[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 27 Introduced in House (IH)]







111th CONGRESS
  1st Session
                                 H. R. 27

To amend title XVIII of the Social Security Act to establish additional 
   provisions to combat waste, fraud, and abuse within the Medicare 
                    Program, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 6, 2009

 Mrs. Biggert introduced the following bill; which was referred to the 
   Committee on Ways and Means, and in addition to the Committees on 
Energy and Commerce and the Judiciary, for a period to be subsequently 
   determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
To amend title XVIII of the Social Security Act to establish additional 
   provisions to combat waste, fraud, and abuse within the Medicare 
                    Program, 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 Fraud 
Prevention and Enforcement Act of 2009''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Site inspections and background checks.
Sec. 3. Registration of billing agencies.
Sec. 4. Expanded access to the health integrity protection database 
                            (HIPDB).
Sec. 5. Liability of medicare carriers and fiscal intermediaries for 
                            claims submitted by excluded providers.
Sec. 6. Community mental health centers.
Sec. 7. Limiting the use of discharge in bankruptcy proceedings for 
                            provider liability for health care fraud.
Sec. 8. Illegal distribution of a medicare or medicaid beneficiary 
                            identification or provider number.
Sec. 9. Treatment of certain Social Security Act crimes as Federal 
                            health care offenses.
Sec. 10. Authority of Office of Inspector General of the Department of 
                            Health and Human Services.
Sec. 11. Universal product numbers on claims forms for reimbursement 
                            under the medicare program.

SEC. 2. SITE INSPECTIONS AND BACKGROUND CHECKS.

    (a) Site Inspections for DME Suppliers, Community Mental Health 
Centers, and Other Provider Groups.--Title XVIII of the Social Security 
Act (42 U.S.C. 1395 et seq.) is amended by adding at the end the 
following:

``site inspections for dme suppliers, community mental health centers, 
                       and other provider groups

    ``Sec. 1899.  (a) Site Inspections.--
            ``(1) In general.--The Secretary shall conduct a site 
        inspection for each applicable provider (as defined in 
        paragraph (2)) that applies for a provider number in order to 
        provide items or services under this title. Such site 
        inspection shall be in addition to any other site inspection 
        that the Secretary would otherwise conduct with regard to an 
        applicable provider.
            ``(2) Applicable provider defined.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), in this section the term `applicable 
                provider' means--
                            ``(i) a supplier of durable medical 
                        equipment (including items described in section 
                        1834(a)(13));
                            ``(ii) a supplier of prosthetics, 
                        orthotics, or supplies (including items 
                        described in paragraphs (8) and (9) of section 
                        1861(s));
                            ``(iii) a community mental health center; 
                        or
                            ``(iv) any other provider group, as 
                        determined by the Secretary.
                    ``(B) Exception.--In this section, the term 
                `applicable provider' does not include--
                            ``(i) a physician that provides durable 
                        medical equipment (as described in subparagraph 
                        (A)(i)) or prosthetics, orthotics, or supplies 
                        (as described in subparagraph (A)(ii)) to an 
                        individual as incident to an office visit by 
                        such individual; or
                            ``(ii) a hospital that provides durable 
                        medical equipment (as described in subparagraph 
                        (A)(i)) or prosthetics, orthotics, or supplies 
                        (as described in subparagraph (A)(ii)) to an 
                        individual as incident to an emergency room 
                        visit by such individual.
    ``(b) Standards and Requirements.--In conducting the site 
inspection pursuant to subsection (a), the Secretary shall ensure that 
the site being inspected is in full compliance with all the conditions 
and standards of participation and requirements for obtaining medicare 
billing privileges under this title.
    ``(c) Time.--The Secretary shall conduct the site inspection for an 
applicable provider prior to the issuance of a provider number to such 
provider.
    ``(d) Timely Review.--The Secretary shall provide for procedures to 
ensure that the site inspection required under this section does not 
unreasonably delay the issuance of a provider number to an applicable 
provider.''.
    (b) Background Checks.--Title XVIII of the Social Security Act (42 
U.S.C. 1395 et seq.) (as amended by subsection (a)) is amended by 
adding at the end the following:

