[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 1185 Introduced in Senate (IS)]







108th CONGRESS
  1st Session
                                S. 1185

 To amend title XVIII of the Social Security Act and the Public Health 
      Service Act to improve outpatient health care for medicare 
    beneficiaries who reside in rural areas, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              June 4, 2003

 Mr. Thomas (for himself, Mr. Harkin, Mr. Domenici, Mr. Bingaman, Mr. 
 Roberts, Mr. Dayton, Mr. Smith, Ms. Cantwell, Mr. Inouye, Mr. Burns, 
  Mr. Johnson, Mr. Enzi, Mrs. Lincoln, Ms. Collins, Mr. Daschle, Mr. 
 Hagel, and Mr. Conrad) 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 and the Public Health 
      Service Act to improve outpatient health care for medicare 
    beneficiaries who reside in rural areas, and for other purposes.

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

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

    (a) Short Title.--This Act may be cited as the ``Rural Provider 
Equity Act of 2003''.
    (b) Amendments to Social Security Act.--Except as otherwise 
specifically provided, whenever in this Act an amendment is expressed 
in terms of an amendment to or repeal of a section or other provision, 
the reference shall be considered to be made to that section or other 
provision of the Social Security Act.
    (c) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; amendments to Social Security Act; table of 
                            contents.
Sec. 2. Rural physician reimbursement improvements.
Sec. 3. Physician assistant, nurse practitioner, and clinical nurse 
                            specialist improvements.
Sec. 4. Rural health clinic improvements.
Sec. 5. Extension of temporary increase for home health services 
                            furnished in a rural area.
Sec. 6. Rural community health center improvements.
Sec. 7. Ensuring appropriate coverage of ambulance services under 
                            ambulance fee schedule.
Sec. 8. Rural mental health care accessibility improvements.
Sec. 9. Rural health services research improvements.
Sec. 10. Exclusion for loan payments under National Health Service 
                            Corps loan repayment program.
Sec. 11. Virtual pharmacist consultation service demonstration 
                            projects.

SEC. 2. RURAL PHYSICIAN REIMBURSEMENT IMPROVEMENTS.

    (a) Medicare Incentive Payment Program Improvements.--
            (1) Procedures for secretary, and not physicians, to 
        determine when bonus payments under medicare incentive payment 
        program should be made.--Section 1833(m) (42 U.S.C. 1395l(m)) 
        is amended--
                    (A) by inserting ``(1)'' after ``(m)''; and
                    (B) by adding at the end the following new 
                paragraph:
    ``(2) The Secretary shall establish procedures under which the 
Secretary, and not the physician furnishing the service, is responsible 
for determining when a payment is required to be made under paragraph 
(1).''.
            (2) Educational program regarding the medicare incentive 
        payment program.--The Secretary of Health and Human Services 
        shall establish and implement an ongoing educational program to 
        provide education to physicians under the medicare program on 
        the medicare incentive payment program under section 1833(m) of 
        the Social Security Act (42 U.S.C. 1395l(m)).
            (3) Ongoing study and annual report on the medicare 
        incentive payment program.--
                    (A) Ongoing study.--The Secretary of Health and 
                Human Services shall conduct an ongoing study on the 
                medicare incentive payment program under section 
                1833(m) of the Social Security Act (42 U.S.C. 
                1395l(m)). Such study shall focus on whether such 
                program increases the access of medicare beneficiaries 
                who reside in an area that is designated (under section 
                332(a)(1)(A) of the Public Health Service Act (42 
                U.S.C. 254e(a)(1)(A))) as a health professional 
                shortage area to physicians' services under the 
                medicare program.
                    (B) Annual reports.--Not later than 1 year after 
                the date of enactment of this Act, and annually 
                thereafter, the Secretary of Health and Human Services 
                shall submit to Congress a report on the study 
                conducted under subparagraph (A), together with 
                recommendations for such legislation and administrative 
                actions as the Secretary considers appropriate.
    (b) Physician Fee Schedule Wage Index Revision.--Section 1848(e)(1) 
(42 U.S.C. 1395w-4(e)(1)) is amended--
            (1) in subparagraph (A), by striking ``subparagraphs (B) 
        and (C)'' and inserting ``subparagraphs (B), (C), and (E)''; 
        and
            (2) by adding at the end the following new subparagraph:
                    ``(E) Floor for work geographic indices.--
                            ``(i) In general.--After calculating the 
                        work geographic indices in subparagraph 
                        (A)(iii) for a year (beginning with 2004), the 
                        Secretary shall increase the work geographic 
                        index for the year to the applicable floor 
                        index for the year for any locality for which 
                        such geographic index is less than such 
                        applicable floor index.
                            ``(ii) Applicable floor index.--For 
                        purposes of clause (i), the term `applicable 
                        floor index' means--
                                    ``(I) 0.900 for services furnished 
                                during 2004; and
                                    ``(II) 1.000 for services furnished 
                                during 2005 and subsequent years.''.

