[Congressional Record Volume 145, Number 9 (Wednesday, January 20, 1999)]
[Senate]
[Pages S756-S759]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. GRASSLEY (for himself and Mr. Breaux):
  S. 255. A bill to combat waste, fraud, and abuse in payments for home 
health services provided under the Medicare program, and to improve the 
quality of those home health services; read twice.


             HOME HEALTH INTEGRITY PRESERVATION ACT OF 1999

  Mr. GRASSLEY. Mr. President, earlier today, I introduced the Home 
Health Integrity Preservation Act of 1999. I am pleased that Senator 
Breaux cosponsored this bill, as he did when we introduced it in the 
105th Congress. This legislation will be an important tool in combating 
the waste, fraud and abuse that has threatened the integrity of the 
Medicare home health benefit.
  Although the majority of home health agencies are honest, legitimate, 
businesses, it is clear that there have been unscrupulous providers. In 
July 1997, the Senate Special Committee on Aging, which I chair, held a 
hearing on this topic. The hearing exposed serious rip-offs of the 
Medicare trust fund, and highlighted areas that need more stringent 
oversight.
  In response to the hearing, Senator Breaux and I followed up with a 
roundtable discussion on home health fraud. The roundtable brought 
together key players with a variety of perspectives. Participants 
included law enforcement, the Administration, and the home health 
industry.
  The roundtable yielded a number of proposals which were shaped into 
draft legislation and circulated to a wide variety of stakeholders. In 
response to comments, the draft was changed to address legitimate 
concerns that were raised. The result is a balanced piece of 
legislation that includes important safeguards against fraud and abuse 
of the system, but does not stifle the growth of legitimate providers.
  The Home Health Integrity Preservation Act of 1999 would do the 
following:
  It would heighten scrutiny of new home health agencies before they 
enter the Medicare program, and during their early years of Medicare 
participation.
  It would improve standards and screening for home health agencies, 
administrators and employees.
  It would require audits of home health agencies whose claims exhibit 
unusual features that may indicate problems, and improve HCFA's ability 
to identify such features.
  It would require agencies to adopt and implement fraud and abuse 
compliance programs.
  It would increase scrutiny of branch offices, business entities 
related to home health agencies, and changes in operations.
  It would make more information on particular home health agencies 
available to beneficiaries.
  It would create an interagency Home Health Integrity Task Force, led 
by the Office of the Inspector General of Health and Human Services.
  It would reform bankruptcy rules to make it harder for all Medicare 
providers, not just home health agencies, to avoid penalties and 
repayment obligations by declaring bankruptcy.
  This legislation is an important step in ensuring that seniors 
maintain access to high quality home care services rendered by 
reputable providers. I urge my colleagues to join me in this effort by 
cosponsoring this important legislation.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 255

       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 ``Home 
     Health Integrity Preservation Act of 1999''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Additional conditions of participation for home health 
              agencies.
Sec. 3. Surveyor training in reimbursement and coverage policies.

[[Page S757]]

Sec. 4. Surveys and reviews.
Sec. 5. Prior patient load.
Sec. 6. Establishment of standards and procedures to improve quality of 
              services.
Sec. 7. Notification of availability of a home health agency's most 
              recent survey as part of discharge planning process.
Sec. 8. Home health integrity task force.
Sec. 9. Application of certain provisions of the bankruptcy code.
Sec. 10. Study and report to Congress.
Sec. 11. Effective date.

     SEC. 2. ADDITIONAL CONDITIONS OF PARTICIPATION FOR HOME 
                   HEALTH AGENCIES.