                          ``background checks

    ``Sec. 1899A.  (a) Background Check Required.--Except as provided 
in subsection (b), the Secretary shall conduct a background check on 
any individual or entity that applies to the Secretary for a provider 
number for the purpose of furnishing any item or service under this 
title. In performing the background check, the Secretary shall--
            ``(1) conduct the background check before issuing a 
        provider number to an individual or entity;
            ``(2) include a search of criminal records in the 
        background check; and
            ``(3) provide for procedures that ensure the background 
        check does not unreasonably delay the issuance of a provider 
        number to an eligible individual or entity.
    ``(b) Use of State Licensing Procedure.--The Secretary may use the 
results of a State licensing procedure as a background check under 
subsection (a) if the State licensing procedure meets the requirements 
of subsection (a).
    ``(c) Attorney General Required To Provide Information.--
            ``(1) In general.--Upon request of the Secretary, the 
        Attorney General shall provide the criminal background check 
        information referred to in subsection (a)(2) to the Secretary.
            ``(2) Restriction on use of disclosed information.--The 
        Secretary may only use the information disclosed under 
        subsection (a) for the purpose of carrying out the Secretary's 
        responsibilities under this title.
    ``(d) Refusal To Issue Provider Number.--
            ``(1) Authority.--In addition to any other remedy available 
        to the Secretary, the Secretary may refuse to issue a provider 
        number to an individual or entity if the Secretary determines, 
        after a background check conducted under this section, that 
        such individual or entity has a history of acts that indicate 
        issuance of a provider number to such individual or entity 
        would be detrimental to the best interests of the program or 
        program beneficiaries. Such acts may include--
                    ``(A) any bankruptcy;
                    ``(B) any act resulting in a civil judgment against 
                such individual or entity; or
                    ``(C) any felony conviction under Federal or State 
                law.
            ``(2) Reporting of refusal to issue provider number to the 
        health integrity protection database (hipdb).--A determination 
        to refuse to issue a provider number to an individual or entity 
        as a result of a background check conducted under this section 
        shall be reported to the health integrity protection database 
        established under section 1128E in accordance with the 
        procedures for reporting final adverse actions taken against a 
        health care provider, supplier, or practitioner under that 
        section.''.
    (c) Regulations; Effective Date.--
            (1) Regulations.--Not later than one year after the date of 
        the enactment of this Act, the Secretary of Health and Human 
        Services shall promulgate such regulations as are necessary to 
        implement the amendments made by subsections (a) and (b).
            (2) Effective date.--The amendments made by subsections (a) 
        and (b) shall apply to applications for a provider number 
        received by the Secretary of Health and Human Services on or 
        after the first day of the first year beginning after the date 
        of the enactment of this Act.
    (d) Use of Medicare Integrity Program Funds.--The Secretary of 
Health and Human Services may use funds appropriated or transferred for 
purposes of carrying out the medicare integrity program established 
under section 1893 of the Social Security Act (42 U.S.C. 1395ddd) to 
carry out the provisions of sections 1899 and 1899A of that Act (as 
added by subsections (a) and (b)).

SEC. 3. REGISTRATION OF BILLING AGENCIES.

    (a) Registration of Billing Agencies and Individuals.--Title XVIII 
of the Social Security Act (42 U.S.C. 1395 et seq.) (as amended by 
section 2(b)) is amended by adding at the end the following:

