless, within 2 years
after the date that the event occurs giving rise to a right to
such payment, a claim therefor is filed by the person entitled
to such payment.
``(2) Denial of interest.--Except as provided in paragraph
(3), no interest shall be paid on claims for payments under
section 4442, 4444(f), or 4445(e).
``(3) Minimum amounts and periods.--In the case of persons
who meet such requirements as the Secretary may prescribe, if--
``(A) a claim for payment is filed under section
4442, 4444(f), or 4445(e) for any period for which more
than $1,000 is payable and which is not less than 1
week, and
``(B) the Secretary has not paid such claim within
20 days after the date the claim was filed,
such claim shall be paid with interest from such date using the
overpayment rate and method under section 6621. The preceding
sentence shall not apply to a claim filed under section
4442(b)(1). Nothing in section 6611(e) shall bar interest
payable under this paragraph.
``(4) Heating oil.--
``(A) In general.--Except as provided in
subparagraph (B), not more than 1 claim may be filed
under section 4442(b)(1) by any person with respect to
fuel oil sold by such person during any calendar year.
``(B) Exception.--If $1,000 or more is payable
under section 4442(b)(1) to any person with respect to
fuel oil sold during any of the 1st 3 quarters of the
calendar year, a claim may be filed under section
4442(b)(1) with respect to fuel oil sold during such
quarter. No claim filed under this subparagraph shall
be allowed unless filed on or before the last day of
the 1st quarter following the quarter for which the
claim is filed.
``(5) Applicable laws.--
``(A) In general.--All provisions of law, including
penalties, applicable in respect of the tax imposed by
this subchapter shall, insofar as applicable and not
inconsistent with this subsection and section 4442,
4444(f), or 4445(e), apply in respect of payments
provided for in such section to the same extent as if
such payments constituted refunds of overpayments of
the tax so imposed.
``(B) Examination of books and witnesses.--For the
purpose of ascertaining the correctness of any claim
made under section 4442, 4444(f), or 4445(e), or the
correctness of any payment made in respect of such
claim, the Secretary shall have the authority granted
by paragraphs (1), (2), and (3) of section 7602(a)
(relating to examination of books and witnesses) as if
the claimant were the person liable for tax.
``(b) Payment of Tax to Persons Required to Collect Tax.--
``(1) Payment within 30 days.--In the case of the taxes
imposed by sections 4444 and 4446 which are required to be
collected by another person, the person liable for such tax
shall remit the tax to such other person within 30 days after
the date of the taxable event.
``(2) Relief from penalty for certain failures to collect
tax.--No penalty shall be imposed under this title on the
failure of any person to collect the taxes referred to in
paragraph (1) if--
``(A) during the 30-day period referred to in
paragraph (1), such person exercises due diligence in
attempting to collect such tax, and
``(B) such person notifies the Secretary, within 15
days after the close of the month in which such 30-day
period ends, of the failure to collect such tax and
provides such other information as the Secretary may
require.
``(3) Exception for persons with secondary liability.--
Paragraphs (1) and (2) shall not apply if the person required
to collect the tax is required to pay any portion of such tax
which is not paid by the person primarily liable for such tax.
``(c) Information Reporting.--The Secretary may require--
``(1) information reporting by each remitter of tax imposed
by this subchapter, and
``(2) information reporting by, and registration of, such
other persons as the Secretary deems necessary to carry out
this subchapter.
``(d) Registration.--
``(1) In general.--Every person required by the Secretary
to register under this subsection with respect to any tax
imposed by this subchapter shall register with the Secretary at
such time, in such form and manner, and subject to such terms
and conditions, as the Secretary may by regulations prescribe.
A registration under this subsection may be used only in
accordance with regulations prescribed under this section.
``(2) Other rules.--Rules similar to the rules of section
4101(b) and 4222(c) shall apply for purposes of this
subsection.
``(e) Adjustments to Per Unit Btu Factors.--
``(1) In general.--If the Secretary determines that the
applicable per unit Btu factor then in effect for any taxable
refined petroleum product or natural gas does not, when
multiplied by 1,000,000, properly reflect the Btu content per
unit for such substance (in the circumstances where taxable
events under this subchapter occur with respect to such
substance), the Secretary may modify the applicable per unit
Btu factor for such substance. Any such modification shall be
effective as of the date prescribed by the Secretary.
``(2) Modification of list of refined petroleum products.--
The Secretary may modify, as appropriate, the list of refined
petroleum products in section 4441 for which applicable per
unit Btu factors are separately determined.
``SEC. 4454. DEFINITIONS AND SPECIAL RULES.
``(a) Definitions.--For purposes of this subchapter--
``(1) Fossil fuel.--The term `fossil fuel' means crude oil,
any petroleum product, natural gas, any natural gas product,
and coal.
``(2) Crude oil.--The term `crude oil' includes condensates
from crude oil.
``(3) Coal.--The term `coal' includes lignite.
``(4) United states.--The term `United States' means the 50
States, the District of Columbia, and the foreign trade zones
of the United States.
``(5) Person.--The term `person' includes the United
States, any State or political subdivision thereof, the
District of Columbia, and any agency or instrumentality of any
of the foregoing.
``(c) Fractional Part of Unit.--In the case of a fraction of a
unit, the tax imposed by this subchapter shall be the same fraction of
the amount of such tax imposed on a whole unit.
``(d) Special Rules Relating to Puerto Rico and the Virgin
Islands.--
``(1) Like tax on articles brought into the united states
from puerto rico or the virgin islands.--For purposes of this
subchapter, articles brought into the United States from the
Commonwealth of Puerto Rico or the Virgin Islands shall be
treated as entered into the United States at the time brought
into the United States.
``(2) Disposition of revenues.--The provisions of
subsections (a)(3) and (b)(3) of section 7652 shall not apply
to any tax imposed by this subchapter.
``(e) No Exemption From Tax.--No person shall be exempt from any
tax imposed by this subchapter except to the extent provided in this
subchapter or in any provision of law enacted after the date of the
enactment of this subchapter which grants a specific exemption, by
reference to this subchapter, from a tax imposed by this subchapter.
``PART V--TAX ON IMPORTED HIGH-ENERGY PRODUCTS
``Sec. 4456. Imposition of tax.
``Sec. 4457. Definitions and special
rules.
``SEC. 4456. IMPOSITION OF TAX.
``(a) General Rule.--There is hereby imposed a tax on any taxable
high-energy product entered into the United States for consumption,
use, or warehousing.
``(b) Amount of Tax.--The amount of the tax imposed by subsection
(a) on any taxable high-energy product shall be the imputed Btu tax
with respect to such product.
``(c) Liability for Tax.--The tax imposed by subsection (a) shall
be paid by the person entering the product for consumption, use, or
warehousing.
``SEC. 4457. DEFINITIONS AND SPECIAL RULES.
``(a) Taxable High-Energy Product.--For purposes of this part--
``(1) In general.--The term `taxable high-energy product'
means any product which, at the time entered into the United
States for consumption, use, or warehousing, is listed as a
taxable high-energy product by the Secretary.
``(2) Determination of products on list.--A product shall
be listed under paragraph (1) if the product is produced in an
industry identified (using 4-digit SIC codes) in the most
recent census of manufacturing as producing products which on
average have more than 2 percent of their value attributable to
direct energy inputs (exclusive of the tax imposed by parts I
and II) of taxable energy sources.
``(3) Taxable energy source.--The term `taxable energy
source' means any taxable refined petroleum product, natural
gas, coal, and electricity.
``(b) Imputed Btu Tax.--For purposes of this part--
``(1) In general.--Except as otherwise provided in this
subsection, the term `imputed Btu tax' means, with respect to
any taxable high-energy product, the amount of tax which would
have been imposed by parts I and II on taxable energy sources
directly used in the manufacture or production of the product
if--
``(A) such product were manufactured or produced
using the predominant method of manufacture or
production of such product in the United States, and
``(B) such taxable energy sources had been subject
to tax under such parts on the date of the entry of the
product into the United States for consumption, use, or
warehousing.
``(2) Tax where information furnished.--If the person
liable for the tax imposed by section 4456 with respect to any
product furnishes to the Secretary (at such time and in such
manner as the Secretary shall prescribe) sufficient information
to determine the imputed Btu tax with respect to such product,
the imputed Btu tax determined using such information shall
apply in lieu of the amount determined under paragraph (1).
``(c) Requests To Change List.--If any importer or producer of any
product requests that the Secretary determine whether--
``(1) such product should be listed as a taxable high-
energy product under subsection (a)(1) or be removed from such
listing, or
``(2) the imputed Btu tax for such product under subsection
(b)(1),
the Secretary shall make such determination within 180 days after the
date the request was filed.''
(b) Refunds for Farm Use of Gasoline and Diesel Fuel.--
(1) Gasoline.--
(A) Subsection (a) of section 6420 is amended by
adding at the end thereof the following new flush
sentence:
``If the supplemental rate of the tax imposed by section 4441 was
imposed on such gasoline, the Secretary shall also pay (without
interest) to such ultimate purchaser an amount equal to the product of
such supplemental rate and the applicable per unit Btu factor per
barrel (determined under section 4441) of the gasoline so used.''
(B) Subsection (h) of section 6420 is amended by
inserting ``and taxes imposed by section 4441'' after
``financing rate''.
(2) Diesel fuel.--
(A) Section 6427 is amended by redesignating
subsections (m) through (r) as subsections (n) through
(s), respectively, and by inserting after subsection
(l) the following new subsection:
``(m) Refunds of Supplemental Rate of Btu Tax on Farm Use of Diesel
Fuel.--Except as provided in subsection (k), if the supplemental rate
of the tax imposed by section 4441 was imposed on diesel fuel used on a
farm for farming purposes (within the meaning of section 6420(c)), the
Secretary shall pay (without interest) to the ultimate purchaser of
such fuel an amount equal to the product of such supplemental rate and
the applicable per unit Btu factor per barrel (determined under section
4441) of the diesel fuel so used.''
(B) Paragraph (1) of section 6427(i) is amended by
inserting ``(m),'' after ``(l),''.
(C) Paragraph (4) of section 6427(i), as amended by
subpart B, is amended--
(i) by striking ``or 4091'' in the
paragraph heading and inserting ``, 4091, or
4441'', and
(ii) by striking ``subsection (l)'' each
place it appears and inserting ``subsections
(l) and (m)''.
(c) Civil Penalty For Using Reduced-Rate Fuel For Taxable Use.--
(1) In general.--Part I of subchapter B of chapter 68
(relating to assessable penalties) is amended by adding at the
end thereof the following new section:
``SEC. 6714. DYED FUEL SOLD FOR USE OR USED IN TAXABLE USE.
``(a) Imposition of Penalty.--If any dyed fuel--
``(1) is sold by any person for any use which such person
knows or has reason to know is not a reduced-tax use of such
fuel, or
``(2) is used by any person for a use other than a reduced-
tax use and such person knew, or had reason to know, that such
fuel was so dyed,
then, in addition to the tax, such person shall pay a penalty on such
sale or use.
``(b) Amount of Penalty.--The amount of the penalty under
subsection (a) on any sale or use shall be the greater of--
``(1) $1,000, or
``(2) an amount equal to twice the excess of the aggregate
taxes which should have been imposed under section 4441 on the
fuel so sold or used over the prior taxes (if any) imposed on
such fuel under such section which have not been credited or
refunded.
``(c) Definitions.--For purposes of this section--
``(1) Dyed fuel.--The term `dyed fuel' means--
``(A) qualified heating oil (as defined in section
4441(b)(2)(B)), and
``(B) diesel fuel dyed in accordance with section
4441(b)(2)(C).
``(2) Reduced-tax use.--The term `reduced-tax use' means,
with respect to any fuel, the use for which such fuel was
dyed.''
(2) Clerical amendment.--The table of sections for such
part I is amended by adding at the end thereof the following
new item:
``Sec. 6714. Dyed fuel sold for use or
used in taxable use.''
(d) Technical Amendments.--
(1)(A) Subsection (a) of section 6675 is amended by
inserting ``section 4442 (relating to refunds of petroleum tax
for certain sales and uses), section 4444(f) (relating to
methane recovered from biomass or coal mining), section 4445(e)
(relating to coal used in production of coke for steel),''
before ``section 6420''.
(B) Subsection (b) of section 6675 is amended by inserting
``4442, 4444(f), 4445(e),'' before ``6420''.
(2) Section 6206 is amended--
(A) by inserting ``(a) Fuel Taxes.--'' before ``Any
portion of'', and
(B) by adding at the end thereof the following new
subsection:
``(b) Btu Taxes.--Any portion of a payment made under section 4442,
4444(f), or 4445(e) which constitutes an excessive amount (as defined
in section 6675(b)), and any civil penalty provided by section 6675,
may be assessed and collected as if it were a tax imposed by subchapter
A of chapter 36 and as if the person who made the claim were liable for
such tax. The period for assessing any such portion, and for assessing
any such penalty, shall be 3 years from the last day prescribed for
filing a claim under section 4442, 4444(f), or 4445(e).''
(3)(A) The section heading for section 6206 is amended by
striking ``under sections 6420, 6421, and 6427'' and inserting
``for certain fuels tax refunds and energy tax refunds''.
(B) The item relating to section 6206 in the table of
sections for subchapter A of chapter 63 is amended by striking
``under sections 6420, 6421, and 6427'' and inserting ``for
certain fuels tax refunds and energy tax refunds''.
(4) Subparagraph (B) of section 6724(d)(1) is amended--
(A) by striking ``or'' at the end of clause (xi),
(B) by striking the period at the end of the clause
(xii) relating to section 4101(d) and inserting a
comma,
(C) by redesignating the clause (xii) relating to
section 338(h)(10)(C) as clause (xiii) and by striking
the period at the end thereof and inserting ``, or'',
and
(D) by inserting after clause (xiii), as so
redesignated, the following new clause:
``(xiv) section 4453(c) (relating to
information reporting with respect to energy
taxes).''
(5) Sections 7210, section 7603, subsections (b) and (c)(2)
of section 7604, section 7605, and 7610(c) are each amended by
inserting ``4453(a)(5)(B),'' before ``6420(e)(2)'' each place
it appears.
(6) Subparagraph (A) of section 9505(c)(3) is amended by
striking ``subchapter A'' and inserting ``subchapter B''.
(7) The table of subchapters for chapter 36 is amended by
striking the items relating to subchapters A and B and
inserting the following:
``Subchapter A. Energy taxes.
``Subchapter B. Harbor maintenance tax.
``Subchapter C. Transportation by
water.''
(e) Effective Date.--The amendments made by this section shall take
effect on July 1, 1994.
Subpart B--Modifications to Tax on Diesel Fuel
SEC. 14242. MODIFICATIONS TO TAX ON DIESEL FUEL.
(a) In General.--Subparts A and B of part III of subchapter A of
chapter 32 (relating to manufacturers excise taxes) are amended to read
as follows:
``Subpart A--Gasoline and Diesel Fuel
``Sec. 4081. Imposition of tax.
``Sec. 4082. Exemptions for diesel fuel.
``Sec. 4083. Definitions and special
rule.
``Sec. 4084. Cross references.
``SEC. 4081. IMPOSITION OF TAX.
``(a) Tax Imposed.--
``(1) Tax on removal, entry, or sale.--
``(A) In general.--There is hereby imposed a tax at
the rate specified in paragraph (2) on--
``(i) the removal of a taxable fuel from
any refinery,
``(ii) the removal of a taxable fuel from
any terminal,
``(iii) the entry into the United States of
any taxable fuel for consumption, use, or
warehousing, and
``(iv) the sale of a taxable fuel to any
person who is not registered under section 4101
unless there was a prior taxable removal or
entry of such fuel under clause (i), (ii), or
(iii).
``(B) Exemption for bulk transfers to registered
terminals.--The tax imposed by this paragraph shall not
apply to any removal or entry of a taxable fuel
transferred in bulk to a terminal if the person
removing or entering the taxable fuel and the operator
of such terminal are registered under section 4101.
``(2) Rates of tax.--
``(A) In general.--The rate of the tax imposed by
this section is the sum of--
``(i) the Highway Trust Fund financing
rate,
``(ii) the Leaking Underground Storage Tank
Trust Fund financing rate, and
``(iii) the deficit reduction rate.
``(B) Rates.--For purposes of subparagraph (A)--
``(i) the Highway Trust Fund financing rate
is--
``(I) 11.5 cents per gallon in the
case of gasoline, and
``(II) 17.5 cents per gallon in the
case of diesel fuel,
``(ii) the Leaking Underground Storage Tank
Trust Fund financing rate is 0.1 cent per
gallon, and
``(iii) the deficit reduction rate is 2.5
cents per gallon.
``(b) Treatment of Removal or Subsequent Sale by Blender.--
``(1) In general.--There is hereby imposed a tax at the
rate specified in subsection (a) on taxable fuel removed or
sold by the blender thereof.
``(2) Credit for tax previously paid.--If--
``(A) tax is imposed on the removal or sale of a
taxable fuel by reason of paragraph (1), and
``(B) the blender establishes the amount of the tax
paid with respect to such fuel by reason of subsection
(a),
the amount of the tax so paid shall be allowed as a credit
against the tax imposed by reason of paragraph (1).
``(c) Taxable Fuels Mixed With Alcohol at Refinery, Etc.--
``(1) Reduced rates.--
``(A) In general.--Under regulations prescribed by
the Secretary, subsection (a) shall be applied by
substituting rates which are the applicable fraction of
the otherwise applicable rates in the case of the
removal or entry of any taxable fuel for use in
producing at the time of such removal or entry a
qualified alcohol mixture. Subject to such terms and
conditions as the Secretary may prescribe (including
the application of section 4101), the treatment under
the preceding sentence also shall apply to use in
producing such a mixture after the time of such removal
or entry.
