[Congressional Record Volume 146, Number 102 (Wednesday, September 6, 2000)]
[Senate]
[Pages S8091-S8099]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
A STRONG MEDICARE FOR OUR SENIORS' FUTURE
Mr. ABRAHAM. Mr. President, Medicare, that's what seniors and health
care providers in Michigan talked
[[Page S8092]]
about with me over the August recess--Medicare. Whether it was
prescription drug coverage for Medicare beneficiaries, Medicare
reimbursement restoration so that health care providers can continue to
provide quality health care for beneficiaries, or reining in the
excesses in this Administration's crusade to ferret out Medicare fraud
and abuse, even where it does not exist, I have heard the message of my
constituents, and that is that Medicare needs to be modernized,
reformed, and refocused on providing the best health care possible for
seniors and the disabled.
Nowhere has the national debate on Medicare focused more clearly than
on prescription drug costs. The increased reliance on prescription
drugs in health care treatments in recent years means seniors are
paying a much higher portion of their income on drugs. As new drugs
come on the market that allow doctors to treat illnesses without
surgery, or even allow them to treat illnesses for the first time, the
result is that health care has shifted from inpatient hospital services
for surgical treatment to outpatient care that utilizes more, better,
and more specific drugs. The result is that while per unit costs of
drugs are expected to increase by an average of 3.2 percent over the
next five years, overall drug expenditures are expected to rise by
almost 14.5 percent per year as the number of prescriptions per senior
shoots up by more than 20 percent.
But Medicare, developed in the late 1960's, and little changed since
then, is still geared primarily towards the antiquated focus on
intensive, inpatient care, and continues to miss the fundamental shift
towards modern care techniques, including prescription drugs.
Comprehensive Medicare reform, such as that outlined in the
recommendations of the Bipartisan National Commission on the Future of
Medicare that embodies choice, competition, and modernization, would
allow Medicare to continue its guarantee of health coverage, while
providing the type of health coverage that a modern senior needs.
Unfortunately, apparently due to the election cycle games of this
Administration, the necessary super-majority could not be mustered to
report these proposals to Congress. So, America's seniors continue to
be denied without a modern Medicare system, including prescription drug
coverage.
But these political realities do not lessen the immediacy of the
problem, nor the need for this Congress to move now on providing a
prescription drug benefit. I believe we must move on passing a
prescription drug coverage plan for Medicare seniors, and pass it now.
I hear the cry of my colleagues who say this will take the wind out of
the sails for needed overall Medicare reform, but that assumes
comprehensive reform is possible during this session of Congress. Given
the politically charged nature of this election, and the fact that our
colleagues on the other side of the aisle seem to find new excuses
every week for why they can't vote for even the most non-controversial
of the appropriations bills, I doubt that will happen. In the short
term, Medicare will remain solvent and will be able to provide adequate
medical care for seniors. However, Michigan seniors need prescription
drug coverage as soon as possible, and I intend to see that happen.
Twice this summer, once on my own, and once with a bipartisan group
of 12 other Senators, I have called upon the Senate Leadership to bring
to the Senate floor a meaningful prescription drug plan that will not
only cover these increasingly expensive drugs, but also ensure that
such a plan does not impose additional costs on our seniors, additional
costs that would wipe out any savings the coverage would provide. It
makes little sense to me to establish a prescription drug plan that
pays for 50 percent, or even 100 percent, of a senior's drug expenses,
which average about $550 per year, but then saddle them with $600 in
new premiums, and have them end up with greater out-of-pocket expenses
than if they never had the coverage in the first place. That's not what
I hear Michigan seniors say they want in a prescription drug plan. No,
what I hear them say is that they want a prescription drug plan that
will actually reduce their out-of-pocket expenses, allow them the most
freedom and choice in determining their own coverage, and protect them
from unexpectedly high drug expenses, expenses that can make their
daily choice one between food and drugs.
That's why I am so excited about the prescription drug plan on which
I have been working with Senators Hagel and McCain as well as the other
cosponsors, the Medicare Rx Drug Discount and Security Act of 2000, S.
2836. Of all the plans we have seen presented before this and the other
Chamber, I believe this bill most directly addresses the major issues
of prescription drug coverage. First, unlike any other bill currently
before Congress, it provides broad and deep discounts for prescription
drugs, on average 30-39 percent discounts, through multiple, competing
drug discount buying plans. Much has been made over the last few years
about the relative price difference American seniors pay for their
prescription drugs as compared to those paid by their Canadian
counterparts, where prices are fixed by the Government. But those
comparisons are of the retail price. When the prices paid by Canadian
seniors are compared to the prices paid by American seniors that are in
group buying plans, the American senior pays less.
And these plans are not uncommon. In fact, 71 percent of all
prescription drugs paid for by third parties have been administered by
these group buying plans, such as with the Michigan National Guard's
drug insurance coverage plan. Furthermore, many group buying plans are
offered outside of insurance programs, such as those innovative
programs being offered by Macomb and Wayne Counties in Michigan, where
price savings of as much as 70 percent on drugs are obtained. But as
I've pointed out before, Medicare beneficiaries can't take advantage of
these savings because the Medicare system still employs the antiquated
priorities and structures of the days in which it was born.
For the average American senior with drug expenses of about $670 per
year, in 2002, our plan would provide an immediate savings of $235 per
year. And, depending upon the drugs they have prescribed, savings could
be as high as 70-85 percent for the more common drugs where usage
is higher and competing brands more plentiful. Furthermore, there would
be even greater market pressure for lower prices under our plan because
multiple, competing drug discount plans would be available from which
seniors could choose. If the particular drugs a senior uses were
cheaper under another plan, that senior could shift over to that plan,
and enjoy those better discounts. By allowing the market to drive down
prices we can provide robust market price discounts that no other plan
before Congress can beat, and which are substantially better than those
offered under almost every Democrat plan which I've seen. In fact,
because almost every plan that has been offered by Democrats in both
the Senate and the House allows for only a single entity to control the
price discounting for Medicare seniors, there will be little
competitive pressure to pass along savings to Senior consumers, and
little incentive to even try to get prices down. The Congressional
Budget Office recognized this during their analysis of the President's
prescription drug proposal, and determined that drug discounts would
only average 12.5 percent, or about a third of those that would be seen
under the Hagel-Abraham plan.
But reducing the price of drugs is only half of the prescription drug
equation. The other half is ensuring that Medicare provides the needed
protections for Seniors against expensive drug treatments that may
force them to decide between putting bread on the table or taking a
life-saving drug. And the Hagel-Abraham bill does just that with the
best catastrophic drug coverage of any bill before Congress. By tiering
the coverage to income, we assure all seniors they will not be
financially devastated by drug expenses for some of the new treatments
that can approach $500 per month.