SEC. 3. PHYSICIAN ASSISTANT, NURSE PRACTITIONER, AND CLINICAL NURSE 
              SPECIALIST IMPROVEMENTS.

    (a) Broadening Medicare Beneficiaries Access to Home Health 
Services and Hospice Care.--Section 1861(r) (42 U.S.C. 1395f(x)) is 
amended by adding at the end the following new sentences: ``For 
purposes of sections 1814(a)(2)(C), 1814(a)(7)(B), 1835(a)(2)(A), 
1861(m), 1861(dd), and 1895(c)(1), the term `physician' includes a 
nurse practitioner, a clinical nurse specialist, and a physician 
assistant (as such terms are defined in subsection (aa)(5)) who does 
not have a direct or indirect employment relationship with the home 
health agency or hospice program (as the case may be), and is legally 
authorized to perform the services of a nurse practitioner, a clinical 
nurse specialist, or a physician assistant (as the case may be) in the 
jurisdiction in which the services are performed. For purposes of the 
preceding sentence, the provisions of section 1833(a)(1)(O) shall 
continue to apply with respect to amounts paid for services furnished 
by such a nurse practitioner, a clinical nurse specialist, and a 
physician assistant.''.
    (b) Skilled Nursing Facilities.--Section 1819(b)(6) (42 U.S.C. 
1395i-3(b)(6)) is amended--
            (1) in the paragraph heading, by inserting ``or nurse 
        practitioner'' after ``Physician''; and
            (2) in subparagraph (A), by inserting ``or nurse 
        practitioner, including approving in writing a recommendation 
        that an individual be admitted to a skilled nursing facility, 
        admitting an individual to a skilled nursing facility, and 
        performing the initial admitting assessment and all visits 
        thereafter'' before the semicolon.
    (c) Effective Date.--The amendments made by this section shall take 
effect on January 1, 2004.

SEC. 4. RURAL HEALTH CLINIC IMPROVEMENTS.

    (a) Improvement in Rural Health Clinic Reimbursement Under 
Medicare.--Section 1833(f) (42 U.S.C. 1395l(f)) is amended--
            (1) in paragraph (1), by striking ``, and'' at the end and 
        inserting a semicolon;
            (2) in paragraph (2)--
                    (A) by striking ``in a subsequent year'' and 
                inserting ``in 1989 through 2002''; and
                    (B) by striking the period at the end and inserting 
                a semicolon; and
            (3) by adding at the end the following new paragraphs:
            ``(3) in 2003, at $82 per visit; and
            ``(4) in a subsequent year, at the limit established under 
        this subsection for the previous year increased by the 
        percentage increase in the MEI (as so defined) applicable to 
        primary care services (as so defined) furnished as of the first 
        day of that year.''.
    (b) Exclusion of Certain Rural Health Clinic and Federally 
Qualified Health Center Services From the Medicare Prospective Payment 
System for Skilled Nursing Facilities.--
            (1) In general.--Section 1888(e)(2)(A) (42 U.S.C. 
        1395yy(e)(2)(A)) is amended--
                    (A) in clause (i)(II), by striking ``clauses (ii) 
                and (iii)'' and inserting ``clauses (ii), (iii), and 
                (iv)''; and
                    (B) by adding at the end the following new clause:
                            ``(iv) Exclusion of certain rural health 
                        clinic and federally qualified health center 
                        services.--Services described in this clause 
                        are--
                                    ``(I) rural health clinic services 
                                (as defined in paragraph (1) of section 
                                1861(aa)); and
                                    ``(II) Federally qualified health 
                                center services (as defined in 
                                paragraph (3) of such section);
                        that would be described in clause (ii) if such 
                        services were not furnished by an individual 
                        affiliated with a rural health clinic or a 
                        Federally qualified health center.''.
            (2) Effective date.--The amendments made by subsection (a) 
        shall apply to services furnished on or after January 1, 2003.

SEC. 5. EXTENSION OF TEMPORARY INCREASE FOR HOME HEALTH SERVICES 
              FURNISHED IN A RURAL AREA.

    (a) In General.--Section 508(a) of the Medicare, Medicaid, and 
SCHIP Benefits Improvement and Protection Act of 2000 (114 Stat. 2763A-
533), as enacted into law by section 1(a)(6) of Public Law 106-554, is 
amended--
            (1) in the heading, by striking ``24-Month Increase 
        Beginning April 1, 2001'' and inserting ``In General'';
            (2) by striking ``April 1, 2003'' and inserting ``April 1, 
        2004''; and
            (3) by inserting before the period at the end the 
        following: ``(or 5 percent in the case of such services 
        furnished on or after April 1, 2003, and before April 1, 
        2004)''.
    (b) Conforming Amendment.--Section 547(c)(2) of the Medicare, 
Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 
(114 Stat. 2763A-553), as enacted into law by section 1(a)(6) of Public 
Law 106-554, is amended by striking ``the period beginning on April 1, 
2001, and ending on September 30, 2002,'' and inserting ``a period 
under such section''.
    (c) Retroactive Application.--The amendments made by this section 
shall apply with respect to home health services furnished in a rural 
area on or after April 1, 2003.