``(B) Applicable fraction.--For purposes of
subparagraph (A), the applicable fraction is--
``(i) in the case of a qualified alcohol
mixture which contains gasoline, the fraction
the numerator of which is 10 and the
denominator of which is--
``(I) 9 in the case of 10 percent
gasohol,
``(II) 9.23 in the case of 7.7
percent gasohol, and
``(III) 9.43 in the case of 5.7
percent gasohol, and
``(ii) in the case of a qualified alcohol
mixture which does not contain gasoline, \10/
9\.
``(2) Later separation of fuel from qualified alcohol
mixture.--If any person separates the taxable fuel from a
qualified alcohol mixture on which tax was imposed under
subsection (a) at the otherwise applicable Highway Trust Fund
financing rate (or its equivalent) by reason of this subsection
(or with respect to which a credit or payment was allowed or
made by reason of section 6427(f)(1)), such person shall be
treated as the refiner of such taxable fuel. The amount of tax
imposed on any removal of such fuel by such person shall be
reduced by the amount of tax imposed (and not credited or
refunded) on any prior removal or entry of such fuel.
``(3) Alcohol; qualified alcohol mixture.--For purposes of
this subsection--
``(A) Alcohol.--The term `alcohol' includes
methanol and ethanol but does not include alcohol
produced from petroleum, natural gas, or coal
(including peat). Such term does not include alcohol
with a proof of less than 190 (determined without
regard to any added denaturants).
``(B) Qualified alcohol mixture.--The term
`qualified alcohol mixture' means--
``(i) any mixture of gasoline with alcohol
if at least 5.7 percent of such mixture is
alcohol, and
``(ii) any mixture of diesel fuel with
alcohol if at least 10 percent of such mixture
is alcohol.
``(4) Otherwise applicable rates for gasoline mixtures.--
For purposes of this subsection--
``(A) In general.--In the case of the Highway Trust
Fund financing rate, the otherwise applicable rate for
gasoline in a qualified alcohol mixture is--
``(i) 6.1 cents a gallon for 10 percent
gasohol,
``(ii) 7.342 cents a gallon for 7.7 percent
gasohol, and
``(iii) 8.422 cents a gallon for 5.7
percent gasohol.
In the case of a mixture none of the alcohol in which
consists of ethanol, clauses (i), (ii), and (iii) shall
be applied by substituting `5.5 cents' for `6.1 cents',
`6.88 cents' for `7.342 cents', and `8.08 cents' for
`8.422 cents'.
``(B) 10 percent gasohol.--The term `10 percent
gasohol' means any mixture of gasoline with alcohol if
at least 10 percent of such mixture is alcohol.
``(C) 7.7 percent gasohol.--The term `7.7 percent
gasohol' means any mixture of gasoline with alcohol if
at least 7.7 percent, but not 10 percent or more, of
such mixture is alcohol.
``(D) 5.7 percent gasohol.--The term `5.7 percent
gasohol' means any mixture of gasoline with alcohol if
at least 5.7 percent, but not 7.7 percent or more, of
such mixture is alcohol.
``(5) Otherwise applicable rates for diesel fuel
mixtures.--For purposes of this subsection, in the case of the
Highway Trust Fund financing rate, the otherwise applicable
rate for diesel fuel in a qualified alcohol mixture is 12.1
cents per gallon (11.5 cents per gallon in the case of a
qualified alcohol mixture none of the alcohol in which consists
of ethanol).
``(6) Termination.--Paragraph (1) shall not apply to any
removal or sale after September 30, 2000.
``(d) Termination.--
``(1) Highway trust fund financing rate.--On and after
October 1, 1999, the Highway Trust Fund financing rate under
subsection (a)(2) shall not apply.
``(2) Leaking underground storage tank trust fund financing
rate.--The Leaking Underground Storage Tank Trust Fund
financing rate under subsection (a)(2) shall not apply after
December 31, 1995.
``(3) Deficit reduction rate.--On and after October 1,
1995, the deficit reduction rate under subsection (a)(2) shall
not apply.
``(e) Refunds in Certain Cases.--Under regulations prescribed by
the Secretary, if any person who paid the tax imposed by this section
with respect to any taxable fuel establishes to the satisfaction of the
Secretary that a prior tax was paid (and not credited or refunded) with
respect to such taxable fuel, then an amount equal to the tax paid by
such person shall be allowed as a refund (without interest) to such
person in the same manner as if it were an overpayment of tax imposed
by this section.
``SEC. 4082. EXEMPTIONS FOR DIESEL FUEL.
``(a) In General.--The tax imposed by section 4081 shall not apply
to diesel fuel--
``(1) which the Secretary determines is destined for a
nontaxable use,
``(2) which is indelibly dyed in accordance with
regulations which the Secretary shall prescribe, and
``(3) which meets such marking requirements (if any) as may
be prescribed by the Secretary in regulations.
``(b) Nontaxable Use.--For purposes of this section, the term
`nontaxable use' means--
``(1) any use which is exempt from the tax imposed by
section 4041(a)(1) other than by reason of the imposition of
tax on any sale thereof,
``(2) any use in a train, and
``(3) any use described in section 6427(b)(1).
``(c) Regulations.--The Secretary shall prescribe such regulations
as may be necessary to carry out this section, including regulations
requiring the conspicuous labeling of retail diesel fuel pumps and
other delivery facilities to assure that persons are aware of which
fuel is available only for nontaxable uses.
``(d) Cross Reference.--
``For tax on train, motorboat, and
certain bus uses of fuel purchased tax-free, see section 4041(a)(1).
``SEC. 4083. DEFINITIONS AND SPECIAL RULE.
``(a) Taxable Fuel.--For purposes of this subpart--
``(1) In general.--The term `taxable fuel' means--
``(A) gasoline, and
``(B) diesel fuel.
``(2) Gasoline.--The term `gasoline' includes, to the
extent prescribed in regulations--
``(A) gasoline blend stocks, and
``(B) products commonly used as additives in
gasoline.
For purposes of subparagraph (A), the term `gasoline blend
stock' means any petroleum product component of gasoline.
``(3) Diesel fuel.--The term `diesel fuel' means any liquid
(other than gasoline) which is suitable for use as a fuel in a
diesel-powered highway vehicle, a diesel-powered train, or a
diesel-powered boat.
``(b) Certain Uses Defined as Removal.--If any person uses taxable
fuel (other than in the production of gasoline, diesel fuel, or special
fuels referred to in section 4041), such use shall for the purposes of
this chapter be considered a removal.
``SEC. 4084. CROSS REFERENCES.
``(1) For provisions to relieve farmers
from excise tax in the case of gasoline used on the farm for farming
purposes, see section 6420.
``(2) For provisions to relieve
purchasers of gasoline from excise tax in the case of gasoline used for
certain nonhighway purposes, used by local transit systems, or sold for
certain exempt purposes, see section 6421.
``(3) For provisions to relieve
purchasers from excise tax in the case of taxable fuel not used for
taxable purposes, see section 6427.
``Subpart B--Aviation Fuel
``Sec. 4091. Imposition of tax.
``Sec. 4092. Exemptions.
``Sec. 4093. Definitions.
``SEC. 4091. IMPOSITION OF TAX.
``(a) In General.--There is hereby imposed a tax on the sale of
aviation fuel by the producer or the importer thereof or by any
producer of aviation fuel.
``(b) Rate of Tax.--
``(1) In general.--The rate of the tax imposed by
subsection (a) shall be the sum of--
``(A) the Airport and Airway Trust Fund financing
rate, and
``(B) the Leaking Underground Storage Tank Trust
Fund financing rate.
``(2) Airport and airway trust fund financing rate.--For
purposes of paragraph (1), the Airport and Airway Trust Fund
financing rate is 17.5 cents per gallon.
``(3) Leaking underground storage tank trust fund financing
rate.--For purposes of paragraph (1), the Leaking Underground
Storage Tank Trust Fund financing rate is 0.1 cent per gallon.
``(4) Termination of rates.--
``(A) The Airport and Airway Trust Fund financing
rate shall not apply on and after January 1, 1996.
``(B) The Leaking Underground Storage Tank Fund
financing rate shall not apply during any period during
which the Leaking Underground Storage Tank Trust Fund
financing rate under section 4081 does not apply.
``(c) Reduced Rate of Tax for Aviation Fuel in Alcohol Mixture,
Etc.--
``(1) In general.--The Airport and Airway Trust Fund
financing rate shall be--
``(A) 4.1 cents per gallon in the case of the sale
of any mixture of aviation fuel if--
``(i) at least 10 percent of such mixture
consists of alcohol (as defined in section
4081(c)(3)), and
``(ii) the aviation fuel in such mixture
was not taxed under subparagraph (B), and
``(B) 4.56 cents per gallon in the case of the sale
of aviation fuel for use (at the time of such sale) in
producing a mixture described in subparagraph (A).
In the case of a sale described in subparagraph (B), the
Leaking Underground Storage Tank Trust Fund financing rate
shall be \1/9\ cent per gallon.
``(2) Later separation.--If any person separates the
aviation fuel from a mixture of the aviation fuel and alcohol
on which tax was imposed under subsection (a) at the Airport
and Airway Trust Fund financing rate equivalent to 4.1 cents
per gallon by reason of this subsection (or with respect to
which a credit or payment was allowed or made by reason of
section 6427(f)(1)), such person shall be treated as the
producer of such aviation fuel. The amount of tax imposed on
any sale of such aviation fuel by such person shall be reduced
by the amount of tax imposed (and not credited or refunded) on
any prior sale of such fuel.
``(3) Termination.--Paragraph (1) shall not apply to any
sale after September 30, 2000.
``(d) Lower Rates of Tax on Alcohol Mixtures Not Made From
Ethanol.--In the case of a mixture described in subsection (c)(1)(A)(i)
none of the alcohol in which is ethanol--
``(1) subsections (c)(1)(A) and (c)(2) shall each be
applied by substituting rates which are 0.6 cents less than the
rates contained therein, and
``(2) subsection (c)(1)(B) shall be applied by substituting
rates which are \10/9\ of the rates determined under paragraph
(1).
``SEC. 4092. EXEMPTIONS.
``(a) Nontaxable Uses.--The Airport and Airway Trust Fund financing
rate under section 4091 shall not apply to aviation fuel sold by a
producer or importer for use by the purchaser in a nontaxable use (as
defined in section 6427(l)(2)(B)).
``(b) Sales to Producer.--Under regulations prescribed by the
Secretary, the tax imposed by section 4091 shall not apply to aviation
fuel sold to a producer of such fuel.
``(c) Supplies for Vessels and Aircraft.--Under regulations
prescribed by the Secretary, the Leaking Underground Storage Tank Trust
Fund financing rate under section 4091 shall not apply to aviation fuel
sold for use or used as supplies for vessels or aircraft (within the
meaning of section 4221(d)(3)).
``SEC. 4093. DEFINITIONS.
``(a) Aviation Fuel.--For purposes of this subpart, the term
`aviation fuel' means any liquid (other than any product taxable under
section 4081) which is suitable for use as a fuel in an aircraft.
``(b) Producer.--For purposes of this subpart--
``(1) Certain persons treated as producers.--
``(A) In general.--The term `producer' includes any
person described in subparagraph (B) and registered
under section 4101 with respect to the tax imposed by
section 4091.
``(B) Persons described.--A person is described in
this subparagraph if such person is--
``(i) a refiner, blender, or wholesale
distributor of aviation fuel, or
``(ii) a dealer selling aviation fuel
exclusively to producers of aviation fuel.
``(C) Reduced rate purchasers treated as
producers.--Any person to whom aviation fuel is sold at
a reduced rate under this subpart shall be treated as
the producer of such fuel.
``(2) Wholesale distributor.--For purposes of paragraph
(1), the term `wholesale distributor' includes any person who
sells aviation fuel to producers, retailers, or to users who
purchase in bulk quantities and deliver into bulk storage
tanks. Such term does not include any person who (excluding the
term `wholesale distributor' from paragraph (1)) is a producer
or importer.''
(b) Civil Penalty For Using Reduced-Rate Fuel For Taxable Use.--
(1) Paragraph (1) of section 6714(c), as added by subpart
A, is amended by striking ``and'' at the end of subparagraph
(A), by striking the period at the end of subparagraph (B) and
inserting ``, and'', and by adding at the end thereof the
following new subparagraph:
``(C) diesel fuel dyed in accordance with section
4082.''
(2) Paragraph (2) of section 6714(b), as added by subpart
A, is amended by striking ``section 4441'' and inserting
``sections 4081 and 4441'' and by striking ``such section'' and
inserting ``such sections''.
(c) Technical and Conforming Amendments.--
(1) Subsection (c) of section 40 is amended by striking ``,
section 4081(c), or section 4091(c)'' and inserting ``or
section 4081(c)''.
(2) Subsection (a) of section 4101 is amended by striking
``4081'' and inserting ``4041(a)(1), 4081,''.
(3) Section 4102 is amended by striking ``gasoline'' and
inserting ``any taxable fuel (as defined in section 4083)''.
(4) Paragraph (1) of section 4041(a) is amended to read as
follows:
``(1) Tax on diesel fuel in certain cases.--
``(A) In general.--There is hereby imposed a tax on
any liquid other than gasoline (as defined in section
4083)--
``(i) sold by any person to an owner,
lessee, or other operator of a diesel-powered
highway vehicle, a diesel-powered train, or a
diesel-powered boat for use as a fuel in such
vehicle, train, or boat, or
``(ii) used by any person as a fuel in a
diesel-powered highway vehicle, a diesel-
powered train, or a diesel-powered boat unless
there was a taxable sale of such fuel under
clause (i).
``(B) Exemption for previously taxed fuel.--No tax
shall be imposed by this paragraph on the sale or use
of diesel fuel if there was a taxable sale of such fuel
under section 4081 and the tax thereon was not credited
or refunded.
``(C) Rate of tax.--
``(i) In general.--Except as otherwise
provided in this subparagraph, the rate of the
tax imposed by this paragraph shall be the sum
of the Highway Trust Fund financing rate on
diesel fuel and the deficit reduction rate in
effect under section 4081 at the time of such
sale or use.
``(ii) Highway rate not to apply to
trains.--The Highway Trust Fund financing rate
shall not apply to any sale for use, or use, of
fuel in a train.
``(iii) Certain bus uses.--If the
limitation in section 6427(b)(2)(A) applies to
fuel sold for use or used in an automobile bus,
the Highway Trust Fund financing rate shall be
3 cents per gallon and the deficit reduction
rate shall not apply.''
(5) Paragraph (2) of section 4041(a) is amended by striking
``or paragraph (1) of this subsection'' and by inserting ``on
gasoline'' after ``Highway Trust Fund financing rate''.
(6) Paragraph (2) of section 4041(c) is amended by striking
``any product taxable under section 4081'' and inserting
``gasoline (as defined in section 4083)''.
(7) Paragraph (2) of section 4041(d) is amended--
(A) by striking ``(other than a product taxable
under section 4081)'' and inserting ``(other than
gasoline (as defined in section 4083))'', and
(B) by striking ``section 4091'' and inserting
``section 4081''.
(8) Paragraph (3) of section 4041(d) is amended by striking
``(other than any product taxable under section 4081)'' and
inserting ``(other than gasoline (as defined in section
4083))''.
(9) Subparagraph (A) of section 4041(k)(1) is amended by
striking ``sections 4081(c) and 4091(c), as the case may be''
and inserting ``section 4081(c)''.
(10) Subparagraph (B) of section 4041(m)(1) is amended by
striking ``section 4091(d)(1)'' and inserting ``section
4091(c)(1)''.
(11) Section 6206 is amended by striking ``4041 or 4091''
and inserting ``4041, 4081, or 4091''.
(12) Paragraph (1) of section 6302(f) is amended by
inserting ``on gasoline'' after ``section 4081'' and after
``such tax''.
(13) Paragraph (1) of section 6412(a) is amended by
striking ``gasoline'' each place it appears (including the
heading) and inserting ``taxable fuel''.
(14)(A) Subparagraph (A) of section 6416(a)(4) is amended
by striking ``product'' each place it appears and inserting
``gasoline''.
(B) Subparagraph (B) of section 6416(a)(4) is amended by
striking all that follows ``substituting'' and inserting ```any
gasoline taxable under section 4081' for `aviation fuel'
therein).''
(15) Sections 6420(c)(5) and 6421(e)(1) are each amended by
striking ``section 4082(b)'' and inserting ``section 4083(a)''.
(16) Subsection (b) of section 6427 is amended--
(A) by striking ``if any fuel'' in paragraph (1)
and inserting ``if any diesel fuel (as defined in
section 4083(a))'', and
(B) by striking ``4091'' each place it appears and
inserting ``4081''.
(17)(A) Paragraph (1) of section 6427(f) is amended by
striking ``4091(c)(1)(A), or 4091(d)(1)(A)'' and inserting ``or
4091(c)(1)(A)''.
(B) Paragraph (2) of section 6427(f) is amended to read as
follows:
``(2) Definitions.--For purposes of paragraph (1)--
``(A) Regular tax rate.--The term `regular tax
rate' means--
``(i) in the case of gasoline or diesel
fuel, the aggregate rate of tax imposed by
section 4081 determined without regard to
subsection (c) thereof, and
``(ii) in the case of aviation fuel, the
aggregate rate of tax imposed by section 4091
determined without regard to subsection (c)
thereof.
``(B) Incentive tax rate.--The term `incentive tax
rate' means--
``(i) in the case of gasoline or diesel
fuel, the aggregate rate of tax imposed by
section 4081 with respect to fuel described in
subsection (c)(1) thereof, and
``(ii) in the case of aviation fuel, the
aggregate rate of tax imposed by section 4091
with respect to fuel described in subsection
(c)(1)(B) thereof.''
