[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 4338 Introduced in Senate (IS)]

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118th CONGRESS
  2d Session
                                S. 4338

To provide for the establishment of hybrid primary care payments under 
             the Medicare program, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 15, 2024

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

_______________________________________________________________________

                                 A BILL


 
To provide for the establishment of hybrid primary care payments under 
             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 ``Pay PCPs Act of 2024''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) Transformation of primary care practices serves as an 
        essential foundation for improving health and life outcomes for 
        Medicare beneficiaries, particularly for those with multiple 
        chronic conditions and complex needs, mental health challenges, 
        or living in rural and other socioeconomically challenged 
        communities.
            (2) Research has shown that 25 percent or more of primary 
        care activities are not recognized for payment under most fee 
        schedules, including the Medicare physician fee schedule, 
        largely because these activities reflect a wide range of high 
        frequency, brief activities that cannot efficiently be paid 
        fee-for-service and because the billing costs for submitting 
        claims for such services would usually exceed the value of 
        payment.
            (3) Fee-for-service is ill-suited to support many elements 
        of practice transformation to produce effective primary care, 
        such as developing and maintaining multi-disciplinary team-
        based care strategies that leverage clinicians such as nurse 
        practitioners, physician assistants, nutritionists, and 
        pharmacists, and coordinating care with other clinicians and 
        social service providers.
            (4) Research has shown that primary care represents a much 
        smaller percentage of total health care spending by payers, 
        regardless of type of insurance coverage, in the United States 
        than in other wealthy nations, and that higher percentage of 
        total spending that is devoted to primary care services is 
        associated with lower overall health care spending, and in the 
        Medicare Shared Savings Program, with higher savings 
        performance by accountable care organizations led by physician 
        groups.
            (5) A composite, prospective payment would provide primary 
        care practices with more predictable and flexible revenues to 
        support such elements of effective primary care and help 
        appropriately value services and activities performed by 
        primary care providers and critical services not currently paid 
        for.
            (6) Payments for some physician services under the Medicare 
        program, including many that produce substantial spending under 
        the Medicare program, have major distortions.
            (7) Determination of payments for physician services under 
        the Medicare program currently begins with subjective survey-
        based estimates of clinician time and effort per discrete 
        service. This approach to valuing physician services is 
        inconsistent with the comprehensive and continuous nature of 
        primary care.
            (8) Studies have found that payment levels in the Medicare 
        physician fee schedule reflect estimates of clinician time per 
        service for a variety of services that are particularly 
        inaccurate.
            (9) The extreme complexity of having more than 8,000 
        billing codes in the Medicare physician fee schedule risks 
        inaccuracy in estimations of relative values for closely 
        related procedures and obscures distortions in pricing that 
        grow over time for specific services.

SEC. 3. ESTABLISHING HYBRID PRIMARY CARE PAYMENT IN MEDICARE.