SEC. 6. RURAL COMMUNITY HEALTH CENTER IMPROVEMENTS.

    (a) Delivery of Medicare-Covered Primary and Preventive Services at 
Federally Qualified Health Centers.--
            (1) Coverage of medicare-covered ambulatory services by 
        fqhcs.--Section 1861(aa)(3) (42 U.S.C. 1395x(aa)(3)) is amended 
        to read as follows:
    ``(3) The term `Federally qualified health center services' means--
            ``(A) services of the type described in subparagraphs (A) 
        through (C) of paragraph (1), and such other services furnished 
        by a Federally qualified health center for which payment may 
        otherwise be made under this title if such services were 
        furnished by a health care provider or health care professional 
        other than a Federally qualified health center; and
            ``(B) preventive primary health services that a center is 
        required to provide under section 330 of the Public Health 
        Service Act,
when furnished to an individual as a patient of a Federally qualified 
health center and such services when provided by a health care provider 
or health care professional employed by or under contract with a 
Federally qualified health center shall be treated as billable visits 
for purposes of payment to the Federally qualified health center.''.
            (2) Ensuring fqhc reimbursement under hospital and skilled 
        nursing facility prospective payment systems.--Section 
        1862(a)(14) (42 U.S.C. 1395y(a)) is amended by inserting 
        ``Federally qualified health center services,'' after 
        ``qualified psychologist services,''.
            (3) Technical corrections.--Clauses (i) and (ii)(II) of 
        section 1861(aa)(4)(A) (42 U.S.C. 1395x(aa)(4)(A)) are each 
        amended by striking ``(other than subsection (h))''.
            (4) Effective dates.--The amendments made--
                    (A) by paragraphs (1) and (2) shall apply to 
                services furnished on or after January 1, 2004; and
                    (B) by paragraph (3) shall take effect on the date 
                of enactment of this Act.
    (b) Providing Safe Harbor for Certain Collaborative Efforts That 
Benefit Medically Underserved Populations.--
            (1) In general.--Section 1128B(b)(3) (42 U.S.C. 1320a-
        7(b)(3)) is amended--
                    (A) in subparagraph (E), by striking ``and'' after 
                the semicolon at the end;
                    (B) in subparagraph (F), by striking the period at 
                the end and inserting ``; and''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(G) any remuneration between a public or 
                nonprofit private health center entity described under 
                clause (i) or (ii) of section 1905(l)(2)(B) and any 
                individual or entity providing goods, items, services, 
                donations or loans, or a combination thereof, to such 
                health center entity pursuant to a contract, lease, 
                grant, loan, or other agreement, if such agreement 
                contributes to the ability of the health center entity 
                to maintain or increase the availability, or enhance 
                the quality, of services provided to a medically 
                underserved population served by the health center 
                entity.''.
            (2) Rulemaking for exception for health center entity 
        arrangements.--
                    (A) Establishment.--
                            (i) In general.--The Secretary of Health 
                        and Human Services (in this paragraph referred 
                        to as the ``Secretary'') shall establish, on an 
                        expedited basis, standards relating to the 
                        exception described in section 1128B(b)(3)(G) 
                        of the Social Security Act, as added by 
                        paragraph (1), for health center entity 
                        arrangements to the antikickback penalties.
                            (ii) Factors to consider.--The Secretary 
                        shall consider the following factors, among 
                        others, in establishing standards relating to 
                        the exception for health center entity 
                        arrangements under clause (i):
                                    (I) Whether the arrangement between 
                                the health center entity and the other 
                                party results in savings of Federal 
                                grant funds or increased revenues to 
                                the health center entity.
                                    (II) Whether the arrangement 
                                between the health center entity and 
                                the other party restricts or limits a 
                                patient's freedom of choice.
                                    (III) Whether the arrangement 
                                between the health center entity and 
                                the other party protects a health care 
                                professional's independent medical 
                                judgment regarding medically 
                                appropriate treatment.
                        The Secretary may also include other standards 
                        and criteria that are consistent with the 
                        intent of Congress in enacting the exception 
                        established under this section.
                    (B) Interim final effect.--No later than 180 days 
                after the date of enactment of this Act, the Secretary 
                shall publish a rule in the Federal Register consistent 
                with the factors under subparagraph (A)(ii). Such rule 
                shall be effective and final immediately on an interim 
                basis, subject to such change and revision, after 
                public notice and opportunity (for a period of not more 
                than 60 days) for public comment, as is consistent with 
                this paragraph.