           ``registration of billing agencies and individuals

    ``Sec. 1899B.  (a) Registration.--The Secretary shall establish 
procedures for the registration of all applicable persons.
    ``(b) Required Application.--Each applicable person shall submit a 
registration application to the Secretary at such time, in such manner, 
and accompanied by such information as the Secretary may require.
    ``(c) Identification Number.--If the Secretary approves an 
application submitted under subsection (b), the Secretary shall assign 
a unique identification number to the applicable person.
    ``(d) Requirement.--Every claim for reimbursement under this title 
that is compiled and submitted by an applicable person shall contain 
the identification number that is assigned to the applicable person 
pursuant to subsection (c).
    ``(e) Timely Review.--The Secretary shall provide for procedures 
that ensure the timely consideration and determination regarding 
approval of applications under this section.
    ``(f) Definition of Applicable Person.--In this section, the term 
`applicable person' means an individual or an entity that compiles and 
submits claims for reimbursement under this title to the Secretary on 
behalf of any individual or entity.''.
    (b) Permissive Exclusion.--Section 1128(b) of the Social Security 
Act (42 U.S.C. 1320a-7(b)) is amended by adding at the end the 
following:
            ``(16) Fraud by applicable person.--An applicable person 
        (as defined in section 1899B(f)) that the Secretary determines 
        knowingly submitted or caused to be submitted a claim for 
        reimbursement under title XVIII that the applicable person 
        knows or should know is false or fraudulent.''.
    (c) Regulations; Effective Date.--
            (1) Regulations.--Not later than one year after the date of 
        the enactment of this Act, the Secretary of Health and Human 
        Services shall promulgate such regulations as are necessary to 
        implement the amendments made by subsections (a) and (b).
            (2) Effective date.--The amendments made by subsections (a) 
        and (b) shall take effect on the first day of the first year 
        beginning after the date of the enactment of this Act.

SEC. 4. EXPANDED ACCESS TO THE HEALTH INTEGRITY PROTECTION DATABASE 
              (HIPDB).

    (a) In General.--Section 1128E(d)(1) of the Social Security Act (42 
U.S.C. 1320a-7e(d)(1)) is amended to read as follows:
            ``(1) Availability.--The information in the database 
        maintained under this section shall be available to--
                    ``(A) Federal and State government agencies and 
                health plans, and any health care provider, supplier, 
                or practitioner entering an employment or contractual 
                relationship with an individual or entity who could 
                potentially be the subject of a final adverse action, 
                where the contract involves the furnishing of items or 
                services reimbursed by one or more Federal health care 
                programs (regardless of whether the individual or 
                entity is paid by the programs directly, or whether the 
                items or services are reimbursed directly or indirectly 
                through the claims of a direct provider); and
                    ``(B) utilization and quality control peer review 
                organizations and accreditation entities as defined by 
                the Secretary, including but not limited to 
                organizations described in part B of this title and in 
                section 1154(a)(4)(C).''.
    (b) Criminal Penalty for Misuse of Information.--Section 1128B(b) 
of the Social Security Act (42 U.S.C. 1320a-7b(b)) is amended by adding 
at the end the following:
    ``(4) Whoever knowingly uses information maintained in the health 
integrity protection database maintained in accordance with section 
1128E for a purpose other than a purpose authorized under that section 
shall be imprisoned for not more than three years or fined under title 
18, United States Code, or both.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 5. LIABILITY OF MEDICARE ADMINISTRATIVE CONTRACTORS FOR CLAIMS 
              SUBMITTED BY EXCLUDED PROVIDERS.