       (a) Qualifications of Managing Employees.--Section 1891(a) 
     of the Social Security Act (42 U.S.C. 1395bbb(a)) is amended 
     by adding at the end the following:
       ``(7) The agency shall have--
       ``(A) sufficient knowledge, as attested by the managing 
     employees (as defined in section 1126(b)) of the agency 
     (pursuant to subsection (c)(2)(C)(iv)(II)) using standards 
     established by the Secretary, of the requirements for 
     reimbursement under this title, coverage criteria and claims 
     procedures, and the civil and criminal penalties for 
     noncompliance with such requirements; and
       ``(B) managing employees with sufficient prior education or 
     work experience, according to standards determined by the 
     Secretary, in the delivery of health care.''.
       (b) Compliance Program.--Section 1891(a) of the Social 
     Security Act (42 U.S.C. 1395bbb(a)) (as amended by subsection 
     (a)) is amended by adding at the end the following:
       ``(8) The agency has developed and implemented a fraud and 
     abuse compliance program.''.
       (c) Availability of Survey.--Section 1891(a) of the Social 
     Security Act (42 U.S.C. 1395bbb(a)) (as amended by subsection 
     (b)) is amended by adding at the end the following:
       ``(9) The agency, before the agency provides any home 
     health services to a beneficiary, makes available to the 
     beneficiary or the representative of the beneficiary a 
     summary of the pertinent findings (including a list of any 
     deficiencies) of the most recent survey of the agency 
     relating to the compliance of such agency. Such summary shall 
     be provided in a standardized format and may, at the 
     discretion of the Secretary, also include other information 
     regarding the agency's operations that are of potential 
     interest to beneficiaries, such as the number of patients 
     served by the agency.''.
       (d) Notice of New Home Health Service, New Branch Office, 
     and New Joint Venture.--Section 1891(a)(2) of the Social 
     Security Act (42 U.S.C. 1395bbb(a)(2)) is amended to read as 
     follows:
       ``(2)(A) The agency notifies the agency's fiscal 
     intermediary and the State entity responsible for the 
     licensing or certification of the agency--
       ``(i) of a change in the persons with an ownership or 
     control interest (as defined in section 1124(a)(3)) in the 
     agency,
       ``(ii) of a change in the persons who are officers, 
     directors, agents, or managing employees (as defined in 
     section 1126(b)) of the agency,
       ``(iii) of a change in the corporation, association, or 
     other company responsible for the management of the agency,
       ``(iv) that the agency is providing a category of skilled 
     service that it was not providing at the time of the agency's 
     most recent standard survey,
       ``(v) that the agency is operating a new branch office that 
     was not in operation at the time of the agency's most recent 
     standard survey, and
       ``(vi) that the agency is involved in a new joint venture 
     with other health care providers or other business entities.
       ``(B) The notice required under subparagraph (A) shall be 
     provided--
       ``(i) for a change described in clauses (i), (ii), and 
     (iii) of such subparagraph, within 30 calendar days of the 
     time of the change and shall include the identity of each new 
     person or company described in the previous sentence,
       ``(ii) for a change described in clause (iv) of such 
     subparagraph, within 30 calendar days of the time the agency 
     begins providing the new service and shall include a 
     description of the service,
       ``(iii) for a change described in clause (v) of such 
     subparagraph, within 30 calendar days of the time the new 
     branch office begins operations and shall include the 
     location of the office and a description of the services that 
     are being provided at the office, and
       ``(iv) for a change described in clause (vi) of such 
     subparagraph, within 30 calendar days of the time the agency 
     enters into the joint venture agreement and shall include a 
     description of the joint venture and the participants in the 
     joint venture.''.

     SEC. 3. SURVEYOR TRAINING IN REIMBURSEMENT AND COVERAGE 
                   POLICIES.

       Section 1891(d)(3) of the Social Security Act (42 U.S.C. 
     1395bbb(d)(3)) is amended--
       (1) by striking ``relating to the performance'' and 
     inserting ``relating to--
       ``(A) the performance'';
       (2) by striking the period at the end and inserting ``; 
     and''; and
       (3) by adding at the end the following:
       ``(B) requirements for reimbursement and coverage of 
     services under this title.''.

     SEC. 4. SURVEYS AND REVIEWS.

