[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4690 Introduced in House (IH)]

103d CONGRESS
  2d Session
                                H. R. 4690

 To provide assistance for the establishment of community rural health 
 networks in chronically underserved areas, to provide incentives for 
providers of health care services to furnish services in such areas, to 
 assist providers of emergency medical services in such areas, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 30, 1994

Mr. Bereuter introduced the following bill; which was referred jointly 
to the Committees on Energy and Commerce, Ways and Means, Education and 
                        Labor, and the Judiciary

_______________________________________________________________________

                                 A BILL


 
 To provide assistance for the establishment of community rural health 
 networks in chronically underserved areas, to provide incentives for 
providers of health care services to furnish services in such areas, to 
 assist providers of emergency medical services in such areas, 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; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Rural Health Care 
Improvement Act of 1994''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
 TITLE I--GRANTS TO ENCOURAGE ESTABLISHMENT OF COMMUNITY RURAL HEALTH 
                                NETWORKS

Sec. 101. Assistance for implementation of access plans for chronically 
                            underserved areas.
Sec. 102. Technical assistance grants for networks.
Sec. 103. Development grants for networks.
Sec. 104. Definitions.
  TITLE II--INCENTIVES FOR HEALTH PROFESSIONALS TO PRACTICE IN RURAL 
                                 AREAS

           Subtitle A--National Health Service Corps Program

Sec. 201. National health service corps loan repayments excluded from 
                            gross income.
Sec. 202. Modification in criteria for designation as health 
                            professional shortage area.
Sec. 203. Other provisions regarding national health service corps.
              Subtitle B--Incentives Under Other Programs

Sec. 211. Extension of additional payment under medicare for 
                            physicians' services furnished in former 
                            shortage areas.
Sec. 212. Refinement of geographic adjustment factor for medicare 
                            physicians' services.
Sec. 213. Extension of student loan deferments.
Sec. 214. Development of model State scope of practice law.
           TITLE III--ASSISTANCE FOR INSTITUTIONAL PROVIDERS

                 Subtitle A--Emergency Medical Systems

Sec. 301. Emergency medical services.
Sec. 302. Grants to states regarding aircraft for transporting rural 
                            victims of medical emergencies.
        Subtitle B--Assistance to Rural Providers Under Medicare

         Part 1--Medicare Essential Access Community Hospitals

Sec. 311. Amendments to essential access community hospital (EACH) 
                            program under medicare.
     Part 2--Establishment of Rural Emergency Access Care Hospitals

Sec. 321. Rural emergency access care hospitals described.
Sec. 322. Coverage of and payment for services.
Sec. 323. Effective date.
Subtitle D--Demonstration Projects to Encourage Primary Care and Rural-
                    Based Graduate Medical Education

Sec. 331. State and consortium demonstration projects.
Sec. 332. Goals for projects.
Sec. 333. Definitions.
                 TITLE IV--HOSPITAL ANTITRUST FAIRNESS

Sec. 401. Antitrust exemption.
Sec. 402. Requirements.
Sec. 403. Definition.

 TITLE I--GRANTS TO ENCOURAGE ESTABLISHMENT OF COMMUNITY RURAL HEALTH 
                                NETWORKS

SEC. 101. ASSISTANCE FOR DEVELOPMENT OF ACCESS PLANS FOR CHRONICALLY 
              UNDERSERVED AREAS.

    (a) Availability of Financial Assistance to Implement Action Plans 
to Increase Access.--
            (1) In general.--The Secretary shall provide grants (in 
        amounts determined in accordance with paragraph (3)) over a 3-
        year period to an eligible State for the development of plans 
        to increase access to health care services during such period 
        for residents of areas in the State that are designated as 
        chronically underserved areas in accordance with subsection 
        (b).
            (2) Eligibility requirements.--A State is eligible to 
        receive grants under this section if the State submits to the 
        Secretary (at such time and in such form as the Secretary may 
        require) assurances that the State has developed (or is in the 
        process of developing) a plan to increase the access of 
        residents of a chronically underserved area to health care 
        services that meets the requirements of subsection (c), 
        together with such other information and assurances as the 
        Secretary may require.
            (3) Amount of assistance.--
                    (A) In general.--Subject to subparagraph (B), the 
                amount of assistance provided to a State under this 
                subsection with respect to any plan during a 3-year 
                period shall be equal to--
                            (i) for the first year of the period, an 
                        amount equal to 100% of the amounts expended by 
                        the State during the year to implement the plan 
                        described in paragraph (1) (as reported to the 
                        Secretary in accordance with such requirements 
                        as the Secretary may impose);
                            (ii) for the second year of the period, an 
                        amount equal to 50% of the amounts expended by 
                        the State during the year to implement the 
                        plan; and
                            (iii) for the third year of the period, an 
                        amount equal to 33% of the amounts expended by 
                        the State during the year to implement the 
                        plan.
                    (B) Aggregate per plan limit.--The amount of 
                assistance provided to a State under this subsection 
                with respect to any plan may not exceed $100,000 during 
                any year of the 3-year period for which the State 
                receives assistance.
    (b) Designation of Areas.--
            (1) Designation by governor.--In accordance with the 
        guidelines developed under paragraph (2), the Governor of a 
        State may designate an area in the State as a chronically 
        underserved area for purposes of this section upon the request 
        of a local official of the area or upon the Governor's 
        initiative.
            (2) Guidelines for designation.--
                    (A) Development by secretary.--Not later than 1 
                year after the date of the enactment of this Act, the 
                Secretary shall develop guidelines for the designation 
                of areas as chronically underserved areas under this 
                section.
                    (B) Factors considered in development of 
                guidelines.--In developing guidelines under paragraph 
                (1), the Secretary shall consider the following 
                factors:
                            (i) Whether the area (or a significant 
                        portion of the area)--
                                    (I) is designated as a health 
                                professional shortage area (under 
                                section 332(a) of the Public Health 
                                Service Act), or meets the criteria for 
                                designation as such an area; or
                                    (II) was previously designated as 
                                such an area or previously met such 
                                criteria for an extended period prior 
                                to the designation of the area under 
                                this section (in accordance with 
                                criteria established by the Secretary).
                            (ii) The availability and adequacy of 
                        health care providers and facilities for 
                        residents of the area.
                            (iii) The extent to which the availability 
                        of assistance under other Federal and State 
                        programs has failed to alleviate the lack of 
                        access to health care services for residents of 
                        the area.
                            (iv) The percentage of residents of the 
                        area whose income is at or below the poverty 
                        level.
                            (v) The percentage of residents of the area 
                        who are age 65 or older.
                            (vi) The existence of cultural or 
                        geographic barriers to access to health care 
                        services in the area, including weather 
                        conditions.
            (3) Review by secretary.--No designation under paragraph 
        (1) shall take effect under this section unless the Secretary--
                    (A) has been notified of the proposed designation; 
                and
                    (B) has not, within 60 days after the date of 
                receipt of the notice, disapproved the designation.
            (4) Period of designation.--A designation under this 
        section shall be effective during a period specified by the 
        Governor of not longer than 3 years. The Governor may extend 
        the designation for additional 3-year periods, except that a 
        State may not receive assistance under subsection (a)(3) for 
        amounts expended during any such additional periods.
    (c) Requirements for State Access Plans.--A State plan to increase 
the access of residents of chronically underserved areas to health care 
services meets the requirements of this section if the Secretary finds 
that the plan was developed with the participation of health care 
providers and facilities and residents of the area that is the subject 
of the plan, together with such other requirements as the Secretary may 
impose.
    (d) Authorization of Appropriations.--There are authorized to be 
appropriated for assistance under this section $10,000,000 for each of 
the first 3 fiscal years beginning after the date on which the 
Secretary develops guidelines for the designation of areas as 
chronically underserved areas under subsection (b)(2).

SEC. 102. TECHNICAL ASSISTANCE GRANTS FOR NETWORKS.