Here is how the prescription drug costs caps break down under the
Hagel-Abraham plan. Seniors earning less than 200 percent of poverty,
$16,700 for a single and $22,500 for a couple, would pay no more than
$1,200 annually. All drug expenses after that would be covered by the
Federal Government. For those seniors that earn more than that, but
below 400 percent of poverty, $33,400 for singles and $45,000 for
couples, costs
[[Page S8093]]
would be limited to $2,500 annually. And Seniors above 400 percent of
the poverty level, up to $100,000 for singles and $200,000 for couples,
would pay no more than $5,000 annually. Although some of my colleagues
may believe that prescription drug insurance should be available to all
Medicare beneficiaries, and that the government should subsidize the
insurance of even the wealthiest Americans, I don't think it makes
sense to subsidize the drug expenditures for those single seniors
making more than $100,000, and those couples making more than $200,000,
especially considering they have much easier access to private
insurance coverage.
What makes this proposal particularly attractive, in my opinion, is
that it does not require seniors to pay hundreds of dollars in new
Medicare premiums, premiums that could be greater than their actual
drug expenses. In fact, the Congressional Budget Office has determined
that when the President's prescription drug proposal is fully
implemented, seniors will have to pay more almost $600 per year in new
Medicare premiums, on top of the $88 per month they will have to pay
for their existing Part B Medicare coverage. I can't see how that can
be a good deal for America's seniors. CBO also recently scored the drug
proposal offered by Senator Robb as an amendment to the Senate's Labor-
HHS Appropriations Bill. That proposal would, according to CBO,
increase Medicare's financing gap between revenues and outlays by 25
percent, while imposing new premiums of $80 per month, or $960 per
year! Forcing America's seniors to pay almost $1,000 per year, just to
have the privilege of participating in this big-government drug
program, is wrong, flat-out wrong. And it will most likely wipe out any
savings they would gain from the coverage in the first place. I believe
by the time these plans were fully implemented, Michigan seniors would
be wishing for the ``good ol' days'' where the government wasn't
providing them such ``great'' coverage that forced them to spend more
than they did before.
I am not merely railing against these plans because they represent a
big-government view of legislating. No, it's that I am deeply concerned
with the record of the Health Care Financing Administration and its
existing prescription drug programs. The fact of the matter is that
HCFA's centralized, top-down, bureaucratic method of providing it's
current inpatient drug benefit has led to drug rationing, cutbacks in
coverage, and price fixing. Just recently this Administration announced
that it intends to cut back coverage of cancer-fighting drugs
administered in doctors' offices and set the price for those drugs by
Executive fiat, even while it says that it's proposed additional drug
coverage will not result in these same things. There is no escaping the
fact that when the government controls all aspects of prescription drug
insurance the quality of care and access are placed in jeopardy. It has
been happening in Canada and we cannot allow that to happen to whatever
new prescription drug coverage we provide.
But we are taking action to stop the Administration's attempts to cut
back cancer drug coverage for sick seniors. I am cosponsoring with
Senator Ashcroft the Cancer Care Preservation Act, which will guarantee
that HCFA cannot implement any reductions in Medicare reimbursements
for outpatient cancer treatment unless those changes are developed in
conjunction with the Medicare Payment Advisory Commission and
representatives of the cancer care community, provides for appropriate
payment rates for outpatient cancer therapy services, and is
specifically authorized by an act of Congress. Furthermore, I am
sending a letter to the President of the United States today, calling
upon him to rescind HCFA's plan until such time as such changes can be
fully examined by the cancer care community and Congress. To think that
the Medicare system could stop covering the most effective cancer
treatments simply by it's own edict should be a clear warning to all of
my colleagues on the dangers in having a single agency control the
access to our senior's prescription drugs.
And that leads me to the second problem I've been hearing about in
Michigan the issue of how HCFA and this Administration manage Medicare,
especially with regard to reimbursement rates. When I first came to the
Senate, Medicare was going broke quickly, and was bound for bankruptcy
by 2001. The Balanced Budget Act of 1997 implemented necessary changes
to contain the growth in Medicare spending to extend the system's
solvency until 2015, giving us time to implement necessary structural
and market-based reforms in Medicare, reforms that can make the program
viable for generations to come. But those modest reductions in the rate
of growth for Medicare have become full-blown cuts in the face of this
Administration's refusal to spend the money Congress has authorized
them to spend.
In fact, this Administration has short-changed Medicare by $37
billion in the last two years. The Congressional Budget Office's July
2000 Budget Projection update indicates that Medicare spending this
year will be $14 billion below what Congress budgeted, following last
year's spending by the Administration of only $209 billion for Medicare
versus the $232 billion Congress provided. The fact of the matter, is
that most reimbursement rates are set by the Administration and HCFA,
and this Administration has repeatedly refused to spend the money on
Medicare that Congress has given them. In fact, while the original
Balanced Budget Act of 1997 was expected to reduce Medicare growth by
$103 billion between 1998 and 2002, this Administration's relentless
ratcheting down of reimbursements over and above that authorized by
Congress has pushed those cuts to almost $250 billion. And between 2001
and 2005, the cuts are expected to be even more dramatic, climbing from
$163 billion to $457 billion, 280 percent greater than Congress
originally intended.
The consequences for Michigan's health care industry are devastating.
According to the March 2000 Michigan Health and Hospital Association
report, ``The Declining State of Michigan Hospitals'' HCFA's
implementation of BBA 97 has cost Michigan hospitals an average of $8.5
million each. As a result, 68 percent of the hospitals have been forced
to eliminate at least one service, ranging from urgent care and rural
health clinics, to rehabilitation and pain management centers, to
screening and preventative health services. Forty-five percent of all
the hospitals have eliminated at least two of the services, and more
than half of those who haven't yet eliminated services yet are
considering it for 2000. Previous reports have put the statewide total
lost hospital revenue at $2.5 billion, or just over $13.5 million per
hospital.
