[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2411 Introduced in House (IH)]







104th CONGRESS
  1st Session
                                H. R. 2411

 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, 
                        and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 27, 1995

Mr. Roberts (for himself, Mr. Stenholm, Mr. Gunderson, and Mr. Poshard) 
 introduced the following bill; which was referred to the Committee on 
 Commerce, and in addition to the Committees on Ways and Means and the 
 Judiciary, for a period to be subsequently determined by the Speaker, 
 in each case for consideration of such provisions as fall within the 
                jurisdiction of the committee concerned

_______________________________________________________________________

                                 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, 
                        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 
Development Act''.
    (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. Study regarding designation as health professional shortage 
                            area; allocation of Corps members among 
                            shortage areas.
Sec. 203. Other provisions regarding National Health Service Corps.
              Subtitle B--Incentives Under Other Programs

Sec. 211. Additional payments under medicare for physicians' services 
                            furnished in shortage areas.
Sec. 212. Development of model State scope of practice law.
           TITLE III--ASSISTANCE FOR INSTITUTIONAL PROVIDERS

          Subtitle A--Hospital-Affiliated Primary Care Centers

Sec. 301. Hospital-affiliated primary care centers.
        Subtitle B--Assistance to Rural Providers Under Medicare

Sec. 311. Establishment of rural emergency access care hospitals.
Sec. 312. Coverage of and payment for services.
Sec. 313. Effective date.
Subtitle C--Demonstration Projects to Encourage Primary Care and Rural-
                    Based Graduate Medical Education

Sec. 321. State and consortium demonstration projects.
Sec. 322. Goals for projects.
Sec. 323. Definitions.
                TITLE IV--MEDICARE PAYMENT METHODOLOGIES

Sec. 401. Telemedicine services.
Sec. 402. HMO-risk contract program.
                  TITLE V--HOSPITAL ANTITRUST FAIRNESS

Sec. 501. Antitrust exemption.
Sec. 502. Requirements.
Sec. 503. Definition.
                          TITLE VI--FINANCING

Sec. 601. Increase in medicare part B premium for individuals with high 
                            income.
Sec. 602. Termination of certain grant programs.

 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 percent 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 percent 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 percent 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 rural 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 the State offices of rural health or through 
appropriate entities designated by such offices.
    (e) Authorization of Appropriations.--There are authorized to be 
appropriated $10,000,000 for each of fiscal years 1996 through 2000 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 for the purpose of providing for the development 
and implementation of community rural health networks (as defined in 
section 104). In providing such assistance, the Secretary shall give 
priority to eligible entities that will carry out such purpose in 
States that have developed a plan under section 101.
    (b) Eligible Entities.--
            (1) In general.--An entity is eligible to receive financial 
        assistance under this section only if the entity meets the 
        requirements of subparagraphs (A) through (C) as follows:
                    (A) The entity--
                            (i) is based in a rural area;
                            (ii) is described in paragraph (2), (3), or 
                        (4) of section 102(b); or
                            (iii) is a hospital-affiliated primary care 
                        center (as defined in section 104).
                    (B) The entity is undertaking to develop and 
                implement a community rural health network in one or 
                more underserved rural areas (as defined in section 
                104) with the active participation of at least 3 health 
                care providers or facilities in the area.
                    (C) The entity 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 1996 through 2000 to 
        carry out this section. Amounts appropriated under this section 
        shall be available until expended.
            (2) 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.