    (a) In General.--The Secretary shall make funds available under 
this section to provide technical assistance (including information 
regarding eligibility for other Federal programs) and advice for 
entities described in subsection (b) seeking to establish or enhance a 
community rural health network in an underserved rural area.
    (b) Entities Eligible to Receive Funds.--The following entities are 
eligible to receive funds for technical assistance under this section:
            (1) An entity receiving a grant under section 103.
            (2) A State or unit of local government.
            (3) An entity providing health care services (including 
        health professional education services) in the area involved.
    (c) Use of Funds.--
            (1) In general.--Funds made available under this section 
        may be used--
                    (A) for planning a community health network and the 
                submission of the plan for the network to the Secretary 
                under section 103(c) (subject to the limitation 
                described in paragraph (2));
                    (B) to provide assistance in conducting community-
                based needs and prioritization, identifying existing 
                regional health resources, and developing networks, 
                utilizing existing local providers and facilities where 
                appropriate;
                    (C) to provide advice on obtaining the proper 
                balance of primary and secondary facilities for the 
                population served by the network;
                    (D) to provide assistance in coordinating 
                arrangements for tertiary care;
                    (E) to provide assistance in recruitment and 
                retention of health care professionals;
                    (F) to provide assistance in coordinating the 
                delivery of emergency services with the provision of 
                other health care services in the area served by the 
                network;
                    (G) to provide assistance in coordinating 
                arrangements for mental health and substance abuse 
                treatment services; and
                    (H) to provide information regarding the area or 
                proposed network's eligibility for Federal and State 
                assistance for health care-related activities, together 
                with information on funds available through private 
                sources.
            (2) Limitation on amount available for development of 
        network.--The amount of financial assistance available for 
        activities described in paragraph (1) may not exceed $50,000 
        and may not be available for a period of time exceeding 1 year.
    (d) Use of Rural Health Offices.--In carrying out this section with 
respect to entities in rural areas, the Secretary shall make funds 
available through--
            (1) not more than 10 regional centers acting as 
        clearinghouses for the distribution of such funds;
            (2) State Offices of Rural Health,
or any combination of such centers and Offices.
    (e) Authorization of Appropriations.--There are authorized to be 
appropriated $10,000,000 for each of fiscal years 1995 through 1999 to 
carry out this section. Amounts appropriated under this section shall 
be available until expended.

SEC. 103. DEVELOPMENT GRANTS FOR NETWORKS.

    (a) In General.--The Secretary shall provide financial assistance 
to eligible entities in order to provide for the development and 
implementation of community rural health networks.
    (b) Eligible Entities.--
            (1) In general.--An entity is eligible to receive financial 
        assistance under this section only if the entity--
                    (A) is (i) based in a rural area or (ii) is 
                described in paragraph (2), (3), or (4) of section 
                102(b),
                    (B) is undertaking to develop and implement a 
                community rural health network in an underserved rural 
                area (or underserved rural areas) with the active 
                participation of at least 3 health care providers or 
                facilities in the area, and
                    (C) has consulted with the local governments of the 
                area to be served by the network and with individuals 
                who reside in the area.
            (2) Coordination with providers outside of area 
        permitted.--Nothing in this section shall be construed as 
        preventing an entity that coordinates the delivery of services 
        in an underserved rural area with an entity outside the area 
        from qualifying for financial assistance under this section, or 
        as preventing an entity consisting of a consortia of members 
        located in adjoining States from qualifying for such 
        assistance.
            (3) Permitting entities not receiving funding for 
        development of plan to receive funding for implementation.--An 
        entity that is eligible to receive financial assistance under 
        this section may receive assistance to carry out activities 
        described in subsection (c)(1)(B) notwithstanding that the 
        entity does not receive assistance to carry out activities 
        described in subsection (c)(1)(A).
    (c) Use of Funds.--
            (1) In general.--Financial assistance made available to 
        eligible entities under this section may be used only--
                    (A) for the development of a community health 
                network and the submission of the plan for the network 
                to the Secretary; and
                    (B) after the Secretary approves the plan for the 
                network, for activities to implement the network, 
                including (but not limited to)--
                            (i) establishing information systems, 
                        including telecommunications,
                            (ii) recruiting health care providers,
                            (iii) providing services to enable 
                        individuals to have access to health care 
                        services, including transportation and language 
                        interpretation services (including 
                        interpretation services for the hearing-
                        impaired), and
                            (iv) establishing and operating a community 
                        health advisor program described in paragraph 
                        (2).
            (2) Community health advisor program.--
                    (A) Program described.--In paragraph (1), a 
                ``community health advisor program'' is a program under 
                which community health advisors carry out the following 
                activities:
                            (i) Collaborating efforts with health care 
                        providers and related entities to facilitate 
                        the provision of health services and health-
                        related social services.
                            (ii) Providing public education on health 
                        promotion and disease prevention and efforts to 
                        facilitate the use of available health services 
                        and health-related social services.
                            (iii) Providing health-related counseling.
                            (iv) Making referrals for available health 
                        services and health-related social services.
                            (v) Improving the ability of individuals to 
                        use health services and health-related social 
                        services under Federal, State, and local 
                        programs through assisting individuals in 
                        establishing eligibility under the programs.
                            (vi) Providing outreach services to inform 
                        the community of the availability of the 
                        services provided under the program.
                    (B) Community health advisor defined.--In 
                subparagraph (A), the term ``community health advisor'' 
                means, with respect to a community health advisor 
                program, an individual--
                            (i) who has demonstrated the capacity to 
                        carry out one or more of the activities carried 
                        out under the program; and
                            (ii) who, for not less than one year, has 
                        been a resident of the community in which the 
                        program is to be operated.
            (3) Limitations on activities funded.--Financial assistance 
        made available under this section may not be used for any of 
        the following:
                    (A) For a telecommunications system unless such 
                system is coordinated with, and does not duplicate, a 
                system existing in the area.
                    (B) For construction or remodeling of health care 
                facilities.
            (4) Limitation on amount available for development of 
        network.--The amount of financial assistance available for 
        activities described in paragraph (1)(A) may not exceed $50,000 
        and may not be made available for a period of time exceeding 1 
        year.
    (d) Application.--
            (1) In general.--No financial assistance shall be provided 
        under this section to an entity unless the entity has submitted 
        to the Secretary, in a time and manner specified by the 
        Secretary, and had approved by the Secretary an application.
            (2) Information to be included.--Each such application 
        shall include--
                    (A) a description of the community rural health 
                network, including service area and capacity, and
                    (B) a description of how the proposed network will 
                utilize existing health care facilities in a manner 
                that avoids unnecessary duplication.
    (e) Authorization of Appropriations.--
            (1) In general.--There are authorized to be appropriated 
        $100,000,000 for each of fiscal years 1995 through 1999 to 
        carry out this section. Amounts appropriated under this section 
        shall be available until expended.
            (2) Integration of other authorizations.--In order to 
        provide for the authorization of appropriations under paragraph 
        (1), notwithstanding any other provision of law, no funds are 
        authorized to be appropriated to carry out the following 
        programs in fiscal years after fiscal year 1994:
                    (A) The rural health transition grant program 
                (under section 4005(e) of the Omnibus Budget 
                Reconciliation Act of 1987).
                    (B) The rural health outreach program (for which 
                appropriations were annually provided under the 
                Departments of Labor, Health and Human Services, and 
                Education, and Related Agencies Appropriation Acts).
            (3) Annual limit on assistance to grantee.--The amount of 
        financial assistance provided to an entity under this section 
        during a year may not exceed $250,000.

SEC. 104. DEFINITIONS.