(18) Subsection (h) of section 6427 is amended by striking
``section 4082(b)'' and inserting ``section 4083(a)(2)''.
(19) Paragraph (3) of section 6427(i) is amended--
(A) by striking ``gasohol'' in the heading and
inserting ``alcohol mixture'', and
(B) by striking ``gasoline used to produce gasohol
(as defined in section 4081(c)(1))'' in subparagraph
(A) and inserting ``gasoline or diesel fuel used to
produce a qualified alcohol mixture (as defined in
section 4081(c)(3))''.
(20) The heading of paragraph (4) of section 6427(i) is
amended by inserting ``4081 or'' before ``4091''.
(21) Subsection (l) of section 6427 is amended to read as
follows:
``(l) Nontaxable Uses of Diesel Fuel and Aviation Fuel.--
``(1) In general.--Except as provided in subsection (k) and
in paragraphs (3) and (4) of this subsection, if--
``(A) any diesel fuel on which tax has been imposed
by section 4081, or
``(B) any aviation fuel on which tax has been
imposed by section 4091,
is used by any person in a nontaxable use, the Secretary shall
pay (without interest) to the ultimate purchaser of such fuel
an amount equal to the aggregate amount of tax imposed on such
fuel under section 4081 or 4091, as the case may be.
``(2) Nontaxable use.--For purposes of this subsection, the
term `nontaxable use' means--
``(A) in the case of diesel fuel, any use which is
exempt from the tax imposed by section 4041(a)(1) other
than by reason of the imposition of tax on any sale
thereof, and
``(B) in the case of aviation fuel, any use which
is exempt from the tax imposed by section 4041(c)(1)
other than by reason of the imposition of tax on any
sale thereof.
``(3) Limit on refund of leaking underground storage tank
trust fund financing rate.--Paragraph (1) shall not apply to so
much of the tax imposed by section 4081 or 4091 as is
attributable to the Leaking Underground Storage Tank Trust Fund
financing rate imposed by such section in the case of--
``(A) fuel used in a diesel-powered train, and
``(B) fuel used in any aircraft (other than as
supplies for vessels or aircraft, within the meaning of
section 4221(d)(3)).
``(4) No refund of deficit reduction tax on fuel used in
trains.--Fuel used in a diesel-powered train shall be treated
as a nontaxable use for purposes of this section, except that
paragraph (1) shall not apply to so much of the tax imposed by
section 4081 as is attributable to the deficit reduction rate
imposed by such section unless such fuel was used by a State or
any political subdivision thereof.''
(22) Paragraph (1) of section 9503(b) is amended--
(A) by striking ``gasoline),'' in subparagraph (E)
and inserting ``gasoline and diesel fuel), and'',
(B) by striking subparagraph (F), and
(C) by redesignating subparagraph (G) as
subparagraph (F).
(23)(A) Subparagraph (B) of section 9503(b)(4) is amended
by striking ``, 4081, and 4091'' and inserting ``and 4081''.
(B) Subparagraph (C) of section 9503(b)(4), as amended by
subtitle A, is amended by striking ``4091'' and inserting
``4081''.
(24) Subparagraph (D) of section 9503(c)(6) is amended by
striking ``, 4081, and 4091'' and inserting ``and 4081''.
(25) Paragraph (2) of section 9503(e) is amended--
(A) by striking ``, 4081, and 4091'' and inserting
``and 4081'', and
(B) by striking ``, 4081, or 4091'' and inserting
``or 4081''.
(26) Subsection (b) of section 9508 is amended--
(A) by inserting ``and diesel fuel'' after
``gasoline'' in paragraph (2),
(B) by striking ``diesel fuel and'' in paragraph
(3), and
(C) by striking ``4091'' in the last sentence, as
added by subtitle A, and inserting ``4081''.
(27) The table of subparts for part III of subchapter A of
chapter 32 is amended by striking the items relating to
subparts A and B and inserting the following new items:
``Subpart A. Gasoline and diesel fuel.
``Subpart B. Aviation fuel.''
(d) Effective Date.--The amendments made by this section shall take
effect on April 1, 1994.
SEC. 14243. FLOOR STOCKS TAX.
(a) In General.--There is hereby imposed a floor stocks tax on
diesel fuel held by any person on April 1, 1994, if--
(1) no tax was imposed on such fuel under section 4041(a)
or 4091 of the Internal Revenue Code of 1986 as in effect on
the day before the date of the enactment of this Act, and
(2) tax would have been imposed by section 4081 of such
Code, as amended by this Act, on any prior removal, entry, or
sale of such fuel had such section 4081 applied to all prior
removals, entries, and sales of such fuel.
(b) Rate of Tax.--The rate of the tax imposed by subsection (a)
shall be the amount of tax which would be imposed under section 4081 of
the Internal Revenue Code of 1986 if there were a taxable sale of such
fuel on such date.
(c) Liability and Payment of Tax.--
(1) Liability for tax.--A person holding the diesel fuel on
April 1, 1994, to which the tax imposed by this section applies
shall be liable for such tax.
(2) Method of payment.--The tax imposed by this section
shall be paid in such manner as the Secretary shall prescribe.
(3) Time for payment.--The tax imposed by this section
shall be paid on or before January 31, 1995.
(d) Definitions.--For purposes of this section--
(1) Diesel fuel.--The term ``diesel fuel'' has the meaning
given such term by section 4083(a) of such Code.
(2) Secretary.--The term ``Secretary'' means the Secretary
of the Treasury or his delegate.
(e) Exceptions.--
(1) Persons entitled to credit or refund.--The tax imposed
by this section shall not apply to fuel held by any person
exclusively for any use to the extent a credit or refund of the
tax imposed by section 4081 is allowable for such use.
(2) Compliance with dyeing required.--Paragraph (1) shall
not apply to the holder of any fuel if the holder of such fuel
fails to comply with any requirement imposed by the Secretary
with respect to dyeing and marking such fuel.
(f) Other Laws Applicable.--All provisions of law, including
penalties, applicable with respect to the taxes imposed by section 4081
of such Code shall, insofar as applicable and not inconsistent with the
provisions of this section, apply with respect to the floor stock taxes
imposed by this section to the same extent as if such taxes were
imposed by such section 4081.
Subpart C--Extension of Motor Fuel Tax Rates; Increased Deposits Into
Highway Trust Fund
SEC. 14244. EXTENSION OF MOTOR FUEL TAX RATES; INCREASED DEPOSITS INTO
HIGHWAY TRUST FUND.
(a) In General.--Clause (i) of section 4081(a)(2)(B), as amended by
subpart B, is amended--
(1) by striking ``11.5 cents'' and inserting ``14 cents'',
and
(2) by striking ``17.5 cents'' and inserting ``20 cents''.
(b) Conforming Amendments.--
(1) Subparagraph (A) of section 4081(c)(4), as so amended,
is amended to read as follows:
``(A) In general.--In the case of the Highway Trust
Fund financing rate, the otherwise applicable rate for
gasoline in a qualified alcohol mixture is--
``(i) 8.6 cents a gallon for 10 percent
gasohol,
``(ii) 9.842 cents a gallon for 7.7 percent
gasohol, and
``(iii) 10.922 cents a gallon for 5.7
percent gasohol.
In the case of a mixture none of the alcohol in which consists
of ethanol, clauses (i), (ii), and (iii) shall be applied by
substituting `8.0 cents' for `8.6 cents', `9.38 cents' for
`9.842 cents', and `10.58 cents' for `10.922'.''
(2) Paragraph (5) of section 4081(c), as so amended, is
amended--
(A) by striking ``12.1 cents'' and inserting ``14.6
cents'', and
(B) by striking ``11.5 cents'' and inserting
``14.0''.
(3) Subparagraph (A) of section 4041(m)(1) is amended to
read as follows:
``(A) under subsection (a)(2) the Highway Trust
Fund financing shall be 7 cents per gallon, and''.
(4) Paragraph (4) of section 6427(l), as amended by subpart
B, is amended--
(A) by striking ``the deficit reduction rate'' and
inserting ``2.5 cents per gallon of the Highway Trust
Fund financing rate'', and
(B) by striking ``deficit reduction tax'' in the
heading and inserting ``portion of tax''.
(5) Subsection (b) of section 9503 is amended by adding at
the end thereof the following new paragraph:
``(6) Retention of certain taxes in general fund.--
``(A) In general.--There shall not be taken into
account under paragraphs (1) and (2)--
``(i) the tax imposed by section 4081 on
diesel fuel used in any train, and
``(ii) so much of the following taxes as
are attributable to 2.5 cents of the Highway
Trust Fund financing rate:
``(I) Motorboat fuel taxes (as
defined in subsection (c)(4)(D)).
``(II) Small-engine fuel taxes (as
defined in subsection (c)(5)(B)).
``(III) Nonhighway recreational
fuel taxes (as defined in subsection
(c)(6)(D)).
``(B) Transfers from highway trust fund.--For
purposes of determining the amount paid from the
Highway Trust Fund under paragraphs (4), (5), and (6)
of subsection (c), the Highway Trust Fund financing
rates shall be treated as being 2.5 cents less than the
otherwise applicable rates.''
(c) Increase in Deposits in Mass Transit Account.--Paragraph (2) of
section 9503(e) is amended by striking ``1.5 cents'' and inserting ``2
cents''.
(d) Repeal of Expired Provisions.--
(1) Subparagraph (A) of section 4081(a)(2) (relating to
rate of tax), as amended by subpart B, is amended--
(A) by adding ``and'' at the end of clause (i),
(B) by striking ``, and'' at the end of clause (ii)
and inserting a period, and
(C) by striking clause (iii).
(2) Subparagraph (B) of section 4081(a)(2), as so amended,
is amended--
(A) by adding ``and'' at the end of clause (i),
(B) by striking ``, and'' at the end of clause (ii)
and inserting a period, and
(C) by striking clause (iii).
(3) Subsection (d) of section 4081, as so amended, is
amended by striking paragraph (3).
(4) Paragraphs (1) and (2) of section 4041(a) (as so
amended), and paragraph (3) of section 4041(c), are each
amended by striking ``the sum of the Highway Trust Fund
financing rate and the diesel fuel deficit reduction rate'' and
by inserting ``the Highway Trust Fund financing rate''.
(5) Clause (ii) of section 4041(a)(1)(C), as so amended, is
amended--
(A) by striking ``The Highway Trust Fund financing
rate'' and inserting ``So much of the Highway Trust
Fund financing rate as exceeds 2.5 cents per gallon'',
and
(B) by striking ``Highway rate'' in the heading and
inserting ``Portion of highway rate''.
(6) Clause (iii) of section 4041(a)(1)(C), as so amended,
is amended by striking ``and the deficit reduction rate shall
not apply''.
(e) Effective Date.--The amendments made by this section shall take
effect October 1, 1995, but the amendment made by subsection (c) shall
apply only to amounts attributable to taxes imposed on or after such
date.
PART V--COMPLIANCE PROVISIONS
SEC. 14251. REPORTING REQUIRED FOR CERTAIN PAYMENTS TO CORPORATIONS.
(a) Section 6041.--Section 6041 (relating to information at source)
is amended by adding at the end thereof the following new subsection:
``(f) Special Rules for Payments for Services.--No payment for the
performance of services shall be exempt from the requirements of this
section merely because it is a payment to a corporation.''
(b) Section 6041A(a).--Subsection (a) of section 6041A is amended
by adding at the end thereof the following new sentence: ``A payment
shall not be exempt from the requirements of this subsection merely
because it is a payment to a corporation.''.
(c) Effective Date.--The amendments made by this section shall
apply to payments made after December 31, 1993.
SEC. 14252. MODIFICATIONS TO SUBSTANTIAL UNDERSTATEMENT AND RETURN-
PREPARER PENALTIES.
(a) Reasonable Basis Required.--
(1) Substantial understatement penalty.--Clause (ii) of
section 6662(d)(2)(B) (relating to reduction for understatement
due to position of taxpayer or disclosed item) is amended to
read as follows:
``(ii) any item if--
``(I) the relevant facts affecting
the item's tax treatment are adequately
disclosed in the return or in a
statement attached to the return, and
``(II) there is a reasonable basis
for the tax treatment of such item by
the taxpayer.''
(2) Return preparer penalty.--Paragraph (3) of section
6694(a) (relating to understatement of taxpayer's liability by
income tax return preparer) is amended to read as follows:
``(3) the requirements of subclauses (I) and (II) of
section 6662(d)(2)(B)(ii) are not satisfied with respect to
such position,''.
(b) Special Tax Shelter Rule.--Subclause (II) of section
6662(d)(2)(C)(i) (relating to special rules for tax shelters) is
amended by inserting before the period at the end thereof the
following: ``and the reasonably anticipated after-tax benefits from the
taxpayer's investment in such shelter do not significantly exceed the
reasonably anticipated pre-tax economic profit or loss from such
investment''.
(c) Reasonable Cause Exception.--Paragraph (1) of section 6664(c)
is revised by striking ``this part'' and inserting ``section 6662''.
(d) Effective Date.--The amendments made by this section shall
apply to returns the due dates for which (determined without regard to
extensions) are after December 31, 1993.
SEC. 14253. RETURNS RELATING TO THE CANCELLATION OF INDEBTEDNESS BY
CERTAIN FINANCIAL ENTITIES.
(a) In General.--Subpart B of part III of subchapter A of chapter
61 (relating to information concerning transactions with other persons)
is amended by adding at the end thereof the following new section:
``SEC. 6050P. RETURNS RELATING TO THE CANCELLATION OF INDEBTEDNESS BY
CERTAIN FINANCIAL ENTITIES.
``(a) In General.--Any applicable financial entity which discharges
(in whole or in part) the indebtedness of any person during any
calendar year shall make a return (at such time and in such form as the
Secretary may by regulations prescribe) setting forth--
``(1) the name, address, and TIN of each person whose
indebtedness was discharged during such calendar year,
``(2) the date of the discharge and the amount of the
indebtedness discharged, and
``(3) such other information as the Secretary may
prescribe.
``(b) Exception.--Subsection (a) shall not apply to any discharge
of less than $600.
``(c) Definitions and Special Rules.--For purposes of this
section--
``(1) Applicable financial entity.--The term `applicable
financial entity' means--
``(A) any financial institution described in
section 581 or 591(a) and any credit union,
``(B) the Federal Deposit Insurance Corporation,
the Resolution Trust Corporation, and the National
Credit Union Administration, and any successor or
subunit of any of the foregoing, and
``(C) any other corporation which is a direct or
indirect subsidiary of an entity referred to in
subparagraph (A) but only if, by virtue of being
affiliated with such entity, such other corporation is
subject to supervision and examination by a Federal or
State agency which regulates entities referred to in
subparagraph (A).
``(2) Governmental units.--In the case of an entity
described in paragraph (1)(B), any return under this section
shall be made by the officer or employee appropriately
designated for the purpose of making such return.
``(d) Statements To Be Furnished to Persons With Respect to Whom
Information Is Required To Be Furnished.--Every applicable financial
entity required to make a return under subsection (a) shall furnish to
each person whose name is required to be set forth in such return a
written statement showing--
``(1) the name and address of the entity required to make
such return, and
``(2) the information required to be shown on the return
with respect to such person.
The written statement required under the preceding sentence shall be
furnished to the person on or before January 31 of the year following
the calendar year for which the return under subsection (a) was made.''
(b) Penalties.--
(1) Returns.--Subparagraph (B) of section 6724(d)(1) is
amended by redesignating clauses (viii) through (xv) as clauses
(ix) through (xvi), respectively, and by inserting after clause
(vii) the following new clause:
``(viii) section 6050P (relating to returns
relating to the cancellation of indebtedness by
certain financial entities),''.
(2) Statements.--Paragraph (2) of section 6724(d) is
amended by redesignating subparagraphs (P) through (S) as
subparagraphs (Q) through (T), respectively, and by inserting
after subparagraph (O) the following new subparagraph:
``(P) section 6050P(d) (relating to returns
relating to the cancellation of indebtedness by certain
financial entities),''.
(c) Clerical Amendment.--The table of sections for subpart B of
part III of subchapter A of chapter 61 is amended by adding at the end
thereof the following new item:
``Sec. 6050P. Returns relating to the
cancellation of indebtedness by
certain financial entities.''
(d) Effective Date.--The amendments made by this section shall
apply to discharges of indebtedness after the date of the enactment of
this Act.
PART VI--TREATMENT OF INTANGIBLES
SEC. 14261. AMORTIZATION OF GOODWILL AND CERTAIN OTHER INTANGIBLES.
(a) General Rule.--Part VI of subchapter B of chapter 1 (relating
to itemized deductions for individuals and corporations) is amended by
adding at the end thereof the following new section:
``SEC. 197. AMORTIZATION OF GOODWILL AND CERTAIN OTHER INTANGIBLES.
``(a) General Rule.--A taxpayer shall be entitled to an
amortization deduction with respect to any amortizable section 197
intangible. The amount of such deduction shall be determined by
amortizing the adjusted basis (for purposes of determining gain) of
such intangible ratably over the 14-year period beginning with the
month in which such intangible was acquired.
``(b) No Other Depreciation or Amortization Deduction Allowable.--
Except as provided in subsection (a), no depreciation or amortization
deduction shall be allowable with respect to any amortizable section
197 intangible.
``(c) Amortizable Section 197 Intangible.--For purposes of this
section--
``(1) In general.--Except as otherwise provided in this
section, the term `amortizable section 197 intangible' means
any section 197 intangible--
``(A) which is acquired by the taxpayer after the
date of the enactment of this section, and
``(B) which is held in connection with the conduct
of a trade or business or an activity described in
section 212.
