[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 1589 Introduced in Senate (IS)]







107th CONGRESS
  1st Session
                                S. 1589

  To amend title XVIII of the Social Security Act to expand medicare 
  benefits to prevent, delay, and minimize the progression of chronic 
    conditions, establish payment incentives for furnishing quality 
 services to people with serious and disabling chronic conditions, and 
develop national policies on effective chronic condition care, and for 
                            other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            October 30, 2001

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

_______________________________________________________________________

                                 A BILL


 
  To amend title XVIII of the Social Security Act to expand medicare 
  benefits to prevent, delay, and minimize the progression of chronic 
    conditions, establish payment incentives for furnishing quality 
 services to people with serious and disabling chronic conditions, and 
develop national policies on effective chronic condition care, and for 
                            other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Medicare Chronic 
Care Improvement Act of 2001''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
  TITLE I--EXPANSION OF BENEFITS TO PREVENT, DELAY, AND MINIMIZE THE 
                   PROGRESSION OF CHRONIC CONDITIONS.

          Subtitle A--Improving Access to Preventive Services

Sec. 101. Definitions.
Sec. 102. Elimination of deductibles and coinsurance for existing 
                            preventive health benefits.
Sec. 103. Institute of Medicine medicare prevention benefit study and 
                            report.
Sec. 104. Authority to administratively provide for coverage of 
                            additional preventive benefits.
Sec. 105. Fast-track consideration of prevention benefit legislation.
      Subtitle B--Expansion of Access to Health Promotion Services

Sec. 111. Disease self-management demonstration projects.
Sec. 112. Medicare health education and risk appraisal program.
  Subtitle C--Medicare Coverage for Care Coordination and Assessment 
                                Services

Sec. 121. Care coordination and assessment services.
  TITLE II--PAYMENT INCENTIVES FOR QUALITY CARE FOR INDIVIDUALS WITH 
                SERIOUS AND DISABLING CHRONIC CONDITIONS

Sec. 201. Adjustments to fee-for-service payment systems.
Sec. 202. Medicare+Choice.
   TITLE III--DEVELOPMENT OF NATIONAL POLICIES ON EFFECTIVE CHRONIC 
                             CONDITION CARE

Sec. 301. Study and report on effective chronic condition care.
Sec. 302. Institute of Medicine medicare chronic condition care 
                            improvement study and report.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Secretary.--Unless otherwise specifically provided, the 
        term ``Secretary'' means the Secretary of Health and Human 
        Services.
            (2) Serious and disabling chronic condition.--The term 
        ``serious and disabling chronic condition'' means, with respect 
        to an individual, that the individual has at least one physical 
        or mental condition and a licensed health care practitioner has 
        certified within the preceding 12-month period that--
                    (A) the individual has a level of disability such 
                that the individual is unable to perform (without 
                substantial assistance from another individual) for a 
                period of at least 90 days due to a loss of functional 
                capacity--
                            (i) at least 2 activities of daily living; 
                        or
                            (ii) such number of instrumental activities 
                        of daily living that is equivalent (as 
                        determined by the Secretary) to the level of 
                        disability described in clause (i);
                    (B) the individual has a level of disability 
                equivalent (as determined by the Secretary) to the 
                level of disability described in subparagraph (A); or
                    (C) the individual requires substantial supervision 
                to protect the individual from threats to health and 
                safety due to severe cognitive impairment.
            (3) Activities of daily living.--The term ``activities of 
        daily living'' means each of the following:
                    (A) Eating.
                    (B) Toileting.
                    (C) Transferring.
                    (D) Bathing.
                    (E) Dressing.
                    (F) Continence.
            (4) Instrumental activities of daily living.--The term 
        ``instrumental activities of daily living'' means each of the 
        following:
                    (A) Medication management.
                    (B) Meal preparation.
                    (C) Shopping.
                    (D) Housekeeping.
                    (E) Laundry.
                    (F) Money management.
                    (G) Telephone use.
                    (H) Transportation use.

  TITLE I--EXPANSION OF BENEFITS TO PREVENT, DELAY, AND MINIMIZE THE 
                   PROGRESSION OF CHRONIC CONDITIONS.

          Subtitle A--Improving Access to Preventive Services

SEC. 101. DEFINITIONS.

    In this title:
            (1) Cost-effective benefit.--The term ``cost-effective 
        benefit'' means a benefit or technique that has--
                    (A) been subject to peer review;
                    (B) been described in scientific journals; and
                    (C) demonstrated value as measured by unit costs 
                relative to health outcomes achieved.
            (2) Cost-saving benefit.--The term ``cost-saving benefit'' 
        means a benefit or technique that has--
                    (A) been subject to peer review;
                    (B) been described in scientific journals; and
                    (C) caused a net reduction in health care costs for 
                medicare beneficiaries.
            (3) Medically effective.--The term ``medically effective'' 
        means, with respect to a benefit or technique, that the benefit 
        or technique has been--
                    (A) subject to peer review;
                    (B) described in scientific journals; and
                    (C) determined to achieve an intended goal under 
                normal programmatic conditions.
            (4) Medically efficacious.--The term ``medically 
        efficacious'' means, with respect to a benefit or technique, 
        that the benefit or technique has been--
                    (A) subject to peer review;
                    (B) described in scientific journals; and
                    (C) determined to achieve an intended goal under 
                controlled conditions.

SEC. 102. ELIMINATION OF DEDUCTIBLES AND COINSURANCE FOR EXISTING 
              PREVENTIVE HEALTH BENEFITS.