    For purposes of this title:
            (1) Community rural health network.--The term ``community 
        rural health network'' means a formal cooperative arrangement 
        between participating hospitals, physicians, and other health 
        care providers which--
                    (A) is located in an underserved rural area;
                    (B) furnishes health care services to individuals 
                residing in the area; and
                    (C) is governed by a board of directors selected by 
                participating health care providers and residents of 
                the area.
            (2) Rural area.--The term ``rural area'' has the meaning 
        given such term in section 1886(d)(2)(D) of the Social Security 
        Act.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (4) State.--The term ``State'' means each of the several 
        States, the District of Columbia, Puerto Rico, the Virgin 
        Islands, Guam, the Northern Mariana Islands, and American 
        Samoa.
            (5) Underserved rural area.--The term ``underserved rural 
        area'' means a rural area designated--
                    (A) as a health professional shortage area under 
                section 332(a) of the Public Health Service Act; or
                    (B) as a chronically underserved area under section 
                101.

  TITLE II--INCENTIVES FOR HEALTH PROFESSIONALS TO PRACTICE IN RURAL 
                                 AREAS

           Subtitle A--National Health Service Corps Program

SEC. 201. NATIONAL HEALTH SERVICE CORPS LOAN REPAYMENTS EXCLUDED FROM 
              GROSS INCOME.

    (a) In General.--Part III of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to items specifically excluded 
from gross income) is amended by redesignating section 137 as section 
138 and by inserting after section 136 the following new section:

``SEC. 137. NATIONAL HEALTH SERVICE CORPS LOAN REPAYMENTS.

    ``(a) General Rule.--Gross income shall not include any qualified 
loan repayment.
    ``(b) Qualified Loan Repayment.--For purposes of this section, the 
term `qualified loan repayment' means any payment made on behalf of the 
taxpayer by the National Health Service Corps Loan Repayment Program 
under section 338B(g) of the Public Health Service Act.''.
    (b) Conforming Amendment.--Paragraph (3) of section 338B(g) of the 
Public Health Service Act is amended by striking ``Federal, State, or 
local'' and inserting ``State or local''.
    (c) Clerical Amendment.--The table of sections for part III of 
subchapter B of chapter 1 of the Internal Revenue Code of 1986 is 
amended by striking the item relating to section 137 and inserting the 
following:

                              ``Sec. 137. National Health Service Corps 
                                        loan repayments.
                              ``Sec. 138. Cross references to other 
                                        Acts.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to payments made under section 338B(g) of the Public Health 
Service Act after the date of the enactment of this Act.

SEC. 202. MODIFICATION IN CRITERIA FOR DESIGNATION AS HEALTH 
              PROFESSIONAL SHORTAGE AREA.

    (a) Considerations Regarding Medicare and Medicaid Programs as 
Means of Payment.--Section 332(b) of the Public Health Service Act (42 
U.S.C. 254e(b)) is amended by adding at the end the following 
paragraph:
            ``(4) With respect to determining the need for health 
        services through the indicators of need under paragraphs (1) 
        and (2), consideration of the following:
                    ``(A) The number of individuals in the population 
                involved whose means of payment for health services is 
                the program under title XVIII of the Social Security 
                Act.
                    ``(B) The number of individuals in the population 
                whose means of payment for health services is the 
                program under title XIX of such Act.
                    ``(C) The number of individuals in the population 
                who are uninsured with respect to health policies or 
                plans.
                    ``(D) The percentage of the population constituted 
                by the aggregate number of individuals under 
                subparagraphs (A) through (C).
                    ``(E) In the case of community-based physicians who 
                provide primary health services and who are accepting 
                additional patients whose means of payment is through 
                the program established in title XVIII or XIX of the 
                Social Security Act, the percentage constituted by the 
                ratio of the number of such physicians to the number of 
                individuals in the population.''.
    (b) Relevance of Travel Times Within Frontier Areas.--Section 
332(a) of the Public Health Service Act (42 U.S.C. 245e(a)) is amended 
by adding at the end the following new paragraph:
            ``(4) With respect to meeting the criteria under paragraph 
        (1)(A) for an area to be designated as a health professional 
        shortage area, the Secretary shall, in the case of a frontier 
        area, make the determination of whether the frontier area is a 
        rational area for the delivery of health services without 
        regard to--
                    ``(A) the travel time between population centers in 
                the frontier area; or
                    ``(B) the travel time to contiguous area resources 
                in the frontier area.''.
    (c) Agency Recommendations for Improvements.--Not later than 
February 1, 1995, the Secretary of Health and Human Services shall 
submit to the Congress a report specifying the recommendations of the 
Secretary for improving the manner of determining the extent to which a 
geographic area has a need for assignments of members of the National 
Health Service Corps, and for equitably allocating such assignments 
among the geographic areas with a need for such assignments.
    (d) Effective Date.--This section shall take effect on October 1, 
1994, or upon the date of the enactment of this Act, whichever occurs 
later.

SEC. 203. OTHER PROVISIONS REGARDING NATIONAL HEALTH SERVICE CORPS.

    (a) Scholarship and Loan Repayment Programs.--
            (1) Authorization of appropriations.--Section 338H(b)(1) of 
        the Public Health Service Act (42 U.S.C. 254q(b)(1)) is 
        amended--
                    (A) by striking ``and'' after ``1991,''; and
                    (B) by striking ``through 2000.'' and inserting 
                ``through 1994, $150,000,000 for fiscal year 1995, 
                $175,000,000 for fiscal year 1996, $200,000,000 for 
                fiscal year 1997, $225,000,000 for fiscal year 1998, 
                and $250,000,000 for fiscal year 1999.''.
            (2) Allocation for participation of nurses in scholarship 
        program.--Section 338H(b)(2) of the Public Health Service Act 
        (42 U.S.C. 254q(b)(2)) is amended by adding at the end the 
        following subparagraph:
                    ``(C) Of the amounts appropriated under paragraph 
                (1) for fiscal year 1995 and subsequent fiscal years, 
                the Secretary shall reserve such amounts as may be 
                necessary to ensure that, of the aggregate number of 
                individuals who are participants in the Scholarship 
                Program, the total number who are being educated as 
                nurses or are serving as nurses, respectively, is 
                increased to 20 percent.''.
    (b) Increase in Number of Mental Health Professionals in Shortage 
Areas.--
            (1) In general.--Section 338H(b) of the Public Health 
        Service Act (42 U.S.C. 254q(b)) is amended by adding at the end 
        the following paragraph:
            ``(3) Mental health professionals.--In providing contracts 
        under this subpart for scholarships and loan repayments, the 
        Secretary shall ensure that an appropriate number of mental 
        health professionals is assigned under section 333 for health 
        professional shortage areas.''.
            (2) Applicability.--With respect to contracts for 
        scholarships and loan repayments under subpart III of part D of 
        title III of the Public Health Service Act, the amendment made 
        by subsection (a) applies with respect to contracts entered 
        into on or after October 1, 1994.

              Subtitle B--Incentives Under Other Programs

SEC. 211. EXTENSION OF ADDITIONAL PAYMENT UNDER MEDICARE FOR 
              PHYSICIANS' SERVICES FURNISHED IN FORMER SHORTAGE AREAS.

    (a) In General.--Section 1833(m) of the Social Security Act (42 
U.S.C. 1395l(m)) is amended by striking ``area,'' and inserting ``area 
(or, in the case of an area for which the designation as a health 
professional shortage area under such section is withdrawn, in the case 
of physicians' services furnished to such an individual during the 3-
year period beginning on the effective date of the withdrawal of such 
designation),''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to physicians' services furnished in an area for which the 
designation as a health professional shortage area under section 
332(a)(1)(A) of the Public Health Service Act is withdrawn on or after 
January 1, 1995.

SEC. 212. REFINEMENT OF GEOGRAPHIC ADJUSTMENT FACTOR FOR MEDICARE 
              PHYSICIANS' SERVICES.

