[Congressional Record Volume 145, Number 125 (Thursday, September 23, 1999)]
[Senate]
[Pages S11363-S11365]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. HATCH (for himself, Mr. Nickles, Mr. Breaux, Mr. Grassley, 
        Mr. Murkowski, and Mr. Bayh):
  S. 1626. A bill to amend title XVIII of the Social Security Act to 
improve the process by which the Secretary of Health and Human Services 
makes coverage determinations for items and services furnished under 
the Medicare Program, and for other purposes; to the Committee on 
Finance.


         The Medicare Patient Access to Technology Act of 1999

  Mr. HATCH. Mr. President, I rise to introduce the Medicare Patient 
Access to Technology Act of 1999. I am pleased to be joined by the 
distinguished Assistant Majority Leader, Senator Nickles, and Senators 
Breaux, Grassley, Murkowski, and Bayh in introducing this legislation.
  While we all recognize that medical technologies and treatments are 
improving the lives of millions of Americans daily, gaining access to 
these innovations is becoming more difficult. Each day, new implantable 
medical devices are correcting or repairing failing organ systems in 
patients. People are receiving new tests that permit the diagnosis of 
diseases in their earliest stages without the use of surgery or other 
more complicated procedures.

[[Page S11364]]

Tens of thousands of individuals owe their lives to small, powerful 
miniature devices that monitor and regulate vital physiological 
functions and allow patients to live more productive lives.
  The latest advances in pharmaceutical and biologics are not only 
extending the length of life, but significantly improving the quality 
of life for hundreds of millions of people. Lifesaving and life-
enhancing innovations must be available to all Americans, and it is our 
duty to ensure that those patients who need them most, America's nearly 
40 million Medicare beneficiaries, have access to them.
  As part of the Balanced Budget Act (BBA) of 1997, we authorized the 
Health Care Financing Administration (HCFA) to adjust periodically 
Medicare's coverage and payment systems to account for changes in 
technology, treatment, and medical care. Unfortunately, without 
Congressional input, there is no guarantee that these expedited 
procedures will take place.
  The Medicare Patient Access to Technology Act of 1999 has arisen out 
of growing evidence that without intervention, Medicare beneficiaries 
will be denied access to the most modernized treatments and innovations 
in health care.
  After medical technologies, devices, and drugs are approved by the 
Food and Drug Administration, they still must meet several critical 
HCFA requirements before they are available to Medicare beneficiaries.
  First, before technologies are approved by HCFA for reimbursement, 
they must be covered, that is fulfill the definitions of ``reasonable 
and necessary.'' Second, they must have an identifying procedure code. 
New device technologies receive this ``procedure code,'' a four or five 
digit identification number that allows health care providers to submit 
claims to payers. Finally, the technologies must be reimbursed through 
one of Medicare's payment systems. The  problems arise because each of 
these levels is plagued by inefficiency, coding delays, and lack of 
data usage by HCFA.

