[Congressional Record Volume 144, Number 74 (Wednesday, June 10, 1998)]
[Senate]
[Pages S6050-S6052]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]





                               footnotes

     \1\ Regulatory Flexibility Act. 5 U.S.C. Sec. 601, as amended 
     by the Small Business Regulatory Enforcement Fairness Act, 
     Pub. L. No. 104-121. 110 Stat. 866 (1996).
     \2\ See 143 Cong. Rec. H6253-6254 (daily ed. July 29, 1997).
     \3\ 143 Cong. Rec. S6159 (daily ed. July 24, 1997) (statement 
     of Sen. Hatch).
     \4\ Id. at S6159-60.
     \5\ Those requirements include basing the amount of the bond 
     on a flat rate in combination with the $50,000 minimum bond. 
     The flat rate is designated as 15 percent of the annual 
     amount paid to the HHA by Medicare as reflected in the HHA's 
     most recently accepted cost report. The other major 
     requirement for new the HHAs is for minimum capitalization. 
     The amount of the reserve is to be determined by Medicare 
     intermediaries based on the first year experience of other 
     HHAs. First the intermediary determines an average cost per 
     visit based on first-year cost report data for at least three 
     HHAs that it serves that are comparable to the HHA seeking to 
     enter the Medicare program. The average cost per visit is 
     determined by dividing the sum of the total reported costs of 
     care for all patients of the HHAs by the sum of their total 
     visits. Then, the intermediary multiplies the average cost 
     per visit by the projected number of visits for all patients 
     (Medicare. Medicaid and all other patients) for the first 
     three months of operation of the HHA asking to inter the 
     program. HCFA also designates which funds count toward 
     satisfying the capitalization requirement (--fifty percent of 
     the funds required for capitalization must be non-borrowed 
     funds) Medicare expects those funds to be available in cash 
     or, in some cases short term highly liquid cash equivalents.
     \6\ 63 Fed. Reg. at 308.
     \7\ In September 1997. President Clinton announced that the 
     Department of Health and Human Services was declaring the 
     first ever moratorium to stop new home health providers from 
     entering the Medicare program. The moratorium was lifted in 
     January after the instant final rules were published in the 
     Federal Register. The Office of Advocacy received at least 
     one call form an anxious home health agency just starting 
     their business. The agency had completed the reams of 
     paperwork and all the other necessary requirements for 
     entering the Medicare program, but had to put everything on 
     hold because of the 4-month moratorium--announced just days 
     before their Medicare application would have been approved. 
     Where is this business going to get three months reserve to 
     demonstrate that their business is adequately capitalized? 
     Unable to enter the Medicare program, how have they survived 
     thus far (when you consider that 95% of home health patients 
     are Medicare eligible)?
     Another business contacted the Office of Advocacy to complain 
     that their home health agency had been audited three times in 
     one year under the Administration's ``Operation Restore 
     Trust.''
     \8\ Some of those statements include the following: ``Because 
     of the scope of the rule, all HHAs will be affected, but we 
     do not expect that effect to be significant.'' 63 Fed. Reg. 
     at 303. ``We expect to have a `significant impact' on an 
     unknown number of such entities, effectively preventing some 
     from repeating their past aberrant billing activities [but, 
     t]he majority of HHAs will not be significantly affected by 
     this rule.'' Id. ``[A]ny possible impact that this 
     [capitalization] requirement may have on HHAs entering the 
     Medicare program is more than offset by savings to the Trust 
     Funds in situations in which HHAs go out of business due to 
     undercapitalization . . .'' Id. at 308. ``We are not 
     preparing a rural impact statement [pursuant to section 
     1102(b) of the Social Security Act] since we have determined, 
     and certify, that this rule would not have a significant 
     impact on the operations of a substantial number of small 
     rural hospitals.'' Id. ``If a new HHA for some reason cannot 
     raise the capital necessary to meet Medicare's 
     [capitalization] requirement and, therefore, is not permitted 
     to enter the Medicare program, that clearly has an impact on 
     the HHA.'' Id.
     \9\ See 13 C.F.R. Sec. 121.201. Based on Standard Industrial 
     Classification code 8082. Home Health Care Services include 
     home health care agencies and visiting nurse associations 
     (establishments primarily engaged in providing skilled 
     nursing or medical care in the home, under supervision of a 
     physician. Establishments of registered or practical nurses 
     engaged in the independent practice of their professions and 
     nurses' registries and classified in another category. 
     Similarly, establishments primarily engaged in selling, 
     renting or leasing health care products for personal or 
     household use are classified in another category).
     \10\ In 1996. $14,357,504,894 was paid to HHAs, 
     $1,061,157,961 was overpaid, and $153,628,056 was 
     uncollected.
     \11\ Senators Ask HCFA to Delay Final Rule Requiring Surety 
     Bonds of All Agencies. BNA Daily Report For Executives. Jan 
     27, 1998, at A-24.
     \12\ Small firms in service industries find it more difficult 
     to obtain credit--where judgments in terms of character, 
     markets, and cash flow are more likely to dominate--than in 
     manufacturing industries, which typically have hard assets 
     such as real property, equipment, and inventory. Office of 
     Advocacy, U.S. Small Business Administration. The State of 
     Small Business: A Report of the President (1995) at 86.
     \13\ Unsure of the actual impact, the agency specifically 
     solicited comments on its assertions and assumptions. See 63 
     Fed. Reg. at 304.