    (a) Deadline for Initial Review and Revision.--Section 
1848(e)(1)(C) of the Social Security Act (42 U.S.C. 1395w-4(e)(1)(C)) 
is amended by adding at the end the following: ``The first such review 
and revision shall apply to services furnished on or after January 1, 
1997.''.
    (b) Authority To Adjust Index Value for Input Component Under 
Certain Circumstances.--(1) Section 1848(e)(1) of the Social Security 
Act (42 U.S.C. 1395w-4(e)(1)) is amended--
            (A) in subparagraph (A), by striking ``(B) and (C)'' and 
        inserting ``(B), (C), and (D)'';
            (B) by redesignating subparagraph (C) as subparagraph (D); 
        and
            (C) by inserting after subparagraph (B) the following:
                    ``(C) Special adjustment to correct for unique 
                local circumstances.--The Secretary may adjust the 
                value assigned to an input component of an index in a 
                fee schedule area if the Secretary determines that the 
                value that would otherwise apply in such area does not 
                accurately reflect the relative costs of such input for 
                such area because of unique local circumstances.''.
    (2) Section 1848(i)(1)(D) of the Social Security Act (42 U.S.C. 
1395w-4(i)(1)(D)) is amended by inserting ``(including any adjustment 
under subparagraph (C) thereof)'' after ``subsection (e)''.
    (c) Report on Review Process.--Not later than April 1, 1996, the 
Secretary of Health and Human Services (in this section referred to as 
the ``Secretary'') shall study and report to the Committee on Finance 
of the Senate and the Committees on Ways and Means and 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 
        sources.
    (d) Study on Low-Volume Adjustment in Isolated Areas.--(1) Not 
later than July 1, 1996, the Physician Payment Review Commission shall 
study and report to the Committee on Finance of the Senate and the 
Committees on Ways and Means and Energy and Commerce of the House of 
Representatives on the feasibility and desirability of providing for a 
special adjustment to the index value of the medical equipment and 
supplies input component of the index used under section 1848(e) of the 
Social Security Act with respect to services described in paragraph 
(2).
    (2) Services described in this paragraph are services--
            (A) furnished by a physician who practices in an isolated 
        area;
            (B) requiring the presence of expensive medical equipment 
        and supplies in the physician's office; and
            (C) with respect to which the cost per service of operating 
        the equipment is increased because of the low volume of 
        patients of such physician.

SEC. 213. EXTENSION OF STUDENT LOAN DEFERMENTS.

    (a) Stafford Loans.--
            (1) GSL loans.--Section 428(b)(1)(M) of the Higher 
        Education Act of 1965 (20 U.S.C. 1078(b)(1)(M)) is amended--
                    (A) by striking ``or'' at the end of clause (ii);
                    (B) by inserting ``or'' after the semicolon at the 
                end of clause (iii); and
                    (C) by adding at the end thereof the following new 
                clause:
                            ``(iv) during which the borrower is serving 
                        in an internship or residency program in 
                        preparation for practice in an area of primary 
                        care (including internal medicine, pediatrics, 
                        obstetrics/gynecology, family medicine, and 
                        osteopathy);''.
            (2) FISL loans.--Section 427(a)(2)(C) of such Act (20 
        U.S.C. 1077(a)(2)(C)) is amended--
                    (A) by striking ``or'' at the end of clause (ii);
                    (B) by inserting ``or'' after the semicolon at the 
                end of clause (iii); and
                    (C) by adding at the end thereof the following new 
                clause:
                            ``(iv) during which the borrower is serving 
                        in an internship or residency program in 
                        preparation for practice in an area of primary 
                        care (including internal medicine, pediatrics, 
                        obstetrics/gynecology, family medicine, and 
                        osteopathy);''.
    (b) Perkins Loans.--Section 464(c)(2)(A) of such Act (20 U.S.C. 
1087dd(c)(2)(A)) is amended--
            (1) by striking ``or'' at the end of clause (iii);
            (2) by inserting ``or'' after the semicolon at the end of 
        clause (iv); and
            (3) by adding at the end thereof the following new clause:
                            ``(v) during which the borrower is serving 
                        in an internship or residency program in 
                        preparation for practice in an area of primary 
                        care (including internal medicine, pediatrics, 
                        obstetrics/gynecology, family medicine, and 
                        osteopathy);''.
    (c) Effective Date.--The amendments made by this section shall 
apply on and after the date of the enactment of this Act with respect 
to loans made under the Higher Education Act of 1965 before, on, or 
after that date.

SEC. 214. DEVELOPMENT OF MODEL STATE SCOPE OF PRACTICE LAW.

    (a) In General.--The Secretary of Health and Human Services shall 
develop and publish a model law that may be adopted by States to 
increase the access of individuals residing in underserved rural areas 
to health care services by expanding the services which non-physician 
health care professionals may provide in such areas.
    (b) Deadline.--The Secretary shall publish the model law developed 
under subsection (a) not later than 1 year after the date of the 
enactment of this Act.

           TITLE III--ASSISTANCE FOR INSTITUTIONAL PROVIDERS

                 Subtitle A--Emergency Medical Systems

SEC. 301. EMERGENCY MEDICAL SERVICES.

    (a) Establishment of Federal Office.--Title XII of the Public 
Health Service Act (42 U.S.C. 300d et seq.) is amended--
            (1) in the heading for the title, by striking ``TRAUMA 
        CARE'' and inserting ``EMERGENCY MEDICAL SERVICES'';
            (2) in the heading for part A, by striking ``General'' and 
        all that follows and inserting ``General Authorities and 
        Duties''; and
            (3) by amending section 1201 to read as follows:

``SEC. 1201. ESTABLISHMENT OF OFFICE OF EMERGENCY MEDICAL SERVICES.

    ``(a) In General.--The Secretary shall establish an office to be 
known as the Office of Emergency Medical Services, which shall be 
headed by a director appointed by the Secretary. The Secretary shall 
carry out this title acting through the Director of such Office.
    ``(b) General Authorities and Duties.--With respect to emergency 
medical services (including trauma care), the Secretary shall--
            ``(1) conduct and support research, training, evaluations, 
        and demonstration projects;
            ``(2) foster the development of appropriate, modern systems 
        of such services through the sharing of information among 
        agencies and individuals involved in the study and provision of 
        such services;
            ``(3) foster the development of regional systems for the 
        provision of such services;
            ``(4) sponsor workshops and conferences;
            ``(5) as appropriate, disseminate to public and private 
        entities information obtained in carrying out paragraphs (1) 
        through (4);
            ``(6) provide technical assistance to State and local 
        agencies;
            ``(7) coordinate activities of the Department of Health and 
        Human Services; and
            ``(8) as appropriate, coordinate activities of such 
        Department with activities of other Federal agencies.
    ``(c) Certain Requirements.--With respect to emergency medical 
services (including trauma care), the Secretary shall ensure that 
activities under subsection (b) are carried out regarding--
            ``(1) maintaining an adequate number of health 
        professionals with expertise in the provision of the services, 
        including hospital-based professionals and prehospital-based 
        professionals;
            ``(2) developing, periodically reviewing, and revising as 
        appropriate, in collaboration with appropriate public and 
        private entities, guidelines for the provision of such services 
        (including, for various typical circumstances, guidelines on 
        the number and variety of professionals, on equipment, and on 
        training);
            ``(3) the appropriate use of available technologies, 
        including communications technologies; and
            ``(4) the unique needs of underserved inner-city areas and 
        underserved rural areas.
    ``(d) Grants, Cooperative Agreements, and Contracts.--In carrying 
out subsections (b) and (c), the Secretary may make grants and enter 
into cooperative agreements and contracts.
    ``(e) Definitions.--For purposes of this part:
            ``(1) The term `hospital-based professional' means a health 
        professional (including an allied health professional) who has 
        expertise in providing one or more emergency medical services 
        and who normally provides the services at a medical facility.
            ``(2) The term `prehospital-based professional' means a 
        health professional (including an allied health professional) 
        who has expertise in providing one or more emergency medical 
        services and who normally provides the services at the site of 
        the medical emergency or during transport to a medical 
        facility.''.
    (b) State Offices of Emergency Medical Services; Demonstration 
Program Regarding Telecommunications.--Part A of title XII of the 
Public Health Service Act (42 U.S.C. 300d et seq.), as amended by 
section 601(b) of Public Law 103-183 (107 Stat. 2238), is amended--
            (1) by redesignating sections 1202 and 1203 as sections 
        1203 and 1204, respectively;
            (2) by inserting after section 1201 the following section:

``SEC. 1202. STATE OFFICES OF EMERGENCY MEDICAL SERVICES.