    (a) Reimbursement to the Secretary for Amounts Paid to Excluded 
Providers.--Section 1874A(b) of the Social Security Act (42 U.S.C. 
1395kk(b)) is amended by adding at the end the following new paragraph:
            ``(6) Reimbursements to secretary for amounts paid to 
        excluded providers.--The Secretary shall not enter into a 
        contract with a medicare administrative contractor under this 
        section unless the contractor agrees to reimburse the Secretary 
        for any amounts paid by the contractor for a service under this 
        title which is furnished by an individual or entity during any 
        period for which the individual or entity is excluded, pursuant 
        to section 1128, 1128A, or 1156, from participation in the 
        health care program under this title if the amounts are paid 
        after the 60-day period beginning on the date the Secretary 
        provides notice of the exclusion to the contractor, unless the 
        payment was made as a result of incorrect information provided 
        by the Secretary or the individual or entity excluded from 
        participation has concealed or altered their identity.''.
    (b) Conforming Repeal of Mandatory Payment Rule.--Section 1862(e) 
of the Social Security Act (42 U.S.C. 1395y(e)) is amended--
            (1) in paragraph (1)(B), by striking ``and when the 
        person'' and all that follows through ``person)''; and
            (2) by amending paragraph (2) to read as follows:
    ``(2) No individual or entity may bill (or collect any amount from) 
any individual for any item or service for which payment is denied 
under paragraph (1). No individual is liable for payment of any amounts 
billed for such an item or service in violation of the preceding 
sentence.''.
    (c) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to claims for payment submitted on or after the date of 
        enactment of this Act.
            (2) Contract modification.--The Secretary of Health and 
        Human Services shall take such steps as may be necessary to 
        modify contracts entered into, renewed, or extended prior to 
        the date of enactment of this Act to conform such contracts to 
        the provisions of this section.

SEC. 6. COMMUNITY MENTAL HEALTH CENTERS.

    (a) In General.--Section 1861(ff)(3)(B) of the Social Security Act 
(42 U.S.C. 1395x(ff)(3)(B)) is amended by striking ``entity that--'' 
and all that follows and inserting the following: ``entity that--
            ``(i) provides the community mental health services 
        specified in paragraph (1) of section 1913(c) of the Public 
        Health Service Act;
            ``(ii) meets applicable certification or licensing 
        requirements for community mental health centers in the State 
        in which it is located;
            ``(iii) provides a significant share of its services to 
        individuals who are not eligible for benefits under this title; 
        and
            ``(iv) meets such additional standards or requirements for 
        obtaining medicare billing privileges as the Secretary may 
        specify to ensure--
                    ``(I) the health and safety of beneficiaries 
                receiving such services; or
                    ``(II) the furnishing of such services in an 
                effective and efficient manner.''.
    (b) Restriction.--Section 1861(ff)(3)(A) of such Act (42 U.S.C. 
1395x(ff)(3)(A)) is amended by inserting ``other than in an 
individual's home or in an inpatient or residential setting'' before 
the period.
    (c) Effective Date.--The amendments made by this section shall 
apply to items and services furnished on or after the first day of the 
sixth month that begins after the date of the enactment of this Act.

SEC. 7. LIMITING THE DISCHARGE OF DEBTS IN BANKRUPTCY PROCEEDINGS IN 
              CASES WHERE A HEALTH CARE PROVIDER OR A SUPPLIER ENGAGES 
              IN FRAUDULENT ACTIVITY.

    (a) In General.--
            (1) Civil monetary penalties.--Section 1128A(a) of the 
        Social Security Act (42 U.S.C. 1320a-7a(a)) is amended by 
        adding at the end the following: ``Notwithstanding any other 
        provision of law, amounts made payable under this section are 
        not dischargeable under section 727, 944, 1141, 1228, or 1328 
        of title 11, United States Code, or any other provision of such 
        title.''.
            (2) Recovery of overpayment to providers of services under 
        part a of medicare.--Section 1815(d) of the Social Security Act 
        (42 U.S.C. 1395g(d)) is amended--
                    (A) by inserting ``(1)'' after ``(d)''; and
                    (B) by adding at the end the following:
    ``(2) Notwithstanding any other provision of law, amounts due to 
the Secretary under this section are not dischargeable under section 
727, 944, 1141, 1228, or 1328 of title 11, United States Code, or any 
other provision of such title if the overpayment was the result of 
fraudulent activity, as may be defined by the Secretary.''.
            (3) Recovery of overpayment of benefits under part b of 
        medicare.--Section 1833(j) of the Social Security Act (42 
        U.S.C. 1395l(j)) is amended--
                    (A) by inserting ``(1)'' after ``(j)''; and
                    (B) by adding at the end the following:
    ``(2) Notwithstanding any other provision of law, amounts due to 
the Secretary under this section are not dischargeable under section 
727, 944, 1141, 1228, or 1328 of title 11, United States Code, or any 
other provision of such title if the overpayment was the result of 
fraudulent activity, as may be defined by the Secretary.''.
            (4) Collection of past-due obligations arising from breach 
        of scholarship and loan contract.--Section 1892(a) of the 
        Social Security Act (42 U.S.C. 1395ccc(a)) is amended by adding 
        at the end the following:
            ``(5) Notwithstanding any other provision of law, amounts 
        due to the Secretary under this section are not dischargeable 
        under section 727, 944, 1141, 1228, or 1328 of title 11, United 
        States Code, or any other provision of such title.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to bankruptcy petitions filed after the date of the enactment of 
this Act.