``(2) Exclusion of self-created intangibles, etc.--The term
`amortizable section 197 intangible' shall not include any
section 197 intangible--
``(A) which is not described in subparagraph (D),
(E), or (F) of subsection (d)(1), and
``(B) which is created by the taxpayer.
This paragraph shall not apply if the intangible is created in
connection with a transaction (or series of related
transactions) involving the acquisition of assets constituting
a trade or business or substantial portion thereof.
``(3) Anti-churning rules.--
``For exclusion of intangibles acquired
in certain transactions, see subsection (f)(9).
``(d) Section 197 Intangible.--For purposes of this section--
``(1) In general.--Except as otherwise provided in this
section, the term `section 197 intangible' means--
``(A) goodwill,
``(B) going concern value,
``(C) any of the following intangible items:
``(i) workforce in place including its
composition and terms and conditions
(contractual or otherwise) of its employment,
``(ii) business books and records,
operating systems, or any other information
base (including lists or other information with
respect to current or prospective customers),
``(iii) any patent, copyright, formula,
process, design, pattern, knowhow, format, or
other similar item,
``(iv) any customer-based intangible,
``(v) any supplier-based intangible, and
``(vi) any other similar item,
``(D) any license, permit, or other right granted
by a governmental unit or an agency or instrumentality
thereof,
``(E) any covenant not to compete (or other
arrangement to the extent such arrangement has
substantially the same effect as a covenant not to
compete) entered into in connection with an acquisition
(directly or indirectly) of an interest in a trade or
business or substantial portion thereof, and
``(F) any franchise, trademark, or trade name.
``(2) Customer-based intangible.--
``(A) In general.--The term `customer-based
intangible' means--
``(i) composition of market,
``(ii) market share, and
``(iii) any other value resulting from
future provision of goods or services pursuant
to relationships (contractual or otherwise) in
the ordinary course of business with customers.
``(B) Special rule for financial institutions.--In
the case of a financial institution, the term
`customer-based intangible' includes deposit base and
similar items.
``(3) Supplier-based intangible.--The term `supplier-based
intangible' means any value resulting from future acquisitions
of goods or services pursuant to relationships (contractual or
otherwise) in the ordinary course of business with suppliers of
goods or services to be used or sold by the taxpayer.
``(e) Exceptions.--For purposes of this section, the term `section
197 intangible' shall not include any of the following:
``(1) Financial interests.--Any interest--
``(A) in a corporation, partnership, trust, or
estate, or
``(B) under an existing futures contract, foreign
currency contract, notional principal contract, or
other similar financial contract.
``(2) Land.--Any interest in land.
``(3) Computer software.--
``(A) In general.--Any--
``(i) computer software which is readily
available for purchase by the general public,
is subject to a nonexclusive license, and has
not been substantially modified, and
``(ii) other computer software which is not
acquired in a transaction (or series of related
transactions) involving the acquisition of
assets constituting a trade or business or
substantial portion thereof.
``(B) Computer software defined.--For purposes of
subparagraph (A), the term `computer software' means
any program designed to cause a computer to perform a
desired function. Such term shall not include any data
base or similar item unless the data base or item is in
the public domain and is incidental to the operation of
otherwise qualifying computer software.
``(4) Certain interests or rights acquired separately.--Any
of the following not acquired in a transaction (or series of
related transactions) involving the acquisition of assets
constituting a trade business or substantial portion thereof:
``(A) Any interest in a film, sound recording,
video tape, book, or similar property.
``(B) Any right to receive tangible property or
services under a contract or granted by a governmental
unit or agency or instrumentality thereof.
``(C) Any interest in a patent or copyright.
``(D) To the extent provided in regulations, any
right under a contract (or granted by a governmental
unit or an agency or instrumentality thereof) if such
right--
``(i) has a fixed duration of less than 14
years, or
``(ii) is fixed as to amount and, without
regard to this section, would be recoverable
under a method similar to the unit-of-
production method.
``(5) Interests under leases and debt instruments.--Any
interest under--
``(A) an existing lease of tangible property, or
``(B) except as provided in subsection (d)(2)(B),
any existing indebtedness.
``(6) Treatment of sports franchises.--A franchise to
engage in professional football, basketball, baseball, or other
professional sport, and any item acquired in connection with
such a franchise.
``(7) Certain transaction costs.--Any fees for professional
services, and any transaction costs, incurred by parties to a
transaction with respect to which any portion of the gain or
loss is not recognized under part III of subchapter C.
``(f) Special Rules.--
``(1) Treatment of certain dispositions, etc.--If there is
a disposition of any amortizable section 197 intangible
acquired in a transaction or series of related transactions (or
any such intangible becomes worthless) and one or more other
amortizable section 197 intangibles acquired in such
transaction or series of related transactions are retained--
``(A) no loss shall be recognized by reason of such
disposition (or such worthlessness), and
``(B) appropriate adjustments to the adjusted bases
of such retained intangibles shall be made for any loss
not recognized under subparagraph (A).
All persons treated as a single taxpayer under section 41(f)(1)
shall be so treated for purposes of the preceding sentence.
``(2) Treatment of certain transfers.--
``(A) In general.--In the case of any section 197
intangible transferred in a transaction described in
subparagraph (B), the transferee shall be treated as
the transferor for purposes of applying this section
with respect to so much of the adjusted basis in the
hands of the transferee as does not exceed the adjusted
basis in the hands of the transferor.
``(B) Transactions covered.--The transactions
described in this subparagraph are--
``(i) any transaction described in section
332, 351, 361, 721, 731, 1031, or 1033, and
``(ii) any transaction between members of
the same affiliated group during any taxable
year for which a consolidated return is made by
such group.
``(3) Treatment of amounts paid pursuant to covenants not
to compete, etc.--Any amount paid or incurred pursuant to a
covenant or arrangement referred to in subsection (d)(1)(E)
shall be treated as an amount chargeable to capital account.
``(4) Treatment of franchises, etc.--
``(A) Franchise.--The term `franchise' has the
meaning given to such term by section 1253(b)(1).
``(B) Treatment of renewals.--Any renewal of a
franchise, trademark, or trade name (or of a license, a
permit, or other right referred to in subsection
(d)(1)(D)) shall be treated as an acquisition. The
preceding sentence shall only apply with respect to
costs incurred in connection with such renewal.
``(C) Certain amounts not taken into account.--Any
amount to which section 1253(d)(1) applies shall not be
taken into account under this section.
``(5) Treatment of certain reinsurance transactions.--In
the case of any amortizable section 197 intangible resulting
from an assumption reinsurance transaction, the amount taken
into account as the adjusted basis of such intangible under
this section shall be the excess of--
``(A) the amount paid or incurred by the acquirer
under the assumption reinsurance transaction, over
``(B) the amount required to be capitalized under
section 848 in connection with such transaction.
Subsection (b) shall not apply to any amount required to be
capitalized under section 848.
``(6) Treatment of certain subleases.--For purposes of this
section, a sublease shall be treated in the same manner as a
lease of the underlying property involved.
``(7) Treatment as depreciable.--For purposes of this
chapter, any amortizable section 197 intangible shall be
treated as property which is of a character subject to the
allowance for depreciation provided in section 167.
``(8) Treatment of certain increments in value.--This
section shall not apply to any increment in value if, without
regard to this section, such increment is properly taken into
account in determining the cost of property which is not a
section 197 intangible.
``(9) Anti-churning rules.--For purposes of this section--
``(A) In general.--The term `amortizable section
197 intangible' shall not include any section 197
intangible which is described in subparagraph (A) or
(B) of subsection (d)(1) (or for which depreciation or
amortization would not have been allowable but for this
section) and which is acquired by the taxpayer after
the date of the enactment of this section, if--
``(i) the intangible was held or used at
any time on or after July 25, 1991, and on or
before such date of enactment by the taxpayer
or a related person,
``(ii) the intangible was acquired from a
person who held such intangible at any time on
or after July 25, 1991, and on or before such
date of enactment, and, as part of the
transaction, the user of such intangible does
not change, or
``(iii) the taxpayer grants the right to
use such intangible to a person (or a person
related to such person) who held or used such
intangible at any time on or after July 25,
1991, and on or before such date of enactment.
For purposes of this subparagraph, the determination of
whether the user of property changes as part of a
transaction shall be determined in accordance with
regulations prescribed by the Secretary. For purposes
of this subparagraph, deductions allowable under
section 1253(d) shall be treated as deductions
allowable for amortization.
``(B) Exception where gain recognized.--If--
``(i) subparagraph (A) would not apply to
an intangible acquired by the taxpayer but for
the last sentence of subparagraph (C)(i), and
``(ii) the person from whom the taxpayer
acquired the intangible elects, notwithstanding
any other provision of this title--
``(I) to recognize gain on the
disposition of the intangible, and
``(II) to pay a tax on such gain
which, when added to any other income
tax on such gain under this title,
equals such gain multiplied by the
highest rate of income tax applicable
to such person under this title,
then subparagraph (A) shall apply to the
intangible only to the extent that the
taxpayer's adjusted basis in the intangible
exceeds the gain recognized under clause
(ii)(I).
``(C) Related person defined.--For purposes of this
paragraph--
``(i) Related person.--A person
(hereinafter in this paragraph referred to as
the `related person') is related to any person
if--
``(I) the related person bears a
relationship to such person specified
in section 267(b) or section 707(b)(1),
or
``(II) the related person and such
person are engaged in trades or
businesses under common control (within
the meaning of subparagraphs (A) and
(B) of section 41(f)(1)).
For purposes of subclause (I), in applying
section 267(b) or 707(b)(1), `20 percent' shall
be substituted for `50 percent'.
``(ii) Time for making determination.--A
person shall be treated as related to another
person if such relationship exists immediately
before or immediately after the acquisition of
the intangible involved.
``(D) Acquisitions by reason of death.--
Subparagraph (A) shall not apply to the acquisition of
any property by the taxpayer if the basis of the
property in the hands of the taxpayer is determined
under section 1014(a).
``(E) Special rule for partnerships.--With respect
to any increase in the basis of partnership property
under section 732, 734, or 743, determinations under
this paragraph shall be made at the partner level and
each partner shall be treated as having owned and used
such partner's proportionate share of the partnership
assets.
``(F) Anti-abuse rules.--The term `amortizable
section 197 intangible' does not include any section
197 intangible acquired in a transaction, one of the
principal purposes of which is to avoid the requirement
of subsection (c)(1) that the intangible be acquired
after the date of the enactment of this section or to
avoid the provisions of subparagraph (A).
``(g) Regulations.--The Secretary shall prescribe such regulations
as may be appropriate to carry out the purposes of this section,
including such regulations as may be appropriate to prevent avoidance
of the purposes of this section through related persons or otherwise.''
(b) Modifications to Depreciation Rules.--
(1) Treatment of certain property excluded from section
197.--Section 167 (relating to depreciation deduction) is
amended by redesignating subsection (f) as subsection (g) and
by inserting after subsection (e) the following new subsection:
``(f) Treatment of Certain Property Excluded From Section 197.--
``(1) Computer software.--
``(A) In general.--If a depreciation deduction is
allowable under subsection (a) with respect to any
computer software, such deduction shall be computed by
using the straight line method and a useful life of 36
months.
``(B) Computer software.--For purposes of this
section, the term `computer software' has the meaning
given to such term by section 197(e)(3)(B); except that
such term shall not include any such software which is
an amortizable section 197 intangible.
``(2) Certain interests or rights acquired separately.--If
a depreciation deduction is allowable under subsection (a) with
respect to any property described in subparagraph (B), (C), or
(D) of section 197(e)(4), such deduction shall be computed in
accordance with regulations prescribed by the Secretary.''
(2) Allocation of basis in case of leased property.--
Subsection (c) of section 167 is amended to read as follows:
``(c) Basis for Depreciation.--
``(1) In general.--The basis on which exhaustion, wear and
tear, and obsolescence are to be allowed in respect of any
property shall be the adjusted basis provided in section 1011,
for the purpose of determining the gain on the sale or other
disposition of such property.
``(2) Special rule for property subject to lease.--If any
property is acquired subject to a lease--
``(A) no portion of the adjusted basis shall be
allocated to the leasehold interest, and
``(B) the entire adjusted basis shall be taken into
account in determining the depreciation deduction (if
any) with respect to the property subject to the
lease.''
(c) Amendments to Section 1253.--Subsection (d) of section 1253 is
amended by striking paragraphs (2), (3), (4), and (5) and inserting the
following:
``(2) Other payments.--Any amount paid or incurred on
account of a transfer, sale, or other disposition of a
franchise, trademark, or trade name to which paragraph (1) does
not apply shall be treated as an amount chargeable to capital
account.
``(3) Renewals, etc.--For purposes of determining the term
of a transfer agreement under this section, there shall be
taken into account all renewal options (and any other period
for which the parties reasonably expect the agreement to be
renewed).''
(d) Amendment to Section 848.--Subsection (g) of section 848 is
amended by striking ``this section'' and inserting ``this section or
section 197''.
(e) Amendments to Section 1060.--
(1) Paragraph (1) of section 1060(b) is amended by striking
``goodwill or going concern value'' and inserting ``section 197
intangibles''.
(2) Paragraph (1) of section 1060(d) is amended by striking
``goodwill or going concern value (or similar items)'' and
inserting ``section 197 intangibles''.
(f) Technical and Conforming Amendments.--
(1) Subsection (g) of section 167 (as redesignated by
subsection (b)) is amended to read as follows:
``(g) Cross References.--
``(1) For additional rule applicable to
depreciation of improvements in the case of mines, oil and gas wells,
other natural deposits, and timber, see section 611.
``(2) For amortization of goodwill and
certain other intangibles, see section 197.''
(2) Subsection (f) of section 642 is amended by striking
``section 169'' and inserting ``sections 169 and 197''.
(3) Subsection (a) of section 1016 is amended by striking
paragraph (19) and by redesignating the following paragraphs
accordingly.
(4) Subparagraph (C) of section 1245(a)(2) is amended by
striking ``193, or 1253(d) (2) or (3)'' and inserting ``or
193''.
(5) Paragraph (3) of section 1245(a) is amended by striking
``section 185 or 1253(d) (2) or (3)''.
(6) The table of sections for part VI of subchapter B of
chapter 1 is amended by adding at the end thereof the following
new item:
``Sec. 197. Amortization of goodwill and
certain other intangibles.''.
(g) Effective Date.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall apply
with respect to property acquired after the date of the
enactment of this Act.
(2) Election to have amendments apply to property acquired
after july 25, 1991.--
(A) In general.--If an election under this
paragraph applies to the taxpayer--
(i) the amendments made by this section
shall apply to property acquired by the
taxpayer after July 25, 1991,
(ii) subsection (c)(1)(A) of section 197 of
the Internal Revenue Code of 1986 (as added by
this section) (and so much of subsection
(f)(9)(A) of such section 197 as precedes
clause (i) thereof) shall be applied with
respect to the taxpayer by treating July 25,
1991, as the date of the enactment of such
section, and
(iii) in applying subsection (f)(9) of such
section, with respect to any property acquired
by the taxpayer on or before the date of the
enactment of this Act, only holding or use on
July 25, 1991, shall be taken into account.
(B) Election.--An election under this paragraph
shall be made at such time and in such manner as the
Secretary of the Treasury or his delegate may
prescribe. Such an election by any taxpayer, once
made--
(i) may be revoked only with the consent of
the Secretary, and
(ii) shall apply to the taxpayer making
such election and any other taxpayer under
common control with the taxpayer (within the
meaning of subparagraphs (A) and (B) of section
41(f)(1) of such Code) at any time after
November 22, 1991, and on or before the date on
which such election is made.
(3) Elective binding contract exception.--
(A) In general.--The amendments made by this
section shall not apply to any acquisition of property
by the taxpayer if--
(i) such acquisition is pursuant to a
written binding contract in effect on the date
of the enactment of this Act and at all times
thereafter before such acquisition,
(ii) an election under paragraph (2) does
not apply to the taxpayer, and
(iii) the taxpayer makes an election under
this paragraph with respect to such contract.
(B) Election.--An election under this paragraph
shall be made at such time and in such manner as the
Secretary of the Treasury or his delegate shall
prescribe. Such an election, once made--
(i) may be revoked only with the consent of
the Secretary, and
(ii) shall apply to all property acquired
pursuant to the contract with respect to which
such election was made.
(h) Annual Reports.--The Secretary of the Treasury shall submit
annual reports to the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the Senate on the
implementation and effects of the amendments made by this section,
including the effects of such amendments on merger and acquisition
activities. The first such annual report shall be submitted on or
before December 31, 1994.
(i) Annual Reports on Outstanding Cases.--The Secretary of the
Treasury shall submit annual reports to the Committee on Ways and Means
of the House of Representatives and the Committee on Finance of the
Senate regarding the volume of cases still outstanding that involve
disputes regarding the amortization of intangibles, progress made in
resolving such cases, efforts made to coordinate settlement
proceedings, and factors inhibiting the resolution of such cases. The
report shall also address the impact of the amendments made by this
section on the volume of disputes regarding the amortization of
intangibles. The first such annual report shall be submitted on or
before December 31, 1994.
SEC. 14262. TREATMENT OF CERTAIN PAYMENTS TO RETIRED OR DECEASED
PARTNER.
(a) Section 736(b) Not To Apply in Certain Cases.--Subsection (b)
of section 736 (relating to payments for interest in partnership) is
amended by adding at the end thereof the following new paragraph:
``(3) Limitation on application of paragraph (2).--
Paragraph (2) shall apply only if--
``(A) capital is not a material income-producing
factor for the partnership, and
``(B) the retiring or deceased partner was a
general partner in the partnership.''