    ``(a) Program of Grants.--The Secretary may make grants to States 
for the purpose of improving the availability and quality of emergency 
medical services through the operation of State offices of emergency 
medical services.
    ``(b) Requirement of Matching Funds.--
            ``(1) In general.--The Secretary may not make a grant under 
        subsection (a) unless the State involved agrees, with respect 
        to the costs to be incurred by the State in carrying out the 
        purpose described in such subsection, to provide non-Federal 
        contributions toward such costs in an amount that--
                    ``(A) for the first fiscal year of payments under 
                the grant, is not less than $1 for each $3 of Federal 
                funds provided in the grant;
                    ``(B) for any second fiscal year of such payments, 
                is not less than $1 for each $1 of Federal funds 
                provided in the grant; and
                    ``(C) for any third fiscal year of such payments, 
                is not less than $3 for each $1 of Federal funds 
                provided in the grant.
            ``(2) Determination of amount of non-federal 
        contribution.--
                    ``(A) Subject to subparagraph (B), non-Federal 
                contributions required in paragraph (1) may be in cash 
                or in kind, fairly evaluated, including plant, 
                equipment, or services. Amounts provided by the Federal 
                Government, or services assisted or subsidized to any 
                significant extent by the Federal Government, may not 
                be included in determining the amount of such non-
                Federal contributions.
                    ``(B) The Secretary may not make a grant under 
                subsection (a) unless the State involved agrees that--
                            ``(i) for the first fiscal year of payments 
                        under the grant, 100 percent or less of the 
                        non-Federal contributions required in paragraph 
                        (1) will be provided in the form of in-kind 
                        contributions;
                            ``(ii) for any second fiscal year of such 
                        payments, not more than 50 percent of such non-
                        Federal contributions will be provided in the 
                        form of in-kind contributions; and
                            ``(iii) for any third fiscal year of such 
                        payments, such non-Federal contributions will 
                        be provided solely in the form of cash.
    ``(c) Certain Required Activities.--The Secretary may not make a 
grant under subsection (a) unless the State involved agrees that 
activities carried out by an office operated pursuant to such 
subsection will include--
            ``(1) coordinating the activities carried out in the State 
        that relate to emergency medical services;
            ``(2) activities regarding the matters described in 
        paragraphs (1) through (4) section 1201(b); and
            ``(3) identifying Federal and State programs regarding 
        emergency medical services and providing technical assistance 
        to public and nonprofit private entities regarding 
        participation in such programs.
    ``(d) Requirement Regarding Annual Budget for Office.--The 
Secretary may not make a grant under subsection (a) unless the State 
involved agrees that, for any fiscal year for which the State receives 
such a grant, the office operated pursuant to subsection (a) will be 
provided with an annual budget of not less than $50,000.
    ``(e) Certain Uses of Funds.--
            ``(1) Restrictions.--The Secretary may not make a grant 
        under subsection (a) unless the State involved agrees that--
                    ``(A) if research with respect to emergency medical 
                services is conducted pursuant to the grant, not more 
                than 10 percent of the grant will be expended for such 
                research; and
                    ``(B) the grant will not be expended to provide 
                emergency medical services (including providing cash 
                payments regarding such services).
            ``(2) Establishment of office.--Activities for which a 
        State may expend a grant under subsection (a) include paying 
        the costs of establishing an office of emergency medical 
        services for purposes of such subsection.
    ``(f) Reports.--The Secretary may not make a grant under subsection 
(a) unless the State involved agrees to submit to the Secretary reports 
containing such information as the Secretary may require regarding 
activities carried out under this section by the State.
    ``(g) Requirement of Application.--The Secretary may not make a 
grant under subsection (a) unless 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.''; and
            (3) in section 1204 (as redesignated by paragraph (1) of 
        this subsection)--
                    (A) by redesignating subsection (c) as subsection 
                (d); and
                    (B) by inserting after subsection (b) the following 
                new subsection:
    ``(c) Demonstration Program Regarding Telecommunications.--
            ``(1) Linkages for rural facilities.--Projects under 
        subsection (a)(1) shall include demonstration projects to 
        establish telecommunications between rural medical facilities 
        and medical facilities that have expertise or equipment that 
        can be utilized by the rural facilities through the 
        telecommunications.
            ``(2) Modes of communication.--The Secretary shall ensure 
        that the telecommunications technologies demonstrated under 
        paragraph (1) include interactive video telecommunications, 
        static video imaging transmitted through the telephone system, 
        and facsimiles transmitted through such system.''.
    (c) Funding.--Section 1232 of the Public Health Service Act (42 
U.S.C. 300d-32) is amended by striking subsections (a) and (b) and 
inserting the following:
    ``(a) Emergency Medical Services Generally.--
            ``(1) In general.--For the purpose of carrying out section 
        1201 other than with respect to trauma care, and for the 
        purpose of carrying out section 1204(c), there are authorized 
        to be appropriated $2,000,000 for fiscal year 1995, and such 
        sums as may be necessary for each of the fiscal years 1996 and 
        1997.
            ``(2) State offices.--For the purpose of carrying out 
        section 1202, there are authorized to be appropriated 
        $3,000,000 for fiscal year 1995, and such sums as may be 
        necessary for each of the fiscal years 1996 and 1997.
    ``(b) Trauma Care and Certain Other Activities.--
            ``(1) In general.--For the purpose of carrying out part A 
        with respect to trauma care, and for the purpose of carrying 
        out part B, there are authorized to be appropriated $60,000,000 
        for fiscal year 1995, and such sums as may be necessary for 
        each of the fiscal years 1996 and 1997.
            ``(2) Allocation of funds by secretary.--
                    ``(A) For the purpose of carrying out part A with 
                respect to trauma care, the Secretary shall make 
                available 10 percent of the amounts appropriated for a 
                fiscal year under paragraph (1).
                    ``(B) For the purpose of carrying out section 1204 
                (other than subsection (c) of such section), the 
                Secretary shall make available 10 percent of the 
                amounts appropriated for a fiscal year under paragraph 
                (1).
                    ``(C)(i) For the purpose of making allotments under 
                section 1211(a), the Secretary shall, subject to 
                subsection (c), make available 80 percent of the 
                amounts appropriated for a fiscal year under paragraph 
                (1).
                    ``(ii) Amounts paid to a State under section 
                1211(a) for a fiscal year shall, for the purposes for 
                which the amounts were paid, remain available for 
                obligation until the end of the fiscal year immediately 
                following the fiscal year for which the amounts were 
                paid.''.

SEC. 302. GRANTS TO STATES REGARDING AIRCRAFT FOR TRANSPORTING RURAL 
              VICTIMS OF MEDICAL EMERGENCIES.

    Part E of title XII of the Public Health Service Act (42 U.S.C. 
300d-51 et seq.) is amended by adding at the end the following new 
section:

``SEC. 1252. GRANTS FOR SYSTEMS TO TRANSPORT RURAL VICTIMS OF MEDICAL 
              EMERGENCIES.

