[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 1678 Introduced in Senate (IS)]







106th CONGRESS
  1st Session
                                S. 1678

     To amend title XVIII of the Social Security Act to modify the 
             provisions of the Balanced Budget Act of 1997.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            October 1, 1999

 Mr. Daschle (for himself, Mr. Moynihan, Mr. Rockefeller, Mr. Kennedy, 
  Mr. Kerry, Mr. Baucus, Mr. Bingaman, Ms. Mikulski, Mr. Durbin, Mr. 
Reid, Mr. Kerrey, Mr. Torricelli, Mr. Cleland, Mrs. Boxer, Mr. Johnson, 
 Mr. Reed, Mrs. Murray, Mr. Schumer, Mr. Breaux, Mr. Dodd, Mr. Levin, 
  Mr. Sarbanes, Mr. Leahy, Mr. Wellstone, Mr. Bryan, Mr. Dorgan, Mr. 
  Lautenberg, Mr. Byrd, Mr. Harkin, Mrs. Feinstein, Mrs. Lincoln, Mr. 
    Robb, Mr. Inouye, Mr. Hollings and Mr. Edwards) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
     To amend title XVIII of the Social Security Act to modify the 
             provisions of the Balanced Budget Act of 1997.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; AMENDMENTS TO SOCIAL SECURITY ACT; TABLE OF 
              CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Medicare 
Beneficiary Access to Care Act of 1999''.
    (b) Amendments to Social Security Act.--Except as otherwise 
specifically provided, whenever in this Act an amendment is expressed 
in terms of an amendment to or repeal of a section or other provision, 
the reference shall be considered to be made to that section or other 
provision of the Social Security Act.
    (c) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; amendments to Social Security Act; table of 
                            contents.
                           TITLE I--HOSPITALS

Sec. 101. Multiyear transition to prospective payment system for 
                            hospital outpatient department services.
Sec. 102. Limitation in reduction of payments to disproportionate share 
                            hospitals.
Sec. 103. Changes to DSH allotments and transition rule.
Sec. 104. Revision of criteria for designation as a critical access 
                            hospital.
Sec. 105. Sole community hospitals and Medicare dependent hospitals.
                  TITLE II--GRADUATE MEDICAL EDUCATION

Sec. 201. Revision of multiyear reduction of indirect graduate medical 
                            education payments.
Sec. 202. Acceleration of GME phase-in.
Sec. 203. Exclusion of nursing and allied health education costs in 
                            calculating Medicare+Choice payment rate.
Sec. 204. Adjustments to limitations on number of interns and 
                            residents.
                        TITLE III--HOSPICE CARE

Sec. 301. Increase in payments for hospice care.
                  TITLE IV--SKILLED NURSING FACILITIES

Sec. 401. Modification of case mix categories for certain conditions.
Sec. 402. Exclusion of clinical social worker services and services 
                            performed under a contract with a rural 
                            health clinic or Federally qualified health 
                            center from the PPS for SNFs.
Sec. 403. Exclusion of certain services from the PPS for SNFs.
Sec. 404. Exclusion of swing beds in critical access hospitals from the 
                            PPS for SNFs.
              TITLE V--OUTPATIENT REHABILITATION SERVICES

Sec. 501. Modification of financial limitation on rehabilitation 
                            services.
                     TITLE VI--PHYSICIANS' SERVICES

Sec. 601. Technical amendment to update adjustment factor and physician 
                            sustainable growth rate.
Sec. 602. Publication of estimate of conversion factor and MedPAC 
                            review.
                         TITLE VII--HOME HEALTH

Sec. 701. Delay in the 15 percent reduction in payments under the PPS 
                            for home health services.
Sec. 702. Increase in per visit limit.
Sec. 703. Treatment of Outliers.
Sec. 704. Elimination of 15-minute billing requirement.
Sec. 705. Recoupment of overpayments.
Sec. 706. Refinement of home health agency consolidated billing.
                      TITLE VIII--MEDICARE+CHOICE

Sec. 801. Delay in ACR deadline under the Medicare+Choice program.
Sec. 802. Change in time period for exclusion of Medicare+Choice 
                            organizations that have had a contract 
                            terminated.
Sec. 803. Enrollment of medicare beneficiaries in alternative 
                            Medicare+Choice plans and medigap coverage 
                            in case of involuntary termination of 
                            Medicare+Choice enrollment.
Sec. 804. Applying medigap and Medicare+Choice protections to disabled 
                            and ESRD medicare beneficiaries.
Sec. 805. Extended Medicare+Choice disenrollment window for certain 
                            involuntarily terminated enrollees.
Sec. 806. Nonpreemption of State prescription drug coverage mandates in 
                            case of approved State medigap waivers.
Sec. 807. Modification of payment rules for certain frail elderly 
                            Medicare beneficiaries.
Sec. 808. Extension of Medicare community nursing organization 
                            demonstration projects.
                           TITLE IX--CLINICS

Sec. 901. New prospective payment system for Federally-qualified health 
                            centers and rural health clinics under the 
                            Medicaid Program.

                           TITLE I--HOSPITALS

SEC. 101. MULTIYEAR TRANSITION TO PROSPECTIVE PAYMENT SYSTEM FOR 
              HOSPITAL OUTPATIENT DEPARTMENT SERVICES.

    (a) In General.--Section 1833(t) (42 U.S.C. 1395(t)) is amended by 
adding at the end the following:
            ``(10) Multiyear transition.--
                    ``(A) In general.--In the case of covered OPD 
                services furnished by a hospital during a transition 
                year, the Secretary shall increase the payments for 
                such services under the prospective payment system 
                established under this subsection by the amount (if 
                any) that the Secretary determines is necessary to 
                ensure that the payment to cost ratio of the hospital 
                for the transition year equals the applicable 
                percentage of the payment to cost ratio of the hospital 
                for 1996.
                    ``(B) Payment to cost ratio.--
                            ``(i) In general.--The payment to cost 
                        ratio of a hospital for any year is the ratio 
                        which--
                                    ``(I) the hospital's reimbursement 
                                under this part for covered OPD 
                                services furnished during the year, 
                                including through cost-sharing 
                                described in subparagraph (D)(ii), 
                                bears to
                                    ``(II) the cost of such services.
                            ``(ii) Calculation of 1996 payment to cost 
                        ratio.--The Secretary shall determine each 
                        hospital's payment to cost ratio for 1996 as if 
                        the amendments to this title by the provisions 
                        of section 4521 of the Balanced Budget Act of 
                        1997 were in effect in 1996.
                            ``(iii) Transition years.--The Secretary 
                        shall estimate each payment to cost ratio of a 
hospital for any transition year before the beginning of such year.
                    ``(C) Interim payments.--
                            ``(i) In general.--The Secretary shall make 
                        interim payments to a hospital during any 
                        transition year for which the Secretary 
                        estimates a payment is required under 
                        subparagraph (A).
                            ``(ii) Adjustments.--If the Secretary makes 
                        payments under clause (i) for any transition 
                        year, the Secretary shall make retrospective 
                        adjustments to each hospital based on its 
                        settled cost report so that the amount of any 
                        additional payment to a hospital for such year 
                        equals the amount described in subparagraph 
                        (A).
                    ``(D) Definitions.--In this paragraph:
                            ``(i) Applicable percentage.--The term 
                        `applicable percentage' means, with respect to 
                        covered OPD services furnished during--
                                    ``(I) the first full year (and any 
                                portion of the immediately preceding 
                                year) for which the prospective payment 
                                system under this subsection is in 
                                effect, 95 percent;
                                    ``(II) the second full calendar 
                                year for which such system is in 
                                effect, 90 percent; and
                                    ``(III) the third full calendar 
                                year for which such system is in 
                                effect, 85 percent.
                            ``(ii) Cost-sharing.--The term `cost-
                        sharing' includes--
                                    ``(I) copayment amounts described 
                                in paragraph (5);
                                    ``(II) coinsurance described in 
                                section 1866(a)(2)(A)(ii); and
                                    ``(III) the deductible described 
                                under section 1833(b).
                            ``(iii) Transition year.--The term 
                        `transition year' means any year (or portion 
                        thereof) described in clause (i).
                    ``(E) Effect on copayments.--Nothing in this 
                paragraph shall be construed as affecting the 
                unadjusted copayment amount described in paragraph 
                (3)(B).
                    ``(F) Application without regard to budget 
                neutrality.--The transitional payments made under this 
                paragraph--
                            ``(i) shall not be considered an adjustment 
                        under paragraph (2)(E); and
                            ``(ii) shall not be implemented in a budget 
                        neutral manner.''.
    (b) Special Rule for Rural and Cancer Hospitals.--Section 1833(t) 
(42 U.S.C. 1395(t)), as amended by subsection (a), is amended by adding 
at the end the following:
            ``(11) Special rule for rural and cancer hospitals.--
                    ``(A) In general.--For each year (or portion 
                thereof), beginning in 2000, in the case of covered OPD 
                services furnished by a medicare-dependent, small rural 
                hospital (as defined in section 1886(d)(5)(G)(iv)), a 
                sole community hospital (as defined in section 
                1886(d)(5)(D)(iii)), or in a hospital described in 
                section 1886(d)(1)(B)(v), the Secretary shall increase 
                the payments for such services under the prospective 
                payment system established under this subsection by the 
                amount (if any) that the Secretary determines is 
                necessary to ensure that the payment to cost ratio of 
                the hospital (as determined pursuant to paragraph 
                (10)(B)) for the year equals the payment to cost ratio 
                of the hospital for 1996 (as calculated under clause 
                (ii) of such paragraph).
                    ``(B) Interim payments.--
                            ``(i) In general.--The Secretary shall make 
                        interim payments to a hospital during any year 
                        for which the Secretary estimates a payment is 
                        required under subparagraph (A).
                            ``(ii) Adjustments.--If the Secretary makes 
                        payments under clause (i) for any year, the 
                        Secretary shall make retrospective adjustments 
                        to each hospital based on its settled cost 
                        report so that the amount of any additional 
                        payment to a hospital for such year equals the 
                        amount described in subparagraph (A).
                    ``(C) Effect on copayments.--Nothing in this 
                paragraph shall be construed as affecting the 
                unadjusted copayment amount described in paragraph 
                (3)(B).
                    ``(D) Application without regard to budget 
                neutrality.--The payments made under this paragraph--
                            ``(i) shall not be considered an adjustment 
                        under paragraph (2)(E); and
                            ``(ii) shall not be implemented in a budget 
                        neutral manner.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect as if included in the amendments made by section 4523 of the 
Balanced Budget Act of 1997 (Public Law 105-33; 111 Stat. 445).

