[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 980 Introduced in Senate (IS)]







106th CONGRESS
  1st Session
                                 S. 980

       To promote access to health care services in rural areas.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 6, 1999

   Mr. Baucus (for himself, Mr. Daschle, Mr. Thomas, Mr. Harkin, Mr. 
    Grassley, Mr. Conrad, Mr. Roberts, Mr. Frist, Mr. Johnson, Mr. 
Rockefeller, Mr. Jeffords, Mr. Wellstone, and Mr. Murkowski) introduced 
the following bill; which was read twice and referred to the Committee 
                               on Finance

_______________________________________________________________________

                                 A BILL


 
       To promote access to health care services in rural areas.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Promoting Health 
in Rural Areas Act of 1999''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
TITLE I--PROMOTING ACCESS TO HEALTH CARE SERVICES IN RURAL AREAS UNDER 
                          THE MEDICARE PROGRAM

                Subtitle A--Hospital-Related Provisions

Sec. 101. Sole community hospitals.
Sec. 102. Revision of criteria for designation as a critical access 
                            hospital.
Sec. 103. Graduate medical education technical amendments.
Sec. 104. Medicare-dependent small rural hospitals.
Sec. 105. All-inclusive payment option for outpatient critical access 
                            hospital services.
Sec. 106. Exclusion of swing beds in critical access hospitals from PPS 
                            for SNFs.
Sec. 107. Exclusion of small rural providers from PPS for hospital 
                            outpatient department services.
Sec. 108. Modification of DSH.
Sec. 109. Hospital geographic reclassification for labor costs for all 
                            items and services reimbursed under 
                            prospective payment systems.
Sec. 110. Requirement that wage levels for hospitals be standardized 
                            with respect to occupational mix before 
                            adjusting payment rates; study and report.
                     Subtitle B--General Provisions

Sec. 121. Payments to Medicare+Choice organizations.
Sec. 122. Direct billing of medicare, medicaid, and other third-party 
                            payors by Indian tribes and Alaska Native 
                            and tribal organizations.
Sec. 123. Additional duties for MedPAC and rural representation on 
                            MedPAC.
Sec. 124. Coverage of qualified mental health professional services 
                            under medicare.
Sec. 125. Study and report regarding barriers that individuals residing 
                            in rural areas face in obtaining quality 
                            mental health services.
Sec. 126. Medicare waivers for providers in rural areas.
Sec. 127. Revision of per-visit payment limits for rural health clinic 
                            services.
Sec. 128. Expansion of additional payments for services furnished in 
                            health professional shortage areas.
Sec. 129. Authority to establish a prospective payment system for RHC 
                            services.
Sec. 130. Separate wage indexes for making adjustments to payments 
                            under the prospective payment systems for 
                            skilled nursing facilities and home health 
                            agencies.
Sec. 131. Requirement to consider rural issues in establishing fee 
                            schedule for ambulance services.
    TITLE II--ADDITIONAL PROVISIONS TO ADDRESS SHORTAGES OF HEALTH 
                      PROFESSIONALS IN RURAL AREAS

Sec. 201. Health professional shortage areas.
Sec. 202. Exclusion of certain amounts received under the National 
                            Health Service Corps Scholarship Program.
Sec. 203. Designation of underserved areas under health care contracts 
                            administered by the Office of Personnel 
                            Management.
Sec. 204. New prospective payment system for Federally-qualified health 
                            centers and rural health clinics under the 
                            medicaid program.
Sec. 205. Revision and clarification of medicare reimbursement of 
                            telehealth services.
Sec. 206. Study and reports to Congress regarding telehealth licensure.
Sec. 207. Joint working group on telehealth.
             TITLE III--DEVELOPMENT OF TELEHEALTH NETWORKS

             Subtitle A--Development of Telehealth Networks

Sec. 301. Financial assistance authorized.
Sec. 302. Financial assistance described.
Sec. 303. Eligible telehealth networks.
Sec. 304. Use of financial assistance.
Sec. 305. Application.
Sec. 306. Approval of application.
Sec. 307. Administration.
Sec. 308. Regulations.
Sec. 309. Authorization of appropriations.
Subtitle B--Rural Health Outreach and Network Development Grant Program

Sec. 315. Rural health outreach and network development grant program.
                   TITLE IV--MISCELLANEOUS PROVISIONS

Sec. 401. Bank deductibility of small, tax-exempt debts.
Sec. 402. Access to data.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Rural communities have long had great difficulty 
        recruiting and retaining health care providers to serve the 
        needs of their residents.
            (2) Despite great increases in the production of providers 
        in this country (the number of individuals per physician fell 
        from 724 in 1965 to 375 in 1995), individuals living in rural 
        areas have not shared equitably in the benefits of this 
        expansion.
            (3) Over 73 percent of Americans live in non-metropolitan 
        counties, but only 11 percent of patient care physicians 
        practice in those counties, and this proportion has been 
        falling for the last 25 years.
            (4) The following conditions are characteristic of rural 
        populations:
                    (A) The relative lack of health care resources as 
                compared to urban areas.
                    (B) The uneven pattern of disease burden.
                    (C) The irregular distribution of programs and 
                resources resulting from policy variations across the 
                Nation.

TITLE I--PROMOTING ACCESS TO HEALTH CARE SERVICES IN RURAL AREAS UNDER 
                          THE MEDICARE PROGRAM

                Subtitle A--Hospital-Related Provisions

SEC. 101. SOLE COMMUNITY HOSPITALS.

    (a) In General.--Section 1886(b)(3)(C) of the Social Security Act 
(42 U.S.C. 1395ww(b)(3)(C)) is amended--
            (1) in clause (i), by redesignating subclauses (I) and (II) 
        as items (aa) and (bb), respectively;
            (2) by redesignating clauses (i), (ii), (iii), and (iv) as 
        subclauses (I), (II), (III), and (IV), respectively;
            (3) by striking ``(C) In'' and inserting ``(C)(i) Subject 
        to clause (ii), in'';
            (4) in the last sentence, by striking ``clause (i)'' and 
        inserting ``subclause (I)''; and
            (5) by inserting at the end the following:
    ``(ii)(I) If 1 or more of the alternative target amounts determined 
under subclause (II) for discharges occurring in fiscal year 2001 is 
greater than the target amount determined under clause (i) for such 
discharges, clause (i) shall be applied for such discharges by using 
the greatest of such alternative target amounts (and such amount shall 
be used in applying clause (i)(IV) to subsequent fiscal years).
    ``(II) The alternative target amounts are the amounts equal to the 
allowable operating costs of inpatient hospital services (as defined in 
subsection (a)(4)) recognized under this title for the hospital's cost 
reporting period (if any) beginning in each of the alternative base 
years, increased (in a compounded manner) by the applicable percentage 
increases applied to the hospital under this paragraph for discharges 
occurring in fiscal years beginning after the alternative base year and 
before fiscal year 2001.
    ``(III) The alternative base years are fiscal years 1982, 1987, 
1996, and 1997.''.
    (b) Eligibility for Geographic Reclassification Without Regard to 
Wage Index Threshold.--
            (1) In general.--Section 1886(d)(10)(D)(iii) of the Social 
        Security Act (42 U.S.C. 1395ww(d)(10)(D)(iii)) is amended by 
        inserting ``or a sole community hospital under paragraph 
        (5)(D)'' after ``a rural referral center under paragraph 
        (5)(C)''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall take effect on January 1, 2000, and apply with respect to 
        applications submitted for geographic reclassification for cost 
        reporting periods beginning on or after such date.

SEC. 102. REVISION OF CRITERIA FOR DESIGNATION AS A CRITICAL ACCESS 
              HOSPITAL.

    (a) Conversion of Downsized or Recently Closed Hospitals to 
Critical Access Hospitals.--Section 1820(c)(2) of the Social Security 
Act (42 U.S.C. 1395i-4(c)(2)) is amended--
            (1) in subparagraph (A), by striking ``subparagraph (B)'' 
        and inserting ``subparagraphs (B), (C), and (D)''; and
            (2) by adding at the end the following:
                    ``(C) Recently closed facilities.--A State may 
                designate a facility as a critical access hospital if 
                the facility--
                            ``(i) was a nonprofit or public hospital 
                        that ceased operations within the 3-year period 
                        ending on the date of enactment of the 
                        Promoting Health in Rural Areas Act of 1999; 
                        and
                            ``(ii) as of the effective date of such 
                        designation, meets the criteria for designation 
                        under subparagraph (B).
                    ``(D) Downsized facilities.--A State may designate 
                a health clinic or a health center (as defined by the 
                State) as a critical access hospital if such clinic or 
                center--
                            ``(i) is licensed by the State as a health 
                        clinic or a health center;
                            ``(ii) was a nonprofit or public hospital 
                        that was downsized to a health clinic or health 
                        center; and
                            ``(iii) as of the effective date of such 
                        designation, meets the criteria for designation 
                        under subparagraph (B).''.
    (b) Criteria for Designation.--Section 1820(c)(2)(B)(iii) of the 
Social Security Act (42 U.S.C. 1395i-4(c)(2)(B)(iii)) is amended by 
striking ``to exceed 96 hours'' and inserting ``to exceed, on average, 
96 hours per patient''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

SEC. 103. GRADUATE MEDICAL EDUCATION TECHNICAL AMENDMENTS.