    (a) In General.--Section 1833 of the Social Security Act (42 U.S.C. 
1395l) is amended by inserting after subsection (o) the following new 
subsection:
    ``(p) Deductibles and Coinsurance Waived for Preventive Health 
Items and Services.--The Secretary shall not require the payment of any 
deductible or coinsurance under subsection (a) or (b), respectively, of 
any individual enrolled for coverage under this part for any of the 
following preventive health items and services:
            ``(1) Blood-testing strips, lancets, and blood glucose 
        monitors for individuals with diabetes described in section 
        1861(n).
            ``(2) Diabetes outpatient self-management training services 
        (as defined in section 1861(qq)(1)).
            ``(3) Pneumococcal, influenza, and hepatitis B vaccines and 
        administration described in section 1861(s)(10).
            ``(4) Screening mammography (as defined in section 
        1861(jj)).
            ``(5) Screening pap smear and screening pelvic exam (as 
        defined in paragraphs (1) and (2) of section 1861(nn), 
        respectively).
            ``(6) Bone mass measurement (as defined in section 
        1861(rr)(1)).
            ``(7) Prostate cancer screening test (as defined in section 
        1861(oo)(1)).
            ``(8) Colorectal cancer screening test (as defined in 
        section 1861(pp)(1)).
            ``(9) Screening for glaucoma (as defined in section 
        1861(uu)).
            ``(10) Medical nutrition therapy services (as defined in 
        section 1861(vv)(1)).''.
    (b) Waiver of Coinsurance.--
            (1) In general.--Section 1833(a)(1)(B) of the Social 
        Security Act (42 U.S.C. 1395l(a)(1)(B)) is amended to read as 
        follows: ``(B) with respect to preventive health items and 
        services described in subsection (p), the amounts paid shall be 
        100 percent of the fee schedule or other basis of payment under 
        this title for the particular item or service,''.
            (2) Elimination of coinsurance in outpatient hospital 
        settings.--The third sentence of section 1866(a)(2)(A) of the 
        Social Security Act (42 U.S.C. 1395cc(a)(2)(A)) is amended by 
        inserting after ``1861(s)(10)(A)'' the following: ``, 
        preventive health items and services described in section 
        1833(p),''.
    (c) Waiver of Application of Deductible.--Section 1833(b)(1) of the 
Social Security Act (42 U.S.C. 1395l(b)(1)) is amended to read as 
follows: ``(1) such deductible shall not apply with respect to 
preventive health items and services described in subsection (p),''.
    (d) Adding ``Lancet'' to Definition of DME.--Section 1861(n) of the 
Social Security Act (42 U.S.C. 1395x(n)) is amended by striking 
``blood-testing strips and blood glucose monitors'' and inserting 
``blood-testing strips, lancets, and blood glucose monitors''.
    (e) Conforming Amendments.--
            (1) Elimination of coinsurance for clinical diagnostic 
        laboratory tests.--Paragraphs (1)(D)(i) and (2)(D)(i) of 
        section 1833(a) of the Social Security Act (42 U.S.C. 
        1395l(a)), as amended by section 201(b)(1) of the Medicare, 
        Medicaid, and SCHIP Benefits Improvement and Protection Act of 
        2000 (114 Stat. 2763A-481), as enacted into law by section 
        1(a)(6) of Public Law 106-554, are each amended by inserting 
        ``or which are described in subsection (p)'' after 
        ``assignment-related basis''.
            (2) Elimination of coinsurance for certain dme.--Section 
        1834(a)(1)(A) of the Social Security Act (42 U.S.C. 
        1395m(a)(1)(A)) is amended by inserting ``(or 100 percent, in 
        the case of such an item described in section 1833(p))'' after 
        ``80 percent''.
            (3) Elimination of deductibles and coinsurance for 
        colorectal cancer screening tests.--Section 1834(d) of the 
        Social Security Act (42 U.S.C. 1395m(d)) is amended--
                    (A) in paragraph (2)(C)--
                            (i) by striking ``(C) Facility payment 
                        limit.--'' and all that follows through 
                        ``Notwithstanding subsections'' and inserting 
                        the following:
                    ``(C) Facility payment limit.--Notwithstanding 
                subsections'';
                            (ii) by striking ``(I) in accordance'' and 
                        inserting the following:
                            ``(i) in accordance'';
                            (iii) by striking ``(II) are performed'' 
                        and all that follows through ``payment under'' 
                        and inserting the following:
                            ``(ii) are performed in an ambulatory 
                        surgical center or hospital outpatient 
                        department,
                payment under''; and
                            (iv) by striking clause (ii); and
                    (B) in paragraph (3)(C)--
                            (i) by striking ``(C) Facility payment 
                        limit.--'' and all that follows through 
                        ``Notwithstanding subsections'' and inserting 
                        the following:
                    ``(C) Facility payment limit.--Notwithstanding 
                subsections''; and
                            (ii) by striking clause (ii).
    (f) Effective Date.--The amendments made by this section shall 
apply to services furnished on or after the day that is 1 year after 
the date of enactment of this Act.

SEC. 103. INSTITUTE OF MEDICINE MEDICARE PREVENTION BENEFIT STUDY AND 
              REPORT.

    (a) Study.--
            (1) In general.--The Secretary shall contract with the 
        Institute of Medicine of the National Academy of Sciences to--
                    (A) conduct a comprehensive study of current 
                literature and best practices in the field of health 
                promotion and disease prevention among medicare 
                beneficiaries, including the issues described in 
                paragraph (2); and
                    (B) submit the report described in subsection (b).
            (2) Issues studied.--The study required under paragraph (1) 
        shall include an assessment of--
                    (A) whether each health promotion and disease 
                prevention benefit covered under the medicare program 
                is--
                            (i) medically effective (as defined in 
                        section 101(3)); or
                            (ii) a cost-effective benefit (as defined 
                        in section 101(1)) or a cost-saving benefit (as 
                        defined in section 101(2));
                    (B) utilization by medicare beneficiaries of such 
                benefits (including any barriers to or incentives to 
                increase utilization);
                    (C) quality of life issues associated with such 
                benefits; and
                    (D) whether health promotion and disease prevention 
                benefits that are not covered under the medicare 
                program that would affect all medicare beneficiaries 
                are--
                            (i) likely to be medically effective (as 
                        defined in section 101(3)); or
                            (ii) likely to be a cost-effective benefit 
                        (as defined in section 101(1)) or a cost-saving 
                        benefit (as defined in section 101(2));
    (b) Reports.--
            (1) Three-year report.--On the date that is 3 years after 
        the date of enactment of this Act, and each successive 3-year 
        anniversary thereafter, the Institute of Medicine of the 
        National Academy of Sciences shall submit to the President a 
        report that contains--
                    (A) a detailed statement of the findings and 
                conclusions of the study conducted under subsection 
                (a); and
                    (B) the recommendations for legislation described 
                in paragraph (3).
            (2) Interim report based on new guidelines.--If the United 
        States Preventive Services Task Force or the Task Force on 
        Community Preventive Services establishes new guidelines 
        regarding preventive health benefits for medicare beneficiaries 
        more than 1 year prior to the date that a report described in 
        paragraph (1) is due to be submitted to the President, then not 
        later than 6 months after the date such new guidelines are 
        established, the Institute of Medicine of the National Academy 
        of Sciences shall submit to the President a report that 
        contains a detailed description of such new guidelines. Such 
        report may also contain recommendations for legislation 
        described in paragraph (3).
            (3) Recommendations for legislation.--The Institute of 
        Medicine of the National Academy of Sciences, in consultation 
        with the United States Preventive Services Task Force and the 
        Task Force on Community Preventive Services, shall develop 
        recommendations in legislative form that--
                    (A) prioritize the preventive health benefits under 
                the medicare program; and
                    (B) modify such benefits, including adding new 
                benefits under such program, based on the study 
                conducted under subsection (a).
    (c) Transmission to Congress.--
            (1) In general.--Subject to paragraph (2), on the day that 
        is 6 months after the date on which the report described in 
        paragraph (1) of subsection (b) (or paragraph (2) of such 
        subsection if the report contains recommendations in 
        legislative form described in subsection (b)(3)) is submitted 
        to the President, the President shall transmit the report and 
        recommendations to Congress.
            (2) Regulatory action by the secretary of health and human 
        services.--If the Secretary of Health and Human Services has 
        exercised the authority under section 104(a) to adopt by 
        regulation one or more of the recommendations under subsection 
        (b)(3), the President shall only submit to Congress those 
        recommendations under subsection (b)(3) that have not been 
        adopted by the Secretary.
            (3) Delivery.--Copies of the report and recommendations in 
        legislative form required to be transmitted to Congress under 
        paragraph (1) shall be delivered--
                    (A) to both Houses of Congress on the same day;
                    (B) to the Clerk of the House of Representatives if 
                the House is not in session; and
                    (C) to the Secretary of the Senate if the Senate is 
                not in session.

