[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 286 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 286

To amend the Public Health Service Act to facilitate the entering into 
of cooperative agreements between hospitals for the purpose of enabling 
such hospitals to share expensive medical or high technology equipment 
                  or services, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 5, 1993

 Mrs. Morella introduced the following bill; which was referred to the 
                    Committee on Energy and Commerce

_______________________________________________________________________

                                 A BILL


 
To amend the Public Health Service Act to facilitate the entering into 
of cooperative agreements between hospitals for the purpose of enabling 
such hospitals to share expensive medical or high technology equipment 
                  or services, and for other purposes.

    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 ``Hospital Cooperative Agreement 
Act''.

SEC. 2. PURPOSE.

    It is the purpose of this Act to encourage cooperation between 
hospitals in order to contain costs and achieve a more efficient health 
care delivery system through the elimination of unnecessary duplication 
and proliferation of expensive medical or high technology services or 
equipment.

SEC. 3. HOSPITAL TECHNOLOGY AND SERVICES SHARING DEMONSTRATION PROGRAM.

    Part D of title VI of the Public Health Service Act (42 U.S.C. 291k 
et seq.) is amended by adding at the end thereof the following new 
section:

``SEC. 647. HOSPITAL TECHNOLOGY AND SERVICES SHARING DEMONSTRATION 
              PROGRAM.