    (a) Establishment.--The Secretary of Health and Human Services (in 
this section referred to as the ``Secretary'') may establish within the 
Medicare physician fee schedule established under section 1848(b) of 
the Social Security Act (42 U.S.C. 1395w-4(b)), hybrid payments only to 
be available to primary care providers, as defined in the shared 
savings program under section 1899 of such Act (42 U.S.C. 1395jjj).
    (b) Hybrid Payments.--
            (1) In general.--Such hybrid payments may be comprised of 
        the sum of--
                    (A) prospective, per-member-per-month payments; and
                    (B) fee-for-service payments.
            (2) Determination of amount of prospective, per-member-per-
        month payment.--
                    (A) In general.--Subject to the preceding 
                provisions of this subsection, the total prospective, 
                per-member-per-month payment--
                            (i) may represent between 40 and 70 percent 
                        of expected annual total allowed charges 
                        derived from the Medicare physician fee 
                        schedule for primary care providers of services 
                        and suppliers;
                            (ii) should be at least actuarially 
                        equivalent to the applicable physician fee 
                        schedule amounts for the services included 
                        within the total prospective, per-member-per-
                        month payment; and
                            (iii) should be calculated based on 
                        historic Medicare payments for those services 
                        which would be included as part of the 
                        prospective, per-member-per-month payment.
                    (B) Application of certain factors.--The Secretary 
                may consider applying percentages different from those 
                specified in subparagraph (A) for different types of 
                primary care providers based on factors such as 
                historical fee-for-service revenue patterns or quality 
                performance of the provider.
                    (C) Risk adjustment.--The Secretary may assess the 
                need to risk adjust the prospective, per-member-per-
                month payment and develop appropriate risk adjustment 
                methodologies, taking into consideration only those 
                factors that predict levels of primary care service 
                utilization. Risk adjustment methodologies may 
                incorporate clinical diagnoses, demographic factors, 
                and other relevant information such as social 
                determinants of health.
    (c) Categorization of Services.--
            (1) In general.--For such hybrid payments, the Secretary 
        may create categories of different services that are wholly 
        reimbursed under the Medicare physician fee schedule, but may 
        not include services for which reimbursement occurs partly 
        through other payment schedules under the Medicare program.
            (2) Services included in prospective, per-member-per-month 
        payment.--The Secretary may include the following types of 
        services in the prospective, per-member-per-month payment under 
        this section:
                    (A) Care management services.
                    (B) Communications such as emails, phone calls, and 
                patient portals with patients and their caregivers.
                    (C) Behavioral health integration services.
                    (D) Office-based evaluation and management visits, 
                regardless of modality, for new and established 
                patients.
            (3) Clarification regarding fee-for-service payment for 
        other services .--For such hybrid payments, the Secretary may 
        continue to pay through reduced fee-for-service payments for 
        all other services not specified in paragraph (2) under the 
        Medicare physician fee schedule, including screenings, 
        preventive services, annual wellness visits (as defined in 
        section 1861(hhh) of the Social Security Act (42 U.S.C. 
        1395x(hhh))), vaccinations, and initial preventive physical 
        examinations (as defined in section 1861(ww) of such Act (42 
        U.S.C. 1395x(ww))).
    (d) Identification of Quality Measures.--The Secretary may identify 
quality measures with respect to primary care providers that receive 
hybrid payment under this section to safeguard health outcomes for 
Medicare beneficiaries, and reward high quality performance through 
mechanisms such as annual bonus payments. Quality measures may be 
identified using existing mechanisms such as those approved for use in 
the Accountable Care Organization/Patient-Centered Medical Home/Primary 
Care Core Set agreed to by members of the Core Quality Measure 
Collaborative. Measurement may address areas such as--
            (1) patient experience;
            (2) clinical quality measures;
            (3) service utilization, including measures of rates of 
        emergency department visits and hospitalizations; and
            (4) efficiency in referrals, which may include measures of 
        the comprehensiveness of services that the primary care 
        provider furnishes.
    (e) Attribution.--The Secretary shall establish procedures under 
which a beneficiary is attributed to a primary care provider using 
historical claims data and the beneficiary affirms that the provider is 
their primary care provider.
    (f) Exclusion From MIPS.--Section 1848(q)(1)(C)(ii) of the Social 
Security Act (42 U.S.C. 1395w-4(q)(1)(c)(ii)) is amended--
            (1) in subclause (II), by striking ``or'' at the end;
            (2) in subclause (III), by striking the period at the end 
        and inserting ``; or''; and
            (3) by adding at the end the following new subclause:
                                    ``(IV) is a primary care provider 
                                that receives hybrid payments pursuant 
                                to section 3 of the Pay PCPs Act of 
                                2024.''.

SEC. 4. REDUCING BENEFICIARY COST SHARING FOR PRIMARY CARE SERVICES.

    (a) In General.--Notwithstanding any other provision of law, the 
Secretary of Health and Human Services (in this section referred to as 
the ``Secretary'') may reduce by 50 percent any beneficiary cost 
sharing otherwise applicable under part B of title XVIII of the Social 
Security Act (42 U.S.C. 1395j et seq.) for primary care services that 
may be reimbursed through the newly established prospective, per-
member-per-month payment established under section 3, provided that the 
beneficiary designates a primary care provider as their usual source of 
care and informs the Secretary of who that provider is pursuant to the 
procedures established under section 3(e).
    (b) Report to Congress.--Not later than 180 days after the date on 
which subsection (a) is first implemented, and annually thereafter, the 
Secretary shall submit to Congress a report on the implementation of 
such subsection, including an analysis of--
            (1) whether the reduction of beneficiary cost-sharing under 
        such subsection has impacted beneficiary utilization of primary 
        care services that may be reimbursed through the newly 
        established per-member-per-month payment; and
            (2) whether the Secretary has observed any instances of 
        fraud or abuse associated with the reduction of such cost-
        sharing, and whether the Secretary has taken steps to minimize 
        any such fraud or abuse.

