[Congressional Record Volume 149, Number 95 (Wednesday, June 25, 2003)]
[Senate]
[Pages S8578-S8596]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 1044. Mr. BAYH submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       At the appropriate place, insert the following:

     SEC. __. URBAN HEALTH PROVIDER ADJUSTMENT.

       (a) In General.--Beginning with fiscal year 2004, 
     notwithstanding section 1923(f) of the Social Security Act 
     (42 U.S.C. 1396r-4(f)) and subject to subsection (c), with 
     respect to a State, payment adjustments made under title XIX 
     of the Social Security Act (42 U.S.C. 1396 et seq.) to a 
     hospital described in subsection (b) shall be made without 
     regard to the DSH allotment limitation for the State 
     determined under section 1923(f) of that Act (42 U.S.C. 
     1396r-4(f)).
       (b) Hospital Described.--A hospital is described in this 
     subsection if the hospital--
       (1) is owned or operated by a State (as defined for 
     purposes of title XIX of the Social Security Act), or by an 
     instrumentality or a municipal governmental unit within a 
     State (as so defined) as of January 1, 2003; and
       (2) is located in Marion County, Indiana.
       (c) Limitation.--The payment adjustment described in 
     subsection (a) for fiscal year 2004 and each fiscal year 
     thereafter shall not exceed 175 percent of the costs of 
     furnishing hospital services described in section 
     1923(g)(1)(A) of the Social Security Act (42 U.S.C. 1396r-
     4(g)(1)(A)).
                                 ______
                                 
  SA 1045. Mr. CHAMBLISS submitted an amendment intended to be proposed 
by him to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the end of subtitle B of title IV, add the following:

     SEC. __. DEMONSTRATION PROJECT FOR EXCLUSION OF BRACHYTHERAPY 
                   DEVICES FROM PROSPECTIVE PAYMENT SYSTEM FOR 
                   OUTPATIENT HOSPITAL SERVICES.

       (a) Demonstration Project.--The Secretary shall conduct a 
     demonstration project under part B of title XVIII of the 
     Social Security Act under which brachytherapy devices shall 
     be excluded from the prospective payment system for 
     outpatient hospital services under the medicare program and, 
     notwithstanding section 1833(t) of the Social Security Act 
     (42 U.S.C. 1395l(t)), the amount of payment for a device of 
     brachytherapy furnished under the demonstration project shall 
     be equal to the hospital's charges for each device furnished, 
     adjusted to cost.
       (b) Specification of Groups for Brachytherapy Devices.--The 
     Secretary shall create additional groups of covered OPD 
     services that classify devices of brachytherapy furnished 
     under the demonstration project separately from the other 
     services (or group of services) paid for under section 
     1833(t) of the Social Security Act (42 U.S.C. 1395l(t)) in a 
     manner reflecting the number, isotope, and radioactive 
     intensity of such devices furnished, including separate 
     groups for palladium-103 and iodine-125 devices.
       (c) Duration.--The Secretary shall conduct the 
     demonstration project under this section for the 3-year 
     period beginning on the date that is 90 days after the date 
     of enactment of this Act.
       (d) Report.--Not later than January 1, 2007, the Secretary 
     shall submit to Congress a report on the demonstration 
     project conducted under this section. The report shall 
     include an evaluation of patient outcomes under the 
     demonstration project, as well as an analysis of the cost 
     effectiveness of the demonstration project.
       (e) Waiver Authority.--The Secretary shall waive compliance 
     with the requirements of title XVIII of the Social Security 
     Act to such extent and for such period as the Secretary 
     determines is necessary to conduct the demonstration project 
     under this section.
       (f) Funding.--
       (1) In general.--The Secretary shall provide for the 
     transfer from the Federal Supplementary Insurance Trust Fund 
     established under section 1841 of the Social Security Act (42 
     U.S.C. 1395t) of such funds as are necessary for the costs of 
     carrying out the demonstration project under this section.
       (2) Budget neutrality.--In conducting the demonstration 
     project under this section, the Secretary shall ensure that 
     the aggregate payments made by the Secretary do not exceed 
     the amount which the Secretary would have paid if the 
     demonstration project under this section was not implemented.
                                 ______
                                 
  SA 1046. Mr. CHAMBLISS submitted an amendment intended to be proposed 
by him to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the end of subtile B of title IV, add the following:

     SEC. __. DEMONSTRATION PROJECT FOR COVERAGE OF SURGICAL FIRST 
                   ASSISTING SERVICES OF CERTIFIED REGISTERED 
                   NURSE FIRST ASSISTANTS.

       (a) Demonstration Project.--The Secretary shall conduct a 
     demonstration project under part B of title XVIII of the 
     Social Security Act under which payment is made for surgical 
     first assisting services furnished by a certified registered 
     nurse first assistant to medicare beneficiaries.
       (b) Definitions.--In this section:
       (1) Surgical First Assisting Services.--The term ``surgical 
     first assisting services'' means services consisting of first 
     assisting a physician with surgery and related preoperative, 
     intraoperative, and postoperative care (as determined by the 
     Secretary) furnished by a certified registered nurse first 
     assistant (as defined in paragraph (2)) which the certified 
     registered nurse first assistant is legally authorized to 
     perform by the State in which the services are performed.
       (2) Certified Registered Nurse First Assistant.--The term 
     ``certified registered nurse first assistant'' means an 
     individual who--
       (A) is a registered nurse and is licensed to practice 
     nursing in the State in which the surgical first assisting 
     services are performed;
       (B) has completed a minimum of 2,000 hours of first 
     assisting a physician with surgery and related preoperative, 
     intraoperative, and postoperative care; and
       (C) is certified as a registered nurse first assistant by 
     an organization recognized by the Secretary.

[[Page S8579]]

       (c) Payment Rates.--Payment under the demonstration project 
     for surgical first assisting services furnished by a 
     certified registered nurse first assistant shall be made at 
     the rate of 80 percent of the lesser of the actual charge for 
     the services or 85 percent of the amount determined under the 
     fee schedule established under section 1848(b) of the Social 
     Security Act (42 U.S.C. 1395w-4(b)) for the same services if 
     furnished by a physician.
       (d) Demonstration Project Sites.--The project established 
     under this section shall be conducted in 5 States selected by 
     the Secretary.
       (e) Duration.--The Secretary shall conduct the 
     demonstration project for the 3-year period beginning on the 
     date that is 90 days after the date of the enactment of this 
     Act.
       (f) Report.--Not later than January 1, 2007, the Secretary 
     shall submit to Congress a report on the project. The report 
     shall include an evaluation of patient outcomes under the 
     project, as well as an analysis of the cost effectiveness of 
     the project.
       (g) Funding.--
       (1) In general.--The Secretary shall provide for the 
     transfer from the Federal Supplementary Insurance Trust Fund 
     established under section 1841 of the Social Security Act (42 
     U.S.C. 1395t) of such funds as are necessary for the costs of 
     carrying out the project under this section.
       (2) Budget neutrality.--In conducting the project under 
     this section, the Secretary shall ensure that the aggregate 
     payments made by the Secretary do not exceed the amount which 
     the Secretary would have paid if the project under this 
     section was not implemented.
       (i) Waiver Authority.--The Secretary shall waive compliance 
     with the requirements of title XVIII of the Social Security 
     Act to such extent and for such period as the Secretary 
     determines is necessary to conduct demonstration projects.
                                 ______
                                 
  SA 1047. Mr. LEVIN submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       On page 78, line 15, insert before the period the 
     following: ``and all succeeding years. Once such a 
     determination is made with respect to an area, the 
     Administrator shall ensure that a contract of the type 
     entered into under the preceding sentence remains in effect 
     for such area for each such succeeding year and beneficiaries 
     receiving the standard prescription drug coverage under such 
     a contract may elect to remain enrolled in such coverage 
     under a such contract regardless of whether the access 
     required under subsection (d)(1) is going to be provided in 
     the area in the year''.
                                 ______
                                 
  SA 1048. Mr. LEVIN submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       On page 79, between line 22 and 23, insert the following:
       ``(F) Permanent fallback in certain areas.--
       ``(i) In general.--Notwithstanding paragraph (1), in the 
     case of an applicable area, the Administrator shall enter 
     into a contract under paragraph (1)(B) with respect to the 
     area for each year after the year in which the area meets the 
     definition of an applicable area. Eligible beneficiaries 
     residing in such area may elect to receive standard 
     prescription drug coverage (including access to negotiated 
     prices for such beneficiaries pursuant to section 1860D-6(e)) 
     under such contract in a year regardless of whether the 
     access required under subsection (d)(1) is going to be 
     provided in the area in that year.
       ``(ii) Applicable area.--For purposes of this subparagraph, 
     the term `applicable area' means an area--

       ``(I) that was designated under paragraph (1)(B) for a 
     year;
       ``(II) in which the access required under subsection (d)(1) 
     was met with respect to a year subsequent to the year 
     described in subclause (I); and
       ``(III) that was designated under paragraph (1)(B) for a 
     year subsequent to the year described in subclause (II).

                                 ______
                                 
  SA 1049. Mr. LEVIN submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       Beginning on page 39, strike line 23 through page 40, line 
     2, and insert the following:
       ``(E) Restrictions on removing drugs from formulary.--An 
     eligible entity may not remove a drug from the formulary 
     under the plan--
       ``(i) during the 2-year contract for the plan; and
       ``(ii) unless the entity has provided appropriate notice to 
     beneficiaries, physicians, and pharmacists that the drug will 
     be removed at the beginning of the subsequent 2-year contract 
     for the plan.
                                 ______
                                 
  SA 1050. Mr. LEVIN submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       On page 79, between line 22 and 23, insert the following:
       ``(F) Permanent fallback for certain beneficiaries.--
       ``(i) In general.--Notwithstanding paragraph (1), the 
     Administrator shall enter into a contract under paragraph 
     (1)(B) for each area for each year. Applicable eligible 
     beneficiaries residing in such area may elect to receive 
     standard prescription drug coverage (including access to 
     negotiated prices for such beneficiaries pursuant to section 
     1860D-6(e)) under such contract in a year regardless of 
     whether the access required under subsection (d)(1) is going 
     to be provided in the area in that year. Other eligible 
     beneficiaries residing in such area may elect to receive such 
     coverage under such contract only if the area has been 
     designated under paragraph (1)(B) for the year.
       ``(ii) Applicable eligible beneficiary.--For purposes of 
     this subparagraph, the term `applicable eligible beneficiary' 
     means an individual who--

       ``(I) is enrolled under this part;
       ``(II) was covered under a group health plan; and
       ``(III) involuntarily lost such coverage such that the 
     beneficiary was eligible for a special open enrollment period 
     under section 1860D-2(b)(3).

                                 ______
                                 
  SA 1051. Mr. ENZI (for himself, Mrs. Lincoln, Mr. Pryor, and Ms. 
Murkowski) proposed an amendment to the bill S. 1, to amend title XVIII 
of the Social Security Act to make improvements in the medicare 
program, to provide prescription drug coverage under the medicare 
program, and for other purposes; as follows:
       On page 37, between lines 20 and 21, insert the following:
       ``(C) Convenient access to pharmacies.--In this section, 
     the term `convenient access' means access that is no less 
     favorable to enrollees than the rules for convenient access 
     to pharmacies of the Secretary of Defense established as of 
     June 1, 2003, for purposes of the TriCare retail pharmacy 
     program. Such rules shall include adequate emergency access 
     for enrolled beneficiaries.
       On page 48, between lines 4 and 5, insert the following:
       ``(4) Tying of contracts.--No eligible entity with a 
     contract under this part, or its agent, may require a 
     pharmacy to participate in a medicare prescription drug plan 
     as a condition of participating in nonmedicare programs or 
     networks, or require a pharmacy to participate in a 
     nonmedicare program or network as a condition of 
     participating in a medicare prescription drug plan.
                                 ______
                                 
  SA 1052. Mr. EDWARDS (for himself and Mr. Harkin) proposed an 
amendment to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicar program, and for other 
purposes; as follows:

       At the end, add the following:

       TITLE __--DIRECT-TO-CONSUMER PRESCRIPTION DRUG ADVERTISING

     SEC.__01. DIRECT-TO-CONSUMER ADVERTISING.

       Section 505 of the Federal Food, Drug, and Cosmetic Act (21 
     U.S.C. 355) is amended by inserting at the end the following:
       Regulations.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Health and Human 
     Services shall promulgate amended regulations governing 
     prescription drug advertisements.
       (2) Contents.--In addition to any other requirements, the 
     regulations under paragraph (1) shall require that--
       (A) any advertisement present a fair balance, comparable in 
     depth and detail, between--
       (i) information relating to effectiveness of the drug 
     (including, if available, effectiveness in comparison to 
     other drugs for substantially the same condition or 
     conditions); and
       (ii) information relating to side effects and 
     contraindications;
       (B) any advertisement present a fair balance, comparable in 
     depth, between--
       (i) aural and visual presentations relating to 
     effectiveness of the drug; and
       (ii) aural and visual presentations relating to side 
     effects and contraindications, provided that, nothing in this 
     section shall require explicit images or sounds depicting 
     side effects and contraindications;
       (C) prohibit false or misleading advertising that would 
     encourage a consumer to take the prescription drug for a use 
     other than a use for which the prescription drug is approved 
     under section 505 of the Federal Food, Drug, and Cosmetic Act 
     (21 U.S.C. 355); and

[[Page S8580]]

       (D) require that any prescription drug that is the subject 
     of a direct-to-consumer advertisement include in the package 
     in which the prescription drug is sold to consumers a 
     medication guide explaining the benefits and risks of use of 
     the prescription drug in terms designed to be understandable 
     to the general public.

     SEC. __02. CIVIL PENALTY.

       Section 303 of the Federal Food, Drug, and Cosmetic Act (21 
     U.S.C. 333) is amended by adding at the end the following:
       ``(h) Direct-to-Consumer Prescription Drug Advertising.--
       ``(1) In general.--A person that commits a violation of 
     section 301 involving the misbranding of a prescription drug 
     (within the meaning of section 502(n)) in a direct-to-
     consumer advertisement shall be assessed a civil penalty if--
       ``(A) the Secretary provides the person written notice of 
     the violation; and
       ``(B) the person fails to correct or cease the 
     advertisement so as to eliminate the violation not later than 
     180 days after the date of the notice.
       ``(2) Amount.--The amount of a civil penalty under 
     paragraph (1)--
       ``(A) shall not exceed $500,000 in the case of an 
     individual and $5,000,000 in the case of any other person; 
     and
       ``(B) shall not exceed $10,000,000 for all such violations 
     adjudicated in a single proceeding.
       ``(3) Procedure.--Paragraphs (3) through (5) of subsection 
     (g) apply with respect to a civil penalty under paragraph (1) 
     of this subsection to the same extent and in the same manner 
     as those paragraphs apply with respect to a civil penalty 
     under paragraph (1) or (2) of subsection (g).''.

     SEC. __03. REPORTS.

       The Secretary of Health and Human Services shall annually 
     submit to the Committee on Health, Education, Labor, and 
     Pensions of the Senate and the Committee on Energy and 
     Commerce of the House of Representatives a report that, for 
     the most recent 1-year period for which data are available--
       (1) provides the total number of direct-to-consumer 
     prescription drug advertisements made by television, radio, 
     the Internet, written publication, or other media;
       (2) identifies, for each such advertisement--
       (A) the dates on which, the times at which, and the markets 
     in which the advertisement was made; and
       (B) the type of advertisement (reminder, help-seeking, or 
     product-claim); and
       (3)(A) identifies the advertisements that violated or 
     appeared to violate section 502(n) of the Federal Food, Drug, 
     and Cosmetic Act (21 U.S.C. 352(n)); and
       (B) describes the actions taken by the Secretary in 
     response to the violations.

     SEC. __04. REVIEW OF DIRECT-TO-CONSUMER DRUG ADVERTISEMENTS.

       (a) In General.--The Secretary of Health and Human Services 
     shall expedite, to the maximum extent practicable, reviews of 
     the legality of direct-to-consumer drug advertisements.
       (b) Policy.--The Secretary of Health and Human Services 
     shall not adopt or follow any policy that would have the 
     purpose or effect of delaying reviews of the legality of 
     direct-to-consumer drug advertisements except--
       (1) as a result of notice-and-comment rulemaking; or
       (2) as the Secretary determines to be necessary to protect 
     public health and safety.
                                 ______
                                 
  SA 1053. Mr. AKAKA submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements to the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       On page 633, after line 21, add the following:
       (3) Application to hawaii.--Section 1923(f) (42 U.S.C. 
     1396r-4(f)), as amended by paragraph (1), is amended--
       (A) by redesignating paragraph (7) as paragraph (8); and
       (B) by inserting after paragraph (6), the following:
       ``(7) Treatment of hawaii as a low-dsh state.--The 
     Secretary shall compute a DSH allotment for the State of 
     Hawaii for each of fiscal years 2004 and 2005 in the same 
     manner as DSH allotments are determined with respect to those 
     States to which paragraph (5) applies (but without regard to 
     the requirement under such paragraph that total expenditures 
     under the State plan for disproportionate share hospital 
     adjustments for any fiscal year exceeds 0).''.
                                 ______
                                 
  SA 1054. Mr. FEINGOLD submitted an amendment intended to be proposed 
by him to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the end of subtitle D of title I, add the following:

     SEC. 133. OFFICE OF THE MEDICARE BENEFICIARY ADVOCATE.

       (a) Establishment.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall establish within 
     the Department of Health and Human Services, an Office of the 
     Medicare Beneficiary Advocate (in this section referred to as 
     the ``Office'').
       (b) Duties.--The Office shall carry out the following 
     activities:
       (1) Establishing a toll-free telephone number for medicare 
     beneficiaries to use to obtain information on the medicare 
     program, and particularly with respect to the benefits 
     provided under part D of title XVIII of the Social Security 
     Act and the Medicare Prescription Drug plans and 
     MedicareAdvantage plans offering such benefits. The Office 
     shall ensure that the toll-free telephone number accommodates 
     beneficiaries with disabilities and limited-English 
     proficiency.
       (2) Establishing an Internet website with easily accessible 
     information regarding Medicare Prescription Drug plans and 
     MedicareAdvantage plans and the benefits offered under such 
     plans. The website shall--
       (A) be updated regularly to reflect changes in services and 
     benefits, including with respect to the plans offered in a 
     region and the associated monthly premiums, benefits offered, 
     formularies, and contact information for such plans, and to 
     ensure that there are no broken links or errors;
       (B) have printer-friendly, downloadable fact sheets on the 
     medicare coverage options and benefits;
       (C) be easy to navigate, with large print and easily 
     recognizable links; and
       (D) provide links to the websites of the eligible entities 
     participating in part D of title XVIII.
       (3) Providing regional publications to medicare 
     beneficiaries that include regional contacts for information, 
     and that inform the beneficiaries of the prescription drug 
     benefit options under title XVIII of the Social Security Act, 
     including with respect to--
       (A) monthly premiums;
       (B) formularies; and
       (C) the scope of the benefits offered.
       (4) Conducting outreach to medicare beneficiaries to inform 
     the beneficiaries of the medicare coverage options and 
     benefits under parts A, B, C, and D of title XVIII of the 
     Social Security Act.
       (5) Working with local benefits administrators, ombudsmen, 
     local benefits specialists, and advocacy groups to ensure 
     that medicare beneficiaries are aware of the medicare 
     coverage options and benefits under parts A, B, C, and D of 
     title XVIII of the Social Security Act.
       (c) Funding.--
       (1) Establishment.--Of the amounts authorized to be 
     appropriated under the Secretary's discretion for 
     administrative expenditures, $2,000,000 may be used to 
     establish the Office in accordance with this section.
       (2) Operation.--With respect to each fiscal year occurring 
     after the fiscal year in which the Office is established 
     under this section, the Secretary may use, out of amounts 
     authorized to be appropriated under the Secretary's 
     discretion for administrative expenditures for such fiscal 
     year, such sums as may be necessary to operate the Office in 
     that fiscal year.
                                 ______
                                 
  SA 1055. Mrs. HUTCHISON (for herself, Mr. Kennedy, Mr. Durbin, Mr. 
Kerry, and Mr. Lautenberg) submitted an amendment intended to be 
proposed to amendment SA 1004 proposed by Mrs. Hutchison to the bill S. 
1, to amend title XVIII of the Social Security Act to make improvements 
in the medicare program, to provide prescription drug coverage under 
the medicare program, and for other purposes; which was ordered to lie 
on the table; as follows:

       In lieu of the matter proposed to be added, add the 
     following:

     SEC. __. REVISION OF THE INDIRECT MEDICAL EDUCATION (IME) 
                   ADJUSTMENT PERCENTAGE.