But hospitals are not the only health care provider hit by the
effects of BBA 97 and the voracious appetite of HCFA bureaucrats. Home
Heath Care agencies have been particularly hard hit by HCFA policies
seemingly intent on driving them all out of business. Home health care
spending was expected to grow by $2 billion even after BBA 97 cost
containment measures, but have dropped by $9 billion, a 54 percent drop
in just two years. In fact, the number of home health care claims have
dropped by 50 percent in just two years, and the average payment per
patient lowered by 38.5 percent, far lower than originally projected
with BBA 97. CBO stated this unexpected drop in reimbursements as the
primary reason that total Medicare spending dropped last year. Over the
four years covered by BBA 97, CBO now expects home health care spending
to be reduced by $69 billion, over four times the original $16 billion
that they originally estimated. Like hospitals, home health care has
been decimated. Over 2,500 home health agencies have closed or stopped
serving Medicare patients. Moreover, HCFA estimates that nearly 900,000
fewer home health patients received services in 1999 than in 1997.
Finally, I think we need to look at the effects of this
Administration's policies on reimbursements to skilled nursing
facilities. Under BBA 97, the rate of growth for skilled nursing
facility reimbursements was to be slowed by $19.8 billion between 1998
and 2004. However, since that original projection, reimbursements are
now expected to fall by an additional $15.8 billion. This even takes
into account the $2 billion in reimbursement restorations provided by
the Balanced Budget Refinement Act of 1999. For Michigan, the numbers
are equally disconcerting.
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Michigan has lost $643 million in nursing facility reimbursements,
over and above those projected with BBA 97, over 75 percent more than
originally projected. Is it any wonder then, that 25 percent of all
skilled nursing facilities serving Medicare patients are operating in
bankruptcy and that why the number one problem for hospital discharge
coordinators is that they can't find nursing facilities for their
patients needing them?
We have provided some important reimbursement relief in the Balanced
Budget Refinement Act of 1999. But it was only a first step and by no
means a complete response to the Administration's policies. While
Medicare reimbursements over the next five years are projected to be
cut by $295 billion more than originally projected, BBRA 99 only
restored about $16 billion of that, or less than 5 percent of the
additional cuts. Containing the growth of Medicare was necessary to
ensure Medicare did not go bankrupt, but this continuous, unsustainable
ratcheting down of reimbursements is simply wrong, and we must reverse
it now. That is why this body must bring to the floor real,
substantive, Medicare reimbursement restoration legislation. And we
must do it very soon. We cannot wait until next Congress, or even until
next month. We must do it now. Ensuring Medicare's fiscal solvency on
the backs of Medicare providers is not only wrong, but
counterproductive, and will ultimately lead to the insolvency of
Medicare's health care guarantees as we know it.
I have been working very hard to provide specific reimbursement
relief for Michigan's health care providers. First, Senator Hutchison
of Texas and I have been fighting for two years now to improve the
inpatient reimbursements for hospitals. Our American Hospital
Preservation Acts of 1999 and 2000 would do just that. This year's
version will restore the entirety of the Market Basket Indicator
inflation adjustment for inpatient hospital reimbursement rates,
returning over $6.9 billion to hospitals over the next five years, and
$13.5 billion over the next 10. That will in turn mean more than $536
million in increased reimbursements for Michigan hospitals over the
next ten years, or more than $3.4 million per hospital.
Likewise, I have joined 53 of my colleagues in cosponsoring S. 2365,
the Home Health Payment Fairness Act to eliminate the automatic 15
percent reduction to home health payments currently scheduled to go
into effect on October 1, 2001. The home health care industry cannot
survive with the current reimbursement reductions, let alone another 15
percent across-the-board cut. Finally, I am working closely with a
number of my colleagues to craft a bill that will provide for adequate
nursing home reimbursements through a refinement of the inflation
adjustment factors. We believe appropriate legislation will be
available this week or next, and if any of my colleagues are interested
in joining this effort, I encourage them to contact me immediately.
The third concern I hear from Michiganians about Medicare, is that
even with the steps we have taken to improve its financial standing and
the quality of care, it is still headed towards bankruptcy in the very
near future. Seniors in Michigan are scared, scared that they will lose
their Medicare benefits because we cannot modernize Medicare so that it
will stay solvent for generations to come. But it looks like things are
getting better with Medicare and that at least in the short term, we
have the fiscal breathing room to make the necessary changes to avoid a
train wreck down the way.
This summer the Board of Trustees of the Federal Hospital Insurance
Trust Fund issued a correction to their 2000 Annual Report. In it, the
Trustees reported that the financial projections were more favorable
than those made in 1999, that the Trust Fund income exceeded
expenditures for the second year in a row, and that the Fund now met
the Trustees' test of short-range financial adequacy. In fact, income
is now projected to continue to exceed expenditures for the next 17
years, a substantial increase over previous estimates.
Now 2017 is still too soon for us to rest in our efforts to ensure
the permanent solvency of Medicare through market-based modernization
and reform, as well as provide seniors' access to the full spectrum of
health care options. First, we need to shift Medicare from a centrally-
controlled government system to a market-based system, one that
maximizes choice and can best respond to changing medical care needs,
such as recommended by the National Bipartisan Commission on the Future
of Medicare.
Second, to ensure that we don't raid the Medicare Trust Funds to pay
for non-Medicare spending, as repeatedly proposed by this
Administration, we need to wall off the Medicare Trust Fund surpluses
so that they can only be used for Medicare. I have been proud to vote
for a Medicare lockbox proposal. But recent analysis by conservative
groups such as the Heritage Foundation, and liberal groups such as the
Center on Budget and Policy Priorities have raised serious questions
about the efficacy of each of these proposals, and so I will be working
with my colleagues on both sides of the aisle, especially my fellow
Budget Committee Members, to draft a Medicare lockbox that not only
protects the Medicare surpluses, but also enhances our ability to
provide for the long-term solvency of the system. Even after providing
for a new prescription drug benefit, and after providing for healthier
reimbursements for health care providers, we will still have about $110
billion in Medicare surpluses available to fund this reform. Given that
the Bipartisan Medicare Commission's reform proposal would actually end
up costing less than the current Medicare system through competition
and choice, I believe this is more than adequate to fix our problems
with Medicare. Regardless, the Medicare lockbox will ensure those
surpluses are still there when the need comes for any funds to finance
reform.