SEC. 8. ILLEGAL DISTRIBUTION OF A MEDICARE OR MEDICAID BENEFICIARY 
              IDENTIFICATION OR PROVIDER NUMBER.

    Section 1128B(b) of the Social Security Act (42 U.S.C. 1320a-
7b(b)), as amended by section 4(b), is amended by adding at the end the 
following:
    ``(5) Whoever knowingly, intentionally, and with the intent to 
defraud purchases, sells or distributes, or arranges for the purchase, 
sale, or distribution of two or more medicare or medicaid beneficiary 
identification numbers or provider numbers shall be imprisoned for not 
more than three years or fined under title 18, United States Code (or, 
if greater, an amount equal to the monetary loss to the Federal and any 
State government as a result of such acts), or both.''.

SEC. 9. TREATMENT OF CERTAIN SOCIAL SECURITY ACT CRIMES AS FEDERAL 
              HEALTH CARE OFFENSES.

    (a) In General.--Section 24(a) of title 18, United States Code, is 
amended--
            (1) by striking the period at the end of paragraph (2) and 
        inserting ``; or''; and
            (2) by adding at the end the following:
            ``(3) section 1128B of the Social Security Act (42 U.S.C. 
        1320a-7b).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on the date of the enactment of this Act and apply to acts 
committed on or after the date of the enactment of this Act.

SEC. 10. AUTHORITY OF OFFICE OF INSPECTOR GENERAL OF THE DEPARTMENT OF 
              HEALTH AND HUMAN SERVICES.

    (a) Authority.--Notwithstanding any other provision of law, upon 
designation by the Inspector General of the Department of Health and 
Human Services, any criminal investigator of the Office of Inspector 
General of such department may, in accordance with guidelines issued by 
the Secretary of Health and Human Services and approved by the Attorney 
General, while engaged in activities within the lawful jurisdiction of 
such Inspector General--
            (1) obtain and execute any warrant or other process issued 
        under the authority of the United States;
            (2) make an arrest without a warrant for--
                    (A) any offense against the United States committed 
                in the presence of such investigator; or
                    (B) any felony offense against the United States, 
                if such investigator has reasonable cause to believe 
                that the person to be arrested has committed or is 
                committing that felony offense; and
            (3) exercise any other authority necessary to carry out the 
        authority described in paragraphs (1) and (2).
    (b) Funds.--The Office of Inspector General of the Department of 
Health and Human Services may receive and expend funds that represent 
the equitable share from the forfeiture of property in investigations 
in which the Office of Inspector General participated, and that are 
transferred to the Office of Inspector General by the Department of 
Justice, the Department of the Treasury, or the United States Postal 
Service. Such equitable sharing funds shall be deposited in a separate 
account and shall remain available until expended.

SEC. 11. UNIVERSAL PRODUCT NUMBERS ON CLAIMS FORMS FOR REIMBURSEMENT 
              UNDER THE MEDICARE PROGRAM.