SEC. 102. LIMITATION IN REDUCTION OF PAYMENTS TO DISPROPORTIONATE SHARE 
              HOSPITALS.

    (a) In General.--Section 1886(d)(5)(F)(ix) (42 U.S.C. 
1395ww(d)(5)(F)(ix)) is amended--
            (1) in subclause (II)--
                    (A) by striking ``fiscal year 1999,'' and inserting 
                ``each of fiscal years 1999, 2000, 2001, and 2002,''; 
                and
                    (B) by inserting ``and'' after the semicolon;
            (2) by striking subclauses (III), (IV), and (V); and
            (3) by redesignating subclause (VI) as subclause (III).
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect as if included in the amendments made by section 4403 of 
the Balanced Budget Act of 1997 (Public Law 105-33; 111 Stat. 398).

SEC. 103. CHANGES TO DSH ALLOTMENTS AND TRANSITION RULE.

    (a) Change in Disproportionate Share Hospital Allotments.--Section 
1923(f)(2) (42 U.S.C. 1396r-4(f)(2)) is amended, in the table contained 
in such section and in the DSH Allotments for fiscal years 2000, 2001, 
and 2002--
            (1) for Minnesota, by striking ``16'' and inserting ``33'';
            (2) for New Mexico, by striking ``5'' and inserting ``9''; 
        and
            (3) for Wyoming, by striking ``0'' and inserting ``0.1''.
    (b) Making Medicaid DSH Transition Rule Permanent.--Section 4721(e) 
of the Balanced Budget Act of 1997 is amended--
            (1) in the matter before paragraph (1), by striking 
        ``1923(g)(2)(A)'' and ``1396r-4(g)(2)(A)'' and inserting 
        ``1923(g)(2)'' and ``1396r-4(g)(2)'', respectively;
            (2) in paragraphs (1) and (2)--
                    (A) by striking ``, and before July 1, 1999''; and
                    (B) by striking ``in such section'' and inserting 
                ``in subparagraph (A) of such section''; and
            (3) by striking ``and'' at the end of paragraph (1), by 
        striking the period at the end of paragraph (2) and inserting 
        ``; and'', and by adding at the end the following:
            ``(3) effective for State fiscal years that begin on or 
        after July 1, 1999, `or (b)(1)(B)' were inserted in 
        1923(g)(2)(B)(ii)(I) after `(b)(1)(A)'.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect as if included in the enactment of the Balanced Budget Act of 
1997 (Public Law 105-33; 111 Stat. 251).

SEC. 104. REVISION OF CRITERIA FOR DESIGNATION AS A CRITICAL ACCESS 
              HOSPITAL.

    (a) Criteria for Designation.--Section 1820(c)(2)(B)(iii) (42 
U.S.C. 1395i-4(c)(2)(B)(iii)) is amended by striking ``to exceed 96 
hours'' and all that follows before the semicolon and inserting ``to 
exceed, on average, 96 hours per patient''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect 60 days after the date of enactment of this Act.

SEC. 105. SOLE COMMUNITY HOSPITALS AND MEDICARE DEPENDENT HOSPITALS.

    (a) In General.--Section 1886(b)(3)(B)(iv) (42 U.S.C. 
1395ww(b)(3)(B)(iv)) is amended--
            (1) in subclause (III), by striking ``and'' at the end;
            (2) in subclause (IV)--
                    (A) by striking ``fiscal year 1996 and each 
                subsequent fiscal year'' and inserting ``fiscal years 
                1996 through 1999''; and
                    (B) by striking the period at the end and inserting 
                ``, and''; and
            (3) by adding at the end the following:
            ``(V) for fiscal year 2000 and each subsequent fiscal year, 
        the market basket percentage increase.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect on the date of enactment of this Act.

                  TITLE II--GRADUATE MEDICAL EDUCATION

SEC. 201. REVISION OF MULTIYEAR REDUCTION OF INDIRECT GRADUATE MEDICAL 
              EDUCATION PAYMENTS.

    (a) In General.--Section 1886(d)(5)(B)(ii) (42 U.S.C. 
1395ww(d)(5)(B)(ii)) is amended by striking subclauses (III), (IV), and 
(V) and inserting the following:
                                    ``(III) during each of fiscal years 
                                1999 through 2007, `c' is equal to 1.6; 
                                and
                                    ``(IV) on or after October 1, 2007, 
                                `c' is equal to 1.35.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect as if included in section 4621 of the Balanced Budget Act 
of 1997 (Public Law 105-33; 111 Stat. 475).

SEC. 202. ACCELERATION OF GME PHASE-IN.

    (a) Acceleration of Payment to Hospitals of Indirect and Direct 
Medical Education Costs for Medicare+Choice Enrollees.--
            (1) In general.--Section 1886(h)(3)(D)(ii) (42 U.S.C. 
        1395ww(h)(3)(D)(ii)) is amended by striking subclauses (IV) and 
        (V) and inserting the following:
                                    ``(IV) 100 percent in 2001 and 
                                subsequent years.''.
            (2) Acceleration of carve-out.--Section 1853(c)(3)(B)(ii) 
        (42 U.S.C. 1395w-23(c)(3)(B)(ii)) is amended--
                    (A) in subclause (III), by inserting ``and'' at the 
                end;
                    (B) by striking subclause (IV); and
                    (C) by redesignating subclause (V) as subclause 
                (IV).
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect as if included in the enactment of the Balanced Budget Act 
of 1997 (Public Law 105-33; 111 Stat. 251).

SEC. 203. EXCLUSION OF NURSING AND ALLIED HEALTH EDUCATION COSTS IN 
              CALCULATING MEDICARE+CHOICE PAYMENT RATE.