Third, I believe we need to allow Americans to prepare for their
retirement health care needs outside of Medicare through Medical
Savings Accounts, or MSAs, long-term care insurance, and existing
health care benefit flexibility. Today's able-bodied workers will be
tomorrow's seniors, and to the extent that we can set in motion now
provisions that will allow them more choices, more options, and more
access to quality health care, the healthier our entire retirement
health care system will be, including Medicare. As we all know, MSAs
are a market-based alternative for quality health care. They offer
maximum flexibility for the self-employed, employees, and employers
while reducing the out-of-pocket cost of insurance. MSAs are an
alternative health insurance plan with real cost-control benefits for
the millions of Americans who have been forced into managed care and
feel they have lost control of their health care decisions. By
establishing these MSAs now, tomorrow's seniors will have sizable
balances available in their retirement years to supplement whatever
coverage is available under Medicare. To that end, I believe we should
make MSAs permanent and affordable by removing eligibility
restrictions, including allowing Federal employees to have MSAs,
lowering the minimum deductible, permitting both employer and employee
MSA contributions, and allowing MSAs in cafeteria plans. Furthermore, I
believe we should also waive the 15 percent penalty tax on non-medical
distributions if the remaining balance at least equals the plan
deductible.
As for long-term care insurance, I support legislation phasing-in 100
percent deductibility of long-term care insurance premiums, when they
are not substantially subsidized by an employer. Under my plan,
individuals age 60 and older would not be subject to such a phase-in
period, and would qualify for 100 percent deductibility immediately. I
believe we should also allow long-term care insurance to be offered as
a cafeteria plan benefit. By providing for more accessible long-term
care options, retirees can build insurance against the catastrophic
expenses of long-term home and nursing facility care that is becoming
increasingly difficult to obtain under Medicare.
Finally, we should allow for greater health insurance plan
flexibility, especially with regards to the multipurpose Flexible
Spending Accounts. Flexible Spending Accounts and cafeteria plans have
become a popular means of providing health benefits to employees, but
under current law, unused benefits are forfeited. This ``use it or lose
it''
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rule has limited the appeal of these plans as well as forfeiting
substantial amounts of money that could be available for retirement
health care needs. I support legislation which will allow transferring
up to $500 in unused Flexible Spending Account balances from one year
to the next, or to roll-over that amount into an IRA, 401(k) retirement
plan, or a Medical Savings Account.
All of these proposals will help retirees better plan for and provide
for their health care needs. But regardless of these supplemental
programs, Medicare will still be at the base of any retirees health
care program. That's why it's even more heartening to see in the
corrected Medicare Trustees' report that some of the more drastic
measures we once thought would be required are no longer necessary to
keep Medicare sound. For example, in 1997, when Medicare was on the
verge of bankruptcy by 2001, many of us, on a bipartisan basis, voted
in favor of a limited move to raise the retirement age for Medicare
eligibility from 65 to 67 years of age starting in 2003 and phased-in
over the following twenty-four years. We did that on a near emergency
basis, because the Medicare system was threatened. But I noted at the
time, if the situation improved, such a change would not be necessary.
In my opinion, that is now the case, and that kind of approach no
longer needs to be considered in light of the improved financial
condition of Medicare and the emergence of significant Medicare trust
fund surpluses.
In fact, at the time I cast my vote on this question, I entered into
the Record on July 14, 1997, a number of prerequisites which I
indicated would have to be met in order for me to support the actual
implementation of the proposal. In that none of these prerequisites--
the development of a viable system for low- and middle-income seniors
to obtain and maintain affordable health care until eligible for
Medicare, as well as concurrence by the National Bipartisan Medicare
Commission on the Future of Medicare on raising the eligibility age--
have been addressed in the two to three year time-frame that I set
forth in my statement, I have withdrawn my support for raising the
eligibility age. I no longer believe this change is necessary in light
of the improved financial status of Medicare, or prudent in light of
the failure of its sponsors to adequately address the concerns I
raised.
Finally, the fourth Medicare issue on which I have been inundated
with complaints is how hard it is to navigate the regulatory complexity
of the Medicare system. I have heard from doctors and hospital
administrators, home health care agencies and skilled nursing
facilities, about how even a simple mistake, or even a difference of
opinion, can embroil them in legal controversies that take years to
resolve, and many times more in legal bills than the amount of the
originally contested bill. HCFA has now produced over 111,000 pages of
Medicare regulations, three times the size of the incredibly complex
Internal Revenue Code. These regulations make it nearly impossible to
operate efficiently, and make simple administrative errors appear to be
criminal fraud. In fact, on August 10th, 1998, Dr. Robert Walker,
president emeritus of the Mayo Foundation, told the National Bipartisan
Commission on the Future of Medicare, ``The public has been led to
believe that the, Medicare, program is riddled with fraud, when in
reality, complexity is the root of the problem. This has contributed to
the continuing erosion in public confidence in our health care system.
We must all have zero tolerance for real fraud, but differences in
interpretation and honest mistakes are not fraud.''
Recently, the Association of American Physicians and Surgeons
conducted a survey of its members as to the impact of HCFA regulations
on their ability to treat patients. They found that it costs on average
27 percent more to process a Medicare claim as it does a private health
insurer claim, and that doctors and their staffs spend more than a
fifth of their time on Medicare compliance issues. Furthermore, more
than half of all doctors say they will retire from active patient care
at a younger age because of ``increased hassles with Medicare.'' This
is bad news for Medicare seniors, as further pointed out by the survey.
Almost a quarter of all doctors are no longer accepting new Medicare
patients, and of those that do, 34 percent are restricting services to
those patients, such as difficult surgical procedures or comprehensive
medical work-ups. Last, these are not changes simply to stop previously
fraudulent activity. Thirty-eight percent of all doctors surveyed
stated they submitted Medicare claims that they knew were for less than
for which they were entitled, or ``downcoding'' in the Medicare
regulatory parlance, but did not want to subject themselves to the
potential of erroneous HCFA reviews and claim denials. Similar
``downcoding'' results have been found with hospitals who deny patients
the most appropriate regimen of care in complex cases because they do
not believe they will be fully reimbursed by Medicare if they submit
such a complex care claim.
That is why on July 27, I introduced S. 2999, the Health Care
Providers Bill of Rights, a bill aimed at addressing the numerous
regulatory and law enforcement abuses in the Medicare system that have
brought to my attention by Michigan health care providers. This bill
addresses many of the specific regulatory ``hassles'' experienced by
doctors and providers everyday as they try to provide the best possible
care for our Seniors.
The bill is divided into six titles: Title I--Reform of HCFA
Regulatory Process; Title II--Reform of Appeals Process; Title III--
Reform of Overpayment Procedure; Title IV--Reform of Voluntary
Disclosure Procedure; Title V--Criminal Law Enforcement Reforms; and
Title VI--Provider Compliance Education.