    ``(a) In General.--The Secretary shall make grants to States to 
assist such States in the creation or enhancement of air medical 
transport systems that provide victims of medical emergencies in rural 
areas with access to treatments for the injuries or other conditions 
resulting from such emergencies.
    ``(b) Application and Plan.--
            ``(1) Application.--To be eligible to receive a grant under 
        subsection (a), a State shall prepare and submit to the 
        Secretary an application in such form, made in such manner, and 
        containing such agreements, assurances, and information, 
        including a State plan as required in paragraph (2), as the 
        Secretary determines to be necessary to carry out this section.
            ``(2) State plan.--An application submitted under paragraph 
        (1) shall contain a State plan that shall--
                    ``(A) describe the intended uses of the grant 
                proceeds and the geographic areas to be served;
                    ``(B) demonstrate that the geographic areas to be 
                served, as described under subparagraph (A), are rural 
                in nature;
                    ``(C) demonstrate that there is a lack of 
                facilities available and equipped to deliver advanced 
                levels of medical care in the geographic areas to be 
                served;
                    ``(D) demonstrate that in utilizing the grant 
                proceeds for the establishment or enhancement of air 
                medical services the State would be making a cost-
                effective improvement to existing ground-based or air 
                emergency medical service systems;
                    ``(E) demonstrate that the State will not utilize 
                the grant proceeds to duplicate the capabilities of 
                existing air medical systems that are effectively 
                meeting the emergency medical needs of the populations 
                they serve;
                    ``(F) demonstrate that in utilizing the grant 
                proceeds the State is likely to achieve a reduction in 
                the morbidity and mortality rates of the areas to be 
                served, as determined by the Secretary;
                    ``(G) demonstrate that the State, in utilizing the 
                grant proceeds, will--
                            ``(i) maintain the expenditures of the 
                        State for air and ground medical transport 
                        systems at a level equal to not less than the 
                        level of such expenditures maintained by the 
                        State for the fiscal year preceding the fiscal 
                        year for which the grant is received; and
                            ``(ii) ensure that recipients of direct 
                        financial assistance from the State under such 
                        grant will maintain expenditures of such 
                        recipients for such systems at a level at least 
                        equal to the level of such expenditures 
                        maintained by such recipients for the fiscal 
                        year preceding the fiscal year for which the 
                        financial assistance is received;
                    ``(H) demonstrate that persons experienced in the 
                field of air medical service delivery were consulted in 
                the preparation of the State plan; and
                    ``(I) contain such other information as the 
                Secretary may determine appropriate.
    ``(c) Considerations in Awarding Grants.--In determining whether to 
award a grant to a State under this section, the Secretary shall--
            ``(1) consider the rural nature of the areas to be served 
        with the grant proceeds and the services to be provided with 
        such proceeds, as identified in the State plan submitted under 
        subsection (b); and
            ``(2) give preference to States with State plans that 
        demonstrate an effective integration of the proposed air 
        medical transport systems into a comprehensive network or plan 
        for regional or statewide emergency medical service delivery.
    ``(d) State Administration and Use of Grant.--
            ``(1) In general.--The Secretary may not make a grant to a 
        State under subsection (a) unless the State agrees that such 
        grant will be administered by the State agency with principal 
        responsibility for carrying out programs regarding the 
        provision of medical services to victims of medical emergencies 
        or trauma.
            ``(2) Permitted uses.--A State may use amounts received 
        under a grant awarded under this section to award subgrants to 
        public and private entities operating within the State.
            ``(3) Opportunity for public comment.--The Secretary may 
        not make a grant to a State under subsection (a) unless that 
        State agrees that, in developing and carrying out the State 
        plan under subsection (b)(2), the State will provide public 
        notice with respect to the plan (including any revisions 
        thereto) and facilitate comments from interested persons.
    ``(e) Number of Grants.--The Secretary shall award grants under 
this section to not less than 7 States.
    ``(f) Reports.--
            ``(1) Requirement.--A State that receives a grant under 
        this section shall annually (during each year in which the 
        grant proceeds are used) prepare and submit to the Secretary a 
        report that shall contain--
                    ``(A) a description of the manner in which the 
                grant proceeds were utilized;
                    ``(B) a description of the effectiveness of the air 
                medical transport programs assisted with grant 
                proceeds; and
                    ``(C) such other information as the Secretary may 
                require.
            ``(2) Termination of funding.--In reviewing reports 
        submitted under paragraph (1), if the Secretary determines that 
        a State is not using amounts provided under a grant awarded 
        under this section in accordance with the State plan submitted 
        by the State under subsection (b), the Secretary may terminate 
        the payment of amounts under such grant to the State until such 
        time as the Secretary determines that the State comes into 
        compliance with such plan.
    ``(g) Definition.--As used in this section, the term `rural areas' 
means geographic areas that are located outside of standard 
metropolitan statistical areas, as identified by the Secretary.
    ``(h) Authorization of Appropriations.--There are authorized to be 
appropriated to make grants under this section, $15,000,000 for fiscal 
year 1995, and such sums as may be necessary for each of the fiscal 
years 1996 and 1997.''.

        Subtitle B--Assistance to Rural Providers Under Medicare

         PART 1--MEDICARE ESSENTIAL ACCESS COMMUNITY HOSPITALS

SEC. 311. AMENDMENTS TO ESSENTIAL ACCESS COMMUNITY HOSPITAL (EACH) 
              PROGRAM UNDER MEDICARE.

    (a) Increasing Number of Participating States.--Section 1820(a)(1) 
of the Social Security Act (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) of such Act (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) 
        of such Act (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) of such Act 
        (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 of such Act (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);
                            (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)'', and
                                    (III) by striking ``or (iii)'' and 
                                all that follows through ``section,''; 
                                and
                            (iii) 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) of such Act (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 of such Act (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) 
                of such Act (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) of such Act (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) of such Act (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) Deadline for Development of Prospective Payment System for 
Inpatient Rural Primary Care Hospital Services.--Section 1814(l)(2) of 
such Act (42 U.S.C. 1395f(l)(2)) is amended by striking ``January 1, 
1993'' and inserting ``January 1, 1996''.
    (f) Payment for Outpatient Rural Primary Care Hospital Services.--
            (1) Implementation of prospective payment system.--Section 
        1834(g) of such Act (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) of such Act (42 U.S.C. 1395m(g)(1)) is 
        amended by adding at the end the following new flush sentence:
        ``The amount of payment shall be determined under either method 
        without regard to the amount of the customary or other 
        charge.''.
    (g) Clarification of Physician Staffing Requirement for Rural 
Primary Care Hospitals.--Section 1820(f)(1)(H) of such Act (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).''.
    (h) Technical Amendments Relating to Part A Deductible, 
Coinsurance, and Spell of Illness.--(1) Section 1812(a)(1) of such Act 
(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) of such Act (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) of such Act (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) of such Act (42 U.S.C. 1395x(a)) is amended--
            (A) in paragraph (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''.
    (i) Authorization of Appropriations.--Section 1820(l) of such Act 
(42 U.S.C. 1395i-4(l)), as redesignated by subsection (c)(2)(A), is 
amended by striking ``1990, 1991, and 1992'' and inserting ``1990 
through 1995''.
    (j) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

     PART 2--ESTABLISHMENT OF RURAL EMERGENCY ACCESS CARE HOSPITALS

SEC. 321. RURAL EMERGENCY ACCESS CARE HOSPITALS DESCRIBED.