SEC. 104. AUTHORITY TO ADMINISTRATIVELY PROVIDE FOR COVERAGE OF 
              ADDITIONAL PREVENTIVE BENEFITS.

    (a) In General.--The Secretary of Health and Human Services may by 
regulation adopt any or all of the legislative recommendations 
developed by the Institute of Medicine of the National Academy of 
Sciences, in consultation with the United States Preventive Services 
Task Force and the Task Force on Community Preventive Services in a 
report under section 103(b)(3) (relating to prioritizing and modifying 
preventive health benefits under the medicare program and the addition 
of new preventive benefits), consistent with subsection (b).
    (b) Elimination of Cost-Sharing.--With respect to items and 
services furnished under the medicare program that the Secretary has 
incorporated by regulation under subsection (a), the provisions of 
section 1833(p) of  the Social Security Act (relating to elimination of 
cost-sharing for preventive benefits), as added by section 102(a), 
shall apply to those items and services in the same manner as such 
section applies to the items and services described in paragraphs (1) 
through (10) of such section.
    (c) Deadline.--The Secretary must publish a notice of rulemaking 
with respect to the adoption by regulation under subsection (a) of any 
such recommendation within 6 months of the date on which a report 
described in section 103(b) is submitted to the President.

SEC. 105. FAST-TRACK CONSIDERATION OF PREVENTION BENEFIT LEGISLATION.

    (a) Rules of House of Representatives and Senate.--This section is 
enacted by Congress--
            (1) as an exercise of the rulemaking power of the House of 
        Representatives and the Senate, respectively, and is deemed a 
        part of the rules of each House of Congress, but--
                    (A) is applicable only with respect to the 
                procedure to be followed in that House of Congress in 
                the case of an implementing bill (as defined in 
                subsection (d)); and
                    (B) supersedes other rules only to the extent that 
                such rules are inconsistent with this section; and
            (2) with full recognition of the constitutional right of 
        either House of Congress to change the rules (so far as 
        relating to the procedure of that House of Congress) at any 
        time, in the same manner and to the same extent as in the case 
        of any other rule of that House of Congress.
    (b) Introduction and Referral.--
            (1) Introduction.--
                    (A) In general.--Subject to paragraph (2), on the 
                day on which the President transmits the report 
                pursuant to section 103(c) to the House of 
                Representatives and the Senate, the recommendations in 
                legislative form transmitted by the President with 
                respect to such report shall be introduced as a bill 
                (by request) in the following manner:
                            (i) House of representatives.--In the House 
                        of Representatives, by the Majority Leader, for 
                        himself and the Minority Leader, or by Members 
                        of the House of Representatives designated by 
                        the Majority Leader and Minority Leader.
                            (ii) Senate.--In the Senate, by the 
                        Majority Leader, for himself and the Minority 
                        Leader, or by Members of the Senate designated 
                        by the Majority Leader and Minority Leader.
                    (B) Special rule.--If either House of Congress is 
                not in session on the day on which such recommendations 
                in legislative form are transmitted, the 
                recommendations in legislative form shall be introduced 
                as a bill in that House of Congress, as provided in 
                subparagraph (A), on the first day thereafter on which 
                that House of Congress is in session.
            (2) Referral.--Such bills shall be referred by the 
        presiding officers of the respective Houses to the appropriate 
        committee, or, in the case of a bill containing provisions 
        within the jurisdiction of 2 or more committees, jointly to 
        such committees for consideration of those provisions within 
        their respective jurisdictions.
    (c) Consideration.--After the recommendations in legislative form 
have been introduced as a bill and referred under subsection (b), such 
implementing bill shall be considered in the same manner as an 
implementing bill is considered under subsections (d), (e), (f), and 
(g) of section 151 of the Trade Act of 1974 (19 U.S.C. 2191).
    (d) Implementing Bill Defined.--In this section, the term 
``implementing bill'' means only the recommendations in legislative 
form of the Institute of Medicine of the National Academy of Sciences 
described in section 103(b)(3), transmitted by the President to the 
House of Representatives and the Senate under subsection 103(c), and 
introduced and referred as provided in subsection (b) as a bill of 
either House of Congress.
    (e) Counting of Days.--For purposes of this section, any period of 
days referred to in section 151 of the Trade Act of 1974 shall be 
computed by excluding--
            (1) the days on which either House of Congress is not in 
        session because of an adjournment of more than 3 days to a day 
        certain or an adjournment of Congress sine die; and
            (2) any Saturday and Sunday, not excluded under paragraph 
        (1), when either House is not in session.

      Subtitle B--Expansion of Access to Health Promotion Services

SEC. 111. DISEASE SELF-MANAGEMENT DEMONSTRATION PROJECTS.

    (a) Demonstration Projects.--
            (1) In general.--The Secretary shall conduct demonstration 
        projects for the purpose of promoting disease self-management 
        for conditions identified,  and appropriately prioritized, by 
the Secretary for target individuals (as defined in paragraph (2)).
            (2) Target individual defined.--In this section, the term 
        ``target individual'' means an individual who--
                    (A) is at risk for, or has, 1 or more of the 
                conditions identified by the Secretary as being 
                appropriate for disease self-management; and
                    (B) is entitled to benefits under part A of title 
                XVIII of the Social Security Act (42 U.S.C. 1395c et 
                seq.), or enrolled under part B of such title ( 42 
                U.S.C. 1395j et seq.) or is enrolled under the 
                Medicare+Choice program under part C of such title (42 
                U.S.C. 1395w-21 et seq.).
    (b) Number; Project Areas; Duration.--
            (1) Number.--Not later than 2 years after the date of 
        enactment of this Act, the Secretary shall implement a series 
        of demonstration projects to carry out the purpose described in 
        subsection (a)(1).
            (2) Project areas.--The Secretary shall implement the 
        demonstration projects described in paragraph (1) in urban, 
        suburban, and rural areas.
            (3) Duration.--The demonstration projects under this 
        section shall be conducted during the 3-year period beginning 
        on the date on which the initial demonstration project is 
        implemented.
    (c) Report to Congress.--
            (1) In general.--Not later than 18 months after the 
        conclusion of the demonstration projects under this section, 
        the Secretary shall submit a report to Congress on such 
        projects.
            (2) Contents of report.--The report required under 
        paragraph (1) shall include the following:
                    (A) A description of the demonstration projects.
                    (B) An evaluation of--
                            (i) whether each benefit provided under the 
                        demonstration projects is--
                                    (I) medically effective;
                                    (II) medically efficacious;
                                    (III) cost-effective; or
                                    (IV) cost-saving;
                            (ii) the level of the disease self-
                        management attained by target individuals under 
                        the demonstration projects; and
                            (iii) the satisfaction of target 
                        individuals under the demonstration projects.
                    (C) Recommendations of the Secretary regarding 
                whether to conduct the demonstration projects on a 
                permanent basis.
                    (D) Such recommendations for legislation and 
                administrative action as the Secretary determines to be 
                appropriate.
                    (E) Any other information regarding the 
                demonstration projects that the Secretary determines to 
                be appropriate.
    (d) Funding.--The Secretary shall provide for the transfer from the 
Federal Hospital Insurance Trust Fund under section 1817 of the Social 
Security Act (42 U.S.C. 1395i) an amount not to exceed $30,000,000 for 
the costs of carrying out this section.

