[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 963 Introduced in Senate (IS)]







104th CONGRESS
  1st Session
                                 S. 963

To amend the medicare program under title XVIII of the Social Security 
     Act to improve rural health services, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                June 23 (legislative day, June 19), 1995

Mr. Baucus (for himself, Mr. Grassley, and Mr. Rockefeller) introduced 
the following bill; which was read twice and referred to the Committee 
                               on Finance

_______________________________________________________________________

                                 A BILL


 
To amend the medicare program under title XVIII of the Social Security 
     Act to improve rural health services, and for other purposes.
    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Rural Health Improvement Act of 
1995''.
SEC. 2. MEDICARE RURAL HOSPITAL FLEXIBILITY PROGRAM.

    (a) Findings and Purpose.--
            (1) Findings.--The Congress finds the following:
                    (A) One-quarter of the United States population, or 
                about 65 million persons, reside in rural areas. Rural 
                areas have a larger proportion of elderly residents. 
                Rural populations have a higher infant mortality rate, 
                and a 40 percent higher rate of death from accidents.
                    (B) Rural hospitals are forced to comply with 
                burdensome and inflexible medicare requirements that do 
                not fit the realities of the rural environment.
                    (C) Rural hospitals are inadequately reimbursed by 
                the medicare program.
                    (D) Inadequate medicare reimbursement and 
                burdensome and inflexible requirements contribute to 
                the high closure rate among rural hospitals, resulting 
                in reduced access to primary care and emergency 
                services for millions of rural residents.
                    (E) Medical assistance facilities have been 
                operating in Montana since 1990 and rural primary care 
                hospitals have been operating since 1993. Both programs 
                help rural hospitals adapt to the changing health care 
                needs of the local community.
                    (F) The Inspector General of the Department of 
                Health and Human Services has found that medical 
                assistance facilities--
                            (i) provide access to health care in remote 
                        rural areas; and
                            (ii) are cost efficient.
                    (G) The Inspector General of the Department of 
                Health and Human Services found that flexible medicare 
                requirements are key to the success of medical 
                assistance facilities.
                    (H) Twenty-one states applied to the Essential 
                Access Hospital (EACH) program authorized in the 
                Omnibus Budget Reconciliation Act of 1989. Seven 
                states, West Virginia, California, Colorado, Kansas, 
                New York, North Carolina, and South Dakota were awarded 
                grants. Eleven hospitals have been designated rural 
                primary care hospitals since final Federal regulations 
                became effective in 1993.
                    (I) Medical assistance facilities and rural primary 
                care hospitals promote the development of rural health 
                care networks and result in increased access for rural 
                residents to a variety of health care services.
            (2) Purpose.--The purpose of this section is to establish 
        the medicare rural hospital flexibility program and to allow 
        all States to develop critical access hospitals.
    (b) Medicare Rural Hospital Flexibility Program.--Section 1820 of 
the Social Security Act (42 U.S.C. 1395i-4) is amended to read as 
follows:

             ``medicare rural hospital flexibility program

    ``Sec. 1820. (a) Purpose.--The purpose of this section is to--
            ``(1) ensure access to health care services for rural 
        communities by allowing hospitals to be designated as critical 
        access hospitals if such hospitals limit the scope of available 
        inpatient acute care services;
            ``(2) provide more appropriate and flexible staffing and 
        licensure standards;
            ``(3) enhance the financial security of critical access 
        hospitals by requiring that medicare reimburse such facilities 
        on a reasonable cost basis; and
            ``(4) promote linkages between critical access hospitals 
        designated by the State under this section and broader programs 
        supporting the development of and transition to integrated 
        provider networks.
    ``(b) Establishment.--Any State that submits an application in 
accordance with subsection (c) may establish a medicare rural hospital 
flexibility program described in subsection (d).
    ``(c) Application.--A State may establish a medicare rural hospital 
flexibility program described in subsection (d) if the State submits to 
the Secretary at such time and in such form as the Secretary may 
require an application containing--
            ``(1) assurances that the State--
                    ``(A) has developed, or is in the process of 
                developing, a State rural health care plan that--
                            ``(i) provides for the creation of one or 
                        more rural health networks (as defined in 
                        subsection (e)) in the State,
                            ``(ii) promotes regionalization of rural 
                        health services in the State, and
                            ``(iii) improves access to hospital and 
                        other health services for rural residents of 
                        the State;
                    ``(B) has developed the rural health care plan 
                described in subparagraph (A) in consultation with the 
                hospital association of the State, rural hospitals 
                located in the State, and the State Office of Rural 
                Health (or, in the case of a State in the process of 
                developing such plan, that assures the Secretary that 
                the State will consult with its State hospital 
                association, rural hospitals located in the State, and 
                the State Office of Rural Health in developing such 
                plan);
            ``(2) assurances that the State has designated (consistent 
        with the rural health care plan described in paragraph (1)(A)), 
        or is in the process of so designating, rural nonprofit or 
        public hospitals or facilities located in the State as critical 
        access hospitals; and
            ``(3) such other information and assurances as the 
        Secretary may require.
    ``(d) Medicare Rural Hospital Flexibility Program Described.--
            ``(1) In general.--A State that has submitted an 
        application in accordance with subsection (c), may establish a 
        medicare rural hospital flexibility program that provides 
        that--
                    ``(A) the State shall develop at least one rural 
                health network (as defined in subsection (e)) in the 
                State; and
                    ``(B) at least one facility in the State shall be 
                designated as a critical access hospital in accordance 
                with paragraph (2).
            ``(2) State designation of facilities.--
                    ``(A) In general.--A State may designate one or 
                more facilities as a critical access hospital in 
                accordance with subparagraph (B).
                    ``(B) Criteria for designation as critical access 
                hospital.--A State may designate a facility as a 
                critical access hospital if the facility--
                            ``(i) is located in a county (or equivalent 
                        unit of local government) in a rural area (as 
                        defined in section 1886(d)(2)(D)) that--
                                    ``(I) is located more than a 35-
                                mile drive from a hospital, or another 
                                facility described in this subsection, 
                                or
                                    ``(II) is certified by the State as 
                                being a necessary provider of health 
                                care services to residents in the area; 
                                and
                            ``(ii) makes available 24-hour emergency 
                        care services that a State determines are 
                        necessary for ensuring access to emergency care 
                        services in each area served by a critical 
                        access hospital;
                            ``(iii) provides not more than 15 acute 
                        care inpatient beds (meeting such standards as 
                        the Secretary may establish) for providing 
                        inpatient care for a period not to exceed 96 
                        hours (unless a longer period is required 
                        because transfer to a hospital is precluded 
                        because of inclement weather or other emergency 
                        conditions), except that a peer review 
                        organization or equivalent entity may, on 
                        request, waive the 96-hour restriction on a 
                        case-by-case basis;
                            ``(iv) 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 and fully staffed, except 
                                insofar as the facility is required to 
                                make available emergency care services 
                                as determined under clause (ii) and 
                                must have nursing services available on 
                                a 24-hour basis, but need not otherwise 
                                staff the facility except when an 
                                inpatient is present,
                                    ``(II) the facility may provide any 
                                services otherwise required to be 
                                provided by a full-time, on site 
                                dietician, pharmacist, laboratory 
                                technician, medical technologist, and 
                                radiological technologist on a part-
                                time, off site basis under arrangements 
                                as defined in section 1861(w)(1), and
                                    ``(III) the inpatient care 
                                described in clause (iii) may be 
                                provided by a physician's assistant, 