       (a) In General.--Section 1886(d)(5)(B)(ii) (42 U.S.C. 
     1395ww(d)(5)(B)(ii)) is amended--
       (1) in subclause (VI), by striking ``and'' after the 
     semicolon at the end;
       (2) in subclause (VII)--
       (A) by striking ``on or after October 1, 2002'' and 
     inserting ``during fiscal year 2003''; and
       (B) by striking the period at the end and inserting a 
     semicolon; and
       (3) by adding at the end the following new subclause:
       ``(VIII) during fiscal year 2004, `c' is equal to 1.41; and
       ``(IX) on or after October 1, 2005, `c' is equal to 
     1.47.''.
       (b) Conforming Amendment Relating to Determination of 
     Standardized Amount.--Section 1886(d)(2)(C)(i) (42 U.S.C. 
     1395ww(d)(2)(C)(i)) is amended--
       (1) by striking ``1999 or'' and inserting ``1999,''; and
       (2) by inserting ``, or the Prescription Drug and Medicare 
     Improvement Act of 2003'' after ``2000''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to discharges occurring on or after October 1, 
     2003.
       At the end of subtitle B of title IV, add the following:

     SEC. __. MEDICARE SECONDARY PAYOR (MSP) PROVISIONS.

       (a) Technical Amendment Concerning Secretary's Authority to 
     Make Conditional Payment When Certain Primary Plans Do Not 
     Pay Promptly.--

[[Page S8581]]

       (1) In general.--Section 1862(b)(2) (42 U.S.C. 1395y(b)(2)) 
     is amended--
       (A) in subparagraph (A)(ii), by striking ``promptly (as 
     determined in accordance with regulations)'';
       (B) in subparagraph (B)--
       (i) by redesignating clauses (i) through (iii) as clauses 
     (ii) through (iv), respectively; and
       (ii) by inserting before clause (ii), as so redesignated, 
     the following new clause:
       ``(i) Authority to make conditional payment.--The Secretary 
     may make payment under this title with respect to an item or 
     service if a primary plan described in subparagraph (A)(ii) 
     has not made or cannot reasonably be expected to make payment 
     with respect to such item or service promptly (as determined 
     in accordance with regulations). Any such payment by the 
     Secretary shall be conditioned on reimbursement to the 
     appropriate Trust Fund in accordance with the succeeding 
     provisions of this subsection.''.
       (2) Effective date.--The amendments made by paragraph (1) 
     shall be effective as if included in the enactment of title 
     III of the Medicare and Medicaid Budget Reconciliation 
     Amendments of 1984 (Public Law 98-369).
       (b) Clarifying Amendments to Conditional Payment 
     Provisions.--Section 1862(b)(2) (42 U.S.C. 1395y(b)(2)) is 
     further amended--
       (1) in subparagraph (A), in the matter following clause 
     (ii), by inserting the following sentence at the end: ``An 
     entity that engages in a business, trade, or profession shall 
     be deemed to have a self-insured plan if it carries its own 
     risk (whether by a failure to obtain insurance, or otherwise) 
     in whole or in part.'';
       (2) in subparagraph (B)(ii), as redesignated by subsection 
     (a)(2)(B)--
       (A) by striking the first sentence and inserting the 
     following: ``A primary plan, and an entity that receives 
     payment from a primary plan, shall reimburse the appropriate 
     Trust Fund for any payment made by the Secretary under this 
     title with respect to an item or service if it is 
     demonstrated that such primary plan has or had a 
     responsibility to make payment with respect to such item or 
     service. A primary plan's responsibility for such payment may 
     be demonstrated by a judgment, a payment conditioned upon the 
     recipient's compromise, waiver, or release (whether or not 
     there is a determination or admission of liability) of 
     payment for items or services included in a claim against the 
     primary plan or the primary plan's insured, or by other 
     means.''; and
       (B) in the final sentence, by striking ``on the date such 
     notice or other information is received'' and inserting ``on 
     the date notice of, or information related to, a primary 
     plan's responsibility for such payment or other information 
     is received''; and
       (3) in subparagraph (B)(iii), as redesignated by subsection 
     (a)(2)(B), by striking the first sentence and inserting the 
     following: ``In order to recover payment made under this 
     title for an item or service, the United States may bring an 
     action against any or all entities that are or were required 
     or responsible (directly, as an insurer or self-insurer, as a 
     third-party administrator, as an employer that sponsors or 
     contributes to a group health plan, or large group health 
     plan, or otherwise) to make payment with respect to the same 
     item or service (or any portion thereof) under a primary 
     plan. The United States may, in accordance with paragraph 
     (3)(A) collect double damages against any such entity. In 
     addition, the United States may recover under this clause 
     from any entity that has received payment from a primary plan 
     or from the proceeds of a primary plan's payment to any 
     entity.''.
       (c) Clerical Amendments.--Section 1862(b) (42 U.S.C. 
     1395y(b)) is amended--
       (1) in paragraph (1)(A), by moving the indentation of 
     clauses (ii) through (v) 2 ems to the left; and
       (2) in paragraph (3)(A), by striking ``such'' before 
     ``paragraphs''.
                                 ______
                                 
  SA 1056. Mr. SHELBY (for himself, Ms. Stabenow, Mr. Sessions, Mr. 
Cochran, Mr. Lott, and Mrs. Murray) submitted an amendment intended to 
be proposed by him to the bill S. 1, to amend title XVIII of the Social 
Security Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the end of subtitle A of title IV, add the following:

     SEC. __. TREATMENT OF GRANDFATHERED LONG-TERM CARE HOSPITALS.

       (a) In General.--The last sentence of section 1886(d)(1)(B) 
     is amended by inserting ``, and the Secretary may not impose 
     any special conditions on the operation, size, number of 
     beds, or location of any hospital so classified for continued 
     participation under this title or title XIX or for continued 
     classification as a hospital described in clause (iv)'' 
     before the period at the end.
       (b) Treatment of Proposed Revision.--The Secretary shall 
     not adopt the proposed revision to section 412.22(f) of title 
     42, Code of Federal Regulations contained in 68 Federal 
     Register 27154 (May 19, 2003) or any revision reaching the 
     same or substantially the same result as such revision.
       (c) Effective Date.--The amendment made by, and provisions 
     of, this section shall apply to cost reporting periods ending 
     on or after December 31, 2002.
                                 ______
                                 
  SA 1057. Mrs. DOLE (for herself and Mr. Edwards) submitted an 
amendment intended to be proposed by her to the bill S. 1, to amend 
title XVIII of the Social Security Act to make improvements in the 
medicare program, to provide prescription drug coverage under the 
medicare program, and for other purposes; which was ordered to lie on 
the table; as follows:

       At the end of subtitle A of title IV, add the following:

     SEC. __. TREATMENT OF CERTAIN ENTITIES FOR PURPOSES OF 
                   PAYMENTS UNDER THE MEDICARE PROGRAM.

       (a) Payments to Hospitals.--Notwithstanding any other 
     provision of law, effective for discharges occurring on or 
     after October 1, 2003, for purposes of making payments to 
     hospitals (as defined in section 1886(d) and 1833(t) of the 
     Social Security Act (42 U.S.C. 1395(d)) under the medicare 
     program under title XVIII of such Act (42 U.S.C. 1395 et 
     seq.), Iredell County, North Carolina, and Rowan County, 
     North Carolina, are deemed to be located in the Charlotte-
     Gastonia-Rock Hill, North Carolina, South Carolina 
     Metropolitan Statistical Area.
       (b) Budget Neutral.--The Secretary shall adjust the area 
     wage index referred to in subsection (a) in a manner which 
     assures that the appropriate payments made under section 
     1886(d) of the Social Security Act (42 U.S.C., 1395(ww)(d)) 
     in a fiscal year for the operating cost of inpatient hospital 
     services are not greater or less than those which would have 
     be made in the year if this section did not apply.
       (c) Payments to Skilled Nursing Facilities and Home Health 
     Agencies.--Notwithstanding any other provision of law, 
     effective beginning October 1, 2003, for purposes of making 
     payments to skilled nursing facilities (SNFs) and home health 
     agencies (as defined in sections 1861(j) and 1861(o) of the 
     Social Security Act (42 U.S.C. 1395(j)(o)) under the medicare 
     program under title XVIII of such Act (42 U.S.C 1395 et 
     seq.), Iredell County, North Carolina, and Rowan County, 
     North Carolina, are deemed to be located in the Charlotte-
     Gastonia-Rock Hill, North Carolina, South Carolina 
     Metropolitan Statistical Area.
       (d) Application.--Effective for fiscal year 2004, the 
     skilled nursing facility PPS and home health PPS rates for 
     Iredell County, North Carolina, and Rowan County, North 
     Carolina, will be updated by the prefloor, prereclassified 
     hospital wage index available for the Charlotte-Gastonia-Rock 
     Hill, North Carolina, South Carolina Metropolitan Statistical 
     Area. This provision must be implemented in a budget neutral 
     manner, using a methodology that maintains the current SNF 
     and home health expenditure levels.
                                 ______
                                 
  SA 1058. Mr. CRAIG submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       At the appropriate place in title VI, insert the following:

     SEC. __. RESTORATION OF FEDERAL HOSPITAL INSURANCE TRUST 
                   FUND.

       (a) Definitions.--In this section:
       (1) Clerical error.--The term ``clerical error'' means the 
     failure that occurred on April 15, 2001, to have transferred 
     the correct amount from the general fund of the Treasury to 
     the Trust Fund.
       (2) Trust fund.--The term ``Trust Fund'' means the Federal 
     Hospital Insurance Trust Fund established under section 1817 
     of the Social Security Act (42 U.S.C. 1395i).
       (b) Correction of Trust Fund Holdings.--
       (1) In general.--Not later than 120 days after the date of 
     enactment of this Act, the Secretary of the Treasury shall 
     take the actions described in paragraph (2) with respect to 
     the Trust Fund with the goal being that, after such actions 
     are taken, the holdings of the Trust Fund will replicate, to 
     the extent practicable in the judgment of the Secretary of 
     the Treasury, in consultation with the Secretary of Health 
     and Human Services, the holdings that would have been held by 
     the Trust Fund if the clerical error had not occurred.
       (2) Obligations issued and redeemed.--The Secretary of the 
     Treasury shall--
       (A) issue to the Trust Fund obligations under chapter 31 of 
     title 31, United States Code, that bear issue dates, interest 
     rates, and maturity dates that are the same as those for the 
     obligations that--
       (i) would have been issued to the Trust Fund if the 
     clerical error had not occurred; or
       (ii) were issued to the Trust Fund and were redeemed by 
     reason of the clerical error; and
       (B) redeem from the Trust Fund obligations that would have 
     been redeemed from the Trust Fund if the clerical error had 
     not occurred.
       (c) Appropriation.--Not later than 120 days after the date 
     of enactment of this Act, there is appropriated to the Trust 
     Fund, out of any money in the Treasury not otherwise 
     appropriated, an amount determined by the

[[Page S8582]]

     Secretary of the Treasury, in consultation with the Secretary 
     of Health and Human Services, to be equal to the interest 
     income lost by the Trust Fund through the date on which the 
     appropriation is being made as a result of the clerical 
     error.
                                 ______
                                 
  SA 1059. Mr. HATCH sumitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:
       At the end of subtitle A of title I, add the following:

     SEC. __. REVIEW AND REPORT ON CURRENT STANDARDS OF PRACTICE 
                   FOR PHARMACY SERVICES PROVIDED TO PATIENTS IN 
                   NURSING FACILITIES.

       (a) Review.--
       (1) In general.--The Secretary shall conduct a thorough 
     review of the current standards of practice for pharmacy 
     services provided to patients in nursing facilities.
       (2) Specific matters reviewed.--In conducting the review 
     under paragraph (1), the Secretary shall--
       (A) assess the current standards of practice, clinical 
     services, and other service requirements generally used for 
     pharmacy services in long-term care settings; and
       (B) evaluate the impact of those standards with respect to 
     patient safety, reduction of medication errors and quality of 
     care.
       (b) Report.--
       (1) In general.--Not later than the date that is 18 months 
     after the date of enactment of this Act, the Secretary shall 
     submit a report to Congress on the study conducted under 
     subsection (a)(1), together with any recommendations for 
     legislation that the Administrator determines to be 
     appropriate as a result of such study.
       (2) Contents.--The report submitted under paragraph (1) 
     shall contain--
       (A) a detailed description of the plans of the Secretary to 
     implement the provisions of this Act in a manner consistent 
     with applicable State and Federal laws designed to protect 
     the safety and quality of care of nursing facility patients; 
     and
       (B) recommendations regarding necessary actions and 
     appropriate reimbursement to ensure the provision of 
     prescription drugs to medicare beneficiaries residing in 
     nursing facilities in a manner consistent with existing 
     patient safety and quality of care standards under applicable 
     State and Federal laws.
                                 ______
                                 
  SA 1060. Mr. BAUCUS (for Mrs. Feinstein (for herself, Mr. Nickles, 
Mr. Chafee, and Mr. Graham of South Carolina) proposed an amendment to 
the bill S. 1, to amend title XVIII of the Social Security Act to make 
improvements in the medicare program, to provide prescription drug 
coverage under the medicare program, and for other purposes; as 
follows:
       At the end of title IV, insert:

                       Subtitle D--Part B Premium

     SEC. __. INCOME-RELATED INCREASE IN MEDICARE PART B PREMIUM.

       (a) In General.--Section 1839 (42 U.S.C. 1395r) is amended 
     by adding at the end the following:
       ``(h) Increase in Premium for High-Income Beneficiaries.--
       ``(1) Amount of increase.--
       ``(A) In general.--Except as provided in paragraph (4), if 
     the modified adjusted gross income of an individual for a 
     taxable year ending with or within a calendar year (as 
     initially determined by the Secretary in accordance with 
     paragraph (2)) exceeds the threshold amount, the amount of 
     the premium under subsection (a) for the individual for the 
     calendar year shall, in lieu of the amount otherwise 
     determined under subsection (a), be equal to the applicable 
     percentage of an amount equal to 200 percent of the monthly 
     actuarial rate for enrollees age 65 and over as determined 
     under subsection (a)(1) for the calendar year.
       ``(B) Applicable percentage.--The term `applicable 
     percentage' means the percentage determined in accordance 
     with the following tables:
       ``(i) Individuals not filing joint returns.--
  
``If the modified adjusted gross income exceeds the threshold amount 
  by:                                     The applicable percentage is:
Not more than $25,000........................................50 percent
More than $25,000..........................................100 percent.
       ``(ii) Individuals filing joint returns.--
  
``If the modified adjusted gross income exceeds the threshold amount 
  by:                                     The applicable percentage is:
Not more than $50,000........................................50 percent
More than $50,000..........................................100 percent.
       ``(C) Definition of threshold amount.--For purposes of this 
     subsection, the term `threshold amount' means--
       ``(i) except as provided in clause (ii), $75,000; and
       ``(ii) $150,000 in the case of a taxpayer filing a joint 
     return.
       ``(D) Inflation adjustment for threshold amount.--
       ``(i) In general.--In the case of any calendar year 
     beginning after 2006, the dollar amount in clause (i) of 
     subparagraph (C) shall be increased by an amount equal to--

       ``(I) such dollar amount, multiplied by
       ``(II) the percentage (if any) by which the average of the 
     Consumer Price Index for all urban consumers (United States 
     city average) for the 12-month period ending with June of the 
     preceding calendar year exceeds such average for the 12-month 
     period ending with June 2005.

       ``(ii) Joint returns.--The dollar amount described in 
     clause (ii) of subparagraph (C) for any calendar year after 
     2006 shall be increased to an amount equal to twice the 
     amount in effect under clause (i) of subparagraph (C) (after 
     application of this subparagraph).
       ``(iii) Rounding.--If any dollar amount after being 
     increased under clause (i) is not a multiple of $1,000, such 
     dollar amount shall be rounded to the nearest multiple of 
     $1,000.
       ``(E) Definition of modified adjusted gross income.--For 
     purposes of this subsection, the term `modified adjusted 
     gross income' means adjusted gross income (as defined in 
     section 62 of the Internal Revenue Code of 1986)--
       ``(i) determined without regard to sections 135, 911, 931, 
     and 933 of such Code; and
       ``(ii) increased by the amount of interest received or 
     accrued by the taxpayer during the taxable year which is 
     exempt from tax under such Code.
       ``(F) Joint return.--For purposes of this subsection, the 
     term `joint return' has the meaning given such term by 
     section 7701(a)(38) of the Internal Revenue Code of 1986.
       ``(2) Determination of modified adjusted gross income.--The 
     Secretary shall make an initial determination of the amount 
     of an individual's modified adjusted gross income for a 
     taxable year ending with or within a calendar year for 
     purposes of this subsection as follows:
       ``(A) Notice.--Not later than September 1 of the year 
     preceding the year, the Secretary shall provide notice to 
     each individual whom the Secretary finds (on the basis of the 
     individual's actual modified adjusted gross income for the 
     most recent taxable year for which such information is 
     available or other information provided to the Secretary by 
     the Secretary of the Treasury) will be subject to an increase 
     under this subsection that the individual will be subject to 
     such an increase, and shall include in such notice the 
     Secretary's estimate of the individual's modified adjusted 
     gross income for the year. In providing such notice, the 
     Secretary shall use the most recent poverty line available as 
     of the date the notice is sent.
       ``(B) Calculation based on information provided by 
     beneficiary.--If, during the 60-day period beginning on the 
     date notice is provided to an individual under subparagraph 
     (A), the individual provides the Secretary with appropriate 
     information (as determined by the Secretary) on the 
     individual's anticipated modified adjusted gross income for 
     the year, the amount initially determined by the Secretary 
     under this paragraph with respect to the individual shall be 
     based on the information provided by the individual.
       ``(C) Calculation based on notice amount if no information 
     is provided by the beneficiary or if the secretary determines 
     that the provided information in not appropriate.--The amount 
     initially determined by the Secretary under this paragraph 
     with respect to an individual shall be the amount included in 
     the notice provided to the individual under subparagraph (A) 
     if--
       ``(i) the individual does not provide the Secretary with 
     information under subparagraph (B); or
       ``(ii) the Secretary determines that the information 
     provided by the individual to the Secretary under such 
     subparagraph in not appropriate.
       ``(3) Adjustments.--
       ``(A) In general.--If the Secretary determines (on the 
     basis of final information provided by the Secretary of the 
     Treasury) that the amount of an individual's actual modified 
     adjusted gross income for a taxable year ending with or 
     within a calendar year is less than or greater than the 
     amount initially determined by the Secretary under paragraph 
     (2), the Secretary shall increase or decrease the amount of 
     the individual's monthly premium under this part (as the case 
     may be) for months during the following calendar year by an 
     amount equal to \1/12\ of the difference between--
       ``(i) the total amount of all monthly premiums paid by the 
     individual under this part during the previous calendar year; 
     and
       ``(ii) the total amount of all such premiums which would 
     have been paid by the individual during the previous calendar 
     year if the amount of the individual's modified adjusted 
     gross income initially determined under paragraph (2) were 
     equal to the actual amount of the individual's modified 
     adjusted gross income determined under this paragraph.
       ``(B) Interest.--
       ``(i) Increase.--In the case of an individual for whom the 
     amount initially determined by the Secretary under paragraph 
     (2) is based on information provided by the individual under 
     subparagraph (B) of such paragraph, if the Secretary 
     determines under subparagraph (A) that the amount of the 
     individual's actual modified adjusted gross income for a 
     taxable year is greater than the amount initially determined 
     under paragraph (2), the Secretary shall increase the amount 
     otherwise determined for the year under subparagraph (A) by 
     an amount of interest equal to the sum of the amounts 
     determined under