    (a) In General.--
            (1) Community rural health network.--For purposes of this 
        title, 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) Hospital-affiliated primary care center.--
                    (A) In general.--For purposes of this title, the 
                term ``hospital-affiliated primary care center'' means 
                a distinct administrative unit of a community hospital 
                (as defined in subparagraph (B)) meeting the following 
                requirement:
                            (i) The unit is located in, or adjacent to, 
                        the hospital.
                            (ii) The unit delivers primary health 
                        services, as defined in paragraph (1) of 
                        section 330(b) of the Public Health Service Act 
                        to a catchment area determined by the hospital 
                        and approved by the Secretary.
                            (iii) The unit provides referrals to 
                        providers of supplemental health services, as 
                        defined in paragraph (2) of such section.
                            (iv) The services of the unit are delivered 
                        through a primary care group practice (as 
                        defined in subparagraph (C)).
                            (v) To the extent practicable, primary 
                        health services in the community hospital are 
                        delivered only through the unit.
                            (vi) Qualified personnel trained in triage 
                        are placed in the unit, the emergency room, and 
                        the outpatient department to screen and direct 
                        patients to the appropriate location for care.
                            (vii) Each patient of the unit has an 
                        identified member of the group practice 
                        responsible for continuous management of the 
                        patient, including emergency services and 
                        referrals of the patients for inpatient or 
                        outpatient services.
                            (viii) To the extent practicable, excess 
                        facilities and equipment in or owned by the 
                        community hospital are covered for use in the 
                        unit.
                            (ix) The unit and the hospital avoid 
                        unnecessary duplication of facilities and 
                        equipment, except that the unit may install 
                        appropriate support equipment for routine 
                        primary health services.
                            (x) The unit is maintained as a separate 
                        and distinct cost and revenue center for 
                        accounting purposes.
                            (xi) The unit is operated in accordance 
                        with all of the requirements specified for 
                        community health centers in section 330(e)(3) 
                        of the Public Health Service Act (other than 
                        subparagraph (G)).
                            (xii) The hospital has an advisory 
                        committee that--
                                    (I) is composed of individuals a 
                                majority of whom are health consumers 
                                in the catchment area of the hospital; 
                                and
                                    (II) meets at least 6 times a year 
                                to review the operations of the primary 
                                care center and develop recommendations 
                                to the governing board of the hospital 
                                about the operation of the center and 
                                the types of services to be provided.
                            (xiii) The unit maintains an information 
                        program for its patients that fully discloses--
                                    (I) the covered professional 
                                services and referral capabilities 
                                offered by the unit; and
                                    (II) the method by which patients 
                                of the unit may resolve grievances 
                                about billing for covered professional 
                                services and the quality of such 
                                services.
                    (B) Community hospital.--For purposes of this 
                title, the term ``community hospital'' means a public 
                general hospital, owned and operated by a State, county 
                or local unit of government, or a private community 
                hospital that--
                    (A) has less than 50 beds; and
                    (B) primarily serves--
                            (i) a medically underserved population, as 
                        defined in section 330(b)(3) of the Public 
                        Health Service Act; or
                            (ii) a health professional shortage area, 
                        as defined in section 332(a)(1) of such Act.
                    (C) Primary care group practice.--For purposes of 
                this title, the term ``primary care group practice'' 
                means any combination of 3 or more primary care 
                physicians who are--
                            (i) organized to provide primary health 
                        services in a manner that is consistent with 
                        the needs of the population served;
                            (ii) located in, or adjacent to, the 
                        community hospital;
                            (iii) who have admitting privileges at the 
                        community hospital; and
                            (iv)(I) who are salaried by the hospital 
                        such that a majority of the members of the 
                        group practice is full time in the primary care 
                        center; or
                            (II) who are organized into a legal entity 
                        (partnership, corporation, or professional 
                        association) that has a contract approved by 
                        the Secretary with the community hospital to 
                        provide primary health services.
    (b) Other Definitions.--For purposes of this title:
            (1) The term ``rural area'' has the meaning given such term 
        in section 1886(d)(2)(D) of the Social Security Act.
            (2) The term ``Secretary'' means the Secretary of Health 
        and Human Services.
            (3) 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.
            (4) 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. STUDY REGARDING DESIGNATION AS HEALTH PROFESSIONAL SHORTAGE 
              AREA; ALLOCATION OF CORPS MEMBERS AMONG SHORTAGE AREAS.

    (a) In General.--The Secretary of Health and Human Services (in 
this section referred to as the ``Secretary'') shall conduct a study 
for the purpose of determining the following:
            (1) With respect to the designation of health professional 
        shortage areas under subpart II of part D of title III of the 
        Public Health Service Act--
                    (A) whether the statutory and administrative 
                criteria for the designation of such areas should be 
                modified to ensure that all areas with significant 
                shortages of health professionals receive such a 
                designation; and
                    (B) if so, the recommendations of the Secretary for 
                modifications in the criteria.
            (2) With respect to the assignment of members of the 
        National Health Service Corps under such subpart--
                    (A) whether the statutory and administrative 
                criteria for the assignment of Corps members should be 
                modified in order to ensure that the members are 
                equitably allocated among health professional shortage 
                areas; and
                    (B) if so, the recommendations of the Secretary for 
                modifications in the criteria.
    (b) Report.--Not later than May 1, 1996, the Secretary shall 
complete the study required in subsection (a) and submit to the 
Congress a report describing the findings made in the study.