Provisions that should be of particular interest to my colleagues are
those that rescind HCFA's ability to withhold future reimbursements in
order to offset alleged prior underpayments, a strict 180 day time line
for completion of the Medicare administrative appeals cases, placing
program participation terminations and suspensions in abeyance while
appeals are pending, prohibiting the use of sample audit results to
reduce future reimbursement rates, stopping overpayment collections
while appeals are pending, and establishing voluntary disclosure
procedures that also bring the Department of Justice and U.S. Attorneys
into the process, as well as providing safe harbor from prosecution for
those that enter into and abide by the voluntary disclosure
requirements.
Some further provisions that were specifically recommended by
providers include requiring HCFA, fiscal intermediaries, and carriers
to all spend a portion of their Medicare funds on provider education,
requiring them to provide legally binding advisory opinions on Medicare
coverage, billing, documentation, coding, and cost reporting
requirements, as well as extending the current anti-kickback, civil
monetary penalty, and physician self-referral advisory opinion
requirements that are set to expire August 21st of this year.
A number of organizations have expressed their strong support for
this legislation, including the Michigan Health & Hospital Association,
the Federation of American Hospitals, the National Association for Home
Care, the American Federation of Home Care Providers, the Healthcare
Leadership Council, and the American Health Care Association. I ask
unanimous consent these letters of support be printed in the Record.
There being no objection, the letters were ordered to be printed in
the Record, as follows:
Michigan Health &
Hospital Association,
Lansing, MI, August 9, 2000.
Hon. Spencer Abraham,
U.S. Senate, Dirksen Senate Building, Washington, DC.
Dear Senator Abraham: The Michigan Health and Hospital
Association (MHA) appreciates the opportunity to comment on
the Health Care Provider Bill of Rights and Access Assurance
Act. The legislation includes many provisions aimed at
ensuring that health care providers are treated in a fair,
equitable and civil manner.
Michigan's hospitals and health systems must contend with
an array of complex Medicare laws and regulations. Too often,
Medicare billing errors, due to confusing and conflicting
regulations and instructions, are presumed to be purposeful
and intentional acts. Title I of the bill positively
addresses this regulatory maze, mandating that the Health
Care Financing Administration follow clear and specific
procedures when issuing regulations.
Another provision that will be particularly beneficial is
the inclusion of criminal law enforcement reform.
Establishing specific
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search warrant rules as well as revising current law
enforcement powers of the Health and Human Services Office of
Inspector General will greatly assist in minimizing any
disruption of patient care or threats to the confidentiality
of patient records.
We commend you for addressing these areas of concern. The
MHA also would like to express its gratitude for your
leadership on hospital issues as we work to maintain the
highest quality of care for Medicare beneficiaries.
Sincerely,
Brian Peters,
Vice President, Advocacy.
____
Federation of American Hospitals,
Washington, DC, July 27, 2000.
Hon. Spencer Abraham,
Dirksen Senate Office Building, Washington, DC.
Dear Senator Abraham: The Federation of American Hospitals
commends you for your work to clarify and improve the
regulatory burdens and administration of the Medicare
program. The regulatory burden health care providers face is
massive, growing every day, and diverts us from our primary
mission of delivering high quality health care to the
patients in our communities. Hospitals and other health care
providers take their responsibility to comply with Medicare
laws and regulations very seriously and have devoted
significant amounts of energy and resources to these
obligations. While HHS has been diligent in its efforts to
implement an unprecedented number of regulatory changes in
the program, more work is needed to address problem areas in
the current administration of the Medicare Program and to
develop a more active partnership with health care providers
to promote the integrity of the Program.
The ``Health Care Provider Bill of Rights and Access
Assurance Act'' proposes some important changes to the status
quo to address some key problem areas. One of the most
important checks and balances on the validity of the
regulations HCFA promulgates is the ability of health care
providers to challenge those regulations in a court of law
when they believe that the regulations are excessive,
unconstitutional, beyond the scope of statutory authority or
have been promulgated in violation of the Administrative
Procedures Act. This legislation solidifies timely judicial
review of these challenges. Another important provision in
the legislation promotes greater health care provider
participation in program integrity efforts by improving the
voluntary disclosure and overpayment repayment processes.
The bill also contributes to health care provider education
and compliance efforts by providing for the reauthorization
of the existing advisory opinion provisions subject to expire
in August and setting some new advisory opinion requirements.
The existing advisory opinion statutes provide guidance on
the application of the antikickback and physician self-
referral laws. The bill also adds a new requirement that
HCFA, acting through its contractors, provide written answers
to health care providers on nuts and bolts billing, coding
and cost report questions. In a program this complex, errors
are likely and providers need greater assistance to navigate
the myriad of law, regulation and policy. Hospitals want to
be active partners in the effort to promote program integrity
and hope to work closely with HCFA and its program integrity
partners on education and prevention efforts.
We appreciate your interest in these matters and look
forward to working with you on this important legislation.
Sincerely,
Thomas A. Scully,
President and CEO.
____
National Association
for Home Care,
Washington, DC, July 27, 2000.
Hon. Spencer Abraham,
U.S. Senate, Dirksen Senate Office Building, Washington, DC.
Dear Senator Abraham: On behalf of the National Association
for Home Care (NAHC), the nation's largest organization
representing home care providers and the patients they serve,
I want to extend my sincerest appreciation and support for
your legislation, ``The Health Care Provider Bill of Rights
and Access Assurance Act.'' This legislation to reform the
regulatory processes used by the Health Care Financing
Administration (HCFA) to administer the Medicare program is
greatly needed.
Home health agencies are currently instituting an
overwhelming number of administrative changes. Many of these
changes are costly and significantly increase the workloads
of already strained agency staffs, affecting the ability of
agencies to retain staff and continue to provide high-
quality, appropriate care. HCFA frequently ignores public
notice and comment requirements in implementing programmatic
changes, and often underestimates or downplays the impact of
new requirements on struggling agencies. As a result,
providers are subject to onerous and burdensome requirements
without an opportunity for input, and are given insufficient
time to make operational changes in order to comply with
regulations.
This legislation would ensure public input in HCFA's
regulatory process and prevent arbitrary actions and
erroneous decisions by HCFA from having a devastating impact
on home care providers and their patients before corrective
action is taken. Too often today home care agencies are
bankrupted and their patients lose care before faulty
policies are corrected. This bill would provide an
opportunity to correct errors before irreparable harm is
done. It would also prevent sanctions for conduct which
providers did not know was against the rules. Providers have
every intention of following the rules, but they must have
advance notice of what the rules are.
The Medicare home health benefit is at great risk due to
severe financial reductions and onerous and unnecessary
administrative burdens. Direct intervention by the Congress
is necessary to ensure the integrity and future of this
important and popular benefit. We deeply appreciate your
concern for home health patients and those who care for them.