    (a) Indirect Graduate Medical Education Adjustment.--
            (1) In general.--Section 1886(d)(5)(B)(v) of the Social 
        Security Act (42 U.S.C. 1395ww(d)(5)(B)(v)) is amended--
                    (A) by striking ``(v) In determining'' and 
                inserting ``(v)(I) Subject to subclause (II), in 
                determining'';
                    (B) 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
                    (C) 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).''.
            (2) Additional technical amendments.--Section 1886(d)(5)(B) 
        of the Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) is 
        amended by moving clauses (ii), (v), and (vi) 2 ems to the 
        left.
    (b) Direct Graduate Medical Education Adjustment.--
            (1) Limitation on number of residents.--Section 
        1886(h)(4)(F) of the Social Security Act (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 new programs.--The first sentence of 
        section 1886(h)(4)(H)(i) of the Social Security Act (42 U.S.C. 
        1395ww(h)(4)(H)(i)) is amended by inserting ``and before 
        September 30, 1999'' after ``January 1, 1995''.
            (3) Funding for programs meeting rural needs.--The second 
        sentence of section 1886(h)(4)(H)(i) of the Social Security Act 
        (42 U.S.C. 1395ww(h)(4)(H)(i)) is amended by striking the 
        period at the end and inserting ``, including facilities that 
        are not located in an underserved rural area but have 
        established separately accredited rural training tracks.''.
    (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.

SEC. 104. MEDICARE-DEPENDENT SMALL RURAL HOSPITALS.

    (a) Making Payment Provision Permanent.--Section 1886(d)(5)(G)(i) 
of the Social Security Act (42 U.S.C. 1395ww(d)(5)(G)(i)) is amended by 
striking ``and before October 1, 2001,''.
    (b) Option To Base Eligibility on Discharges During Any of the 3 
Most Recent Audited Cost Reporting Periods.--Section 
1886(d)(5)(G)(iv)(IV) of the Social Security Act (42 U.S.C. 
1395ww(d)(5)(G)(iv)(IV)) is amended by inserting ``, or any of the 3 
most recent audited cost reporting periods,'' after ``1987''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to discharges occurring on or after October 1, 1999.

SEC. 105. ALL-INCLUSIVE PAYMENT OPTION FOR OUTPATIENT CRITICAL ACCESS 
              HOSPITAL SERVICES.

    (a) In General.--Section 1834(g) of the Social Security 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 shall be determined by using 1 of the 2 following 
methods, as elected by the critical access hospital:
            ``(1) Cost-based facility fee plus professional charges.--
                    ``(A) Facility fee.--With respect to facility 
                services, not including any services for which payment 
                may be made under subparagraph (B), there shall be paid 
                amounts equal to the reasonable costs of the critical 
                access hospital in providing such services, less the 
                amount that such hospital may charge as described in 
                section 1866(a)(2)(A).
                    ``(B) Reasonable charges for professional 
                services.--In electing treatment under this paragraph, 
                payment for professional medical services otherwise 
                included within outpatient critical access hospital 
                services shall be made under such other provisions of 
                this part as would apply to payment for such services 
                if they were not included in outpatient critical access 
                hospital services.
            ``(2) All-inclusive rate.--With respect to both facility 
        services and professional medical services, there shall be paid 
        amounts equal to the reasonable costs of the critical access 
        hospital in providing such services, less the amount that such 
        hospital may charge as described in section 1866(a)(2)(A).
The amount of payment shall be determined under either method without 
regard to the amount of the customary or other charge.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect as if included in the enactment of the Balanced Budget Act 
of 1997.

SEC. 106. EXCLUSION OF SWING BEDS IN CRITICAL ACCESS HOSPITALS FROM 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.

SEC. 107. EXCLUSION OF SMALL RURAL PROVIDERS FROM PPS FOR HOSPITAL 
              OUTPATIENT DEPARTMENT SERVICES.

    (a) In General.--Section 1833(t)(1) of the Social Security Act (42 
U.S.C. 1395l(t)(1)) is amended--
            (1) in subparagraph (B), by striking ``For purposes of 
        this'' and inserting ``Subject to subparagraph (C), for 
        purposes of this''; and
            (2) by adding at the end the following:
            ``(C) Exclusion for services furnished by small rural 
        providers.--The term `covered OPD services' does not include 
        services furnished by a--
                    ``(i) medicare-dependent, small rural hospital, as 
                defined in section 1886(d)(5)(G)(iv);
                    ``(ii) a critical access hospital, as defined in 
                section 1861(mm)(1); or
                    ``(iii) sole community hospital, as defined in 
                section 1886(d)(5)(D)(iii);
        if such hospital, within the 180-day period beginning on the 
        date of enactment of the Promoting Health in Rural Areas Act of 
        1999, requests the Secretary to exclude services furnished by 
        such hospital from the prospective payment system established 
        under this subsection.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to payments for covered OPD services furnished on or after 
January 1, 2000.

SEC. 108. MODIFICATION OF DSH.

    (a) Collection of Charge Data.--Section 1886(d)(5)(F) of the Social 
Security Act (42 U.S.C. 1395ww(d)(5)(F)) is amended by adding at the 
end the following:
    ``(x) The Secretary shall collect from all subsection (d) hospitals 
annual data on inpatient and outpatient charges, including all such 
charges for each of the following categories:
            ``(I) All patients.
            ``(II) Patients who are eligible for benefits (excluding 
        any State supplementation) under the supplemental security 
        income program under title XVI and entitled to benefits under 
        part A.
            ``(III) Patients who are entitled to (or, if they applied, 
        would be eligible for) medical assistance under title XIX.
            ``(IV) Patients who are beneficiaries of indigent care 
        programs sponsored by State or local governments.
            ``(V) To the extent that payment is not made by patients, 
        such charges.
In collecting the data for patients described in subclause (II), the 
Secretary may estimate the charges for such patients based on 
supplemental security income program data from other sources and from 
the data collected for patients described in subclause (I).''.
    (b) Revision of Formula for Disproportionate Patient Percentage.--
Section 1886(d)(5)(F)(vi) of the Social Security Act (42 U.S.C. 
1395ww(d)(5)(F)(vi)) is amended to read as follows:
    ``(vi) In this subparagraph, the term `disproportionate patient 
percentage' means, with respect to a cost reporting period of a 
hospital--
            ``(I) the charges described in subclauses (II) through (V) 
        of clause (x) for such period; divided by
            ``(II) the charges described in clause (x)(I) for such 
        period.''.
    (c) Establishing General Qualifying Disproportionate Patient 
Percentage Threshold To Cover Half of PPS Hospitals.--Section 
1886(d)(5)(F)(v) of the Social Security Act (42 U.S.C. 
1395ww(d)(5)(F)(v)) is amended by striking ``equals, or exceeds--'' and 
all that follows and inserting ``equals or exceeds a threshold 
percentage, which is established by the Secretary in a manner so that, 
if the amendments to this subparagraph made by section 108 of the 
Promoting Health in Rural Areas Act of 1999 had been in effect for cost 
reporting periods ending in fiscal year 2000, 50 percent of subsection 
(d) hospitals would have been eligible for an additional payment under 
this subparagraph for such periods. The Secretary shall establish such 
threshold percentage based upon data collected by the Secretary under 
clause (x) for such cost reporting periods.''.
    (d) Establishing Uniform General Payment Formula.--Section 
1886(d)(5)(F) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(F)) is 
amended--
            (1) in clause (iv), by striking ``that is not described in 
        clause (i)(II) and that--'' and all that follows and inserting 
        ``described in clause (i) is equal to (P-T)(CF), where--
            ``(I) `P' is the hospital's disproportionate patient 
        percentage (as defined in clause (vi));
            ``(II) `T' is equal to the threshold percentage established 
        by the Secretary under clause (v); and
            ``(III) `CF' is equal to such conversion factor as the 
        Secretary may establish so that, applying such conversion 
        factor as if the amendments to this subparagraph made by 
        section 108 of the Promoting Health in Rural Areas Act of 1999 
        had been in effect for cost reporting periods ending in fiscal 
        year 2000, the total of the additional payments that would have 
        been made under this subparagraph is equal to the total of the 
        payments actually made under this subparagraph (not taking into 
        account such amendments).
The Secretary shall establish the conversion factor under subclause 
(III) based upon data collected by the Secretary under clause (x) for 
cost reporting periods ending in fiscal year 2000.'';
            (2) by amending clause (i) to read as follows:
    ``(i) The Secretary shall provide, in accordance with this 
subparagraph, for an additional payment amount for each subsection (d) 
hospital which serves a significantly disproportionate number of low-
income patients (as defined in clause (v)).'';
            (3) in clause (ii), by striking ``clause (iii) or (iv)'' 
        and inserting ``clause (iv)''; and
            (4) by striking clauses (iii), (vii), and (viii).
    (e) Effective Date.--The amendments made by this section apply to 
payments for discharges occurring on or after January 1, 2001.