[[Page S8583]]

     clause (ii) for each of the months described in such clause.
       ``(ii) Computation.--Interest shall be computed for any 
     month in an amount determined by applying the underpayment 
     rate established under section 6621 of the Internal Revenue 
     Code of 1986 (compounded daily) to any portion of the 
     difference between the amount initially determined under 
     paragraph (2) and the amount determined under subparagraph 
     (A) for the period beginning on the first day of the month 
     beginning after the individual provided information to the 
     Secretary under subparagraph (B) of paragraph (2) and ending 
     30 days before the first month for which the individual's 
     monthly premium is increased under this paragraph.
       ``(iii) Exception.--Interest shall not be imposed under 
     this subparagraph if the amount of the individual's modified 
     adjusted gross income provided by the individual under 
     subparagraph (B) of paragraph (2) was not less than the 
     individual's modified adjusted gross income determined on the 
     basis of information shown on the return of tax imposed by 
     chapter 1 of the Internal Revenue Code of 1986 for the 
     taxable year involved.
       ``(C) Steps to recover amounts due from previously enrolled 
     beneficiaries.--In the case of an individual who is not 
     enrolled under this part for any calendar year for which the 
     individual's monthly premium under this part for months 
     during the year would be increased pursuant to subparagraph 
     (A) if the individual were enrolled under this part for the 
     year, the Secretary may take such steps as the Secretary 
     considers appropriate to recover from the individual the 
     total amount by which the individual's monthly premium under 
     this part for months during the year would have been 
     increased under subparagraph (A) if the individual were 
     enrolled under this part for the year.
       ``(D) Deceased beneficiary.--In the case of a deceased 
     individual for whom the amount of the monthly premium under 
     this part for months in a year would have been decreased 
     pursuant to subparagraph (A) if the individual were not 
     deceased, the Secretary shall make a payment to the 
     individual's surviving spouse (or, in the case of an 
     individual who does not have a surviving spouse, to the 
     individual's estate) in an amount equal to the difference 
     between--
       ``(i) the total amount by which the individual's premium 
     would have been decreased for all months during the year 
     pursuant to subparagraph (A); and
       ``(ii) the amount (if any) by which the individual's 
     premium was decreased for months during the year pursuant to 
     subparagraph (A).
       ``(4) Waiver by secretary.--The Secretary may waive the 
     imposition of all or part of the increase of the premium or 
     all or part of any interest due under this subsection for any 
     period if the Secretary determines that a gross injustice 
     would otherwise result without such waiver.
       ``(5) Transfer to part b trust fund.--
       ``(A) In general.--The Secretary shall transfer amounts 
     received pursuant to this subsection to the Federal 
     Supplementary Medical Insurance Trust Fund.
       ``(B) Disregard.--In applying section 1844(a), amounts 
     attributable to subparagraph (A) shall not be counted in 
     determining the dollar amount of the premium per enrollee 
     under paragraph (1)(A) or (1)(B) thereof.''
       (b) Conforming Amendments.--(1) Section 1839 (42 U.S.C. 
     1395r) is amended--
       (A) in subsection (a)(2), by inserting ``or section 
     subsection (h)'' after ``subsections (b) and (e)'';
       (B) in subsection (a)(3) of section 1839(a), by inserting 
     ``or subsection (h)'' after ``subsection (e)'';
       (C) in subsection (b), inserting ``(and as increased under 
     subsection (h))'' after ``subsection (a) or (e)''; and
       (D) in subsection (f), by striking ``if an individual'' and 
     inserting the following: ``if an individual (other than an 
     individual subject to an increase in the monthly premium 
     under this section pursuant to subsection (h))''.
       (2) Section 1840(c) (42 U.S.C. 1395r(c)) is amended by 
     inserting ``or an individual determines that the estimate of 
     modified adjusted gross income used in determining whether 
     the individual is subject to an increase in the monthly 
     premium under section 1839 pursuant to subsection (h) of such 
     section (or in determining the amount of such increase) is 
     too low and results in a portion of the premium not being 
     deducted,'' before ``he may''.
       (c) Reporting Requirements for Secretary of the Treasury.--
       (1) In general.--Subsection (l) of section 6103 of the 
     Internal Revenue Code of 1986 (relating to confidentiality 
     and disclosure of returns and return information) is amended 
     by adding at the end the following new paragraph:
       ``(19) Disclosure of return information to carry out 
     income-related reduction in medicare part b premium.--
       ``(A) In general.--The Secretary may, upon written request 
     from the Secretary of Health and Human Services, disclose to 
     officers and employees of the Centers for Medicare & Medicaid 
     Services return information with respect to a taxpayer who is 
     required to pay a monthly premium under section 1839 of the 
     Social Security Act. Such return information shall be limited 
     to--
       ``(i) taxpayer identity information with respect to such 
     taxpayer,
       ``(ii) the filing status of such taxpayer,
       ``(iii) the adjusted gross income of such taxpayer,
       ``(iv) the amounts excluded from such taxpayer's gross 
     income under sections 135 and 911,
       ``(v) the interest received or accrued during the taxable 
     year which is exempt from the tax imposed by chapter 1 to the 
     extent such information is available, and
       ``(vi) the amounts excluded from such taxpayer's gross 
     income by sections 931 and 933 to the extent such information 
     is available.
       ``(B) Restriction on use of disclosed information.--Return 
     information disclosed under subparagraph (A) may be used by 
     officers and employees of the Centers for Medicare & Medicaid 
     Services only for the purposes of, and to the extent 
     necessary in, establishing the appropriate monthly premium 
     under section 1839 of the Social Security Act.''
       (2) Conforming amendments.--
       (A) Paragraph (3)(A) of section 6103(p) of such Code is 
     amended by striking ``or (18)'' each place it appears and 
     inserting ``(18), or (19)''.
       (B) Paragraph (4) of section 6103(p) of such Code is 
     amended by striking ``or (16)'' and inserting ``(16), or 
     (19)''.
       (d) Effective Date.--
       (1) In general.--The amendments made by subsections (a) and 
     (b) shall apply to the monthly premium under section 1839 of 
     the Social Security Act for months beginning with January 
     2006.
       (2) Information for prior years.--The Secretary of Health 
     and Human Services may request information under section 
     6013(l)(19) of the Social Security Act (as added by 
     subsection (c)) for taxable years beginning after December 
     31, 2002.
                                 ______
                                 
  SA 1061. Mr. BAUCUS (for Mr. Akaka (for himself and Mr. Inouye)) 
proposed an amendment to the bill S. 1, to amend title XVIII of the 
Social Security Act to make improvements in the medicare program, to 
provide prescription drug coverage under the medicare program, and for 
other purposes; as follows:

       On page 633, after line 21, add the following:
       (3) Application to hawaii.--Section 1923(f) (42 U.S.C. 
     1396r-4(f)), as amended by paragraph (1), is amended--
       (A) by redesignating paragraph (7) as paragraph (8); and
       (B) by inserting after paragraph (6), the following:
       ``(7) Treatment of hawaii as a low-dsh state.--The 
     Secretary shall compute a DSH allotment for the State of 
     Hawaii for each of fiscal years 2004 and 2005 in the same 
     manner as DSH allotments are determined with respect to those 
     States to which paragraph (5) applies (but without regard to 
     the requirement under such paragraph that total expenditures 
     under the State plan for disproportionate share hospital 
     adjustments for any fiscal year exceeds 0).''.
                                 ______
                                 
  SA 1062. Mr. REID (for Mrs. Boxer) proposed an amendment to amendment 
SA 974 proposed by Mr. Grassley (for himself, Mr. Leahy, Ms. Cantwell, 
Mr. Durbin, and Mr. Kohl) the bill S. 1, to amend title XVIII of the 
Social Security Act to make improvements in the medicare program, to 
provide prescription drug coverage under the medicare program, and for 
other purposes; as follows:

       At the end of the amendment add the following:

     ``SEC.___. NO COVERAGE GAP FOR ELIGIBLE BENEFICIARIES WITH 
                   CANCER.--

       ``(A) In general.--In the case of an eligible beneficiary 
     with cancer, the following rules shall apply:
       ``(i) Paragraph (2) shall be applied by substituting `up to 
     the annual out-of-pocket limit under paragraph (4)' for `up 
     to the initial coverage limit under paragraph (3)'.
       ``(ii) The Administrator shall not apply paragraph (3), 
     subsection (d)(1)(C), or paragraph (1)(D), (2)(D), or 
     (3)(A)(iv) of section 1860D-19(a).
       ``(B) Procedures.--The Administrator shall establish 
     procedures to carry out this paragraph. Such procedures shall 
     provide for the adjustment of payments to eligible entities 
     under section 1860D-16 that are necessary because of the 
     rules under subparagraph (A).
                                 ______
                                 
  SA 1063. Ms. COLLINS submitted an amendment intended to be proposed 
by her to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the appropriate place in title IV, insert the following:

     SEC. __. MEDICARE PANCREATIC ISLET CELL TRANSPLANT 
                   DEMONSTRATION PROJECT.

       (a) Establishment.--In order to test the appropriateness of 
     pancreatic islet cell transplantation, not later than 120 
     days after the date of the enactment of this Act, the 
     Secretary shall establish a demonstration project which the 
     Secretary, provides for

[[Page S8584]]

     payment under the medicare program under title XVIII of the 
     Social Security Act for pancreatic islet cell transplantation 
     and related items and services in the case of medicare 
     beneficiaries who have type I (juvenile) diabetes and have 
     end stage renal disease.
       (b) Duration of Project.--The authority of the Secretary to 
     conduct the demonstration project under this section shall 
     terminate on the date that is 5 years after the date of the 
     establishment of the project.
       (c) Evaluation and Report.--The Secretary shall conduct an 
     evaluation of the outcomes of the demonstration project. Not 
     later than 120 days after the date of the termination of the 
     demonstration project under subsection (b), the Secretary 
     shall submit to Congress a report on the project, including 
     recommendations for such legislative and administrative 
     action as the Secretary deems appropriate.
       (d) Payment Methodology.--The Secretary shall establish an 
     appropriate payment methodology for the provision of items 
     and services under the demonstration project, which may 
     include a payment methodology that bundles, to the maximum 
     extent feasible, payment for all such items and services.
                                 ______
                                 
  SA 1064. Ms. SNOWE (for herself, Mr. Rockefeller, and Mr. Smith) 
submitted an amendment intended to be proposed by her to the bill S. 1, 
to amend title XVIII of the Social Security Act to make improvements in 
the medicare program, to provide prescription drug coverage under the 
medicare program, and for other purposes; which was ordered to lie on 
the table; as follows:

       At the end of title VI, insert the following:

     SEC. __. MEDICARE COVERAGE OF ALL ANTICANCER ORAL DRUGS.

       (a) In General.--Section 1861(s)(2)(Q) (42 U.S.C. 
     1395x(s)(2)(Q)) is amended by striking ``chemotherapeutic 
     agent for a given indication,'' and all that follows and 
     inserting ``agent for a medically accepted indication (as 
     defined in subsection (t)(2)(B));''.
       (b) Conforming Amendment.--Section 1834(j)(5)(F)(iv) (42 
     U.S.C. 1395m(j)(5)(F)(iv)) is amended by striking 
     ``therapeutic''.
       (c) Effective Date.--The amendments made by this section 
     shall apply with respect to drugs furnished during the period 
     that begins on January 1, 2004 and ends on January 1, 2006. 
     After January 1, 2006, the Social Security Act shall be 
     applied and administered as if the amendments made by this 
     subsection had never been enacted.
                                 ______
                                 
  SA 1065. Mr. BINGAMAN (for himself, Mr. Domenici, Ms. Mikulski, and 
Mrs. Lincoln) proposed an amendment to the bill S. 1, to amend title 
XVIII of the Social Security Act to make improvements in the medicare 
program, to provide prescription drug coverage under the medicare 
program, and for other purposes; as follows:

       On page 120, between lines 16 and 17, insert the following:
       ``(I) Update of asset or resource test.--With respect to 
     eligibility determinations for premium and cost-sharing 
     subsidies under this section that are made on or after 
     January 1, 2009, such determinations shall be made (to the 
     extent a State, as of such date, has not already eliminated 
     the application of an asset or resource test under section 
     1905(p)(1)(C)) in accordance with the following:
       ``(i) Self-declaration of value.--

       ``(I) In general.--A State shall permit an individual 
     applying for such subsidies to declare and certify by 
     signature under penalty of perjury on the application form 
     that the value of the individual's assets or resources (or 
     the combined value of the individual's assets or resources 
     and the assets or resources of the individual's spouse), as 
     determined under section 1613 for purposes of the 
     supplemental security income program, does not exceed 
     $10,0000 ($20,000 in the case of the combined value of the 
     individual's assets or resources and the assets or resources 
     of the individual's spouse).
       ``(II) Annual adjustment.--Beginning on January 1, 2010, 
     and for each subsequent year, the dollar amounts specified in 
     subclause (I) for the preceding year shall be increased by 
     the percentage increase in the Consumer Price Index for all 
     urban consumers (U.S. urban average) for the 12-month period 
     ending with June of the previous year.

       ``(ii) Methodology flexibility.--Nothing in clause (i) 
     shall be construed as prohibiting a State in making 
     eligibility determinations for premium and cost-sharing 
     subsidies under this section from using asset or resource 
     methodologies that are less restrictive than the 
     methodologies used under 1613 for purposes of the 
     supplemental security income program.
       ``(J) Development of model declaration form.--The Secretary 
     shall--
       ``(i) develop a model, simplified application form for 
     individuals to use in making a self-declaration of assets or 
     resources in accordance with subparagraph (I)(i); and
       ``(ii) provide such form to States and, for purposes of 
     outreach under section 1144, the Commissioner of Social 
     Security.''.
                                 ______
                                 
  SA 1066. Mr. BINGAMAN proposed an amendment to the bill S. 1, to 
amend title XVIII of the Social Security Act to make improvements in 
the medicare program, to provide prescription drug coverage under the 
medicare program, and for other purposes; as follows:

       On page 137, line 6, strike ``Notwithstanding'' and insert 
     ``Except as provided in paragraph (4) and notwithstanding''.
       On page 138, line 2, strike ``or `G' '' and insert `` `G', 
     or a policy described in paragraph (4)''.
       On page 138, line 17, insert ``, who seeks to enroll with 
     the same issuer who was the issuer of the policy described in 
     clause (ii) of such subparagraph in which the individual was 
     enrolled (unless such issuer does not offer at least one of 
     the policies described in paragraph (4)),'' after ``section 
     1860D-2(b)(2)''.
       On page 140, between lines 13 and 14, insert the following:
       ``(4) New standards.--In applying subsection (p)(1)(E) 
     (including permitting the NAIC to revise its model 
     regulations in response to changes in law) with respect to 
     the change in benefits resulting from title I of the 
     Prescription Drug and Medicare Improvement Act of 2003, with 
     respect to policies issued to individuals who are enrolled in 
     a Medicare Prescription Drug plan under part D or under a 
     contract under section 1860D-3(e), the changes in standards 
     shall only provide for substituting (for the benefit packages 
     described in paragraph (2)(B)(ii) that included coverage for 
     prescription drugs) two benefit packages that shall be 
     consistent with the following:
       ``(A) First new policy.--The policy described in this 
     subparagraph has the following benefits, notwithstanding any 
     other provision of this section relating to a core benefit 
     package:
       ``(i) The policy should provide coverage for benefits other 
     than prescription drugs similar to the coverage for benefits 
     other than prescription drugs provided under a medicare 
     supplemental policy which had a benefit package classified as 
     `H' before the date of enactment of the Prescription Drug and 
     Medicare Improvement Act of 2003.
       ``(ii) The policy should provide coverage for prescription 
     drugs that--

       ``(I) compliments, but does not duplicate, the benefits 
     available under part D; and
       ``(II) does not cover 100 percent of the deductible, 
     copayments, coinsurance (including any cost-sharing 
     applicable under the limitation on out-of-pocket 
     expenditures), or any other cost-sharing applicable under 
     part D.

       ``(B) Second new policy.--The policy described in this 
     subparagraph has the same benefits as the policy described in 
     subparagraph (A), except that the reference to the benefit 
     package classified as `H' in clause (i) of such subparagraph 
     is deemed to be a reference to the benefit package classified 
     as `J'.
       (b) Report.--The Secretary shall enter into an arrangement 
     with the National Association of Insurance Commissioners (in 
     this section referred to as the ``NAIC'') under which, not 
     later than 18 months after the date of enactment of this Act, 
     the NAIC shall submit to Congress a report on the medicare 
     supplemental policies described in section 1882(v)(4) of the 
     Social Security Act, as added by subsection (a), that 
     assesses the viability of the policies described in such 
     section and, if viable, the details of those policies.
                                 ______
                                 
  SA 1067. Mrs. LINCOLN submitted an amendment intended to be proposed 
by her to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 510, after line 18, add the following:

     SEC. __. MEDICARE COVERAGE OF KIDNEY DISEASE EDUCATION 
                   SERVICES.

       (a) Coverage of Kidney Disease Education Services.--
       (1) In general.--Section 1861 of the Social Security Act 
     (42 U.S.C.1395x) is amended--
       (A) in subsection (s)(2)--
       (i) in subparagraph (U), by striking ``and'' at the end;
       (ii) in subparagraph (V)(iii), by adding ``and'' at the 
     end; and
       (iii) by adding at the end the following new subparagraph:
       ``(W) kidney disease education services (as defined in 
     subsection (ww));''; and
       (B) by adding at the end the following new subsection:

                  ``Kidney Disease Education Services

       ``(ww)(1) The term `kidney disease education services' 
     means educational services that are--
       ``(A) furnished to an individual with kidney disease who, 
     according to accepted clinical guidelines identified by the 
     Secretary, will require dialysis or a kidney transplant;
       ``(B) furnished, upon the referral of the physician 
     managing the individual's kidney condition, by a qualified 
     person (as defined in paragraph (2)); and
       ``(C) designed--
       ``(i) to provide comprehensive information regarding--
       ``(I) the management of comorbidities;
       ``(II) the prevention of uremic complications; and
       ``(III) each option for renal replacement therapy 
     (including peritoneal dialysis, hemodialysis (including 
     vascular access options), and transplantation); and
       ``(ii) to ensure that the individual has the opportunity to 
     actively participate in the choice of therapy.

[[Page S8585]]

       ``(2) The term `qualified person' means--
       ``(A) a physician (as described in subsection (r)(1));
       ``(B) an individual who--
       ``(i) is--
       ``(I) a registered nurse;
       ``(II) a registered dietitian or nutrition professional (as 
     defined in subsection (vv)(2));
       ``(III) a clinical social worker (as defined in subsection 
     (hh)(1));
       ``(IV) a physician assistant, nurse practitioner, or 
     clinical nurse specialist (as those terms are defined in 
     subsection (aa)(5)); or
       ``(V) a transplant coordinator; and
       ``(ii) meets such requirements related to experience and 
     other qualifications that the Secretary finds necessary and 
     appropriate for furnishing the services described in 
     paragraph (1); or
       ``(C) a renal dialysis facility subject to the requirements 
     of section 1881(b)(1) with personnel who--
       ``(i) provide the services described in paragraph (1); and
       ``(ii) meet the requirements of subparagraph (A) or (B).
       ``(3) The Secretary shall develop the requirements under 
     paragraph (2)(B)(ii) after consulting with physicians, health 
     educators, professional organizations, accrediting 
     organizations, kidney patient organizations, dialysis 
     facilities, transplant centers, network organizations 
     described in section 1881(c)(2), and other knowledgeable 
     persons.
       ``(4) In promulgating regulations to carry out this 
     subsection, the Secretary shall ensure that such regulations 
     ensure that each beneficiary who is entitled to kidney 
     disease education services under this title receives such 
     services in a timely manner that ensures that the beneficiary 
     receives the maximum benefit of those services.
       ``(5) The Secretary shall monitor the implementation of 
     this subsection to ensure that beneficiaries who are eligible 
     for kidney disease education services receive such services 
     in the manner described in paragraph (4).''.
       (2) Payment under physician fee schedule.--Section 
     1848(j)(3) of such Act (42 U.S.C. 1395w-4(j)(3)) is amended 
     by inserting ``, (2)(W)'', after ``(2)(S)''.
       (3) Payment to renal dialysis facilities.--Section 1881(b) 
     of such Act (42 U.S.C. 1395rr(b)), as amended by section 
     433(b)(5), is further amended by adding at the end the 
     following new paragraph:
       ``(13) For purposes of paragraph (7), the single composite 
     weighted formulas determined under such paragraph shall not 
     take into account the amount of payment for kidney disease 
     education services (as defined in section 1861(ww)). Instead, 
     payment for such services shall be made to the renal dialysis 
     facility on an assignment-related basis under section 
     1848.''.
       (4) Annual report to congress.--Not later than April 1, 
     2004, and annually thereafter, the Secretary of Health and 
     Human Services shall submit to Congress a report on the 
     number of medicare beneficiaries who are entitled to kidney 
     disease education services (as defined in section 1861(ww) of 
     the Social Security Act, as added by paragraph (1)) under 
     title XVIII of such Act and who receive such services, 
     together with such recommendations for legislative and 
     administrative action as the Secretary determines to be 
     appropriate to fulfill the legislative intent that resulted 
     in the enactment of that subsection.
       (b) Effective Date.--The amendments made by this section 
     shall apply to services furnished on or after the date that 
     is 6 months after the date of enactment of this Act.
                                 ______
                                 
  SA 1068. Mrs. LINCOLN submitted an amendment intended to be proposed 
by her to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 510, after line 18, add the following:

     SEC. __. MEDICARE COVERAGE OF DIABETES LABORATORY DIAGNOSTIC 
                   TESTS.