(b) Limitation on Definition of Unrealized Receivables.--
(1) In general.--Subsection (c) of section 751 (defining
unrealized receivables) is amended--
(A) by striking ``sections 731, 736, and 741'' each
place they appear and inserting ``, sections 731 and
741 (but not for purposes of section 736)'', and
(B) by striking ``section 731, 736, or 741'' each
place it appears and inserting ``section 731 or 741''.
(2) Technical amendments.--
(A) Subsection (e) of section 751 is amended by
striking ``sections 731, 736, and 741'' and inserting
``sections 731 and 741''.
(B) Section 736 is amended by striking subsection
(c).
(c) Effective Date.--
(1) In general.--The amendments made by this section shall
apply in the case of partners retiring or dying on or after
January 5, 1993.
(2) Binding contract exception.--The amendments made by
this section shall not apply to any partner retiring on or
after January 5, 1993, if a written contract to purchase such
partner's interest in the partnership was binding on January 4,
1993, and at all times thereafter before such purchase.
PART VII--MISCELLANEOUS PROVISIONS
SEC. 14271. SUBSTANTIATION REQUIREMENT FOR DEDUCTION OF CERTAIN
CHARITABLE CONTRIBUTIONS.
(a) Substantiation Requirement.--Section 170(f) (providing special
rules relating to the deduction of charitable contributions and gifts)
is amended by adding at the end the following new paragraph:
``(8) Substantiation requirement for certain
contributions.--
``(A) General rule.--No deduction shall be allowed
under subsection (a) for any contribution of $750 or
more unless the taxpayer substantiates the contribution
by a contemporaneous written acknowledgment of the
contribution by the donee organization that meets the
requirements of subparagraph (B).
``(B) Content of acknowledgment.--An acknowledgment
meets the requirements of this subparagraph if it
provides information sufficient to substantiate the
amount of the deductible contribution. If the
contribution was made by means of a payment part of
which constituted consideration for goods or services
provided by the donee organization, the acknowledgment
must provide a good faith estimate of the value of such
goods or services.
``(C) Contemporaneous.--For purposes of
subparagraph (A), an acknowledgment shall be considered
to be contemporaneous if the taxpayer obtains the
acknowledgment on or before the earlier of--
``(i) the date on which the taxpayer files
a return for the taxable year in which the
contribution was made, or
``(ii) the due date (including extensions)
for filing such return.
``(D) Substantiation not required for contributions
reported by the donee organization.--Subparagraph (A)
shall not apply to a contribution if the donee
organization files a return, on such form and in
accordance with such regulations as the Secretary may
prescribe, which includes the information described in
subparagraph (B) with respect to the contribution.
``(E) Regulations.--The Secretary shall prescribe
such regulations as may be necessary or appropriate to
carry out the purposes of this paragraph, including
regulations that may provide that some or all of the
requirements of this paragraph do not apply in
appropriate cases.''
(b) Effective Date.--The provisions of this section shall apply to
contributions made on or after January 1, 1994.
SEC. 14272. DISCLOSURE RELATED TO QUID PRO QUO CONTRIBUTIONS.
(a) Disclosure Requirement.--Subchapter B of chapter 61 (relating
to information and returns) is amended by redesignating section 6115 as
section 6116 and by inserting after section 6114 the following new
section:
``SEC. 6115. DISCLOSURE RELATED TO QUID PRO QUO CONTRIBUTIONS.
``(a) Disclosure Requirement.--If an organization described in
section 170(c) (other than paragraph (1) thereof) receives a quid pro
quo contribution, the organization shall, in connection with the
solicitation or receipt of the contribution--
``(1) inform the donor that the amount of the contribution
that is deductible for Federal income tax purposes is limited
to the excess of the amount of any money and the value of any
property other than money contributed by the donor over the
value of the goods or services provided by the organization,
and
``(2) provide the donor with a good faith estimate of the
value of such goods or services.
``(b) Quid Pro Quo Contribution.--For purposes of this section, the
term `quid pro quo contribution' means a payment made partly as a
contribution and partly in consideration for goods or services provided
to the payor by the donee organization.''
(b) Penalty for Failure To Disclose.--Part I of subchapter B of
chapter 68 (relating to assessable penalties) is amended by inserting
after section 6713 the following new section:
``SEC. 6714. FAILURE TO MEET DISCLOSURE REQUIREMENTS APPLICABLE TO QUID
PRO QUO CONTRIBUTIONS.
``(a) Imposition of Penalty.--If an organization fails to meet the
disclosure requirement of section 6115 with respect to a quid pro quo
contribution, such organization shall pay a penalty of $10 for each
contribution in respect of which the organization fails to make the
required disclosure, except that the total penalty imposed by this
subsection with respect to a particular fundraising event or mailing
shall not exceed $5,000.
``(b) Reasonable Cause Exception.--No penalty shall be imposed
under this section with respect to any failure if it is shown that such
failure is due to reasonable cause.''
(c) Clerical Amendments.--
(1) The table for subchapter B of chapter 61 is amended by
striking the item relating to section 6115 and inserting the
following new item:
``Sec. 6115. Disclosure related to quid
pro quo contributions.
``Sec. 6116. Cross reference.''
(2) The table for part I of subchapter B of chapter 68 is
amended by inserting after the item for section 6713 the
following new item:
``Sec. 6714. Failure to meet disclosure
requirements applicable to quid
pro quo contributions.''
(d) Effective Date.--The provisions of this section shall apply to
quid pro quo contributions made on or after January 1, 1994.
SEC. 14273. DISALLOWANCE OF INTEREST ON CERTAIN OVERPAYMENTS OF TAX.
(a) General Rule.--Subsection (e) of section 6611 is amended to
read as follows:
``(e) Disallowance of Interest on Certain Overpayments.--
``(1) Refunds within 45 days after return is filed.--If any
overpayment of tax imposed by this title is refunded within 45
days after the last day prescribed for filing the return of
such tax (determined without regard to any extension of time
for filing the return) or, in the case of a return filed after
such last date, is refunded within 45 days after the date the
return is filed, no interest shall be allowed under subsection
(a) on such overpayment.
``(2) Refunds after claim for credit or refund.--If--
``(A) the taxpayer files a claim for a credit or
refund for any overpayment of tax imposed by this
title, and
``(B) such overpayment is refunded within 45 days
after such claim is filed,
no interest shall be allowed on such overpayment from the date
the claim is filed until the day the refund is made.
``(3) IRS initiated adjustments.--If an adjustment
initiated by the Secretary, results in a refund or credit of an
overpayment, interest on such overpayment shall be computed by
subtracting 45 days from the number of days interest would
otherwise be allowed with respect to such overpayment.''
(b) Effective Dates.--
(1) Paragraph (1) of section 6611(e) of the Internal
Revenue Code of 1986 (as amended by subsection (a)) shall apply
in the case of returns the due date for which (determined
without regard to extensions) is on or after January 1, 1994.
(2) Paragraph (2) of section 6611(e) of such Code (as so
amended) shall apply in the case of claims for credit or refund
of any overpayment filed on or after January 1, 1995,
regardless of the taxable period to which such refund relates.
(3) Paragraph (3) of section 6611(e) of such Code (as so
amended) shall apply in the case of any refund paid on or after
January 1, 1995, regardless of the taxable period to which such
refund relates.
SEC. 14274. DENIAL OF DEDUCTION RELATING TO TRAVEL EXPENSES.
(a) In General.--Section 274(m) (relating to additional limitations
on travel expenses) is amended by adding at the end thereof the
following new paragraph:
``(3) Travel expenses of spouse, dependent, or others.--No
deduction shall be allowed under this chapter (other than
section 217) for travel expenses paid or incurred with respect
to a spouse, dependent, or other individual accompanying the
taxpayer (or an officer or employee of the taxpayer) on
business travel, unless--
``(A) the spouse, dependent, or other individual is
an employee of the taxpayer,
``(B) the travel of the spouse, dependent, or other
individual is for a bona fide business purpose, and
``(C) such expenses would otherwise be deductible
by the spouse, dependent, or other individual.''
(b) Effective Date.--The amendment made by this section shall apply
to amounts paid or incurred after December 31, 1993.
SEC. 14275. INCREASE IN WITHHOLDING FROM SUPPLEMENTAL WAGE PAYMENTS.
If an employer elects under Treasury Regulation 31.3402 (g)-1 to
determine the amount to be deducted and withheld from any supplemental
wage payment by using a flat percentage rate, the rate to be used in
determining the amount to be so deducted and withheld shall not be less
than 28 percent. The preceding sentence shall apply to payments made
after December 31, 1993.
Subtitle C--Empowerment Zones and Enterprise Communities, Etc.
PART I--EMPOWERMENT ZONES AND ENTERPRISE COMMUNITIES
SEC. 14301. DESIGNATION AND TREATMENT OF EMPOWERMENT ZONES AND
ENTERPRISE COMMUNITIES.
(a) In General.--Chapter 1 (relating to normal taxes and surtaxes)
is amended by inserting after subchapter T the following new
subchapter:
``Subchapter U--Designation and Treatment of Empowerment Zones and
Enterprise Communities
``Part I. Designation.
``Part II. Incentives for empowerment
zones and enterprise
communities.
``Part III. Additional incentives for
empowerment zones.
``Part IV. Regulations.
``PART I--DESIGNATION
``Sec. 1391. Designation procedure.
``Sec. 1392. Eligibility criteria.
``Sec. 1393. Definitions and special
rules.
``SEC. 1391. DESIGNATION PROCEDURE.
``(a) In General.--From among the areas nominated for designation
under this section, the appropriate Secretaries may, in consultation
with the Enterprise Board, designate empowerment zones and enterprise
communities.
``(b) Number of Designations.--
``(1) Enterprise communities.--The appropriate Secretaries
may designate in the aggregate 100 nominated areas as
enterprise communities under this section, subject to the
availability of eligible nominated areas. Of that number, not
more than 65 may be designated in urban areas, not more than 30
may be designated in rural areas, and not more than 5 may be
designated by the Secretary of the Interior in Indian
reservations.
``(2) Empowerment zones.--The appropriate Secretaries may
designate in the aggregate 10 nominated areas as empowerment
zones under this section, subject to the availability of
eligible nominated areas. Of that number, not more than 6 may
be designated in urban areas, not more than 3 may be designated
in rural areas, and not more than 1 may be designated by the
Secretary of the Interior in an Indian reservation. If 6
empowerment zones are designated in urban areas, no less than 1
shall be designated in an urban area the most populous city of
which has a population of 500,000 or less. The Secretary of
Housing and Urban Development shall designate empowerment zones
located in urban areas in such a manner that the aggregate
population of all such zones does not exceed 750,000.
``(c) Period Designations May Be Made.--A designation may be made
under this section only after 1993 and before 1996.
``(d) Period for Which Designation Is In Effect.--
``(1) In general.--Any designation under this section shall
remain in effect during the period beginning on the date of the
designation and ending on the earliest of--
``(A) the close of the 10th calendar year beginning
on or after such date of designation,
``(B) the termination date designated by the State
and local governments as provided for in their
nomination, or
``(C) the date the appropriate Secretary revokes
the designation.
``(2) Revocation of designation.--
``(A) In general.--The appropriate Secretary, in
consultation with the Enterprise Board, may revoke the
designation under this section of an area if such
Secretary determines that the local government or the
State in which it is located--
``(i) has modified the boundaries of the
area, or
``(ii) is not complying substantially with,
or fails to make progress in achieving the
benchmarks set forth in, the strategic plan
under subsection (f)(2).
``(B) Applicable procedures.--A designation may be
revoked by the appropriate Secretary under subparagraph
(A) only after a hearing on the record involving
officials of the State or local government involved.
``(e) Limitations on Designations.--An area may be designated under
subsection (a) only if--
``(1) the area is nominated by 1 or more local governments
and the State or States in which it is located for designation
under this section,
``(2) such State or States and the local governments have
the authority--
``(A) to nominate the area for designation under
this section, and
``(B) to provide the assurances described in
paragraph (3),
``(3) such State or States and the local governments
provide written assurances satisfactory to the appropriate
Secretary that the strategic plan described in the application
under subsection (f)(2) for such area will be implemented,
``(4) the appropriate Secretary determines that any
information furnished is reasonably accurate, and
``(5) such State or States and local governments certify
that no portion of the area nominated is already included in an
empowerment zone or in an enterprise community or in an area
otherwise nominated to be designated under this section.
``(f) Application.--An application for designation as an
empowerment zone or as an enterprise community shall--
``(1) demonstrate that the nominated area satisfies the
eligibility criteria described in section 1392,
``(2) include a strategic plan for accomplishing the
purposes of this subchapter that--
``(A) describes the coordinated economic, human,
community, and physical development plan and related
activities proposed for the nominated area,
``(B) describes the process by which the affected
community is a full partner in the process of
developing and implementing the plan and the extent to
which local institutions and organizations have
contributed to the planning process,
``(C) identifies the amount of State, local, and
private resources that will be available in the
nominated area and the private/public partnerships to
be used, which may include participation by, and
cooperation with, universities, medical centers, and
other private and public entities,
``(D) identifies the funding requested under any
Federal program in support of the proposed economic,
human, community, and physical development and related
activities,
``(E) identifies baselines, methods, and benchmarks
for measuring the success of carrying out the strategic
plan, including the extent to which poor persons and
families will be empowered to become economically self-
sufficient, and
``(F) does not include any action to assist any
establishment in relocating from one area outside the
nominated area to the nominated area, except that
assistance for the expansion of an existing business
entity through the establishment of a new branch,
affiliate, or subsidiary is permitted if--
``(i) the establishment of the new branch,
affiliate, or subsidiary will not result in a
decrease in employment in the area of original
location or in any other area where the
existing business entity conducts business
operations, and
``(ii) there is no reason to believe that
the new branch, affiliate, or subsidiary is
being established with the intention of closing
down the operations of the existing business
entity in the area of its original location or
in any other area where the existing business
entity conducts business operation, and
``(3) include such other information as may be required by
the appropriate Secretary or the Enterprise Board.
``SEC. 1392. ELIGIBILITY CRITERIA.
``(a) In General.--A nominated area shall be eligible for
designation under section 1391 only if it meets the following criteria:
``(1) Population.--The nominated area has a maximum
population of--
``(A) in the case of an urban area, the lesser of--
``(i) 200,000, or
``(ii) the greater of 50,000 or 10 percent
of the population of the most populous city
located within the nominated area, and
``(B) in the case of a rural area, 30,000.
``(2) Distress.--The nominated area is one of pervasive
poverty, unemployment, and general distress.
``(3) Size.--The nominated area--
``(A) does not exceed 20 square miles if an urban
area or 1,000 square miles if a rural area or an Indian
reservation,
``(B) has a boundary which is continuous, or,
except in the case of a rural area located in more than
1 State, consists of not more than 3 noncontiguous
parcels,
``(C)(i) in the case of an urban area, is located
entirely within no more than 2 contiguous States, and
``(ii) in the case of a rural area, is located
entirely within no more than 3 contiguous States, and
``(D) does not include any portion of a central
business district (as such term is used for purposes of
the most recent Census of Retail Trade) unless the
poverty rate for each population census tract in such
district is not less than 35 percent (30 percent in the
case of an enterprise community).
``(4) Poverty rate.--The poverty rate--
``(A) for each population census tract within the
nominated area is not less than 20 percent,
``(B) for at least 90 percent of the population
census tracts within the nominated area is not less
than 25 percent, and
``(C) for at least 50 percent of the population
census tracts within the nominated area is not less
than 35 percent.
``(b) Special Rules Relating to Determination of Poverty Rate.--For
purposes of subsection (a)(4)--
``(1) Treatment of census tracts with small populations.--
``(A) Tracts with no population.--In the case of a
population census tract with no population--
``(i) such tract shall be treated as having
a poverty rate which meets the requirements of
subparagraphs (A) and (B) of subsection (a)(4),
but
``(ii) such tract shall be treated as
having a zero poverty rate for purposes of
applying subparagraph (C) thereof.
``(B) Tracts with populations of less than 2,000.--
A population census tract with a population of less
than 2,000 shall be treated as having a poverty rate
which meets the requirements of subparagraphs (A) and
(B) of subsection (a)(4) if more than 75 percent of
such tract is zoned for commercial or industrial use.
``(2) Discretion to adjust requirements.--Where necessary
to carry out the purposes of this subchapter, the appropriate
Secretary may reduce by 5 percentage points one of the
following thresholds for not more than 10 percent of the
population census tracts (or, if fewer, 5 population census
tracts) in the nominated area:
``(A) The 20 percent threshold in subsection
(a)(4)(A).
``(B) The 25 percent threshold in subsection
(a)(4)(B).
``(C) The 35 percent threshold in subsection
(a)(4)(C).
If the appropriate Secretary elects to reduce the threshold
under subparagraph (C) for an enterprise community, such
Secretary may (in lieu of applying the preceding sentence)
reduce by 10 percentage points the threshold under subparagraph
(C) for 3 population census tracts.
``(3) Each noncontiguous area must satisfy poverty rate
rule.--A nominated area may not include a noncontiguous parcel
unless such parcel separately meets (subject to paragraphs (1)
and (2)) the criteria set forth in subsection (a)(4).
``(4) Areas not within census tracts.--In the case of an
area which is not tracted for population census tracts, the
equivalent county divisions (as defined by the Bureau of the
Census for purposes of defining poverty areas) shall be used
for purposes of determining poverty rates.
``(c) Factors To Consider.--From among the nominated areas eligible
for designation under section 1391 by the appropriate Secretary, such
appropriate Secretary shall make designations of empowerment zones and
enterprise communities on the basis of--
``(1) the effectiveness of the strategic plan submitted
pursuant to section 1391(f)(2) and the assurances made pursuant
to section 1391(e)(3), and
``(2) criteria specified by the Enterprise Board.
``SEC. 1393. DEFINITIONS AND SPECIAL RULES.