                                nurse practitioner, or clinical nurse 
                                specialist subject to the oversight of 
                                a physician who need not be present in 
                                the facility; and
                            ``(v) meets the requirements of 
                        subparagraph (I) of paragraph (2) of section 
                        1861(aa).
    ``(e) Rural Health Network Defined.--
            ``(1) In general.--For purposes of this section, the term 
        `rural health network' means, with respect to a State, an 
        organization consisting of--
                    ``(A) at least 1 facility that the State has 
                designated or plans to designate as a critical access 
                hospital, and
                    ``(B) at least 1 hospital that furnishes acute care 
                services.
            ``(2) Agreements.--
                    ``(A) In general.--Each critical access hospital 
                that is a member of a rural health network shall have 
                an agreement with respect to each item described in 
                subparagraph (B) with at least 1 hospital that is a 
                member of the network.
                    ``(B) Items described.--The items described in this 
                subparagraph are the following:
                            ``(i) Patient referral and transfer.
                            ``(ii) The development and use of 
                        communications systems including (where 
                        feasible)--
                                    ``(I) telemetry systems, and
                                    ``(II) systems for electronic 
                                sharing of patient data.
                            ``(iii) The provision of emergency and non-
                        emergency transportation among the facility and 
                        the hospital.
                    ``(C) Credentialing and quality assurance.--Each 
                critical access hospital that is a member of a rural 
                health network shall have an agreement with respect to 
                credentialing and quality assurance with at least 1--
                            ``(i) hospital that is a member of the 
                        network;
                            ``(ii) peer review organization or 
                        equivalent entity; or
                            ``(iii) other appropriate and qualified 
                        entity identified in the State rural health 
                        care plan.
    ``(f) Certification by the Secretary.--The Secretary shall certify 
a facility as a critical access hospital if the facility--
            ``(1) is located in a State that has established a medicare 
        rural hospital flexibility program in accordance with 
        subsection (d);
            ``(2) is designated as a critical access hospital by the 
        State in which it is located; and
            ``(3) meets such other criteria as the Secretary may 
        require.
    ``(g) Permitting Maintenance of Swing Beds.--Nothing in this 
section shall be construed to prohibit a State from designating or the 
Secretary from certifying a facility as a critical access hospital 
solely because, at the time the facility applies to the State for 
designation as a critical access 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 in the facility pursuant to subsection 
(d)(2)(A)(iii)). 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 critical access hospital.
    ``(h) Grants.--
            ``(1) Medicare rural hospital flexibility program.--The 
        Secretary may award grants to States that have submitted 
        applications in accordance with subsection (c) for--
                    ``(A) engaging in activities relating to planning 
                and implementing a rural health care plan;
                    ``(B) engaging in activities relating to planning 
                and implementing rural health networks; and
                    ``(C) designating facilities as critical access 
                hospitals.
            ``(2) Rural emergency medical services.--
                    ``(A) In general.--The Secretary may award grants 
                to States that have submitted applications in 
                accordance with subparagraph (B) for the establishment 
                or expansion of a program for the provision of rural 
                emergency medical services.
                    ``(B) Application.--An application is in accordance 
                with this subparagraph if the State submits to the 
                Secretary at such time and in such form as the 
                Secretary may require an application containing the 
                assurances described in subparagraphs (A)(ii), 
                (A)(iii), and (B) of subsection (c)(1) and paragraph 
                (3) of such subsection.
    ``(i) Grandfathering of Certain Facilities.--
            ``(1) In general.--Any medical assistance facility 
        operating in Montana and any rural primary care hospital 
        designated by the Secretary under this section prior to the 
        date of the enactment of the Rural Health Improvement Act of 
        1995 shall be deemed to have been certified by the Secretary 
        under subsection (f) as a critical access hospital if such 
        facility or hospital is otherwise eligible to be designated by 
        the State as a critical access hospital under subsection (d).
            ``(2) Continuation of medical assistance facility and rural 
        primary care hospital terms.--Notwithstanding any other 
        provision of this title, with respect to any medical assistance 
        facility or rural primary care hospital described in paragraph 
        (1), any reference in this title to a `critical access 
        hospital' shall be deemed to be a reference to a `medical 
        assistance facility' or `rural primary care hospital'.
    ``(j) Waiver of Conflicting Part A Provisions.--The Secretary is 
authorized to waive such provisions of this part and part C as are 
necessary to conduct the program established under this section.
    ``(k) Authorization of Appropriations.--There are authorized to be 
appropriated from the Federal Hospital Insurance Trust Fund for making 
grants to all States under subsection (h), $25,000,000 in each of the 
fiscal years 1996 through 2000.''.
    (c) Report on Alternative to 96-Hour Rule.--Not later than January 
1, 1996, the Administrator of the Health Care Financing Administration 
shall submit to the Congress a report on the feasibility of, and 
administrative requirements necessary to establish an alternative for 
certain medical diagnoses (as determined by the Administrator) to the 
96-hour limitation for inpatient care in critical access hospitals 
required by section 1820(d)(2)(B)(iii).
    (d) Part A Amendments Relating to Rural Primary Care Hospitals and 
Critical Access Hospitals.--
            (1) Definitions.--Section 1861(mm) of the Social Security 
        Act (42 U.S.C. 1395x(mm)) is amended to read as follows:

     ``critical access hospital; critical access hospital services

    ``(mm)(1) The term `critical access hospital' means a facility 
certified by the Secretary as a critical access hospital under section 
1820(f).
    ``(2) The term `inpatient critical access hospital services' means 
items and services, furnished to an inpatient of a critical access 
hospital by such facility, that would be inpatient hospital services if 
furnished to an inpatient of a hospital by a hospital.''.
            (2) Coverage and payment.--(A) Section 1812(a)(1) of such 
        Act (42 U.S.C. 1395d(a)(1)) is amended by striking ``or 
        inpatient rural primary care hospital services'' and inserting 
        ``or inpatient critical access hospital services''.
            (B) Section 1814 of such Act (42 U.S.C. 1395f) is amended--
                    (i) on subsection (a)(8)--
                            (I) by striking ``rural primary care 
                        hospital'' each place it appears and inserting 
                        ``critical access hospital''; and
                            (II) by striking ``72'' and inserting 
                        ``96'';
                    (ii) in subsection (b), by striking ``other than a 
                rural primary care hospital providing inpatient rural 
                primary care hospital services,'' and inserting ``other 
                than a critical access hospital providing inpatient 
                critical access hospital services,''; and
                    (iii) by amending subsection (l) to read as 
                follows:
    ``(l) Payment for Inpatient Critical Access Hospital Services.--The 
amount of payment under this part for inpatient critical access 
hospital services is the reasonable costs of the critical access 
hospital in providing such services.''.
            (3) Treatment of critical access hospitals as providers of 
        services.--(A) Section 1861(u) of such Act (42 U.S.C. 1395x(u)) 
        is amended by striking ``rural primary care hospital'' and 
        inserting ``critical access hospital''.
            (B) The first sentence of section 1864(a) of such Act (42 
        U.S.C. 1395aa(a)) is amended by striking ``a rural primary care 
        hospital'' and inserting ``a critical access hospital''.
            (4) Conforming amendments.--(A) Section 1128A(b)(1) of such 
        Act (42 U.S.C. 1320a-7a(b)(1)) is amended by striking ``rural 
        primary care hospital'' each place it appears and inserting 
        ``critical access hospital''.
            (B) Section 1128B(c) of such Act (42 U.S.C. 1320a-7b(c)) is 
        amended by striking ``rural primary care hospital'' and 
        inserting ``critical access hospital''.
            (C) Section 1134 of such Act (42 U.S.C. 1320b-4) is amended 
        by striking ``rural primary care hospitals'' each place it 
        appears and inserting ``critical access hospitals''.
            (D) Section 1138(a)(1) of such Act (42 U.S.C. 1320b-
        8(a)(1)) is amended--
                    (i) in the matter preceding subparagraph (A), by 
                striking ``rural primary care hospital'' and inserting 
                ``critical access hospital''; and
                    (ii) in the matter preceding clause (i) of 
                subparagraph (A), by striking ``rural primary care 
                hospital'' and inserting ``critical access hospital''.
            (E) Section 1816(c)(2)(C) of such Act (42 U.S.C. 
        1395h(c)(2)(C)) is amended by striking ``rural primary care 
        hospital'' and inserting ``critical access hospital''.
            (F) Section 1833 of such Act (42 U.S.C. 1395l) is amended--
                    (i) in subsection (h)(5)(A)(iii), by striking 
                ``rural primary care hospital'' and inserting 
                ``critical access hospital'';
                    (ii) in subsection (i)(1)(A), by striking ``rural 
                primary care hospital'' and inserting ``critical access 
                hospital'';
                    (iii) in subsection (i)(3)(A), by striking ``rural 
                primary care hospital services'' and inserting 
                ``critical access hospital services'';
                    (iv) in subsection (l)(5)(A), by striking ``rural 
                primary care hospital'' each place it appears and 
                inserting ``critical access hospital''; and
                    (v) in subsection (l)(5)(B), by striking ``rural 
                primary care hospital'' each place it appears and 
                inserting ``critical access hospital''.
            (G) Section 1835(c) of such Act (42 U.S.C. 1395n(c)) is 
        amended by striking ``rural primary care hospital'' each place 
        it appears and inserting ``critical access hospital''.
            (H) Section 1842(b)(6)(A)(ii) of such Act (42 U.S.C. 
        1395u(b)(6)(A)(ii)) is amended by striking ``rural primary care 