       (a) Coverage.--Section 1861(s)(2) of the Social Security 
     Act (42 U.S.C. 1395x(s)(2)) is amended--
       (1) in subparagraph (U), by striking ``and'' at the end;
       (2) in subparagraph (V)(iii), by adding ``and'' at the end; 
     and
       (3) by adding at the end the following new subparagraph:
       ``(W) diabetes screening tests and services (as defined in 
     subsection (ww));''.
       (b) Services Described.--Section 1861 of the Social 
     Security Act (42 U.S.C. 1395x) is amended by adding at the 
     end the following new subsection:

                ``Diabetes Screening Tests and Services

       ``(ww)(1) The term `diabetes screening tests' means 
     diagnostic testing furnished to an individual at risk for 
     diabetes (as defined in paragraph (2)) for the purpose of 
     early detection of diabetes, including--
       ``(A) a fasting plasma glucose test; and
       ``(B) such other tests, and modifications to tests, as the 
     Secretary determines appropriate, in consultation with 
     appropriate organizations.
       ``(2) For purposes of paragraph (1), the term `individual 
     at risk for diabetes' means an individual who has any, a 
     combination of, or all of the following risk factors for 
     diabetes:
       ``(A) A family history of diabetes.
       ``(B) Overweight defined as a body mass index greater than 
     or equal to 25 kg/m\2\.
       ``(C) Habitual physical inactivity.
       ``(D) Belonging to a high-risk ethnic or racial group.
       ``(E) Previous identification of an elevated impaired 
     fasting glucose.
       ``(F) Identification of impaired glucose tolerance.
       ``(G) Hypertension.
       ``(H) Dyslipidemia.
       ``(I) History of gestational diabetes mellitus or delivery 
     of a baby weighing greater than 9 pounds.
       ``(J) Polycystic ovary syndrome.
       ``(3) The Secretary shall establish standards, in 
     consultation with appropriate organizations, regarding the 
     frequency of diabetes screening tests, except that such 
     frequency may not be more often than twice within the 12-
     month period following the date of the most recent diabetes 
     screening test of that individual.''.
       (c) Frequency.--Section 1862(a)(1) of the Social Security 
     Act (42 U.S.C. 1395y(a)(1)) is amended--
       (1) in subparagraph (H), by striking ``and'' at the end;
       (2) in subparagraph (I), by striking the semicolon at the 
     end and inserting ``, and''; and
       (3) by adding at the end the following new subparagraph:
       ``(J) in the case of a diabetes screening test or service 
     (as defined in section 1861(ww)(1)), which is performed more 
     frequently than is covered under section 1861(ww)(3).''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to tests furnished on or after the date that is 
     90 days after the date of enactment of this Act.
                                 ______
                                 
  SA 1069. Mrs. LINCOLN sumitted an amendment intended to be proposed 
by her to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 499, after line 20, insert the following:

     SEC. __. ELIMINATION OF COST-SHARING FOR BONE MASS 
                   MEASUREMENTS.

       (a) Elimination of Coinsurance.--
       (1) In general.--Section 1833(a)(1)(N) of the Social 
     Security Act (42 U.S.C. 1395l(a)(1)(N)) is amended--
       (A) by inserting ``other than bone mass measurement 
     described in section 1861(s)(15)'' after ``(as defined in 
     section 1848(j)(3))''; and
       (B) by adding after the comma at the end the following: 
     ``and in the case of such services consisting of such a bone 
     mass measurement, the amounts paid shall be 100 percent of 
     such payment basis,''.
       (2) Elimination of coinsurance in outpatient hospital 
     settings.--The third sentence of section 1866(a)(2)(A) of the 
     Social Security Act (42 U.S.C. 1395cc(a)(2)(A)) is amended by 
     inserting after ``1861(s)(10)(A)'' the following: ``, with 
     respect to bone mass measurement (as defined in section 
     1861(rr)),''.
       (b) Waiver of Deductible.--The first sentence of section 
     1833(b) of the Social Security Act (42 U.S.C. 1395l(b)), as 
     amended by section 432(b), is further amended--
       (1) by striking ``and'' before ``(5)''; and
       (2) by inserting before the period at the end the 
     following: ``, and (6) such deductible shall not apply with 
     respect to bone mass measurement (as defined in section 
     1861(rr))''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to items and services furnished on or after 
     January 1, 2004.
                                 ______
                                 
  SA 1070. Mr. SCHUMER sumitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       On page 120, strike lines 3 through 16, and insert the 
     following:
       ``(H) Nonapplication to dual eligible individuals.--In the 
     case of an individual who is a dual eligible individual--
       ``(i) the subsidies provided under this section shall not 
     apply; and
       ``(ii) such individuals may be provided with medical 
     assistance for covered outpatient drugs (as such term is 
     defined for purposes of section 1927) in accordance with the 
     State medicaid program under title XIX.
       On page 122, line 1, strike ``and territorial residents''.
       Beginning on page 149, strike line 22 and all that follows 
     through page 152, line 3, and insert the following:
       ``(e) Definitions.--For purposes of this section, the''.
       On page 152, strike lines 8 through 11, and insert the 
     following:
       (2) Exemption from funding limitation for the commonwealth 
     of puerto rico and the territories.--
       (A) In general.--Section 1108(g) (42 U.S.C. 1308(g)) is 
     amended by adding at the end the following new paragraph:
       ``(3) Certain payments disregarded.--The limitations under 
     subsection (f) and the previous provisions of this subsection 
     shall be

[[Page S8586]]

     applied without regard to any payments made for medical 
     assistance for covered drugs (as defined in section 
     1860D(a)(2)) under title XIX for dual eligible individuals 
     (as defined in section 1860D-19(a)(4)(E) or for any payments 
     made in carrying out section 1935.''.
       (B) Conforming amendment.--Section 1108(f) (42 U.S.C. 
     1308(f)) is amended by inserting ``and section 
     1935(e)(1)(B)'' after ``Subject to subsection (g)''.
                                 ______
                                 
  SA 1071. Mr. ROCKEFELLER (for himself and Mr. Smith) sumitted an 
amendment intended to be proposed by him to the bill S. 1, to amend 
title XVIII of the Social Security Act to make improvements in the 
medicare program, to provide prescription drug coverage under the 
medicare program, and for other purposes; which was ordered to lie on 
the table; as follows:

       At the end of title VI, insert the following:

     SEC. __. MEDICARE COVERAGE OF ALL ANTINEOPLASTIC AND CERTAIN 
                   OTHER DRUGS.

       (a) In General.--Section 1861(s)(2)(Q) (42 U.S.C. 
     1395x(s)(2)(Q)) is amended by striking ``prescribed for use 
     as an anticancer chemotherapeutic agent'' and all that 
     follows and inserting ``prescribed for use as--
       ``(i) an antineoplastic agent for a medically accepted 
     anticancer indication (as defined in subsection (t)(2)(B)), 
     excluding (except as provided in subparagraph (T)) drugs for 
     chemotherapy-induced nausea; or
       ``(ii) an oral alternative to IV-administered medications, 
     but only if the Secretary determines such coverage does not 
     result, as estimated by the Secretary, in expenditures made 
     under this title during any 5-year period that are greater 
     than the expenditures that would have been made under this 
     title during such period if such coverage was not 
     provided.''.
       (b) Conforming Amendment.--Section 1834(j)(5)(F)(iv) (42 
     U.S.C. 1395m(j)(5)(F)(iv)) is amended to read as follows:
       ``(iv) oral drugs described in section 1861(s)(2)(Q); 
     and''.
       (c) Effective Date.--The amendments made by this section 
     shall apply only with respect to drugs furnished during the 
     period that begins on or after the date that is 90 days after 
     the date of the enactment of this Act and ends on January 1, 
     2006. After January 1, 2006, the Social Security Act shall be 
     applied and administered as if the amendments made by this 
     section had never been enacted.
                                 ______
                                 
  SA 1072. Mr. ROCKEFELLER submitted an amendment intended to be 
proposed by him to the bill S. 1, to amend title XVIII of the Social 
Security Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the end of title VI, insert the following:

     SEC. __. MEDICARE COVERAGE OF ALL ANTINEOPLASTIC AND CERTAIN 
                   OTHER DRUGS; PUBLIC DISCLOSURE OF MARKET-BASED 
                   DRUG PRICING INFORMATION.

       (a) Medicare Coverage of All Antineoplastic and Certain 
     Other Drugs.--
       (1) In general.--Section 1861(s)(2)(Q) (42 U.S.C. 
     1395x(s)(2)(Q)) is amended by striking ``prescribed for use 
     as an anticancer chemotherapeutic agent'' and all that 
     follows and inserting ``prescribed for use as--
       ``(i) an antineoplastic agent for a medically accepted 
     anticancer indication (as defined in subsection (t)(2)(B)), 
     excluding (except as provided in subparagraph (T)) drugs for 
     chemotherapy-induced nausea; or
       ``(ii) an oral alternative to IV-administered medications, 
     but only if the Secretary determines such coverage does not 
     result, as estimated by the Secretary, in expenditures made 
     under this title during any 5-year period that are greater 
     than the expenditures that would have been made under this 
     title during such period if such coverage was not 
     provided.''.
       (2) Conforming amendment.--Section 1834(j)(5)(F)(iv) (42 
     U.S.C. 1395m(j)(5)(F)(iv)) is amended to read as follows:
       ``(iv) oral drugs described in section 1861(s)(2)(Q); 
     and''.
       (3) Effective date.--The amendments made by this subsection 
     shall apply only with respect to drugs furnished during the 
     period that begins on or after the date that is 90 days after 
     the date of the enactment of this Act and ends on January 1, 
     2006. After January 1, 2006, the Social Security Act shall be 
     applied and administered as if the amendments made by this 
     subsection had never been enacted.
       (b) Public Disclosure of Market-Based Drug Pricing 
     Information.--
       (1) In general.--Section 1927(b)(3)(D) (42 U.S.C. 1396r-
     8(b)(3)(D)) is amended to read as follows:
       ``(D) Public availability of information.--
       ``(i) Timely availability of information.--Notwithstanding 
     any other provision of law, with respect to a manufacturer 
     with an agreement in effect under this section, not later 
     than 30 days after the date the Secretary receives from such 
     manufacturer the information required to be reported under 
     this paragraph (or verifies such information with a 
     wholesaler), the Secretary shall make the information 
     described in clause (ii), including the identity of the 
     manufacturer to which the information applies, publicly 
     available through the Internet or other means of 
     communication.
       ``(ii) Information described.--The information described in 
     this clause is the following:

       ``(I) Average manufacturer's price.--The average 
     manufacturer price (as defined in subsection (k)(1)) for each 
     of the manufacturer's covered outpatient drugs.
       ``(II) Best price.--With respect to single source drugs and 
     innovator multiple source drugs, the manufacturer's best 
     price (as defined in subsection (c)(1)(C)) for each of the 
     manufacturer's covered outpatient drugs.
       ``(III) Base average manufacturer price and initial average 
     manufacturer price for newly marketed drugs used to determine 
     an additional rebate for single source and innovator multiple 
     source drugs.--The average manufacturer price described in 
     subparagraphs (A)(ii)(II) (without regard to the percentage 
     increase determined under that subparagraph) and (B) of 
     subsection (c)(2) for each dosage form and strength of a 
     single source drug or an innovator multiple source drug used 
     to determine, with respect to a rebate period, an additional 
     rebate for such dosage form and strength for such a drug.

       ``(iii) Nondisclosure of certain information.--
     Notwithstanding any other provision of law, information 
     disclosed by manufacturers (or verified with wholesalers) 
     under an agreement with the Secretary of Veterans Affairs 
     described in subsection (a)(6)(A) may not be disclosed 
     except--

       ``(I) as the Secretary determines to be necessary to carry 
     out this section;
       ``(II) to permit the Comptroller General to review the 
     information provided; or
       ``(III) to permit the Director of the Congressional Budget 
     Office to review the information provided.

       ``(iv) Rule of construction.--Nothing in this subparagraph 
     shall be construed as affecting any requirement applicable to 
     the Secretary of Veterans Affairs regarding the 
     confidentiality of information required to be disclosed to 
     the Secretary of Veterans Affairs by a manufacturer under 
     section 8126 of title 38, United States Code.''.
       (2) Effective date; implementation.--
       (A) Effective date.--The amendments made by paragraph (1) 
     take effect upon the date of enactment of this Act and apply 
     to the most recent reported price information under section 
     1927(b)(3) of the Social Security Act (42 U.S.C. 1396r-
     8(b)(3)) as of such date, and all such information reported 
     under such section after such date.
       (B) Additional period for implementation.--Notwithstanding 
     the 30-day requirement for the public availability of market-
     based drug pricing information under section 1927(b)(3)(D)(i) 
     of the Social Security Act (42 U.S.C. 1396r-8(b)(3)(D)(i)), 
     with respect to the initial public availability of such 
     information, the Secretary of Health and Human Services shall 
     have up to 90 days from the date of the enactment of this Act 
     in which to make such information so available.
       (3) Authorization of appropriations.--There are authorized 
     to be appropriated to carry out section 1927(b)(3)(D) of the 
     Social Security Act (42 U.S.C. 1396r-8(b)(3)(D)), as amended 
     by this subsection, such sums as may be necessary to carry 
     out such section. Amounts appropriated pursuant to this 
     subsection shall be in addition to amounts otherwise 
     appropriated to carry out title XIX of such Act (42 U.S.C. 
     1396 et seq.).
                                 ______
                                 
  SA 1073. Mr. SMITH (for himself, Mr. Feingold, and Ms. Cantwell) 
sumitted an amendment intended to be proposed by him to the bill S. 1, 
to amend title XVIII of the Social Security Act to make improvements in 
the medicare program, to provide prescription drug coverage under the 
medicare program, and for other purposes; as follows:

       On page 379, strike lines 9 through 13, and insert:
       ``(A) In General.--The term `specialized Medicare+Choice 
     plans for special needs beneficiaries' means a 
     Medicare+Choice plan that--
       ``(i) exclusively serves special needs beneficiaries (as 
     defined in subparagraph (B)), or
       ``(ii) to the extent provided in regulations prescribed by 
     the Secretary, disproportionately serves such special needs 
     beneficiaries, frail elderly medicare beneficiaries, or both.
                                 ______
                                 
  SA 1074. Mr. COLEMAN sumitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       At the end of subtitle C of title IV, add the following:

     SEC. __. IMPROVEMENTS IN NATIONAL COVERAGE DETERMINATION 
                   PROCESS TO RESPOND TO CHANGES IN TECHNOLOGY.

       (a) In General.--Section 1862 (42 U.S.C. 1395y) is 
     amended--
       (A) in the third sentence of subsection (a) by inserting 
     ``consistent with subsection (j)'' after ``the Secretary 
     shall ensure''; and
       (B) by adding at the end the following new subsection:

[[Page S8587]]

       ``(j) National Coverage Determination Process.--
       ``(1) Timeframe for decisions on requests for national 
     coverage determinations.--In the case of a request for a 
     national coverage determination that--
       ``(A) does not require a technology assessment from an 
     outside entity or deliberation from the Medicare Coverage 
     Advisory Committee, the decision on the request shall be made 
     not later than 6 months after the date of the request; or
       ``(B) requires such an assessment or deliberation and in 
     which a clinical trial is not requested, the decision on the 
     request shall be made not later than 9 months after the date 
     of the request.
       ``(2) Process for public comment in national coverage 
     determinations.--At the end of the 6-month period (with 
     respect to a request under paragraph (1)(A)) or 9-month 
     period (with respect to a request under paragraph (1)(B)) 
     that begins on the date a request for a national coverage 
     determination is made, the Secretary shall--
       ``(A) make a draft of proposed decision on the request 
     available to the public through the Medicare Internet site of 
     the Department of Health and Human Services or other 
     appropriate means;
       ``(B) provide a 30-day period for public comment on such 
     draft;
       ``(C) make a final decision on the request within 60 days 
     of the conclusion of the 30-day period referred to under 
     subparagraph (B);
       ``(D) include in such final decision summaries of the 
     public comments received and responses thereto;
       ``(E) make available to the public the clinical evidence 
     and other data used in making such a decision when the 
     decision differs from the recommendations of the Medicare 
     Coverage Advisory Committee; and
       ``(F) in the case of a decision to grant the coverage 
     determination, assign a temporary or permanent code and 
     implement the coverage decision at the end of the 60-day 
     period referred to in subparagraph (C).
       ``(3) National coverage determination defined.--For 
     purposes of this subsection, the term `national coverage 
     determination' has the meaning given such term in section 
     1869(f)(1)(B).''.
       (b) Effective date.--The amendments made by this section 
     shall apply to national coverage determinations as of January 
     1, 2004.
                                 ______
                                 
  SA 1075. Ms. STABENOW (for herself and Mr. Levin) proposed an 
amendment to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; as follows:

       On page 676, after line 22, add the following:

     SEC. __. EXTENSION OF MORATORIUM.

       (a) In General.--Section 6408(a)(3) of the Omnibus Budget 
     Reconciliation Act of 1989, as amended by section 13642 of 
     the Omnibus Budget Reconciliation Act of 1993 and section 
     4758 of the Balanced Budget Act of 1997, is amended--
       (1) by striking ``until December 31, 2002'', and
       (2) by striking ``Kent Community Hospital Complex in 
     Michigan or.''
       (b) Effective Dates.--
       (1) Permanent extension.--The amendment made by subsection 
     (a)(1) shall take effect as if included in the amendment made 
     by section 4758 of the Balanced Budget Act of 1997.
       (2) Modification.--The amendment made by subsection (a)(2) 
     shall take effect on the date of enactment of this Act.
                                 ______
                                 
  SA 1076. Ms. STABENOW (for herself and Mr. Levin) proposed an 
amendment to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; as follows:

       On page 438, between lines 10 and 11, insert the following:

     SEC. __. COMPREHENSIVE CANCER CENTERS.

       (a) In General.--Section 1886(d)(1) of the Social Security 
     Act (42 U.S.C. 1395ww(d)(1)) is amended--
       (1) in subparagraph (B)(v)--
       (A) by striking ``or'' at the end of subclause (III);
       (B) by striking the semicolon at the end of subclause (IV) 
     and inserting ``, or''; and
       (C) by inserting after subclause (IV) the following:

       ``(IV) a hospital that is a nonprofit corporation, the sole 
     member of which was recognized as a comprehensive cancer 
     center by the National Cancer Institute of the National 
     Institutes of Health as of April 20, 1983, that specifies in 
     its articles of incorporation that at least 50 percent of its 
     total discharges must have a principal finding of neoplastic 
     disease, as defined in subparagraph (E), and that is a 
     freestanding facility licensed for less than 131 acute care 
     beds;''; and

       (2) in subparagraph (E), by striking ``(II) and (III)'' and 
     inserting ``(II), (III), and (IV)''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to cost reporting periods beginning after the 
     date of enactment of this Act.
                                 ______
                                 
  SA 1077. Ms. STABENOW (for herself and Mr. Levin) proposed an 
amendment to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; as follows:

       On page 438, between lines 10 and 11, insert the following:

     SEC. __. REDISTRIBUTION OF UNUSED RESIDENT POSITIONS.

       (a) In General.--Section 1886(h)(4) (42 U.S.C. 
     1395ww(h)(4)) is amended--
       (1) in subparagraph (F)(i), by inserting ``subject to 
     subparagraph (I),'' after ``October 1, 1997,'';
       (2) in subparagraph (H)(i), by inserting ``and subject to 
     subparagraph (I),'' after ``subparagraphs (F) and (G),''; and
       (3) by adding at the end the following new subparagraph:
       ``(I) Redistribution of unused resident positions.--
       ``(i) Reduction in limit based on unused positions.--

       ``(I) In general.--If a hospital's resident level (as 
     defined in clause (iii)(I)) is less than the otherwise 
     applicable resident limit (as defined in clause (iii)(II)) 
     for each of the reference periods (as defined in subclause 
     (II)), effective for cost reporting periods beginning on or 
     after January 1, 2003, the otherwise applicable resident 
     limit shall be reduced by 75 percent of the difference 
     between such limit and the reference resident level specified 
     in subclause (III) (or subclause (IV) if applicable).
       ``(II) Reference periods defined.--In this clause, the term 
     `reference periods' means, for a hospital, the 3 most recent 
     consecutive cost reporting periods of the hospital for which 
     cost reports have been settled (or, if not, submitted) on or 
     before September 30, 2001.
       ``(III) Reference resident level.--Subject to subclause 
     (IV), the reference resident level specified in this 
     subclause for a hospital is the highest resident level for 
     the hospital during any of the reference periods.
       ``(IV) Adjustment process.--Upon the timely request of a 
     hospital, the Secretary may adjust the reference resident 
     level for a hospital to be the resident level for the 
     hospital for the cost reporting period that includes July 1, 
     2002.