    (a) In General.--Section 1861 of the Social Security Act (42 U.S.C. 
1395x) is amended by adding at the end the following new subsection:

  ``Rural Emergency Access Care Hospital; Rural Emergency Access Care 
                           Hospital Services

    ``(oo)(1) The term `rural emergency access care hospital' means, 
for a fiscal year, a facility with respect to which the Secretary finds 
the following:
            ``(A) The facility is located in a rural area (as defined 
        in section 1886(d)(2)(D)).
            ``(B) The facility was a hospital under this title at any 
        time during the 5-year period that ends on the date of the 
        enactment of this subsection.
            ``(C) The facility is in danger of closing due to low 
        inpatient utilization rates and negative operating losses, and 
        the closure of the facility would limit the access of 
        individuals residing in the facility's service area to 
        emergency services.
            ``(D) The facility has entered into (or plans to enter 
        into) an agreement with a hospital with a participation 
        agreement in effect under section 1866(a), and under such 
        agreement the hospital shall accept patients transferred to the 
        hospital from the facility and receive data from and transmit 
        data to the facility.
            ``(E) There is a practitioner who is qualified to provide 
        advanced cardiac life support services (as determined by the 
        State in which the facility is located) on-site at the facility 
        on a 24-hour basis.
            ``(F) A physician is available on-call to provide emergency 
        medical services on a 24-hour basis.
            ``(G) The facility meets such staffing requirements as 
        would apply under section 1861(e) to a hospital located in a 
        rural area, except that--
                    ``(i) the facility need not meet hospital standards 
                relating to the number of hours during a day, or days 
                during a week, in which the facility must be open, 
                except insofar as the facility is required to provide 
                emergency care on a 24-hour basis under subparagraphs 
                (E) and (F); and
                    ``(ii) the facility may provide any services 
                otherwise required to be provided by a full-time, on-
                site dietician, pharmacist, laboratory technician, 
                medical technologist, or radiological technologist on a 
                part-time, off-site basis.
            ``(H) The facility meets the requirements applicable to 
        clinics and facilities under subparagraphs (C) through (J) of 
        paragraph (2) of section 1861(aa) and of clauses (ii) and (iv) 
        of the second sentence of such paragraph (or, in the case of 
        the requirements of subparagraph (E), (F), or (J) of such 
        paragraph, would meet the requirements if any reference in such 
        subparagraph to a `nurse practitioner' or to `nurse 
        practitioners' was deemed to be a reference to a `nurse 
        practitioner or nurse' or to `nurse practitioners or nurses'); 
        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).
    ``(2) The term `rural emergency access care hospital services' 
means the following services provided by a rural emergency access care 
hospital:
            ``(A) An appropriate medical screening examination (as 
        described in section 1867(a)).
            ``(B) Necessary stabilizing examination and treatment 
        services for an emergency medical condition and labor (as 
        described in section 1867(b)).''.
    (b) Requiring Rural Emergency Access Care Hospitals to Meet 
Hospital Anti-Dumping Requirements.--Section 1867(e)(5) of such Act (42 
U.S.C. 1395dd(e)(5)) is amended by striking ``1861(mm)(1))'' and 
inserting ``1861(mm)(1)) and a rural emergency access care hospital (as 
defined in section 1861(oo)(1))''.

SEC. 322. COVERAGE OF AND PAYMENT FOR SERVICES.

    (a) Coverage Under Part B.--Section 1832(a)(2) of the Social 
Security Act (42 U.S.C. 1395k(a)(2)) is amended--
            (1) by striking ``and'' at the end of subparagraph (I);
            (2) by striking the period at the end of subparagraph (J) 
        and inserting ``; and''; and
            (3) by adding at the end the following new subparagraph:
                    ``(K) rural emergency access care hospital services 
                (as defined in section 1861(oo)(2)).''.
    (b) Payment Based on Payment for Outpatient Rural Primary Care 
Hospital Services.--
            (1) In general.--Section 1833(a)(6) of the Social Security 
        Act (42 U.S.C. 1395l(a)(6)) is amended by striking 
        ``services,'' and inserting ``services and rural emergency 
        access care hospital services,''.
            (2) Payment methodology described.--Section 1834(g) of such 
        Act (42 U.S.C. 1395m(g)) is amended--
                    (A) in the heading, by striking ``Services'' and 
                inserting ``Services and Rural Emergency Access Care 
                Hospital Services'';
                    (B) 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'';
                    (C) in paragraph (1), 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.'';
                    (D) in paragraph (2), by striking ``January 1, 
                1993,'' and inserting ``January 1, 1996,''; and
                    (E) by adding at the end the following new 
                paragraph:
            ``(3) Application of methods to payment for rural emergency 
        access care hospital services.--The amount of payment for rural 
        emergency access care hospital services provided during a year 
        shall be determined using the applicable method provided under 
        this subsection for determining payment for outpatient rural 
        primary care hospital services during the year.''.

SEC. 323. EFFECTIVE DATE.

    The amendments made by this part shall apply to fiscal years 
beginning on or after October 1, 1994.

  Subtitle D--Demonstration Proj- ects to Encourage Primary Care and 
                 Rural-Based Graduate Medical Education

SEC. 331. STATE AND CONSORTIUM DEMONSTRATION PROJECTS.