SEC. 7. ENSURING APPROPRIATE COVERAGE OF AMBULANCE SERVICES UNDER 
              AMBULANCE FEE SCHEDULE.

    (a) Air Ambulance Service.--
            (1) Coverage.--Section 1834(l) (42 U.S.C. 1395m(l)) is 
        amended--
                    (A) by redesignating paragraph (8), as added by 
                section 221(a) of Medicare, Medicaid, and SCHIP 
                Benefits Improvement and Protection Act of 2000 (114 
                Stat. 2763A-486), as enacted into law by section 
                1(a)(6) of Public Law 106-554, as paragraph (9); and
                    (B) by adding at the end the following new 
                paragraph:
            ``(10) Ensuring appropriate coverage of air ambulance 
        services.--
                    ``(A) In general.--The regulations described in 
                section 1861(s)(7) shall ensure that air ambulance 
                services (as defined in subparagraph (C)) are 
                reimbursed under this subsection at the air ambulance 
                rate if the air ambulance service--
                            ``(i) is medically necessary based on the 
                        health condition of the individual being 
                        transported at or immediately prior to the time 
                        of the transport; and
                            ``(ii) complies with equipment and crew 
                        requirements established by the Secretary.
                    ``(B) Medically necessary.--An air ambulance 
                service shall be considered to be medically necessary 
                for purposes of subparagraph (A)(i) if such service is 
                requested--
                            ``(i) by a physician or a hospital in 
                        accordance with the physician's or hospital's 
                        responsibilities under section 1867 (commonly 
                        known as the `Emergency Medical Treatment and 
                        Active Labor Act');
                            ``(ii) as a result of a protocol 
                        established by a State or regional emergency 
                        medical service (EMS) agency;
                            ``(iii) by a physician, nurse practitioner, 
                        physician assistant, registered nurse, or 
                        emergency medical responder who reasonably 
                        determines or certifies that the patient's 
                        condition is such that the time needed to 
                        transport the individual by land or the lack of 
                        an appropriate ground ambulance, significantly 
                        increases the medical risks for the individual; 
                        or
                            ``(iv) by a Federal or State agency to 
                        relocate patients following a natural disaster, 
                        an act of war, or a terrorist attack.
                    ``(C) Air ambulance services defined.--For purposes 
                of this paragraph, the term `air ambulance service' 
                means fixed wing and rotary wing air ambulance 
                services.''.
            (2) Conforming amendment.--Section 1861(s)(7) (42 U.S.C. 
        1395x(s)(7)) is amended by inserting ``, subject to section 
        1834(l)(10),'' after ``but''.
    (b) Ground Ambulance Service.--
            (1) Payment rates.--
                    (A) In general.--Section 1834(l)(3) (42 U.S.C. 
                1395m(l)(3)) is amended to read as follows:
            ``(3) Payment rates.--
                    ``(A) In general.--Subject to any adjustment under 
                subparagraph (B) and paragraph (9) and the full payment 
                of a national mileage rate pursuant to paragraph 
                (2)(E), in establishing such fee schedule, the 
                following rules shall apply:
                            ``(i) Payment rates in 2003.--
                                    ``(I) Ground ambulance services.--
                                In the case of ground ambulance 
                                services furnished under this part in 
                                2003, the Secretary shall set the 
                                payment rates under the fee schedule 
                                for such services at a rate based on 
                                the average costs (as determined by the 
                                Secretary on the basis of the most 
                                recent and reliable information 
                                available) incurred by full cost 
                                ambulance suppliers in providing 
                                nonemergency basic life support 
                                ambulance services covered under this 
                                title, with adjustments to the rates 
                                for other ground ambulance service 
                                levels to be determined based on the 
                                rule established under paragraph (1). 
                                For the purposes of the preceding 
                                sentence, the term `full cost ambulance 
                                supplier' means a supplier for which 
                                volunteers or other unpaid staff 
                                comprise less than 20 percent of the 
                                supplier's total staff and which 
                                receives less than 20 percent of space 
                                and other capital assets free of 
                                charge.
                                    ``(II) Other ambulance services.--
                                In the case of ambulance services not 
                                described in subclause (I) that are 
                                furnished under this part in 2003, the 
                                Secretary shall set the payment rates 
                                under the fee schedule for such 
                                services based on the rule established 
                                under paragraph (1).
                            ``(ii) Payment rates in subsequent years 
                        for all ambulance services.--In the case of any 
                        ambulance service furnished under this part in 
                        2004 or any subsequent year, the Secretary 
                        shall set the payment rates under the fee 
                        schedule for such service at amounts equal to 
                        the payment rate under the fee schedule for 
                        that service furnished during the previous 
                        year, increased by the percentage increase in 
                        the Consumer Price Index for all urban 
                        consumers (United States city average) for the 
                        12-month period ending with June of the 
                        previous year.
                    ``(B) Adjustment in rural rates.--For years 
                beginning with 2004, the Secretary, after taking into 
                consideration the recommendations contained in the 
                report submitted under section 221(b)(3) the Medicare, 
                Medicaid, and SCHIP Benefits Improvements and 
                Protection Act of 2000, shall adjust the fee schedule 
                payment rates that would otherwise apply under this 
                subsection for ambulance services provided in low 
                density rural areas based on the increased cost (if 
                any) of providing such services in such areas.''.
                    (B) Conforming amendment.--Section 221(c) of the 
                Medicare, Medicaid, and SCHIP Benefits Improvement and 
                Protection Act of 2000 (114 Stat. 2763A-487), as 
                enacted into law by section 1(a)(6) of Public Law 106-
                554, is repealed.
            (2) Use of medical conditions for coding ambulance 
        services.--Section 1834(l)(7) (42 U.S.C. 1395m(l)(7)) is 
        amended to read as follows:
            ``(7) Coding system.--
                    ``(A) In general.--The Secretary shall, in 
                accordance with section 1173(c)(1)(B), establish a 
                system or systems for the coding of claims for 
                ambulance services for which payment is made under this 
                subsection, including a code set specifying the medical 
                condition of the individual who is transported and the 
                level of service that is appropriate for the 
                transportation of an individual with that medical 
                condition.
                    ``(B) Medical conditions.--The code set established 
                under subparagraph (A) shall--
                            ``(i) take into account the list of medical 
                        conditions developed in the course of the 
                        negotiated rulemaking process conducted under 
                        paragraph (1); and
                            ``(ii) notwithstanding any other provision 
                        of law, be adopted as a standard code set under 
                        section 1173(c).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to services furnished on or after the date of the enactment of 
this Act.