    (a) Excluding Costs in Calculating Payment Rate.--
            (1) In general.--Section 1853(c)(3)(C)(i) (42 U.S.C. 1395w-
        23(c)(3)(C)(i)) is amended--
                    (A) in subclause (I), by striking ``and'' at the 
                end;
                    (B) in subclause (II), by striking the period at 
                the end and inserting ``, and''; and
                    (C) by adding at the end the following:
                                    ``(III) for costs attributable to 
                                approved nursing and allied health 
                                education programs under section 
                                1861(v).''.
            (2) Effective date.--The amendments made by paragraph (1) 
        shall apply in determining the annual per capita rate of 
        payment for years beginning with 2001.
    (b) Payment to Hospitals of Nursing and Allied Health Education 
Program Costs for Medicare+Choice Enrollees.--Section 1861(v)(1) (42 
U.S.C. 1395x(v)(1)) is amended by adding at the end the following:
    ``(V)(i) In determining the amount of payment to a hospital for 
portions of cost reporting periods occurring on or after January 1, 
2001, with respect to the reasonable costs for approved nursing and 
allied health education programs, individuals who are enrolled with a 
Medicare+Choice organization under part C shall be treated as if they 
were not so enrolled.
    ``(ii) The Secretary shall establish rules for applying clause (i) 
to a hospital reimbursed under a reimbursement system authorized under 
section 1814(b)(3) in the same manner as it would apply to the hospital 
if it were not reimbursed under such section.''.

SEC. 204. ADJUSTMENTS TO LIMITATIONS ON NUMBER OF INTERNS AND 
              RESIDENTS.

    (a) Indirect Graduate Medical Education Adjustment.--Section 
1886(d)(5)(B)(v) (42 U.S.C. 1395ww(d)(5)(B)(v)) is amended--
            (1) by striking ``(v) In determining'' and inserting 
        ``(v)(I) Subject to subclause (II), in determining'';
            (2) by striking ``in the hospital with respect to the 
        hospital's most recent cost reporting period ending on or 
        before December 31, 1996'' and inserting ``who were appointed 
        by the hospital's approved medical residency training programs 
        for the hospital's most recent cost reporting period ending on 
        or before December 31, 1996''; and
            (3) by adding at the end the following:
    ``(II) Beginning on or after January 1, 1997, in the case of a 
hospital that sponsors only 1 allopathic or osteopathic residency 
program, the limit determined for such hospital under subclause (I) 
may, at the hospital's discretion, be increased by 1 for each calendar 
year but shall not exceed a total of 3 more than the limit determined 
for the hospital under subclause (I).''.
    (b) Direct Graduate Medical Education Adjustment.--
            (1) Limitation on number of residents.--Section 
        1886(h)(4)(F) (42 U.S.C. 1395ww(h)(4)(F)) is amended by 
        inserting ``who were appointed by the hospital's approved 
        medical residency training programs'' after ``may not exceed 
        the number of such full-time equivalent residents''.
            (2) Funding for programs.--Section 1886(h)(4)(H)(i) (42 
        U.S.C. 1395ww(h)(4)(H)(i)) is amended in the second sentence, 
        by inserting ``, including facilities that are not located in 
        an underserved rural area but have established separately 
        accredited rural training tracks'' before the period.
    (c) GME Payments for Certain Interns and Residents.--
            (1) Indirect and direct medical education.--Each limitation 
        regarding the number of residents or interns for which payment 
        may be made under section 1886 of the Social Security Act (42 
        U.S.C. 1395ww) is increased by the number of applicable 
        residents (as defined in paragraph (2)).
            (2) Applicable resident defined.--In this subsection, the 
        term ``applicable resident'' means a resident or intern that--
                    (A) participated in graduate medical education at a 
                facility of the Department of Veterans Affairs;
                    (B) was subsequently transferred on or after 
                January 1, 1997, and before July 31, 1998, to a 
                hospital and the hospital was not a Department of 
                Veterans Affairs facility; and
                    (C) was transferred because the approved medical 
                residency program in which the resident or intern 
                participated would lose accreditation by the 
                Accreditation Council on Graduate Medical Education if 
                such program continued to train residents at the 
                Department of Veterans Affairs facility.
    (d) Effective Date.--This section shall take effect as if included 
in the enactment of the Balanced Budget Act of 1997 (Public Law 105-33; 
111 Stat. 251).

                        TITLE III--HOSPICE CARE

SEC. 301. INCREASE IN PAYMENTS FOR HOSPICE CARE.

    (a) In General.--Section 1814(i)(1)(C)(ii)(VI) (42 U.S.C. 
1395f(i)(1)(C)(ii)(VI)) is amended by striking ``through 2002'' and 
inserting ``and 1999''.
    (b) Effective Date.--The amendments made by this section shall take 
effect as if included in the amendments made by section 4441 of the 
Balanced Budget Act of 1997 (Public Law 105-33; 111 Stat. 422).

                  TITLE IV--SKILLED NURSING FACILITIES

SEC. 401. MODIFICATION OF CASE MIX CATEGORIES FOR CERTAIN CONDITIONS.

    (a) In General.--For purposes of applying any formula under 
paragraph (1) of section 1888(e) of the Social Security Act (42 U.S.C. 
1395yy(e)), for services provided on or after April 1, 2000, and before 
the earlier of October 1, 2001, or the date described in subsection 
(d), the Secretary of Health and Human Services shall increase the 
adjusted Federal per diem rate otherwise determined under paragraph (4) 
of such section for services provided to any individual during the 
period in which such individual is in a RUG III category by the 
applicable payment add-on as determined in accordance with the 
following table:

RUG III category                               Applicable paymentadd-on
    RUB...........................................              $23.06 
    RVC...........................................              $76.25 
    RVB...........................................              $30.36 
    RHC...........................................              $54.07 
    RHB...........................................              $27.28 
    RMC...........................................              $69.98 
    RMB...........................................              $30.09 
    SE3...........................................              $98.41 
    SE2...........................................              $89.05 
    SSC...........................................              $46.80 
    SSB...........................................              $55.56 
    SSA...........................................              $59.94.
    (b) Update.--The Secretary shall update the applicable payment add-
on under subsection (a) for fiscal year 2001 by the skilled nursing 
facility market basket percentage change (as defined under section 
1888(e)(5)(B) of the Social Security Act (42 U.S.C. 1395yy(e)(5)(B))) 
applicable to such fiscal year.
    (c) Rule of Construction.--Nothing in this section shall be 
construed as permitting the Secretary of Health and Human Services to 
include any applicable payment add-on determined under subsection (a) 
in updating the Federal per diem rate under section 1888(e)(4) of the 
Social Security Act (42 U.S.C. 1395yy(e)(4)).
    (d) Date Described.--The date described in this subsection is the 
date that the Secretary of Health and Human Services--
            (1) refines the case mix classification system under 
        section 1888(e)(4)(G)(i) of the Social Security Act (42 U.S.C. 
        1395yy(e)(4)(G)(i)) to better account for medically complex 
        patients; and
            (2) implements such refined system.

SEC. 402. EXCLUSION OF CLINICAL SOCIAL WORKER SERVICES AND SERVICES 
              PERFORMED UNDER A CONTRACT WITH A RURAL HEALTH CLINIC OR 
              FEDERALLY QUALIFIED HEALTH CENTER FROM THE PPS FOR SNFS.

    (a) In General.--Section 1888(e)(2)(A)(ii) (42 U.S.C. 
1395yy(e)(2)(A)(ii)) is amended--
            (1) in the first sentence, by inserting ``clinical social 
        worker services,'' after ``qualified psychologist services,''; 
        and
            (2) by inserting after the first sentence the following: 
        ``Services described in this clause also include services that 
        are provided by a physician, a physician assistant, a nurse 
        practitioner, a qualified psychologist, or a clinical social 
        worker who is employed, or otherwise under contract, with a 
        rural health clinic or a Federally qualified health center.''.
    (b) Conforming Amendment.--Section 1861(hh)(2) (42 U.S.C. 
1395x(hh)(2)) is amended by striking ``and other than services 
furnished to an inpatient of a skilled nursing facility which the 
facility is required to provide as a requirement for participation''.
    (c) Effective Date.--The amendments made by this section shall 
apply to services provided on or after the date which is 60 days after 
the date of enactment of this Act.

SEC. 403. EXCLUSION OF CERTAIN SERVICES FROM THE PPS FOR SNFS.