``(a) In General.--For purposes of this subchapter--
``(1) Appropriate secretary.--The term `appropriate
Secretary' means--
``(A) the Secretary of Housing and Urban
Development in the case of any nominated area which is
located in an urban area,
``(B) the Secretary of Agriculture in the case of
any nominated area which is located in a rural area,
and
``(C) the Secretary of the Interior in the case of
any nominated area which is located in an Indian
reservation.
``(2) Enterprise board.--The term `Enterprise Board' means
any board hereafter established and designated for purposes of
this subchapter as the `Enterprise Board'.
``(3) Rural area.--The term `rural area' means any area
which is--
``(A) outside of a metropolitan statistical area
(within the meaning of section 143(k)(2)(B)), or
``(B) determined by the Secretary of Agriculture,
after consultation with the Secretary of Commerce, to
be a rural area.
``(4) Urban area.--The term `urban area' means an area
which is not a rural area.
``(5) Indian reservation.--
``(A) In general.--The term `Indian reservation'
means a reservation as defined in--
``(i) section 3(d) of the Indian Financing
Act of 1974 (25 U.S.C. 1452(d)), or
``(ii) section 4(10) of the Indian Child
Welfare Act of 1978 (25 U.S.C. 1903(10)).
``(B) Governments.--In the case of an area in an
Indian reservation, the reservation governing body (as
determined by the Secretary of the Interior) shall be
deemed to be both the State and local governments with
respect to such area.
``(6) Local government.--The term `local government'
means--
``(A) any county, city, town, township, parish,
village, or other general purpose political subdivision
of a State, and
``(B) any combination of political subdivisions
described in subparagraph (A) recognized by the
appropriate Secretary.
``(7) Nominated area.--The term `nominated area' means an
area which is nominated by 1 or more local governments and the
State or States in which it is located for designation under
section 1391.
``(8) Governments.--If more than 1 State or local
government seeks to nominate an area as a tax enterprise zone,
any reference to, or requirement of, this subchapter shall
apply to all such governments.
``(9) Special rule.--An area shall be treated as nominated
by a State and a local government if it is nominated by such
other entity as may be specified by the Enterprise Board.
``(10) Use of census data.--Population and poverty rate
shall be determined by the most recent decennial census data
available.
``(b) Empowerment Zone; Enterprise Community.--For purposes of this
title, the terms `empowerment zone' and `enterprise community' mean
areas designated as such under section 1391.
``PART II--INCENTIVES FOR EMPOWERMENT ZONES AND ENTERPRISE COMMUNITIES
``Sec. 1394. Incentives.
``SEC. 1394. INCENTIVES.
``(a) Increase in Low Income Housing Credit.--For purposes of
section 42(d)(5)(C), a building shall be treated as located in a
qualified census tract if--
``(1) such building is located in a census tract having a
poverty rate of at least 30 percent (determined in accordance
with section 1393(a)(10)), and
``(2) such building is located in an empowerment zone or an
enterprise community.
``(b) Tax Exempt Enterprise Zone Facility Bonds.--
``(1) In general.--For purposes of part IV of subchapter B
of chapter 1 (relating to tax exemption requirements for State
and local bonds), the term `exempt facility bond' includes any
bond issued as part of an issue 95 percent or more of the net
proceeds (as defined in section 150(a)(3)) of which are to be
used to provide any enterprise zone facility.
``(2) Enterprise zone facility.--For purposes of this
subsection--
``(A) In general.--The term `enterprise zone
facility' means any qualified zone property the
principal user of which is an enterprise zone business
(as defined in section 1397D), and any land which is
functionally related and subordinate to such property.
``(B) Qualified zone property.--The term `qualified
zone property' has the meaning given such term by
section 1397B(c); except that--
``(i) section 1397B(c)(3) shall not apply,
and
``(ii) the references to empowerment zones
shall be treated as including references to
enterprise communities.
``(3) Limitation on amount of bonds.--
``(A) In general.--Paragraph (1) shall not apply to
any issue if the aggregate amount of outstanding
enterprise zone facility bonds allocable to any
enterprise zone business (taking into account such
issue) exceeds--
``(i) $3,000,000 with respect to any 1
empowerment zone or enterprise community, or
``(ii) $20,000,000 with respect to all
empowerment zones and enterprise communities.
``(B) Aggregate enterprise zone facility bond
benefit.--For purposes of subparagraph (A), the
aggregate amount of outstanding enterprise zone
facility bonds allocable to any business shall be
determined under rules similar to the rules of section
144(a)(10), taking into account only bonds to which
paragraph (1) applies.
``(4) Acquisition of land and existing property
permitted.--The requirements of sections 147(c)(1)(A) and
147(d) shall not apply to any bond described in paragraph (1).
``(5) Partial exemption from volume cap.--Only for purposes
of section 146, the term `private activity bond' shall not
include 50 percent of any bond issued as part of an issue
described in paragraph (1).
``(6) Penalty for ceasing to meet requirements.--
``(A) Failures corrected.--An issue which fails to
meet 1 or more of the requirements of paragraphs (1)
and (2) shall be treated as meeting such requirements
if--
``(i) the issuer and any principal user in
good faith attempted to meet such requirements,
and
``(ii) any failure to meet such
requirements is corrected within a reasonable
period after such failure is first discovered.
``(B) Loss of deductions where facility ceases to
be qualified.--No deduction shall be allowed under this
chapter for interest on any financing provided from any
bond to which paragraph (1) applies with respect to any
facility to the extent such interest accrues during the
period beginning on the first day of the calendar year
which includes the date on which--
``(i) substantially all of the facility
with respect to which the financing was
provided ceases to be used in an empowerment
zone or enterprise community, or
``(ii) the principal user of such facility
ceases to be an enterprise zone business (as
defined in section 1397D, but treating
references to empowerment zones as including
references to enterprise communities).
``(C) Exception if zone ceases.--Subparagraphs (A)
and (B) shall not apply solely by reason of the
termination or revocation of a designation as an
empowerment zone or an enterprise community.
``(D) Exception for bankruptcy.--Subparagraphs (A)
and (B) shall not apply to any cessation resulting from
bankruptcy.
``(c) Enterprise Zone Facility Bonds Not Subject to Interest
Deduction Limitations on Financial Institutions.--Any tax-exempt bond
described in subsection (b)(1)--
``(1) shall be treated as acquired before August 8, 1986,
for purposes of sections 265(b) and 291(e)(1)(B), and
``(2) shall not be taken into account in determining
whether any issuer is a qualified small issuer for purposes of
section 265(b).
``(d) Additional Low-Income Housing Credit Amount.--
``(1) In general.--Each State which includes any
empowerment zone or enterprise community shall receive an
additional State housing credit ceiling amount for purposes of
section 42 of $818,000 for each such zone or community.
``(2) Additional amount must be allocated to buildings in
designated areas.--
``(A) In general.--The portion of the additional
amount received under paragraph (1) by reason of any
empowerment zone or enterprise community which may be
applied to increase the State housing credit ceiling
for any calendar year shall not exceed the lesser of--
``(i) the unused portion of such additional
amount with respect to such zone or community,
or
``(ii) the aggregate housing credit dollar
amount allocated from such ceiling for such
year to buildings located in such zone or
community.
``(B) Unused portion.--For purposes of subparagraph
(A), the unused portion for any calendar year of the
additional amount received under paragraph (1) is the
amount equal to the excess of--
``(i) the additional amount received under
paragraph (1) by the State by reason of the
zone or community, over
``(ii) the aggregate of the increases in
the State housing credit ceiling by reason of
such amount for all prior calendar years.
``(3) Availability of additional amount.--None of the
additional amount received under paragraph (1) may be applied
after 1996.
``(4) Areas located in more than 1 state.--In the case of
an empowerment zone or enterprise community which is located in
more than 1 State, the $818,000 amount shall be allocated among
such States in proportion to the population of such zone or
community which is within each such State.
``(5) Zones located in constitutional home rule cities.--If
any empowerment zone or enterprise community is located in a
constitutional home rule city (as defined in section
42(h)(4)(E)), the additional amount received under paragraph
(1) shall be allocated to such city and shall not be taken into
account in determining such city's share of the State housing
credit ceiling under section 42(h)(4)(E).
``PART III--ADDITIONAL INCENTIVES FOR EMPOWERMENT ZONES
``Subpart A. Empowerment zone employment
credit.
``Subpart B. Zone resident empowerment
savings credit.
``Subpart C. Depreciation and other
incentives.
``Subpart A--Empowerment Zone Employment Credit
``Sec. 1396. Empowerment zone employment
credit.
``Sec. 1397. Other definitions and
special rules.
``SEC. 1396. EMPOWERMENT ZONE EMPLOYMENT CREDIT.
``(a) Amount of Credit.--For purposes of section 38, the amount of
the empowerment zone employment credit determined under this section
with respect to any employer for any taxable year is the applicable
percentage of the qualified zone wages paid or incurred during the
calendar year which ends with or within such taxable year.
``(b) Applicable Percentage.--For purposes of this section, the
term `applicable percentage' means the percentage determined in
accordance with the following table:
``In the case of wages paid or
The applicable
incurred during calendar year:
percentage is:
1994 through 2000.......... 25
2001....................... 20
2002....................... 15
2003....................... 10
2004....................... 5
``(c) Qualified Zone Wages.--
``(1) In general.--For purposes of this section, the term
`qualified zone wages' means any wages paid or incurred by an
employer for services performed by an employee while such
employee is a qualified zone employee.
``(2) Only first $20,000 of wages per year taken into
account.--With respect to each qualified zone employee, the
amount of qualified zone wages which may be taken into account
for a calendar year shall not exceed $20,000.
``(3) Coordination with targeted jobs credit.--
``(A) In general.--The term `qualified zone wages'
shall not include wages taken into account in
determining the credit under section 51.
``(B) Coordination with paragraph (2).--The $20,000
amount in paragraph (2) shall be reduced for any
calendar year by the amount of wages paid or incurred
during such year which are taken into account in
determining the credit under section 51.
``(d) Qualified Zone Employee.--For purposes of this section--
``(1) In general.--Except as otherwise provided in this
subsection, the term `qualified zone employee' means, with
respect to any period, any employee of an employer if--
``(A) substantially all of the services performed
during such period by such employee for such employer
are performed within an empowerment zone in a trade or
business of the employer, and
``(B) the principal place of abode of such employee
while performing such services is within such
empowerment zone.
``(2) Certain individuals not eligible.--The term
`qualified zone employee' shall not include--
``(A) any individual described in subparagraph (A),
(B), or (C) of section 51(i)(1),
``(B) any 5-percent owner (as defined in section
416(i)(1)(B)),
``(C) any individual employed by the employer for
less than 90 days,
``(D) any individual employed by the employer at
any facility described in section 144(c)(6)(B), and
``(E) any individual employed by the employer in a
trade or business the principal activity of which is
farming (within the meaning of subparagraphs (A) or (B)
of section 2032A(e)(5)), but only if, as of the close
of the taxable year, the sum of--
``(i) the aggregate unadjusted bases (or,
if greater, the fair market value) of the
assets owned by the employer which are used in
such a trade or business, and
``(ii) the aggregate value of assets leased
by the employer which are used in such a trade
or business (as determined under regulations
prescribed by the Secretary),
exceeds $500,000.
``(3) Special rules related to termination of employment.--
``(A) In general.--Paragraph (2)(C) shall not apply
to--
``(i) a termination of employment of an
individual who before the close of the period
referred to in paragraph (2)(C) becomes
disabled to perform the services of such
employment unless such disability is removed
before the close of such period and the
taxpayer fails to offer reemployment to such
individual, or
``(ii) a termination of employment of an
individual if it is determined under the
applicable State unemployment compensation law
that the termination was due to the misconduct
of such individual.
``(B) Changes in form of business.--For purposes of
paragraph (2)(C), the employment relationship between
the taxpayer and an employee shall not be treated as
terminated--
``(i) by a transaction to which section
381(a) applies if the employee continues to be
employed by the acquiring corporation, or
``(ii) by reason of a mere change in the
form of conducting the trade or business of the
taxpayer if the employee continues to be
employed in such trade or business and the
taxpayer retains a substantial interest in such
trade or business.
``SEC. 1397. OTHER DEFINITIONS AND SPECIAL RULES.
``(a) Wages.--For purposes of this subpart--
``(1) In general.--The term `wages' has the same meaning as
when used in section 51.
``(2) Certain training and educational benefits.--
``(A) In general.--The following amounts shall be
treated as wages paid to an employee:
``(i) Any amount paid or incurred by an
employer which is excludable from the gross
income of an employee under section 127, but
only to the extent paid or incurred to a person
not related to the employer.
``(ii) In the case of an employee who has
not attained the age of 19, any amount paid or
incurred by an employer for any youth training
program operated by such employer in
conjunction with local education officials.
``(B) Related person.--A person is related to any
other person if the person bears a relationship to such
other person specified in section 267(b) or 707(b)(1),
or such person and such other person are engaged in
trades or businesses under common control (within the
meaning of subsections (a) and (b) of section 52). For
purposes of the preceding sentence, in applying section
267(b) or 707(b)(1), `10 percent' shall be substituted
for `50 percent'.
``(b) Controlled Groups.--For purposes of this subpart--
``(1) all employers treated as a single employer under
subsection (a) or (b) of section 52 shall be treated as a
single employer for purposes of this subpart, and
``(2) the credit (if any) determined under section 1396
with respect to each such employer shall be its proportionate
share of the wages giving rise to such credit.
``(c) Certain Other Rules Made Applicable.--For purposes of this
subpart, rules similar to the rules of section 51(k) and subsections
(c), (d), and (e) of section 52 shall apply.
``(d) Notice of Availability of Advance Payment of Earned Income
Credit.--Each employer shall take reasonable steps to notify all
qualified zone employees of the availability to eligible individuals of
receiving advanced payments of the credit under section 32 (relating to
the earned income credit).
``Subpart B--Zone Resident Empowerment Savings Credit
``Sec. 1397A. Zone resident empowerment
savings credit.
``SEC. 1397A. ZONE RESIDENT EMPOWERMENT SAVINGS CREDIT.
``(a) General Rule.--For purposes of section 38, the amount of the
zone resident empowerment savings credit determined under this section
with respect to any employer for any taxable year is 50 percent of the
qualified savings contributions for the taxable year.
``(b) Qualified Savings Contributions.--For purposes of this
section--
``(1) In general.--The term `qualified savings
contribution' means any contribution by an employer to a
defined contribution plan--
``(A) which is made on behalf of an employee in
connection with services performed by such employee
while such employee is a qualified zone employee, and
``(B) with respect to which the employee has a
nonforfeitable right.
``(2) Limitation based on compensation.--
``(A) In general.--The qualified savings
contributions taken into account with respect to any
qualified zone employee for any taxable year shall not
exceed an amount equal to 2 percent of so much of the
employee's compensation (as defined in section 414(s))
as does not exceed $35,000.
``(B) Zone designation in effect for partial
year.--If a designation of an area as an empowerment
zone is in effect for less than the entire taxable
year, the $35,000 amount under subparagraph (A) shall
be ratably reduced to reflect the portion of the year
such designation is not in effect.
``(3) Certain contributions excluded.--The term `qualified
savings contribution' shall not include any contribution--
``(A) to a plan subject to the funding requirements
of section 412,
``(B) to a tax credit employee stock ownership plan
(as defined in section 409(a)) or to an employee stock
ownership plan (as defined in section 4975(e)(7)),
``(C) to a stock bonus plan, or
``(D) which is an elective deferral (within the
meaning of section 402(g)(3)).
``(4) Simplified employee pension.--A contribution to an
individual savings plan pursuant to a simplified employee
pension (as defined in section 408(k)) shall be treated as a
contribution to a defined contribution plan.
``(c) Employer Requirements.--This section shall apply to an
employer for any taxable year only if--
``(1) the employer elects the application of this section,
and
``(2) the plan pursuant to which any qualified savings
contribution is made provides that any contribution to such
plan (whether or not a qualified savings contribution) may be
withdrawn by a qualified zone employee as described in section
72(t)(2) (B) or (D).
``(d) Definitions.--For purposes of this section--
``(1) Qualified zone employee.--The term `qualified zone
employee' has the meaning given such term by section 1396(d).
``(2) Defined contribution plan.--The term `defined
contribution plan' means a defined contribution plan (as
defined in section 414(i)) which is described in section 401(a)
and includes a trust exempt from tax under section 501(a).
``(e) Treatment of Plans.--A plan shall not be treated as failing
to meet any requirement of part I of subchapter D of chapter 1 by
reason of permitting withdrawals required to be permitted under
subsection (c)(2).
``Subpart C--Depreciation and Other Incentives
``Sec. 1397B. Depreciation benefits.
``Sec. 1397C. Additional exclusion from
volume cap for certain
enterprise zone facility bonds.
``Sec. 1397D. Enterprise zone business.
``SEC. 1397B. DEPRECIATION BENEFITS.
``(a) Increase in Expensing Under Section 179.--
``(1) In general.--In the case of an enterprise zone
business, for purposes of section 179--
``(A) qualified zone property shall be treated as
section 179 property,
``(B) the limitation under section 179(b)(1) shall
be increased by the lesser of--
``(i) $50,000, or
``(ii) the cost of qualified zone property
placed in service during the taxable year, and
``(C) section 179(b)(2) shall be applied by
substituting `by one-half of the amount by which the
cost of qualified zone property (other than real
property) and other section 179 property' for `by the
amount by which the cost of section 179 property'.
``(b) Accelerated Depreciation.--
``(1) In general.--For purposes of section 168(a), with
respect to qualified zone property of an enterprise zone
business, the applicable recovery period shall be determined in
accordance with the table contained in paragraph (2) in lieu of
the table contained in section 168(c).