       ``(ii) Redistribution.--

       ``(I) In general.--The Secretary is authorized to increase 
     the otherwise applicable resident limits for hospitals by an 
     aggregate number estimated by the Secretary that does not 
     exceed the aggregate reduction in such limits attributable to 
     clause (i) (without taking into account any adjustment under 
     subclause (IV) of such clause).
       ``(II) Effective date.--No increase under subclause (I) 
     shall be permitted or taken into account for a hospital for 
     any portion of a cost reporting period that occurs before 
     July 1, 2003, or before the date of the hospital's 
     application for an increase under this clause. No such 
     increase shall be permitted for a hospital unless the 
     hospital has applied to the Secretary for such increase by 
     December 31, 2004.
       ``(III) Considerations in redistribution.--In determining 
     for which hospitals the increase in the otherwise applicable 
     resident limit is provided under subclause (I), the Secretary 
     shall take into account the need for such an increase by 
     specialty and location involved, consistent with subclause 
     (IV).
       ``(IV) Priority for rural and small urban areas.--In 
     determining for which hospitals and residency training 
     programs an increase in the otherwise applicable resident 
     limit is provided under subclause (I), the Secretary shall 
     first distribute the increase to programs of hospitals 
     located in rural areas or in urban areas that are not large 
     urban areas (as defined for purposes of subsection (d)) on a 
     first-come-first-served basis (as determined by the 
     Secretary) based on a demonstration that the hospital will 
     fill the positions made available under this clause and not 
     to exceed an increase of 25 full-time equivalent positions 
     with respect to any hospital.
       ``(V) Application of locality adjusted national average per 
     resident amount.--With respect to additional residency 
     positions in a hospital attributable to the increase provided 
     under this clause, notwithstanding any other provision of 
     this subsection, the approved FTE resident amount is deemed 
     to be equal to the locality adjusted national average per 
     resident amount computed under subparagraph (E) for that 
     hospital.
       ``(VI) Construction.--Nothing in this clause shall be 
     construed as permitting the redistribution of reductions in 
     residency positions attributable to voluntary reduction 
     programs under paragraph (6) or as affecting the ability of a 
     hospital to establish new medical residency training programs 
     under subparagraph (H).

       ``(iii) Resident level and limit defined.--In this 
     subparagraph:

       ``(I) Resident level.--The term `resident level' means, 
     with respect to a hospital, the total number of full-time 
     equivalent residents, before the application of weighting 
     factors (as determined under this paragraph), in the fields 
     of allopathic and osteopathic medicine for the hospital.
       ``(II) Otherwise applicable resident limit.--The term 
     `otherwise applicable resident limit' means, with respect to 
     a hospital,

[[Page S8588]]

     the limit otherwise applicable under subparagraphs (F)(i) and 
     (H) on the resident level for the hospital determined without 
     regard to this subparagraph.''.

       (b) No Application of Increase to IME.--Section 
     1886(d)(5)(B)(v) (42 U.S.C. 1395ww(d)(5)(B)(v)) is amended by 
     adding at the end the following: ``The provisions of 
     subsection (h)(4)(I) (determined without regard to clause 
     (ii) thereof) shall apply with respect to the first sentence 
     of this clause in the same manner as such provisions apply 
     with respect to subparagraph (F) of such subsection.''.
       (c) Report on Extension of Applications Under 
     Redistribution Program.--Not later than July 1, 2004, the 
     Secretary of Health and Human Services shall submit to 
     Congress a report containing recommendations regarding 
     whether to extend the deadline for applications for an 
     increase in resident limits under section 
     1886(h)(4)(I)(i)(II) of the Social Security Act (as added by 
     subsection (a)).
                                 ______
                                 
  SA 1076. Mr. LEVIN submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       At the end of subtitle A of title IV, add the following:

     SEC. __. REVISION OF ALTERNATIVE GUIDELINES FOR GEOGRAPHIC 
                   RECLASSIFICATION OF CERTAIN DISPROPORTIONATELY 
                   LARGE HOSPITALS.

       Section 4409(b) of the Balanced Budget Act of 1997 (42 
     U.S.C. 1395ww note) is amended--
       (1) in paragraph (1)--
       (A) by inserting ``(A)'' after ``(1)'';
       (B) by adding ``or'' after the semicolon at the end; and
       (C) by adding at the end the following new subparagraph:
       ``(B) beginning with fiscal year 2003, the hospital is the 
     only hospital located in such an Area'';
       (2) in paragraph (2), by inserting ``in the case of a 
     hospital described in paragraph (1)(A),'' before ``not less 
     than 40 percent''; and
       (3) in paragraph (3), by inserting ``for fiscal years 
     before 2003,'' before ``the hospital submitted an 
     application''.
                                 ______
                                 
  SA 1079. Mr. LEVIN submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       At the end of subtitle A of title IV, add the following:

     SEC. __. RECLASSIFICATION OF CERTAIN RURAL COUNTIES FOR 
                   PURPOSES OF REIMBURSEMENT UNDER THE MEDICARE 
                   PROGRAM.

       (a) In General.--Notwithstanding any other provision of 
     law, effective for discharges occurring during fiscal years 
     2003, 2004, and 2005, for purposes of making payments under 
     section 1886(d) of the Social Security Act (42 U.S.C. 
     1395ww(d)), a hospital located in a rural county in a State 
     that is adjacent to 1 or more urban areas is deemed to be 
     located in the urban metropolitan statistical area from which 
     the greatest number of hospital employees commute, if--
       (1) the rural county is surrounded by urban metropolitan 
     statistical areas; and
       (2) the hospital would be reclassified as being located in 
     an adjacent urban metropolitan statistical area for purposes 
     of determining the wage index and the standardized amount 
     applicable to the hospital but for a requirement that the 
     hospital have a wage index that is 106 percent of its 
     applicable rural wage index.
       (b) Treatment as Decision of Medicare Geographic 
     Classification review Board.--For purposes of section 1886(d) 
     of the Social Security Act (42 U.S.C 1395ww(d)), any 
     reclassification under subsection (a) shall be treated as a 
     decision of the Medicare Geographic Classification Review 
     Board under paragraph (10) of that section.
       (c) Process for Applications To Ensure that Provisions 
     Apply Beginning October 1, 2003.--The Secretary of Health and 
     Human Services shall establish a process for the Medicare 
     Geographic Classification Review Board to accept, and make 
     determinations with respect to, applications that are filed 
     by applicable hospitals within 90 days of the date of 
     enactment of this section to reclassify based on the 
     provisions of this section in order to ensure that such 
     provisions shall apply to payments under such section 1886(d) 
     for discharges occurring on or after October 1, 2003.
       (d) Adjustments To Ensure Budget Neutrality.--If 1 or more 
     applicable hospital's applications are approved pursuant to 
     the process under subsection (c), the Secretary of Health and 
     Human Services shall make a proportional adjustment in the 
     standardized amounts determined under paragraph (3) of such 
     section 1886(d) for payments for discharges occurring in 
     fiscal year 2004 to ensure that approval of such applications 
     does not result in aggregate payments under such section 
     1886(d) that are greater or less than those that would 
     otherwise be made if this section had not been enacted.
                                 ______
                                 
  SA 1080. Mr. DeWINE (for himself and Mr. Durbin) submitted an 
amendment intended to be proposed by him to the bill S. 1, to amend 
title XVIII of the Social Security Act to make improvements to the 
medicare program, to provide prescription drug coverage under the 
medicare program, and for other purposes; which was ordered to lie on 
the table; as follows:

       At the end of title VI, insert the following:

     SEC. __. COMPREHENSIVE IMMUNOSUPPRESSIVE DRUG COVERAGE FOR 
                   TRANSPLANT PATIENTS.

       (a) Comprehensive Coverage of Immunosuppressive Drugs Under 
     the Medicare Program.--
       (1) In General.--Section 1861(s)(2)(J) (42 U.S.C. 
     1395x(s)(2)(J)) is amended by striking ``, to an individual 
     who receives'' and all that follows before the semicolon at 
     the end and inserting ``to an individual who has received an 
     organ transplant''.
       (2) Effective Date.--The amendment made by this subsection 
     shall apply to drugs furnished on or after the date of 
     enactment of this Act.
       (b) Provision of Appropriate Coverage of Immunosuppressive 
     Drugs under the Medicare Program for Organ Transplant 
     Recipients.--
       (1) Continued entitlement to immunosuppressive drugs.--
       (A) Kidney transplant recipients.--Section 226A(b)(2) (42 
     U.S.C. 426-1(b)(2)) is amended by inserting ``(except for 
     coverage of immunosuppressive drugs under section 
     1861(s)(2)(J))'' after ``shall end''.
       (B) Other transplant recipients.--The flush matter 
     following paragraph (2)(C)(ii)(II) of section 226(b) (42 
     U.S.C. 426(b)) is amended by striking ``of this subsection)'' 
     and inserting ``of this subsection and except for coverage of 
     immunosuppressive drugs under section 1861(s)(2)(J))''.
       (C) Application.--Section 1836 (42 U.S.C. 1395o) is 
     amended--
       (i) by striking ``Every individual who'' and inserting 
     ``(a) In General.--Every individual who''; and
       (ii) by adding at the end the following new subsection:
       ``(b) Special Rules Applicable to Individuals Only Eligible 
     for Coverage of Immunosuppressive Drugs.--
       ``(1) In general.--In the case of an individual whose 
     eligibility for benefits under this title has ended except 
     for the coverage of immunosuppressive drugs by reason of 
     section 226(b) or 226A(b)(2), the following rules shall 
     apply:
       ``(A) The individual shall be deemed to be enrolled under 
     this part for purposes of receiving coverage of such drugs.
       ``(B) The individual shall be responsible for the full 
     amount of the premium under section 1839 in order to receive 
     such coverage.
       ``(C) The provision of such drugs shall be subject to the 
     application of--
       ``(i) the deductible under section 1833(b); and
       ``(ii) the coinsurance amount applicable for such drugs (as 
     determined under this part).
       ``(D) If the individual is an inpatient of a hospital or 
     other entity, the individual is entitled to receive coverage 
     of such drugs under this part.
       ``(2) Establishment of procedures in order to implement 
     coverage.--The Secretary shall establish procedures for--
       ``(A) identifying beneficiaries that are entitled to 
     coverage of immunosuppressive drugs by reason of section 
     226(b) or 226A(b)(2); and
       ``(B) distinguishing such beneficiaries from beneficiaries 
     that are enrolled under this part for the complete package of 
     benefits under this part.''.
       (D) Technical amendment.--Subsection (c) of section 226A 
     (42 U.S.C. 426-1), as added by section 201(a)(3)(D)(ii) of 
     the Social Security Independence and Program Improvements Act 
     of 1994 (Public Law 103-296; 108 Stat. 1497), is redesignated 
     as subsection (d).
       (2) Extension of secondary payer requirements for esrd 
     beneficiaries.--Section 1862(b)(1)(C) (42 U.S.C. 
     1395y(b)(1)(C)) is amended by adding at the end the following 
     new sentence: ``With regard to immunosuppressive drugs 
     furnished on or after the date of enactment of the 
     Prescription Drug and Medicare Improvement Act of 2003, this 
     subparagraph shall be applied without regard to any time 
     limitation.''.
       (3) Effective date.--The amendments made by this subsection 
     shall apply to drugs furnished on or after the date of 
     enactment of this Act.
       (c) Plans Required to Maintain Coverage of 
     Immunosuppressive Drugs.--
       (1) Application to certain health insurance coverage.--
       (A) In general.--Subpart 2 of part A of title XXVII of the 
     Public Health Service Act (42 U.S.C. 300gg-4 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 2707. COVERAGE OF IMMUNOSUPPRESSIVE DRUGS.

       ``A group health plan (and a health insurance issuer 
     offering health insurance coverage in connection with a group 
     health plan) shall provide coverage of immunosuppressive 
     drugs that is at least as comprehensive as the coverage 
     provided by such plan or issuer on the day before the date of 
     enactment of the Prescription Drug and Medicare Improvement 
     Act of 2003, and such

[[Page S8589]]

     requirement shall be deemed to be incorporated into this 
     section.''.
       (B) Conforming amendment.--Section 2721(b)(2)(A) of the 
     Public Health Service Act (42 U.S.C. 300gg-21(b)(2)(A)) is 
     amended by inserting ``(other than section 2707)'' after 
     ``requirements of such subparts''.
       (2) Application to group health plans and group health 
     insurance coverage under the employee retirement income 
     security act of 1974.--
       (A) In general.--Subpart B of part 7 of subtitle B of title 
     I of the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1185 et seq.) is amended by adding at the end the 
     following new section:

     ``SEC. 714. COVERAGE OF IMMUNOSUPPRESSIVE DRUGS.

       ``A group health plan (and a health insurance issuer 
     offering health insurance coverage in connection with a group 
     health plan) shall provide coverage of immunosuppressive 
     drugs that is at least as comprehensive as the coverage 
     provided by such plan or issuer on the day before the date of 
     enactment of the Prescription Drug and Medicare Improvement 
     Act of 2003, and such requirement shall be deemed to be 
     incorporated into this section.''.
       (B) Conforming amendments.--
       (i) Section 732(a) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1185(a)) is amended by 
     striking ``section 711'' and inserting ``sections 711 and 
     714''.
       (ii) The table of contents in section 1 of the Employee 
     Retirement Income Security Act of 1974 is amended by 
     inserting after the item relating to section 713 the 
     following new item:

``Sec. 714. Coverage of immunosuppressive drugs.''.
       (3) Application to group health plans under the internal 
     revenue code of 1986.--Subchapter B of chapter 100 of the 
     Internal Revenue Code of 1986 is amended--
       (A) in the table of sections, by inserting after the item 
     relating to section 9812 the following new item:

``Sec. 9813. Coverage of immunosuppressive drugs.'';
     and
       (B) by inserting after section 9812 the following:

     ``SEC. 9813. COVERAGE OF IMMUNOSUPPRESSIVE DRUGS.

       ``A group health plan shall provide coverage of 
     immunosuppressive drugs that is at least as comprehensive as 
     the coverage provided by such plan on the day before the date 
     of enactment of the Prescription Drug and Medicare 
     Improvement Act of 2003, and such requirement shall be deemed 
     to be incorporated into this section.''.
       (4) Effective Date.--The amendments made by this subsection 
     shall apply to plan years beginning on or after January 1, 
     2004.
                                 ______
                                 
  SA 1081. Ms. LANDRIEU submitted an amendment intended to be proposed 
by her to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 476, between lines 5 and 6, insert the following:
       (10) Exemption for certain inhalation drugs and 
     biologicals.--Section 1842(o) (42 U.S.C. 1395u(o)), as 
     amended by subsection (a)(2) and paragraphs (4), (6) (7) and 
     (9), is amended by adding at the end the following new 
     paragraph:
       ``(10)(A) Notwithstanding the preceding provisions of this 
     subsection, in the case of existing inhalation drugs and 
     biologicals furnished on or after January 1, 2004, and before 
     January 1, 2011, the payment rate for such drugs and 
     biologicals shall be 95 percent of the average wholesale 
     price (as in effect on June 30, 2003).
       ``(B) During the period described in subparagraph (A), the 
     Secretary may not make any increased or separate payments 
     under paragraph (8) with respect to existing inhalation drugs 
     and biologicals.
       ``(C) For purposes of this paragraph, the term `existing 
     inhalation drugs and biologicals' means inhalation drugs and 
     biologicals furnished through durable medical equipment 
     covered under section 1861(n) that are first available for 
     payment under this part on or before June 30, 2003.''.
                                 ______
                                 
  SA 1082. Mr. CONRAD submitted an amendment intended to be proposed by 
him to the bill S. 1, to amend title XVIII of the Social Security Act 
to make improvements in the medicare program, to provide prescription 
drug coverage under the medicare program, and for other purposes; which 
was ordered to lie on the table; as follows:

       At the end of subtitle B of title IV, add the following:

     SEC. __. ACCELERATING THE RATE OF REDUCTION OF BENEFICIARY 
                   COPAYMENT LIABILITY UNDER THE MEDICARE HOSPITAL 
                   OUTPATIENT DEPARTMENT PROSPECTIVE PAYMENT 
                   SYSTEM.

       Section 1833(t)(8)(C)(ii) (42 U.S.C. 1395l(t)(8)(C)(ii)) is 
     amended--
       (1) in subclause (V), by striking ``and thereafter'' and 
     inserting ``through 2008''; and
       (2) by adding at the end the following new subclauses:

       ``(VI) For procedures performed in 2009, 36 percent.
       ``(VII) For procedures performed in 2010 and 2011, 34 
     percent.
       ``(VIII) For procedures performed in 2012, 32 percent.
       ``(IX) For procedures performed in 2013 and thereafter, 30 
     percent.''.

     SEC. __. MEDICARE SECONDARY PAYOR (MSP) PROVISIONS.

       (a) Technical Amendment Concerning Secretary's Authority To 
     Make Conditional Payment When Certain Primary Plans Do Not 
     Pay Promptly.--
       (1) In general.--Section 1862(b)(2) (42 U.S.C. 1395y(b)(2)) 
     is amended--
       (A) in subparagraph (A)(ii), by striking ``promptly (as 
     determined in accordance with regulations)'';
       (B) in subparagraph (B)--
       (i) by redesignating clauses (i) through (iii) as clauses 
     (ii) through (iv), respectively; and
       (ii) by inserting before clause (ii), as so redesignated, 
     the following new clause:
       ``(i) Authority to make conditional payment.--The Secretary 
     may make payment under this title with respect to an item or 
     service if a primary plan described in subparagraph (A)(ii) 
     has not made or cannot reasonably be expected to make payment 
     with respect to such item or service promptly (as determined 
     in accordance with regulations). Any such payment by the 
     Secretary shall be conditioned on reimbursement to the 
     appropriate Trust Fund in accordance with the succeeding 
     provisions of this subsection.''.
       (2) Effective date.--The amendments made by paragraph (1) 
     shall be effective as if included in the enactment of title 
     III of the Medicare and Medicaid Budget Reconciliation 
     Amendments of 1984 (Public Law 98-369).
       (b) Clarifying Amendments to Conditional Payment 
     Provisions.--Section 1862(b)(2) (42 U.S.C. 1395y(b)(2)) is 
     further amended--
       (1) in subparagraph (A), in the matter following clause 
     (ii), by inserting the following sentence at the end: ``An 
     entity that engages in a business, trade, or profession shall 
     be deemed to have a self-insured plan if it carries its own 
     risk (whether by a failure to obtain insurance, or otherwise) 
     in whole or in part.'';
       (2) in subparagraph (B)(ii), as redesignated by subsection 
     (a)(2)(B)--
       (A) by striking the first sentence and inserting the 
     following: ``A primary plan, and an entity that receives 
     payment from a primary plan, shall reimburse the appropriate 
     Trust Fund for any payment made by the Secretary under this 
     title with respect to an item or service if it is 
     demonstrated that such primary plan has or had a 
     responsibility to make payment with respect to such item or 
     service. A primary plan's responsibility for such payment may 
     be demonstrated by a judgment, a payment conditioned upon the 
     recipient's compromise, waiver, or release (whether or not 
     there is a determination or admission of liability) of 
     payment for items or services included in a claim against the 
     primary plan or the primary plan's insured, or by other 
     means.''; and
       (B) in the final sentence, by striking ``on the date such 
     notice or other information is received'' and inserting ``on 
     the date notice of, or information related to, a primary 
     plan's responsibility for such payment or other information 
     is received''; and
       (3) in subparagraph (B)(iii), , as redesignated by 
     subsection (a)(2)(B), by striking the first sentence and 
     inserting the following: ``In order to recover payment made 
     under this title for an item or service, the United States 
     may bring an action against any or all entities that are or 
     were required or responsible (directly, as an insurer or 
     self-insurer, as a third-party administrator, as an employer 
     that sponsors or contributes to a group health plan, or large 
     group health plan, or otherwise) to make payment with respect 
     to the same item or service (or any portion thereof) under a 
     primary plan. The United States may, in accordance with 
     paragraph (3)(A) collect double damages against any such 
     entity. In addition, the United States may recover under this 
     clause from any entity that has received payment from a 
     primary plan or from the proceeds of a primary plan's payment 
     to any entity.''.
       (c) Clerical Amendments.--Section 1862(b) (42 U.S.C. 
     1395y(b)) is amended--
       (1) in paragraph (1)(A), by moving the indentation of 
     clauses (ii) through (v) 2 ems to the left; and
       (2) in paragraph (3)(A), by striking ``such'' before 
     ``paragraphs''.
                                 ______
                                 
  SA 1083. Mr. COLEMAN submitted an amendment intended to be proposed 
by him to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the end of subtitle A of title IV, add the following:

     SEC. __. TREATMENT OF CERTAIN ENTITIES FOR PURPOSES OF 
                   PAYMENTS UNDER THE MEDICARE PROGRAM.

       (a) Payments to Hospitals.--Notwithstanding any other 
     provision of law, effective for discharges occurring on or 
     after October 1, 2003, for purposes of making payments to 
     hospitals (as defined in section 1886(d) and 1833(t) of the 
     Social Security Act (42 U.S.C.