        hospital'' and inserting ``critical access hospital''.
            (I) Section 1861 of such Act (42 U.S.C. 1395x) is amended--
                    (i) in the last sentence of subsection (e), by 
                striking ``rural primary care hospital'' and inserting 
                ``critical access hospital'';
                    (ii) in subsection (v)(1)(S)(ii)(III), by striking 
                ``rural primary care hospital'' and inserting 
                ``critical access hospital'';
                    (iii) in subsection (w)(1), by striking ``rural 
                primary care hospital'' and inserting ``critical access 
                hospital''; and
                    (iv) in subsection (w)(2), by striking ``rural 
                primary care hospital'' each place it appears and 
                inserting ``critical access hospital''.
            (J) Section 1862(a)(14) of such Act (42 U.S.C. 
        1395y(a)(14)) is amended by striking ``rural primary care 
        hospital'' each place it appears and inserting ``critical 
        access hospital''.
            (K) Section 1866(a)(1) of such Act (42 U.S.C 1395cc(a)(1)) 
        is amended--
                    (i) in subparagraph (F)(ii), by striking ``rural 
                primary care hospitals'' and inserting ``critical 
                access hospitals'';
                    (ii) in subparagraph (H), in the matter preceding 
                clause (i), by striking ``rural primary care 
                hospitals'' and ``rural primary care hospital 
                services'' and inserting ``critical access hospitals'' 
                and ``critical access hospital services'', 
                respectively;
                    (iii) in subparagraph (I), in the matter preceding 
                clause (i), by striking ``rural primary care hospital'' 
                and inserting ``critical access hospital''; and
                    (iv) in subparagraph (N)--
                            (I) in the matter preceding clause (i), by 
                        striking ``rural primary hospitals'' and 
                        inserting ``critical access hospitals'', and
                            (II) in clause (i), by striking ``rural 
                        primary care hospital'' and inserting 
                        ``critical access hospital''.
            (L) Section 1866(a)(3) of such Act (42 U.S.C 1395cc(a)(3)) 
        is amended--
                    (i) by striking ``rural primary care hospital'' 
                each place it appears in subparagraphs (A) and (B) and 
                inserting ``critical access hospital''; and
                    (ii) in subparagraph (C)(ii)(II), by striking 
                ``rural primary care hospitals'' each place it appears 
                and inserting ``critical access hospitals''.
            (M) Section 1867(e)(5) of such Act (42 U.S.C. 1395dd(e)(5)) 
        is amended by striking ``rural primary care hospital'' and 
        inserting ``critical access hospital''.
    (e) Payment Continued to Designated EACHs.--Section 1886(d)(5)(D) 
of such Act (42 U.S.C. 1395ww(d)(5)(D)) is amended--
            (1) in clause (iii)(III), by inserting ``as in effect on 
        September 30, 1995'' before the period at the end; and
            (2) in clause (v)--
                    (A) by inserting ``as in effect on September 30, 
                1995'' after ``1820(i)(1)''; and
                    (B) by striking ``1820(g)'' and inserting 
                ``1820(e)''.
    (f) Part B Amendments Relating to Critical Access Hospitals.--
            (1) Coverage.--(A) Section 1861(mm) of the Social Security 
        Act (42 U.S.C. 1395x(mm)) as amended by subsection (d)(1), is 
        amended by adding at the end the following new paragraph:
    ``(3) The term `outpatient critical access hospital services' means 
medical and other health services furnished by a critical access 
hospital on an outpatient basis.''.
            (B) Section 1832(a)(2)(H) of such Act (42 U.S.C. 
        1395k(a)(2)(H)) is amended by striking ``rural primary care 
        hospital services'' and inserting ``critical access hospital 
        services''.
            (2) Payment.--(A) Section 1833(a) of such Act (42 U.S.C. 
        1395l(a)) is amended in paragraph (6), by striking ``outpatient 
        rural primary care hospital services'' and inserting 
        ``outpatient critical access services''.
            (B) Section 1834(g) of such Act (42 U.S.C. 1395m(g)) is 
        amended to read as follows:
    ``(g) Payment for Outpatient Critical Access Hospital Services.--
The amount of payment under this part for outpatient critical access 
hospital services is the reasonable costs of the critical access 
hospital in providing such services.''.
    (g) Effective Date.--The amendments made by this section shall 
apply to services furnished on or after October 1, 1995.