    (a) In General.--
            (1) Participation of states and consortia.--The Secretary 
        shall establish and conduct a demonstration project to increase 
        the number and percentage of medical students entering primary 
        care practice relative to those entering nonprimary care 
        practice under which the Secretary shall make payments in 
        accordance with subsection (d)--
                    (A) to not more than 10 States for the purpose of 
                testing and evaluating mechanisms to meet the goals 
                described in section 342; and
                    (B) to not more than 10 health care training 
                consortia for the purpose of testing and evaluating 
                mechanisms to meet such goals.
            (2) Exclusion of consortia in participating states.--A 
        consortia may not receive payments under the demonstration 
        project under paragraph (1)(B) if any of its members is located 
        in a State receiving payments under the project under paragraph 
        (1)(A).
    (b) Applications.--
            (1) In general.--Each State and consortium desiring to 
        conduct a demonstration project under this section shall 
        prepare and submit to the Secretary an application, at such 
        time, in such manner, and containing such information as the 
        Secretary may require to assure that the State or consortium 
        will meet the goals described in section 342. In the case of an 
        application of a State, the application shall include--
                    (A) information demonstrating that the State has 
                consulted with interested parties with respect to the 
                project, including State medical associations, State 
                hospital associations, and medical schools located in 
                the State;
                    (B) an assurance that no hospital conducting an 
                approved medical residency training program in the 
                State will lose more than 10 percent of such hospital's 
                approved medical residency positions in any year as a 
                result of the project; and
                    (C) an explanation of a plan for evaluating the 
                impact of the project in the State.
            (2) Approval of applications.--A State or consortium that 
        submits an application under paragraph (1) may begin a 
        demonstration project under this subsection--
                    (A) upon approval of such application by the 
                Secretary; or
                    (B) at the end of the 60-day period beginning on 
                the date such application is submitted, unless the 
                Secretary denies the application during such period.
            (3) Notice and comment.--A State or consortium shall issue 
        a public notice on the date it submits an application under 
        paragraph (1) which contains a general description of the 
        proposed demonstration project. Any interested party may 
        comment on the proposed demonstration project to the State or 
        consortium or the Secretary during the 30-day period beginning 
        on the date the public notice is issued.
    (c) Specific Requirements for Participants.--
            (1) Requirements for states.--Each State participating in 
        the demonstration project under this subtitle shall use the 
        payments provided under subsection (d) to test and evaluate 
        either of the following mechanisms to increase the number and 
        percentage of medical students entering primary care practice 
        relative to those entering nonprimary care practice:
                    (A) Use of alternative weighting factors.--
                            (i) In general.--The State may make 
                        payments to hospitals in the State for direct 
                        graduate medical education costs in amounts 
                        determined under the methodology provided under 
                        section 1886(h) of the Social Security Act, 
                        except that the State shall apply weighting 
                        factors that are different than the weighting 
                        factors otherwise set forth in section 
                        1886(h)(4)(C) of the Social Security Act.
                            (ii) Use of payments for primary care 
                        residents.--In applying different weighting 
                        factors under clause (i), the State shall 
                        ensure that the amount of payment made to 
                        hospitals for costs attributable to primary 
                        care residents shall be greater than the amount 
                        that would have been paid to hospitals for 
                        costs attributable to such residents if the 
                        State had applied the weighting factors 
                        otherwise set forth in section 1886(h)(4)(C) of 
                        the Social Security Act.
                    (B) Payments for medical education through 
                consortium.--The State may make payments for graduate 
                medical education costs through payments to a health 
                care training consortium (or through any entity 
                identified by such a consortium as appropriate for 
                receiving payments on behalf of the consortium) that is 
                established in the State but that is not otherwise 
                participating in the demonstration project.
            (2) Requirements for consortium.--
                    (A) In general.--In the case of a consortium 
                participating in the demonstration project under this 
                subtitle, the Secretary shall make payments for 
                graduate medical education costs through a health care 
                training consortium whose members provide medical 
                residency training (or through any entity identified by 
                such a consortium as appropriate for receiving payments 
                on behalf of the consortium).
                    (B) Use of payments.--
                            (i) In general.--Each consortium receiving 
                        payments under subparagraph (A) shall use such 
                        funds to conduct activities which test and 
                        evaluate mechanisms to increase the number and 
                        percentage of medical students entering primary 
                        care practice relative to those entering 
                        nonprimary care practice, and may use such 
                        funds for the operation of the consortium.
                            (ii) Payments to participating programs.--
                        The consortium shall ensure that the majority 
                        of the payments received under subparagraph (A) 
                        are directed to consortium members for primary 
                        care residency programs, and shall designate 
                        for each resident assigned to the consortium a 
                        hospital operating an approved medical 
                        residency training program for purposes of 
                        enabling the Secretary to calculate the 
                        consortium's payment amount under the project. 
                        Such hospital shall be the hospital where the 
                        resident receives the majority of the 
                        resident's hospital-based, nonambulatory 
                        training experience.
    (d) Allocation of Portion of Medicare GME Payments for Activities 
Under Project.--Notwithstanding any provision of title XVIII of the 
Social Security Act, the following rules apply with respect to each 
State and each health care training consortium participating in the 
demonstration project established under this section during a year:
            (1) In the case of a State--
                    (A) the Secretary shall reduce the amount of each 
                payment made to hospitals in the State during the year 
                for direct graduate medical education costs under 
                section 1886(h) of the Social Security Act by 3 
                percent; and
                    (B) the Secretary shall pay the State an amount 
                equal to the Secretary's estimate of the sum of the 
                reductions made during the year under subparagraph (A) 
                (as adjusted by the Secretary in subsequent years for 
                over- or under-estimations in the amount estimated 
                under this subparagraph in previous years).
            (2) In the case of a consortium--
                    (A) the Secretary shall reduce the amount of each 
                payment made to hospitals who are members of the 
                consortium during the year for direct graduate medical 
                education costs under section 1886(h) of the Social 
                Security Act by 3 percent; and
                    (B) the Secretary shall pay the consortium an 
                amount equal to the Secretary's estimate of the sum of 
                the reductions made during the year under subparagraph 
                (A) (as adjusted by the Secretary in subsequent years 
                for over- or under-estimations in the amount estimated 
                under this subparagraph in previous years).
    (e) Additional Grant for Planning and Evaluation.--
            (1) In general.--The Secretary may award grants to States 
        and consortia participating in the demonstration project under 
        this section for the purpose of developing and evaluating such 
        projects. A State or consortia may conduct such an evaluation 
        or contract with a private entity to conduct the evaluation. 
        Each State and consortia desiring to receive a grant under this 
        paragraph shall prepare and submit to the Secretary an 
        application, at such time, in such manner, and containing such 
        information as the Secretary may require.
            (2) Authorization of appropriations.--There are authorized 
        to be appropriated such sums as may be necessary for grants 
        under this paragraph for fiscal years 1995 through 2000.
    (f) Duration.--A demonstration project under this section shall be 
conducted for a period not to exceed 5 years. The Secretary may 
terminate a project if the Secretary determines that the State or 
consortium conducting the project is not in substantial compliance with 
the terms of the application approved by the Secretary.
    (g) Evaluations and Reports.--
            (1) Evaluations.--Each State or consortium participating in 
        the demonstration project shall submit to the Secretary a final 
        evaluation within 360 days of the termination of the State or 
        consortium's participation and such interim evaluations as the 
        Secretary may require.
            (2) Reports to congress.--Not later than 360 days after the 
        first demonstration project under this subtitle begins, and 
        annually thereafter for each year in which such a project is 
        conducted, the Secretary shall submit a report to Congress 
        which evaluates the effectiveness of the State and consortium 
        activities conducted under such projects and includes any 
        legislative recommendations determined appropriate by the 
        Secretary.
    (h) Maintenance of Effort.--Any funds available for the activities 
covered by a demonstration project under this subtitle shall 
supplement, and shall not supplant, funds that are expended for similar 
purposes under any State, regional, or local program.

SEC. 332. GOALS FOR PROJECTS.

    The goals referred to in this section for a State or consortium 
participating in the demonstration project under this subtitle are as 
follows:
            (1) The training of an equal number of physician and non-
        physician primary care providers.
            (2) The recruiting of residents for graduate medical 
        education training programs who received a portion of 
        undergraduate training in a rural area.
            (3) The allocation of not less than 50 percent of the 
        training spent in a graduate medical residency training program 
        at sites at which acute care inpatient hospital services are 
        not furnished.
            (4) The rotation of residents in approved medical residency 
        training programs among practices that serve residents of rural 
        areas.
            (5) The development of a plan under which, after a 5-year 
        transition period, not less than 50 percent of the residents 
        who begin an initial residency period in an approved medical 
        residency training program shall be primary care residents.

SEC. 333. DEFINITIONS.

    In this subtitle:
            (1) Approved medical residency training program.--The term 
        ``approved medical residency training program'' has the meaning 
        given such term in section 1886(h)(5)(A) of the Social Security 
        Act.
            (2) Health care training consortium.--The term ``health 
        care training consortium'' means a State, regional, or local 
        entity consisting of at least one of each of the following:
                    (A) A hospital operating an approved medical 
                residency training program at which residents receive 
                training at ambulatory training sites located in rural 
                areas.
                    (B) A school of medicine or osteopathic medicine.
                    (C) A school of allied health or a program for the 
                training of physician assistants (as such terms are 
                defined in section 799 of the Public Health Service 
                Act).
                    (D) A school of nursing (as defined in section 853 
                of the Public Health Service Act).
            (3) Primary care.--The term ``primary care'' means family 
        practice, general internal medicine, general pediatrics, and 
        obstetrics and gynecology.
            (4) Resident.--The term ``resident'' has the meaning given 
        such term in section 1886(h)(5)(H) of the Social Security Act.
            (5) Rural area.--The term ``rural area'' has the meaning 
        given such term in section 1886(d)(2)(D) of the Social Security 
        Act.

                 TITLE IV--HOSPITAL ANTITRUST FAIRNESS

SEC. 401. ANTITRUST EXEMPTION.

    The antitrust laws shall not apply with respect to--
            (1) the merger of, or the attempt to merge, 2 or more 
        hospitals,
            (2) a contract entered into solely by 2 or more hospitals 
        to allocate hospital services, or
            (3) the attempt by only 2 or more hospitals to enter into a 
        contract to allocate hospital services,
if each of such hospitals satisfies all of the requirements of section 
503 at the time such hospitals engage in the conduct described in 
paragraph (1), (2), or (3), as the case may be.

SEC. 402. REQUIREMENTS.

    The requirements referred to in section 501 are as follows:
            (1) The hospital is located outside of a city, or in a city 
        that has less than 150,000 inhabitants, as determined in 
        accordance with the most recent data available from the Bureau 
        of the Census.
            (2) In the most recently concluded calendar year, the 
        hospital received more than 40 percent of its gross revenue 
        from payments made under Federal programs.
            (3) There is in effect with respect to the hospital a 
        certificate issued by the Health Care Financing Administration 
        specifying that such Administration has determined that Federal 
        expenditures would be reduced, consumer costs would not 
        increase, and access to health care services would not be 
        reduced, if the hospital and the other hospitals that requested 
        such certificate merge, or allocate the hospital services 
        specified in such request, as the case may be.

SEC. 403. DEFINITION.

    For purposes of this title, the term ``antitrust laws'' has the 
meaning given such term in subsection (a) of the first section of the 
Clayton Act (15 U.S.C. 12), except that such term includes section 5 of 
the Federal Trade Commission Act (15 U.S.C. 45) to the extent that such 
section 5 applies with respect to unfair methods of competition.
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