    (a) In General.--Section 1888(e)(2)(A)(ii) (42 U.S.C. 
1395yy(e)(2)(A)(ii)), as amended by section 402, is amended--
            (1) in the first sentence, by inserting ``ambulance 
        services, services identified by HCPCS code in Program 
        Memorandum Transmittal No. A-98-37 issued in November 1998 (but 
        without regard to the setting in which such services are 
        furnished),'' after ``subparagraphs (F) and (O) of section 
        1861(s)(2),''; and
            (2) by inserting after the second sentence the following: 
        ``In addition to the services described in the previous 
        sentences, services described in this clause include 
        chemotherapy items (identified as of July 1, 1999, by HCPCS 
        codes J9000-J9020, J9040-J9151, J9170-J9185, J9200-J9201, 
        J9206-J9208, J9211, J9230-J9245, and J9265-J9600), chemotherapy 
        administration services (identified as of July 1, 1999, by 
        HCPCS codes 36260-36262, 36489, 36530-36535, 36640, 36823, and 
        96405-96542), radioisotope services (identified as of July 1, 
        1999, by HCPCS codes 79030-79440), and customized prosthetic 
        devices (identified as of July 1, 1999, by HCPCS codes L5050-
        L5340, L5500-L5610, L5613-L5986, L5988, L6050-L6370, L6400-
        L6880, L6920-L7274, and L7362-L7366).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to services furnished on or after the date which is 60 days after 
the date of enactment of this Act.

SEC. 404. EXCLUSION OF SWING BEDS IN CRITICAL ACCESS HOSPITALS FROM THE 
              PPS FOR SNFS.

    (a) In General.--Section 1888(e)(7) of the Social Security Act (42 
U.S.C. 1395yy(e)(7)) is amended--
            (1) in the heading, by striking ``Transition'' and 
        inserting ``Special Rules'';
            (2) in subparagraph (A), by striking ``In general.--The'' 
        and inserting ``Transition.--Except as provided in subparagraph 
        (C), the''; and
            (3) by adding at the end the following:
                            ``(C) Exemption of swing beds in critical 
                        access hospitals from PPS.--The prospective 
                        payment system under this subsection shall not 
                        apply (and section 1834(g) shall apply) to 
                        services provided by a critical access hospital 
                        under an agreement described in subparagraph 
                        (B).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to services provided on or after October 1, 1999.

              TITLE V--OUTPATIENT REHABILITATION SERVICES

SEC. 501. MODIFICATION OF FINANCIAL LIMITATION ON REHABILITATION 
              SERVICES.

    (a) 3-Year Repeal.--Section 1833(g) (42 U.S.C. 1395l(g)) is amended 
by adding at the end the following:
    ``(4) Subject to paragraph (6), the provisions of paragraphs (1) 
through (3) shall not apply to outpatient physical therapy services, 
outpatient occupational therapy services, and outpatient speech-
language pathology services covered under this title and furnished on 
or after January 1, 2000.
    ``(5)(A) Notwithstanding the preceding provisions of this 
subsection and subject to subparagraph (B), with respect to services 
described in paragraph (4) that are furnished on or after January 1, 
2003, the Secretary shall implement, by not later than January 1, 2003, 
a payment system for such services that takes into account the needs of 
beneficiaries under this title for differing amounts of therapy based 
on factors such as diagnosis, functional status, and prior use of 
services.
    ``(B) The payment system established under subparagraph (A) shall 
be designed so that the system shall not result in any increase or 
decrease in the expenditures under this title on a fiscal year basis, 
determined as if paragraph (4) had not been enacted.
    ``(6) If the Secretary for any reason does not implement the 
payment system described in paragraph (5) on or before January 1, 2003, 
paragraph (4) shall not apply with respect to services described in 
such paragraph that are furnished on or after such date and before the 
date on which the Secretary implements such payment system.''.
    (b) Effective Date.--The amendment made by this section shall take 
effect as if included in the enactment of the Balanced Budget Act of 
1997 (Public Law 105-33; 111 Stat. 251).

                     TITLE VI--PHYSICIANS' SERVICES

SEC. 601. TECHNICAL AMENDMENT TO UPDATE ADJUSTMENT FACTOR AND PHYSICIAN 
              SUSTAINABLE GROWTH RATE.

    (a) Update Adjustment Factor.--
            (1) Change to calendar year basis.--Section 1848(d) (42 
        U.S.C. 1395w-4(d)) is amended--
                    (A) in paragraph (1), by striking subparagraph (E) 
                and inserting the following:
                    ``(E) Publication.--The Secretary shall publish in 
                the Federal Register--
                            ``(i) not later than November 1 of each 
                        year (beginning with 1999), the conversion 
                        factor that will apply to physicians' services 
                        for the succeeding year and the update 
                        determined under paragraph (3) for such year; 
                        and
                            ``(ii) not later than November 1 of 1999--
                                    ``(I) the special update for the 
                                year 2000 under paragraph (3)(E)(i); 
                                and
                                    ``(II) the estimated special 
                                adjustments for years 2001 through 2006 
                                under paragraph (3)(E)(ii).''; and
                    (B) in paragraph (3)(C)--
                            (i) in the matter preceding clause (i), by 
                        striking ``the 12-month period ending with 
                        March 31 of'';
                            (ii) in clause (i)--
                                    (I) by striking ``1997'' and 
                                inserting ``1996,''; and
                                    (II) by striking ``such 12-month 
                                period'' and inserting ``1996''; and
                            (iii) in clause (ii)--
                                    (I) by inserting a comma after 
                                ``subsequent year''; and
                                    (II) by striking ``fiscal year 
                                which begins during such 12-month 
                                period'' and inserting ``year 
                                involved''.
            (2) Formula for determining the update adjustment factor.--
        Section 1848(d)(3) (42 U.S.C. 1395w-4(d)(3)) is amended--
                    (A) in subparagraph (A)--
                            (i) in clause (ii), by striking ``(divided 
                        by 100),'' and inserting a period; and
                            (ii) by striking the matter following 
                        clause (ii);
                    (B) in subparagraph (B)--
                            (i) in the matter preceding clause (i), by 
                        inserting ``the sum of'' after ``Secretary) 
                        to''; and
                            (ii) by striking clauses (i) and (ii) and 
                        inserting the following:
                            ``(i) the figure arrived at by--
                                    ``(I) determining the difference 
                                between the allowed expenditures for 
                                physicians' services for the prior year 
                                (as determined under subparagraph (C)) 
                                and the actual expenditures for such 
                                services for that year;
                                    ``(II) dividing that difference by 
                                the actual expenditures for such 
                                services in that year; and
                                    ``(III) multiplying that quotient 
                                by 0.75; and
                            ``(ii) the figure arrived at by--
                                    ``(I) determining the difference 
                                between the allowed expenditures for 
                                physicians' services (as determined 
                                under subparagraph (C)) from 1996 
                                through the prior year and the actual 
                                expenditures for such services during 
                                that period, corrected with the best 
                                available data;
                                    ``(II) dividing that difference by 
                                actual expenditures for such services 
                                for the prior year as increased by the 
                                sustainable growth rate under 
                                subsection (f) for the year whose 
                                update adjustment factor is to be 
determined; and
                                    ``(III) multiplying that quotient 
                                by 0.33.''; and
                    (C) by amending subparagraph (D) to read as 
                follows:
                    ``(D) Restriction on update adjustment factor.--The 
                update adjustment factor determined under subparagraph 
                (B) for a year may not be less than negative 0.07 or 
                greater than 0.03.''.
            (3) Special provisions.--Section 1848(d)(3) (42 U.S.C. 
        1395w-4(d)(3)) is amended--
                    (A) in subparagraph (A), in the matter preceding 
                clause (i), by striking ``subparagraph (D)'' and 
                inserting ``subparagraphs (D) and (E)''; and
                    (B) by adding at the end the following:
                    ``(E) Special update and adjustments.--
                            ``(i) Year 2000.--For the year 2000, the 
                        update under this paragraph shall be the 
                        percentage that the Secretary estimates will, 
                        without regard to any otherwise applicable 
                        restriction, result in expenditures equal to 
                        the expenditures that would have occurred in 
                        that year in the absence of the amendments made 
                        by section 601 of the Medicare Beneficiary 
                        Access to Care Act of 1999.
                            ``(ii) Years 2001-2006.--For each of the 
                        years 2001 through 2006, the Secretary shall 
                        make that adjustment to the update for that 
                        year which the Secretary estimates will, 
                        without regard to any otherwise applicable 
                        restriction, result in expenditures equal to 
                        the expenditures that would have occurred for 
                        that year in the absence of the amendments made 
                        by section 601 of the Medicare Beneficiary 
                        Access to Care Act of 1999.''.
    (b) Sustainable Growth Rate.--Section 1848(f) (42 U.S.C. 1395w-
4(f)) is amended--
            (1) by striking paragraph (1) and inserting the following:
            ``(1) Publication.--Not later than November 1 of each year 
        (beginning with 1999), the Secretary shall publish in the 
        Federal Register the sustainable growth rate as determined 
        under this subsection for the succeeding year, the current 
        year, and each of the preceding 2 years.''; and
            (2) in paragraph (2)--
                    (A) by striking ``fiscal'' each place it appears; 
                and
                    (B) in the matter preceding subparagraph (A), by 
                striking ``year 1998'' and inserting ``1997''.
    (c) Data To Be Used in Determining the Sustainable Growth Rate.--
Section 1848(f) (42 U.S.C. 1395w-4(f)) is amended--
            (1) by redesignating paragraph (3) as paragraph (4); and
            (2) by inserting after paragraph (2) the following:
            ``(3) Methodology.--For purposes of determining the update 
        adjustment factor under subsection (d)(3)(B) and the allowed 
        expenditures under subsection (d)(3)(C) for a year, the 
        sustainable growth rate for each year taken into consideration 
        in the determination under paragraph (2) shall be determined as 
        follows:
                    ``(A) For purposes of such calculations for the 
                year 2000, the sustainable growth rate shall be 
                determined on the basis of the best data available to 
                the Secretary as of September 1, 1999.
                    ``(B) For purposes of such calculations for each 
                year after the year 2000--
                            ``(i) the sustainable growth rate for such 
                        year and each of the 2 preceding years shall be 
                        determined on the basis of the best data 
                        available to the Secretary as of September 1 of 
                        such year; and
                            ``(ii) the sustainable growth rate for each 
                        year preceding the years specified in clause 
                        (i) shall be the rate used for such year in 
                        such calculation for the immediately preceding 
                        year.''.
    (d) Effective Date.--
            (1) In general.--Subject to paragraph (2), the amendments 
        made by this section shall take effect as if included in the 
        enactment of the Balanced Budget Act of 1997 (Public Law 105-
        33; 111 Stat. 251).
            (2) No effect on updates for 1998 and 1999.--The amendments 
        made by this section shall have no effect on the updates 
        established by the Secretary for 1998 and 1999, and such 
        established updates may not be changed.

