[Congressional Record Volume 146, Number 108 (Thursday, September 14, 2000)]
[Senate]
[Pages S8592-S8593]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. JOHNSON (for himself and Mr. Hutchinson):
  S. 3055. A bill to amend title XVIII of the Social Security Act to 
revise the payments for certain physician pathology services under the 
medicare program; to the Committee on Finance.


         physician pathology services fair payment act of 2000

  Mr. JOHNSON. Mr. President, I rise on behalf of myself and my 
colleague, Senator Hutchinson, to introduce the ``Physician Pathology 
Services Fair Payment Act of 2000.'' This important legislation allows 
independent laboratories to continue to receive direct payments from 
Medicare for the technical component of pathology services provided to 
hospital inpatients and outpatients. This bill encompasses both the 
inpatient and outpatient technical components in a comprehensive manner 
than will allow Congress to address both of these pressing issues in a 
single legislative vehicle.
  As you know, many hospitals, particularly small and rural hospitals, 
make arrangements with independent laboratories to provide physician 
pathology services for their patients. They do so because these 
hospitals typically lack the patient volume or funds to sustain an in-
house pathology department. Yet, if the hospitals are to continue to 
provide surgery services in the local community, Medicare requires them 
to provide, directly or under arrangements, certain physician pathology 
services. Without these arrangements, patients may have to travel far 
from home to have surgery performed.
  Recently, HCFA delayed implementation of new inpatient and outpatient 
technical component (TC) reimbursement rules until January 1, 2001. 
However, many providers esepectially those in rural or medically 
underserved areas, remain concerned that the new rules will impose 
burdensome costs and administrative requirements on hospitals and 
independent laboratories that have operated in good faith under the 
prior policy. For hospitals and independent laboratories that have 
operated in good faith under the prior policy. For hospitals and 
independent laboratories with existing arrangements, changing the way 
Medicarepays for the TC physician pathology services provided to 
hospitals is likely to strain already scarce resources by creating new 
costs that cannot be easily absorbed. For the first time, independent 
laboratories will have to generate two bills--one for the technical 
components to the hospital and onother to Medicare for the professional 
components. Since each laboratory may serve five, ten or more 
hospitals, these separate billings will be costly and complicated.
  The ``Physician Pathology Services Fair Payment Act of 2000'' is 
essential to the many communities in my home state of South Dakota, and 
across the country, who rely on the continued presence of pathology 
services to retain a high-quality health care delivery system that is 
both responsive and accessible to each and every individual requiring 
these services. Pathologists provide an extremely powerful and valuable 
resource to these communities and the ``Physician Pathology Services 
Fair Payment Act of 2000'' will ensure that these health care 
professionals continue to positively impact the lives of not only South 
Dakotans but the lieves of millions of Americans who utilize these 
services without perhaps even knowing the critical role that they play 
in our health care delivery system.
  Mr. President, I ank unanimous consent that the complete 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. 3055

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Physician Pathology Services 
     Fair Payment Act of 2000''.

     SEC. 2. TREATMENT OF CERTAIN PHYSICIAN PATHOLOGY SERVICES 
                   UNDER MEDICARE.

       (a) In General.--Notwithstanding any other provision of 
     law, when an independent laboratory, under a grandfathered 
     arrangement with a hospital, furnishes the technical

[[Page S8593]]

     component of a physician pathology service with respect to--
       (1) an inpatient fee-for-service medicare beneficiary, such 
     component shall be treated as a service for which payment 
     shall be made to the laboratory under section 1848 of the 
     Social Security Act (42 U.S.C. 1395w-4) and not as an 
     inpatient hospital service for which payment is made to the 
     hospital under section 1886(d) of such Act (42 U.S.C. 
     1395ww(d)); and
       (2) an outpatient fee-for-service medicare beneficiary, 
     such component shall be treated as a service for which 
     payment shall be made to the laboratory under section 1848 of 
     such Act (42 U.S.C. 1395w-4) and not as a hospital outpatient 
     service for which payment is made to the hospital under the 
     prospective payment system under section 1834(t) of such Act 
     (42 U.S.C. 1395l(d)).
       (b) Definitions.--For purposes of this section:
       (1) Grandfathered arrangement.--The term ``grandfathered 
     arrangement'' means an arrangement between an independent 
     laboratory and a hospital--
       (A) that was in effect as of July 22, 1999, even if such 
     arrangement is subsequently renewed; and
       (B) under which the laboratory furnishes the technical 
     component of physician pathology services with respect to 
     patients of the hospital and submits a claim for payment for 
     such component to a medicare carrier (and not to the 
     hospital).
       (2) Inpatient fee-for-service medicare beneficiary.--The 
     term ``inpatient fee-for-service medicare beneficiary'' means 
     an individual who--
       (A) is an inpatient of the hospital involved;
       (B) is entitled to benefits under part A of title XVIII of 
     the Social Security Act (42 U.S.C. 1395c et seq.); and
       (C) is not enrolled in--
       (i) a Medicare+Choice plan under part C of such Act (42 
     U.S.C. 1395w-21 et seq.);
       (ii) a plan offered by an eligible organization under 
     section 1876 of such Act (42 U.S.C. 1395mm); or
       (iii) a medicare managed care demonstration project.
       (3) Outpatient fee-for-service medicare beneficiary.--The 
     term ``outpatient fee-for-service medicare beneficiary'' 
     means an individual who--
       (A) is an outpatient of the hospital involved;
       (B) is enrolled under part B of title XVIII of the Social 
     Security Act (42 U.S.C. 1395j et seq.); and
       (C) is not enrolled in--
       (i) a plan or project described in paragraph (2)(C); or
       (ii) a health care prepayment plan under section 
     1833(a)(1)(A) of such Act (42 U.S.C. 1395l(a)(1)(A)).
       (4) Medicare carrier.--The term ``medicare carrier'' means 
     an organization with a contract under section 1842 of the 
     Social Security Act (42 U.S.C. 1395u).
       (c) Effective Date.--This section shall apply to services 
     furnished on or after July 22, 1999.

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