SEC. 109. HOSPITAL GEOGRAPHIC RECLASSIFICATION FOR LABOR COSTS FOR ALL 
              ITEMS AND SERVICES REIMBURSED UNDER PROSPECTIVE PAYMENT 
              SYSTEMS.

    (a) In General.--Section 1886 of the Social Security Act (42 U.S.C. 
1395ww) is amended by adding at the end the following:
    ``(l) Application of Hospital Geographic Reclassification for 
Inpatient Services to All Hospital Furnished Items and Services 
Reimbursed Under Prospective Payment System.--
            ``(1) In general.--In the case of a hospital with an 
        application approved by the Medicare Geographic Classification 
        Review Board under subsection (d)(10)(C) to change the 
        hospital's geographic classification for a fiscal year for 
        purposes of the factor used to adjust the DRG 
prospective payment rate for area differences in hospital wage levels 
that applies to such hospital under subsection (d)(3)(E), the change in 
the hospital's geographic classification for such purposes shall apply 
for purposes of adjustments to payments for variations in costs which 
are attributable to wages and wage-related costs for all pps-reimbursed 
items and services.
            ``(2) PPS-reimbursed items and services defined.--For 
        purposes of paragraph (1), the term `pps-reimbursed items and 
        services' means, for cost reporting periods beginning during 
        the fiscal year for which such change has been approved, items 
        and services furnished by the hospital, or by an entity or 
        department of the hospital which is provider-based (as 
        determined by the Secretary), for which payments--
                    ``(A) are made under the prospective payment system 
                for hospital outpatient department services under 
                section 1833(t); and
                    ``(B) are adjusted for variations in costs which 
                are attributable to wages and wage-related costs.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to items and services furnished on or after January 1, 2000.

SEC. 110. REQUIREMENT THAT WAGE LEVELS FOR HOSPITALS BE STANDARDIZED 
              WITH RESPECT TO OCCUPATIONAL MIX BEFORE ADJUSTING PAYMENT 
              RATES; STUDY AND REPORT.

    (a) Occupational Mix.--
            (1) In general.--Section 1886(d)(3)(E) of the Social 
        Security Act (42 U.S.C. 1395ww(d)(3)(E)) is amended--
                    (A) in the first sentence, by inserting ``, but 
                only after such wage levels have been standardized with 
                respect to occupational mix'' before the period; and
                    (B) in the third sentence, by striking ``To the 
                extent determined feasible by the Secretary, such'' and 
                inserting ``Such''.
            (2) Effective date.--The amendments made by paragraph (1) 
        shall apply to adjustments made on or after October 1, 2002.
    (b) Study and Report.--
            (1) Study.--The Secretary of Labor shall conduct a study on 
        the feasibility and costs of having the Bureau of Labor 
        Statistics collect data on wages that would assist the 
        Secretary of Health and Human Services in determining (with 
        reasonable accuracy)--
                    (A) average wage levels, at the metropolitan 
                statistical area, statewide, and rural level, by--
                            (i) sector, including hospitals, skilled 
                        nursing facilities, home health agencies, and 
                        physicians' offices; and
                            (ii) occupational category within each 
                        sector; and
                    (B) the proportion of the workforce in each 
                occupational category within each sector.
            (2) Report.--Not later than June 1, 2000, the Secretary of 
        Labor shall submit a report to Congress on the study conducted 
        under paragraph (1), together with any recommendations that the 
        Secretary determines to be appropriate.

                     Subtitle B--General Provisions

SEC. 121. PAYMENTS TO MEDICARE+CHOICE ORGANIZATIONS.

    (a) Adjustment to Calculation of Annual Capitation Rates.--Section 
1853(c) of the Social Security Act (42 U.S.C. 1395w-23(c)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A), by striking the comma at 
                the end of clause (ii) and all that follows before the 
                period; and
                    (B) in subparagraph (C)(ii), by inserting 
                ``multiplied by the budget neutrality adjustment factor 
                determined under paragraph (5)'' before the period at 
                the end; and
            (2) in paragraph (5), by striking ``paragraph (1)(A)'' and 
        inserting ``paragraph (1)(C)(ii)''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to rates calculated for years after 2000.

SEC. 122. DIRECT BILLING OF MEDICARE, MEDICAID, AND OTHER THIRD-PARTY 
              PAYORS BY INDIAN TRIBES AND ALASKA NATIVE AND TRIBAL 
              ORGANIZATIONS.

    (a) Permanent Authorization.--The Indian Health Care Improvement 
Act (25 U.S.C. 1645) is amended by inserting the following after 
section 404:

``direct billing of medicare, medicaid, and other third-party payors by 
        indian tribes and alaska native and tribal organizations