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

    (a) Priority in Assignment of Corps Members; Community Rural Health 
Networks.--Section 333A(a)(1)(B) of the Public Health Service Act (42 
U.S.C. 254f-1(a)(1)(B)) is amended--
            (1) in clause (iii), by striking ``and'' after the 
        semicolon at the end;
            (2) in clause (iv), by adding ``and'' after the semicolon 
        at the end; and
            (3) by adding at the end the following clause:
                            ``(v) is a participant in a community rural 
                        health network, as defined in section 104 of 
                        the Rural Health Development Act.''.
    (b) 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 1996 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.''.

              Subtitle B--Incentives Under Other Programs

SEC. 211. ADDITIONAL PAYMENTS UNDER MEDICARE FOR PHYSICIANS' SERVICES 
              FURNISHED IN SHORTAGE AREAS.

    (a) Increase in Amount of Additional Payment.--Section 1833(m) of 
the Social Security Act (42 U.S.C. 1395l(m)) is amended by striking 
``10 percent'' and inserting ``20 percent''.
    (b) Restriction to Primary Care Services.--Section 1833(m) of such 
Act (42 U.S.C. 1395l(m)) is amended by inserting after ``physicians' 
services'' the following: ``consisting of primary care services (as 
defined in section 1842(i)(4))''.
    (c) Extension of Payment for Former Shortage Areas.--
            (1) 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),''.
            (2) Effective date.--The amendment made by paragraph (1) 
        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, 1996.
    (d) Requiring Carriers to Report on Services Provided.--Section 
1842(b)(3) of such Act (42 U.S.C. 1395u(b)(3)) is amended--
            (1) by striking ``and'' at the end of subparagraph (I); and
            (2) by inserting after subparagraph (I) the following new 
        subparagraph:
            ``(J) will provide information to the Secretary not later 
        than 30 days after the end of the contract year on the types of 
        providers to whom the carrier made additional payments during 
        the year for certain physicians' services pursuant to section 
        1833(m), together with a description of the services furnished 
        by such providers during the year; and''.
    (e) Study.--
            (1) In general.--The Secretary of Health and Human Services 
        shall conduct a study analyzing the effectiveness of the 
        provision of additional payments under part B of the medicare 
        program for physicians' services provided in health 
        professional shortage areas in recruiting and retaining 
        physicians to provide services in such areas.
            (2) Report.--Not later than 1 year after the date of the 
        enactment of this Act, the Secretary shall submit to Congress a 
        report on the study conducted under paragraph (1), and shall 
        include in the report such recommendations as the Secretary 
        considers appropriate.
    (f) Effective Date.--The amendments made by subsections (a), (b), 
and (d) shall apply to physicians' services furnished on or after 
January 1, 1996.

SEC. 212. 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--Hospital-Affiliated Primary Care Centers

SEC. 301. HOSPITAL-AFFILIATED PRIMARY CARE CENTERS.

    Section 330 of the Public Health Service Act (42 U.S.C. 254c) is 
amended by adding at the end the following subsection:
    ``(l) Of the amounts appropriated under subsection (g)(1)(A) for a 
fiscal year, the Secretary shall reserve not less than 10 percent, and 
not more than 20 percent, for the establishment and operation of 
hospital-affiliated primary care centers, as defined in section 104 of 
the Rural Health Development Act.''.

        Subtitle B--Assistance to Rural Providers Under Medicare

SEC. 311. ESTABLISHMENT OF RURAL EMERGENCY ACCESS CARE HOSPITALS.

    (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 is a member of a community rural health 
        network under section 104 of the Rural Health Development Act.
            ``(H) 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.
            ``(I) 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)).
    ``(3) The term `inpatient rural emergency access care hospital 
services' means services described in paragraph (2), furnished to an 
individual over a continuous period not to exceed 24 hours (except that 
such services may be furnished over a longer period in the case of an 
individual who is unable to leave the hospital because of inclement 
weather) that would be inpatient hospital services if furnished to an 
inpatient of a hospital by a hospital.''.
    (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. 312. COVERAGE OF AND PAYMENT FOR SERVICES.

