[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 3630 Introduced in Senate (IS)]

<DOC>






118th CONGRESS
  2d Session
                                S. 3630

   To amend title XI of the Social Security Act to establish a pilot 
 program for testing the use of a predictive risk-scoring algorithm to 
    provide oversight of payments for durable medical equipment and 
    clinical diagnostic laboratory tests under the Medicare program.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 18, 2024

Mr. Braun (for himself and Mr. Cassidy) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
   To amend title XI of the Social Security Act to establish a pilot 
 program for testing the use of a predictive risk-scoring algorithm to 
    provide oversight of payments for durable medical equipment and 
    clinical diagnostic laboratory tests under the Medicare program.

    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 ``Medicare Transaction Fraud 
Prevention Act''.

SEC. 2. PILOT PROGRAM TESTING USE OF PREDICTIVE RISK-SCORING ALGORITHM 
              TO PROVIDE OVERSIGHT OF PAYMENTS FOR DURABLE MEDICAL 
              EQUIPMENT AND CLINICAL DIAGNOSTIC LABORATORY TESTS UNDER 
              THE MEDICARE PROGRAM.

    Section 1128K of the Social Security Act (42 U.S.C. 1320a-7n) is 
amended--
            (1) in the section heading by inserting ``; pilot program 
        testing use of predictive risk-scoring algorithm to provide 
        oversight of payments for durable medical equipment and 
        clinical diagnostic laboratory tests under the medicare 
        program'' after ``abuse''; and
            (2) by adding at the end the following new subsection:
    ``(d) Pilot Program Testing Use of Predictive Risk-Scoring 
Algorithm To Provide Oversight of Payments for Durable Medical 
Equipment and Clinical Diagnostic Laboratory Tests Under the Medicare 
Program.--
            ``(1) In general.--The Secretary shall establish a pilot 
        program to test the use of predictive risk-scoring algorithms 
        to provide oversight of relevant transactions (as defined in 
        paragraph (7)(B)).
            ``(2) Duration.--The pilot program shall be conducted for a 
        period of 2 years, beginning not later than January 1, 2025.
            ``(3) Scope.--
                    ``(A) In general.--The Secretary shall limit the 
                implementation of the pilot program to relevant 
                transactions involving applicable items or services 
                furnished to beneficiaries who have opted in to receive 
                electronic Medicare Summary Notices (in this subsection 
                referred to as `applicable beneficiaries').
                    ``(B) Voluntary participation.--An applicable 
                beneficiary may opt out of the pilot program at any 
                time.
            ``(4) Considerations.--The Secretary may, for purposes of 
        identifying and calculating the risks of relevant transactions 
        under the pilot program, consider the following factors:
                    ``(A) The absence of a prior relationship between 
                the beneficiary and a provider of services (as defined 
                in section 1861(u)) or supplier (as defined in section 
                1861(d)).
                    ``(B) Aberrant billing patterns for a provider of 
                services or supplier with regards to volume of claims 
                in one particular area.
                    ``(C) Electronic fund transfer (EFT) changes.
                    ``(D) Changes in ownership of a provider of 
                services or supplier.
            ``(5) Collaboration.--The Secretary shall work with 
        industry representatives (including suppliers of durable 
        medical equipment) on the development and implementation of the 
        pilot program.
            ``(6) Requirements.--Under the pilot program, the Secretary 
        shall--
                    ``(A) adopt a predictive risk-scoring algorithm, 
                modeled similar to leading payment card networks' real-
                time consumer feedback mechanisms, that would learn 
                from beneficiary data to score relevant transactions 
                from 1 (least risky) to 99 (most risky);
                    ``(B) prior to implementation of any predictive 
                risk-scoring algorithm adopted under subparagraph (A) 
                under the pilot program--
                            ``(i) require sufficient testing, 
                        evaluation, and review of such algorithm, 
                        taking into consideration the Blueprint for an 
                        AI Bill of Rights issued by the White House 
                        Office of Science and Technology Policy in 
                        October, 2022;
                            ``(ii) establish methods for notifying 
                        applicable beneficiaries and providers of 
                        services and suppliers impacted by the use of 
                        the algorithm regarding such usage (including 
                        information regarding how beneficiary data is 
                        collected and processed under the pilot program 
                        to produce a risk score for relevant 
                        transactions and the possible implications 
                        associated with the use of the algorithm); and
                            ``(iii) establish methods of communication 
                        with the Office of the Inspector General of the 
                        Department of Health and Human Service, and the 
                        ability to waive or forgo notice to an 
                        applicable beneficiary or a provider of 
                        services or supplier if appropriate;
                    ``(C) for any relevant transaction involving an 
                item or service furnished to an applicable beneficiary 
                identified by a predictive risk-scoring algorithm 
                adopted under subparagraph (A) and implemented under 
                subparagraph (B) as having a risk score that exceeds a 
                level of risk specified by the Secretary--
                            ``(i) review the relevant transaction to 
                        determine whether it should be suspended 
                        pending the applicable beneficiary's response 
                        under clause (ii);
                            ``(ii) provide the applicable beneficiary 
                        the opportunity, by email or phone call 
                        response--
                                    ``(I) to cure a high-risk score or 
                                suspended transaction that the 
                                beneficiary believes is based on 
                                inaccurate underlying data; and
                                    ``(II) confirm the relevant 
                                transaction;
                            ``(iii) if, based on the results of the 
                        review, the relevant transaction is suspended--
                                    ``(I) trigger an automatic alert to 
                                the applicable beneficiary by 
                                electronically sending a Medicare 
                                Summary Notice that includes the 
                                relevant transaction;
                                    ``(II) require that all subsequent 
                                Medicare Summary Notices involving the 
                                relevant transaction be sent 
                                electronically and in two week 
                                intervals for 3 months after the first 
                                alert is sent under subclause (I); and
                                    ``(III) include on such Medicare 
                                Summary Notices, as determined 
                                appropriate by the Secretary, 
                                information explaining how the 
                                beneficiary may report suspected fraud 
                                to relevant law enforcement agencies.
                    ``(D) have the authority to determine when a 
                Medicare card must be terminated or a new card issued 
                to prevent fraud and abuse.
            ``(7) Clarification.--Any suspension of an account or 
        transaction under the pilot program shall be based on a human 
        review process, informed through the implementation of the 
        predictive risk-scoring algorithm.
            ``(8) Definitions.--In this subsection:
                    ``(A) Applicable item or service.--The term 
                `applicable item or service' means--
                            ``(i) an item of durable medical equipment 
                        (as defined in section 1861(n)); and
                            ``(ii) a clinical diagnostic laboratory 
                        test.
                    ``(B) Relevant transaction.--The term `relevant 
                transaction' means a claim for payment for an 
                applicable item or service furnished to an applicable 
                beneficiary, as determined by the Secretary.''.
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