    ``Sec. 405. (a) Establishment of Direct Billing Program.--
            ``(1) In general.--The Secretary shall establish a program 
        under which Indian tribes, tribal organizations, and Alaska 
        Native health organizations that contract or compact for the 
        operation of a hospital or clinic of the Service under the 
        Indian Self-Determination and Education Assistance Act may 
        elect to directly bill for, and receive payment for, health 
        care services provided by such hospital or clinic for which 
        payment is made under title XVIII of the Social Security Act 
        (42 U.S.C. 1395 et seq.) (in this section referred to as the 
        `medicare program'), under a State plan for medical assistance 
        approved under title XIX of the Social Security Act (42 U.S.C. 
        1396 et seq.) (in this section referred to as the `medicaid 
        program'), or from any other third-party payor.
            ``(2) Application of 100 percent fmap.--The third sentence 
        of section 1905(b) of the Social Security Act (42 U.S.C. 
        1396d(b)) shall apply for purposes of reimbursement under the 
        medicaid program for health care services directly billed under 
        the program established under this section.
    ``(b) Direct Reimbursement.--
            ``(1) Use of funds.--Each hospital or clinic participating 
        in the program described in subsection (a) of this section 
        shall be reimbursed directly under the medicare and medicaid 
        programs for services furnished, without regard to the 
        provisions of section 1880(c) of the Social Security Act (42 
        U.S.C. 1395qq(c)) and sections 402(a) and 813(b)(2)(A), but all 
funds so reimbursed shall first be used by the hospital or clinic for 
the purpose of making any improvements in the hospital or clinic that 
may be necessary to achieve or maintain compliance with the conditions 
and requirements applicable generally to facilities of such type under 
the medicare or medicaid programs. Any funds so reimbursed which are in 
excess of the amount necessary to achieve or maintain such conditions 
shall be used--
                    ``(A) solely for improving the health resources 
                deficiency level of the Indian tribe; and
                    ``(B) in accordance with the regulations of the 
                Service applicable to funds provided by the Service 
                under any contract entered into under the Indian Self-
                Determination Act (25 U.S.C. 450f et seq.).
            ``(2) Audits.--The amounts paid to the hospitals and 
        clinics participating in the program established under this 
        section shall be subject to all auditing requirements 
        applicable to programs administered directly by the Service and 
        to facilities participating in the medicare and medicaid 
        programs.
            ``(3) Secretarial oversight.--
                    ``(A) Quarterly reports.--Subject to subparagraph 
                (B), the Secretary shall monitor the performance of 
                hospitals and clinics participating in the program 
                established under this section, and shall require such 
                hospitals and clinics to submit reports on the program 
                to the Secretary on a quarterly basis during the first 
                2 years of participation in the program and annually 
                thereafter.
                    ``(B) Annual reports.--Any participant in the 
                demonstration program authorized under this section as 
                in effect on the day before the date of enactment of 
                the Promoting Health in Rural Areas Act of 1999 shall 
                only be required to submit annual reports under this 
                paragraph.
            ``(4) No payments from special funds.--Notwithstanding 
        section 1880(c) of the Social Security Act (42 U.S.C. 
        1395qq(c)) or section 402(a), no payment may be made out of the 
        special funds described in such sections for the benefit of any 
        hospital or clinic during the period that the hospital or 
        clinic participates in the program established under this 
        section.
    ``(c) Requirements for Participation.--
            ``(1) Application.--Except as provided in paragraph (2)(B), 
        in order to be eligible for participation in the program 
        established under this section, an Indian tribe, tribal 
        organization, or Alaska Native health organization shall submit 
        an application to the Secretary that establishes to the 
        satisfaction of the Secretary that--
                    ``(A) the Indian tribe, tribal organization, or 
                Alaska Native health organization contracts or compacts 
                for the operation of a facility of the Service;
                    ``(B) the facility is eligible to participate in 
                the medicare or medicaid programs under section 1880 or 
                1911 of the Social Security Act (42 U.S.C. 1395qq; 
                1396j);
                    ``(C) the facility meets the requirements that 
                apply to programs operated directly by the Service; and
                    ``(D) the facility is accredited by an accrediting 
                body designated by the Secretary or has submitted a 
                plan, which has been approved by the Secretary, for 
                achieving such accreditation.
            ``(2) Approval.--
                    ``(A) In general.--The Secretary shall review and 
                approve a qualified application not later than 90 days 
                after the date the application is submitted to the 
                Secretary unless the Secretary determines that any of 
the criteria set forth in paragraph (1) are not met.
                    ``(B) Grandfather of demonstration program 
                participants.--Any participant in the demonstration 
                program authorized under this section as in effect on 
                the day before the date of enactment of the Promoting 
                Health in Rural Areas Act of 1999 shall be deemed 
                approved for participation in the program established 
                under this section and shall not be required to submit 
                an application in order to participate in the program.
                    ``(C) Duration.--An approval by the Secretary of a 
                qualified application under subparagraph (A), or a 
                deemed approval of a demonstration program under 
                subparagraph (B), shall continue in effect as long as 
                the approved applicant or the deemed approved 
                demonstration program meets the requirements of this 
                section.
    ``(d) Examination and Implementation of Changes.--
            ``(1) In general.--The Secretary, acting through the 
        Service, and with the assistance of the Administrator of the 
        Health Care Financing Administration, shall examine on an 
        ongoing basis and implement--
                    ``(A) any administrative changes that may be 
                necessary to facilitate direct billing and 
                reimbursement under the program established under this 
                section, including any agreements with States that may 
                be necessary to provide for direct billing under the 
                medicaid program; and
                    ``(B) any changes that may be necessary to enable 
                participants in the program established under this 
                section to provide to the Service medical records 
                information on patients served under the program that 
                is consistent with the medical records information 
                system of the Service.
            ``(2) Accounting information.--The accounting information 
        that a participant in the program established under this 
        section shall be required to report shall be the same as the 
        information required to be reported by participants in the 
        demonstration program authorized under this section as in 
        effect on the day before the date of enactment of the Promoting 
        Health in Rural Areas Act of 1999. The Secretary may from time 
        to time, after consultation with the program participants, 
        change the accounting information submission requirements.
    ``(e) Withdrawal From Program.--A participant in the program 
established under this section may withdraw from participation in the 
same manner and under the same conditions that a tribe or tribal 
organization may retrocede a contracted program to the Secretary under 
authority of the Indian Self-Determination Act (25 U.S.C. 450 et seq.). 
All cost accounting and billing authority under the program established 
under this section shall be returned to the Secretary upon the 
Secretary's acceptance of the withdrawal of participation in this 
program.''.
    (b) Conforming Amendments.--
            (1) Section 1880 of the Social Security Act (42 U.S.C. 
        1395qq) is amended by adding at the end the following:
    ``(e) For provisions relating to the authority of certain Indian 
tribes, tribal organizations, and Alaska Native health organizations to 
elect to directly bill for, and receive payment for, health care 
services provided by a hospital or clinic of such tribes or 
organizations and for which payment may be made under this title, see 
section 405 of the Indian Health Care Improvement Act (25 U.S.C. 
1645).''.
            (2) Section 1911 of the Social Security Act (42 U.S.C. 
        1396j) is amended by adding at the end the following:
    ``(d) For provisions relating to the authority of certain Indian 
tribes, tribal organizations, and Alaska Native health organizations to 
elect to directly bill for, and receive payment for, health care 
services provided by a hospital or clinic of such tribes or 
organizations and for which payment may be made under this title, see 
section 405 of the Indian Health Care Improvement Act (25 U.S.C. 
1645).''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

SEC. 123. ADDITIONAL DUTIES FOR MEDPAC AND RURAL REPRESENTATION ON 
              MEDPAC.

    (a) Additional Duties.--Section 1805(b)(2) of the Social Security 
Act (42 U.S.C. 1395b-6(b)(2)) is amended by adding at the end the 
following:
                    ``(D) Medicare payments in rural areas.--
                Specifically, the Commission shall review--
                            ``(i) the impact that the prospective 
                        payment systems for skilled nursing facility 
                        services under section 1888(e), for home health 
                        services under section 1895, and for hospital 
                        outpatient department services under section 
                        1833(t) have on access to services in rural 
                        areas; and
                            ``(ii) the operating margins for hospitals 
                        located in rural or frontier areas.''.
    (b) Rural Representation.--Section 1805(c)(2)(A) of the Social 
Security Act (42 U.S.C. 1395b-6(c)(2)(A)) is amended by adding at the 
end the following: ``At least 2 of the members of the Commission shall 
be individuals who can represent the interests of rural health care 
providers and beneficiaries.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

SEC. 124. COVERAGE OF QUALIFIED MENTAL HEALTH PROFESSIONAL SERVICES 
              UNDER MEDICARE.

    (a) In General.--Section 1861(s)(2) of the Social Security Act (42 
U.S.C. 1395x(s)(2)) is amended--
            (1) in subparagraph (S), by striking ``and'' at the end;
            (2) in subparagraph (T), by striking the period at the end 
        and inserting ``; and''; and
            (3) by adding at the end the following:
            ``(U) qualified mental health professional services (as 
        defined in subsection (uu));''.
    (b) Payment Rules.--
            (1) Determination of amount of payment.--Section 1833(a)(1) 
        of the Social Security Act (42 U.S.C. 1395l(a)(1)) is amended--
                    (A) by striking ``and'' before ``(S)''; and
                    (B) by striking the semicolon at the end and 
                inserting the following: ``, and (T) with respect to 
                qualified mental health professional services described 
                in section 1861(s)(2)(U), the amounts paid shall be the 
                amount determined by a fee schedule established by the 
                Secretary for purposes of this subparagraph;''.
            (2) Separate payment for services
        of institutional providers.--Section 1832(a)(2)(B)(iii) of the 
        Social Security Act (42 U.S.C. 1395k(a)(2)(B)(iii)) is 
        amended--
                    (A) by striking ``and services'' and inserting 
                ``services''; and
                    (B) by striking the semicolon at the end and 
                inserting the following: ``, and qualified mental 
                health professional services described in section 
                1861(s)(2)(U);''.
    (c) Services Described.--Section 1861 of the Social Security Act 
(42 U.S.C. 1395x) is amended by adding at the end the following:

            ``Qualified Mental Health Professional Services

    ``(uu)(1) The term `qualified mental health professional services' 
means--
            ``(A) such services furnished (with such frequency limits 
        as the Secretary determines appropriate) to an eligible 
        individual by a mental health professional as the mental health 
        professional is legally authorized to perform under State law 
        (or under a State regulatory mechanism provided by State law) 
        of the State in which such services are performed; and
            ``(B) such services and supplies (with such limits) 
        furnished as an incident to services described in subparagraph 
        (A),
as would otherwise be covered if furnished by a physician (or as an 
incident to a physician's professional service).
    ``(2) In this subsection:
            ``(A) The term `eligible individual' means an individual 
        who resides in an area designated by the Secretary as a mental 
        health professional shortage area.
            ``(B) The term `mental health professional' means an 
        individual who--
                    ``(i) holds a master's or doctor's degree in the 
                field of mental health;
                    ``(ii) has at least 2 years of post-degree 
                supervised clinical experience; and
                    ``(iii) has been certified or licensed as a mental 
                health professional for the diagnosis and treatment of 
                mental illnesses by the State (or under the State 
                regulatory mechanism provided by State law) in which 
                the individual furnishes qualified mental health 
                professional services.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to services furnished on or after October 1, 1999.

SEC. 125. STUDY AND REPORT REGARDING BARRIERS THAT INDIVIDUALS RESIDING 
              IN RURAL AREAS FACE IN OBTAINING QUALITY MENTAL HEALTH 
              SERVICES.

    (a) Study.--The Secretary of Health and Human Services shall 
conduct a study on--
            (1) the barriers that beneficiaries under the medicare 
        program under title XVIII of the Social Security Act (42 U.S.C. 
        1395 et seq.) who reside in rural areas face in obtaining 
        quality mental health services; and
            (2) ways to reduce or eliminate such barriers.
    (b) Report.--Not later than January 1, 2001, the Secretary of 
Health and Human Services shall submit a report to Congress on the 
study conducted under subsection (a), together with any recommendations 
for legislation that the Secretary determines to be appropriate to 
reduce or eliminate the barriers described in subsection (a).