SEC. 112. MEDICARE HEALTH EDUCATION AND RISK APPRAISAL PROGRAM.

    Title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) is 
amended by adding at the end the following new section:

         ``medicare health education and risk appraisal program

    ``Sec. 1897. (a) Establishment.--Not later than 18 months after the 
date of the conclusion of the demonstration projects conducted under 
subsection (b)(1), the Secretary shall establish a comprehensive and 
systematic model for delivering health promotion and disease prevention 
services that--
            ``(1) through self-assessment identifies--
                    ``(A) behavioral risk factors, such as tobacco use, 
                physical inactivity, alcohol use, depression, lack of 
                proper nutrition, and risk of falling, among target 
                individuals;
                    ``(B) needed medicare clinical preventive and 
                screening health benefits among target individuals; and
                    ``(C) functional and self-management information 
                the Secretary determines to be appropriate;
            ``(2) provides ongoing followup to reduce risk factors and 
        promote the appropriate use of preventive and screening health 
        benefits;
            ``(3) improves clinical outcomes, satisfaction, quality of 
        life, and appropriate use by target individuals of items and 
        services covered under the medicare program; and
            ``(4) provides target individuals with information 
        regarding the adoption of healthy behaviors.
    ``(b) Demonstration Projects.--
            ``(1) Establishment.--Not later than 1 year after the date 
        of enactment of this section, the Secretary, in consultation 
        with the Director of the Centers for Disease Control and 
        Prevention, and the Director of the Agency for Healthcare 
        Research and Quality, shall conduct demonstration projects for 
        the purpose of developing a comprehensive and systematic model 
        for delivering health promotion and disease prevention services 
        described in subsection (a).
            ``(2) Self-assessment and provision of information.--The 
        Secretary shall conduct the demonstration projects established 
        under paragraph (1) in the following manner:
                    ``(A) Self-assessment.--
                            ``(i) In general.--The Secretary shall test 
                        different--
                                    ``(I) methods of making self-
                                assessments available to each target 
                                individual;
                                    ``(II) methods of encouraging each 
                                target individual to participate in the 
                                self-assessment; and
                                    ``(III) methods for processing 
                                responses to the self-assessment.
                            ``(ii) Contents.--A self-assessment made 
                        available under clause (i) shall include--
                                    ``(I) questions regarding 
                                behavioral risk factors;
                                    ``(II) questions regarding needed 
                                preventive screening health services;
                                    ``(III) questions regarding the 
                                target individual's preferences for 
                                receiving follow-up information; and
                                    ``(IV) other information that the 
                                Secretary determines appropriate.
                    ``(B) Provision of information.--After each target 
                individual completes the self-assessment, the Secretary 
                shall ensure that the target individual is provided 
                with such information as the Secretary determines 
                appropriate, which may include--
                            ``(i) information regarding the results of 
                        the self-assessment;
                            ``(ii) recommendations regarding any 
                        appropriate behavior modification based on the 
                        self-assessment;
                            ``(iii) information regarding how to access 
                        behavior modification assistance that promotes 
                        healthy behavior, including information on 
                        nurse hotlines, counseling services, provider 
                        services, and case-management services;
                            ``(iv) information, feedback, support, and 
                        recommendations regarding any need for clinical 
                        preventive and screening health services or 
                        treatment; and
                            ``(v) referrals to available community 
                        resources in order to assist the target 
                        individual in reducing health risks.
            ``(3) Project areas and duration.--
                    ``(A) Project areas.--The Secretary shall implement 
                the demonstration projects in geographic areas that 
                include urban, suburban, and rural areas.
                    ``(B) Duration.--The Secretary shall conduct the 
                demonstration projects during the 3-year period 
                beginning on the date on which the first demonstration 
                project is implemented.
    ``(c) Report to Congress.--
            ``(1) In general.--Not later than 1 year after the date on 
        which the demonstration projects conclude, the Secretary shall 
        submit to Congress a report on such projects.
            ``(2) Contents of report.--The report submitted under 
        paragraph (1) shall--
                    ``(A) describe the demonstration projects conducted 
                under this section;
                    ``(B) identify the demonstration project that is 
                the most effective; and
                    ``(C) contain such other information regarding the 
                demonstration projects as the Secretary determines 
                appropriate.
            ``(3) Measurement of effectiveness.--For purposes of 
        paragraph (2)(B), in identifying the demonstration project that 
        is the most effective, the Secretary shall consider--
                    ``(A) how successful the project was at--
                            ``(i) reaching target individuals and 
                        engaging them in an assessment of the risk 
                        factors of such individuals;
                            ``(ii) educating target individuals on 
                        healthy behaviors and getting such individuals 
                        to modify their behaviors in order to diminish 
                        the risk of chronic disease; and
                            ``(iii) ensuring that target individuals 
                        were provided with necessary information;
                    ``(B) the cost-effectiveness of the demonstration 
                project; and
                    ``(C) the degree of beneficiary satisfaction under 
                the demonstration projects.
    ``(d) Waiver Authority.--The Secretary may waive such requirements 
under this title as the Secretary determines necessary to carry out the 
demonstration projects under this section.
    ``(e) Funding.--There are authorized to be appropriated $25,000,000 
to the Secretary for carrying out the demonstration projects under this 
section.
    ``(f) Definition of Target Individual.--The term `target 
individual' means each individual who is--
            ``(1) entitled to benefits under part A or enrolled under 
        part B, including an individual enrolled under the 
        Medicare+Choice program under part C; or
            ``(2) between the ages of 50 and 64 and who is not 
        described in paragraph (1).''.

  Subtitle C--Medicare Coverage for Care Coordination and Assessment 
                                Services

SEC. 121. CARE COORDINATION AND ASSESSMENT SERVICES.