SEC. 602. PUBLICATION OF ESTIMATE OF CONVERSION FACTOR AND MEDPAC 
              REVIEW.

    (a) Publication.--Not later than April 15 of each year (beginning 
in 2000), the Secretary of Health and Human Services (in this section 
referred to as the ``Secretary'') shall publish in the Federal 
Register--
            (1) an estimate of the single conversion factor to be used 
        in the next calendar year for reimbursement of physicians 
        services under section 1848 of the Social Security Act (42 
        U.S.C. 1395w-4); and
            (2) the data on which such estimate is based.
    (b) MedPAC Review and Report.--
            (1) Review.--The Medicare Payment Advisory Commission (in 
        this section referred to as ``MedPAC'') shall annually review 
        the estimates and data published by the Secretary pursuant to 
        subsection (a).
            (2) Report.--Not later than June 30 of each year (beginning 
        in 2000), MedPAC shall submit a report to the Secretary and to 
        the committees of jurisdiction in Congress on the review 
        conducted pursuant to paragraph (1), together with any 
        recommendations as determined appropriate by MedPAC.

                         TITLE VII--HOME HEALTH

SEC. 701. DELAY IN THE 15 PERCENT REDUCTION IN PAYMENTS UNDER THE PPS 
              FOR HOME HEALTH SERVICES.

    (a) Contingency Reduction.--Section 4603(e) of the Balanced Budget 
Act of 1997 (42 U.S.C. 1395fff note), as amended by section 5101(c)(3) 
of the Tax and Trade Relief Extension Act of 1998 (contained in 
division J of Public Law 105-277), is amended by striking ``September 
30, 2000'' and inserting ``September 30, 2002''.
    (b) Prospective Payment System.--Section 1895(b)(3)(A) (42 U.S.C. 
1395fff(b)(3)(A)), as amended by section 5101 of the Tax and Trade 
Relief Extension Act of 1998 (contained in division J of Public Law 
105-277), is amended by striking clause (i) and inserting the 
following:
                            ``(i) In general.--Under such system the 
                        Secretary shall provide for computation of a 
                        standard prospective payment amount (or 
                        amounts) as follows:
                                    ``(I) Such amount (or amounts) 
                                shall initially be based on the most 
                                current audited cost report data 
                                available to the Secretary and shall be 
                                computed in a manner so that the total 
                                amounts payable under the system for 
                                fiscal year 2001, shall be equal to the 
                                total amount that would have been made 
                                if the system had not been in effect;
                                    ``(II) For fiscal year 2003 such 
                                amount (or amounts), shall be equal to 
                                the amount (or amounts) that would have 
                                been determined under subclause (I), if 
                                the reduction in limits described in 
                                clause (ii) had been in effect for 
                                fiscal year 2001, and updated under 
                                subparagraph (B) for fiscal years 2002 
                                and 2003.
                        Each such amount shall be standardized in a 
                        manner that eliminates the effect of variations 
                        in relative case mix and wage levels among 
                        different home health agencies in a budget 
                        neutral manner consistent with the case mix and 
                        wage level adjustments provided under paragraph 
                        (4)(A). Under the system, the Secretary may 
                        recognize regional differences or differences 
                        based upon whether or not the services or 
                        agency are in an urbanized area.''.

SEC. 702. INCREASE IN PER VISIT LIMIT.

    (a) Interim Payment System.--Section 1861(v)(1)(L)(i) (42 U.S.C. 
1395x(v)(1)(L)(i)), as amended by section 701(b), is amended--
            (1) in subclause (IV), by striking ``or'';
            (2) in subclause (V)--
                    (A) by inserting ``and before October 1, 1999,'' 
                after ``October 1, 1998,''; and
                    (B) by striking the period and inserting ``, or''; 
                and
            (3) by adding at the end the following:
            ``(VI) October 1, 1999, 112 percent of such median.''.
    (b) Ensuring the Increase in Per Visit Limit Has No Effect on the 
Prospective Payment System.--The second sentence of section 
1895(b)(3)(A)(i) (42 U.S.C. 1395fff(b)(3)(A)(i)), as amended by section 
5101(c)(1)(B) of the Tax and Trade Relief Extension Act of 1998 
(contained in division J of Public Law 105-277) and section 701(b), is 
amended--
            (1) in subclause (I), by inserting ``but if the reference 
        in section 1861(v)(1)(L)(i)(VI) to 112 percent were a reference 
        to 106 percent'' after ``if the system had not been in 
        effect''; and
            (2) in subclause (II), by inserting ``and if the reference 
        in section 1861(v)(1)(L)(i)(VI) to 112 percent were a reference 
        to 106 percent'' after ``clause (ii) had been in effect for 
        fiscal year 2001''.

SEC. 703. TREATMENT OF OUTLIERS.

    (a) Waiver of Per Beneficiary Limits for Outliers.--Section 
1861(v)(1)(L) (42 U.S.C. 1395x(v)(1)(L)), as amended by section 5101 of 
the Tax and Trade Relief Extension Act of 1998 (contained in division J 
of Public Law 105-277), is amended--
            (1) by redesignating clause (ix) as clause (x); and
            (2) by inserting after clause (viii) the following:
    ``(ix)(I) Notwithstanding the applicable per beneficiary limit 
under clause (v), (vi), or (viii), but subject to the applicable per 
visit limit under clause (i), in the case of a provider that 
demonstrates to the Secretary that with respect to an individual to 
whom the provider furnished home health services appropriate to the 
individual's condition (as determined by the Secretary) at a reasonable 
cost (as determined by the Secretary), and that such reasonable cost 
significantly exceeded such applicable per beneficiary limit because of 
unusual variations in the type or amount of medically necessary care 
required to treat the individual, the Secretary, upon application by 
the provider, shall pay to such provider for such individual such 
reasonable cost.
    ``(II) The total amount of the additional payments made to home 
health agencies pursuant to subclause (I) in any fiscal year shall not 
exceed an amount equal to 2 percent of the amounts that would have been 
paid under this subparagraph in such year if this clause had not been 
enacted.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect on the date of enactment of this Act, and shall apply to 
each application for payment of reasonable costs for outliers submitted 
by any home health agency for cost reporting periods ending on or after 
October 1, 1999.