    (a) Under Part A.--
            (1) Coverage.--Section 1812(a)(1) of the Social Security 
        Act (42 U.S.C. 1395d(a)(1)) is amended by striking ``or 
        inpatient rural primary care hospital services'' and inserting 
        ``inpatient rural primary care hospital services, or inpatient 
        rural emergency access care hospital services''.
            (2) Application of deductible and coinsurance.--(A) 
        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 
        ``services or inpatient rural primary care hospital services'' 
        each place it appears and inserting ``services, inpatient rural 
        primary care hospital services, or inpatient rural emergency 
        access care hospital services''.
            (B) Section 1813(b)(3)(B) of such Act (42 U.S.C. 
        1395e(b)(3)(B)) is amended by inserting ``, inpatient rural 
        emergency access care hospital services,'' after ``inpatient 
        rural primary care hospital services''.
            (3) Payment based on reasonable costs.--Section 1814 of 
        such Act (42 U.S.C. 1395f) is amended by adding at the end the 
        following new subsection:

 ``Payment for Inpatient Rural Emergency Access Care Hospital Services

    ``(m) The amount of payment under this part for inpatient rural 
primary care hospital services shall be equal to the reasonable cost of 
such services (as determined under section 1861(v)), less the amount 
the hospital may charge as described in clause (ii) of section 
1866(a)(2)(A), but in no case may the payment for such services exceed 
80 percent of such reasonable cost.''.
            (4) Application of spell of illness.--Section 1861(a) of 
        such Act (42 U.S.C. 1395x(a)) is amended--
                    (A) in paragraph (1), by inserting ``, inpatient 
                rural emergency access care hospital services,'' after 
                ``inpatient rural primary care hospital services''; and
                    (B) in paragraph (2), by striking ``hospital or 
                rural primary care hospital'' and inserting ``hospital, 
                rural primary care hospital, or rural emergency access 
                care hospital''.
    (b) Under Part B.--
            (1) Coverage.--Section 1832(a)(2) of the Social Security 
        Act (42 U.S.C. 1395k(a)(2)) is amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (I);
                    (B) by striking the period at the end of 
                subparagraph (J) and inserting ``; and''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(K) rural emergency access care hospital services 
                (as defined in section 1861(oo)(2)).''.
            (2) Payment based on reasonable costs.--Section 1833(a)(2) 
        of such Act (42 U.S.C. 1395l(a)(2)) is amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (D);
                    (B) by adding ``and'' at the end of subparagraph 
                (F); and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(G) with respect to rural emergency access care 
                hospital services, the reasonable cost of such services 
                (as determined under section 1861(v)), less the amount 
                the hospital may charge as described in clause (ii) of 
                section 1866(a)(2)(A), but in no case may the payment 
                for such services exceed 80 percent of such reasonable 
                cost;''.

SEC. 313. EFFECTIVE DATE.

    The amendments made by this subtitle shall apply to fiscal years 
beginning on or after October 1, 1995.

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

SEC. 321. 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 322; 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 322. 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 planning and evaluating such 
        projects. A State or consortia may conduct such planning and 
        evaluation activities or contract with a private entity to 
        conduct such activities. 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 for grants under this paragraph $250,000 for 
        fiscal year 1996, and $100,000 for each of the fiscal years 
        1997 through 2001.
    (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. 322. 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. 323. 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--MEDICARE PAYMENT METHODOLOGIES

SEC. 401. TELEMEDICINE SERVICES.

    The Secretary of Health and Human Services shall establish a 
methodology for making payments under part B of the medicare program 
for telemedicine services furnished on an emergency basis to 
individuals residing in an area designated as a health professional 
shortage area (under section 332(a) of the Public Health Service Act).

SEC. 402. HMO-RISK CONTRACT PROGRAM.

    (a) Use of Single National Average Per Capita Costs for 
Organizations in All Geographic Areas.--
            (1) In general.--Section 1876(a)(4) of the Social Security 
        Act (42 U.S.C. 1395mm(a)(4)) is amended by striking ``in a 
        geographic area served by an eligible organization or in a 
        similar area,'' and inserting ``for all areas in the United 
        States served by eligible organizations with contracts under 
        this section''.
            (2) Effective date.--The amendment made by subsection (a) 
        shall apply with respect to contract years beginning with 1996.
    (b) Budget Neutrality.--The Secretary shall adjust the amount of 
payment made to eligible organizations with a risk-sharing contract 
under section 1876 of the Social Security Act for 1997 and subsequent 
years to ensure that total payments to such organizations under such 
section for the year do not exceed the amount which would have been 
paid to such organizations during the year if the amendment made by 
subsection (a) had not been enacted into law.

                  TITLE V--HOSPITAL ANTITRUST FAIRNESS

SEC. 501. 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 
502 at the time such hospitals engage in the conduct described in 
paragraph (1), (2), or (3), as the case may be.

SEC. 502. 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. 503. 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.

                          TITLE VI--FINANCING

SEC. 601. INCREASE IN MEDICARE PART B PREMIUM FOR INDIVIDUALS WITH HIGH 
              INCOME.