Enactment of the provisions in this bill would make a major
contribution to expanding access to home health care and
strengthening the home care infrastructure. Our hats are off
to you for this groundbreaking legislation.
With best regards,
Sincerely,
Val Halamandaris,
President.
____
Healthcare Leadership
Council,
Washington, DC, July 26, 2000.
Hon. Spencer Abraham,
U.S. Senate, Dirksen Senate Office Building, Washington, DC.
Dear Senator Abraham: On behalf of the Healthcare
Leadership Council (HLC), I would like to express our deep
appreciation for your proposal to help health care providers
comply with Medicare's increasingly burdensome regulatory
maze.
The HLC is a chief executive coalition of over 50 of the
largest health care organizations in the country, including
hospital systems, insurers, pharmaceutical companies, and
medical device companies. The HLC has zero tolerance for true
fraud and abuse. True fraud and abuse in our health care
system undermines quality, threatens patients' trust and
should not be tolerated.
However, the public's confidence in the nation's health
care system has been eroded by headlines of health care fraud
investigations that are most often not the result of true,
intentional fraud--but rather errors or misunderstandings due
to countless, complex regulations. We believe strongly that
Medicare's complexity actually undermines compliance and,
ultimately, the quality of patient care.
The Provider Bill of Rights and Access Assurance Act
contains several provisions that will improve communication
and relations among Medicare's providers, regulators, and
enforcers. Provisions that we particularly support are those
that would expand providers' appeals rights, coordinate
voluntary disclosure procedures among enforcement agencies,
and educate providers regarding the application of certain
regulations through advisory opinions and other means.
The Healthcare Leadership Council commends you for your
leadership on this very important issue and we stand ready to
help you further refine this legislation so that it will
serve to greatly improve the Medicare program for providers
and patients alike.
Sincerely,
Mary R. Grealy,
President.
____
American Federation of
HomeCare Providers, Inc.,
Silver Spring, MD, July 25, 2000.
Sen. Spencer Abraham,
U.S. Senate, Washington, DC.
Dear Senator Abraham: The American Federation of HomeCare
Providers is pleased to endorse your legislation, the
``Medicare Provider Bill of Rights.''
Our members are small business health care providers who
say that they would much rather deal with the Internal
Revenue Service than with the Health Care Financing
Administration (HCFA) and its contractors. Home care
businesses have no rights that the Fiscal Intermediaries,
carriers, and state surveyors appear to feel obligated to
respect. There is no penalty for incorrect contractor
decisions and no viable system to resolve disputes. Even
instances of blatant abuse of providers and beneficiaries go
without remedy because there is nothing to hold HCFA and its
agents accountable when they are wrong and when their
behavior goes beyond the bounds of ethical and legal
behavior. Contractors routinely refuse to consider
documentation, deny that they received records sent by
providers, deny the obvious wording of the law and
regulation, and sometimes even refuse to abide by court
decisions.
Health care providers also believe that speaking out for
the right of patients to receive an appropriate level of care
and standing up for their own rights become grounds to target
them for harassment. They believe that they are held to 100
percent standards of excellence and accuracy, which they are
proud to meet, and those who serve as HCFA's contractors are
held to no standards of excellence and accuracy in their
dealings with the provider community. It is now time to
ensure due process rights so that conscientious health care
companies, who render critical and appropriate services in
their communities and abide by the tenets of the Medicare law
and regulation, are not subject to arbitrary and abusive
behavior that has the potential to put them out of business,
literally on the spot. Favorable decisions by Administrative
Law Judges are of little comfort to a home health agency that
has unjustifiably been shut down, on specious surveyor claims
that it does not meet the Medicare Conditions of
Participation, or
[[Page S8097]]
by massive statistical sampling overpayment assessments,
later overturned on appeal.
Medicare providers must be accorded the same type of
protections that Congress saw fit to enact for the American
pubic in the Taxpayer Bill of Rights. We believe that your
legislation would do just that.
Sincerely yours,
Ann B. Howard,
Vice President for Policy.
____
American Health Care Association,
Washington, DC, July 28, 2000.
Hon. Spencer Abraham,
U.S. Senate, Dirksen Senate Office Building, Washington, DC.
Dear Senator Abraham: On behalf of the American Health Care
Association (AHCA), a federation of state affiliates
representing more than 12,000 non-profit and for-profit
nursing facility, assisted living, residential care,
intermediate care for the mentally retarded, and subacute
care providers I am writing to thank you and express our
support for your legislation, The Health Care Provider Bill
of Rights and Access Assurance Act.
This legislation is extremely important to long term care
providers for a number of reasons. Recently, in, Shalala v.
Illinois Council on Long Term Care, Inc., the U.S. Supreme
Court ruled that virtually all challenges to the legality of
Medicare regulations or policy must be brought through the
same Department of Health and Human Services (``HHS'')
administrative review process used to address individual
provider reimbursement and certification issues before
proceeding to federal court. The Court's decision means that
a provider or beneficiary cannot challenge the legality of
any Medicare regulation or policy without accepting an
adverse agency action and proceeding through a time-consuming
and costly administrative process. It is particularly
problematic for nursing homes because many components of
HHS's survey and enforcement regulations and policies
conflict with federal law and are fundamentally flawed. Your
legislation would give Medicare providers the right to
challenge directly the constitutionality and statutory
authority of HCFA's regulations and policies.
Additionally, the bill will suspend the termination and
sanction process while appeals on deficiencies are pending,
as well as prohibit the public dissemination of deficiency
determinations while an appeal is pending, absent clear and
convincing evidence of criminal activity. In the current
survey system, skilled nursing facilities are cited and then
may be terminated for highly questionable deficiencies which
do not present a risk to resident health and safety.
Additionally, these citations may be posted on a public
website and this plus the risk of closure of a facility can
confuse and scare the residents and their families. Your bill
would prevent facilities from closing while they appeal a
citation. Also, the bill establishes precedence for
administrative appeals so that providers will have an
affirmative defense in appeals where other providers have
gone through similar appeals. This would add must needed
certainly to the complex rules and regulations under the
Medicare program. We appreciate your commitment to this
important provision.
Among many other provisions in the legislation, the bill
will make needed changes to the False Claims Act. It will
require that claims brought under the Act for damages alleged
to have been sustained by the government must be of a
material amount, which will limit False Claims Act claims to
those that have a significant impact on the Medicare program.
Senator Abraham, we commend your efforts and praise your
leadership. As the nation's largest association of long term
care providers, AHCA is available to assist you in any way
that we can to advance this legislation.