    ``(a) Establishment.--The Secretary shall establish a demonstration 
program under which the Secretary shall in fiscal year 1994 award ten 
5-year grants to eligible applicants to facilitate collaboration among 
two or more hospitals with respect to the provision of expensive, 
capital-intensive medical technology or other highly resource-intensive 
services. Such program shall be designed to demonstrate the extent to 
which such agreements result in a reduction in costs, an increase in 
access to care, and improvements in the quality of care with respect to 
the hospitals involved.
    ``(b) Eligible Applicants.--
            ``(1) In general.--To be eligible to receive a grant under 
        subsection (a), an entity (or entities) shall be a licensed 
        hospital (or hospitals) and shall prepare and submit to the 
        Secretary an application at such time, in such manner, and 
        containing such information as the Secretary may require, 
        including--
                    ``(A) a statement that such hospital (or hospitals) 
                desires to negotiate and enter into a voluntary 
                cooperative agreement under which such hospital (or 
                hospitals) is operating in one State or region for the 
                sharing of medical technology or services;
                    ``(B) a description of the nature and scope of the 
                activities contemplated under the cooperative 
                agreement;
                    ``(C) a description of the financial arrangement 
                between the hospitals that are parties to the 
                agreement; and
                    ``(D) any other information determined appropriate 
                by the Secretary.
            ``(2) Development of evaluation guidelines.--Not later than 
        90 days after the date of enactment of this section, the 
        Administrator for Health Care Policy and Research shall develop 
        evaluation guidelines with respect to applications submitted 
        under paragraph (1).
            ``(3) Evaluations of applications.--The Secretary, in 
        consultation with the Administrator for Health Care Policy and 
        Research, shall evaluate applications submitted under paragraph 
        (1). In determining which applications to approve for purposes 
        of awarding grants under subsection (a), the Secretary shall 
        consider whether the cooperative agreement described in each 
        such application meets guidelines developed under paragraph (2) 
        and is likely to result in--
                    ``(A) the enhancement of the quality of hospital or 
                hospital-related care;
                    ``(B) the preservation of hospital services in 
                geographical proximity to the communities traditionally 
                served by the applicant hospital (or hospitals);
                    ``(C) improvements in the cost-effectiveness of 
                high-technology services by the hospitals involved;
                    ``(D) improvements in the efficient utilization of 
                hospital resources and capital equipment;
                    ``(E) the provision of services that would not 
                otherwise be available; or
                    ``(F) the avoidance of duplication of hospital 
                resources.
    ``(c) Allocation of Grant Funds.--
            ``(1) In general.--Amounts provided under a grant awarded 
        under subsection (a) shall be used only to facilitate 
        collaboration among hospitals and may not be used to purchase 
        facilities or capital equipment. Such permissible uses may 
        include reimbursements for the expenses associated with 
        specialized personnel, administrative services, support 
        services, and instructional programs.
            ``(2) Grant award amount.--Hospitals applying for grants 
        under subsection (a) shall specify the desired grant award 
        amount. The Secretary shall determine the appropriate amount in 
        granting such awards.
            ``(3) Care in rural areas.--
                    ``(A) In general.--Not less than three of the 
                grants awarded under subsection (a) shall be used to 
                demonstrate the manner in which cooperative agreements 
                of the type described in such subsection may be used to 
                increase access to or quality of care in rural areas.
                    ``(B) Definition.--As used in subparagraph (A), the 
                term `rural areas' means those areas located outside of 
                metropolitan statistical areas.
    ``(d) Medical Technology and Services.--
            ``(1) In general.--Cooperative agreements facilitated under 
        this section shall provide for the sharing of medical 
        technology or eligible services among the hospitals which are 
        parties to such agreements.
            ``(2) Medical technology.--For purposes of this section, 
        the term `medical technology' includes the drugs, devices, 
        equipment and medical and surgical procedures utilized in 
        medical care, and the organizational and support systems within 
        which such care is provided, that--
                    ``(A) have high capital costs or extremely high 
                annual operating costs; and
                    ``(B) are technologies with respect to which there 
                is a reasonable expectation that shared ownership will 
                avoid a significant degree of the potential excess 
                capacity of such service in the community or region to 
                be served under such agreement.
            ``(3) Eligible services.--With respect to services that may 
        be shared under an agreement entered into under this section, 
        such services shall--
                    ``(A) either have high capital costs or extremely 
                high annual operating costs; and
                    ``(B) be services with respect to which there is a 
                reasonable expectation that shared ownership will avoid 
                a significant degree of the potential excess capacity 
                of such services in the community or region to be 
                served under such agreement.
        Such services may include mobile services.
    ``(e) Term.--The demonstration program established under this 
section shall continue for a term of 5 years.
    ``(f) Reports.--
            ``(1) In general.--Grantees shall submit annual reports to 
        the Secretary containing information on the demonstration 
        projects funded under this section, as required by the 
        Secretary.
            ``(2) To congress.--On the date that occurs 5 years after 
        the establishment of the demonstration program under this 
        section, the Secretary shall prepare and submit to the 
        appropriate committees of Congress, a report concerning the 
        potential for cooperative agreements of the type entered into 
        under this section to--
            ``(A) contain health care costs;
            ``(B) increase the access of individuals to medical 
        services; and
            ``(C) improve the quality of health care.
Such report shall also contain the recommendations of the Secretary 
with respect to future programs to facilitate cooperative agreements.
    ``(g) Relation to Other Laws.--
            ``(1) In general.--Notwithstanding any provision of the 
        antitrust laws, it shall not be considered a violation of the 
        antitrust laws for a hospital to enter into, and carry out 
        activities under, a cooperative agreement in accordance with 
        this section.
            ``(2) Definition.--For purposes of this subsection, the 
        term `antitrust laws' means--
                    ``(A) the Act entitled ``An Act to protect trade 
                and commerce against unlawful restraints and 
                monopolies'', approved July 2, 1890, commonly known as 
                the ``Sherman Act'' (26 Stat. 209; chapter 647; 15 
                U.S.C. 1 et seq.);
                    ``(B) the Federal Trade Commission Act, approved 
                September 26, 1914 (38 Stat. 717; chapter 311; 15 
                U.S.C. 41 et seq.);
                    ``(C) the Act entitled ``An Act to supplement 
                existing laws against unlawful restraints and 
                monopolies, and for other purposes'', approved October 
                15, 1914, commonly known as the ``Clayton Act'' (38 
                Stat. 730; chapter 323; 15 U.S.C. 12 et seq.; 18 U.S.C. 
                402, 660, 3285, 3691; 29 U.S.C. 52, 53); and
                    ``(D) any State antitrust laws that would prohibit 
                the activities described in paragraph (1).
    ``(h) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section, $2,500,000 for each of the 
fiscal years 1994 through 1998. Any appropriation pursuant to the 
preceding sentence shall be subject to section 601 of the Congressional 
Budget Act of 1974 (relating to discretionary spending limits).
    ``(i) Effective Date.--If the Agency for Health Care Policy and 
Research fails to establish guidelines pursuant to subsection (b)(2), 
the Secretary shall award grants under this section based on the 
criteria contained in subsection (b)(3).''.

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