[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2914 Introduced in House (IH)]
113th CONGRESS
1st Session
H. R. 2914
To prevent abusive billing of ancillary services to the Medicare
program, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
August 1, 2013
Ms. Speier (for herself, Ms. Titus, and Mr. McDermott) introduced the
following bill; which was referred to the Committee on Energy and
Commerce, and in addition to the Committee on Ways and Means, 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 prevent abusive billing of ancillary services to 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.
This Act may be cited as the ``Promoting Integrity in Medicare Act
of 2013''.
SEC. 2. FINDINGS; PURPOSES.
(a) Findings.--Congress finds the following:
(1) Recent studies by the Government Accountability Office
(GAO) examining self-referral practices in advanced diagnostic
imaging and anatomic pathology determined that financial
incentives were the most likely cause of increases in self-
referrals.
(2) For advanced diagnostic imaging, GAO stated that
``providers who self-referred made 400,000 more referrals for
advanced imaging services than they would have if they were not
self-referring'', at a cost of ``more than $100 million'' in
2010.
(3) For anatomic pathology, GAO found that ``self-referring
providers likely referred over 918,000 more anatomic pathology
services'' than they would have if they were not self-
referring, costing Medicare approximately $69 million more in
2010 than if self-referral was not permitted.
(4) Noting the rapid growth of services covered by the in-
office ancillary services (IOAS) exception and evidence that
these services are sometimes furnished inappropriately by
referring physicians, the Medicare Payment Advisory Commission
(MedPAC) stated that physician self-referral of ancillary
services creates incentives to increase volume under Medicare's
current fee-for-service payment systems and the rapid volume
growth contributes to Medicare's rising financial burden on
taxpayers and beneficiaries.
(5) According to the Centers for Medicare & Medicaid
Services, a key rationale for the IOAS exception was to permit
physicians to provide ancillary services in their offices to
better inform diagnosis and treatment decisions at the time of
the patient's initial office visit.
(6) It is necessary, therefore, to distinguish between
services and procedures that were intended to be covered by the
IOAS exception, such as routine clinical laboratory services or
simple x-rays that are provided during the patient's initial
office visit, and other health care services which were clearly
not envisioned to be covered by that exception because they
cannot be performed during the patient's initial office visit.
(7) According to a 2010 Health Affairs study, less than 10
percent of CT, MRI, and Nuclear Medicine scans take place on
the same day as the initial patient office visit.
(8) According to a 2012 Health Affairs study, urologists'
self-referrals for anatomic pathology services of biopsy
specimens is linked to increased use and volume billed along
with a lower detection of prostate cancer.
(9) According to an October 2011 Laboratory Economics
report, there has been an increase in the number of anatomic
pathology specimen units billed to the Medicare part B program
from 2006 through 2010, specifically for CPT Code 88305, and
the rate of increase billed by physician offices for this
service is accelerating at a far greater pace than the rest of
the provider segments.
(10) According to a 2013 American Academy of Dermatology
Pathology Billing paper, arrangements involving the split of
the technical and professional components of anatomic pathology
services among different providers may endanger patient safety
and undermine quality of care.
(11) In November 2012, Bloomberg News released an
investigative report that scrutinized ordeals faced by
California prostate cancer patients treated by a urology clinic
that owns radiation therapy equipment. The report found that
physician self-referral resulted in a detrimental impact on
patient care and drove up health care costs in the Medicare
program. The Wall Street Journal, the Washington Post, and the
Baltimore Sun have also published investigations showing that
urology groups owning radiation therapy machines have
utilization rates that rise quickly and are well above national
norms for radiation therapy treatment of prostate cancer.
(12) According to a 2010 MedPAC report, only 3 percent of
outpatient physical therapy services were provided on the same
day as an office visit, only 9 percent within 7 days of an
office visit, and only 14 percent within 14 days of an office
visit. These services are not integral to the physician's
initial diagnosis and do not improve patient convenience
because patients must return for physical therapy treatments.
(13) Those services intended to be covered under the IOAS
exception are not affected by this legislation.
(14) The exception to the ownership or investment
prohibition for rural providers in the ``Stark'' rule is not
affected by this legislation.
(b) Purposes.--The purposes of this Act are the following:
(1) Maintain the in-office ancillary services exception and
preserve its original intent by removing certain complex
services from the exception--specifically, advanced imaging,
anatomic pathology, radiation therapy, and physical therapy.
(2) Protect patients from misaligned provider financial
incentives.
(3) Protect Medicare resources by saving billions of
dollars.
(4) Accomplish the purposes described in paragraphs (1),
(2), and (3) in a manner that does not alter the existing
exception to the ownership or investment prohibition for rural
providers.
SEC. 3. LIMITATION ON APPLICATION OF PHYSICIANS' SERVICES AND IN-OFFICE
ANCILLARY SERVICES EXCEPTIONS.