    (a) In General.--Subchapter A of chapter 1 of the Internal Revenue 
Code of 1986 is amended by adding at the end thereof the following new 
part:

   ``PART VIII--MEDICARE PART B PREMIUMS FOR HIGH-INCOME INDIVIDUALS

                              ``Sec. 59B. Medicare part B premium tax.

``SEC. 59B. MEDICARE PART B PREMIUM TAX.

    ``(a) Imposition of Tax.--In the case of an individual to whom this 
section applies for the taxable year, there is hereby imposed (in 
addition to any other tax imposed by this subtitle) a tax for such 
taxable year equal to the aggregate of the Medicare part B premium 
taxes for each of the months during such year that such individual is 
covered by Medicare part B.
    ``(b) Individuals to Whom Section Applies.--This section shall 
apply to any individual for any taxable year if--
            ``(1) such individual is covered under Medicare part B for 
        any month during such year, and
            ``(2) the modified adjusted gross income of the taxpayer 
        for such taxable year exceeds the threshold amount.
    ``(c) Medicare Part B Premium Tax for Month.--
            ``(1) In general.--The Medicare part B premium tax for any 
        month is \2/3\ the amount equal to the excess of--
                    ``(A) 200 percent of the monthly actuarial rate for 
                enrollees age 65 and over determined for that calendar 
                year under section 1839(b) of the Social Security Act, 
                over
                    ``(B) the total monthly premium under section 1839 
                of the Social Security Act (determined without regard 
                to subsections (b) and (f) of section 1839 of such 
                Act).
            ``(2) Phasein of tax.--If the modified adjusted gross 
        income of the taxpayer for any taxable years exceeds the 
        threshold amount by less than $25,000, the Medicare part B 
        premium tax for any month during such taxable year shall be an 
        amount which bears the same ratio to the amount determined 
        under paragraph (1) (without regard to this paragraph) as such 
        excess bears to $25,000. The preceding sentence shall not apply 
        to any individual whose threshold amount is zero.
    ``(d) Other Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Threshold amount.--The term `threshold amount' 
        means--
                    ``(A) except as otherwise provided in this 
                paragraph, $100,000,
                    ``(B) $125,000 in the case of a joint return, and
                    ``(C) zero in the case of a taxpayer who--
                            ``(i) is married at the close of the 
                        taxable year but does not file a joint return 
                        for such year, and
                            ``(ii) does not live apart from his spouse 
                        at all times during the taxable year.
            ``(2) Modified adjusted gross income.--The term `modified 
        adjusted gross income' means adjusted gross income--
                    ``(A) determined without regard to sections 135, 
                911, 931, and 933, and
                    ``(B) increased by the amount of interest received 
                or accrued by the taxpayer during the taxable year 
                which is exempt from tax.
            ``(3) Medicare part b coverage.--An individual shall be 
        treated as covered under Medicare part B for any month if a 
        premium is paid under part B of title XVIII of the Social 
        Security Act for the coverage of the individual under such part 
        for the month.
            ``(4) Married individual.--The determination of whether an 
        individual is married shall be made in accordance with section 
        7703.''
    (b) Clerical Amendment.--The table of parts for subchapter A of 
chapter 1 of such Code is amended by adding at the end thereof the 
following new item:

                              ``Part VIII. Medicare Part B Premiums For 
                                        High-Income Individuals.''
    (c) Effective Date.--The amendments made by this section shall 
apply to months after December 1995 in taxable years ending after 
December 31, 1995.

SEC. 602. TERMINATION OF CERTAIN GRANT PROGRAMS.

    Notwithstanding any other provision of law, no funds are authorized 
to be appropriated to carry out the following programs for fiscal year 
1996 or any subsequent fiscal year:
                    (A) The grant program for rural health transition 
                under section 4005(e) of the Omnibus Budget 
                Reconciliation Act of 1987.
                    (B) The program for rural outreach grants (which 
                program was, for fiscal year 1995, carried out by the 
                Health Resources and Services Administration with funds 
                made available under Public Law 103-333 for such 
                grants).
                    (C) The telemedicine grant program (which program 
                was, for fiscal year 1995, carried out by the Health 
                Resources and Services Administration with funds made 
                available under Public Law 103-333 for rural health 
                research).
                    (D) The program under section 338J of the Public 
                Health Service Act (relating to State offices of rural 
                health).
                    (E) The programs under parts A through C of title 
                XII of the Public Health Service Act (relating to 
                trauma care).
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