[[Page S8590]]

     1395(d)) under the medicare program under title XVIII of such 
     Act (42 U.S.C. 1395 et seq.), Stearns County, Minnesota, such 
     county is deemed to be located in the Minneapolis-St. Paul, 
     Minnesota-Wisconsin, Metropolitan Statistical Area.
       (b) Budget Neutrality.--The Secretary shall adjust the area 
     wage index referred to in subsection (a) in a manner which 
     assures that the appropriate payments made under section 
     1886(d) of the Social Security Act (42 U.S.C., 1395(ww)(d)) 
     in a fiscal year for the operating cost of inpatient hospital 
     services are not greater or less than those which would have 
     be made in the year if this section did not apply.
                                 ______
                                 
  SA 1084. Mr. VOINOVICH submitted an amendment intended to be proposed 
by him to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 152, between lines 7 and 8, and insert the 
     following:
       ``(g) State Option To Pay Medicare Part D Price for Covered 
     Outpatient Drugs for Dual Eligible Individuals.--
     Notwithstanding any provision of title XVIII, or section 
     1927(c)(1)(C)(i), with respect to a State that provides 
     medical assistance for a covered drug (as such term is 
     defined in section 1860D(a)(2)) for a dual eligible 
     individual enrolled under the State plan under this title (or 
     under a waiver of such plan) that is also a covered 
     outpatient drug (as defined for purposes of in section 1927) 
     included on the State formulary established under section 
     1927, if the price the State would pay for the drug under 
     this title exceeds the price that an eligible entity offering 
     a Medicare Prescription Drug plan or a MedicareAdvantage 
     organization offering a MedicareAdvantage plan would pay for 
     the drug under title XVIII, the State may elect to pay the 
     price that applies under title XVIII. An election by a State 
     under the preceding sentence shall have no effect on the 
     terms of a rebate agreement entered into under section 1927 
     which would otherwise apply to the provision of medical 
     assistance for the covered outpatient drug.''.
                                 ______
                                 
  SA 1085. Mr. SPECTER submitted an amendment intended to be proposed 
by him to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the end of title VI, insert the following:

     SEC. __. SENSE OF THE SENATE ON PAYMENT REDUCTIONS UNDER 
                   MEDICARE PHYSICIAN FEE SCHEDULE.

       (a) Findings.--Congress finds that--
       (1) the fees Medicare pays physicians were reduced by 5.4 
     percent across-the-board in 2002;
       (2) recent action by Congress narrowly averted another 
     across-the-board reduction of 4.4 percent for 2003;
       (3) based on current projections, the Centers for Medicare 
     & Medicaid Services (CMS) estimates that, absent legislative 
     or administrative action, fees will be reduced across-the-
     board once again in 2004 by 4.2 percent;
       (4) the prospect of continued payment reductions under the 
     Medicare physician fee schedule for the foreseeable future 
     threatens to destabilize an important element of the program, 
     namely physician participation and willingness to accept 
     Medicare patients;
       (5) the primary source of this instability is the 
     sustainable growth rate (SGR), a system of annual spending 
     targets for physicians' services under Medicare;
       (6) the SGR system has a number of defects that result in 
     unrealistically low spending targets, such as the use of the 
     increase in the gross domestic product (GDP) as a proxy for 
     increases in the volume and intensity of services provided by 
     physicians, no tolerance for variance between growth in 
     Medicare beneficiary health care costs and our Nation's GDP, 
     and a requirement for immediate recoupment of the difference;
       (7) both administrative and legislative action are needed 
     to return stability to the physician payment system;
       (8) using the discretion given to it by Medicare law, CMS 
     has included expenditures for prescription drugs and 
     biologicals administered incident to physicians' services 
     under the annual spending targets without making appropriate 
     adjustments to the targets to reflect price increases in 
     these drugs and biologicals or the growing reliance on such 
     therapies in the treatment of Medicare patients;
       (9) between 1996 and 2002, annual Medicare spending on 
     these drugs grew from $1,800,000,000 to $6,200,000,000, or 
     from $55 per beneficiary to an estimated $187 per 
     beneficiary;
       (10) although physicians are responsible for prescribing 
     these drugs and biologicals, neither the price of the drugs 
     and biologicals, nor the standards of care that encourage 
     their use, are within the control of physicians; and
       (11) SGR target adjustments have not been made for cost 
     increases due to new coverage decisions and new rules and 
     regulations.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that--
       (1) the Center for Medicare & Medicaid Services (CMS) 
     should use its discretion to exclude drugs and biologicals 
     administered incident to physician services from the 
     sustainable growth rate (SGR) system;
       (2) CMS should use its discretion to make SGR target 
     adjustments for new coverage decisions and new rules and 
     regulations; and
       (3) in order to provide ample time for Congress to consider 
     more fundamental changes to the SGR system, the conferees on 
     the Prescription Drug and Medicare Improvement Act of 2003 
     should include in the conference agreement a provision to 
     establish a minimum percentage update in physician fees for 
     the next 2 years and should consider adding provisions that 
     would mitigate the swings in payment, such as establishing 
     multi-year adjustments to recoup the variance and creating 
     ``tolerance'' corridors for variations around the update 
     target trend.
                                 ______
                                 
  SA 1086. Ms. MURKOWSKI submitted an amendment intended to be proposed 
by her to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 37, strike lines 4 and 5 and insert ``reasonable 
     distances to pharmacy services in urban and rural areas and 
     access to pharmacy services of the Indian Health Service and 
     Indian tribes and tribal organizations.''.
       On page 165, strike lines 4 and 5 and insert ``into account 
     reasonable distances to pharmacy services in urban and rural 
     areas and access to pharmacy services of the Indian Health 
     Service and Indian tribes and tribal organizations.''.
                                 ______
                                 
  SA 1087. Mr. GRASSLEY (for Mr. Craig) proposed an amendment to the 
bill S. 1, to amend title XVIII of the Social Security Act to make 
improvements in the medicare program, to provide prescription drug 
coverage under the medicare program, and for other purposes; as 
follows:

       At the end of subtitle A of title II, add the following:

     SEC. __. ESTABLISHMENT OF MEDICAREADVANTAGE CONSUMER-DRIVEN 
                   HEALTH PLAN OPTION.

       (a) Program specifications.--Part C of title XVIII (42 
     U.S.C. 1395w-21 et seq.), amended by section 205, is amended 
     by inserting after section 1858A the following new section:


                  ``consumer-driven health plan option

       ``Sec. 1858B. (a) Establishment of Program.--
       ``(1) In general.--Beginning on January 1, 2006, there is 
     established a consumer-driven health plan program under which 
     consumer-driven health plans offered by consumer-driven 
     health plan sponsors are offered to MedicareAdvantage 
     eligible individuals in preferred provider regions.
       ``(2) Definitions.--
       ``(A) Consumer-driven health plan sponsor.--The term 
     `consumer-driven health plan sponsor' means an entity with a 
     contract under section 1857 that meets the requirements of 
     this section applicable with respect to consumer-driven 
     health plan sponsors.
       ``(B) Consumer-driven health plan.--The term `consumer-
     driven health plan' means a MedicareAdvantage plan that--
       ``(i) provides 100 percent coverage for preventive benefits 
     (as defined by the Secretary);
       ``(ii) includes a personal care account from which 
     enrollees must pay out-of-pocket costs until the deductible 
     is met; and
       ``(iii) has a high deductible (as determined by the 
     Secretary).
       ``(C) Preferred provider region.--The term `preferred 
     provider region' has the meaning given that term under 
     section 1858(a)(2)(C).
       ``(b) Eligibility, Election, and Enrollment; Benefits and 
     Beneficiary Protections.--
       ``(1) In general.--Except as provided in the succeeding 
     provisions of this subsection, the provisions of sections 
     1851 and 1852 that apply with respect to coordinated care 
     plans shall apply to consumer-driven health plans offered by 
     a consumer-driven health plan sponsor.
       ``(2) Service area.--The service area of a consumer-driven 
     health plan shall be a preferred provider region.
       ``(3) Availability.--Each preferred provider organization 
     plan must be offered to each MedicareAdvantage eligible 
     individual who resides in the service area of the plan.
       ``(4) Authority to prohibit risk selection.--The provisions 
     of section 1852(a)(6) shall apply to preferred provider 
     organization plans.
       ``(5) Assuring access to services in consumer-driven health 
     plans.--The requirements of section 1858(a)(5) shall apply to 
     consumer-driven health plans.
       ``(6) Personal care accounts.--
       ``(A) Establishment.--Each consumer-driven health plan 
     shall establish a personal care account on behalf of each 
     enrollee from which such enrollee shall be required to pay 
     out-of-pockets costs until the deductible described in 
     subsection (a)(2)(B)(iii) is met.
       ``(B) Rollover.--Subject to subparagraph (C), any amounts 
     remaining in a personal care account at the end of a year 
     shall be credited to such an account for the subsequent year.

[[Page S8591]]

       ``(C) Changes of election.--If, after electing a consumer-
     driven health plan, a beneficiary elects a plan under this 
     part that is not a consumer-driven health plan during a 
     subsequent year or elects to receive benefits under the 
     original medicare fee-for-service program option (whether or 
     not as a result of circumstances described in section 
     1851(e)(4)), any amounts remaining in the account as of the 
     date of such election shall be credited to the Federal 
     Hospital Insurance Trust Fund under section 1817 and the 
     Federal Supplementary Medical Insurance Trust Fund under 
     section 1841 in such proportion as the Secretary determines 
     is appropriate.
       ``(c) Payments to Consumer-Driven Health Plan Sponsors.--
       ``(1) Payments to organizations.--
       ``(A) Monthly payments.--
       ``(i) In general.--Under a contract under section 1857 and 
     subject to paragraph (5), subsections (e) and (i), and 
     section 1859(e)(4), the Secretary shall make, to each 
     consumer-driven health plan sponsor, with respect to coverage 
     of an individual for a month under this part in a preferred 
     provider region, separate monthly payments with respect to--

       ``(I) benefits under the original medicare fee-for-service 
     program under parts A and B in accordance with paragraph (4); 
     and
       ``(II) benefits under the voluntary prescription drug 
     program under part D in accordance with section 1858A and the 
     other provisions of this part.

       ``(ii) Special rule for end-stage renal disease.--The 
     Secretary shall establish separate rates of payment 
     applicable with respect to classes of individuals determined 
     to have end-stage renal disease and enrolled in a consumer-
     driven health plan under this clause that are similar to the 
     separate rates of payment described in section 1853(a)(1)(B).
       ``(B) Adjustment to reflect number of enrollees.--The 
     Secretary may retroactively adjust the amount of payment 
     under this paragraph in a manner that is similar to the 
     manner in which payment amounts may be retroactively adjusted 
     under section 1853(a)(2).
       ``(C) Comprehensive risk adjustment methodology.--The 
     Secretary shall apply the comprehensive risk adjustment 
     methodology described in section 1853(a)(3)(B) to 100 percent 
     of the amount of payments to plans under paragraph 
     (4)(D)(ii).
       ``(D) Adjustment for spending variations within a region.--
     The Secretary shall establish a methodology for adjusting the 
     amount of payments to plans under paragraph (4)(D)(ii) that 
     achieves the same objective as the adjustment described in 
     paragraph 1853(a)(2)(C).
       ``(2) Application of preferred provider benchmarks.--The 
     benchmark amounts calculated under section 1858(c)(2) shall 
     apply with respect to consumer-driven health plans.
       ``(3) Application of preferred provider payment factors.--
     The provisions of section 1858(c)(3) shall apply with respect 
     to consumer driven health plans.
       ``(4) Secretary's determination of payment amount for 
     benefits under the original medicare fee-for-service 
     program.--The Secretary shall determine the payment amount 
     for plans as follows:
       ``(A) Review of plan bids.--The Secretary shall review each 
     plan bid submitted under subsection (d)(1) for the coverage 
     of benefits under the original medicare fee-for-service 
     program option to ensure that such bids are consistent with 
     the requirements under this part and are based on the 
     assumptions described in section 1854(a)(2)(A)(iii).
       ``(B) Determination of preferred provider regional 
     benchmark amounts.--The preferred provider regional benchmark 
     calculated under section 1858(c)(4)(B) shall apply with 
     respect to consumer-drive health plans amount for that plan 
     for the benefits under the original medicare fee-for-service 
     program option for each plan equal to the regional benchmark 
     adjusted by using the assumptions described in section 
     1854(a)(2)(A)(iii).
       ``(C) Comparison to benchmark.--The Secretary shall 
     determine the difference between each plan bid (as adjusted 
     under subparagraph (A)) and the preferred provider regional 
     benchmark amount (as determined under subparagraph (B)) for 
     purposes of determining--
       ``(i) the payment amount under subparagraph (D); and
       ``(ii) the additional benefits required and 
     MedicareAdvantage monthly basic beneficiary premiums.
       ``(D) Determination of payment amount.--
       ``(i) In general.--Subject to clause (ii), the Secretary 
     shall determine the payment amount to a consumer-driven 
     health plan sponsor for a consumer-driven health plan as 
     follows:

       ``(I) Bids that equal or exceed the benchmark.--In the case 
     of a plan bid that equals or exceeds the preferred provider 
     regional benchmark amount, the amount of each monthly payment 
     to the organization with respect to each individual enrolled 
     in a plan shall be the preferred provider regional benchmark 
     amount.
       ``(II) Bids below the benchmark.--In the case of a plan bid 
     that is less than the preferred provider regional benchmark 
     amount, the amount of each monthly payment to the 
     organization with respect to each individual enrolled in a 
     plan shall be the preferred provider regional benchmark 
     amount reduced by the amount of any premium reduction elected 
     by the plan under section 1854(d)(1)(A)(i).

       ``(ii) Application of adjustment methodologies.--The 
     Secretary shall adjust the amounts determined under 
     subparagraph (A) using the factors described in section 
     1858(c)(3)(A)(ii).
       ``(E) Factors used in adjusting bids and benchmarks for 
     consumer-driven health plan sponsors and in determining 
     enrollee premiums.--Subject to subparagraph (F), in addition 
     to the factors used to adjust payments to plans described in 
     section 1853(d)(6), the Secretary shall use the adjustment 
     for geographic variation within the region established under 
     paragraph (1)(D).
       ``(F) Adjustment for national coverage determinations and 
     legislative changes in benefits.--The Secretary shall provide 
     for adjustments for national coverage determinations and 
     legislative changes in benefits applicable with respect to 
     consumer-driven health plan sponsors in the same manner as 
     the Secretary provides for adjustments under section 
     1853(d)(7).
       ``(5) Payments from trust fund.--The payment to a consumer-
     driven health plan sponsor under this section shall be made 
     from the Federal Hospital Insurance Trust Fund and the 
     Federal Supplementary Medical Insurance Trust Fund in a 
     manner similar to the manner described in section 1853(g).
       ``(6) Special rule for certain inpatient hospital stays.--
     Rules similar to the rules applicable under section 1853(h) 
     shall apply with respect consumer-driven health plan 
     sponsors.
       ``(7) Special rule for hospice care.--Rules similar to the 
     rules applicable under section 1853(i) shall apply with 
     respect to consumer-driven health plan sponsors.
       ``(d) Submission of Bids by Consumer-Driven Health Plans; 
     Premiums.--
       ``(1) Submission of bids by consumer-driven health plan 
     sponsors.--
       ``(A) In general.--For the requirements on submissions by 
     consumer-driven health plans, see section 1854(a)(1).
       ``(B) Uniform premiums.--Each bid amount submitted under 
     subparagraph (A) for a consumer-driven health plan in a 
     preferred provider region may not vary among 
     MedicareAdvantage eligible individuals residing in such 
     preferred provider region.
       ``(C) Application of fehbp standard; prohibition on price 
     gouging.--Each bid amount submitted under subparagraph (A) 
     for a consumer-driven health plan must reasonably and 
     equitably reflect the cost of benefits provided under that 
     plan.
       ``(D) Review.--The Secretary shall review the adjusted 
     community rates (as defined in section 1854(g)(3)), the 
     amounts of the MedicareAdvantage monthly basic premium and 
     the MedicareAdvantage monthly beneficiary premium for 
     enhanced medical benefits filed under this paragraph and 
     shall approve or disapprove such rates and amounts so 
     submitted. The Secretary shall review the actuarial 
     assumptions and data used by the consumer-driven health plan 
     sponsor with respect to such rates and amounts so submitted 
     to determine the appropriateness of such assumptions and 
     data.
       ``(E) No limit on number of plans in a region.--The 
     Secretary may not limit the number of consumer-driven health 
     plans offered in a preferred provider region.
       ``(2) Monthly premiums charged.--The amount of the monthly 
     premium charged to an individual enrolled in a consumer-
     driven health plan offered by a consumer-driven health plan 
     sponsor shall be equal to the sum of the following:
       ``(A) The MedicareAdvantage monthly basic beneficiary 
     premium, as defined in section 1854(b)(2)(A) (if any).
       ``(B) The MedicareAdvantage monthly beneficiary premium for 
     enhanced medical benefits, as defined in section 
     1854(b)(2)(C) (if any).
       ``(C) The MedicareAdvantage monthly obligation for 
     qualified prescription drug coverage, as defined in section 
     1854(b)(2)(B) (if any).
       ``(3) Determination of premium reductions, reduced cost-
     sharing, additional benefits, and beneficiary premiums.--The 
     rules for determining premium reductions, reduced cost-
     sharing, additional benefits, and beneficiary premiums under 
     section 1854(d) shall apply with respect to consumer-driven 
     health plan sponsors.
       ``(4) Prohibition of segmenting preferred provider 
     regions.--The Secretary may not permit a consumer-driven 
     health plan sponsor to elect to apply the provisions of this 
     section uniformly to separate segments of a preferred 
     provider region (rather than uniformly to an entire preferred 
     provider region).
       ``(e) Portion of Total Payments to an Organization Subject 
     to Risk for 2 Years.--
       ``(1) Notification of spending under the plan.--
       ``(A) In general.--For 2007 and 2008, the consumer-driven 
     health plan sponsor offering a consumer-driven health plan 
     shall notify the Secretary of the total amount of costs that 
     the organization incurred in providing benefits covered under 
     parts A and B of the original medicare fee-for-service 
     program for all enrollees under the plan in the previous 
     year.
       ``(B) Certain expenses not included.--The total amount of 
     costs specified in subparagraph (A) may not include--
       ``(i) subject to subparagraph (C), administrative expenses 
     incurred in providing the benefits described in such 
     subparagraph; or

[[Page S8592]]

       ``(ii) amounts expended on providing enhanced medical 
     benefits under section 1852(a)(3)(D).
       ``(C) Establishment of allowable administrative expenses.--
     For purposes of applying subparagraph (B)(i), the 
     administrative expenses incurred in providing benefits 
     described in subparagraph (A) under a consumer-driven health 
     plan may not exceed an amount determined appropriate by the 
     Administrator.
       ``(2) Adjustment of payment.--
       ``(A) No adjustment if costs within risk corridor.--If the 
     total amount of costs specified in paragraph (1)(A) for the 
     plan for the year are not more than the first threshold upper 
     limit of the risk corridor (specified in paragraph 
     (3)(A)(iii)) and are not less than the first threshold lower 
     limit of the risk corridor (specified in paragraph (3)(A)(i)) 
     for the plan for the year, then no additional payments shall 
     be made by the Secretary and no reduced payments shall be 
     made to the consumer-driven health plan sponsor offering the 
     plan.
       ``(B) Increase in payment if costs above upper limit of 
     risk corridor.--
       ``(i) In general.--If the total amount of costs specified 
     in paragraph (1)(A) for the plan for the year are more than 
     the first threshold upper limit of the risk corridor for the 
     plan for the year, then the Secretary shall increase the 
     total of the monthly payments made to the consumer-driven 
     health plan sponsor offering the plan for the year under 
     subsection (c)(1)(A) by an amount equal to the sum of--

       ``(I) 50 percent of the amount of such total costs which 
     are more than such first threshold upper limit of the risk 
     corridor and not more than the second threshold upper limit 
     of the risk corridor for the plan for the year (as specified 
     under paragraph (3)(A)(iv)); and
       ``(II) 10 percent of the amount of such total costs which 
     are more than such second threshold upper limit of the risk 
     corridor.

       ``(C) Reduction in payment if costs below lower limit of 
     risk corridor.--If the total amount of costs specified in 
     paragraph (1)(A) for the plan for the year are less than the 
     first threshold lower limit of the risk corridor for the plan 
     for the year, then the Secretary shall reduce the total of 
     the monthly payments made to the consumer-driven health plan 
     sponsor offering the plan for the year under subsection 
     (c)(1)(A) by an amount (or otherwise recover from the plan an 
     amount) equal to--
       ``(i) 50 percent of the amount of such total costs which 
     are less than such first threshold lower limit of the risk 
     corridor and not less than the second threshold lower limit 
     of the risk corridor for the plan for the year (as specified 
     under paragraph (3)(A)(ii)); and
       ``(ii) 10 percent of the amount of such total costs which 
     are less than such second threshold lower limit of the risk 
     corridor.
       ``(3) Establishment of risk corridors.--
       ``(A) In general.--For 2006 and 2007, the Secretary shall 
     establish a risk corridor for each consumer-driven health 
     plan. The risk corridor for a plan for a year shall be equal 
     to a range as follows:
       ``(i) First threshold lower limit.--The first threshold 
     lower limit of such corridor shall be equal to--

       ``(I) the target amount described in subparagraph (B) for 
     the plan; minus
       ``(II) an amount equal to 5 percent of such target amount.