    (a) Services Authorized.--Title XVIII of the Social Security Act 
(42 U.S.C. 1395 et seq.), as amended by section 112, is further amended 
by adding at the end the following new section:

              ``care coordination and assessment services

    ``Sec. 1898. (a) Purpose.--The purpose of this section is to 
provide assistance to a beneficiary with a serious and disabling 
chronic condition (as defined in subsection (f)(1)) to obtain the 
appropriate level and mix of follow-up care.
    ``(b) Election of Care Coordination and Assessment Services.--
            ``(1) In general.--On or after January 1, 2003, a 
        beneficiary with a serious and disabling chronic condition may 
        elect to receive care coordination services in accordance with 
        the provisions of this section under which, in appropriate 
        circumstances, the eligible beneficiary has health care 
        services covered under this title managed and coordinated by a 
        care coordinator who is qualified under subsection (e) to 
        furnish care coordination services under this section.
            ``(2) Revocation of election.--An eligible beneficiary who 
        has made an election under paragraph (1) may revoke that 
        election at any time.
    ``(c) Outreach.--The Secretary shall provide for the wide 
dissemination of information to beneficiaries and providers of 
services, physicians, practitioners, and suppliers  with respect to the 
availability of and requirements for care coordination services under 
this section.
    ``(d) Care Coordination and Assessment Services Described.--Care 
coordination services under this section shall include the following:
            ``(1) Basic care coordination and assessment services.--
                    ``(A) In general.--Except as otherwise provided in 
                this section, eligible beneficiaries who have made an 
                election under this section shall receive the following 
                services:
                            ``(i)(I) An initial assessment of an 
                        individual's medical condition, functional and 
                        cognitive capacity, and environmental and 
                        psychosocial needs.
                            ``(II) Annual assessments after the initial 
                        assessment performed under subclause (I), 
                        unless the physician or care coordinator of the 
                        individual determines that additional 
                        assessments are required due to sentinel health 
                        events or changes in the health status of the 
                        individual that may require changes in plans of 
                        care developed for the individual.
                            ``(ii) The development of an initial plan 
                        of care, and subsequent appropriate revisions 
                        to that plan of care.
                            ``(iii) The management of, and referral 
                        for, medical and other health services, 
                        including multidisciplinary care conferences 
                        and coordination with other providers.
                            ``(iv) The monitoring and management of 
                        medications.
                            ``(v) Patient education and counseling 
                        services.
                            ``(vi) Family caregiver education and 
                        counseling services.
                            ``(vii) Self-management services, including 
                        health education and risk appraisal to identify 
                        behavioral risk factors through self-
                        assessment.
                            ``(viii) Providing access for consultations 
                        by telephone with physicians and other 
                        appropriate health care professionals, 
                        including 24-hour availability of such 
                        professionals for emergency consultations.
                            ``(ix) Coordination with the principal 
                        nonprofessional caregiver in the home.
                            ``(x) Managing and facilitating transitions 
                        among health care professionals and across 
                        settings of care, including the following:
                                    ``(I) Pursuing the treatment option 
                                elected by the individual.
                                    ``(II) Including any advance 
                                directive executed by the individual in 
                                the medical file of the individual.
                            ``(xi) Activities that facilitate 
                        continuity of care and patient adherence to 
                        plans of care.
                            ``(xii) Information about, and referral to, 
                        hospice services, including patient and family 
                        caregiver education and counseling about 
                        hospice, and facilitating transition to hospice 
                        when elected.
                            ``(xiii) Such other medical and health care 
                        services for which payment would not otherwise 
                        be made under this title as the Secretary 
                        determines to be appropriate for effective care 
                        coordination, including the additional items 
                        and services as described in subparagraph (B).
                    ``(B) Additional benefits.--The Secretary may 
                specify additional benefits for which payment would not 
                otherwise be made under this title that may be 
                available to eligible beneficiaries who have made an 
                election under this section (subject to an assessment 
                by the care coordinator of an individual beneficiary's 
                circumstances and need for such benefits) in order to 
                encourage the receipt of, or to improve the 
                effectiveness of, care coordination services.
            ``(2) Care coordination and assessment requirement.--
        Notwithstanding any other provision of this title, with respect 
        to items and services for which payment is made under this 
        title furnished to a beneficiary for the diagnosis and 
        treatment of the beneficiary's serious and disabling chronic 
        condition, if the beneficiary has made an election to receive 
        care coordination and assessment services under this section, 
        the Secretary may require that payment may only be made under 
        this title for such items and services relating to such 
        condition if the items and services have been furnished by or 
        coordinated through the care coordinator. Under such provision, 
        the Secretary shall prescribe exceptions for emergency medical 
        services (as described in section 1852(d)(3), but without 
        regard to enrollment with a Medicare+Choice organization), and 
        other exceptions determined by the Secretary for the delivery 
        of timely and needed care.
    ``(e) Care Coordinators.--
            ``(1) Conditions of participation.--In order to be 
        qualified to furnish care coordination and assessment services 
        under this section, an individual or entity shall--
                    ``(A) be a health care professional or entity 
                (which may include physicians, physician group 
                practices, or other health care professionals or 
                entities the Secretary may find appropriate) meeting 
                such conditions as the Secretary may specify;
                    ``(B) enter into a care coordination agreement 
                under paragraph (2); and
                    ``(C) meet such criteria as the Secretary may 
                establish (which may include experience in the 
                provision of care coordination or primary care 
                physician's services).
            ``(2) Agreement term; payment.--
                    ``(A) Duration and renewal.--A care coordination 
                agreement under this subsection shall--
                            ``(i) be entered into for a period of 1 
                        year and may be renewed if the Secretary is 
                        satisfied that the care coordinator continues 
                        to meet the conditions of participation 
                        specified in paragraph (1);
                            ``(ii) assure the compliance of the care 
                        coordinator with such data collection and 
                        reporting requirements as the Secretary 
                        determines necessary to assess the effect of 
                        care coordination on health outcomes; and
                            ``(iii) contain such other terms and 
                        conditions as the Secretary may require.
                    ``(B) Payment for services.--The Secretary shall 
                establish payment terms and conditions and payment 
                rates for basic care coordination and assessment 
                services described in subsection (d)(1). The Secretary 
                may establish new billing codes to carry out the 
                provisions of this subparagraph.
    ``(f) Definitions.--In this section:
            ``(1) Serious and disabling chronic condition.--The term 
        `serious and disabling chronic condition' means, with respect 
        to an individual, that the individual has at least one physical 
        or mental condition and a licensed health care practitioner has 
        certified within the preceding 12-month period that--
                    ``(A) the individual has a level of disability such 
                that the individual is unable to perform (without 
                substantial assistance from another individual) for a 
                period of at least 90 days due to a loss of functional 
                capacity--
                            ``(i) at least 2 activities of daily 
                        living; or
                            ``(ii) such number of instrumental 
                        activities of daily living that is equivalent 
                        (as determined by the Secretary) to the level 
                        of disability described in clause (i);
                    ``(B) the individual has a level of disability 
                equivalent (as determined by the Secretary) to the 
                level of disability described in subparagraph (A); or
                    ``(C) the individual requires substantial 
                supervision to protect the individual from threats to 
                health and safety due to severe cognitive impairment.
            ``(2) Activities of daily living.--The term `activities of 
        daily living' means each of the following:
                    ``(A) Eating.
                    ``(B) Toileting.
                    ``(C) Transferring.
                    ``(D) Bathing.
                    ``(E) Dressing.
                    ``(F) Continence.
            ``(3) Instrumental activities of daily living.--The term 
        `instrumental activities of daily living' means each of the 
        following:
                    ``(A) Medication management.
                    ``(B) Meal preparation.
                    ``(C) Shopping.
                    ``(D) Housekeeping.
                    ``(E) Laundry.
                    ``(F) Money management.
                    ``(G) Telephone use.
                    ``(H) Transportation use.
            ``(4) Beneficiary.--The term `beneficiary' means an 
        individual entitled to benefits under part A, or enrolled under 
        part B, including an individual enrolled under the 
        Medicare+Choice program under part C.''.
    (b) Coverage of Care Coordination and Assessment Services as a Part 
B Medical Service.--
            (1) In general.--Section 1861(s) of the Social Security Act 
        (42 U.S.C. 1395x(s)) is amended--
                    (A) in the second sentence, by redesignating 
                paragraphs (16) and (17) as clauses (i) and (ii); and
                    (B) in the first sentence--
                            (i) by striking ``and'' at the end of 
                        paragraph (14);
                            (ii) by striking the period at the end of 
                        paragraph (15) and inserting ``; and''; and
                            (iii) by adding after paragraph (15) the 
                        following new paragraph:
            ``(16) care coordination and assessment services furnished 
        by a care coordinator in accordance with section 1866C.''.
            (2) Conforming amendments.--Sections 1864(a) 1902(a)(9)(C), 
        and 1915(a)(1)(B)(ii)(I) of such Act (42 U.S.C. 1395aa(a), 
        1396a(a)(9)(C), and 1396n(a)(1)(B)(ii)(I)) are each amended by 
        striking ``paragraphs (16) and (17)'' each place it appears and 
        inserting ``clauses (i) and (ii) of the second sentence''.
            (3) Part b coinsurance and deductible not applicable to 
        care coordination and assessment services.--
                    (A) Coinsurance.--Section 1833(a)(1) of the Social 
                Security Act (42 U.S.C. 1395l(a)(1)), as amended by 
                sections 105 and 223 of the Medicare, Medicaid, and 
                SCHIP Benefits Improvement and Protection Act of 2000, 
                as enacted into law by section 1(a)(6) of Public Law 
                106-554, is amended--
                            (i) by striking ``and'' at the end of 
                        subparagraph (T); and
                            (ii) by inserting before the final 
                        semicolon ``, and (V) with respect to care 
                        coordination and assessment services described 
                        in section 1861(s)(16) that are furnished by, 
                        or coordinated through, a care coordinator, the 
                        amounts paid shall be 100 percent of the 
                        payment amount established under section 
                        1866C''.
                    (B) Deductible.--Section 1833(b) of such Act (42 
                U.S.C. 1395l(b)) is amended--
                            (i) by striking ``and'' at the end of 
                        paragraph (5); and
                            (ii) by inserting before the final period 
                        ``, and (7) such deductible shall not apply 
                        with respect to care coordination and 
                        assessment services (as described in section 
                        1861(s)(16))''.
                    (C) Elimination of coinsurance in outpatient 
                hospital settings.--The third sentence of section 
                1866(a)(2)(A) of such Act (42 U.S.C. 1395cc(a)(2)(A)), 
                as amended by section 102(b)(2), is further amended by 
                inserting after ``section 1833(p),'' the following: 
                ``with respect to care coordination and assessment 
                services (as described in section 1861(s)(16)),''.