       (a) Additional Requirements for Survey.--Section 
     1891(c)(2)(C) of the Social Security Act (42 U.S.C. 
     1395bbb(c)(2)(C)) is amended--
       (1) in clause (i)(I)--
       (A) by striking ``purpose of evaluating'' and inserting 
     ``purpose of--
       ``(aa) evaluating''; and
       (B) by adding at the end the following:
       ``(bb) evaluating whether the individuals are homebound for 
     purposes of qualifying for receipt of benefits for home 
     health services under this title; and'';
       (2) in clause (ii), by striking ``and'' at the end;
       (3) in clause (iii), by striking the period at the end and 
     inserting ``; and''; and
       (4) by adding at the end the following:
       ``(iv) shall include--
       ``(I) an assessment of whether the agency is in compliance 
     with all of the conditions of participation and requirements 
     specified in or pursuant to section 1861(o), this section, 
     and this title;
       ``(II) an assessment that the managing employees (as 
     defined in section 1126(b)) of the agency have attested in 
     writing to having sufficient knowledge, as determined by the 
     Secretary, of the requirements for reimbursement under this 
     title, coverage criteria and claims procedures, and the civil 
     and criminal penalties for noncompliance with such 
     requirements; and
       ``(III) a review of the services provided by subcontractors 
     of the agency to ensure that such services are being provided 
     in a manner consistent with the requirements of this 
     title.''.
       (b) Additional Events Triggering a Survey.--Section 
     1891(c)(2)(B) of the Social Security Act (42 U.S.C. 
     1395bbb(c)(2)(B)) is amended--
       (1) by striking ``and'' at the end of clause (i);
       (2) by striking the period at the end of clause (ii) and 
     inserting a comma; and
       (3) by adding at the end the following:
       ``(iii) shall be conducted not less than annually for the 
     first 2 years after the initial standard survey of the 
     agency,
       ``(iv) after the agency's first 2 years of participation 
     under this title, shall be conducted within 90 calendar days 
     of the date that the agency notifies the Secretary that it is 
     providing a category of skilled service that the agency was 
     not providing at the time of the agency's most recent 
     standard survey,
       ``(v) if the agency is operating a new branch office that 
     was not in operation at the time of the agency's most recent 
     standard survey, shall be conducted within the 12-month 
     period following the date that the new branch office began 
     operations to ensure that such office is providing quality 
     care and that it is appropriately classified as a branch 
     office, and shall include direct scrutiny of the operations 
     of the branch office, and
       ``(vi) shall be conducted on randomly selected agencies on 
     an occasional basis, with the number of such surveys to be 
     determined by the Secretary.''.
       (c) Review by Fiscal Intermediary.--Section 1816 of the 
     Social Security Act (42 U.S.C. 1395h) is amended by adding at 
     the end the following:
       ``(m) An agreement with an agency or organization under 
     this section shall require that the agency or organization 
     conduct a review of the overall business structure of a home 
     health agency submitting a claim for reimbursement for home 
     health services, including any related organizations of the 
     home health agency.''.

     SEC. 5. PRIOR PATIENT LOAD.

       Section 1891 of the Social Security Act (42 U.S.C. 1395bbb) 
     is amended by adding at the end the following:
       ``(h) Prior Patient Load.--
       ``(1) In general.--The Secretary shall not enter into an 
     agreement for the first time with a home health agency to 
     provide items and services under this title unless the 
     Secretary determines that, before the date the agreement is 
     entered into, the agency--
       ``(A) had been in operation for at least 60 calendar days; 
     and
       ``(B) had at least 10 patients during that period of prior 
     operation.
       ``(2) Exceptions.--
       ``(A) Beneficiary access.--If the Secretary determines 
     appropriate, the Secretary may waive the requirements of 
     paragraph (1) in order to establish or maintain beneficiary 
     access to home health services in an area.
       ``(B) Change of ownership.--The requirements of paragraph 
     (1) shall not apply to a home health agency at the time of a 
     change in ownership of such agency.''.

     SEC. 6. ESTABLISHMENT OF STANDARDS AND PROCEDURES TO IMPROVE 
                   QUALITY OF SERVICES.