Sincerely,
Charles H. Roadman II, M.D.,
President and CEO.
Mr. ABRAHAM. I am continuing to reach out to additional organizations
to garner their support, as well as to my colleagues in the Senate to
join Senators Cochran of Mississippi and Senator Grams of Minnesota as
cosponsors. Furthermore, Members of the other body will soon introduce
companion legislation to S. 2999 in the hope that we can incorporate
these necessary reforms in a Medicare reimbursement restoration bill or
other reform legislation that may pass this Congress. Finally, I am
joining Senator Craig in calling on the Senate Finance Committee to
hold immediate hearings on this legislation, and the broader issue of
HCFA regulatory complexity. With this legislation, I believe we can
break down one of the primary obstacles to assuring access to quality
health care in this country, the seemingly unfettered abuses of
Medicare bureaucrats against doctors and providers alike. I urge my
colleagues to join me on this important measure.
I believe I have laid out a comprehensive and sensible policy for
ensuring the continued viability of Medicare. Medicare has provided
millions of seniors access to quality health care where otherwise they
would go without. But more must be done, and must be done soon: we must
modernize Medicare so that it provides for coverage of prescription
drug expenses; we must improve reimbursements to providers so that
reform and cost containment does not come at the expense of the very
access to health care Medicare is trying to provide; we must implement
comprehensive Medicare reform that improves beneficiaries choices in
their health care decisions, mirrors the health care needs of the
modern senior, and is fiscally sound for generations to come; and we
must rein in the abusive and incredibly complex bureaucratic behemoth
that has crippled health care providers' ability to operate efficiently
in the Medicare system. We can do all of this, but time is running very
short. Our seniors need these changes, and the time to act is now.
I ask unanimous consent a section-by-section analysis of the measure
be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
THE ABRAHAM HEALTH CARE PROVIDERS' BILL OF RIGHTS (S. 2999)
Section-by-Section Summary
Title I--Regulatory Reform
Section 101. Prohibiting the Retroactive Application of
Regulations
Providers have complained that HCFA, its Financial
Intermediaries (FI's; the private firms that administer the
Part A payments), and its carriers (the private firms that
administer the Part B payments), issue retroactive rules and
policies that are not subject to the Administrative
Procedures Act. In fact, they show where HCFA has often
issued these rules and policies rather than regulations
specifically to avoid the requirements of the Administrative
Procedures Act (public hearings, public discussion periods,
publication in the Federal Register, etc.), and that they do
so retroactively. This section will prohibit HCFA from
issuing anything regarding the legal standards governing the
scope of benefits, the payments rates, or eligibility rules
except by regulation, and then only prospectively, so that no
retroactive regulations are issued.
Section 102. Requiring HCFA to Follow Normal Regulation
Issuance Procedures
Providers also complain about how HCFA circumvents the
Administrative Procedures Act regulatory process by issuing
interim final rules, which are implemented without the public
discussion period and hearings, under emergency powers called
the ``Good Cause'' clause, but fails to provide any
justification other than simply that they have good cause. In
order to prevent these tautologies from continuing, this
section prohibits HCFA from issuing interim final regulations
that haven't gone through the normal regulation public
vetting process.
Section 103. GAO Report on HCFA Compliance with Regulatory
Procedure Laws
Given the extensive reports of HCFA abusing its regulatory
issuance authority, this section directs GAO to conduct an
audit of, and report to Congress within 18 months on, HCFA's
compliance with the Administrative Procedures Act and the
Regulatory Flexibility Act.
Section 104. Providing for Summary Judicial Challenges of
HCFA Regulations on Constitutional or Other Broad Grounds
Before the Supreme Court Decision of Shalala v. Illinois
Council this spring, providers had a right to prospective
judicial challenges to HCFA regulations they thought were
either unconstitutional or were beyond HCFA's statutory
authority to issue. After this decision, however, the only
recourse providers have to challenge these regulations is to
wait until they are found in violation, then appeal the HCFA
decision. This section reestablishes a prospective regulatory
and judicial challenge process of those HCFA regulations to
challenge the constitutionality or statutory authority of a
regulation, or to preemptively challenge an interim final
rule issued under the Good Cause clause.
Section 105. Delineating Procedures for National Coverage
Determination Changes
There is a regulatory process that is exempt from even the
currently liberal HCFA regulatory issuance rules, called
National Coverage Determinations. These determine what will,
and will not, be covered by the Medicare program, and can
change rules on what medical procedures that will be covered
rules overnight. This section establishes a National Coverage
Determination review process that requires a 30-day prior
notice of initiating such a process, and allows for adequate
public comment before implementing the new coverage
determination.
Title II--Appeals Process Reform
Section 201. Expanding Providers' Overpayment Appeal Rights
Current appeal regulations only allow providers three
options when HCFA tells them
[[Page S8098]]
they have been overpaid: admit the overpayment and pay it;
submit evidence in mitigation to reduce the amount of alleged
overpayment but waive all appeal rights; or appeal the
decision, but be subjected to a Statistically Valid Random
Sample Audit (SVRS), a process which essentially shuts the
provider down. This section will allow providers to exercise
the second option (submitting evidence in mitigation) without
waiving their appeal rights.
Section 202. Deadlines for Appeal Adjudication
This section requires the Medicare appeals process to be
completed within 180 days, 90 days for the Administrative Law
Judge first level appeal and 90 days for the Departmental
Appeals Board second level appeal. Where the appeals process
does not meet these deadlines, this section provides for the
appeals process to be automatically advanced to the next
stage.
Section 203. Provider Appeals on the Part of Deceased
Beneficiaries
This section allows providers to pursue appeals on behalf
of deceased beneficiaries where no substitute party is
available.
Section 204. Suspending Terminations and Sanctions During
Appeals
Currently, if HCFA makes a determination that a provider is
abiding by HCFA standards, it can terminate that provider's
participation in Medicare, publicly disseminate that
deficiency information, and impose sanctions short of
termination, even if the provider appeals the determination.
This section suspends the termination and sanction process
while appeals on deficiencies are pending, as well as
prohibits the public dissemination of deficiency
determinations while the appeal is pending, absent clear and
convincing evidence of criminal activity.
Section 205. Establishing Precedence for Administrative
Appeals
Ninety-eight percent of all appeals that are adjudicated at
the first level of the appeals process (the Administrative
Law Judge level), are determined in favor of the provider.
This appears to be due in large part because HCFA apparently
tries to squeeze providers into not fighting overpayment
determinations in the hope that some providers simply will
pay rather than fight. This section will give Departmental
Appeals Board decisions national precedence in the Medicare
appeals process so that providers will not have to fight the
same appeal over and over.