       ``(ii) Second threshold lower limit.--The second threshold 
     lower limit of such corridor shall be equal to--

       ``(I) the target amount described in subparagraph (B) for 
     the plan; minus
       ``(II) an amount equal to 10 percent of such target amount.

       ``(iii) First threshold upper limit.--The first threshold 
     upper limit of such corridor shall be equal to the sum of--

       ``(I) such target amount; and
       ``(II) the amount described in clause (i)(II).

       ``(iv) Second threshold upper limit.--The second threshold 
     upper limit of such corridor shall be equal to the sum of--

       ``(I) such target amount; and
       ``(II) the amount described in clause (ii)(II).

       ``(B) Target amount described.--The target amount described 
     in this paragraph is, with respect to a consumer-driven 
     health plan offered by a consumer-driven health plan sponsor 
     in a year, an amount equal to the sum of--
       ``(i) the total monthly payments made to the organization 
     for enrollees in the plan for the year under subsection 
     (c)(1)(A); and
       ``(ii) the total MedicareAdvantage basic beneficiary 
     premiums collected for such enrollees for the year under 
     subsection (d)(2)(A).
       ``(4) Plans at risk for entire amount of enhanced medical 
     benefits.--A consumer-driven health plan sponsor that offers 
     a consumer-driven health plan that provides enhanced medial 
     benefits under section 1852(a)(3)(D) shall be at full 
     financial risk for the provision of such benefits.
       ``(5) No effect on eligible beneficiaries.--No change in 
     payments made by reason of this subsection shall affect the 
     amount of the MedicareAdvantage basic beneficiary premium 
     that a beneficiary is otherwise required to pay under the 
     plan for the year under subsection (d)(2)(A).
       ``(6) Disclosure of information.--The provisions of section 
     1860D-16(b)(7), including subparagraph (B) of such section, 
     shall apply to a consumer-driven health plan sponsor and a 
     consumer-driven health plan in the same manner as such 
     provisions apply to an eligible entity and a Medicare 
     Prescription Drug plan under part D.
       ``(f) Organizational and Financial Requirements for 
     Consumer-Driven Health Plan Sponsors.--A consumer-driven 
     health plan sponsor shall be organized and licensed under 
     State law as a risk-bearing entity eligible to offer health 
     insurance or health benefits coverage in each State within 
     the preferred provider region in which it offers a consumer-
     driven health plan.
       ``(g) Inapplicability of Provider-Sponsored Organization 
     Solvency Standards.--The requirements of section 1856 shall 
     not apply with respect to consumer-driven health plan 
     sponsors.
       ``(h) Contracts With Consumer-Driven Health Plan 
     Sponsors.--The provisions of section 1857 shall apply to a 
     consumer-driven health plan offered by a consumer-driven 
     health plan sponsor under this section.
       ``(i) Budget Neutrality.--Notwithstanding any other 
     provision of this section, in conducting the program under 
     this section, the Secretary shall ensure that the aggregate 
     payments made by the Secretary under this title do not exceed 
     the amount the Secretary would have paid if this section had 
     not been enacted.''.
       (b) Consumer-Driven Health Plan Terminology Defined.--
     Section 1859(a) (42 U.S.C. 1395w-29(a)), as amended by 
     section 211(b), is amended by adding at the end the following 
     new paragraph:
       ``(4) Consumer-driven health plan sponsor; consumer-driven 
     health plan.--The terms `consumer-driven health plan sponsor' 
     and `consumer-driven health plan' have the meaning given such 
     terms in section 1858B(a)(2).''.
                                 ______
                                 
  SA 1088. Mr. BAUCUS (for Ms. Mikulski) proposed an amendment to the 
bill S. 1, to amend title XVIII of the Social Security Act to make 
improvements in the medicare program, to provide prescription drug 
coverage under the medicare program, and for other purposes; as 
follows:

       At the end of subtitle B of title IV, add the following:

     SEC. __. EQUITABLE TREATMENT FOR CHILDREN'S HOSPITALS.

       (a) In General.--Section 1833(t)(7)(D)(ii) (42 U.S.C. 
     1395l(t)(7)(D)(ii)) is amended to read as follows:
       ``(ii) Permanent treatment for cancer hospitals and 
     children's hospitals.--

       ``(I) Cancer hospitals.--In the case of a hospital 
     described in section 1886(d)(1)(B)(v), for covered OPD 
     services for which the PPS amount is less than the pre-BBA 
     amount, the amount of payment under this subsection shall be 
     increased by the amount of such difference.
       ``(II) Children's hospitals.--In the case of a hospital 
     described in section 1886(d)(1)(B)(iii), for covered OPD 
     services furnished before October 1, 2003, and for which the 
     PPS amount is less than the pre-BBA amount the amount of 
     payment under this subsection shall be increased by the 
     amount of such difference. In the case of such a hospital, 
     for such services furnished on or after October 1, 2003, and 
     for which the PPS amount is less than the greater of the pre-
     BBA amount or the reasonable operating and capital costs 
     without reductions incurred in furnishing such services, the 
     amount of payment under this subsection shall be increased by 
     the amount of such difference.''.

                                 ______
                                 
  SA 1089. Mr. BAUCUS (for Ms. Mikulski) proposed an amendment to the 
bill S. 1, to amend title XVIII of the Social Security Act to make 
improvements in the medicare program, to provide prescription drug 
coverage under the medicare program, and for other purposes; as 
follows:

       At the end of subtitle B of title IV, add the following:

     SEC. __. EQUITABLE TREATMENT FOR CHILDREN'S HOSPITALS.

       (a) In General.--Section 1833(t)(7)(D)(ii) (42 U.S.C. 
     1395l(t)(7)(D)(ii)) is amended to read as follows:
       ``(ii) Permanent treatment for cancer hospitals and 
     children's hospitals.--

       ``(I) In general.--Subject to subclause (II), in the case 
     of a hospital described in clause (iii) or (v) of section 
     1886(d)(1)(B), for covered OPD services for which the PPS 
     amount is less than the pre-BBA amount, the amount of payment 
     under this subsection shall be increased by the amount of 
     such difference.
       ``(II) Special rule for certain children's hospitals.--In 
     the case of a hospital described in section 
     1886(d)(1)(B)(iii) that is located in a State with a 
     reimbursement system under section 1814(b)(3), but that is 
     not reimbursed under such system, for covered OPD services 
     furnished on or after October 1, 2003, and for which the PPS 
     amount is less than the greater of the pre-BBA amount or the 
     reasonable operating and capital costs without reductions of 
     the hospital in providing such services, the amount of 
     payment under this subsection shall be increased by the 
     amount of such difference.''.

                                 ______
                                 
  SA 1090. Mr. BAUCUS (for Ms. Mikulski) proposed an amendment to the 
bill S. 1, to amend title XVIII of the Social Security Act to make 
improvements in the medicare program, to provide prescription drug 
coverage under the medicare program, and for other purposes; as 
follows:


[[Page S8593]]


       At the end of subtitle A of title IV, add the following:

     SEC. __. PERMITTING DIRECT PAYMENT UNDER THE MEDICARE PROGRAM 
                   FOR CLINICAL SOCIAL WORKER SERVICES PROVIDED TO 
                   RESIDENTS OF SKILLED NURSING FACILITIES.

       (a) In General.--Section 1888(e)(2)(A)(ii) (42 U.S.C. 
     1395yy(e)(2)(A)(ii)) is amended by inserting ``clinical 
     social worker services,'' after ``qualified psychologist 
     services,''.
       (b) Conforming Amendment.--Section 1861(hh)(2) (42 U.S.C. 
     1395x(hh)(2)) is amended by striking ``and other than 
     services furnished to an inpatient of a skilled nursing 
     facility which the facility is required to provide as a 
     requirement for participation''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to items and services furnished on or after 
     October 1, 2003.
                                 ______
                                 
  SA 1091. Mr. BAUCUS (for Ms. Mikulski) proposed an amendment to the 
bill S. 1, to amend title XVIII of the Social Security Act to make 
improvements in the medicare program, to provide prescription drug 
coverage under the medicare program, and for other purposes; as 
follows:

       At the end of title VI, add the following:

     SEC. __. EXTENSION OF MUNICIPAL HEALTH SERVICE DEMONSTRATION 
                   PROJECTS.

       The last sentence of section 9215(a) of the Consolidated 
     Omnibus Budget Reconciliation Act of 1985 (42 U.S.C. 1395b-1 
     note), as previously amended, is amended by striking 
     ``December 31, 2004, but only with respect to'' and all that 
     follows and inserting ``December 31, 2009, but only with 
     respect to individuals who reside in the city in which the 
     project is operated and so long as the total number of 
     individuals participating in the project does not exceed the 
     number of such individuals participating as of January 1, 
     1996.''.
                                 ______
                                 
  SA 1092. Mr. GRASSLEY (for himself and Mr. Baucus) proposed an 
amendment to the bill S. 1, to amend title XVIII of the Social Security 
Act to make improvements in the medicare program, to provide 
prescription drug coverage under the medicare program, and for other 
purposes; as follows:

       At the end of subtitle C of title II, add the following:

   Subtitle D--Evaluation of Alternative Payment and Delivery Systems

     SEC. 231. ESTABLISHMENT OF ALTERNATIVE PAYMENT SYSTEM FOR 
                   PREFERRED PROVIDER ORGANIZATIONS IN HIGHLY 
                   COMPETITIVE REGIONS.

       (a) Establishment of Alternative Payment System for 
     Preferred Provider Organizations in Highly Competitive 
     Regions.--Section 1858 (as added by section 211(b)) is 
     amended by adding at the end the following new subsection:
       ``(i) Alternative Payment Methodology for Highly 
     Competitive Regions.--
       ``(1) Annual determination and designation.--
       ``(A) In 2008.--In 2008, prior to the date on which the 
     Secretary expects to publish the risk adjusters under section 
     1860D-11, the Secretary shall designate a limited number (but 
     in no case fewer than 1) of preferred provider regions (other 
     than the region described in subsection (a)(2)(C)(ii)) as 
     highly competitive regions.
       ``(B) Subsequent years.--For each year (beginning with 
     2009) the Secretary may designate a limited number of 
     preferred provider regions (other than the region described 
     in subsection (a)(2)(C)(ii)) as highly competitive regions in 
     addition to any region designated as a highly competitive 
     region under subparagraph (A).
       ``(C) Considerations.--In determining which preferred 
     provider regions to designate as highly competitive regions 
     under subparagraph (A) or (B), the Secretary shall consider 
     the following:
       ``(i) Whether the application of this subsection to the 
     preferred provider region would enhance the participation of 
     preferred provider organization plans in that region.
       ``(ii) Whether the Secretary anticipates that there is 
     likely to be at least 3 bids submitted under subsection 
     (d)(1) with respect to the preferred provider region if the 
     Secretary designates such region as a highly competitive 
     region under subparagraph (A) or (B).
       ``(iii) Whether the Secretary expects that 
     MedicareAdvantage eligible individuals will elect preferred 
     provider organization plans in the preferred provider region 
     if the region is designated as a highly competitive region 
     under subparagraph (A) or (B).
       ``(iv) Whether the designation of the preferred provider 
     region as a highly competitive region will permit compliance 
     with the limitation described in paragraph (5).

     In considering the matters described in clauses (i) through 
     (iv), the Secretary shall give special consideration to 
     preferred provider regions where no bids were submitted under 
     subsection (d)(1) for the previous year.
       ``(2) Effect of designation.--If a preferred provider 
     region is designated as a highly competitive region under 
     subparagraph (A) or (B) of paragraph (1)--
       ``(A) the provisions of this subsection shall apply to such 
     region and shall supersede the provisions of this part 
     relating to benchmarks for preferred provider regions; and
       ``(B) such region shall continue to be a highly competitive 
     region until such designation is rescinded pursuant to 
     paragraph (5)(B)(ii).
       ``(3) Submission of bids.--
       ``(A) In general.--Notwithstanding subsection (d)(1), for 
     purposes of applying section 1854(a)(2)(A)(i), the plan bid 
     for a highly competitive region shall consist of a dollar 
     amount that represents the total amount that the plan is 
     willing to accept (not taking into account the application of 
     the comprehensive risk adjustment methodology under section 
     1853(a)(3)) for providing coverage of only the benefits 
     described in section 1852(a)(1)(A) to an individual enrolled 
     in the plan that resides in the service area of the plan for 
     a month.
       ``(B) Construction.--Nothing in subparagraph (A) shall be 
     construed as permitting a preferred provider organization 
     plan not to provide coverage for the benefits described in 
     section 1852(a)(1)(C).
       ``(4) Payments to preferred provider organizations in 
     highly competitive areas.--With respect to highly competitive 
     regions, the following rules shall apply:
       ``(A) In general.--Notwithstanding subsection (c), of the 
     plans described in subsection (d)(1)(E), the Secretary shall 
     substitute the second lowest bid for the benchmark applicable 
     under subsection (c)(4).
       ``(B) If there are fewer than three bids.--Notwithstanding 
     subsection (c), if there are fewer than 3 bids in a highly 
     competitive region for a year, the Secretary shall substitute 
     the lowest bid for the benchmark applicable under subsection 
     (c)(4).
       ``(5) Funding limitation.--
       ``(A) In general.--
       ``(i) In general.--The total amount expended as a result of 
     the application of this subsection during the period or year, 
     as applicable, may not exceed the applicable amount (as 
     defined in clause (ii)).
       ``(ii) Applicable amount defined.--In this paragraph, the 
     term `applicable amount' means--

       ``(I) for the period beginning on January 1, 2009, and 
     ending on September 30, 2013, the total amount that would 
     have been expended under this title during the period if this 
     subsection had not been enacted plus $6,000,000,000; and
       ``(II) for fiscal year 2014 and any subsequent fiscal year, 
     the total amount that would have been expended under this 
     title during the year if this subsection had not been 
     enacted.

       ``(B) Application of limitation.--If the Secretary 
     determines that the application of this subsection will cause 
     expenditures to exceed the applicable amount, the Secretary 
     shall--
       ``(i) take appropriate steps to stay within the applicable 
     amount, including through providing limitations on 
     enrollment; or
       ``(ii) rescind the designation under subparagraph (A) or 
     (B) of paragraph (1) of 1 or more preferred provider regions 
     as highly competitive regions.
       ``(C) Transition.--If the Secretary rescinds a designation 
     under subparagraph (A) or (B) of paragraph (1) pursuant to 
     subparagraph (B)(ii) with respect to a preferred provider 
     region, the Secretary shall provide for an appropriate 
     transition from the payment system applicable under this 
     subsection to the payment system described in the other 
     provisions of this section in that region. Any amount 
     expended by reason of the preceding sentence shall be 
     considered to be part of the total amount expended as a 
     result of the application of this subsection for purposes of 
     applying the limitation under subparagraph (A).
       ``(D) Application.--Notwithstanding paragraph (1)(B), on or 
     after January 1 of the year in which the fiscal year 
     described in subparagraph (A)(ii)(II) begins, the Secretary 
     may designate appropriate regions under such paragraph.
       ``(6) Limitation of judicial review.--There shall be no 
     administrative or judicial review under section 1869, section 
     1878, or otherwise, of designations made under subparagraph 
     (A) or (B) of paragraph (1).
       ``(7) Secretary reports.--Not later than April 1 of each 
     year (beginning in 2010), the Secretary shall submit a report 
     to Congress and the Comptroller General of the United States 
     that includes--
       ``(A) a detailed description of--
       ``(i) the total amount expended as a result of the 
     application of this subsection in the previous year compared 
     to the total amount that would have been expended under this 
     title in the year if this subsection had not been enacted;
       ``(ii) the projections of the total amount that will be 
     expended as a result of the application of this subsection in 
     the year in which the report is submitted compared to the 
     total amount that would have been expended under this title 
     in the year if this subsection had not been enacted;
       ``(iii) amounts remaining within the funding limitation 
     specified in paragraph (5); and
       ``(iv) the steps that the Secretary will take under clauses 
     (i) and (ii) of paragraph (5)(B) to ensure that the 
     application of this subsection will not cause expenditures to 
     exceed the applicable amount described in paragraph (5)(A); 
     and
       ``(B) a certification from the Chief Actuary of the Centers 
     for Medicare & Medicaid Services that the descriptions under 
     clauses (i), (ii), (iii), and (iv) of subparagraph (A) are 
     reasonable, accurate, and based on generally accepted 
     actuarial principles and methodologies.

[[Page S8594]]

       ``(8) Biennial gao reports.--Not later than January 1, 
     2011, and biennially thereafter, the Comptroller General of 
     the United States shall submit to the Secretary and Congress 
     a report on the designation of highly competitive regions 
     under this subsection and the application of the payment 
     system under this subsection within such regions. Each report 
     shall include--
       ``(A) an evaluation of--
       ``(i) the quality of care provided to beneficiaries 
     enrolled in a MedicareAdvantage preferred provider plan in a 
     highly competitive region;
       ``(ii) the satisfaction of beneficiaries with benefits 
     under such a plan;
       ``(iii) the costs to the medicare program for payments made 
     to such plans; and
       ``(iv) any improvements in the delivery of health care 
     services under such a plan;
       ``(B) a comparative analysis of the benchmark system 
     applicable under the other provisions of this section and the 
     payment system applicable in highly competitive regions under 
     this subsection; and
       ``(C) recommendations for such legislation or 
     administrative action as the Comptroller General determines 
     to be appropriate.''.
       (b) Conforming Amendment.--Section 1858(c)(3)(A)(i) (as 
     added by section 211(b)) is amended to read as follows:
       ``(i) Whether each preferred provider region has been 
     designated as a highly competitive region under subparagraph 
     (A) or (B) of subsection (i)(1) and the benchmark amount for 
     any preferred provider region (as calculated under paragraph 
     (2)(A)) for the year that has not been designated as a highly 
     competitive region.''.

     SEC. 232. FEE-FOR-SERVICE MODERNIZATION PROJECTS.