SEC. 704. ELIMINATION OF 15-MINUTE BILLING REQUIREMENT.

    (a) In General.--Section 1895(c) (42 U.S.C. 1395fff(c)) is amended 
to read as follows:
    ``(c) Requirements for Payment Information.--With respect to home 
health services furnished on or after October 1, 1998, no claim for 
such a service may be paid under this title unless the claim has the 
unique identifier (provided under section 1842(r)) for the physician 
who prescribed the services or made the certification described in 
section 1814(a)(2) or 1835(a)(2)(A).''
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to claims submitted on or after the date which is 60 days after 
the date of enactment of this section.

SEC. 705. RECOUPMENT OF OVERPAYMENTS.

    (a) 36-Month Repayment Period.--In the case of an overpayment by 
the Secretary of Health and Human Services to a home health agency for 
home health services furnished during a cost reporting period beginning 
on or after October 1, 1997, as a result of payment limitations 
provided for under clause (v), (vi), or (viii) of section 1861(v)(1)(L) 
of the Social Security Act (42 U.S.C. 1395x(v)(1)(L)), the home health 
agency may elect to repay the amount of such overpayment ratably over a 
36-month period beginning on the date of notification of such 
overpayment.
    (b) No Interest on Overpayment Amounts.--In the case of an agency 
that makes an election under subsection (a), no interest shall accrue 
on the outstanding balance of the amount of overpayment during such 36-
month period.
    (c) Termination.--No election under subsection (a) may be made for 
cost reporting periods, or portions of cost reporting periods, 
beginning on or after the date of the implementation of the prospective 
payment system for home health services under section 1895 of the 
Social Security Act (42 U.S.C. 1395fff).
    (d) Effective Date.--The provisions of subsection (a) shall apply 
to debts that are outstanding as of the date of enactment of this Act.

SEC. 706. REFINEMENT OF HOME HEALTH AGENCY CONSOLIDATED BILLING.

    (a) In General.--Section 1842(b)(6)(F) (42 U.S.C. 1395u(b)(6)(F)) 
is amended by inserting ``(including medical supplies described in 
section 1861(m)(5), but excluding durable medical equipment described 
in such section)'' after ``home health services''.
    (b) Conforming Amendment.--Section 1862(a)(21) (42 U.S.C. 
1395y(a)(21)) is amended by inserting ``(including medical supplies 
described in section 1861(m)(5), but excluding durable medical 
equipment described in such section)'' after ``home health services''.
    (c) Effective Date.--The amendments made by this section shall take 
effect as if included in the amendments made by section 4603 of the 
Balanced Budget Act of 1997 (Public Law 105-33; 111 Stat. 467).

                      TITLE VIII--MEDICARE+CHOICE

SEC. 801. DELAY IN ACR DEADLINE UNDER THE MEDICARE+CHOICE PROGRAM.

    (a) Delay in Deadline for Submission of Adjusted Community Rates 
and Related Information.--Section 1854(a)(1) (42 U.S.C. 1395w-24(a)(1)) 
is amended by striking ``May 1'' and inserting ``July 1''.
    (b) Adjustment in Information Disclosure Provisions.--Section 
1851(d)(2)(A)(ii) (42 U.S.C. 1395w-21(d)(2)(A)(ii)) is amended in the 
first sentence by inserting ``, to the extent such information is 
available at the time of preparation of the material for mailing'' 
before the period.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

SEC. 802. CHANGE IN TIME PERIOD FOR EXCLUSION OF MEDICARE+CHOICE 
              ORGANIZATIONS THAT HAVE HAD A CONTRACT TERMINATED.

    (a) In General.--Section 1857(c)(4) (42 U.S.C. 1395w-27(c)(4)) is 
amended by striking ``5-year period'' and inserting ``3-year period''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to contract years beginning on or after January 1, 1999.

SEC. 803. ENROLLMENT OF MEDICARE BENEFICIARIES IN ALTERNATIVE 
              MEDICARE+CHOICE PLANS AND MEDIGAP COVERAGE IN CASE OF 
              INVOLUNTARY TERMINATION OF MEDICARE+CHOICE ENROLLMENT.

    (a) Permitting Enrollment in Alternative Plans Upon Receipt of 
Notice of Medicare+Choice Plan Termination.--
            (1) Medicare+choice plans.--Section 1851(e)(4) (42 U.S.C. 
        1395w-21(e)(4)) is amended by striking subparagraph (A) and 
        inserting the following:
                    ``(A)(i) the certification of the organization or 
                plan under this part has been terminated, or the 
                organization or plan has notified the individual of an 
                impending termination of such certification; or
                    ``(ii) the organization has terminated or otherwise 
                discontinued providing the plan in the area in which 
                the individual resides, or has notified the individual 
                of an impending termination or discontinuation of such 
                plan;''.
            (2) Medigap plans.--
                    (A) In general.--Section 1882(s)(3)(A) (42 U.S.C. 
                1395ss(s)(3)(A)) is amended in the matter following 
                clause (iii)--
                            (i) by inserting ``(92 days in the case of 
                        a termination or discontinuation of coverage 
                        under the types of circumstances described in 
                        section 1851(e)(4)(A))'' after ``63 days'';
                            (ii) by inserting ``(or, if elected by the 
                        individual, the date of notification of the 
                        individual by the plan or organization of the 
                        impending termination or discontinuance of the 
                        plan in the area in which the individual 
                        resides)'' after ``the date of the termination 
                        of enrollment described in such subparagraph''; 
                        and
                            (iii) by inserting ``(or date of such 
                        notification)'' after ``the date of termination 
                        or disenrollment''.
                    (B) Effective date.--The amendments made by this 
                paragraph shall apply to notices of intended 
                termination made by group health plans and 
                Medicare+Choice organizations after the date of 
                enactment of this Act.
    (b) Guaranteed Access for Certain Medicare Beneficiaries to Medigap 
Policies in Case of Involuntary Termination of Coverage Under a 
Medicare+Choice Plan.--
            (1) In general.--Section 1882(s)(3)(C)(iii) (42 U.S.C. 
        1395ss(s)(3)(C)(iii)) is amended by inserting ``or an 
        individual described in clause (ii) or (iii) of subparagraph 
        (B) in the case of circumstances described in section 
        1851(e)(4)(A)'' after ``subparagraph (B)(vi)''.
            (2) Effective date.--
                    (A) In general.--Subject to subparagraph (B), the 
                amendment made by paragraph (1) shall apply to 
                terminations of coverage effected on or after the date 
                of enactment of this Act.
                    (B) Transitional medigap open enrollment period for 
                certain individuals affected by plan withdrawals.--In 
                the case of an individual described in clause (ii) or 
                (iii) of subparagraph (B) of section 1882(s)(3) of the 
                Social Security Act in the case of circumstances 
                described in section 1851(e)(4)(A) of such Act 
                (relating to discontinuation of a plan or organization 
                entirely or in an area), if the termination or 
                discontinuation of coverage occurred after December 31, 
                1998, and before the date of enactment of this Act, the 
                provisions of subparagraph (A) of section 1882(s)(3) 
                such Act (in the matter up to and including clause 
                (iii) thereof) shall apply to such an individual who 
                seeks enrollment under a medicare supplemental policy 
                during the 92-day period beginning with the first month 
                that begins more than 30 days after the date of 
                enactment of this Act in the same manner as such 
                provisions apply to an individual described in the 
                matter following such clause (iii).

SEC. 804. APPLYING MEDIGAP AND MEDICARE+CHOICE PROTECTIONS TO DISABLED 
              AND ESRD MEDICARE BENEFICIARIES.