SEC. 126. MEDICARE WAIVERS FOR PROVIDERS IN RURAL AREAS.

    Notwithstanding section 1886(d)(2)(D) of the Social Security Act 
(42 U.S.C. 1395ww(d)(2)(D)), by not later than 180 days after the date 
of enactment of this Act, the Secretary of Health and Human Services 
shall establish a waiver process in which entities and individuals 
under the medicare program that are determined by the Office of 
Management and Budget to be located in an urban or large urban area for 
purposes of reimbursement under such program may apply to the Secretary 
to be considered to be located in a rural area for such purposes if 
such entity or individual is located--
            (1) in a rural area within a metropolitan county, as 
        defined by the most recent update of the Goldsmith 
        Modification; or
            (2) in a rural area as determined by using a census tract 
        definition of a rural area adopted by the Office of Rural 
        Health Policy in awarding grants.

SEC. 127. REVISION OF PER-VISIT PAYMENT LIMITS FOR RURAL HEALTH CLINIC 
              SERVICES.

    (a) In General.--Section 1833(f) of the Social Security Act (42 
U.S.C. 1395l(f)) is amended--
            (1) in paragraph (1), by striking ``and'' at the end;
            (2) in paragraph (2)--
                    (A) by striking ``in a subsequent year'' and 
                inserting ``in each of the years 1989 through 1999''; 
                and
                    (B) by striking the period at the end and inserting 
                a comma; and
            (3) by adding at the end the following:
            ``(3) in 2000, at an amount per visit that the Secretary 
        determines (by regulation) is reasonable and related to the 
        costs of furnishing rural health clinic services, but in no 
        case shall such amount be less than the limit applicable under 
        this subsection in 1999, and
            ``(4) in a subsequent year, at the limit established under 
        this subsection for the previous year--
                    ``(A) increased by the percentage increase in the 
                MEI (as defined in section 1842(i)(3)) applicable to 
                primary care services (as defined in section 
                1842(i)(4)) furnished as of the first day of that year; 
                and
                    ``(B) adjusted, as determined appropriate by the 
                Secretary, for changes in the scope of services that 
                rural health clinics are authorized to provide.
In determining the amount under paragraph (3), the Secretary shall use 
the fee schedule established under section 1848(b).''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to services furnished on or after January 1, 2000.

SEC. 128. EXPANSION OF ADDITIONAL PAYMENTS FOR SERVICES FURNISHED IN 
              HEALTH PROFESSIONAL SHORTAGE AREAS.

    (a) In General.--Section 1833(m) of the Social Security Act (42 
U.S.C. 1395l(m)) is amended--
            (1) by inserting ``(or services furnished by a physician 
        assistant or nurse practitioner that would be physicians' 
        services if furnished by a physician)'' after ``physicians' 
        services'';
            (2) by inserting ``or nurse practitioner'' after 
        ``physician''; and
            (3) by striking ``clause (A)'' and inserting 
        ``subparagraphs (A) and (C)''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to payments for services provided on or after January 1, 2000.

SEC. 129. AUTHORITY TO ESTABLISH A PROSPECTIVE PAYMENT SYSTEM FOR RHC 
              SERVICES.

    (a) Establishment of System.--Section 1833 of the Social Security 
Act (42 U.S.C. 1395l) is amended by adding at the end the following:
    ``(u) Authority To Establish Prospective Payment System for Rural 
Health Clinic Services.--
            ``(1) In general.--Notwithstanding subsections (a)(3) and 
        (f), the Secretary may establish by regulation a prospective 
        payment system for rural health clinic services (except for 
        such services provided by a rural health clinic located in a 
        rural hospital with less than 50 beds).
            ``(2) Budget neutral payments.--If the Secretary 
        establishes a prospective payment system pursuant to paragraph 
        (1), the Secretary shall establish the initial payment levels 
        under such system in a manner that results in aggregate 
        payments (including payments by individuals to whom services 
        are provided) for the first year, as estimated by the 
        Secretary, approximately equal to the aggregate payments that 
        would have otherwise been made under this part.''.
    (b) Conforming Amendments.--
            (1) Payment.--Section 1833(a)(3) of the Social Security Act 
        (42 U.S.C. 1395l(a)(3)) is amended by inserting ``subject to 
        subsection (u),'' before ``in the case''.
            (2) Limits.--Section 1833(f) of the Social Security Act (42 
        U.S.C. 1395l(f)) is amended by striking ``In establishing'' and 
        inserting ``Subject to subsection (u), in establishing''.
            (3) Requirement for rural health clinics.--Clause (ii) of 
        the second sentence of section 1861(aa)(2) of the Social 
        Security Act (42 U.S.C. 1395x(aa)(2)) is amended by inserting 
        ``(and section 1833(u) if the Secretary implements a 
        prospective payment system under that section)'' after 
        ``section 1833''.

SEC. 130. SEPARATE WAGE INDEXES FOR MAKING ADJUSTMENTS TO PAYMENTS 
              UNDER THE PROSPECTIVE PAYMENT SYSTEMS FOR SKILLED NURSING 
              FACILITIES AND HOME HEALTH AGENCIES.

    (a) Skilled Nursing Facility Prospective Payment System.--Section 
1888(e)(4)(G)(ii) of the Social Security Act (42 U.S.C. 
1395yy(e)(4)(G)(ii)) is amended by adding at the end the following: 
``Beginning in 2001, the area wage adjustment under this clause shall 
be based on the wages of individuals employed at skilled nursing 
facilities.''.
    (b) Home Health Prospective Payment System.--
            (1) In general.--Section 1895(b)(4)(C) of the Social 
        Security Act (42 U.S.C. 1395fff(b)(4)(C)) is amended by 
        striking the second sentence and inserting the following: 
        ``Such factors shall be based on the wages of individuals 
        employed at home health agencies.''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall take effect as if included in the enactment of the 
        Balanced Budget Act of 1997.

SEC. 131. REQUIREMENT TO CONSIDER RURAL ISSUES IN ESTABLISHING FEE 
              SCHEDULE FOR AMBULANCE SERVICES.

    (a) In General.--Section 1834(l)(2)(C) of the Social Security Act 
(42 U.S.C. 1395m(l)(2)(C)) is amended by inserting ``, including 
differences in rural and non-rural areas'' after ``differences''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect as if included in the enactment of the Balanced Budget Act 
of 1997.

    TITLE II--ADDITIONAL PROVISIONS TO ADDRESS SHORTAGES OF HEALTH 
                      PROFESSIONALS IN RURAL AREAS

SEC. 201. HEALTH PROFESSIONAL SHORTAGE AREAS.

    (a) In General.--Section 332 of the Public Health Service Act (42 
U.S.C. 254e) is amended--
            (1) in subsection (a)(1)(A), by inserting after 
        ``services)'' the following: ``, or a frontier area (as defined 
        by the Secretary),''; and
            (2) by adding at the end of subsection (c), the following:
            ``(3) Any pending retirements or resignations of physicians 
        available within the area involved. In implementing this 
        paragraph, the Secretary shall waive the requirements of this 
        section with respect to the number of physicians serving the 
        area for the 12-month period ending on the date on which the 
        retirement or resignation takes effect.''.
    (b) Development of Definition of Frontier.--For purposes of section 
332 of the Public Health Service Act (42 U.S.C. 254e) and for purposes 
of payment under title XVIII of the Social Security Act (42 U.S.C. 1395 
et seq.), the Secretary of Health and Human Services shall, by 
regulation, define the term ``frontier''. Such definition shall take 
into account population density and distance in miles, and time in 
minutes, to the nearest medical facility.
    (c) Requirements for Future Regulations Regarding the Designation 
of a HPSA.--The Secretary of Health and Human Services shall not 
implement any regulation that establishes a new methodology for 
designating an area as a health professional shortage area under 
section 332 of the Public Health Service Act (42 U.S.C. 254e) unless 
such methodology--
            (1) is not detrimental to underserved rural or frontier 
        communities, including that the methodology does not result in 
        the provision of fewer services in such communities; and
            (2) includes consideration of the percentage of the 
        population over the age of 65 years residing in an area.
    (d) Report to Congress.--Not later than January 1, 2001, the 
Secretary of Health and Human Services shall submit a report to 
Congress which contains a detailed description of--
            (1) the development of a definition of the term 
        ``frontier'' pursuant to subsection (b);
            (2) the impact that the use of such definition has on 
        Federal heath care programs; and
            (3) any recommendations that the Secretary determines to be 
        appropriate.
    (e) Effective Date.--The amendments made by subsection (a) shall 
take effect on the date of enactment of this Act.