SEC. 3. OFFICE OF RURAL HEALTH POLICY.

    (a) Appointment of Assistant Secretary.--
            (1) In general.--Section 711(a) of the Social Security Act 
        (42 U.S.C. 912(a)) is amended--
                    (A) by striking ``by a Director, who shall advise 
                the Secretary'' and inserting ``by an Assistant 
                Secretary for Rural Health (in this section referred to 
                as the `Assistant Secretary'), who shall report 
                directly to the Secretary''; and
                    (B) by adding at the end the following new 
                sentence: ``The Office shall not be a component of any 
                other office, service, or component of the 
                Department.''.
            (2) Conforming amendments.--(A) Section 711(b) of the 
        Social Security Act (42 U.S.C. 912(b)) is amended by striking 
        ``the Director'' and inserting ``the Assistant Secretary''.
            (B) Section 338J(a) of the Public Health Service Act (42 
        U.S.C. 254r(a)) is amended by striking ``Director of the Office 
        of Rural Health Policy'' and inserting ``Assistant Secretary 
        for Rural Health''.
            (C) Section 464T(b) of the Public Health Service Act (42 
        U.S.C. 285p-2(b)) is amended in the matter preceding paragraph 
        (1) by striking ``Director of the Office of Rural Health 
        Policy'' and inserting ``Assistant Secretary for Rural 
        Health''.
            (D) Section 6213 of the Omnibus Budget Reconciliation Act 
        of 1989 (42 U.S.C. 1395x note) is amended in subsection (e)(1) 
        by striking ``Director of the Office of Rural Health Policy'' 
        and inserting ``Assistant Secretary for Rural Health''.
            (E) Section 403 of the Ryan White Comprehensive AIDS 
        Resources Emergency Act of 1990 (42 U.S.C. 300ff-11 note) is 
        amended in the matter preceding paragraph (1) of subsection (a) 
        by striking ``Director of the Office of Rural Health Policy'' 
        and inserting ``Assistant Secretary for Rural Health''.
            (3) Amendment to the executive schedule.--Section 5315 of 
        title 5, United States Code, is amended by striking ``Assistant 
        Secretaries of Health and Human Services (6)'' and inserting 
        ``Assistant Secretaries of Health and Human Services (7)''.
    (b) Expansion of Duties.--Section 711(a) of the Social Security Act 
(42 U.S.C. 912(a)) is amended by striking ``and access to (and the 
quality of) health care in rural areas'' and inserting ``access to, and 
quality of, health care in rural areas, and reforms to the health care 
system and the implications of such reforms for rural areas''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on January 1, 1996.

SEC. 4. MEDICARE REIMBURSEMENT FOR TELEMEDICINE SERVICES.

    (a) Sense of the Congress.--It is the sense of the Congress that--
            (1) the use of telemedicine services can increase access to 
        specialized health care for rural residents; and
            (2) although telemedicine services are currently being 
        furnished to medicare beneficiaries across the country, 
        providers of telemedicine services do not receive reimbursement 
        for such services under the medicare program.
    (b) Purpose.--It is the purpose of this section to improve access 
to specialized health services for rural medicare beneficiaries by 
requiring the medicare program to reimburse providers for furnishing 
telemedicine services.
    (c) Methodology for Determining Payment.--Not later than January 1, 
1996, the Secretary of Health and Human Services shall develop and 
submit to the Congress a recommendation on a methodology for 
determining payments under title XVIII of the Social Security Act for 
telemedicine services (as defined by the Secretary).
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