       (a) Establishment.--
       (1) Review and report on results of existing 
     demonstrations.--
       (A) Review.--The Secretary shall conduct an empirical 
     review of the results of the demonstrations under sections 
     442, 443, and 444.
       (B) Report.--Not later than January 1, 2008, the Secretary 
     shall submit a report to Congress on the empirical review 
     conducted under subparagraph (A) which shall include 
     estimates of the total costs of the demonstrations, including 
     expenditures as a result of the provision of services 
     provided to beneficiaries under the demonstrations that are 
     incidental to the services provided under the demonstrations, 
     and all other expenditures under title XVIII of the Social 
     Security Act. The report shall also include a certification 
     from the Chief Actuary of the Centers for Medicare & Medicaid 
     Services that such estimates are reasonable, accurate, and 
     based on generally accepted actuarial principles and 
     methodologies.
       (2) Projects.--Beginning in 2009, the Secretary, based on 
     the empirical review conducted under paragraph (1), shall 
     establish projects under which medicare beneficiaries 
     receiving benefits under the medicare fee-for-service program 
     under parts A and B of title XVIII of the Social Security Act 
     are provided with coverage of enhanced benefits or services 
     under such program. The purpose of such projects is to 
     evaluate whether the provision of such enhanced benefits or 
     services to such beneficiaries--
       (A) improves the quality of care provided to such 
     beneficiaries under the medicare program;
       (B) improves the health care delivery system under the 
     medicare program; and
       (C) results in reduced expenditures under the medicare 
     program.
       (2) Enhanced benefits or services.--For purposes of this 
     section, enhanced benefits or services shall include--
       (A) preventive services not otherwise covered under title 
     XVIII of the Social Security Act;
       (B) chronic care coordination services;
       (C) disease management services; or
       (D) other benefits or services that the Secretary 
     determines will improve preventive health care for medicare 
     beneficiaries, result in improved chronic disease management, 
     and management of complex, life-threatening, or high-cost 
     conditions and are consistent with the goals described in 
     subparagraphs (A), (B), and (C) of paragraph (1).
       (b) Project Sites and Duration.--
       (1) In general.--Subject to subsection (e)(2), the projects 
     under this section shall be conducted--
       (A) in a region or regions that are comparable (as 
     determined by the Secretary) to the region or regions that 
     are designated as a highly competitive region under 
     subparagraph (A) or (B) of section 1858(i)(1) of the Social 
     Security Act, as added by section 231 of this Act; and
       (B) during the years that the region or regions are 
     designated as such a highly competitive region.
       (2) Rule of construction.--For purposes of paragraph (1), a 
     comparable region does not necessarily mean the identical 
     region.
       (c) Waiver Authority.--The Secretary shall waive compliance 
     with the requirements of title XVIII of the Social Security 
     Act (42 U.S.C. 1395 et seq.) only to the extent and for such 
     period as the Secretary determines is necessary to provide 
     for enhanced benefits or services consistent with the 
     projects under this section.
       (d) Biennial GAO Reports.--Not later than January 1, 2011, 
     and biennially thereafter for as long as the projects under 
     this section are being conducted, the Comptroller General of 
     the United States shall submit to the Secretary and Congress 
     a report that evaluates the projects. Each report shall 
     include--
       (1) an evaluation of--
       (A) the quality of care provided to beneficiaries receiving 
     benefits or services under the projects;
       (B) the satisfaction of beneficiaries receiving benefits or 
     services under the projects;
       (C) the costs to the medicare program under the projects; 
     and
       (D) any improvements in the delivery of health care 
     services under the projects; and
       (2) recommendations for such legislation or administrative 
     action as the Comptroller General determines to be 
     appropriate.
       (e) Funding.--
       (1) In general.--Payments for the costs of carrying out the 
     projects under this section shall be made from the Federal 
     Hospital Insurance Trust Fund under section 1817 of the 
     Social Security Act (42 U.S.C. 1395i) and the Federal 
     Supplementary Insurance Trust Fund under section 1841 of such 
     Act (42 U.S.C. 1395t), as determined appropriate by the 
     Secretary.
       (2) Limitation.--The total amount expended under the 
     medicare fee-for-service program under parts A and B of title 
     XVIII of the Social Security Act (including all amounts 
     expended as a result of the projects under this section) 
     during the period or year, as applicable, may not exceed--
       (A) for the period beginning on January 1, 2009, and ending 
     on September 30, 2013, an amount equal to the total amount 
     that would have been expended under the medicare fee-for-
     service program under parts A and B of title XVIII of the 
     Social Security Act during the period if the projects had not 
     been conducted plus $6,000,000,000; and
       (B) for fiscal year 2014 and any subsequent fiscal year, an 
     amount equal to the total amount that would have been 
     expended under the medicare fee-for-service program under 
     parts A and B of such title during the year if the projects 
     had not been conducted.
       (3) Monitoring and reports.--
       (A) Ongoing monitoring by the secretary to ensure funding 
     limitation is not violated.--The Secretary shall continually 
     monitor expenditures made under title XVIII of the Social 
     Security Act by reason of the projects under this section to 
     ensure that the limitations described in subparagraphs (A) 
     and (B) of paragraph (2) are not violated.
       (B) Reports.--Not later than April 1 of each year 
     (beginning in 2010), the Secretary shall submit a report to 
     Congress and the Comptroller General of the United States 
     that includes--
       (i) a detailed description of--

       (I) the total amount expended under the medicare fee-for-
     service program under parts A and B of title XVIII of the 
     Social Security Act (including all amounts expended as a 
     result of the projects under this section) during the 
     previous year compared to the total amount that would have 
     been expended under the original medicare fee-for-service 
     program in the year if the projects had not been conducted;
       (II) the projections of the total amount expended under the 
     medicare fee-for-service program under parts A and B of title 
     XVIII of the Social Security Act (including all amounts 
     expended as a result of the projects under this section) 
     during the year in which the report is submitted compared to 
     the total amount that would have been expended under the 
     original medicare fee-for-service program in the year if the 
     projects had not been conducted;
       (III) amounts remaining within the funding limitation 
     specified in paragraph (2); and
       (IV) how the Secretary will change the scope, site, and 
     duration of the projects in subsequent years in order to 
     ensure that the limitations described in subparagraphs (A) 
     and (B) of paragraph (2) are not violated; and

       (ii) a certification from the Chief Actuary of the Centers 
     for Medicare & Medicaid Services that the descriptions under 
     subclauses (I), (II), (III), and (IV) of clause (i) are 
     reasonable, accurate, and based on generally accepted 
     actuarial principles and methodologies.
       (4) Application of Limitation.--If the Secretary determines 
     that the projects under this section will cause the 
     limitations described in subparagraphs (A) and (B) of 
     paragraph (2) to be violated, the Secretary shall take 
     appropriate steps to reduce spending under the projects, 
     including through reducing the scope, site, and duration of 
     the projects.
       (5) Authority.--Beginning in 2014, the Secretary shall make 
     necessary spending adjustments (including pro rata reductions 
     in payments to health care providers under the medicare 
     program) to recoup amounts so that the limitations described 
     in subparagraphs (A) and (B) of paragraph (2) are not 
     violated.
                                 ______
                                 
  SA 1093. Mr. KYL proposed an amendment to amendment SA 1092 proposed 
by Mr. Grassley (for himself and Mr. Baucus) to the bill S. 1, to amend 
title XVIII of the Social Security Act to make improvements in the 
medicare program, to provide prescription drug coverage under the 
medicare program, and for other purposes; as follows:

       In lieu of the matter proposed to be inserted, insert the 
     following:

[[Page S8595]]

   Subtitle D--Evaluation of Alternative Payment and Delivery Systems

     SEC. 231. ESTABLISHMENT OF ALTERNATIVE PAYMENT SYSTEM FOR 
                   PREFERRED PROVIDER ORGANIZATIONS IN HIGHLY 
                   COMPETITIVE REGIONS.

       (a) Establishment of Alternative Payment System for 
     Preferred Provider Organizations in Highly Competitive 
     Regions.--Section 1858 (as added by section 211(b)) is 
     amended by adding at the end the following new subsection:
       ``(i) Alternative Payment Methodology for Highly 
     Competitive Regions.--
       ``(1) Annual determination and designation.--
       ``(A) In 2008.--In 2008, prior to the date on which the 
     Secretary expects to publish the risk adjusters under section 
     1860D-11, the Secretary shall designate a limited number (but 
     in no case fewer than 1) of preferred provider regions (other 
     than the region described in subsection (a)(2)(C)(ii)) as 
     highly competitive regions.
       ``(B) Subsequent years.--For each year (beginning with 
     2009) the Secretary may designate a limited number of 
     preferred provider regions (other than the region described 
     in subsection (a)(2)(C)(ii)) as highly competitive regions in 
     addition to any region designated as a highly competitive 
     region under subparagraph (A).
       ``(C) Considerations.--In determining which preferred 
     provider regions to designate as highly competitive regions 
     under subparagraph (A) or (B), the Secretary shall consider 
     the following:
       ``(i) Whether the application of this subsection to the 
     preferred provider region would enhance the participation of 
     preferred provider organization plans in that region.
       ``(ii) Whether the Secretary anticipates that there is 
     likely to be at least 3 bids submitted under subsection 
     (d)(1) with respect to the preferred provider region if the 
     Secretary designates such region as a highly competitive 
     region under subparagraph (A) or (B).
       ``(iii) Whether the Secretary expects that 
     MedicareAdvantage eligible individuals will elect preferred 
     provider organization plans in the preferred provider region 
     if the region is designated as a highly competitive region 
     under subparagraph (A) or (B).
       ``(iv) Whether the designation of the preferred provider 
     region as a highly competitive region will permit compliance 
     with the limitation described in paragraph (5).

     In considering the matters described in clauses (i) through 
     (iv), the Secretary shall give special consideration to 
     preferred provider regions where no bids were submitted under 
     subsection (d)(1) for the previous year.
       ``(2) Effect of designation.--If a preferred provider 
     region is designated as a highly competitive region under 
     subparagraph (A) or (B) of paragraph (1)--
       ``(A) the provisions of this subsection shall apply to such 
     region and shall supersede the provisions of this part 
     relating to benchmarks for preferred provider regions; and
       ``(B) such region shall continue to be a highly competitive 
     region until such designation is rescinded pursuant to 
     paragraph (5)(B)(ii).
       ``(3) Submission of bids.--
       ``(A) In general.--Notwithstanding subsection (d)(1), for 
     purposes of applying section 1854(a)(2)(A)(i), the plan bid 
     for a highly competitive region shall consist of a dollar 
     amount that represents the total amount that the plan is 
     willing to accept (not taking into account the application of 
     the comprehensive risk adjustment methodology under section 
     1853(a)(3)) for providing coverage of only the benefits 
     described in section 1852(a)(1)(A) to an individual enrolled 
     in the plan that resides in the service area of the plan for 
     a month.
       ``(B) Construction.--Nothing in subparagraph (A) shall be 
     construed as permitting a preferred provider organization 
     plan not to provide coverage for the benefits described in 
     section 1852(a)(1)(C).
       ``(4) Payments to preferred provider organizations in 
     highly competitive areas.--With respect to highly competitive 
     regions, the following rules shall apply:
       ``(A) In general.--Notwithstanding subsection (c), of the 
     plans described in subsection (d)(1)(E), the Secretary shall 
     substitute the second lowest bid for the benchmark applicable 
     under subsection (c)(4).
       ``(B) If there are fewer than three bids.--Notwithstanding 
     subsection (c), if there are fewer than 3 bids in a highly 
     competitive region for a year, the Secretary shall substitute 
     the lowest bid for the benchmark applicable under subsection 
     (c)(4).
       ``(5) Funding limitation.--
       ``(A) In general.--
       ``(i) In general.--The total amount expended as a result of 
     the application of this subsection during the period 
     beginning on January 1, 2009, and ending on September 30, 
     2013, may not exceed the applicable amount (as defined in 
     clause (ii)).
       ``(ii) Applicable amount defined.--In this paragraph, the 
     term `applicable amount' means the total amount that would 
     have been expended under this title during the period 
     described in clause (i) if this subsection had not been 
     enacted plus $6,000,000,000.
       ``(B) Application of limitation.--If the Secretary 
     determines that the application of this subsection will cause 
     expenditures to exceed the applicable amount, the Secretary 
     shall--
       ``(i) take appropriate steps to stay within the applicable 
     amount, including through providing limitations on 
     enrollment; or
       ``(ii) rescind the designation under subparagraph (A) or 
     (B) of paragraph (1) of 1 or more preferred provider regions 
     as highly competitive regions.
       ``(C) Transition.--If the Secretary rescinds a designation 
     under subparagraph (A) or (B) of paragraph (1) pursuant to 
     subparagraph (B)(ii) with respect to a preferred provider 
     region, the Secretary shall provide for an appropriate 
     transition from the payment system applicable under this 
     subsection to the payment system described in the other 
     provisions of this section in that region. Any amount 
     expended by reason of the preceding sentence shall be 
     considered to be part of the total amount expended as a 
     result of the application of this subsection for purposes of 
     applying the limitation under subparagraph (A).
       ``(D) Application.--Notwithstanding paragraph (1)(B), on or 
     after January 1 of the year in which the fiscal year 
     described in subparagraph (A)(ii)(II) begins, the Secretary 
     may designate appropriate regions under such paragraph.
       ``(6) Limitation of judicial review.--There shall be no 
     administrative or judicial review under section 1869, section 
     1878, or otherwise, of designations made under subparagraph 
     (A) or (B) of paragraph (1).
       ``(7) Secretary reports.--Not later than April 1 of each 
     year (beginning in 2010), the Secretary shall submit a report 
     to Congress and the Comptroller General of the United States 
     that includes--
       ``(A) a detailed description of--
       ``(i) the total amount expended as a result of the 
     application of this subsection in the previous year compared 
     to the total amount that would have been expended under this 
     title in the year if this subsection had not been enacted;
       ``(ii) the projections of the total amount that will be 
     expended as a result of the application of this subsection in 
     the year in which the report is submitted compared to the 
     total amount that would have been expended under this title 
     in the year if this subsection had not been enacted;
       ``(iii) amounts remaining within the funding limitation 
     specified in paragraph (5); and
       ``(iv) the steps that the Secretary will take under clauses 
     (i) and (ii) of paragraph (5)(B) to ensure that the 
     application of this subsection will not cause expenditures to 
     exceed the applicable amount described in paragraph (5)(A); 
     and
       ``(B) a certification from the Chief Actuary of the Centers 
     for Medicare & Medicaid Services that the descriptions under 
     clauses (i), (ii), (iii), and (iv) of subparagraph (A) are 
     reasonable, accurate, and based on generally accepted 
     actuarial principles and methodologies.
       ``(8) Biennial gao reports.--Not later than January 1, 
     2011, and biennially thereafter, the Comptroller General of 
     the United States shall submit to the Secretary and Congress 
     a report on the designation of highly competitive regions 
     under this subsection and the application of the payment 
     system under this subsection within such regions. Each report 
     shall include--
       ``(A) an evaluation of--
       ``(i) the quality of care provided to beneficiaries 
     enrolled in a MedicareAdvantage preferred provider plan in a 
     highly competitive region;
       ``(ii) the satisfaction of beneficiaries with benefits 
     under such a plan;
       ``(iii) the costs to the medicare program for payments made 
     to such plans; and
       ``(iv) any improvements in the delivery of health care 
     services under such a plan;
       ``(B) a comparative analysis of the benchmark system 
     applicable under the other provisions of this section and the 
     payment system applicable in highly competitive regions under 
     this subsection; and
       ``(C) recommendations for such legislation or 
     administrative action as the Comptroller General determines 
     to be appropriate.''.
       (b) Conforming Amendment.--Section 1858(c)(3)(A)(i) (as 
     added by section 211(b)) is amended to read as follows:
       ``(i) Whether each preferred provider region has been 
     designated as a highly competitive region under subparagraph 
     (A) or (B) of subsection (i)(1) and the benchmark amount for 
     any preferred provider region (as calculated under paragraph 
     (2)(A)) for the year that has not been designated as a highly 
     competitive region.''.

     SEC. 232. FEE-FOR-SERVICE MODERNIZATION PROJECTS.

       (a) Establishment.--
       (1) Review and report on results of existing 
     demonstrations.--
       (A) Review.--The Secretary shall conduct an empirical 
     review of the results of the demonstrations under sections 
     442, 443, and 444.
       (B) Report.--Not later than January 1, 2008, the Secretary 
     shall submit a report to Congress on the empirical review 
     conducted under subparagraph (A) which shall include 
     estimates of the total costs of the demonstrations, including 
     expenditures as a result of the provision of services 
     provided to beneficiaries under the demonstrations that are 
     incidental to the services provided under the demonstrations, 
     and all other expenditures under title XVIII of the Social 
     Security Act. The report shall also include a certification 
     from the Chief Actuary of the Centers for Medicare & Medicaid 
     Services that such estimates are reasonable, accurate, and 
     based on generally accepted actuarial principles and 
     methodologies.
       (2) Projects.--Beginning in 2009, the Secretary, based on 
     the empirical review conducted under paragraph (1), shall 
     establish

[[Page S8596]]

     projects under which medicare beneficiaries receiving 
     benefits under the medicare fee-for-service program under 
     parts A and B of title XVIII of the Social Security Act are 
     provided with coverage of enhanced benefits or services under 
     such program. The purpose of such projects is to evaluate 
     whether the provision of such enhanced benefits or services 
     to such beneficiaries--
       (A) improves the quality of care provided to such 
     beneficiaries under the medicare program;
       (B) improves the health care delivery system under the 
     medicare program; and
       (C) results in reduced expenditures under the medicare 
     program.
       (2) Enhanced benefits or services.--For purposes of this 
     section, enhanced benefits or services shall include--
       (A) preventive services not otherwise covered under title 
     XVIII of the Social Security Act;
       (B) chronic care coordination services;
       (C) disease management services; or
       (D) other benefits or services that the Secretary 
     determines will improve preventive health care for medicare 
     beneficiaries, result in improved chronic disease management, 
     and management of complex, life-threatening, or high-cost 
     conditions and are consistent with the goals described in 
     subparagraphs (A), (B), and (C) of paragraph (1).
       (b) Project Sites and Duration.--
       (1) In general.--Subject to subsection (e)(2), the projects 
     under this section shall be conducted--
       (A) in a region or regions that are comparable (as 
     determined by the Secretary) to the region or regions that 
     are designated as a highly competitive region under 
     subparagraph (A) or (B) of section 1858(i)(1) of the Social 
     Security Act, as added by section 231 of this Act; and
       (B) during the years that the region or regions are 
     designated as such a highly competitive region.
       (2) Rule of construction.--For purposes of paragraph (1), a 
     comparable region does not necessarily mean the identical 
     region.
       (c) Waiver Authority.--The Secretary shall waive compliance 
     with the requirements of title XVIII of the Social Security 
     Act (42 U.S.C. 1395 et seq.) only to the extent and for such 
     period as the Secretary determines is necessary to provide 
     for enhanced benefits or services consistent with the 
     projects under this section.
       (d) Biennial GAO Reports.--Not later than January 1, 2011, 
     and biennially thereafter for as long as the projects under 
     this section are being conducted, the Comptroller General of 
     the United States shall submit to the Secretary and Congress 
     a report that evaluates the projects. Each report shall 
     include--
       (1) an evaluation of--
       (A) the quality of care provided to beneficiaries receiving 
     benefits or services under the projects;
       (B) the satisfaction of beneficiaries receiving benefits or 
     services under the projects;
       (C) the costs to the medicare program under the projects; 
     and
       (D) any improvements in the delivery of health care 
     services under the projects; and
       (2) recommendations for such legislation or administrative 
     action as the Comptroller General determines to be 
     appropriate.
       (e) Funding.--
       (1) In general.--Payments for the costs of carrying out the 
     projects under this section shall be made from the Federal 
     Hospital Insurance Trust Fund under section 1817 of the 
     Social Security Act (42 U.S.C. 1395i) and the Federal 
     Supplementary Insurance Trust Fund under section 1841 of such 
     Act (42 U.S.C. 1395t), as determined appropriate by the 
     Secretary.
       (2) Limitation.--The total amount expended under the 
     medicare fee-for-service program under parts A and B of title 
     XVIII of the Social Security Act (including all amounts 
     expended as a result of the projects under this section) 
     during the period or year, as applicable, may not exceed--
       (A) for the period beginning on January 1, 2009, and ending 
     on September 30, 2013, an amount equal to the total amount 
     that would have been expended under the medicare fee-for-
     service program under parts A and B of title XVIII of the 
     Social Security Act during the period if the projects had not 
     been conducted plus $6,000,000,000; and
       (B) for fiscal year 2014 and any subsequent fiscal year, an 
     amount equal to the total amount that would have been 
     expended under the medicare fee-for-service program under 
     parts A and B of such title during the year if the projects 
     had not been conducted.
       (3) Monitoring and reports.--
       (A) Ongoing monitoring by the secretary to ensure funding 
     limitation is not violated.--The Secretary shall continually 
     monitor expenditures made under title XVIII of the Social 
     Security Act by reason of the projects under this section to 
     ensure that the limitations described in subparagraphs (A) 
     and (B) of paragraph (2) are not violated.
       (B) Reports.--Not later than April 1 of each year 
     (beginning in 2010), the Secretary shall submit a report to 
     Congress and the Comptroller General of the United States 
     that includes--
       (i) a detailed description of--

       (I) the total amount expended under the medicare fee-for-
     service program under parts A and B of title XVIII of the 
     Social Security Act (including all amounts expended as a 
     result of the projects under this section) during the 
     previous year compared to the total amount that would have 
     been expended under the original medicare fee-for-service 
     program in the year if the projects had not been conducted;
       (II) the projections of the total amount expended under the 
     medicare fee-for-service program under parts A and B of title 
     XVIII of the Social Security Act (including all amounts 
     expended as a result of the projects under this section) 
     during the year in which the report is submitted compared to 
     the total amount that would have been expended under the 
     original medicare fee-for-service program in the year if the 
     projects had not been conducted;
       (III) amounts remaining within the funding limitation 
     specified in paragraph (2); and
       (IV) how the Secretary will change the scope, site, and 
     duration of the projects in subsequent years in order to 
     ensure that the limitations described in subparagraphs (A) 
     and (B) of paragraph (2) are not violated; and

       (ii) a certification from the Chief Actuary of the Centers 
     for Medicare & Medicaid Services that the descriptions under 
     subclauses (I), (II), (III), and (IV) of clause (i) are 
     reasonable, accurate, and based on generally accepted 
     actuarial principles and methodologies.
       (4) Application of Limitation.--If the Secretary determines 
     that the projects under this section will cause the 
     limitations described in subparagraphs (A) and (B) of 
     paragraph (2) to be violated, the Secretary shall take 
     appropriate steps to reduce spending under the projects, 
     including through reducing the scope, site, and duration of 
     the projects.
       (5) Authority.--Beginning in 2014, the Secretary shall make 
     necessary spending adjustments (including pro rata reductions 
     in payments to health care providers under the medicare 
     program) to recoup amounts so that the limitations described 
     in subparagraphs (A) and (B) of paragraph (2) are not 
     violated.

                          ____________________