Section 206. Safe Harbor for Substantial Compliance With HCFA
Procedures
Providers can try their very best to comply with HCFA
regulations but then be told by HCFA that they have violated
some policy or rule, and be subject to fines and overpayment
determinations. This section gives providers protection from
HCFA action where a claim was submitted by a provider in
reliance on erroneous information or written statements
supplied by a Federal agency.
Section 207. GAO Audit of HCFA's Statistical Sampling
Procedures
HCFA bases much of its compliance determinations on
statistical sample audits, either through random audits as
part of the Medicare Integrity Program, or through
overpayment audits. However, there is substantial evidence
that HCFA's statistical sampling procedures do not follow
generally accepted procedures, and don't interpret the data
in a statistically valid manner. This section direct GAO to
conduct an audit of HCFA's (and its Financial Intermediaries'
and Carriers') statistical sampling and utilization
procedures.
Title III--Overpayment Procedure Reform
Section 301. Prohibit Retroactive Overpayment Determinations
through New Policies
HCFA currently has the authority to change policy
interpretations and implement them so as to make retroactive
overpayments determinations, even though the previous policy
may have allowed the charges. This section bars HCFA from
making overpayment determinations based upon the retroactive
application of a new policy interpretation.
Section 302. Prohibit Reductions of Future Payments Based on
Sample Audits of Past Claims
HCFA currently reduces future payments by whatever error
rate they derive from their statistical sample audits, even
where there is no evidence that the pending or future
payments are similarly in error, they simply assume that they
are so, even if under appeal. Furthermore, the provider has
no way to stop that withholding until the appeal is decided
in their favor. This section bars HCFA from making such
blanket withholdings from future payments, without clear and
convincing evidence of fraud.
Section 303. Prohibit Withholding of Underpayments or Future
Payments for Past Overpayments
In addition to withholding future payments by whatever
error rate a HCFA sample audits produce, HCFA also regularly
withholds underpayments owed the provider, as well as the
full amount of future payments, and applies them to past
overpayments, regardless of whether the provider is appealing
the overpayment determination, or has entered into a
repayment agreement. This can effectively strangle a
provider's entire revenue flow, and has forced many providers
into bankruptcy, even when such overpayments are being
appealed. This section prohibits HCFA from withholding
underpayments or future payments to pay for past
overpayments, unless clear and convincing evidence of fraud
exists.
Section 304. Suspend Overpayment Collections While Appeals
are Pending
Even if a provider decides to be subjected to the lengthy
and expensive appeals process, they are still required to
immediately repay HCFA for alleged overpayments. This section
suspends overpayment recoupment while appeals are pending.
Given that appeals will be expedited under this bill to 180
days, the Medicare system will still have timely access to
any overpayment funds.
Title IV--Voluntary Disclosure Procedure Reform
Section 401. Effective Voluntary Disclosure Procedures
Many times the first person to discover that a provider has
been overpaid or has not been in compliance with Medicare
regulations is the provider himself. However, the Department
of Health and Human Services voluntary disclosure procedures
still allow the Attorney General and U.S. Attorneys to use
the exact same information provided by the provider to the
Department Office of Inspector General under the current
voluntary disclosure process against the provider for
prosecution. This section directs the Secretary of Health and
Human Services (HCFA's parent department) and the Attorney
General to make joint voluntary disclosure procedures which
provide a safe harbor from prosecution for providers who
report the violation so long as these agencies haven't
already approached them about the possible violation or
overpayment, and there isn't previously and independently
obtained clear and convincing evidence of fraud.
Title V--Criminal Law Enforcement Reform
Section 501. Rescind Law Enforcement Powers of HHS OIG
Investigators
Currently, the Department of Health and Human Services'
Office of Inspector General investigators are the enforcement
arm of the Medicare program for HCFA, and are deputized by
the U.S. Marshal Service to execute those duties. This has
turned into their being granted near carte blanche authority
for enforcing Medicare laws and regulations. With that, it is
increasingly evident that OIG investigators may abuse that
power, such as raiding hospitals and physicians offices with
the same tactics that SWAT teams use on crack houses. This
section rescinds OIG's deputation, and bars those
investigators from carrying weapons in the execution of their
duties.
Section 502. Codify More Stringent Search Warrant Rules for
Health Care Facilities
Many health care providers who find themselves on the wrong
side of an HHS OIG investigation are subjected to
unnecessarily intrusive search warrant executions, with
doctors and nurses accosted by gun-wielding investigators,
and patients removed from medical care. This section codifies
search warrant rules that so as to protect the
confidentiality of medical records, the provider-patient
relationship, and the uninterrupted continuation of medical
care. Specifically, it requires the law enforcement agency
requesting the search warrant to take the least intrusive
approach to executing the warrant, consistent with vigorous
and effective law enforcement. It also directs the law
enforcement agency seeking the warrant to work closely with
the Department of Justice and the relevant U.S. Attorney's
office to ensure the warrant is indeed necessary and that the
search minimizes disruption to patient care or threats to the
confidentiality of patient records.
Title VI--Provider Compliance Education
Section 601. Provider Education Funding
This section requires Financial Intermediaries and Carriers
to spend 3 percent of their Medicare funds on provider
billing and compliance education, and HCFA to dedicate 10% of
their Medicare Integrity Program funds to such education, so
as to try to decrease the rate of provider non-compliance, as
well as over- and under-billing.
Section 602. Advisory Opinions for Health Care Providers
This section requires HCFA to provide written answers to
questions about coverage, billing, documentation, coding,
cost reporting and procedures under the Medicare program,
answers which can be used as an affirmative defense against
an overpayment determination or an allegation of violating
Medicare regulations.
Section 603. Extension of Existing Advisory Opinion
Provisions of Law
The Health Insurance Portability and Accountability Act
(HIPAA) included a provision requiring the Secretary to issue
written advisory opinions on certain specified topics under
the anti-kickback statute and civil monetary penalty
provisions. However, that provision sunsets on August 21st,
2000. The Balanced Budget Act of 1997 (BBA 97) provides a
similar provision regarding the legality of referrals under
the physician self-referral laws, which also sunsets August
21st, 2000. This section extends these advisory opinion
provisions permanently.
Supporting Organizations
Michigan Health & Hospital Association.
Federation of American Hospitals.
National Association for Home Care.
American Federation of Home Care Providers.
[[Page S8099]]
Healthcare Leadership Council.
American Health Care Association.
____________________