SEC. 5. ESTABLISHING A NEW TECHNICAL ADVISORY COMMITTEE ON RELATIVE 
              VALUE UPDATES AND REVISIONS.

    Section 1848(c)(2) of the Social Security Act (42 U.S.C. 1395w-
4(c)(2)) is amended by adding at the end the following new 
subparagraph:
                    ``(P) Establishment of technical advisory committee 
                on relative value updates and revisions.--
                            ``(i) In general.--The Secretary shall 
                        establish a technical advisory committee (in 
                        this section referred to as the `committee') 
                        within the Centers for Medicare & Medicaid 
                        Services to provide the Secretary with 
                        technical input regarding the accurate 
                        determination of relative value units under 
                        this paragraph.
                            ``(ii) Membership.--
                                    ``(I) In general.--The committee 
                                shall be composed of 13 members 
                                appointed by the Secretary from among 
                                individuals--
                                            ``(aa) reflecting diverse 
                                        experiences in provider 
                                        payment, including providers 
                                        billing the Medicare program 
                                        under this title, providers 
                                        providing care under the laws 
                                        administered by the Secretary 
                                        of Veterans Affairs or the 
                                        Secretary of Defense, and 
                                        providers in primary care or 
                                        family medicine (as defined for 
                                        purposes of the shared savings 
                                        program under section 1899); 
                                        and
                                            ``(bb) with technical 
                                        expertise in Medicare payment 
                                        policies.
                                    ``(II) Chair.--1 of the members 
                                appointed under subclause (I) shall be 
                                a representative of personnel of the 
                                Centers for Medicare & Medicaid 
                                Services, and that member shall serve 
                                as chair of the committee.
                            ``(iii) Staff.--The committee shall be 
                        staffed by personnel of the Centers for 
                        Medicare & Medicaid Services.
                            ``(iv) Duties.--The committee shall advise 
                        the Secretary on an ongoing basis regarding the 
                        determination of relative value units under the 
                        physician fee schedule through duties such as 
                        the following:
                                    ``(I) Designing new valuation 
                                methodologies the Secretary may use to 
                                determine the time and resource use by 
                                health professionals associated with 
                                furnishing services or other new 
                                approaches to determining relative 
                                resources for each HCPCS code. The 
                                committee may prioritize furnished 
                                services that are most common or 
                                represent the services with the highest 
                                allowed charges.
                                    ``(II) Advising on research and 
                                development relevant to the 
                                determination of relative value units 
                                for individual HCPCS codes.
                                    ``(III) Providing recommendations 
                                with respect to changes in valuations 
                                of current HCPCS codes based upon any 
                                newly developed valuation 
                                methodologies.
                                    ``(IV) Evaluating whether existing 
                                HCPCS codes within the same family of 
                                services should be collapsed to result 
                                in fewer payment codes.
                                    ``(V) Identifying opportunities for 
                                bundling or unbundling services for 
                                payment purposes.
                                    ``(VI) Assessing the operational 
                                burden of new approaches on physicians 
                                and other suppliers and beneficiaries 
                                while also considering the 
                                vulnerabilities of new approaches on 
                                overt fraud and abuse.
                                    ``(VII) Assessing the impacts of 
                                these new approaches and potential 
                                adoption on beneficiary access, 
                                financial liabilities, quality of care, 
                                and health disparities.
                            ``(v) Funding.--
                                    ``(I) Implementation.--The 
                                Secretary may provide for the transfer, 
                                from the Federal Supplementary Medical 
                                Insurance Trust Fund under section 
                                1841, such amounts as are necessary to 
                                carry out this subsection (other than 
                                research and development under clause 
                                (iv)(II)) (not to exceed $5,000,000) 
                                for each of fiscal years 2025 through 
                                2029. Any amounts transferred under the 
                                preceding sentence for a fiscal year 
                                shall remain available until expended.
                                    ``(II) Research and development.--
                                The Secretary may provide for the 
                                transfer, from the Federal 
                                Supplementary Medical Insurance Trust 
                                Fund under section 1841, such amounts 
                                as are necessary to carry out research 
                                and development under clause (iv)(II) 
                                (not to exceed $10,000,000) for each of 
                                fiscal years 2025 through 2029. Any 
                                amounts transferred under the preceding 
                                sentence for a fiscal year shall remain 
                                available until expended.
                            ``(vi) Duration.--The Commission shall 
                        terminate not later than the expiration of the 
                        5-year period beginning on the date of its 
                        establishment.''.
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