       (a) In General.--Section 1891 of the Social Security Act 
     (42 U.S.C. 1395bbb) (as amended by section 5) is amended by 
     adding at the end the following:
       ``(i) Establishment of Standards and Procedures.--
       ``(1) Screening of employees.--The Secretary shall 
     establish procedures to improve the background screening 
     performed by a home health agency on individuals that the 
     agency is considering hiring as home health aides (as defined 
     in subsection (a)(3)(E)) and licensed health professionals 
     (as defined in subsection (a)(3)(F)).
       ``(2) Cost reports.--The Secretary shall establish 
     additional procedures regarding the requirement for 
     attestation of cost reports to ensure greater accountability 
     on the part of a home health agency and its managing 
     employees (as defined in section 1126(b)) for the accuracy of 
     the information provided to the Secretary in any such cost 
     reports.
       ``(3) Monitoring agency after extended survey.--The 
     Secretary shall establish procedures to ensure that a home 
     health agency

[[Page S758]]

     that is subject to an extended (or partial extended) survey 
     is closely monitored from the period immediately following 
     the extended survey through the agency's subsequent standard 
     survey to ensure that the agency is in compliance with all 
     the conditions of participation and requirements specified in 
     or pursuant to section 1861(o), this section, and this title.
       ``(4) Additional audits.--
       ``(A) In general.--
       ``(i) Standards.--The Secretary shall establish objective 
     standards regarding the determination of--

       ``(I) whether an agency is a home health agency described 
     in subparagraph (B); and
       ``(II) the circumstances that trigger an audit for a home 
     health agency described in subparagraph (B), and the content 
     of such an audit.

       ``(ii) Information.--In establishing standards under clause 
     (i), the Secretary shall ensure that the individuals 
     performing the audits under this section are provided with 
     the necessary information, including information from 
     intermediaries, carriers, and law enforcement sources, in 
     order to determine if a particular home health agency is an 
     agency described in subparagraph (B) and whether the 
     circumstances triggering an audit for such an agency has 
     occurred.
       ``(B) Agency described.--A home health agency is described 
     in this subparagraph if it is an agency that has--
       ``(i) experienced unusually rapid growth as compared to 
     other home health agencies in the area and in the country;
       ``(ii) had unusually high utilization patterns as compared 
     to other home health agencies in the area and in the country;
       ``(iii) unusually high costs per patient as compared to 
     other home health agencies in the area and in the country;
       ``(iv) unusually high levels of overpayment or coverage 
     denials as compared to other home health agencies in the area 
     and in the country; or
       ``(v) operations that otherwise raise concerns such that 
     the Secretary determines that an audit is appropriate.
       ``(5) Branch offices.--
       ``(A) Surveys.--The Secretary shall establish standards for 
     periodic surveys of branch offices of a home health agency in 
     order to assess whether the branch offices meet the 
     Secretary's national criteria for branch office designation 
     and for quality of care. Such surveys shall include home 
     visits to beneficiaries served by the branch office (but only 
     with the consent of the beneficiary).
       ``(B) Uniform national definition.--The Secretary shall 
     establish a uniform national definition of a branch office of 
     a home health agency.
       ``(6) Certain qualifications of managing employees.--The 
     Secretary shall establish standards regarding the knowledge 
     and prior education or work experience that a managing 
     employee (as defined in section 1126(b)) of an agency must 
     possess in order to comply with the requirements described in 
     subsection (a)(7).
       ``(7) Claims processing.--
       ``(A) In general.--The Secretary shall establish standards 
     to improve and strengthen the procedures by which claims for 
     reimbursement by home health agencies are identified as being 
     fraudulent, wasteful, or abusive.
       ``(B) Procedures.--The standards established by the 
     Secretary pursuant to subparagraph (A) shall include, to the 
     extent practicable, standards for a minimum number of--
       ``(i) intensive focused medical reviews of the services 
     provided to beneficiaries by an agency;
       ``(ii) interviews with beneficiaries, employees of the 
     agency, and other individuals providing services on behalf of 
     the agency; and
       ``(iii) random spot checks of visits to a beneficiary's 
     home by employees of the agency (but only with the consent of 
     the beneficiary).
       ``(C) Report to congress.--Not later than 90 days after the 
     date of enactment of the Home Health Integrity Preservation 
     Act of 1999, the Secretary shall submit a report to Congress 
     containing a detailed description of--
       ``(i) the current levels of activity by the Secretary with 
     regard to the reviews, interviews, and spot checks described 
     in subparagraph (B); and
       ``(ii) the Secretary's plans to increase those levels 
     pursuant to the procedures described in subparagraphs (A) and 
     (B).
       ``(8) Expansion of financial statement.--The Secretary 
     shall establish procedures to expand the financial statement 
     audit process to include compliance and integrity reviews.''.
       (b) Effective Date.--By not later than 180 calendar days 
     after the date of enactment of this Act, the Secretary shall 
     establish the standards and procedures described in 
     paragraphs (1) through (8) of section 1891(i) of the Social 
     Security Act (42 U.S.C. 1395bbb(i)) (as added by subsection 
     (a)) by regulation or other sufficient means.