  TITLE II--PAYMENT INCENTIVES FOR QUALITY CARE FOR INDIVIDUALS WITH 
                SERIOUS AND DISABLING CHRONIC CONDITIONS

SEC. 201. ADJUSTMENTS TO FEE-FOR-SERVICE PAYMENT SYSTEMS.

    (a) In General.--The Secretary of Health and Human Services shall 
provide for appropriate adjustments to each of the payment systems 
described in subsection (b) to take into account the additional costs 
incurred in providing items and services under the medicare program to 
medicare beneficiaries who suffer from serious and disabling chronic 
conditions, including the consideration of the patient classification 
system (or other methodology) under subsection (d). The Secretary shall 
implement such adjustments for items and services furnished on or after 
October 1, 2005.
    (b) Payment Systems Described.--The payment systems referred to in 
subsection (a) are the following:
            (1) The prospective payment system for covered skilled 
        nursing facility services under section 1888(e) of such Act (42 
        U.S.C. 1395yy(e)).
            (2) The prospective payment system for home health services 
        under section 1895 of such Act (42 U.S.C. 1395fff).
            (3) The prospective payment system for outpatient hospital 
        services under section 1833(t) of such Act (42 U.S.C. 
        1395l(t)).
            (4) The physician fee schedule under section 1848 of such 
        Act (42 U.S.C. 1395w-4).
            (5) The composite rate of payment for dialysis services 
        under section 1881(b)(7) of such Act (42 U.S.C. 1395rr(b)(7)).
            (6) The payment rate for outpatient therapy services and 
        comprehensive outpatient rehabilitation services under section 
        1834(k) of such Act (42 U.S.C. 1395m(k)).
            (7) The payment rate for partial hospitalization services 
        established by the Secretary in regulations under title XVIII 
        of such Act.
            (8) The payment rate for hospice services under section 
        1814(i) of such Act (42 U.S.C. 1395f(i)).
    (c) Interim Report.--Not later than 18 months after the date of 
enactment of this Act, the Secretary shall submit to Congress a report 
on the proposed adjustments required under subsection (a) to the 
payment systems described in subsection (b), the methodology employed 
by the Secretary in providing for such proposed adjustments, and an 
assessment of the impact of such adjustments on access to effective 
care for medicare beneficiaries.
    (d) Patient Classification System.--The Secretary shall develop a 
patient classification system or other methodology to predict costs 
within and across postacute care settings attributable to furnishing 
items and services to medicare beneficiaries who suffer from serious 
and disabling chronic conditions. The Secretary shall develop such 
system by not later than October 1, 2004, and shall consult with 
representatives of providers of services and individuals with expertise 
in health care financing and risk adjustment methodology in developing 
such system.

SEC. 202. MEDICARE+CHOICE.