  Mr. BAUCUS. Mr. President, I would like to say a few words about the 
Bond-Baucus-Grassley Joint Resolution introduced today that nullifies a 
regulation which threatens to put many of my state's home health 
agencies, or HHAs, out of business. Our resolution officially 
disapproves the regulation issued by the Health Care Financing 
Administration on June 1 of this year. The rule requires each home 
health agency that receives Medicare reimbursement to buy a costly 
surety bond. This expensive bond is out of reach for many of the 
agencies that provide in-home service to Montana's elderly and low 
income residents.
  Let me say from the outset that I support the provision in the 
Balanced Budget Act of 1997 requiring HHAs to post a surety bond for 
Medicare and Medicaid. Perhaps we need to make some changes to the 
statute, but the underlying idea--to protect the Medicare program by 
requiring home health agencies to post a bond--is a good one. 
Unfortunately, the regulation HCFA plans to implement requires a much 
higher bond amount.
  One Montana home health agency based in Butte would have to post a 
bond of more than $600,000 under the HCFA regulation. That's an 
outrage. And it will put that company, and many others across the 
country, out of business.
  I am also concerned that HCFA has incorrectly interpreted 
Congressional intent by using the bonds to collect on Medicare 
overpayments, not just fraud. As a result, many HHA owners are being 
asked to put up personal assets, such as their house, as collateral for 
the bond. These agencies tend to be non-hospital based and not tied to 
a larger corporate structure. All have far less than $600,000 in 
personal and business assets. We shouldn't expect anyone to sign over 
those assets just to do business in the Medicare program.
  Also, many HHAs are family-owned small businesses. We cannot let any 
federal regulation force small businesses to close their door. This not 
only affects businesses, but also their customers--our bed-ridden 
elderly.
  That is why we have acted here today. The Bond-Baucus-Grassley 
resolution will invoke the Congressional

[[Page S6051]]

Review Act to disapprove HCFA's regulation. And I urge quick action in 
the Senate on this important matter.
                                 ______
                                 
      By Mr. SARBANES (for himself, Mr. Byrd, Mr. Rockefeller, and Ms. 
        Mikulski):
  S.J. Res. 51. A joint resolution granting the consent of Congress to 
the Potomac Highlands Airport Authority Compact entered into between 
the Stats of Maryland and West Virginia; to the Committee on the 
Judiciary.