    (a) Assuring Availability of Medigap Coverage.--
            (1) In general.--Section 1882(s) (42 U.S.C. 1395ss(s)) is 
        amended--
                    (A) in paragraph (2)(A), by striking ``is 65 years 
                of age or older and is'' and inserting ``is first'';
                    (B) in paragraph (2)(D), by striking ``who is 65 
                years of age or older as of the date of issuance and''; 
                and
                    (C) in paragraph (3)(B)(vi), by striking ``at age 
                65''.
            (2) Effective date.--The amendments made by paragraph (1) 
        shall apply to terminations of coverage effected on or after 
        the date of enactment of this Act, regardless of when the 
        individuals become eligible for benefits under part A or B of 
        title XVIII of the Social Security Act.
    (b) Permitting ESRD Beneficiaries To Elect Another Medicare+Choice 
Plan in Case of Plan Discontinuance.--
            (1) In general.--Section 1851(a)(3)(B) (42 U.S.C. 1395w-
        21(a)(3)(B)) is amended by striking ``except that'' and all 
        that follows and inserting the following: ``except that--
                            ``(i) an individual who develops end-stage 
                        renal disease while enrolled in a 
                        Medicare+Choice plan may continue to be 
                        enrolled in that plan; and
                            ``(ii) in the case of such an individual 
                        who is enrolled in a Medicare+Choice plan under 
                        clause (i) (or subsequently under this clause), 
                        if the enrollment is discontinued under section 
                        1851(e)(4)(A) the individual will be treated as 
                        a `Medicare+Choice eligible individual' for 
                        purposes of electing to continue enrollment in 
                        another Medicare+Choice plan.''.
            (2) Effective date.--
                    (A) The amendment made by paragraph (1) shall apply 
                to terminations and discontinuations occurring on or 
                after the date of enactment of this Act.
                    (B) Clause (ii) of section 1851(a)(3)(B) of the 
                Social Security Act (as inserted by such amendment) 
                also shall apply to individuals whose enrollment in a 
                Medicare+Choice plan was terminated or discontinued 
                after December 31, 1998, and before the date of 
                enactment of this Act. In applying this subparagraph, 
                such an individual shall be treated, for purposes of 
                part C of title XVIII of the Social Security Act, as 
                having discontinued enrollment in such a plan as of the 
                date of enactment of this Act.

SEC. 805. EXTENDED MEDICARE+CHOICE DISENROLLMENT WINDOW FOR CERTAIN 
              INVOLUNTARILY TERMINATED ENROLLEES.

    (a) Previous Medigap Enrollees.--Section 1882(s)(3)(B)(v)(III) (42 
U.S.C. 1395ss(s)(3)(B)(v)(III)) is amended--
            (1) by inserting ``(aa)'' after ``(III)'';
            (2) by striking the period and inserting ``, or''; and
            (3) by adding at the end the following:
                    ``(bb) during the 12-month period described in item 
                (aa), is disenrolled under the circumstances described 
                in section 1851(e)(4)(A) from the organization 
                described in subclause (II); enrolls, without an 
                intervening enrollment, with another such organization; 
                and subsequently disenrolls during such period (during 
                which the enrollee is permitted to disenroll under 
                section 1851(e)).''.
    (b) Initial Medigap Enrollees.--Section 1882(s)(3)(B)(vi) (42 
U.S.C. 1395ss(s)(3)(B)(vi)), as amended by section 804(a)(1)(C), is 
amended--
            (1) by striking ``benefits under part A, enrolls'' and 
        inserting ``benefits under part A--
                    ``(I) enrolls'';
            (2) by striking the period and inserting ``, or''; and
            (3) by adding at the end the following:
            ``(II)(aa) enrolls in a Medicare+Choice plan under part C, 
        which enrollment is terminated or discontinued under the 
        circumstances described in section 1851(e)(4)(A), and
            ``(bb) subsequently enrolls, without an intervening 
        enrollment, in another Medicare+Choice plan, and disenrolls 
        from such plan by not later than 12 months after the effective 
        date of the enrollment in the Medicare+Choice plan described in 
        item (aa).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to terminations and discontinuations occurring on or after the 
date of enactment of this Act.

SEC. 806. NONPREEMPTION OF STATE PRESCRIPTION DRUG COVERAGE MANDATES IN 
              CASE OF APPROVED STATE MEDIGAP WAIVERS.

    (a) In General.--Section 1856(b)(3) (42 U.S.C. 1395w-26(b)(3)) is 
amended--
            (1) in subparagraph (A), by striking ``The standards'' and 
        inserting ``Subject to subparagraph (C), the standards''; and
            (2) by adding at the end the following:
                    ``(C) Continuation of state prescription drug 
                laws.--Subparagraph (A) shall not supersede any State 
                law that requires the comprehensive coverage of 
                prescription drugs or any regulation that carries out 
                such a law, if--
                            ``(i) the State has a waiver in effect 
                        under section 1882(p)(6)(A) with respect to 
                        requiring such coverage under Medicare 
                        supplemental policies; or
                            ``(ii) the Secretary provides for a waiver 
                        for the State to impose such a requirement 
                        under section 1882(p)(6)(B).''.
    (b) Medigap Waiver.--Section 1882(p)(6) (42 U.S.C. 1395ss(p)(6)) is 
amended--
            (1) by inserting ``(A)'' after ``(6)''; and
            (2) by adding at the end the following:
    ``(B) The Secretary also may waive the application of the standards 
described in paragraph (1)(A)(i) so that a State may include 
comprehensive prescription drug coverage among the benefits required 
for all Medicare supplemental policies.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

SEC. 807. MODIFICATION OF PAYMENT RULES FOR CERTAIN FRAIL ELDERLY 
              MEDICARE BENEFICIARIES.

    (a) Modification of Payment Rules.--Section 1853 (42 U.S.C. 1395w-
23) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1)(A), by striking ``subsections 
                (e) and (f)'' and inserting ``subsections (e) through 
                (i)'';
                    (B) in paragraph (3)(D), by inserting ``and 
                paragraph (4)'' after ``section 1859(e)(4)''; and
                    (C) by adding at the end the following:
            ``(4) Exemption from risk-adjustment system for frail 
        elderly beneficiaries enrolled in specialized programs for the 
        frail elderly.--
                    ``(A) In general.--During the period described in 
                subparagraph (B), the risk-adjustment described in 
                paragraph (3) shall not apply to a frail elderly 
                Medicare+Choice beneficiary (as defined in subsection 
                (i)(3)) who is enrolled in a Medicare+Choice plan under 
                a specialized program for the frail elderly (as defined 
                in subsection (i)(2)).
                    ``(B) Period of application.--The period described 
                in this subparagraph begins with January 2000, and ends 
                with the first month for which the Secretary certifies 
                to Congress that a comprehensive risk adjustment 
                methodology under paragraph (3)(C) (that takes into 
                account the types of factors described in subsection 
                (i)(1)) is being fully implemented.''; and
            (2) by adding at the end the following:
    ``(i) Special Rules for Frail Elderly Enrolled in Specialized 
Programs for the Frail Elderly.--
            ``(1) Development and implementation of new payment 
        system.--The Secretary shall develop and implement (as soon as 
        possible after the date of enactment of this subsection), 
        during the period described in subsection (a)(4)(B), a payment 
        methodology for frail elderly Medicare+Choice beneficiaries 
        enrolled in a Medicare+Choice plan under a specialized program 
        for the frail elderly (as defined in paragraph (2)(A)). Such 
        methodology shall account for the prevalence, mix, and severity 
        of chronic conditions among such beneficiaries and shall 
        include medical diagnostic factors from all provider settings 
        (including hospital and nursing facility settings). It shall 
        include functional indicators of health status and such other 
        factors as may be necessary to achieve appropriate payments for 
        plans serving such beneficiaries.
            ``(2) Specialized program for the frail elderly 
        described.--
                    ``(A) In general.--For purposes of this part, the 
                term `specialized program for the frail elderly' means 
                a program which the Secretary determines--
                            ``(i) is offered under this part as a 
                        distinct part of a Medicare+Choice plan;
                            ``(ii) primarily enrolls frail elderly 
                        Medicare+Choice beneficiaries; and
                            ``(iii) has a clinical delivery system that 
                        is specifically designed to serve the special 
                        needs of such beneficiaries and to coordinate 
                        short-term and long-term care for such 
                        beneficiaries through the use of a team 
                        described in subparagraph (B) and through the 
                        provision of primary care services to such 
                        beneficiaries by means of such a team at the 
                        nursing facility involved.
                    ``(B) Specialized team.--A team described in this 
                subparagraph--
                            ``(i) includes--
                                    ``(I) a physician; and
                                    ``(II) a nurse practitioner or 
                                geriatric care manager, or both; and
                            ``(ii) has as members individuals who have 
                        special training and specialize in the care and 
                        management of the frail elderly beneficiaries.
            ``(3) Frail elderly medicare+choice beneficiary 
        described.--For purposes of this part, the term `frail elderly 
        Medicare+Choice beneficiary' means a Medicare+Choice eligible 
        individual who--
                    ``(A) is residing in a skilled nursing facility or 
                a nursing facility (as defined for purposes of title 
                XIX) for an indefinite period and without any intention 
                of residing outside the facility; and
                    ``(B) has a severity of condition that makes the 
                individual frail (as determined under guidelines 
                approved by the Secretary).''.
    (b) Continuous Open Enrollment for Certain Frail Elderly Medicare 
Beneficiaries.--
            (1) In general.--Section 1851(e) (42 U.S.C. 1395w-21(e)) is 
        amended by adding at the end the following:
            ``(7) Special rules for frail elderly medicare+choice 
        beneficiaries enrolling in specialized programs for the frail 
        elderly.--There shall be a continuous open enrollment period 
        for any frail elderly Medicare+Choice beneficiary (as defined 
        in section 1853(i)(3)) who is seeking to enroll in a 
        Medicare+Choice plan under a specialized program for the frail 
        elderly (as defined in section 1853(i)(2)).''.
            (2) Conforming Amendments.--
                    (A) Open enrollment periods.--Section 1851(e)(6) 
                (42 U.S.C. 1395w-21(e)(6)) is amended--
                            (i) in subparagraph (A), by striking 
                        ``and'' at the end;
                            (ii) by redesignating subparagraph (B) as 
                        subparagraph (C); and
                            (iii) by inserting after subparagraph (A) 
                        the following:
                    ``(B) that is offering a specialized program for 
                the frail elderly (as defined in section 1853(i)(2)), 
                shall accept elections at any time for purposes of 
                enrolling frail elderly Medicare+Choice beneficiaries 
                (as defined in section 1853(i)(3)) in such program; 
                and''.
                    (B) Effectiveness of elections.--Section 1851(f)(4) 
                (42 U.S.C. 1395w-21(f)(4)) is amended by striking 
                ``subsection (e)(4)'' and inserting ``paragraph (4) or 
                (7) of subsection (e)''.
    (c) Development of Quality Measurement Program for Specialized 
Programs for the Frail Elderly.--Section 1852(e) (42 U.S.C. 1395w-
22(e)) is amended by adding at the end the following:
            ``(5) Quality measurement program for specialized programs 
        for the frail elderly as part of medicare+choice plans.--The 
        Secretary shall develop and implement a program to measure the 
        quality of care provided in specialized programs for the frail 
        elderly (as defined in section 1853(i)(2)) in order to reflect 
        the unique health aspects and needs of frail elderly 
        Medicare+Choice beneficiaries (as defined in section 
        1853(i)(3)). Such quality measurements may include indicators 
        of the prevalence of pressure sores, reduction of iatrogenic 
        disease, use of urinary catheters, use of antianxiety 
        medications, use of advance directives, incidence of pneumonia, 
        and incidence of congestive heart failure.''.
    (d) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall take effect on the date 
        of enactment of this Act.
            (2) Development of quality measurement program for 
        specialized programs for the frail elderly.--The Secretary of 
        Health and Human Services shall first provide for the 
        implementation of the quality measurement program for 
        specialized programs for the frail elderly under the amendment 
        made by subsection (c) by not later than July 1, 2000.