SEC. 202. EXCLUSION OF CERTAIN AMOUNTS RECEIVED UNDER THE NATIONAL 
              HEALTH SERVICE CORPS SCHOLARSHIP PROGRAM.

    (a) In General.--Subsection (c) of section 117 of the Internal 
Revenue Code of 1986 (relating to the exclusion from gross income 
amounts received as a qualified scholarship) is amended--
            (1) by striking ``Subsections (a)'' and inserting the 
        following:
            ``(1) In general.--Subject to paragraph (2), subsections 
        (a)''; and
            (2) by adding at the end the following:
            ``(2) National health corps scholarship program.--Paragraph 
        (1) shall not apply to any amount received by an individual 
        under the National Health Corps Scholarship Program under 
        section 338A(g)(1)(A) of the Public Health Service Act.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to amounts received in taxable years beginning after December 31, 
1995.

SEC. 203. DESIGNATION OF UNDERSERVED AREAS UNDER HEALTH CARE CONTRACTS 
              ADMINISTERED BY THE OFFICE OF PERSONNEL MANAGEMENT.

    Section 8902(m)(2)(A) of title 5, United States Code, is amended by 
striking ``a State where 25 percent'' and all that follows through the 
period and inserting ``an area designated as a health professional 
shortage area by the Department of Health and Human Services in 
accordance with section 332 of the Public Health Service Act (42 U.S.C. 
254e).''.

SEC. 204. NEW PROSPECTIVE PAYMENT SYSTEM FOR FEDERALLY-QUALIFIED HEALTH 
              CENTERS AND RURAL HEALTH CLINICS UNDER THE MEDICAID 
              PROGRAM.

    (a) In General.--Section 1902(a)(13) of the Social Security Act (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 of the Social 
Security Act (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.''.
    (b) 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) of the Social Security Act (42 U.S.C. 
        1396n(b)) is amended by striking ``1902(a)(13)(E)'' and 
        inserting ``1902(aa)''.
    (c) Effective Date.--The amendments made by this section take 
effect on October 1, 1999.

SEC. 205. REVISION AND CLARIFICATION OF MEDICARE REIMBURSEMENT OF 
              TELEHEALTH SERVICES.

    (a) In General.--Section 4206(a) of the Balanced Budget Act of 1997 
(42 U.S.C. 1395l note) is amended to read as follows:
    ``(a) Reimbursement of Telehealth Services Authorized.--
            ``(1) In general.--Beginning on the date of enactment of 
        the Comprehensive Telehealth Act of 1999 and subject to 
        paragraph (3), the Secretary of Health and Human Services shall 
        make payments from the Federal Supplementary Medical Insurance 
        Trust Fund under part B of title XVIII of the Social Security 
        Act (42 U.S.C. 1395j et seq.) in accordance with the 
        methodology described in subsection (b) for items and services 
        for which payment may be made under such part that are provided 
        via telecommunications systems including store-and-forward 
        technologies (as defined in paragraph (2)) by a physician (as 
        defined in section 1861(r) of such Act (42 U.S.C. 1395x(r))) or 
        a practitioner (as defined in paragraph (2)) to a beneficiary 
        under the medicare program residing in a county in a rural area 
        (as defined in section 1886(d)(2)(D) of such Act (42 U.S.C. 
        1395ww(d)(2)(D))) notwithstanding that the physician or 
        practitioner providing the item or service via 
        telecommunication systems is not at the same location as the 
        medicare beneficiary.
            ``(2) Definitions.--
                    ``(A) Practitioner.--For purposes of paragraph (1), 
                the term `practitioner' includes--
                            ``(i) a practitioner described in section 
                        1842(b)(18)(C) of the Social Security Act (42 
                        U.S.C. 1395u(b)(18)(C)) (including a clinical 
                        psychologist); and
                            ``(ii) a physical, occupational, or speech 
                        therapist.
                    ``(B) Store-and-forward technologies.--For purposes 
                of paragraph (1), the term `store-and-forward 
                technologies' has the meaning given that term by the 
                Secretary, except that the term shall include 
                technologies through which information (including any 
                audio recording or visual image) is transferred and 
                stored for purposes of review by a health care provider 
                if the patient, the referring physician, or the health 
                care provider is not present at the time the 
                asynchronous review occurs at the remote site.
            ``(3) Rule of construction.--Nothing in this subsection 
        shall be construed as requiring payment for services provided 
        to a patient solely on the basis of information conveyed via 
        facsimile machine or via traditional telephone conversation.''.
    (b) Any Health Care Practitioner May Present Beneficiary to 
Consulting Physician.--Section 4206(b) of the Balanced Budget Act of 
1997 (42 U.S.C. 1395l note) is amended by adding at the end the 
following:
            ``(5) Any health care practitioner (whether or not such 
        practitioner is certified under the medicare program) that is 
        acting on instructions from the referring physician or 
        practitioner may present the beneficiary to the consulting 
        physician or practitioner for the provision of items and 
        services. The referring physician and the practitioner shall 
        not receive any reimbursement for such presentation other than 
        the payment that the referring physician receives pursuant to 
        paragraph (1).''.
    (c) All CPT Billing Codes Covered Under Telehealth Program.--
Section 4206 of the Balanced Budget Act of 1997 (42 U.S.C. 1395l note) 
is amended by adding at the end the following:
    ``(e) Coverage of Services.--Payment for items and services 
provided pursuant to subsection (a) shall include payment for all 
current procedural terminology billing codes that are covered under the 
medicare program under title XVIII of the Social Security Act (42 
U.S.C. 1395 et seq.).''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

SEC. 206. STUDY AND REPORTS TO CONGRESS REGARDING TELEHEALTH LICENSURE.

    (a) Study.--The Secretary shall conduct a study regarding--
            (1) the number, percentage, and types of health care 
        providers licensed to provide telehealth services across State 
        lines, including the number and types of health care providers 
        licensed to provide such services in more than 3 States;
            (2) the status of any reciprocal, mutual recognition, fast-
        track, or other licensure agreements between or among various 
        States;
            (3) the status of any efforts to develop uniform national 
        sets of standards for the licensure of health care providers to 
        provide telehealth services across State lines;
            (4) a projection of future utilization of telehealth 
        consultations across State lines;
            (5) State efforts to increase or reduce licensure as a 
        burden to interstate telehealth practice; and
            (6) any State licensure requirements that appear to 
        constitute unnecessary barriers to the provision of telehealth 
        services across State lines.
    (b) Reports to Congress.--
            (1) Initial report.--Not later than January 1, 2000, the 
        Secretary shall submit to the appropriate committees of 
        Congress a detailed report on the study conducted under 
        subsection (a).
            (2) Annual reports.--
                    (A) In general.--Not later than January 1, 2001, 
                and each January 1 thereafter, the Secretary shall 
                submit to the appropriate committees of Congress a 
                report on relevant developments regarding the matters 
                studied by the Secretary pursuant to subsection (a).
                    (B) Recommendations.--If, with respect to a report 
                submitted under subparagraph (A), the Secretary 
                determines that States are not making progress in 
                facilitating the provision of telehealth services 
                across State lines by eliminating unnecessary 
                requirements, adopting reciprocal licensing 
                arrangements for telehealth services, implementing 
                uniform requirements for telehealth licensure, or other 
                means, the Secretary shall include in the report 
                recommendations concerning the scope and nature of 
                Federal actions required to reduce licensure as a 
                barrier to the interstate provision of telehealth 
                services.

SEC. 207. JOINT WORKING GROUP ON TELEHEALTH.

    (a) In General.--
            (1) Redesignation.--The Joint Working Group on 
        Telemedicine, established by the Secretary, shall hereafter be 
        known as the ``Joint Working Group on Telehealth'' with the 
        chairperson being designated by the Director of the Office for 
        the Advancement of Telehealth.
            (2) Mission.--The mission of the Joint Working Group on 
        Telehealth is to--
                    (A) identify, monitor, and coordinate Federal 
                telehealth projects, data sets, and programs;
                    (B) analyze--
                            (i) how telehealth systems are expanding 
                        access to health care services, education, and 
                        information;
                            (ii) the clinical, educational, or 
                        administrative efficacy and cost-effectiveness 
                        of telehealth applications; and
                            (iii) the quality of the telehealth 
                        services delivered; and
                    (C) make further recommendations for coordinating 
                Federal and State efforts to increase access to health 
                care services, education, and information in rural and 
                underserved areas.
            (3) Annual reports.--Not later than January 1, 2000, and 
        annually thereafter, the Joint Working Group on Telehealth 
        shall report to Congress on the status of the Group's mission 
        and the state of the telehealth field generally.
    (b) Report Specifics.--The annual report required under subsection 
(a)(3) shall include--
            (1) an analysis of--
                    (A) the matters described in subsection (a)(2)(B);
                    (B) the Federal activities with respect to 
                telehealth; and
                    (C) the progress of the Joint Working Group on 
                Telehealth's efforts to coordinate Federal telehealth 
                programs; and
            (2) recommendations for a coordinated Federal strategy to 
        increase health care access through telehealth.
    (c) Termination.--The Joint Working Group on Telehealth shall 
terminate on the date that the Group submits the annual report that is 
due to be submitted on January 1, 2004, under subsection (a)(3).
    (d) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary for the Joint Working Group on 
Telehealth to carry out the purposes of this section.