              POTOMAC HIGHLANDS AIRPORT AUTHORITY COMPACT

  Mr. SARBANES. Mr. President, today I am introducing legislation 
together with my colleagues Senators Byrd, Rockefeller, and Mikulski to 
grant Congressional consent to a Compact entered into between the 
States of West Virginia and Maryland that established the Potomac 
Highlands Airport Authority. The purpose of this legislation is to help 
facilitate a regional approach to the operations, use, management and 
future development of the Greater Cumberland Regional Airport.
  Greater Cumberland Regional Airport is an important transportation 
hub serving the commercial, general aviation and corporate communities 
in the tri-state area of Maryland, Pennsylvania, and West Virginia. It 
is not only an essential link in the region's transportation network, 
but a critical part of the strategy to attract new business and tourism 
to the area.
  The airport was established in 1944, when the City of Cumberland, 
Maryland purchased property in Wiley Ford, WV--three miles south of 
Cumberland--and began construction of airport facilities. 
Unfortunately, this unusual situation--a commercial service airport 
located in one state while owned by a local unit of government in a 
contiguous state--has greatly complicated the operation, financing and 
development of the airport over the years. With two states, two 
counties and two municipalities having jurisdiction over different 
aspects of the airport and enforcing different laws, taxing authorities 
and regulations, it was difficult, at best, to transcend the political 
and boundary lines and achieve a consensus on the future of the 
airport.
  In order to address this situation, in 1976, the General Assemblies 
of the State of Maryland and the State of West Virginia enacted a bi-
state compact authorizing creation of a public agency known as the 
Potomac Highlands Airport Authority (PHAA) to govern and operate the 
airport. However, no action was taken to implement that Compact until 
1990, when the two states, the Board of County Commissioners of 
Allegany County, Maryland and Mineral County, West Virginia and the 
Mayor and City Council of Cumberland, Maryland signed an 
intergovernmental agreement to transfer airport management and control 
to the Authority and changed the name to the Greater Cumberland 
Regional Airport.
  Since that time, the Potomac Highlands Airport Authority has actively 
maintained and operated the airport, and has been working to develop 
and implement a 20-year, $10 million airport modernization and 
expansion program designed to facilitate current operations and 
anticipated growth in utilization of the facility. In the process of 
seeking investment capital, loans and airport development grants, 
questions have been raised by the Federal Aviation Administration, USDA 
Rural Development, and others about the Authority's eligibility to 
function as legal sponsor for the airport and borrow money and give 
security, absent Congressional Consent to the Interstate Compact which 
established the Authority.
  Article I, Section 10 of the Constitution requires Congressional 
approval of compacts between States and Bond Counsel for the airport 
has recommended that the Compact creating the Airport Authority receive 
the consent of Congress in order to provide some certainty as to the 
legal status of the airport and to permit the Authority to borrow 
funds.
  The legislation I am introducing today would ratify the Interstate 
Compact enacted by Maryland and West Virginia in 1976 and reaffirmed in 
the 1990 Intergovernmental Agreement. It will allow the Potomac 
Highlands Airport Authority to fully exercise the powers and authority 
set forth by the Compact and to provide a truly regional approach to 
the operation, use and future development of the airport. It will help 
advance the public interest by ensuring the future viability of Greater 
Cumberland Regional Airport to serve the transportation needs of the 
tri-state area.
  I urge the swift enactment of this legislation and ask unanimous 
consent that the legislation be printed in the Record.
  There being no objection, the joint resolution was ordered to be 
printed in the Record, as follows:

                             S. J. Res. 51

       Resolved by the Senate and House of Representatives of the 
     United States of America in Congress assembled,

     SECTION 1. CONGRESSIONAL CONSENT.

       Congress hereby consents to the Potomac Highlands Airport 
     Authority Compact entered into between the States of Maryland 
     and West Virginia. The compact reads substantially as 
     follows:

             ``Potomac Highlands Airport Authority Compact

     ``SECTION 1. COUNTY COMMISSIONS EMPOWERED TO ENTER INTO 
                   INTERGOVERNMENTAL AGREEMENTS RELATING TO 
                   CUMBERLAND MUNICIPAL AIRPORT.