     SEC. 7. NOTIFICATION OF AVAILABILITY OF A HOME HEALTH 
                   AGENCY'S MOST RECENT SURVEY AS PART OF 
                   DISCHARGE PLANNING PROCESS.

       Section 1861(ee)(2)(D) of the Social Security Act (42 
     U.S.C. 1395x(ee)(2)(D)) (as amended by section 4321(a) of the 
     Balanced Budget Act of 1997) is amended--
       (1) by striking ``including the availability'' and 
     inserting ``including--
       ``(i) the availability''; and
       (2) by inserting before the period the following: ``; and
       ``(ii) the availability of (and procedures for obtaining 
     from a home health agency) a summary document described in 
     section 1891(a)(9)''.

     SEC. 8. HOME HEALTH INTEGRITY TASK FORCE.

       (a) Establishment.--The Secretary of Health and Human 
     Services (in this section referred to as the ``Secretary'') 
     shall establish within the Office of the Inspector General of 
     the Department of Health and Human Services a home health 
     integrity task force (in this section referred to as the 
     ``Task Force'').
       (b) Director.--The Inspector General of the Department of 
     Health and Human Services shall appoint the Director of the 
     Task Force.
       (c) Duties.--The Task Force shall target, investigate, and 
     pursue any available civil or criminal actions against 
     individuals who organize, direct, finance, or are otherwise 
     engaged in fraud in the provision of home health services (as 
     defined in section 1861(m) of the Social Security Act (42 
     U.S.C. 1395x(m))) under the medicare program under such Act.
       (d) Outside Agencies and Entities.--In carrying out the 
     duties described in subsection (c), the Task Force shall work 
     in coordination with other Federal, State, and local 
     agencies, including the Health Care Financing Administration, 
     and with private entities. All Federal, State, and local 
     employees and all private entities are encouraged to provide 
     maximum cooperation to the Task Force.

     SEC. 9. APPLICATION OF CERTAIN PROVISIONS OF THE BANKRUPTCY 
                   CODE.

       (a) Restricted Applicability of Bankruptcy Stay, Discharge, 
     and Preferential Transfer Provisions to Certain Medicare 
     Debts.--Title XI of the Social Security Act (42 U.S.C. 1301 
     et seq.) is amended by inserting after section 1143 the 
     following:


       ``application of certain provisions of the bankruptcy code

       ``Sec. 1144. (a) Certain Medicare Actions Not Stayed by 
     Bankruptcy Proceedings.--The commencement or continuation of 
     any action against a debtor (as defined in subsection (d)) 
     under this title or title XVIII, including any action or 
     proceeding to exclude or suspend such debtor from program 
     participation, assess civil monetary penalties, recoup or set 
     off overpayments, or deny or suspend payment of claims shall 
     not be subject to a stay under section 362(a) of title 11, 
     United States Code.
       ``(b) Certain Medicare Debt Not Dischargeable in 
     Bankruptcy.--A debt owed to the United States or to a State 
     by a debtor for an overpayment under title XVIII, or for a 
     penalty, fine, or assessment under this title or title XVIII, 
     shall not be dischargeable under any provision of title 11, 
     United States Code.
       ``(c) Repayment of Certain Debts Considered Final.--
     Payments made to repay a debt to the United States or to a 
     State by a debtor with respect to items and services 
     provided, or claims for payment made for such items and 
     services, under title XVIII (including repayment of an 
     overpayment), or to pay a penalty, fine, or assessment under 
     this title or title XVIII, shall be considered final and not 
     avoidable transfers under section 547 of title 11, United 
     States Code.
       ``(d) Debtor Defined.--In this section, the term `debtor' 
     means a provider of services (as defined in section 1861(u)) 
     that has commenced a case under title 11, United States 
     Code.''.
       (b) Medicare Rules Applicable to Bankruptcy Proceedings of 
     a Medicare Provider of Services.--Title XVIII of the Social 
     Security Act (42 U.S.C. 1395 et seq.) is amended by adding at 
     the end the following:


           ``application of provisions of the bankruptcy code

       ``Sec. 1897. (a) Use of Medicare Standards and 
     Procedures.--Notwithstanding any provision of title 11, 
     United States Code, or any other provision of law, in the 
     case of claims by a debtor (as defined in section 1144(d)) 
     for payment under this title, the determination of whether 
     the claim is allowable, and of the amount payable, shall be 
     made in accordance with the provisions of this title, title 
     XI, and implementing regulations.
       ``(b) Notice to Creditor of Bankruptcy Petitioner.--In the 
     case of a debt owed by a debtor (as so defined) to the United 
     States with respect to items and services provided, or claims 
     for payment made, under this title (including a debt arising 
     from an overpayment or a penalty, fine, or assessment under 
     title XI or this title), the notices to the creditor of 
     bankruptcy petitions, proceedings, and relief required under 
     title 11, United States Code (including under section 342 of 
     that title and rule 2002(j) of the Federal Rules of 
     Bankruptcy Procedure), shall be given to the Secretary. 
     Provision of such notice to a fiscal agent of the Secretary 
     shall not be considered to satisfy this requirement.
       ``(c) Turnover of Property to the Bankruptcy Estate.--For 
     purposes of section 542(b) of title 11, United States Code, a 
     claim for payment under this title shall not be considered to 
     be a matured debt payable to the estate of a debtor (as so 
     defined) until such claim has been allowed by the Secretary 
     in accordance with procedures established under this 
     title.''.

     SEC. 10. STUDY AND REPORT TO CONGRESS.

       (a) Study.--

[[Page S759]]

       (1) In general.--The Secretary of Health and Human Services 
     (in this section referred to as the ``Secretary'') shall 
     conduct a study on all matters relating to the appropriate 
     home health services to be provided under the medicare 
     program under title XVIII of the Social Security Act (42 
     U.S.C. 1395 et seq.) to individuals with chronic conditions.
       (2) Matters studied.--The matters studied by the Secretary 
     shall include--
       (A) methods to strengthen the role of a physician in 
     developing a plan of care for a beneficiary receiving home 
     health benefits under this title; and
       (B) the need for an individual or entity (other than the 
     home health agency or the beneficiary's physician) to have 
     responsibility for approving the type and quantity of home 
     health services provided to the beneficiary.
       (b) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit a report to 
     Congress on the study conducted under subsection (a). The 
     Secretary shall include in the report such recommendations 
     regarding the utilization of home health services under the 
     medicare program as the Secretary determines to be 
     appropriate.

     SEC. 11. EFFECTIVE DATE.

       Except as otherwise provided in this Act, the amendments 
     made by this Act shall take effect on the expiration of the 
     date that is 180 calendar days after the date of enactment of 
     this Act.
                                 ______