    (a) Revisions to Risk Adjustment Methodology.--
            (1) In general.--The Secretary shall revise the risk 
        adjustment methodology under section 1853(a)(3) of the Social 
        Security Act (42 U.S.C. 1395w-23(a)(3)) applicable to payments 
        to Medicare+Choice organizations offering specialized programs 
        for frail elderly and at-risk beneficiaries to take into 
        account variations in costs incurred by such organizations.
            (2) Methods considered.--In revising the risk adjustment 
        methodology under paragraph (1), the Secretary shall consider--
                    (A) hybrid risk adjustment payment systems, such as 
                partial capitation;
                    (B) new diagnostic and service markers that more 
                accurately predict high risk;
                    (C) improving the structural components of the 
                applicable method of payment, such as reducing payment 
                lag, using multiple site diagnostic data, and using 
                several years of data;
                    (D) providing for adjustments to payment amounts 
                for beneficiaries with comorbidities;
                    (E) testing concurrent risk adjustment 
                methodologies; and
                    (F) testing payment methods using data from 
                specialized programs for frail elderly and at-risk 
                beneficiaries.
            (3) Implementation.--The Secretary shall implement such 
        revisions to the risk adjustment methodology for items and 
        services furnished on or after January 1, 2005.
            (4) Interim report.--Not later than January 1, 2004, the 
        Secretary shall submit to Congress a report on revision of the 
        risk adjustment methodology required under paragraph (1), 
        including a description of the methods considered and employed 
        by the Secretary in providing for such revision and an 
        assessment of the impacts of such methods on access to 
        effective care for medicare beneficiaries.
    (b) Interim Continuation of Blended Rate for Specialized Programs 
for Frail Elderly and At-Risk Medicare Beneficiaries Residing in 
Institutions.--
            (1) In general.--In the case of a Medicare+Choice 
        organization that complies with the requirements under 
        paragraph (2) and that offers a Medicare+Choice plan that 
        provides for a specialized program for frail elderly and at-
        risk beneficiaries that exclusively serves beneficiaries in 
        institutions or beneficiaries that are entitled to medical 
        assistance under a State plan under title XIX, notwithstanding 
        section 1853(a)(3)(C)(ii) of the Social Security Act (42 U.S.C. 
        1395w-23(a)(3)(C)(ii)), such organization shall be paid 
        according to the method described in section 
        1853(a)(3)(C)(ii)(I) until such time as the Secretary has 
        implemented the revised risk adjustment methodology required in 
        subsection (a).
            (2) Requirements.--A Medicare+Choice organization may not 
        qualify for the payment methodology under paragraph (1) unless 
        the organization collects such data (and in such format) as the 
        Secretary requires to monitor quality of services provided, 
        outcomes, and costs, including functional and diagnostic data 
        and information collected through the Health Outcomes Survey.
    (c) Interim Continuation of Payment Methodologies for Demonstration 
Programs.--
            (1) In general.--Notwithstanding any other provision of 
        law, payment methodologies for medicare demonstration programs 
        for specialized programs for frail elderly and at-risk 
        beneficiaries that comply with the requirements under paragraph 
        (2) shall continue under the terms and conditions of the 
        demonstration authority, including the risk adjustment factors 
        and formula used for paying such demonstration programs, until 
        such time as the Secretary has implemented the revised risk 
        adjustment methodology required in subsection (a).
            (2) Requirements.--A medicare demonstration program may not 
        qualify for the payment methodology under paragraph (1) unless 
        the program collects such data (and in such format) as the 
        Secretary requires to monitor quality of services provided, 
        outcomes, and costs, including functional and diagnostic data 
        and information collected through the Health Outcomes Survey.
    (d) Interim Demonstration Program for Additional Payments for 
Specialized Programs.--
            (1) In general.--The Secretary shall establish a 
        demonstration program under which additional payments (in such 
        manner and amount as the Secretary determines appropriate) may 
        be made to a Medicare+Choice organization that complies with 
        the requirements under paragraph (2) and that offers a 
        Medicare+Choice plan that--
                    (A) provides, directly or through contract, for a 
                specialized program of care for enrollees with serious 
                and disabling chronic conditions; and
                    (B) exclusively serves enrollees with serious and 
                disabling chronic conditions or serves a 
                disproportionate share of such enrollees.
            (2) Requirements.--A Medicare+Choice organization may not 
        qualify for additional payments under paragraph (1) unless the 
        organization and the specialized program of care meet the 
        following requirements:
                    (A) Under the specialized program of care, a 
                clinical delivery system is established that meets the 
                needs of such enrollees, including--
                            (i) methods to prevent, delay, or minimize 
                        the progression of disabilities;
                            (ii) disease management protocols, such as 
                        high risk screening to identify risk of 
                        hospitalization, nursing home placement, 
                        functional decline, death, and other factors 
                        that increase the costs of care provided;
                            (iii) appropriate specially trained health 
                        care staff, such as nurse practitioners, 
                        geriatric care managers, or mental health 
                        professionals; and
                            (iv) methods for promoting integration of 
                        care, financing, and administrative functions 
                        across health care settings.
                    (B) The organization collects such data (and in 
                such format) as the Secretary requires to monitor 
                quality of services provided, outcomes, and costs, 
                including functional and diagnostic data and 
                information collected through the Health Outcomes 
                Survey.
                    (C) The organization employs quality standards and 
                tracks quality indicators specified by the Secretary 
                that are relevant to the special needs of enrollees 
                with serious and disabling chronic conditions.
                    (D) The organization does not receive payments, or 
                adjustment to payments, with respect to any enrollee by 
                reason of subsection (b) or (c).
            (3) Waiver authority.--The Secretary may waive such 
        requirements of title XVIII of the Social Security Act as may 
        be necessary to carry out this demonstration program.
            (4) Termination.--The demonstration program under this 
        subsection shall terminate 1 year after such time as the 
        Secretary has implemented  the revised risk adjustment 
methodology required in subsection (a).
            (5) Funding.--There are authorized to be appropriated to 
        the Secretary $25,000,000 for carrying out the demonstration 
        program under this subsection.
    (e) Definition.--In this section, the term ``specialized programs 
for frail elderly and at-risk beneficiaries'' means--
            (1) demonstrations approved by the Secretary for purposes 
        of testing the integration of acute and expanded care services 
        under prepaid financing which include prescription drugs and 
        other noncovered ancillary services, care coordination, and 
        home and community-based services, such as the social health 
        maintenance organization demonstration project authorized under 
        section 2355 of the Deficit Reduction Act of 1984 and expanded 
        under section 4207(b)(4)(B)(i) of the Omnibus Reconciliation 
        Act of 1990;
            (2) demonstrations approved by the Secretary for purposes 
        of improving quality of care and preventing hospitalizations 
        for nursing home residents, such as the EverCare demonstration 
        project;
            (3) demonstrations approved by the Secretary for purposes 
        of testing methods for integrating medicare and medicaid 
        benefits for the dually eligible, such as the Minnesota Senior 
        Health Options program, the Wisconsin Partnership program, the 
        Massachusetts Senior Care Organization program, and the 
        Rochester Community Care Network program;
            (4) demonstrations approved by the Secretary under 
        subsection (d); and
            (5) such other demonstrations or programs approved by the 
        Secretary for similar purposes, as determined by the Secretary.