       ``The county commissions of Mineral County, West Virginia, 
     and of other West Virginia counties contiguous to Mineral 
     County, and the governing bodies of municipal corporations 
     situated in those counties, may enter into intergovernmental 
     agreements with this State, Allegany County, Maryland, other 
     Maryland counties contiguous to Allegany County and 
     Cumberland, Maryland, and other municipal corporations 
     situated in those Maryland counties, and with the Potomac 
     Highlands Airport Authority regarding the operation and use 
     of the Cumberland Municipal Airport situated in Mineral 
     County, West Virginia. The agreements shall be reciprocal in 
     nature and may include, but are not limited to, conditions 
     governing the operation, use, and maintenance of airport 
     facilities, taxation of aircraft owned by Maryland residents 
     and others, and user fees.

     ``SEC. 2. POTOMAC HIGHLANDS AIRPORT AUTHORITY AUTHORIZED.

       ``The county commissions of Mineral County, West Virginia, 
     and of other West Virginia counties contiguous to Mineral 
     County, and the governing bodies of municipal corporations 
     situated in those counties, or any one or more of them, 
     jointly and severally, may create and establish, with proper 
     governmental units of this State, Allegany County, Maryland, 
     other Maryland counties contiguous to Allegany County, and 
     Cumberland, Maryland, and other municipal corporations 
     situated in those Maryland counties, or any one or more of 
     them, a public agency to be known as the `Potomac Highlands 
     Airport Authority' in the manner and for the purposes set 
     forth in this Compact.

     ``SEC. 3. AUTHORITY A CORPORATION.

       ``When created, the Authority and the members of the 
     Authority shall constitute a public corporation and, as such, 
     shall have perpetual succession, may contract and be 
     contracted with, sue and be sued, and have and use a common 
     seal.

     ``SEC. 4. PURPOSES.

       ``The Authority may acquire, equip, maintain, and operate 
     an airport or landing field and appurtenant facilities in 
     Mineral County, on the Potomac River near Ridgeley, West 
     Virginia, to serve the area in which it is located.

     ``SEC. 5. MEMBERS OF AUTHORITY.

       ``(a) In General.--The management and control of the 
     Potomac Highlands Airport Authority, its property, 
     operations, business, and affairs, shall be lodged in a board 
     of seven or more persons who shall be known as members of the 
     Authority and who shall be appointed for terms of three years 
     each by those counties, municipal corporations, or other 
     governmental units situated in West Virginia and Maryland as 
     contribute to the funds of the Authority, in such proportion 
     between those States and counties, municipal corporations, 
     and units, and in whatever manner, as may from time to time 
     be provided in the bylaws adopted by the Authority.
       ``(b) First Board.--The first board shall be appointed as 
     follows:
       ``(1) The County Commission of Mineral County shall appoint 
     two members for terms of two and three years, respectively.
       ``(2) The governing official or body of the municipal 
     corporation of Cumberland, Maryland, shall appoint three 
     members for terms of one, two, and three years, respectively.
       ``(3) The governing official or body of Allegany County, 
     Maryland, shall appoint two members for terms of one and two 
     years, respectively.

     ``SEC. 6. POWERS.

       ``The Potomac Highlands Airport Authority has power and 
     authority as follows:
       ``(1) To make and adopt all necessary bylaws, rules, and 
     regulations for its organization and operations not 
     inconsistent with law.
       ``(2) To take all legal actions necessary or desirable in 
     relation to the general operation, governance, capital 
     expansion, management, and protection of the Cumberland 
     Municipal Airport.

[[Page S6052]]

       ``(3) To increase the number of members of the Authority, 
     and to set the terms of office and appointment procedures for 
     those additional members.
       ``(4) To elect its own officers, to appoint committees, and 
     to employ and fix the compensation for personnel necessary 
     for its operation.
       ``(5) To enter into contracts with any person, firm, or 
     corporation, and generally to do anything necessary for the 
     purpose of acquiring, equipping, expanding, maintaining, and 
     operating an airport.
       ``(6) To delegate any authority given to it by law to any 
     of its officers, committees, agents, or employees.
       ``(7) To apply for, receive, and use grants in aid, 
     donations, and contributions from any sources.
       ``(8) To take or acquire lands by purchase, holding title 
     to it in its own name.
       ``(9) To purchase, own, hold, sell, and dispose of personal 
     property and to sell and dispose of any real estate which it 
     may have acquired and may determine not to be needed for its 
     purposes.
       ``(10) To borrow money.
       ``(11) To extend its funds in the execution of the powers 
     and authority hereby given.
       ``(12) To take all necessary steps to provide for proper 
     police protection at the airport.
       ``(13) To inventory airplanes and other personal property 
     at the airport and provide the assessor of Mineral County and 
     other proper governmental officials with full particulars in 
     regard to the inventory.