``(2) Applicable recovery period for qualified zone
property.--For purposes of paragraph (1)--
The applicable
``In the case of: recovery period is:
3-year property............................... 2 years
5-year property............................... 3 years
7-year property............................... 4 years
10-year property.............................. 6 years
15-year property.............................. 9 years
20-year property.............................. 12 years
Nonresidential real property.................. 22 years.
``(3) Deduction allowed in computing minimum tax.--
Paragraph (1) shall apply for purposes of determining
alternative minimum taxable income under section 55.
``(c) Qualified Zone Property.--For purposes of this section--
``(1) In general.--The term `qualified zone property' means
any property to which section 168 applies (or would apply but
for section 179) if--
``(A) such property was acquired by the taxpayer by
purchase (as defined in section 179(d)(2)) after the
date on which the designation of the empowerment zone
took effect,
``(B) the original use of which in an empowerment
zone commences with the taxpayer, and
``(C) substantially all of the use of which is in
an empowerment zone and is in the active conduct of a
trade or business by the taxpayer in such zone.
``(2) Special rule for substantial renovations.--In the
case of any property which is substantially renovated by the
taxpayer, the requirements of subparagraphs (A) and (B) of
paragraph (1) shall be treated as satisfied. For purposes of
the preceding sentence, property shall be treated as
substantially renovated by the taxpayer if, during any 24-month
period beginning after the date on which the designation of the
empowerment zone took effect, additions to basis with respect
to such property in the hands of the taxpayer exceed the
greater of (i) an amount equal to the adjusted basis at the
beginning of such 24-month period in the hands of the taxpayer,
or (ii) $5,000.
``(3) Exception for alternative depreciation property.--The
term `qualified zone property' does not include any property to
which the alternative depreciation system under section 168(g)
applies, determined--
``(A) without regard to section 168(g)(7) (relating
to election to use alternative depreciation system),
and
``(B) after the application of section 280F(b)
(relating to listed property with limited business
use).
``(d) Special Rules for Sale-Leasebacks.--For purposes of
subsection (c)(1)(B), if property is sold and leased back by the
taxpayer within 3 months after the date such property was originally
placed in service, such property shall be treated as originally placed
in service not earlier than the date on which such property is used
under the leaseback.
``(e) Recapture.--Rules similar to the rules under section
179(d)(10) shall apply with respect to any qualified zone property of
any business which ceases to be an enterprise zone business.
``SEC. 1397C. ADDITIONAL EXCLUSION FROM VOLUME CAP FOR CERTAIN
ENTERPRISE ZONE FACILITY BONDS.
``(a) In General.--Section 1394(b)(5) shall be applied by
substituting `75 percent' for `50 percent' in the case of any bond
described in section 1394(b)(1) issued as part of an issue 95 percent
or more of the net proceeds (as defined in section 150(a)(3)) of which
are used to provide qualified zone property the principal user of which
is any enterprise zone business if the ownership requirements of
subsection (b) are met with respect to such business.
``(b) Ownership Requirements.--The ownership requirements of this
subsection are met with respect to an enterprise zone business if--
``(1) in the case of a sole proprietorship, the principal
place of abode of the proprietor is in an empowerment zone,
``(2) in the case of a corporation, more than 50 percent of
the stock (by vote and value) in the corporation is owned
(directly or indirectly) by individuals whose principal place
of abode is in an empowerment zone, and
``(3) in the case of a partnership, more than 50 percent of
the capital and profits interests in the partnership is owned
(directly or indirectly) by individuals whose principal place
of abode is in an empowerment zone.
``SEC. 1397D. ENTERPRISE ZONE BUSINESS DEFINED.
``(a) In General.--For purposes of this subpart, the term
`enterprise zone business' means--
``(1) any qualified business entity, and
``(2) any qualified proprietorship.
``(b) Qualified Business Entity.--For purposes of this section, the
term `qualified business entity' means, with respect to any taxable
year, any corporation or partnership if for such year--
``(1) every trade or business of such entity is the active
conduct of a qualified business within an empowerment zone,
``(2) at least 80 percent of the total gross income of such
entity is derived from the active conduct of such business,
``(3) substantially all of the use of the tangible property
of such entity (whether owned or leased) is within an
empowerment zone,
``(4) substantially all of the intangible property of such
entity is used in, and exclusively related to, the active
conduct of any such business,
``(5) substantially all of the services performed for such
entity by its employees are performed in an empowerment zone,
``(6) at least 35 percent of its employees are residents of
an empowerment zone,
``(7) less than 5 percent of the average of the aggregate
unadjusted bases of the property of such entity is attributable
to collectibles (as defined in section 408(m)(2)) other than
collectibles that are held primarily for sale to customers in
the ordinary course of such business, and
``(8) less than 5 percent of the average of the aggregate
unadjusted bases of the property of such entity is attributable
to nonqualified financial property.
``(c) Qualified Proprietorship.--For purposes of this section, the
term `qualified proprietorship' means, with respect to any taxable
year, any qualified business carried on by an individual as a
proprietorship if for such year--
``(1) at least 80 percent of the total gross income of such
individual from such business is derived from the active
conduct of such business in an empowerment zone,
``(2) substantially all of the use of the tangible property
of such individual in such business (whether owned or leased)
is within an empowerment zone,
``(3) substantially all of the intangible property of such
business is used in, and exclusively related to, the active
conduct of such business,
``(4) substantially all of the services performed for such
individual in such business by employees of such business are
performed in an empowerment zone,
``(5) at least 35 percent of such employees are residents
of an empowerment zone,
``(6) less than 5 percent of the average of the aggregate
unadjusted bases of the property of such individual which is
used in such business is attributable to collectibles (as
defined in section 408(m)(2)) other than collectibles that are
held primarily for sale to customers in the ordinary course of
such business, and
``(7) less than 5 percent of the average of the aggregate
unadjusted bases of the property of such individual which is
used in such business is attributable to nonqualified financial
property.
For purposes of this subsection, the term `employee' includes the
proprietor.
``(d) Qualified Business.--For purposes of this section--
``(1) In general.--Except as otherwise provided in this
subsection, the term `qualified business' means any trade or
business.
``(2) Rental of real property.--The rental to others of
real property located in an empowerment zone shall be treated
as a qualified business if and only if--
``(A) the property is not residential rental
property (as defined in section 168(e)(2)), and
``(B) at least 50 percent of the gross rental
income from the real property is from enterprise zone
businesses.
``(3) Rental of tangible personal property.--The rental to
others of tangible personal property shall be treated as a
qualified business if and only if substantially all of the
rental of such property is by enterprise zone businesses or by
residents of an empowerment zone.
``(4) Treatment of business holding intangibles.--The term
`qualified business' shall not include any trade or business
consisting predominantly of the development or holding of
intangibles for sale or license.
``(5) Certain businesses excluded.--The term `qualified
business' shall not include--
``(A) any trade or business consisting of the
operation of any facility described in section
144(c)(6)(B), and
``(B) any trade or business the principal activity
of which is farming (within the meaning of
subparagraphs (A) or (B) of section 2032A(e)(5)), but
only if, as of the close of the preceding taxable year,
the sum of--
``(i) the aggregate unadjusted bases (or,
if greater, the fair market value) of the
assets owned by the taxpayer which are used in
such a trade or business, and
``(ii) the aggregate value of assets leased
by the taxpayer which are used in such a trade
or business,
exceeds $500,000.
For purposes of subparagraph (B), rules similar to the rules of
section 1397(b) shall apply.
``(e) Nonqualified Financial Property.--For purposes of this
section, the term `nonqualified financial property' means debt, stock,
partnership interests, options, futures contracts, forward contracts,
warrants, notional principal contracts, annuities, and other similar
property specified in regulations; except that such term shall not
include--
``(1) reasonable amounts of working capital held in cash,
cash equivalents, or debt instruments with a term of 18 months
or less, or
``(2) debt instruments described in section 1221(4).
``PART IV--REGULATIONS
``Sec. 1397E. Regulations.
``SEC. 1397E. REGULATIONS.
``The Secretary shall prescribe such regulations as may be
necessary or appropriate to carry out the purposes of parts II and III,
including--
``(1) regulations limiting the benefit of parts II and III
in circumstances where such benefits, in combination with
benefits provided under other Federal programs, would result in
an activity being 100 percent or more subsidized by the Federal
Government,
``(2) regulations preventing abuse of the provisions of
parts II and III, and
``(3) regulations dealing with inadvertent failures of
entities to be enterprise zone businesses.''
(b) Clerical Amendment.--The table of subchapters for chapter 1 is
amended by inserting after the item relating to subchapter T the
following new item:
``Subchapter U. Designation and treatment
of empowerment zones and
enterprise communities.''
SEC. 14302. EXPANSION OF TARGETED JOBS CREDIT.
(a) Allowance of Credit for Hiring Empowerment Zone Resident.--
Paragraph (1) of section 51(d) (defining members of targeted groups) is
amended by striking ``or'' at the end of subparagraph (I), by striking
the period at the end of subparagraph (J) and inserting ``, or'', and
by adding at the end the following new subparagraph:
``(K) an economically disadvantaged empowerment zone
resident.''
(b) Economically Disadvantaged Empower- ment Zone Resident.--
Section 51(d) is amended by redesignating paragraphs (13) through (16)
as paragraphs (14) through (17), respectively, and by inserting after
paragraph (12) the following new paragraph:
``(13) Economically disadvantaged empowerment zone
resident.--The term `economically disadvantaged empowerment
zone resident' means an individual--
``(A) whose principal place of abode while
performing services for the employer is within an
empowerment zone, and
``(B) who is certified by the designated local
agency as being a member of an economically
disadvantaged family (as determined under paragraph
(11)).
Such term shall not include a qualified zone employee (as
defined in section 1396(d) without regard to paragraph (2)
thereof).''
(c) Conforming Amendment.--Subparagraph (C) of section 51(d)(12) is
amended by striking ``paragraph (14)'' and inserting ``paragraph
(15)''.
SEC. 14303. TECHNICAL AND CONFORMING AMENDMENTS.
(a) Certain Credits Part of General Business Credit.--
(1) Subsection (b) of section 38 (relating to current year
business credit) is amended by striking ``plus'' at the end of
paragraph (7), by striking the period at the end of paragraph
(8) and inserting a comma, and by adding at the end the
following new paragraphs:
``(9) the empowerment zone employment credit determined
under section 1396(a), plus
``(10) the zone resident empowerment savings credit
determined under section 1397A.''
(2) Subsection (d) of section 39 is amended by adding at
the end the following new paragraph:
``(4) Enterprise zone credits.--No portion of the unused
business credit which is attributable to the credit determined
under section 1396 (relating to empowerment zone employment
credit) or section 1397A (relating to zone resident empowerment
savings credit) may be carried to any taxable year ending
before January 1, 1994.''
(b) Denial of Deduction for Portion of Wages Equal to Empowerment
Zone Employment Credit.--
(1) Subsection (a) of section 280C (relating to rule for
targeted jobs credit) is amended--
(A) by striking ``the amount of the credit
determined for the taxable year under section 51(a)''
and inserting ``the sum of the credits determined for
the taxable year under sections 51(a) and 1396(a)'',
and
(B) by striking ``Targeted Jobs Credit'' in the
subsection heading and inserting ``Employment
Credits''.
(2) Subsection (c) of section 196 (relating to deduction
for certain unused business credits) is amended by striking
``and'' at the end of paragraph (4), by striking the period at
the end of paragraph (5) and inserting ``, and'', and by adding
at the end the following new paragraph:
``(6) the empowerment zone employment credit determined
under section 1396(a).''
(c) Employment and Savings Credits May Offset 25 Percent of Minimum
Tax.--
(1) In general.--Section 38(c) (relating to limitation
based on amount of tax) is amended by redesignating paragraph
(2) as paragraph (3) and by inserting after paragraph (1) the
following new paragraph:
``(2) Empowerment zone credits may offset 25 percent of
minimum tax.--
``(A) In general.--In the case of the empowerment
zone credits--
``(i) this section and section 39 shall be
applied separately with respect to such
credits, and
``(ii) for purposes of applying paragraph
(1) to such credits--
``(I) 75 percent of the tentative
minimum tax shall be substituted for
the tentative minimum tax under
subparagraph (A) thereof, and
``(II) the limitation under
paragraph (1) (as modified by subclause
(I)) shall be reduced by the credit
allowed under subsection (a) for the
taxable year (other than the
empowerment zone credits).
``(B) Empowerment zone credits.--For purposes of
this paragraph, the term `empowerment zone credits'
means the portion of the credit under subsection (a)
which is attributable to the credits determined under
section 1396 (relating to empowerment zone employment
credit) and section 1397A (relating to zone resident
empowerment savings credit).''
(d) Changes Relating to Empowerment Zone Resident Empowerment
Savings Credit.--
(1) Disallowance of deduction.--Section 404 (relating to
deduction for certain employer contributions) is amended by
adding at the end the following new subsection:
``(m) Coordination With Empowerment Zone Credit.--No deduction
shall be allowed under this section for any qualified employer
contribution taken into account in computing the credit determined
under section 1397A.''
(2) Penalty-free distributions.--
(A) In general.--Paragraph (2) of section 72(t)
(relating to exceptions to 10-percent additional tax on
early distributions from qualified retirement plans) is
amended by adding at the end thereof the following new
subparagraph:
``(D) Distributions from certain plans for first
home purchases or educational expenses.--
``(i) In general.--Distributions to an
individual from a qualified retirement plan--
``(I) which are qualified first-
time homebuyer distributions (as
defined in paragraph (6)),
``(II) to the extent such
distributions do not exceed the
qualified higher education expenses (as
defined in paragraph (7)) of the
taxpayer for the taxable year, or
``(III) to the extent such
distributions do not exceed an amount
equal to the aggregate investment made
by the taxpayer during the taxable year
in any enterprise zone business (as
defined in section 1397D) that meets
the ownership requirements of section
1397C(b).
``(ii) Limitation.--Clause (i) shall not
apply to the extent that the aggregate amount
of the distributions described in clause (i) is
greater than the excess of--
``(I) the qualified savings
contributions (as defined in section
1397A(b)) of the taxpayer, and any
earnings thereon, over
``(II) the aggregate amounts to
which clause (i) and the last sentence
of paragraph (3)(A) applied for
preceding taxable years.''
(B) Definitions.--Section 72(t) is amended by
adding at the end thereof the following new paragraphs:
``(6) Qualified first-time homebuyer distributions.--For
purposes of paragraph (2)(D)(i)(I)--
``(A) In general.--The term `qualified first-time
homebuyer distribution' means any payment or
distribution received by an individual to the extent
such payment or distribution is used by the individual
before the close of the 60th day after the day on which
such payment or distribution is received to pay
qualified acquisition costs with respect to a principal
residence of a first-time homebuyer who is such
individual or the spouse of such individual.
``(B) Qualified acquisition costs.--For purposes of
this paragraph, the term `qualified acquisition costs'
means the costs of acquiring, constructing, or
reconstructing a residence. Such term includes any
usual or reasonable settlement, financing, or other
closing costs.
``(C) First-time homebuyer; other definitions.--For
purposes of this paragraph--
``(i) First-time homebuyer.--The term
`first-time homebuyer' means any individual
if--
``(I) such individual (and if
married, such individual's spouse) had
no present ownership interest in a
principal residence during the 3-year
period ending on the date of
acquisition of the principal residence
to which this paragraph applies, and
``(II) subsection (a)(6), (h), or
(k) of section 1034 did not suspend the
running of any period of time specified
in section 1034 with respect to such
individual on the day before the date
the distribution is applied pursuant to
subparagraph (A)(ii).
``(ii) Principal residence.--The term
`principal residence' has the same meaning as
when used in section 1034.
``(iii) Date of acquisition.--The term
`date of acquisition' means the date--
``(I) on which a binding contract
to acquire the principal residence to
which subparagraph (A) applies is
entered into, or
``(II) on which construction or
reconstruction of such a principal
residence is commenced.
``(D) Special rule where delay in acquisition.--If
any distribution from any qualified retirement plan
fails to meet the requirements of subparagraph (A)
solely by reason of a delay or cancellation of the
purchase or construction of the residence, the amount
of the distribution may be recontributed to the plan
from which it was distributed within 120 days after the
date of such distribution.
``(7) Qualified higher education expenses.--For purposes of
paragraph (2)(D)(ii)(II)--
``(A) In general.--The term `qualified higher
education expenses' means tuition, fees, books,
supplies, and equipment required for the enrollment or
attendance of--
``(i) the taxpayer,
``(ii) the taxpayer's spouse, or
``(iii) the taxpayer's child (as defined in
section 151(c)(3)) or grandchild,
at an eligible educational institution (as defined in
section 135(c)(3)).
``(B) Coordination with savings bond provisions.--
The amount of qualified higher education expenses for
any taxable year shall be reduced by any amount
excludable from gross income under section 135.''
(C) Conforming amendments.--
(i) Subparagraph (B) of section 72(t)(2) is
amended by striking ``or (C)'' and inserting
``, (C), or (D)''.
(ii) Section 401(k)(2)(B)(i) is amended by
striking ``or'' at the end of subclause (III),
by striking ``and'' at the end of subclause
(IV) and inserting ``or'', and by inserting
after subclause (IV) the following new
subclause:
``(V) subject to the limitation of
section 72(t)(2)(D)(ii), the date on
which qualified first-time homebuyer
distributions (as defined in section
72(t)(6)), distributions for qualified
higher education expenses (as defined
in section 72(t)(7)), or distributions
for investments described in section
72(t)(2)(D)(i)(III) are made, and''.
(e) Amendment of Targeted Jobs Credit.--Subparagraph (A) of section
51(i)(1) is amended by inserting ``, or, if the taxpayer is an entity
other than a corporation, to any individual who owns, directly or
indirectly, more than 50 percent of the capital and profits interests
in the entity,'' after ``of the corporation''.