    (a) UPNs on Claims Forms for Reimbursement Under the Medicare 
Program.--
            (1) Accommodation of upns on medicare claims forms.--Not 
        later than July 1, 2010, all claims forms developed or used by 
        the Secretary of Health and Human Services for reimbursement 
        under the medicare program under title XVIII of the Social 
        Security Act (42 U.S.C. 1395 et seq.) shall accommodate the use 
        of universal product numbers for a UPN covered item.
            (2) Requirement for payment of claims.--Title XVIII of the 
        Social Security Act (42 U.S.C. 1395 et seq.), as amended by 
        sections 2(b) and 3(a), is amended by adding at the end the 
        following:

                   ``use of universal product numbers

    ``Sec. 1899C.  (a) In General.--No payment shall be made under this 
title for any claim for reimbursement for any UPN covered item unless 
the claim contains the universal product number of the UPN covered 
item.
    ``(b) Definitions.--In this section:
            ``(1) UPN covered item.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the term `UPN covered item' means--
                            ``(i) a covered item as that term is 
                        defined in section 1834(a)(13);
                            ``(ii) an item described in paragraph (8) 
                        or (9) of section 1861(s);
                            ``(iii) an item described in paragraph (5) 
                        of section 1861(s); and
                            ``(iv) any other item for which payment is 
                        made under this title that the Secretary 
                        determines to be appropriate.
                    ``(B) Exclusion.--The term `UPN covered item' does 
                not include a customized item for which payment is made 
                under this title.
            ``(2) Universal product number.--The term `universal 
        product number' means a number that is--
                    ``(A) affixed by the manufacturer to each 
                individual UPN covered item that uniquely identifies 
                the item at each packaging level; and
                    ``(B) based on commercially acceptable 
                identification standards such as, but not limited to, 
                standards established by the Uniform Code Council-
                International Article Numbering System or the Health 
                Industry Business Communication Council.''.
            (3) Development and implementation of procedures.--
                    (A) Information included in upn.--The Secretary of 
                Health and Human Services, in consultation with 
                manufacturers and entities with appropriate expertise, 
                shall determine the relevant descriptive information 
                appropriate for inclusion in a universal product number 
                for a UPN covered item.
                    (B) Review of procedure.--From the information 
                obtained by the use of universal product numbers on 
                claims for reimbursement under the medicare program, 
                the Secretary of Health and Human Services, in 
                consultation with interested parties, shall 
                periodically review the UPN covered items billed under 
                the Health Care Financing Administration Common 
                Procedure Coding System and adjust such coding system 
                to ensure that functionally equivalent UPN covered 
                items are billed and reimbursed under the same codes.
            (4) Effective date.--The amendment made by paragraph (2) 
        shall apply to claims for reimbursement submitted on and after 
        July 1, 2010.
    (b) Study and Reports to Congress.--
            (1) Study.--The Secretary of Health and Human Services 
        shall conduct a study on the results of the implementation of 
        the provisions in paragraph (1) and (3) of subsection (a) and 
        the amendment to the Social Security Act in paragraph (2) of 
        that subsection.
            (2) Reports.--
                    (A) Progress report.--Not later than six months 
                after the date of the enactment of this Act, the 
                Secretary of Health and Human Services shall submit to 
                Congress a report that contains a detailed description 
                of the progress of the matters studied pursuant to 
                paragraph (1).
                    (B) Implementation.--Not later than 18 months after 
                the date of the enactment of this Act, and annually 
                thereafter for three years, the Secretary of Health and 
                Human Services shall submit to Congress a report that 
                contains a detailed description of the results of the 
                study conducted pursuant to paragraph (1), together 
                with the Secretary's recommendations regarding the use 
                of universal product numbers and the use of data 
                obtained from the use of such numbers.
    (c) Definitions.--In this section:
            (1) UPN covered item.--The term ``UPN covered item'' has 
        the meaning given such term in section 1899C(b)(1) of the 
        Social Security Act (as added by subsection (a)(2)).
            (2) Universal product number.--The term ``universal product 
        number'' has the meaning given such term in section 1899C(b)(2) 
        of the Social Security Act (as added by subsection (a)(2)).
    (d) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary for the purpose of carrying 
out the provisions in paragraphs (1) and (3) of subsection (a), 
subsection (b), and section 1899C of the Social Security Act (as added 
by subsection (a)(2)).
                                 <all>