SEC. 808. EXTENSION OF MEDICARE COMMUNITY NURSING ORGANIZATION 
              DEMONSTRATION PROJECTS.

    Notwithstanding any other provision of law and in addition to the 
extension provided under section 4019 of the Balanced Budget Act of 
1997 (Public Law 105-33; 111 Stat. 347), demonstration projects 
conducted under section 4079 of the Omnibus Budget Reconciliation Act 
of 1987 (Public Law 100-203; 101 Stat. 1330-121) shall be conducted for 
an additional period of 3 years, and the deadline for any report 
required relating to the results of such projects shall be not later 
than 6 months before the end of such additional period.

                           TITLE IX--CLINICS

SEC. 901. NEW PROSPECTIVE PAYMENT SYSTEM FOR FEDERALLY-QUALIFIED HEALTH 
              CENTERS AND RURAL HEALTH CLINICS UNDER THE MEDICAID 
              PROGRAM.

    (a) In General.--Section 1902(a)(13) (42 U.S.C. 1396a(a)(13)) is 
amended--
            (1) in subparagraph (A), by adding ``and'' at the end;
            (2) in subparagraph (B), by striking ``and'' at the end; 
        and
            (3) by striking subparagraph (C).
    (b) New Prospective Payment System.--Section 1902 (42 U.S.C. 1396a) 
is amended by adding at the end the following:
    ``(aa) Payment for Services Provided by Federally-Qualified Health 
Centers and Rural Health Clinics.--
            ``(1) In general.--Beginning with fiscal year 2000 and each 
        succeeding fiscal year, the State plan shall provide for 
        payment for services described in section 1905(a)(2)(C) 
        furnished by a Federally-qualified health center and services 
        described in section 1905(a)(2)(B) furnished by a rural health 
        clinic in accordance with the provisions of this subsection.
            ``(2) Fiscal year 2000.--For fiscal year 2000, the State 
        plan shall provide for payment for such services in an amount 
        (calculated on a per visit basis) that is equal to 100 percent 
        of the costs of the center or clinic of furnishing such 
        services during fiscal year 1999 which are reasonable and 
        related to the cost of furnishing such services, or based on 
        such other tests of reasonableness as the Secretary prescribes 
        in regulations under section 1833(a)(3), or in the case of 
        services to which such regulations do not apply, the same 
        methodology used under section 1833(a)(3), adjusted to take 
        into account any increase in the scope of such services 
        furnished by the center or clinic during fiscal year 2000.
            ``(3) Fiscal year 2001 and succeeding years.--For fiscal 
        year 2001 and each succeeding fiscal year, the State plan shall 
        provide for payment for such services in an amount (calculated 
        on a per visit basis) that is equal to the amount calculated 
        for such services under this subsection for the preceding 
        fiscal year--
                    ``(A) increased by the percentage increase in the 
                MEI (medicare economic index) (as defined in section 
                1842(i)(3)) applicable to primary care services (as 
                defined in section 1842(i)(4)) for that fiscal year; 
                and
                    ``(B) adjusted to take into account any increase in 
                the scope of such services furnished by the center or 
                clinic during that fiscal year.
            ``(4) Establishment of initial year payment amount for new 
        centers or clinics.--In any case in which an entity first 
        qualifies as a Federally-qualified health center or rural 
        health clinic after October 1, 2000, the State plan shall 
        provide for payment for services described in section 
        1905(a)(2)(C) furnished by the center or services described in 
        section 1905(a)(2)(B) furnished by the clinic in the first 
        fiscal year in which the center or clinic qualifies in an 
        amount (calculated on a per visit basis) that is equal to 100 
        percent of the costs of furnishing such services during such 
        fiscal year in accordance with the regulations and methodology 
        referred to in paragraph (2). For each fiscal year following 
        the fiscal year in which the entity first qualifies as a 
        Federally-qualified health center or rural health clinic, the 
        State plan shall provide for the payment amount to be 
        calculated in accordance with paragraph (3) of this subsection.
            ``(5) Administration in the case of managed care.--In the 
        case of services furnished by a Federally-qualified health 
        center or rural health clinic pursuant to a contract between 
        the center or clinic and a managed care entity (as defined in 
        section 1932(a)(1)(B)), the State plan shall provide for 
        payment to the center or clinic (at least quarterly) by the 
        State of a supplemental payment equal to the amount (if any) by 
        which the amount determined under paragraphs (2), (3), and (4) 
        of this subsection exceeds the amount of the payments provided 
        under the contract.
            ``(6) Alternative payment system.--Notwithstanding any 
        other provision of this section, the State plan may provide for 
        payment in any fiscal year to a Federally-qualified health 
        center for services described in section 1905(a)(2)(C) or to a 
        rural health clinic for services described in section 
        1905(a)(2)(B) in an amount that is in excess of the amount 
        otherwise required to be paid to the center or clinic under 
        this subsection.''.
    (c) Conforming Amendments.--
            (1) Section 4712 of the Balanced Budget Act of 1997 (Public 
        Law 105-33; 111 Stat. 508) is amended by striking subsection 
        (c).
            (2) Section 1915(b) (42 U.S.C. 1396n(b)) is amended by 
        striking ``1902(a)(13)(E)'' and inserting ``1902(aa)''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on October 1, 1999.
                                 <all>