   TITLE III--DEVELOPMENT OF NATIONAL POLICIES ON EFFECTIVE CHRONIC 
                             CONDITION CARE

SEC. 301. STUDY AND REPORT ON EFFECTIVE CHRONIC CONDITION CARE.

    (a) Study.--For purposes of improving chronic condition care 
furnished to medicare beneficiaries under the medicare program, the 
Secretary of Health and Human Services shall conduct a comprehensive 
study of chronic condition trends of medicare beneficiaries and 
associated service utilization, quality indicators, and cumulative 
costs.
    (b) Specific Matters Studied.--The study conducted under subsection 
(a) shall include an assessment of the following:
            (1) Chronic condition prevalence rates.
            (2) Demographic, medical, and functional information about 
        medicare beneficiaries with chronic conditions.
            (3) Utilization, cost, and quality data across settings, 
        including--
                    (A) expenditures under a State plan under title XIX 
                of the Social Security Act for individuals dually 
                eligible for benefits under the medicare and medicaid 
                programs,
                    (B) data on out-of-pocket expenses paid by medicare 
                beneficiaries,
                    (C) data on payments made by non-Federal health 
                insurance programs,
                    (D) amounts and percentages of overall payments 
                made to medicare providers of services and suppliers 
                for medicare beneficiaries with chronic conditions, and
                    (E) current and future cost-shifting for treatment 
                of such beneficiaries between the medicare and medicaid 
                programs.
    (c) Information.--
            (1) In general.--The Secretary may collect such data from 
        providers of services, suppliers, fiscal intermediaries, and 
        carriers. Such providers, suppliers, fiscal intermediaries, and 
        carriers shall furnish to the Secretary the data the Secretary 
        requires to conduct the study under subsection (a).
            (2) Requirement to consider data previously collected.--To 
        the maximum extent practicable, in conducting the study, the 
        Secretary shall analyze existing data and utilize existing data 
        collection methodologies.
            (3) Consultation.--The Secretary shall consult with 
        representatives of providers of services, suppliers, fiscal 
        intermediaries, and carriers with respect to data collection 
        requirements to conduct the study with respect to the specific 
        matters described in subsection (b).
    (d) Report.--
            (1) In general.--Not later than 3 years after the date of 
        enactment of this Act, and triennially thereafter, the 
        Secretary shall submit to Congress a report on the study 
        conducted under subsection (a) and the specific matters studied 
        under subsection (b).
            (2) Recommendations.--Each report shall also include 
        specific recommendations with respect to appropriate care for 
        medicare beneficiaries with chronic conditions, including the 
        establishment, and refinement, of goals for reducing chronic 
        condition prevalence rates and related medical expenses.
    (e) Definition.--In this section, the term ``chronic condition'' 
means one or more physical or mental conditions which are likely to 
last for an unspecified period of time, or for the duration of an 
individual's life, for which there is no known cure, and which may 
affect an individual's ability to carry out basic activities of daily 
living, instrumental activities of daily living, or both.
    (f) Reduction of Paperwork; Assistance With Development of 
Computer-Assisted Paperwork Reduction Technology.--
            (1) Reduction of paperwork.--Not later than one year after 
        the date of enactment of this Act, the Secretary shall, in 
        consultation with providers of services and suppliers under the 
        medicare program, patient advocacy groups, and State and local 
        health care administration experts, implement  a program to 
eliminate or simplify those paperwork requirements that are not 
required by law, and do not contribute to the quality of care furnished 
to medicare beneficiaries or the integrity of the medicare program.
            (2) Development of best practices software.--
                    (A) In general.--The Secretary, through the Office 
                of Research and Development of the Center for Medicare 
                and Medicaid Services, shall develop and disseminate to 
                providers of services and suppliers participating in 
                the medicare program best practices electronic software 
                and medical technology information systems designed to 
                reduce the duplicative recording of information, to 
                reduce the need for handwritten entries, and to reduce 
                the risk of medical and pharmaceutical errors in data 
                entry.
                    (B) Technical assistance.--The Secretary shall 
                provide for technical assistance in the use of the 
                electronic software developed under subparagraph (A).
                    (C) Authorization of appropriations.--For each of 
                fiscal years 2002, 2003, and 2004, there are authorized 
                to be appropriated to the Secretary $10,000,000 to 
                carry out this paragraph.

SEC. 302. INSTITUTE OF MEDICINE MEDICARE CHRONIC CONDITION CARE 
              IMPROVEMENT STUDY AND REPORT.

    (a) Study.--
            (1) In general.--The Secretary shall contract with the 
        Institute of Medicine of the National Academy of Sciences to--
                    (A) conduct a comprehensive study of the medicare 
                program to identify--
                            (i) factors that facilitate access to 
                        effective care (including, where appropriate, 
                        hospice care) for medicare beneficiaries with 
                        chronic conditions; and
                            (ii) factors that impede access to such 
                        care for such beneficiaries,
                including the issues studied under paragraph (2); and
                    (B) submit the report described in subsection (b).
            (2) Issues studied.--The study required under paragraph (1) 
        shall--
                    (A) identify inconsistent clinical, financial, or 
                administrative requirements across provider and 
                supplier settings or professional services with respect 
                to medicare beneficiaries;
                    (B) identify requirements under the program imposed 
                by law or regulation that--
                            (i) promote costshifting across providers 
                        and suppliers;
                            (ii) impede access to effective chronic 
                        condition care by requiring the demonstration 
                        of continuing clinical improvement of the 
                        condition as a prerequisite to coverage of 
                        certain benefits;
                            (iii) impose unnecessary burdens on such 
                        beneficiaries and their family caregivers;
                            (iv) impede coverage for services that 
                        prevent, delay, or minimize the progression of 
                        chronic conditions;
                            (v) impede the establishment of 
                        administrative information systems to track 
                        health status, utilization, cost, and quality 
                        data across providers and suppliers and 
                        provider settings;
                            (vi) impede the establishment of clinical 
                        information systems that support continuity of 
                        care across settings and over time;
                            (vii) impede the alignment of financial 
                        incentives among the medicare program, the 
                        medicaid program, and group health plans and 
                        providers and suppliers that furnish services 
                        to the same beneficiary; or
                            (viii) impede payment methods that 
                        encourage the enrollment of high-risk 
                        populations, support innovation, or encourage 
                        providers and suppliers to maintain or improve 
                        health status for such medicare beneficiaries.
    (b) Report.--On the date that is 18 months after the date of 
enactment of this Act, the Institute of Medicine of the National 
Academy of Sciences shall submit to Congress and the Secretary of 
Health and Human Services a report that contains--
            (1) a detailed statement of the findings and conclusions of 
        the study conducted under subsection (a); and
            (2) recommendations to improve access to effective care for 
        medicare beneficiaries with chronic conditions.
                                 <all>