SEC. 8. RURAL MENTAL HEALTH CARE ACCESSIBILITY IMPROVEMENTS.

    (a) Interdisciplinary Grant Program.--Subpart I of part D of title 
III of the Public Health Service Act (42 U.S.C. 254b et seq.) is 
amended by adding at the end the following new section:

``SEC. 330L. INTERDISCIPLINARY GRANT PROGRAM.

    ``(a) Program Authorized.--The Director of the Office of Rural 
Health Policy (of the Health Resources and Services Administration) 
shall award grants to eligible entities to establish interdisciplinary 
training programs that include significant mental health training in 
rural areas for certain health care providers.
    ``(b) Definitions.--In this section:
            ``(1) Eligible entity.--The term `eligible entity' means a 
        public university or other educational institution that 
        provides training for mental health care providers or primary 
        health care providers.
            ``(2) Mental health care provider.--The term `mental health 
        care provider' means--
                    ``(A) a physician with postgraduate training in a 
                residency program of psychiatry;
                    ``(B) a licensed psychologist (as defined by the 
                Secretary for purposes of section 1861(ii) of such Act 
                (42 U.S.C. 1395x(ii)));
                    ``(C) a clinical social worker (as defined in 
                section 1861(hh)(1) of such Act (42 U.S.C. 
                1395x(hh)(1)); or
                    ``(D) a clinical nurse specialist (as defined in 
                section 1861(aa)(5)(B) of such Act (42 U.S.C. 
                1395x(aa)(5)(B))).
            ``(3) Primary health care provider.--The term `primary 
        health care provider' includes family practice, internal 
        medicine, pediatrics, obstetrics and gynecology, geriatrics, 
        and emergency medicine physicians as well as physician 
        assistants and nurse practitioners.
            ``(4) Rural area.--The term `rural area' means a rural area 
        as defined in section 1886(d)(2)(D) of the Social Security Act, 
        or such an area in a rural census tract of a metropolitan 
        statistical area (as determined under the most recent 
        modification of the Goldsmith Modification, originally 
        published in the Federal Register on February 27, 1992 (57 Fed. 
        Reg. 6725)), or any other geographical area that the Director 
        designates as a rural area.
    ``(c) Duration.--Grants awarded under subsection (a) shall be 
awarded for a period of 5 years.
    ``(d) Use of Funds.--An eligible entity that receives a grant under 
subsection (a) shall use funds received through such grant to 
administer an interdisciplinary, side-by-side training program for 
mental health care providers and primary health care providers, that 
includes providing, under appropriate supervision, health care services 
to patients in underserved, rural areas without regard to patients' 
ability to pay for such services.
    ``(e) Application.--An eligible entity desiring a grant under 
subsection (a) shall submit an application to the Director at such 
time, in such manner, and containing such information as the Director 
may reasonably require, including--
            ``(1) a description of the activities which the eligible 
        entity intends to carry out using amounts provided under the 
        grant;
            ``(2) a description of the manner in which the activities 
        funded under the grant will meet the mental health care needs 
        of underserved rural populations within the State; and
            ``(3) a description of the network agreement with 
        partnering facilities.
    ``(f) Evaluations; Report.--Each eligible entity that receives a 
grant under this section shall submit to the Director of the Office of 
Rural Health Policy (of the Health Resources and Services 
Administration) an evaluation describing the programs authorized under 
this section and any other information that the Director deems 
appropriate. After receiving such evaluations, the Director shall 
submit to the appropriate committees of Congress a report describing 
such evaluations.
    ``(g) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section, $100,000,000 for fiscal year 
2002 and such sums as may be necessary for each of the fiscal years 
2003 through 2006.''.
    (b) Coverage of Marriage and Family Therapist Services and Mental 
Health Counselor Services Under Part B of the Medicare Program.--
            (1) Coverage of services.--
                    (A) In general.--Section 1861(s)(2) (42 U.S.C. 
                1395x(s)(2)) is amended--
                            (i) in subparagraph (U), by striking 
                        ``and'' after the semicolon at the end;
                            (ii) in subparagraph (V)(iii), by inserting 
                        ``and'' after the semicolon at the end; and
                            (iii) by adding at the end the following 
                        new subparagraph:
            ``(W) marriage and family therapist services (as defined in 
        subsection (ww)(1)) and mental health counselor services (as 
        defined in subsection (ww)(3));''.
                    (B) Definitions.--Section 1861 (42 U.S.C. 1395x) is 
                amended by adding at the end the following new 
                subsection:

     ``Marriage and Family Therapist Services; Marriage and Family 
  Therapist; Mental Health Counselor Services; Mental Health Counselor

    ``(ww)(1) The term `marriage and family therapist services' means 
services performed by a marriage and family therapist (as defined in 
paragraph (2)) for the diagnosis and treatment of mental illnesses, 
which the marriage and family therapist is legally authorized to 
perform under State law (or the State regulatory mechanism provided by 
State law) of the State in which such services are performed, as would 
otherwise be covered if furnished by a physician or as an incident to a 
physician's professional service, but only if no facility or other 
provider charges or is paid any amounts with respect to the furnishing 
of such services.
    ``(2) The term `marriage and family therapist' means an individual 
who--
            ``(A) possesses a master's or doctoral degree which 
        qualifies for licensure or certification as a marriage and 
        family therapist pursuant to State law;
            ``(B) after obtaining such degree has performed at least 2 
        years of clinical supervised experience in marriage and family 
        therapy; and
            ``(C) in the case of an individual performing services in a 
        State that provides for licensure or certification of marriage 
        and family therapists, is licensed or certified as a marriage 
        and family therapist in such State.
    ``(3) The term `mental health counselor services' means services 
performed by a mental health counselor (as defined in paragraph (4)) 
for the diagnosis and treatment of mental illnesses which the mental 
health counselor is legally authorized to perform under State law (or 
the State regulatory mechanism provided by the State law) of the State 
in which such services are performed, as would otherwise be covered if 
furnished by a physician or as incident to a physician's professional 
service, but only if no facility or other provider charges or is paid 
any amounts with respect to the furnishing of such services.
    ``(4) The term `mental health counselor' means an individual who--
            ``(A) possesses a master's or doctor's degree in mental 
        health counseling or a related field;
            ``(B) after obtaining such a degree has performed at least 
        2 years of supervised mental health counselor practice; and
            ``(C) in the case of an individual performing services in a 
        State that provides for licensure or certification of mental 
        health counselors or professional counselors, is licensed or 
        certified as a mental health counselor or professional 
        counselor in such State.''.
                    (C) Provision for payment under part b.--Section 
                1832(a)(2)(B) (42 U.S.C. 1395k(a)(2)(B)) is amended by 
                adding at the end the following new clause:
                            ``(v) marriage and family therapist 
                        services and mental health counselor 
                        services;''.
                    (D) Amount of payment.--Section 1833(a)(1) (42 
                U.S.C. 1395l(a)(1)) is amended--
                            (i) by striking ``and (U)'' and inserting 
                        ``(U)''; and
                            (ii) by inserting before the semicolon at 
                        the end the following: ``, and (V) with respect 
                        to marriage and family therapist services and 
                        mental health counselor services under section 
                        1861(s)(2)(W), the amounts paid shall be 80 
                        percent of the lesser of the actual charge for 
                        the services or 75 percent of the amount 
                        determined for payment of a psychologist under 
                        subparagraph (L)''.
                    (E) Exclusion of marriage and family therapist 
                services and mental health counselor services from 
                skilled nursing facility prospective payment system.--
                            (i) In general.--Section 1888(e)(2)(A) (42 
                        U.S.C. 1395yy(e)(2)(A)), as amended by section 
                        4(b)(1)(B), is amended--
                                    (I) in clause (i)(II), by striking 
                                ``clauses (ii), (iii), and (iv)'' and 
                                inserting ``clauses (ii), (iii), (iv), 
                                and (v)''; and
                                    (II) by adding at the end the 
                                following new clause:
                            ``(v) Exclusion of marriage and family 
                        therapist services and mental health counselor 
                        services.--Services described in this clause 
                        are marriage and family therapist services (as 
                        defined in subsection (ww)(1)) and mental 
                        health counselor services (as defined in 
                        section 1861(ww)(3)).''.
                            (ii) Effective date.--The amendments made 
                        by clause (i) shall apply to services furnished 
                        on or after January 1, 2003.
                    (F) Inclusion of marriage and family therapists and 
                mental health counselors as practitioners for 
                assignment of claims.--Section 1842(b)(18)(C) (42 
                U.S.C. 1395u(b)(18)(C)) is amended by adding at the end 
                the following new clauses:
            ``(vii) A marriage and family therapist (as defined in 
        section 1861(ww)(2)).
            ``(viii) A mental health counselor (as defined in section 
        1861(ww)(4)).''.
    (b) Coverage of Certain Mental Health Services Provided in Certain 
Settings.--
            (1) Rural health clinics and federally qualified health 
        centers.--Section 1861(aa)(1)(B) (42 U.S.C. 1395x(aa)(1)(B)) is 
        amended by striking ``or by a clinical social worker (as 
        defined in subsection (hh)(1)),'' and inserting ``, by a 
        clinical social worker (as defined in subsection (hh)(1)), by a 
        marriage and family therapist (as defined in subsection 
        (ww)(2)), or by a mental health counselor (as defined in 
        subsection (ww)(4)),''.
            (2) Hospice programs.--Section 1861(dd)(2)(B)(i)(III) (42 
        U.S.C. 1395x(dd)(2)(B)(i)(III)) is amended by inserting ``or a 
        marriage and family therapist (as defined in subsection 
        (ww)(2))'' after ``social worker''.
    (c) Authorization of Marriage and Family Therapists To Develop 
Discharge Plans for Post-Hospital Services.--Section 1861(ee)(2)(G) (42 
U.S.C. 1395x(ee)(2)(G)) is amended by inserting ``marriage and family 
therapist (as defined in subsection (ww)(2)),'' after ``social 
worker,''.
    (d) Effective Date.--The amendments made by this subsection shall 
apply with respect to services furnished on or after January 1, 2004.