  My legislation addresses these concerns in five specific ways.
  First, Medicare payment levels and payment categories will be 
adjusted at least annually to reflect changes in medical practice and 
technology. A recent Institute of Medicine study reported that most 
medical technologies have an average life span of 18 months with many 
modernizations occurring rapidly. These innovations must, therefore, be 
rapidly processed so that they are accessible to beneficiaries. While 
BBA 97 authorized HCFA to adjust payment systems ``periodically'' to 
account for changes in technology, there is little promise that this 
will occur in a systematic, timely and beneficial manner.
  My bill requires HCFA to review and revise payment categories and 
payment levels for all prospective payment systems (PPS) at least 
annually. These prospective payment systems include hospital inpatient 
and outpatient, physicians, ambulatory surgery facility services. It 
also calls for public input on the review process.
  Second, this legislation mandates that valid external sources of 
information be used to update payment categories if Medicare's data are 
limited in scope or, are not yet available. Traditionally, HCFA has 
only used its own data set, known as the Medicare Provider Analysis and 
Review (MEDPAR) data systems, to evaluate a given technology before 
assigning an appropriate code. The average waiting period for the 
assignment of a new code is 18 months or longer.
  Furthermore, HCFA refuses to consider partial year or externally 
generated data in its decision-making processes. My bill directs HCFA 
to use external sources of data on the cost, charges and use of medical 
technologies. This language allows HCFA to utilize high quality data 
from private insurers, manufacturers, suppliers, providers, and other 
sources.
  Third, my legislation will require that national procedure codes are 
updated more frequently to reduce delays in accessing new technologies. 
Currently, new products must have an identification code before they 
are eligible for appropriate reimbursement by Medicare. Assigning this 
code can take 18 months or longer because of the way HCFA has 
structured its calendar year.
  This legislation allows HCFA to accept applications quarterly, on a 
rolling basis, thereby allowing the processing of new technologies 
throughout the year instead of bundling them at one annual submission.
  Furthermore, the Medicare Patient Access to Technology Act will 
eliminate the HCFA requirement that new products be on the market for 
six months before they are eligible for a new code. This provision will 
ensure that new technologies are brought to Medicare beneficiaries more 
rapidly.
  Fourth, the bill guarantees that local procedure codes for medical 
technologies will continue to be used. HCFA has proposed to eliminate 
Common Procedure Coding System (HCPCS) Level III Local Codes beginning 
in 2000 and replace it with the Level II National Codes. This is 
potentially detrimental to new technologies that are often introduced 
into local, smaller health care systems before they are expanded into 
nationwide markets. Without the Level III Local Codes, new technologies 
must be placed into a ``miscellaneous'' code that is often rejected by 
payers thereby denying access of the technology to beneficiaries. The 
maintenance of the current system will ensure that technologies will be 
encoded at the earliest possible date and processed before moving to 
the national level.
  Finally, the legislation authorizes HCFA to create an Advisory 
Committee on Medicare Coding and Payment. As a result, when HCFA has to 
make coding and payment decisions, it will be prompt, permit public 
participation, and will guarantee Medicare beneficiaries access to the 
highest quality products and services. The panel would ensure that safe 
medical technologies are approved, covered, coded and paid by Medicare 
as expeditiously as possible.
  In addition to the above authorizations, the Medicare Patient Access 
to Technology Act proposes several refinements to the Administration's 
proposed outpatient prospective payment system (PPS). The legislation 
affects three changes to HCFA's implementation of the Balanced Budget 
Act (BBA) of 1997.
  The first change mandates HCFA to restructure the proposed ambulatory 
payment classification (APC) system to create groups of procedures that 
are more similar in cost and most closely related clinically. The 
current HCFA proposal would create unusual financial incentives that 
would clearly discourage the use of the most appropriate, cutting-edge 
technology. Furthermore by grouping very disparate technologies, 
hospitals will face serious underpayments for certain procedures. I 
believe that illogical categorization creates disincentives to use 
newer, but more expensive products and procedures that provide far 
superior patient care.
  The second change mandates that HCFA retain the current cost-based 
system for another four years to compile the cost studies and use data 
and conduct the analysis necessary to classify them in the appropriate 
APC. The development of these data sets are mandatory and without 
proper clarification. Therefore, these products could receive 
substantial underpayment, and, as a result, patient access to newer 
procedures and products could be limited.
  Third, the implantable medical technologies should be reimbursed 
under the new APCs along with other similar medical technologies. They 
should not be reimbursed through the durable medical technology fee 
schedule. By placing the implantables within the DME propective payment 
system, the fee schedule will lock implantables into defined categories 
that will limit their use and inhibit their access to seniors. By 
placing them into the proposed APCs with the other medical devices, 
they will be treated as other new, innovative medical technologies.
  Again, I am pleased to be joined by my Senate colleagues, Senators 
Nickles, Breaux, Grassley, Murkowski, and Bayh, in introducing this 
important piece of legislation. This bill supports both our Medicare 
beneficiaries and our technology, pharmaceutical, and biotechnical 
industries by continuing to promote life-enhancing innovations. I 
firmly believe that these significant improvements to our Medicare 
coding and payment systems will increase the access to modern medical 
innovation to Americans who need them most, our senior citizens.

[[Page S11365]]

  Mr. President, I urge my colleagues to join us in support of this 
important legislation.
                                 ______