             TITLE III--DEVELOPMENT OF TELEHEALTH NETWORKS

             Subtitle A--Development of Telehealth Networks

SEC. 301. FINANCIAL ASSISTANCE AUTHORIZED.

    (a) In General.--The Secretary, acting through the Director of the 
Office for Advancement of Telehealth, shall provide financial 
assistance (as described in section 302) to eligible telehealth 
networks (as described in section 303) for the purpose of expanding 
access to health care services for individuals in rural and frontier 
areas through the use of telehealth networks.
    (b) Maximum Amount of Financial Assistance.--The Secretary may 
establish the maximum amount of financial assistance made available to 
a recipient for each fiscal year under this title by publishing notice 
of such amount in the Federal Register or the Health Resources and 
Services Administration Preview.

SEC. 302. FINANCIAL ASSISTANCE DESCRIBED.

    (a) In General.--Financial assistance shall consist of loans (as 
described under subsection (b)), grants (as described under subsection 
(c)), or both as apportioned under subsection (d).
    (b) Loans.--
            (1) In general.--The Secretary is authorized to provide 
        loans to eligible telehealth networks under this title.
            (2) Maximum term of loans.--
                    (A) In general.--Subject to subparagraph (B), the 
                Secretary may establish the maximum term of any loan 
                provided under this title by publishing notice of such 
                term in the Federal Register or the Health Resources 
                and Services Administration Preview.
                    (B) Limitation.--The maximum term of any loan 
                provided under this title shall be for a period of not 
                more than 10 years.
            (3) Loan security and feasibility.--The Secretary shall 
        make a loan under this title only if the Secretary determines 
        that--
                    (A) the security for the loan is reasonably 
                adequate; and
                    (B) the loan will be repaid within the term of such 
                loan.
            (4) Loan forgiveness program.--
                    (A) Establishment.--With respect to loans provided 
                under this title, the Secretary shall establish a loan 
                forgiveness program under which recipients of such 
                loans may apply to have all or a portion of such loans 
                forgiven.
                    (B) Application.--
                            (i) In general.--Any recipient of a loan 
                        under this title that desires to have such loan 
                        forgiven under the program established under 
                        subparagraph (A) shall submit an application to 
                        the Secretary within 180 days of the end of the 
                        term of such loan, in such manner, and 
                        accompanied by such information as the 
                        Secretary may reasonably require.
                            (ii) Contents.--Each application submitted 
                        pursuant to clause (i) shall--
                                    (I) demonstrate that the recipient 
                                has a financial need for such 
                                forgiveness; and
                                    (II) demonstrate that the recipient 
                                has satisfied the quality and cost-
                                effectiveness criteria developed under 
                                subparagraph (C).
                    (C) Quality and cost-effectiveness criteria.--As 
                part of the program established under subparagraph (A), 
                the Secretary shall develop criteria for determining 
                the quality and cost-effectiveness of programs operated 
                with loans provided under this title.
    (c) Grants.--The Secretary is authorized to award grants to 
eligible telehealth networks under this title.
    (d) Apportionment.--
            (1) In general.--Subject to paragraph (2), the Secretary 
        shall determine what portion of the financial assistance 
        provided to an eligible telehealth network is a grant and what 
        portion of such financial assistance is a loan.
            (2) Requirements.--In determining the apportionment under 
        paragraph (1), the Secretary shall--
                    (A) ensure that the Federal Government receives the 
                maximum feasible repayment of the financial assistance 
                by basing such apportionment on the ability of the 
                recipient to repay a loan provided under this title; 
                and
                    (B) fully use the funds made available to carry out 
                this title.

SEC. 303. ELIGIBLE TELEHEALTH NETWORKS.

    (a) In General.--An entity that is a health care provider and a 
member of an existing or proposed telehealth network, or an entity that 
is a consortium of health care providers that are members of an 
existing or proposed telehealth network shall be eligible for financial 
assistance under this title.
    (b) Requirements.--
            (1) In general.--A telehealth network referred to in 
        subsection (a) shall, at a minimum, be composed of a 
        multispecialty entity (as defined in paragraph (2)(A)), a 
        network of community-based health care providers (as defined in 
        paragraph (2)(B)), and a public entity (as defined in paragraph 
        (2)(C)).
            (2) Definitions.--
                    (A) Multispecialty entity.--For purposes of 
                paragraph (1), the term ``multispecialty entity'' means 
                an entity which--
                            (i) provides 24-hour access to a range of 
                        diagnostic and therapeutic services; and
                            (ii) may be located in an urban area.
                    (B) Network of community-based health care 
                providers.--For purposes of paragraph (1), the term 
                ``network of community-based health care providers'' 
                means a network located in a rural area (as defined by 
                the Secretary) that includes at least 2 of the 
                following:
                            (i) A community or migrant health center.
                            (ii) A local health department.
                            (iii) A nonprofit or public hospital.
                            (iv) A health professional in private 
                        practice.
                            (v) A rural health clinic.
                            (vi) A skilled nursing facility.
                            (vii) A county mental health facility or 
                        other publicly funded mental health facility.
                            (viii) A provider of home health services.
                            (ix) Any other publicly funded health or 
                        social services agency.
                    (C) Public entity.--For purposes of paragraph (1), 
                the term ``public entity'' means an entity that 
                demonstrates its use of the telehealth network for 
                purposes of education and economic development (as 
                required by the Secretary), and includes--
                            (i) a public school;
                            (ii) a public library;
                            (iii) a college or university;
                            (iv) a local government entity; or
                            (v) a local business entity that is not 
                        related to the provision of health care 
                        services.
    (c) For-Profit Entity.--A telehealth network may include for-profit 
entities so long as the recipient of financial assistance under this 
title is a nonprofit entity.

SEC. 304. USE OF FINANCIAL ASSISTANCE.

    (a) Permitted Uses.--Any recipient of financial assistance under 
this title may use such financial assistance for the acquisition of 
telehealth equipment and modifications or improvements of telehealth 
services including--
            (1) the development and acquisition through lease or 
        purchase of computer hardware and software, audio and video 
        equipment, computer network equipment, interactive equipment, 
        data terminal equipment, or other equipment that would further 
        the purposes of this title;
            (2) the provision of technical assistance and instruction 
        for the development and use of such equipment;
            (3) the development and acquisition of instructional 
        programming;
            (4) demonstration projects for teaching or training medical 
        students, residents, and other students in health professions 
        in rural training sites regarding the application of 
        telehealth;
            (5) transmission costs, maintenance of equipment, 
        compensation of specialists, and referring health care 
        providers;
            (6) development of projects to use telehealth to facilitate 
        collaboration among health care providers;
            (7) electronic archival of patient records;
            (8) collection and analysis of usage statistics and data 
        that can be used to document the cost-effectiveness of the 
        telehealth services; or
            (9) such other uses that are consistent with achieving the 
        purposes of this title as approved by the Secretary.
    (b) Prohibited Uses.--Any recipient of financial assistance under 
this title may not use such financial assistance for the following 
purposes:
            (1) To build structures on or acquire real property, except 
        that such funds may be expended for minor renovations relating 
        to the installation of equipment.
            (2) To purchase or lease equipment to the extent the 
        expenditures would exceed more than 40 percent of the financial 
        assistance provided in the form of grants pursuant to section 
        302(c).
            (3) To purchase or install transmission equipment (such as 
        laying cable or telephone lines, microwave towers, amplifiers, 
        and digital switching equipment).
            (4) For indirect costs (as determined by the Secretary) to 
        the extent the expenditures would exceed more than 20 percent 
        of the financial assistance.

SEC. 305. APPLICATION.