SEC. 9. RURAL HEALTH SERVICES RESEARCH IMPROVEMENTS.

    (a) In General.--Section 711(b) (42 U.S.C. 912(b)) is amended--
            (1) in paragraph (3), by striking ``and'' after the comma 
        at the end;
            (2) in paragraph (4), by striking the period at the end and 
        inserting ``, and''; and
            (3) by adding at the end the following new paragraph:
            ``(5) have the authority to administer grants to support 
        rural health services research.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect on January 1, 2004.

SEC. 10. EXCLUSION FOR LOAN PAYMENTS UNDER NATIONAL HEALTH SERVICE 
              CORPS LOAN REPAYMENT PROGRAM.

    (a) In General.--Section 117 of the Internal Revenue Code of 1986 
is amended by adding at the end the following new subsection:
    ``(e) Loan Payments Under National Health Service Corps Loan 
Repayment Program.--Gross income shall not include any amount received 
under section 338B(g) of the Public Health Service Act.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to amounts received by an individual in taxable years beginning 
after December 31, 2002.

SEC. 11. VIRTUAL PHARMACIST CONSULTATION SERVICE DEMONSTRATION 
              PROJECTS.

    (a) Definitions.--In this section:
            (1) Demonstration project.--The term ``demonstration 
        project'' means a demonstration project established by the 
        Secretary under subsection (b)(1).
            (2) Drug.--The term ``drug'' means any drug or biological 
        (as those terms are defined in section 1861(t) of the Social 
        Security Act (42 U.S.C. 1395x(t)), regardless of whether 
        payment may be made for such drug or biological under the 
medicare program.
            (3) Eligible beneficiary.--The term ``eligible 
        beneficiary'' means an individual enrolled under part B of the 
        medicare program for whom a drug is being prescribed.
            (4) Eligible originating site.--The term ``eligible 
        originating site'' means the site at which a health care 
        provider (as defined by the Secretary) is located at the time a 
        drug is prescribed which may be--
                    (A) the office of a physician (as defined in 
                section 1861(r) of the Social Security Act (42 U.S.C. 
                1395x(r))) or a practitioner (as described in section 
                1842(b)(18)(C) of such Act (42 U.S.C. 
                1395u(b)(18)(C)));
                    (B) a rural health clinic (as defined in section 
                1861(aa)(2) of the Social Security Act (42 U.S.C. 
                1395x(aa)(2)));
                    (C) a hospital (as defined in section 1861(e) of 
                such Act (42 U.S.C. 1395x(e))) located in a rural area 
                (as defined in section 1886(d)(2) of such Act (42 
                U.S.C. 1395ww(d)(2)));
                    (D) a critical access hospital (as defined in 
                section 1861(mm)(1) of such Act (42 U.S.C. 
                1395x(mm)(1)));
                    (E) a community mental health center (as described 
                in section 1861(ff)(2)(B) of such Act (42 U.S.C. 
                1395x(ff)(2)(B))); or
                    (F) a sole community hospital (as defined in 
                section 1886(d)(5)(D)(iii) of such Act).
            (5) Eligible pharmacist.--The term ``eligible pharmacist'' 
        means a pharmacist who meets such requirements as the Secretary 
        may establish for purposes of the demonstration projects and 
        who is a full-time employee of a school of pharmacy.
            (6) Medicare program.--The term ``medicare program'' means 
        the health benefits program under title XVIII of the Social 
        Security Act (42 U.S.C. 1395 et seq.).
            (7) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (8) Virtual pharmacist consultation service.--The term 
        ``virtual pharmacist consultation service'' means professional 
        consultations furnished by an eligible pharmacist and any 
        additional service specified by the Secretary that is furnished 
        by such a pharmacist.