(a) In General.--Section 1877(b) of the Social Security Act (42
U.S.C. 1395nn(b)) is amended--
(1) in paragraph (1), by inserting ``, other than specified
non-ancillary services,'' after ``section 1861(q))''; and
(2) in paragraph (2), by inserting ``, specified non-
ancillary services,'' after ``(excluding infusion pumps)''.
(b) Increase of Civil Money Penalties.--Section 1877(g) of the
Social Security Act (42 U.S.C. 1395nn(g)) is amended--
(1) in paragraph (3), by inserting ``, unless such bill or
claim included a bill or claim for a specified non-ancillary
service, in which case the civil money penalty shall be not
more than $25,000 for each such service'' before the period at
the end of the first sentence; and
(2) in paragraph (4), by inserting ``(or $150,000 if such
referrals are for specified non-ancillary services)'' after
``$100,000''.
(c) Enhanced Screening of Claims.--Section 1877(g) of the Social
Security Act (42 U.S.C. 1395nn(g)) is further amended by adding at the
end the following new paragraph:
``(7) Compliance review for specified non-ancillary
services.--
``(A) In general.--Not later than 180 days after
the date of the enactment of this paragraph, the
Secretary, in consultation with the Inspector General
of the Department of Health and Human Services, shall
review compliance with subsection (a)(1) with respect
to referrals for specified non-ancillary services in
accordance with procedures established by the
Secretary.
``(B) Factors in compliance review.--Such
procedures--
``(i) shall, for purposes of targeting
types of entities that the Secretary determines
represent a high risk of noncompliance with
subsection (a)(1) with respect to such billing
for such specified non-ancillary services,
apply different levels of review based on such
type; and
``(ii) may include prepayment reviews,
claims audits, focused medical review, computer
algorithms designed to identify payment or
billing anomalies.''.
(d) Definition of Specified Non-Ancillary Services.--Section
1877(h) of the Social Security Act (42 U.S.C. 1395nn(h)) is amended by
adding at the end the following new paragraph:
``(8) Specified non-ancillary services.--The term
`specified non-ancillary service' means a service that the
Secretary has determined is not usually provided and completed
during an office visit to a physician's office in which the
service is determined to be necessary, and includes the
following:
``(A) Anatomic pathology services, as defined by
the Secretary and including the technical or
professional component of the following:
``(i) Surgical pathology.
``(ii) Cytopathology.
``(iii) Hematology.
``(iv) Blood banking.
``(v) Pathology consultation and clinical
laboratory interpretation services.
``(B) Radiation therapy services and supplies, as
defined by the Secretary.
``(C) Advanced diagnostic imaging studies (as
defined in section 1834(e)(1)(B)).
``(D) Physical therapy services (as described in
paragraph (6)(B)).''.
(e) Construction.--Nothing in this section (or the amendments made
by this section) shall be construed to affect the authority of the
Secretary of Health and Human Services to waive the requirements
imposed under the provisions of this section (or such amendments) under
section 1899 of the Social Security Act (42 U.S.C. 1395jjj).
(f) Effective Date.--The amendments made by subsections (a) and (b)
shall apply to items and services furnished on or after the first day
of the first month beginning more than 12 months after the date of the
enactment of this Act.
SEC. 4. CLARIFICATION OF CERTAIN ENTITIES SUBJECT TO STARK RULE AND
ANTI-MARKUP RULE.
Section 1877(h) of the Social Security Act (42 U.S.C. 1395nn(h)) is
further amended by adding at the end the following new paragraph:
``(9) Clarification of certain entities subject to anti-
markup rule.--In applying this section, the term `entity' shall
include a physician's practice when it bills under this title
for the technical component or the professional component of a
specified non-ancillary service, including when such service is
billed in compliance with section 1842(n)(1).''.
SEC. 5. CLARIFICATION OF SUPERVISION OF TECHNICAL COMPONENT OF ANATOMIC
PATHOLOGY SERVICES.
Section 1861(s)(17) of the Social Security Act (42 U.S.C.
1395x(s)(17)) is amended--
(1) by striking ``and'' at the end of subparagraph (A);
(2) by redesignating subparagraph (B) as subparagraph (C);
and
(3) by inserting after subparagraph (A) the following new
subparagraph:
``(B) with regard to the provision of the technical
component of anatomic pathology services, meets the applicable
supervision requirements for laboratories certified in the
subspecialty of histopathology, pursuant to section 353 of the
Public Health Services Act; and''.
SEC. 6. EXEMPTION FROM BUDGET NEUTRALITY UNDER PHYSICIAN FEE SCHEDULE.
Section 1848(c)(2)(B)(v) of the Social Security Act (42 U.S.C.
1395w-4(c)(2)(B)(v)) is amended by adding at the end the following new
subclause:
``(VIII) Changes to limitations on
certain physician referrals.--Effective
for fee schedules established beginning
with 2014, reduced expenditures
attributable to the Promoting Integrity
in Medicare Act of 2013.''.
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