    (a) In General.--Each eligible telehealth network that desires to 
receive financial assistance under this title, in consultation with the 
State office of rural health or other appropriate State agency, shall 
submit an application to the Secretary at such time, in such manner, 
and accompanied by such additional information as the Secretary may 
reasonably require.
    (b) Contents.--Each application submitted pursuant to subsection 
(a) shall include at least the following information:
            (1) A description of the anticipated need for financial 
        assistance.
            (2) A description of the activities which the entity 
        intends to carry out using the financial assistance provided 
        under this title.
            (3) A plan for continuing the project after financial 
        assistance provided under this title has ended.
            (4) A description of the manner in which the activities 
        funded by the financial assistance provided under this title 
        will meet health care needs of underserved rural populations 
        within the State.
            (5) A description of how the local community or region to 
        be served by the proposed telehealth network will be involved 
        in the development and ongoing operations of the telehealth 
        network.
            (6) A description of the source and amount of non-Federal 
        funds the entity would pledge for the project.
            (7) A description of the long-term viability of the project 
        and evidence of health care provider commitment to the 
        telehealth network.

SEC. 306. APPROVAL OF APPLICATION.

    (a) In General.--The Secretary shall approve applications in 
accordance with the criteria established in subsection (b) and the 
preferences described in subsection (c).
    (b) Criteria.--The Secretary shall not approve an application under 
this section unless the Secretary finds the following:
            (1) Expenditures in rural areas.--At least 50 percent of 
        the financial assistance is expended--
                    (A) in a rural area; or
                    (B) to provide services to residents of rural 
                areas.
            (2) Promotion of integration.--The application demonstrates 
        that the project will--
                    (A) promote the integration of telehealth in the 
                community;
                    (B) avoid redundancy of technology;
                    (C) achieve economies of scale; and
                    (D) coordinate telehealth services across different 
                networks within a geographic region.
    (c) Preferences.--In providing financial assistance under this 
title, the Secretary shall give preference to any applicant telehealth 
network that--
            (1) is a health care provider in a telehealth network or a 
        health care provider that proposes to form such a network, in 
        which the majority of the health care providers in such network 
        are located in an area that is designated by the Federal 
        Government or the State as--
                    (A) a medically underserved area; or
                    (B) a health, dental health, or mental health 
                professional shortage area;
            (2) proposes to use financial assistance provided under 
        this title to plan and establish telehealth networks that will 
        link rural hospitals and rural health care providers to other 
        hospitals, health care providers, and patients;
            (3) proposes to use financial assistance provided under 
        this title--
                    (A) to offer a range of health care applications; 
                and
                    (B) to promote greater efficiency in the use of 
                health care resources;
            (4) demonstrates financial, institutional, and community 
        support for the long-term viability of the telehealth network 
        through cost participation and other indicators determined by 
        the Secretary; and
            (5) demonstrates a detailed plan for coordinating 
        telehealth network use by eligible telehealth networks so that 
        health care services are given priority over services that are 
        not related to the provision of health care services.

SEC. 307. ADMINISTRATION.

    (a) Nonduplication.--The Secretary shall ensure that services and 
programs developed with financial assistance provided under this title 
do not duplicate established telehealth networks that adequately serve 
rural populations.
    (b) Coordination With Other Agencies.--The Secretary shall 
coordinate, to the extent practicable, with other Federal and State 
agencies with similar grant, loan, or other financial assistance 
programs to pool resources for funding meritorious proposals for the 
development of telehealth networks in rural areas.
    (c) Informational Efforts.--The Secretary shall establish and 
implement procedures to carry out informational efforts that notify 
potential applicants located in the rural areas of each State of the 
financial assistance available under this title.

SEC. 308. REGULATIONS.

    Not later than 180 days after the date of enactment of this Act, 
the Secretary shall by regulation prescribe such rules and regulations 
as the Secretary deems necessary to carry out the provisions of this 
title.

SEC. 309. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated to carry out this title, 
$40,000,000 for fiscal year 2000, and such sums as may be necessary for 
each of fiscal years 2001 through 2006.

Subtitle B--Rural Health Outreach and Network Development Grant Program

SEC. 315. RURAL HEALTH OUTREACH AND NETWORK DEVELOPMENT GRANT PROGRAM.

    (a) In General.--Section 330A of subpart I of part D of title III 
of the Public Health Service Act (42 U.S.C. 254c) is amended--
            (1) in the heading, by striking ``outreach, network, 
        development, and telemedicine'' and inserting ``outreach and 
        network development'';
            (2) in subsection (c)--
                    (A) in paragraph (1)(A)--
                            (i) by striking ``nonprofit private 
                        entity'' and inserting ``private nonprofit 
                        entity''; and
                            (ii) by striking ``three'' and inserting 
                        ``3'';
                    (B) in paragraph (2), by striking ``so long as'' 
                and inserting ``as long as''; and
                    (C) by striking paragraph (3); and
            (3) in subsection (e)--
                    (A) in paragraph (1), by striking ``Amounts'' and 
                inserting ``Subject to paragraphs (2) and (3), 
                amounts'';
                    (B) in paragraph (2)--
                            (i) by striking ``rural areas.--'' and all 
                        that follows through ``In awarding'' and 
                        inserting ``rural areas.--In awarding''; and
                            (ii) by striking subparagraph (B); and
                    (C) by striking paragraph (3) and inserting the 
                following:
            ``(3) Limitations.--An eligible network described in 
        subsection (c) may not use--
                    ``(A) more than 40 percent of the amounts provided 
                under a grant under this section to purchase equipment; 
                or
                    ``(B) any of the amounts provided under a grant 
                under this section--
                            ``(i) to build structures on or acquire 
                        real property; or
                            ``(ii) for construction.''.
    (b) Transition.--The Secretary of Health and Human Services shall 
ensure the continued funding of grants made, or contracts or 
cooperative agreements entered into, under subpart I of part D of title 
III of the Public Health Service Act (42 U.S.C. 254b et seq.) (as such 
subpart existed on the day prior to the date of enactment of this Act), 
until the expiration of the grant period or the term of the contract or 
cooperative agreement. Such funding shall be continued under the same 
terms and conditions as were in effect on the date on which the grant, 
contract, or cooperative agreement was awarded, subject to the 
availability of appropriations.

                   TITLE IV--MISCELLANEOUS PROVISIONS

SEC. 401. BANK DEDUCTIBILITY OF SMALL, TAX-EXEMPT DEBTS.

    (a) In General.--Section 265(b)(3) of the Internal Revenue Code of 
1986 (relating to exception for certain tax-exempt obligations) is 
amended by adding at the end the following:
                    ``(G) Election to apply limitation on amount of 
                obligations at borrower level.--
                            ``(i) In general.--An issuer, the proceeds 
                        of the obligations of which are to be used to 
                        make or finance eligible loans, may elect to 
                        apply subparagraphs (C) and (D) by treating 
                        each borrower as the issuer of a separate 
                        issue.
                            ``(ii) Eligible loan.--For purposes of this 
                        subparagraph--
                                    ``(I) In general.--The term 
                                `eligible loan' means 1 or more loans 
                                to a qualified borrower the proceeds of 
                                which are used by the borrower for 
                                health care or educational purposes and 
                                the outstanding balance of which issued 
                                during a calendar year does not exceed 
                                $5,000,000.
                                    ``(II) Qualified borrower.--The 
                                term `qualified borrower' means a 
                                borrower which is an organization 
                                described in section 501(c)(3) and 
                                exempt from taxation under section 
                                501(a).
                            ``(iii) Manner of election.--The election 
                        described in clause (i) may be made by an 
                        issuer for any calendar year at any time prior 
                        to its first issuance during such year of 
                        obligations the proceeds of which will be used 
                        to make or finance 1 or more eligible loans.
                            ``(iv) Modification of rule for composite 
                        issues.--In the case of an obligation which is 
                        issued by any issuer which has made the 
                        election described in clause (i), subparagraph 
                        (F) shall be applied without regard to clause 
                        (i) of such subparagraph.''
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to taxable years beginning after December 31, 1999.

SEC. 402. ACCESS TO DATA.

    (a) Requirement.--The heads of the agencies described in subsection 
(b) shall negotiate and enter into interagency agreements with agencies 
and offices of the Department of Health and Human Services under which 
such agencies and offices will be provided access to data sets for 
intramural and extramural research conducted or supported by such 
agencies or offices.
    (b) Agency Heads.--The agencies described in this section are the 
following:
            (1) The National Center for Health Statistics.
            (2) The Centers for Disease Control and Prevention.
            (3) The Agency for Health Care Policy and Research.
            (4) The Bureau of the Census.
    (c) Information.--The information that is to be made available 
under interagency agreements under this section shall include all 
information that is necessary for scholarly and policy research. Such 
information shall be made available in a manner that includes a 
description of the geographic area or location of the individuals who 
are the subject of such information.
    (d) Availability.--Information that is subject to an interagency 
agreement under this section shall be made available to bona fide 
researchers as determined appropriate by the Secretary of Health and 
Human Services.
    (e) Confidentiality.--Each interagency agreement entered into under 
this section shall contain provisions that protect the confidentiality 
of the individuals who are the subjects of such information.
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