(f) Carryovers.--Subsection (c) of section 381 (relating to
carryovers in certain corporate acquisitions) is amended by adding at
the end the following new paragraph:
``(26) Enterprise zone provisions.--The acquiring
corporation shall take into account (to the extent proper to
carry out the purposes of this section and subchapter U, and
under such regulations as may be prescribed by the Secretary)
the items required to be taken into account for purposes of
subchapter U in respect of the distributor or transferor
corporation.''
SEC. 14304. EFFECTIVE DATE.
The amendments made by this part shall take effect on the date of
the enactment of this Act.
PART II--CREDIT FOR CONTRIBUTIONS TO CERTAIN COMMUNITY DEVELOPMENT
CORPORATIONS
SEC. 14311. CREDIT FOR CONTRIBUTIONS TO CERTAIN COMMUNITY DEVELOPMENT
CORPORATIONS.
(a) In General.--For purposes of section 38 of the Internal Revenue
Code of 1986, the current year business credit shall include the credit
determined under this section.
(b) Determination of Credit.--The credit determined under this
section for each taxable year in the credit period with respect to any
qualified CDC contribution made by the taxpayer is an amount equal to 5
percent of such contribution.
(c) Credit Period.--For purposes of this section, the credit period
with respect to any qualified CDC contribution is the period of 10
taxable years beginning with the taxable year during which such
contribution was made.
(d) Qualified CDC Contribution.--For purposes of this section--
(1) In general.--The term ``qualified CDC contribution''
means any transfer of cash--
(A) which is made to a selected community
development corporation during the 5-year period
beginning on the date such corporation was selected for
purposes of this section,
(B) the amount of which is available for use by
such corporation for at least 10 years,
(C) which is to be used by such corporation for
qualified low-income assistance within its operational
area, and
(D) which is designated by such corporation for
purposes of this section.
(2) Limitations on amount designated.--The aggregate amount
of contributions to a selected community development
corporation which may be designated by such corporation shall
not exceed $4,000,000.
(e) Selected Community Development Corporations.--
(1) In general.--For purposes of this section, the term
``selected community development corporation'' means any
corporation--
(A) which is described in section 501(c)(3) of such
Code and exempt from tax under section 501(a) of such
Code,
(B) the principal purposes of which include
promoting employment of, and business opportunities
for, low-income individuals who are residents of the
operational area, and
(C) which is selected by the Secretary of Housing
and Urban Development for purposes of this section.
(2) Only 10 corporations may be selected.--
(A) In general.--The Secretary of Housing and Urban
Development may select 10 corporations for purposes of
this section, subject to the availability of eligible
corporations. Such selections may be made only before
July 1, 1994. At least 4 of the operational areas of
the corporations selected must be rural areas (as
defined by section 1393(a)(3) of such Code).
(B) Priority of designations.--In selecting
corporations for purposes of this section, such
Secretary shall give priority to corporations with a
demonstrated record of performance in administering
community development programs which target at least 75
percent of the jobs emanating from their investment
funds to low income or unemployed individuals.
(3) Operational areas must have certain characteristics.--A
corporation may be selected for purposes of this section only
if its operational area meets the following criteria:
(A) The area meets the size requirements under
section 1392(a)(3).
(B) The unemployment rate (as determined by the
appropriate available data) is not less than the
national unemployment rate.
(C) The median family income of residents of such
area does not exceed 80 percent of the median gross
income of residents of the jurisdiction of the local
government which includes such area.
(f) Qualified Low-Income Assistance.--For purposes of this section,
the term ``qualified low-income assistance'' means assistance--
(1) which is designed to provide employment of, and
business opportunities for, low-income individuals who are
residents of the operational area of the community development
corporation, and
(2) which is approved by the Secretary of Housing and Urban
Development.
Subtitle D--Other Provisions
PART I--DISCLOSURE PROVISIONS
SEC. 14401. DISCLOSURE OF RETURN INFORMATION FOR ADMINISTRATION OF
CERTAIN VETERANS PROGRAMS.
(a) General Rule.--Subparagraph (D) of section 6103(l)(7) (relating
to disclosure of return information to Federal, State, and local
agencies administering certain programs) is amended by striking
``September 30, 1997'' in the second sentence following clause (viii)
and inserting ``September 30, 1998''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect on the date of the enactment of this Act.
SEC. 14402. DISCLOSURE OF RETURN INFORMATION TO CARRY OUT INCOME
CONTINGENT REPAYMENT OF STUDENT LOANS.
(a) General Rule.--Subsection (l) of section 6103 (relating to
confidentiality and disclosure of returns and return information) is
amended by adding at the end thereof the following new paragraph:
``(13) Disclosure of return information to carry out income
contingent repayment of student loans.--
``(A) In general.--The Secretary may, upon written
request from the Secretary of Education, disclose to
officers and employees of the Department of Education
return information with respect to a taxpayer who has
received an applicable student loan and whose loan
repayment amounts are based in whole or in part on the
taxpayer's income. Such return information shall be
limited to--
``(i) taxpayer identity information with
respect to such taxpayer,
``(ii) the filing status of such taxpayer,
and
``(iii) the adjusted gross income of such
taxpayer.
``(B) Restriction on use of disclosed
information.--Return information disclosed under
subparagraph (A) may be used by officers and employees
of the Department of Education only for the purposes
of, and to the extent necessary in, establishing the
appropriate income contingent repayment amount for an
applicable student loan.
``(C) Applicable student loan.--For purposes of
this paragraph, the term `applicable student loan'
means--
``(i) any loan made under the program
authorized under part D of title IV of the
Higher Education Act of 1965, and
``(ii) any loan made under part B or E of
title IV of the Higher Education Act of 1965
which is in default and has been assigned to
the Department of Education.
``(D) Termination.--This paragraph shall not apply
to any request made after September 30, 1998.''
(b) Conforming Amendments.--
(1) So much of paragraph (4) of section 6103(m) as precedes
subparagraph (B) thereof is amended to read as follows:
``(4) Individuals who owe an overpayment of federal pell
grants or who have defaulted on student loans administered by
the department of education.--
``(A) In general.--Upon written request by the
Secretary of Education, the Secretary may disclose the
mailing address of any taxpayer--
``(i) who owes an overpayment of a grant
awarded to such taxpayer under subpart 1 of
part A of title IV of the Higher Education Act
of 1965, or
``(ii) who has defaulted on a loan--
``(I) made under part B, D, or E of
title IV of the Higher Education Act of
1965, or
``(II) made pursuant to section
3(a)(1) of the Migration and Refugee
Assistance Act of 1962 to a student at
an institution of higher education,
for use only by officers, employees, or agents of the
Department of Education for purposes of locating such
taxpayer for purposes of collecting such overpayment or
loan .''
(2) Subparagraph (B) of section 6103(m)(4) is amended--
(A) in clause (i), by striking ``under part B'' and
inserting ``under part B or D''; and
(B) in clause (ii), by striking ``under part E''
and inserting ``under subpart 1 of part A, or part D or
E,'';
(3) Section 6103(p) is amended--
(A) in paragraph (3)(A), by striking ``(11), or
(12), (m)'' and inserting ``(11), (12), or (13), (m)'';
(B) in paragraph (4)--
(i) in the matter preceding subparagraph
(A), by striking out ``(10), or (11),'' and
inserting ``(10), (11), or (13),'', and
(ii) in subparagraph (F)(ii), by striking
``(11), or (12),'' and inserting ``(11), (12),
or (13),''.
(c) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act.
(d) Study of Internal Revenue Service Collection of Student
Loans.--
(1) General rule.--The Secretary of the Treasury, in
consultation with the Secretary of Education, shall conduct a
study of the feasibility of implementing a system for the
repayment of Federal student loans through wage withholding or
other means involving the Internal Revenue Service. Such study
shall include an examination of--
(A) whether the Internal Revenue Service could
implement such a system within its current resources
and without adversely affecting the ability of the
Internal Revenue Service to collect tax revenues,
(B) the cumulative impact on voluntary compliance
with the tax system of increased disclosure of tax
return information and increased Internal Revenue
Service involvement in nontax collection activities,
(C) the anticipated effect on the management of
Federal student loan collections and on borrower
repayment of such loans, and
(D) the ability of the Internal Revenue Service to
effectively service student loans.
(2) Recommendations.--Not later than the date 6 months
after the date of the enactment of this Act, the Secretary of
the Treasury shall submit to the Congress a report on the study
conducted under paragraph (1) (together with such legislative
recommendations as such Secretary may deem advisable).
SEC. 14403. USE OF RETURN INFORMATION FOR INCOME VERIFICATION UNDER
CERTAIN HOUSING ASSISTANCE PROGRAMS.
(a) In General.--Subparagraph (D) of section 6103(l)(7) (relating
to the disclosure of return information to Federal, State, and local
agencies administering certain programs) is amended--
(1) in clause (vii), by striking ``and'' at the end;
(2) in clause (viii), by striking the period at the end and
inserting ``; and'';
(3) by inserting after clause (viii) the following new
clause:
``(ix) any housing assistance program administered by the
Department of Housing and Urban Development that involves
initial and periodic review of an applicant's or participant's
income, except that return information may be disclosed under
this clause only on written request by the Secretary of Housing
and Urban Development and only for use by officers and
employees of the Department of Housing and Urban Development
with respect to applicants for and participants in such
programs.''; and
(4) by adding at the end thereof the following: ``Clause
(ix) shall not apply after September 30, 1998.''
(b) Conforming Amendment.--The heading of paragraph (7) of section
6103(l) is amended by inserting after ``code'' the following: ``, or
certain housing assistance programs''.
(c) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act.
(d) Study.--The Secretary of the Treasury or his delegate, in
consultation with the Secretary of Housing and Urban Development, shall
conduct a study on--
(1) whether the information provided under section
6103(l)(7)(D)(ix) of the Internal Revenue Code of 1986 is being
used effectively by the Department of Housing and Urban
Development,
(2) such Department's compliance with the requirements of
section 6103(p) of such Code, and
(3) the impact on the privacy rights of applicants for and
participants in housing assistance programs administered by the
Department of Housing and Urban Development.
The report of such study shall be submitted before January 1, 1998, to
the Congress.
PART II--USER FEE PROVISIONS
SEC. 14411. FEES FOR APPLICATIONS FOR ALCOHOL LABELING AND FORMULA
REVIEWS.
(a) In General.--The Secretary of the Treasury or his delegate
(hereinafter in this section referred to as the `Secretary') shall
establish a program requiring the payment of user fees for--
(1) requests for each certificate of alcohol label approval
required under the Federal Alcohol Administration Act (27
U.S.C. 201 et seq.) and for each request for exemption from
such requirement, and
(2) requests for each formula review, and requests for each
statement of process (including laboratory tests and analyses),
under such Act or under chapter 51 of the Internal Revenue Code
of 1986.
(b) Program Criteria.--
(1) In general.--The fees charged under the program
required by subsection (a) shall be determined such that the
Secretary estimates that the aggregate of such fees received
during any fiscal year will be $5,000,000.
(2) Minimum fees.--The fee charged under the program
required by subsection (a) shall not be less than--
(A) $50 for each request referred to in subsection
(a)(1), and
(B) $250 for each request referred to in subsection
(a)(2).
(c) Application of Section.--Subsection (a) shall apply to requests
made on or after the 90th day after the date of the enactment of this
Act.
(d) Deposit and Credit as Offsetting Receipts.--The amounts
collected by the Secretary under the program required by subsection (a)
(to the extent such amounts do not exceed $5,000,000) shall be
deposited into the Treasury as offsetting receipts and ascribed to the
alcohol compliance program of the Bureau of Alcohol, Tobacco, and
Firearms.
SEC. 14412. USE OF HARBOR MAINTENANCE TRUST FUND AMOUNTS FOR
ADMINISTRATIVE EXPENSES.
(a) In General.--Paragraph (3) of section 9505(c) (relating to
expenditures from Harbor Maintenance Trust Fund) is amended to read as
follows:
``(3) for the payment of all expenses of administration
incurred by the Department of the Treasury in administering
subchapter A of chapter 36 (relating to harbor maintenance
tax), but not in excess of $5,000,000 for any fiscal year.''
(b) Effective Date.--The amendment made by subsection (a) shall
apply to fiscal years beginning after the date of the enactment of this
Act.
SEC. 14413. INCREASE IN TAX ON FUEL USED IN COMMERCIAL TRANSPORTATION
ON INLAND WATERWAYS.
(a) In General.--The table contained in section 4042(a)(2)(A) is
amended to read as follows:
``If the use occurs during:
The tax per gallon is:
1994....................... 24 cents
1995....................... 40 cents
1996....................... 55 cents
1997 or thereafter......... 70 cents.''
(b) Effective Date.--The amendment made by subsection (a) shall
take effect on January 1, 1994.
PART III--PUBLIC DEBT LIMIT
SEC. 14421. INCREASE IN PUBLIC DEBT LIMIT.
(a) General Rule.--Subsection (b) of section 3101 of title 31,
United States Code, is amended by striking out the dollar limitation
contained in such subsection and inserting in lieu thereof
``$4,900,000,000,000''.
(b) Repeal of Temporary Increase.--Effective on and after the date
of the enactment of this Act, section 1 of Public Law 103-12 is hereby
repealed.
PART IV--VACCINE PROVISIONS
SEC. 14431. EXCISE TAX ON CERTAIN VACCINES MADE PERMANENT.
(a) Tax.--Subsection (c) of section 4131 (relating to tax on
certain vaccines) is amended to read as follows:
``(c) Application of Section.--The tax imposed by this section
shall apply--
``(1) after December 31, 1987, and before January 1, 1993,
and
``(2) during periods after the date of the enactment of
this subsection.''
(b) Trust Fund.--Paragraph (1) of section 9510(c) (relating to
expenditures from Vaccine Injury Compensation Trust Fund) is amended by
striking ``and before October 1, 1992,''.
(c) Study.--The Secretary of the Treasury, in consultation with the
Secretary of Health and Human Services, shall conduct a study of--
(1) the estimated amount that will be paid from the Vaccine
Injury Compensation Trust Fund with respect to vaccines
administered after September 30, 1988,
(2) the rates of vaccine-related injury or death with
respect to the various types of such vaccines,
(3) new vaccines and immunization practices being developed
or used for which amounts may be paid from such Trust Fund,
(4) whether additional vaccines should be included in the
vaccine injury compensation program, and
(5) the appropriate treatment of vaccines produced by State
governmental entities.
The report of such study shall be submitted not later than 1 year after
the date of the enactment of this Act, to the Committee on Ways and
Means of the House of Representatives and the Committee on Finance of
the Senate.
(d) Floor Stocks Tax.--
(1) Imposition of tax.--On any taxable vaccine--
(A) which was sold by the manufacturer, producer,
or importer before the date of the enactment of this
Act,
(B) on which no tax was imposed by section 4131 of
the Internal Revenue Code of 1986 (or, if such tax was
imposed, was credited or refunded), and
(C) which is held on such date by any person for
sale or use,
there is hereby imposed a tax in the amount determined under
section 4131(b) of such Code.
(2) Liability for tax and method of payment.--
(A) Liability for tax.--The person holding any
taxable vaccine to which the tax imposed by paragraph
(1) applies shall be liable for such tax.
(B) Method of payment.--The tax imposed by
paragraph (1) shall be paid in such manner as the
Secretary shall prescribe by regulations.
(C) Time for payment.--The tax imposed by paragraph
(1) shall be paid on or before the last day of the 6th
month beginning after the date of the enactment of this
Act.
(3) Definitions.--For purposes of this subsection, terms
used in this subsection which are also used in section 4131 of
such Code shall have the respective meanings such terms have in
such section.
(4) Other laws applicable.--All provisions of law,
including penalties, applicable with respect to the taxes
imposed by section 4131 of such Code shall, insofar as
applicable and not inconsistent with the provisions of this
subsection, apply to the floor stocks taxes imposed by
paragraph (1), to the same extent as if such taxes were imposed
by such section 4131.
SEC. 14432. CONTINUATION COVERAGE UNDER GROUP HEALTH PLANS OF COSTS OF
PEDIATRIC VACCINES.
(a) In General.--Paragraph (1) of section 4980B(f) is amended by
inserting ``the coverage of the costs of pediatric vaccines (as defined
under section 2162 of the Public Health Service Act) is not reduced
below the coverage provided by the plan as of May 1, 1993, and only
if'' after ``only if''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply with respect to plan years beginning after the date of the
enactment of this Act.
SEC. 14433. CHILDHOOD IMMUNIZATION TRUST FUND.
(a) In General.--Subchapter A of chapter 98 (relating to trust fund
code) is amended by adding at the end thereof the following new
section:
``SEC. 9512. CHILDHOOD IMMUNIZATION TRUST FUND.
``(a) Creation of Trust Fund.--There is established in the Treasury
of the United States a trust fund to be known as the `Childhood
Immunization Trust Fund', consisting of such amounts as may be
appropriated or credited to such Trust Fund as provided in this section
or section 9602(b).
``(b) Transfers to Trust Fund.--There are hereby appropriated to
the Childhood Immunization Trust Fund amounts equivalent to the taxes
received in the Treasury under any tax hereafter specified by law for
purposes of this subsection.
``(c) Expenditures From Trust Fund.--Amounts in the Childhood
Immunization Trust Fund shall be available, as provided in
appropriation Acts, only for purposes of making expenditures to carry
out part A of subtitle 3 of title XXI of the Public Health Service
Act.''
(b) Clerical Amendment.--The table of sections for such subchapter
A is amended by adding at the end thereof the following new item:
``Sec. 9512. Childhood Immunization Trust
Fund.''
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