     ``SEC. 7. PARTICIPATION BY WEST VIRGINIA.

       ``(a) Appointment of Members; Contribution to Costs.--The 
     county commissions of Mineral County and of counties 
     contiguous to Mineral County, and the governing bodies of 
     municipal corporations situated in those counties, or any one 
     or more of them, jointly and severally, may appoint members 
     of the Authority and contribute to the cost of acquiring, 
     equipping, maintaining, and operating the airport and 
     appurtenant facilities.
       ``(b) Transfer of Property.--Any of the foregoing county 
     commissions or municipal corporations may transfer and convey 
     to the Authority property of any kind acquired previously by 
     the county commission or municipal corporation for airport 
     purposes.

     ``SEC. 8. FUNDS AND ACCOUNTS.

       ``(a) Contribution and Deposit of Funds.--Contributions may 
     be made to the Authority from time to time by the various 
     bodies contributing to its funds and shall be deposited in 
     whatever bank or banks a majority of the members of the 
     Authority direct and may be withdrawn from them in whatever 
     manner the Authority directs.
       ``(b) Accounts and Reports.--The Authority shall keep 
     strict account of all of its receipts and expenditures and 
     shall make quarterly reports to the public and private bodies 
     contributing to its funds, containing an itemized account of 
     its operations in the preceding quarter. The accounts of the 
     Authority shall be regularly examined by the State Tax 
     Commissioner in the manner required by Article nine, Chapter 
     six of the Code of West Virginia.

     ``SEC. 9. PROPERTY AND OBLIGATIONS OF AUTHORITY EXEMPT FROM 
                   TAXATION.

       ``The Authority is exempt from the payment of any taxes or 
     fees to the State of West Virginia or any subdivisions of 
     that State or to any officer or employee of the State or 
     other subdivision of it. The property of the Authority is 
     exempt from all local and municipal taxes. Notes, debentures, 
     and other evidence of indebtedness of the Authority are 
     declared to be issued for a public purpose and to be public 
     instrumentalities, and, together with interest on them, are 
     exempt from taxes.

     ``SEC. 10. SALE OR LEASE OF PROPERTY.

       ``In the event all of the public corporations contributing 
     to the funds of the Authority so determine, the Authority 
     shall make sale of all of its properties and assets and 
     distribute the proceeds of the sale among those contributing 
     to its funds. In the alternative, if such of the supporting 
     corporations contributing a majority of the funds of the 
     Authority so determine, the Authority may lease all of its 
     property and equipment upon whatever terms and conditions the 
     Authority may fix and determine.

     ``SEC. 11. EMPLOYEES TO BE COVERED BY WORKMEN'S COMPENSATION.

       ``All eligible employees of the Authority are considered to 
     be within the Workmen's Compensation Act of West Virginia, 
     and premiums on their compensation shall be paid by the 
     Authority as required by law.

     ``SEC. 12. LIBERAL CONSTRUCTION OF COMPACT.

       ``It is the purpose of this Compact to provide for the 
     maintenance and operation of an airport in a prudent and 
     economical manner, and this Compact shall be liberally 
     construed as giving to the Authority full and complete power 
     reasonably required to give effect to the purposes hereof. 
     The provisions of this Compact are in addition to and not in 
     derogation of any power existing in the county commissions 
     and municipal corporations herein named under any 
     constitutional, statutory, or charter provisions which they 
     or any of them may now have or may hereafter acquire or 
     adopt.''.

     SEC. 2. RIGHT TO ALTER, AMEND, OR REPEAL.

       The right to alter, amend, or repeal this joint resolution 
     is hereby expressly reserved. The consent granted by this 
     joint resolution shall not be construed as impairing or in 
     any manner affecting any right or jurisdiction of the United 
     States in and over the region which forms the subject of the 
     compact.

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