    (b) Virtual Pharmacist Consultation Service Demonstration 
Projects.--
            (1) Establishment.--The Secretary shall establish 
        demonstration projects in accordance with the provisions of 
        this section to provide virtual pharmacist consultation 
        services with respect to drugs being prescribed to eligible 
        beneficiaries.
            (2) Participation.--Any eligible pharmacist located at a 
        school of pharmacy may furnish virtual pharmacist consultation 
        services under the demonstration projects and any eligible 
        originating site that does not have a pharmacist on staff may 
        participate in the demonstration projects on a voluntary basis.
    (c) Payment for Virtual Pharmacist Consultation Services.--
            (1) In general.--The Secretary shall pay for virtual 
        pharmacist consultation services that are furnished via a 
        telecommunications system by an eligible pharmacist with 
        respect to a drug that is being prescribed to an eligible 
        beneficiary.
            (2) Payment amount.--
                    (A) Eligible pharmacists at schools of pharmacy.--
                The Secretary shall pay an amount determined by the 
                Secretary for purposes of the demonstration projects to 
                an eligible pharmacist who furnishes a virtual 
                pharmacist consultation service while such pharmacist 
                is located at a school of pharmacy that furnishes a 
                virtual pharmacist consultation service with respect to 
                a drug prescribed to an eligible beneficiary.
                    (B) Facility fee for eligible originating site.--If 
                the Secretary determines that it is appropriate, the 
                Secretary may pay the eligible originating site a 
                facility fee determined by the Secretary for purposes 
                of the demonstration projects which may not exceed the 
                facility fee determined under section 1834(m)(2)(B) of 
                the Social Security Act (42 U.S.C. 1395m(m)(2)(B)).
            (3) No beneficiary charges.--An eligible beneficiary may 
        not be charged any amount by an eligible pharmacist, eligible 
        originating site, the Secretary or any other individual or 
        entity for a virtual pharmacist service furnished under a 
        demonstration project.
    (d) Conduct of Demonstration Projects.--
            (1) Demonstration areas.--
                    (A) In general.--The Secretary shall conduct 
                demonstration projects in 5 demonstration areas 
                selected on the basis of proposals submitted under 
                subparagraph (B). Such demonstration areas shall be 
                geographically disparate.
                    (B) Proposals.--The Secretary shall accept 
                proposals to furnish virtual pharmacist consultation 
                services under the demonstration projects from any 
                school of pharmacy that is able to furnish virtual 
                pharmacist services to an underserved rural area.
            (2) Duration.--The Secretary shall complete the 
        demonstration projects by the date that is 3 years after the 
        date on which the first demonstration project is implemented.
    (e) Report to Congress.--Not later than the date that is 6 months 
after the date on which the demonstration projects end, the Secretary 
shall submit to Congress a report on the demonstration projects 
together with such recommendations for legislation or administrative 
action as the Secretary determines is appropriate.
    (f) Waiver of Medicare Requirements.--The Secretary shall waive 
compliance with such requirements of the medicare program to the extent 
and for the period the Secretary finds necessary to conduct the 
demonstration projects.
    (g) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary to carry out the 
demonstration projects under this section, including such sums as may 
be necessary to develop, implement, and evaluate such projects.
                                 <all>